QRSM QRS Music Technologies Inc (CE)

Title of table should read "Selected Audited Financial Data" (sted "Selected Unaudited Financial Data). The corrected release reads: QRS MUSIC TECHNOLOGIES, INC. REPORTS YEAR-END RESULTS QRS Music Technologies, Inc. (OTCBB: QRSM) announced today record sales for the year ended June 30, 2005. Sales for the year ended June 30, 2004, were $20,247,169, an increase of 9.4% from the year ago period, with net income of $969,432 (available to common shareholders), or $.10 per share fully diluted. Comparable amounts for the year-ago period ended June 30, 2004, were total sales of $18,512.717 with net income of $1,334,982 (available to common shareholders), or $.14 per share fully diluted. Tom Dolan, President and CEO, said: "The majority of the sales increase is attributable to an increase in the sales of Pianomation(R) equipped Story & Clark pianos and Pianomation(R) hardware. The total cost of sales increased due to the increased sales volume and an increase in shipping and delivery costs as a result of the rising transportation costs and increased legal and accounting expenses. In addition, we had continued expense as we pushed into new international markets with the completion of our Hong Kong and Australian offices, the funding of a profit share plan on behalf of the company employees and an increase in accrued tax expense." Dolan added: "Also, a majority of the increase in expenses were directly attributed to or associated with additional Research and Development and the introductions of our state-of-the-art Petine(TM) and Ancho(TM) controllers. Research and development expenses increased 102.5% from $338,000 in fiscal 2004 to $684,000 in fiscal 2005 due to the varying development times of products in development. We are undertaking several large R&D projects to maintain our leading edge in technology for the music industry. "Also, several projects are nearing completion, and we plan to introduce them during the current fiscal year. "At the National Association of Music Merchandiser's ("NAMM") annual convention in January, we introduced the next generation of user interfaces for the Pianomation(R) player system the Ancho(TM) and the Petine(TM) that began shipping during the summer. We continue to focus our resources on our primary marketing philosophy of developing and manufacturing unique high-margin technology products for traditional pianos," Dolan added. The QRS Pianomation(R) system can turn any piano into a reproducing player piano. A hardware and software process can store and transport MIDI ("Musical Instrument Digital Interface") information as an analog signal. This process gives QRS the ability to store, and wirelessly transmit, MIDI performance data in an analog format from a controller (CD, video, cassette, DVD, MP3, WMA, CF) to the receiver on the piano. This creates numerous possibilities. For example, most off-the-shelf audio equipment has a left and right channel available for use. State-of-the-art technology permits QRS to store the digital signal in an analog format on the left channel of the software which operates those players. This leaves the right channel available for live prerecorded audio music, even vocal recordings. Pianomation(R) blends them together in perfect harmony and perfect synchronization. The Pianomation(R) MIDI System is the first product of its kind to "marry" analog and digital technology. QRS Music Technologies, Inc.'s stock is traded Over-The-Counter on the OTCBB: QRSM. Forward-Looking Statements. Statements made in this news release that relate to future plans, events or performances are forward-looking statements. Any statements containing words, such as, "believes," "should," "anticipates," "plans," or "expects" as well as other statements are forward-looking, and those statements involve risks and uncertainties outside of the control of QRS and are based on current expectations. Consequently, actual results could differ materially from the expectations expressed in these forward-looking statements. Attention is directed to cautionary statements in our filings on Form 10-KSB for the fiscal year ended June 30, 2005, and our other filings with the Securities and Exchange Commission. All those filings are available on the Web site of the Securities and Exchange Commission at www.sec.gov. -0- *T Selected Audited Financial Data For 12 Months Ended For 12 Months Ended 6/30/2004 6/30/2005 ---------------------------------------- Operating Data: Sales 18,512,717 20,247,169 Cost of sales 12,502,577 14,064,682 Gross Profit 6,010,140 6,182,487 Selling, general and administrative expense 3,267,189 3,790,904 Research and development 337,814 684,217 Income from operations 2,405,137 1,707,366 Interest Expense 22,773 32,552 Income before Taxes 2,382,364 1,674,814 Provision for Income Taxes 919,000 577,000 ---------------------------------------------------------------------- Less current yr preferred stock dividends in arrears 128,382 128,382 ---------------------------------------------------------------------- Net Earnings (Losses) 1,334,982 969,432 ---------------------------------------------------------------------- Net income per share 0.14 0.10 ---------------------------------------------------------------------- Balance Sheet Data: Total Assets 10,024,955 11,783,067 ---------------------------------------------------------------------- Total Liabilities 1,696,869 2,357,167 ---------------------------------------------------------------------- *T