DataLogic Releases CEO Letter to Shareholders Outlining Company's Performance and Forward Guidance IRVINE, Calif., Feb. 19 /PRNewswire-FirstCall/ -- DataLogic International, Inc. (OTC Bulletin Board: DLGI; Berlin Stock Exchange: 779612), today releases a letter to shareholders outlining its performance and forward guidance. To Our Valued Shareholders, As we enter into another exciting year, I'd like to express my deepest gratitude to all our shareholders for your continuing vote of confidence, patience, and support throughout the last two and a half years of DataLogic as a publicly-traded company. Although the roads to growth and profits were often paved with obstacles, temporary defeats and false promises, DataLogic has weathered and survived one of toughest economic downturns that the Company has encountered since its inception. Today, DataLogic is a completely different company with improved operations, sales and growth opportunities. As part of our on-going open communications and commitments to our shareholders, I'd like to share some of our recent accomplishments along with future plans that will set the stage for the most exciting events in the history of DataLogic: IT Services Since inception, DataLogic Consulting Inc. (DCI) has been the provider of Information Technology (IT) Consulting Services. Although this company had performed well as an independent privately-held company from its inception to the late nineties, it became a victim of the technology and economic meltdown in the early 2000's. In response, DataLogic's management diligently searched for new market segments in which to target. At that point, we decided to pursue governmental service contracts. This had proved to be a positive move since the Company was later awarded several major multi-year service contracts with governmental entities in the state of New York and Rhode Island for an approximate combine value of $40 million. As a result of this phenomenal turn around, we were pleased to booked record sales in excess of $10 million at the end of fiscal 2003 as compared to $2 million from the prior year. Although Consulting Services is still our core business and a major source of our revenues, we are not overly satisfied with its rate of return due to the continued weakness in the economy in general and IT in particular. As a counter measure, we again seek for other market segments for growth. As a result, we expanded our business model to include being a provider of VoIP and Machine-to-Machine (M2M) products and services. Each of these segments has huge growth potential. We also believe our entrance timing to these markets is great due to the technology maturation, proliferation of broadband and wireless standards. VoIP Last June, DataLogic acquired a majority stake in I-Phonehome, which we later renamed to IPN Communications, to enter into the VoIP space. IPN is a provider of VoIP products and services for the consumer and business markets. Our unique suite of services provides free to low-cost, high quality phone calls using our innovative Voice over IP calling devices. Our system allows subscribers to receive and place calls to any telephone, mobile phone or other IP-Phones in the world. Since the acquisition, IPN had received several purchase orders ranging from domestic resellers to international telecommunication carriers. Some of IPN's notable achievements include the agreements to evaluate VoIP phones and servers by Teracom Technology in China and Vietnam Post and Telecom (VNPT) for deployment in their respective regions with a combined population of almost 2 billion. Our equipment are also being evaluated by several other large firms who have asked to remain anonymous due to competitive reasons. We expect these efforts to result in sizable purchase orders in Q1 and Q2 of this year. According to a recent research study from Insight Research, VoIP based services is expected to grow from $13 billion in 2002 to nearly $197 billion by 2007, making it the fastest-growing segments in the telecommunications industry. Our plans to capture some of this market include both domestic and international marketing but with a heavier emphasis on the latter. In addition to North America, we will continue to place heavy marketing emphasis to Asia, South America and Europe where we see significant value for VoIP products and services. Also, as part of our near-term strategic plan, we intend to spin-off IPN into a public entity to create a VoIP pure play. We believe this willenhance the equity and market capitalization for DataLogic as well as our shareholders. Machine-to-Machine (M2M) Earlier this quarter, DataLogic launched Panther, a GPS based vehicle tracking device as its first M2M application. Our devices, available in both GSM and CDMA, have attracted a high level of interest from both domestic and international distributors and resellers. Currently, we have agreements in place with distributors in the US, UK, and Brazil. By the second quarter, we expect to sign with additional distributors in Germany, Holland, France, Colombia, Chile, Paraguay, Bolivia, Australia, New Zealand, and Southeast Asia. We are also actively working with domestic and international back end application developers to interface with and market our products to their respective clients. The existing market for wireless telemetry is estimated to be $1.15 billion and by the year 2006, it is estimated that the combine revenue within the M2M market (US, Japan, and Western Europe) will be$3.6 billion as researched by the Yankee Group and growing to $100 Billion by the end of year 2010 according to McKinsey and Company. These are very promising products that we think will contribute to DataLogic's bottom line in terms of high sales and profit margins. As part of our near term marketing initiatives, we plan to exhibit the devices with our partners at the expos in Brazil, Atlanta and Las Vegas next month. Sales Projections Our company now consists of three core businesses - ConsultingServices, VoIP and M2M. For fiscal 2004, we expect our Consulting Services to remain a dominant source of revenues with projected sales that comprise of approximately 60% of total revenues. We expect each of our VoIP and M2M segment to conservativelymake up 20% of total revenues. Our conservative organic growth projection for fiscal 2004 is $20 million. We expect to exceed this amount via our external growth through merger and acquisitions. External Growth We are actively seeking funding and expect to undergo a major capital restructuring this quarter. We also expect to complete several merger and acquisitions of other technology, VoIP and/or M2M companies in efforts to increase our market shares and company valuation. Although we will continue to grow our current businesses, we will not be limited to our current technologies. Our focus going forward is in the global economy. We will continue to seek out emerging markets and growth trends in which to enter. Our new business model includes roll-up initiatives in which we identify, acquire and consolidate profitable businesses. These businesses can be located anywhere in the world. Once sufficient funding has been secured and our business has reached the projected benchmarks, the next logical step would be to apply for a listing on the NASDAQ Smallcap Exchange. To do so, we'll need to have the right substance and meet certain share price/assets criteria along with the right investor groups and market makers that could tell our story to the investment communities. We think the timeframe to meet those criteria is between six to twelve months. However, we will achieve this goal quicker if the right events and resources are in place before that. In conclusion, we're quite pleased with the progress we have made in all facets of our business as evidenced by our current stock price. Our stock has been trading near its 52-week high compared to 3 cents less than a year ago. Now that the company is on a steady growth track, we willupdate you frequently with our progresses. Again, we thank you for your support. Without your heartfelt support and encouragement, DataLogic wouldn't be where we are today. Sincerely, Derek Nguyen Chief Executive Officer About DataLogic International Inc. DataLogic International, Inc. is a technology and professional service company dedicated to providing a wide range of Information Technology and Communications related products and services. For more information about DataLogic, goto http://www.dlgi.com/ or contact Investor Relations at or (888) 530-8228. This release contains forward-looking statements within the meaning of Section 27a of the Securities Act of 1933, as amended and section 21e of the Securities and Exchange Act of 1934, as amended. Those statements include the intent, belief or current expectations of the company and its management team. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those projected in the forward-looking statements as a result of various factors. Accomplishing the strategy described herein is significantly dependent upon numerous factors, many are not in management's control. Some of these factors include the ability of the company to raise sufficient capital, attract qualified management, attract new customers and effectively compete against similar companies. DATASOURCE: DataLogic International, Inc. CONTACT: Investor Relations of DataLogic, +1-888-530-8228, Web site: http://www.dlgi.com/

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