Cylink pins future on new releases

After missing its revenue projections this summer sent Cylink Corp. stock

prices into free fall, company executives are taking steps to pull Cylink

back from the brink.

Organizations use Cylink products to protect and manage the access,

privacy and integrity of globally transmitted information. The company's

products are incorporated into local-area networks, wide-area networks and

public networks such as the Internet.

Although Cylink is primarily focused on banking and financial institutions,

it also serves federal government customers, such as the U.S. Postal Service

and the departments of Defense, Justice and Treasury.

Cylink's total revenues have increased steadily in recent years — from

about $42 million in 1998 to about $70 million in 2000 — but this summer

the company missed its revenue projections and paid a heavy price. Cylink

stock went from a high of $22 per to a low of about $3, said William Crowell,

the company's president and chief executive officer.

"We missed a revenue window, and we got punished — as so many companies

have. We have to restore confidence that we'll do better in the future,"

Crowell said.

To woo back investors, the company has reduced its workforce from 475

to 400 and reduced company expenses by about $12 million while releasing

a flurry of new products since June.

New products include:

* NetHawk, a virtual private network appliance for establishing secure

Internet communications.

* NetAuthority, a standards-based public-key infrastructure system that

is flexible and scalable.

* MiniKey, a low-cost, compact token that combines smart card and reader

features so PC users can authenticate their identity for e-business transactions.

Crowell said he hopes that within the first two fiscal quarters of 2001

the new products will have been adequately tested in the marketplace and

the company will begin to break even or show a modest profit.

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