IPC Reports Fiscal Second Quarter 2004 Results.

Business Editors

NEW YORK--(BUSINESS WIRE)--May 10, 2004

IPC Acquisition Corp.

                Fiscal Q2 Results Summary (in millions)

                           Fiscal Three Months Ended
                                   March 31
                          --------------------------





				

				
				 
				


                            2004            2003
                            -----          ------
Revenues                   $79.0          $ 56.3
Net income (loss)          $ 2.8           ($0.6)

IPC Acquisition Corp. (IPC), the leading provider of mission-critical trading floor communication systems for the global financial services industry, today reported its fiscal second quarter 2004 financial results for the three months ended March 31, 2004. Fiscal second quarter 2004 revenues were $79.0 million compared to $56.3 million for the corresponding fiscal 2003 period, a $22.7 million increase.

On a business unit basis, second quarter 2004 consolidated revenues of $79.0 million were comprised of $57.9 million from Trading Systems operations, $9.2 million from ITS operations and $11.9 million from Network Services operations. This compares to the second quarter of 2003, in which consolidated revenues of $56.3 million were comprised of $45.1 million from Trading Systems and $11.2 million from ITS. The Network Services business unit was formed in April 2003 with the acquisition of the Gains International US and European businesses and completed in January 2004 with the acquisition of the Gains International Asia business.

Actual net income for the second quarter 2004 was $2.8 million compared to a net loss of $0.6 million for the same period a year ago, reflecting the increase in revenues.

"Our second quarter results include revenue growth from IPC Network Services and demonstrate the immediate synergies we are witnessing from adding enhanced services to our industry leading portfolio of trading systems equipment," said Lance Boxer, chief executive officer of IPC. "We added a significant number of new clients in the quarter to our growing roster of customers using IPC Network Services. We are also seeing significant interest in the enhanced services we have rolled out which provide solutions for circuit and network management, resulting in cost efficiencies, greater flexibility, and increased productivity for traders. More and more of our clients are relying on IPC not just for turrets, but for our expertise in providing a broad package of trading floor services."

                        IPC ACQUISITION CORP.
                CONDENSED CONSOLIDATED BALANCE SHEETS
                 (In Thousands Except Share Amounts)
                             (Unaudited)
                                               March 31, September 30,
                                                  2004        2003
                                              ---------- -------------
                    Assets
Assets:
 Cash                                          $ 10,972   $   25,800
 Accounts receivable, net of allowance of
  $2,170 and $1,103, respectively                53,987       60,201
 Inventories, net                                25,786       30,396
 Prepaid and other current assets                 6,031        5,523
                                                --------   ----------
     Total current assets                        96,776      121,920

 Property, plant and equipment, net              25,290       24,419
 Goodwill                                        95,251       83,079
 Intangible assets, net                         198,917      200,085
 Deferred financing costs, net                   13,191       14,146
 Other assets                                     1,172        1,261
                                                --------   ----------
     Total assets                              $430,597   $  444,910
                                                ========   ==========

     Liabilities and Stockholders' Equity
Liabilities:
 Current portion of long term debt             $    550   $      550
 Accounts payable                                 5,294        2,787
 Accrued expenses and other current
  liabilities                                    29,995       28,541
 Income taxes payable                             3,975        4,208
 Customer advances on installation contracts     11,595       18,989
 Deferred revenue on maintenance contracts       19,134       13,128
 Current portion of guarantees on former
  parent obligations                              1,353        1,353
 Deferred purchase consideration                     --        6,722
                                                --------   ----------
     Total current liabilities                   71,896       76,278

 Term loan                                       54,175       54,450
 Senior subordinated notes                      150,000      150,000
 Deferred taxes, net                             16,490       12,182
 Deferred compensation                            2,885        2,936
 Guarantees on former parent obligations and
  other long term liabilities                     1,339        1,885
                                                --------   ----------
     Total liabilities                          296,785      297,731
                                                --------   ----------

Commitments and Contingencies

Stockholders' equity:
 Common stock, $0.01 par value, 25,000,000
  shares authorized; 14,724,380 shares issued
  and outstanding at March 31, 2004 and
  September 30, 2003, respectively                  147          147
 Paid in capital                                145,846      145,846
 Notes receivable for purchases of common
  stock                                            (325)        (393)
 Accumulated deficit                            (22,084)      (5,161)
 Accumulated other comprehensive income          10,228        6,740
                                                --------   ----------
     Total stockholders' equity                 133,812      147,179
                                                --------   ----------
     Total liabilities and stockholders'
      equity                                   $430,597   $  444,910
                                                ========   ==========



                        IPC ACQUISITION CORP.
           CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                             (Unaudited)
                            (In Thousands)

                             Three Months Ended    Six Months Ended
                                  March 31,            March 31,
                                2004      2003       2004       2003
                             --------- --------- ---------- ----------
Revenue:
 Product sales and
  installations              $41,002   $32,819   $ 69,106   $ 56,570
 Service                      38,037    23,486     70,100     48,118
                              -------   -------   --------   --------
                              79,039    56,305    139,206    104,688
                              -------   -------   --------   --------
Cost of goods sold
 (depreciation shown
 separately):
 Product sales and
  installations               22,196    19,680     39,463     31,934
 Service                      19,059    11,894     35,785     24,929
 Depreciation and
  amortization                   968       299      1,710        596
                              -------   -------   --------   --------
                              42,223    31,873     76,958     57,459
                              -------   -------   --------   --------

   Gross profit               36,816    24,432     62,248     47,229

Research and development       3,599     2,928      7,008      5,663
Selling, general and
 administrative               15,138    10,742     28,426     19,472
Depreciation and amortization  5,388     4,798     10,555      9,529
                              -------   -------   --------   --------
   Income from operations     12,691     5,964     16,259     12,565

Other income (expense):
 Interest expense, net        (5,814)   (6,477)   (11,336)   (12,682)
 Other income (loss), net       (140)      802        307      1,327
                              -------   -------   --------   --------
   Income before income taxes  6,737       289      5,230      1,210

Income tax expense             3,932       900      4,189      2,023
                              -------   -------   --------   --------

Net income (loss)            $ 2,805   $  (611)  $  1,041   $   (813)
                              =======   =======   ========   ========

Editor's Note

-- IPC earnings conference call is scheduled for 11:00 a.m. E.T.

Tuesday, May 11, 2004. Dial (913) 981-5524 or (800) 289-0530

with conference code 541372 or access via the Web at

www.ipc.com or

http://www.firstcallevents.com/service/ajwz398746108gf12.html.

-- Conference call replays will be available over the Web through

August 11, 2004 at www.ipc.com.

About IPC

IPC is a leading provider of mission-critical trading floor communication systems and network services to the global financial services industry. With more than 30 years of trading room expertise, IPC provides its systems and services to most of the world's largest financial institutions and has more than 100,000 trading systems deployed in 50 countries. IPC offers its customers an integrated suite of products and enhanced services that include its advanced IQMX Voice over IP trading system, voice and integrated network services to 40 countries, and comprehensive business continuity planning. Based in New York, IPC has 700 employees throughout the Americas, Europe, and the Asia Pacific region. For more information visit www.ipc.com.

Statements made in this news release that state IPC's or its management's intentions, beliefs, expectations, or predictions for the future constitute "forward looking statements" as defined by federal securities laws, which involve significant risks and uncertainties. Many risks and uncertainties are inherent in the telecommunications equipment industry. Others are more specific to our operations. The occurrence of the events described and the achievement of the expected results depend on many factors, some or all of which are not predictable or within our control. Actual results may differ materially from results discussed in these forward-looking statements. Among the factors that could cause actual results, performance or achievement to differ materially from those described or implied in the forward-looking statements, are risks associated with substantial indebtedness, leverage and debt service, risks relating to the performance of our business and future operating results, risks of competition in our existing and future markets, loss or retirement of key executives, risks related to the notes and to high yield securities generally, general business and economic conditions, market acceptance issues, including potential technology changes and the risks inherent in new product and service introductions and the entry into new geographic markets, as well as those risk factors described in our filings with the SEC.

(C)2004 IPC Acquisition Corp. All Rights Reserved. IPC, IQMX, and ICMX are trademarks of IPC. All other trademarks are the property of their respective owners.