Lernout & Hauspie (Nasdaq: LHSPF, Easdaq: LHSP-ED) (L&H), is a worldwide market leader in speech and linguistic technologies, products and services.

The company is divided into four divisions: core technologies; dictation; a division dedicated to discrete and continuous speech offerings; translation services and products; and Internet services. Its four core technologies are automatic speech recognition (ASR), text-to-speech (TTS), digital speech compression and text-to-text (translation).

For the second quarter of 1998, Lernout & Hauspie’s total revenues were $45 million, an increase of 113 % over reported revenues of $21.1 million for the second quarter of 1997. Net income before one-time charges and unusual items for the second quarter of 1998 reached $9.5 million. This represents $0.17 per share on 55.1 million average diluted shares outstanding, which is a 138% increase when compared to $4.0 million in net income, or $0.11 per share on 36.1 million average outstanding shares for the second quarter of 1997.

Revenues for the year increased by three times to just under $100 million compared with $31 million last year, and earnings grew by more than five times from 21 cents to more than $1.14 per share.

The company is divided into four product divisions:

• Speech Technologies Division, focusing on Automatic Speech Recognition (ASR), Text-to-Speech TTS) and Digital Speech Compression technologies.

• Dictation Division, dedicated to building a dictation engine for continuous speech applications.

• Translation Services Division, supplying first class text-to-text (translation). This service can be done via translators, machines or a combination of both.

• Language Technologies Division, providing machine translation solutions, Internet translation products and services, and intelligent content management solutions.

Advanced speech technology is one of the fastest growing segments of the technology industry. The market for speech and language technology is estimated to be $3.5 billion worldwide by the year 2001, driven by advances in speech-enabling technologies, increases in processing power, the proliferation electronic devices and the explosive use of the Internet.

Lernout & Hauspie’s stock price and volume for the last year. (Chart courtesy of www.infospace.com):

Lernout & Hauspie has quickly become one of the industry leaders in voice recognition technology. With the release of new products this summer, L&H has in many ways revolutionized the entire industry.

The new L&H VoiceXpress series is the first line of continuous speech recognition products to incorporate Natural Language Technology (NLT).

Natural Language Technology actually comprehends the meaning behind the words you say! If you want to capitalize a certain word, you could say "Capitalize that word" or "Capitalize that " or "Make that word capitalized" and it understands what it is that you wish for the computer to do.

Here is a list of Lernout & Hauspie’s voice recognition software products:

• VoiceXpress - L&H Voice Xpress™ is the fast, efficient way to create finished documents. It lets you dictate text, edit, and even format your pages… all with the sound of your voice. Get more done at work, at school, and at home. Just speak to your computer and watch as your words are instantly and accurately transcribed onto the screen. It all happens as fast as you can say L&H Voice Xpress.

• VoiceXpress Plus - L&H Voice Xpress Plus™ is the natural and efficient way to create text. Just speak in a conversational style, there's no need to pause between words. You have your choice; you can quickly enter text directly into Microsoft Word documents or create documents in the easy to use L&H Voice Xpress word processor. You can then copy and paste to move text to any Windows application.

• VoiceXpress for Medicine, General Medicine Edition - Just what the doctor ordered! Lernout & Hauspie’s L&H Voice Xpress for Medicine™ delivers an intuitive, continuous speech dictation solution that quickly and easily creates clinical reports, notes and letters using Microsoft® Word or a complimentary L&H Voice Xpress for Medicine word processor. L&H Voice Xpress for Medicine comes with a 60,000-word vocabulary capacity and understands your speech – regardless of tone or accent – with accuracy increasing with enrollment and each use.

• VoiceXpress for Medicine, Specialty Editions - L&H Voice Xpress for Medicine, Specialty Editions, come with a 60,000-word vocabulary capacity specific to certain fields of medicine and understand your speech – regardless of tone or accent – with accuracy increasing with enrollment and each use.

• Kurzweil VoicePlus - Kurzweil VoicePlus is the latest edition of the Kurzweil family of products. This discrete speech system offers a continuous digit recognizer and a 30,000-word vocabulary.

• Kurzweil VoicePro - Kurzweil VoicePlus is the latest edition of the Kurzweil family of products. This discrete speech system offers a continuous digit recognizer and a 60,000-word vocabulary.

• Kurzweil VoiceCommands - Kurzweil VoiceCommands: Kurzweil's first entry into the continuous speech market. However, this product is only a command and control system for Microsoft Word.

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