[0] SPSS Reports Fourth Quarter and Year-end Results; New Corporate Structure Implemented to Accelerate Next Phase of Growth.Business Editors NOTE TO MEDIA: Graphics are available in a Smart News Release(TM) on Business Wire's Home Page at www.businesswire.com and at www.newstream.com CHICAGO--(BUSINESS WIRE)--Feb. 21, 2001 SPSS A statistical package from SPSS, Inc., Chicago (www.spss.com) that runs on PCs, most mainframes and minis and is used extensively in marketing research. It provides over 50 statistical processes, including regression analysis, correlation and analysis of variance. Inc. (Nasdaq: SPSS), a worldwide provider of analytical analytical, analytic pertaining to or emanating from analysis. analytical control control of confounding by analysis of the results of a trial or test. solutions for creating more profitable customer relationships, today announced results for the fourth quarter and fiscal year ended Dec. 31, 2000. On a pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma basis consistent with previous reporting and revenue recognition practices, net revenues in the quarter were $43.2 million and diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of (EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. ) were $0.60, which compare to 1999 pro forma figures (which also exclude acquisition charges) of $40.7 million and $0.63 respectively. For the fiscal year, pro forma net revenues were $157.8 million and diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. EPS were $1.79, which compare to 1999 pro forma figures of $141.9 million and $1.66 respectively. After reviewing recent interpretations of various AICPA AICPA See American Institute of Certified Public Accountants (AICPA). Technical Practice Aids concerned with software revenue recognition practices and Staff Accounting Bulletin (SAB SAB Spontaneous abortion. See Abortion. ) 101 from the U. S. Securities and Exchange Commission, the company also prospectively applied and reported results for the fourth quarter and the restated effects on the fiscal year ended Dec. 31, 2000. This application shows the negative effects of deferring revenues from the fourth quarter 2000 associated with multi-year agreements and annual licenses -- without showing any of the positive compensating effects of including such revenues deferred from prior quarters. As modified mod·i·fy v. mod·i·fied, mod·i·fy·ing, mod·i·fies v.tr. 1. To change in form or character; alter. 2. , net revenues in the quarter were reduced to $26.3 million with a diluted loss per share of ($0.41). Similar adjustments for the fiscal year reduced net revenues to $140.8 million and diluted EPS to $0.87. Although adoption of these accounting changes negatively affects the results reported for this quarter and fiscal year, this is not a reflection of business operations Business operations are those activities involved in the running of a business for the purpose of producing value for the stakeholders. Compare business processes. The outcome of business operations is the harvesting of value from assets and will have no impact on cash flows going forward. The company is currently examining the impact of these changes on its future financial reporting and, as discussed later in this release, will be providing revised guidance in this regard.
Pro Forma results summary excluding deferred revenue adjustment and
acquisition-related charges (in millions, except for per share and
shares outstanding amounts)
----------------------------------------------------------------------
Three months ended Twelve months ended
Dec. 31, Dec. 31,
----------------------------------------------------------------------
2000 1999 Year/year 2000 1999 Year/year
% change % change
----------------------------------------------------------------------
Net
revenues $43.2 $40.7 6% $157.8 $141.9 11%
----------------------------------------------------------------------
Operating
income $8.3 $9.9 (16%) $28.5 $24.2 9%
----------------------------------------------------------------------
Net income $6.3 $6.5 (3%) $18.9 $16.9 12%
----------------------------------------------------------------------
Diluted EPS $0.60 $0.63 (5%) $1.79 $1.66 8%
----------------------------------------------------------------------
Weighted
shares
outstanding 10,453,751 10,226,680 2% 10,542,441 10,175,576 4%
----------------------------------------------------------------------
Results summary (in millions, except for per share and shares
outstanding amounts)
----------------------------------------------------------------------
Three months ended Twelve months ended
Dec. 31, Dec. 31,
----------------------------------------------------------------------
2000 1999 Year/year 2000 1999 Year/year
% change % change
----------------------------------------------------------------------
Net
revenues $26.3 $40.7 (35%) $140.8 $141.9 (1%)
----------------------------------------------------------------------
Operating
income
(loss) ($8.7) $8.2 (206%) $11.5 $24.5 (53%)
----------------------------------------------------------------------
Net income
(loss) ($4.1) $5.2 (179%) $8.5 $15.5 (45%)
----------------------------------------------------------------------
Diluted EPS ($0.41) $0.51 (180%) $0.81 $1.52 (47%)
----------------------------------------------------------------------
Weighted
shares
outstanding 10,012,396 10,226,680 (2%) 10,542,441 10,191,674 3%
----------------------------------------------------------------------
As stated in the company's earnings pre-release of Feb. 8, 2000, results for the fourth quarter were negatively affected by: -- Solutions - focused on selling our new branded analytical solutions, such as CustomerCentric, to corporate executives. Sue Phelan, SPSS Inc. executive vice president, leads this business. -- Technologies - selling developer products, such as analytical components and solution development frameworks, to corporate executives, typically at independent software vendors (ISV's). These solutions will be built into analytical applications by software developers and resold as an integral part of the ISV's offering to their customers. David Blyer, the former president of Vento Software and a current SPSS Inc. vice president, leads this business. -- Products - focused on selling analytical products, such as Clementine and SPSS, for use by analysts and researchers. Mark Battaglia, SPSS Inc. executive vice president, leads this business, which also incorporates the Science products unit. -- Market Research - focused on selling end-to-end data collection and analysis solutions to top executives in the market research industry and corporate market research departments. Ian Durrell, SPSS Inc. executive vice president, will continue to lead this business. -- ShowCase - SPSS announced its agreement to acquire ShowCase Corporation, a leading provider of enterprise intelligence solutions to the IBM iSeries (A/S 400) marketplace, on November 7, 2000. When the transaction is completed, this business will focus on selling enterprise intelligence solutions (a combination of the current ShowCase offerings and SPSS products) to line-of-business and information technology executives at organizations with iSeries computing systems. Patrick Dauga, who is currently ShowCase's executive vice president of worldwide sales, will lead this business. "Many people thought we would benefit more from the weakening weak·en tr. & intr.v. weak·ened, weak·en·ing, weak·ens To make or become weak or weaker. weak  en·er n. U.S. dollar seen in the last two months of 2000," said Edward Edwardkilled his father at his mother’s instigation. [Br. Balladry: Edward in Benét, 302] See : Patricide Hamburg Hamburg, city, Germany Hamburg (häm`b  rkh), officially Freie und Hansestadt Hamburg (Free and Hanseatic City of Hamburg), city (1994 pop. , SPSS Inc. executive vice president and CFO See Chief Financial Officer. . "We did, but
because you account for revenue and expenses using average exchange
rates from the start of the fiscal year, it was much too little too
late. These switches got reset on Jan. 1, 2001, so perhaps we can see
some improvement from exchange effects in the coming year."
"In 2000, we committed to increasing our investment in the business, particularly for sales and consulting personnel, with the goal of accelerating growth in our top line," said Jack Noonan The term Noonan might refer to: People
"There is no doubt that some of our difficulties in the fourth quarter stemmed stemmed adj. 1. Having the stems removed. 2. Provided with a stem or a specific type of stem. Often used in combination: stemmed goblets; long-stemmed roses. from exchange rates and the attention given to making the ShowCase deal happen," he continued. "Senior management's efforts, including nearly two-thirds of my travel time in the quarter, were spent meeting with ShowCase personnel rather than helping to close business. But most of the problems we confronted were related to execution, and we are making both organizational and personnel changes to address these issues. This realignment re·a·lign tr.v. re·a·ligned, re·a·lign·ing, re·a·ligns 1. To put back into proper order or alignment. 2. To make new groupings of or working arrangements between. of our senior management structure is designed to definitively focus the organization on the distinctive businesses that make up SPSS, as well as ensure the effective incorporation of ShowCase into our operations. The result should be a company that better delivers integrated solutions for analytical CRM (business) analytical CRM - Software which helps a business build customer relationships and analyse ways to improve them. applications, a comprehensive set of products to research analysts, state-of-the-art technologies to independent software vendors, end-to-end end-to-end a pattern of anastomosis in which severed ends are matched and united, in contrast with other patterns such as end-to-side or side-to-side. Usually applied to anastomosis of the intestine. analytical solutions to the market research industry, and a full range of business intelligence products to middle-market The term middle-market may refer to either a type of newspaper or a type of company. A middle-market newspaper is one that attempts to cater to readers who want some entertainment value from their newspaper as well as adequate serious coverage of significant news customers with IBM (International Business Machines Corporation, Armonk, NY, www.ibm.com) The world's largest computer company. IBM's product lines include the S/390 mainframes (zSeries), AS/400 midrange business systems (iSeries), RS/6000 workstations and servers (pSeries), Intel-based servers (xSeries) iSeries A family of midrange servers from IBM that are based on IBM's POWER CPUs and run under the i5/OS, OS/400 and AIX operating systems. Windows and Linux can also be run in an attached x86-based server (see IXS). (AS/400) computing computing - computer systems." Significant sales made during the fourth quarter included: -- The IBM e-Marketing Strategy Global Practice, an IBM Global Services Group, will include an SPSS solution in its technologies to both execute To run a program, which causes the computer to carry out its instructions. See executable code, instruction and EXE file. execute - execution and publish market research online as part of its client services. -- The Health Care Financing Administration Health Care Financing Administration, n.pr department in the U.S. agency of Health and Human Services responsible for the oversight of the Medicaid and Medicare benefit programs, including guidelines, payment, and coverage policies. (HCFA HCFA abbr. Health Care Financing Administration HCFA, n.pr See Health Care Financing Administration. ), the U.S. federal agency that administers Medicare Medicare, national health insurance program in the United States for persons aged 65 and over and the disabled. It was established in 1965 with passage of the Social Security Amendments and is now run by the Centers for Medicare and Medicaid Services. , Medicaid Medicaid, national health insurance program in the United States for low-income persons; established in 1965 with passage of the Social Security Amendments and now run by the Centers for Medicare and Medicaid Services. and the State Children's Health Children's Health Definition Children's health encompasses the physical, mental, emotional, and social well-being of children from infancy through adolescence. Program, purchased Clementine Clementine forty-niner’s drowned daughter; “lost and gone forever.” [Am. Music: Leach, 236] See : Grief for use in its peer review organizations peer review organization Professional review organization, qualilty improvement organization Managed care An independent or sponsored group of physicians or other appropriate peers–eg, allied health professionals who conduct pre-admission, continued stay, to evaluate and ultimately reduce payment errors. -- Step 9 Software Corp. will integrate SPSS analytical technology into iCustomer, an expanded and intelligent order entry and management offering for telecommunications service In telecommunication, the term telecommunications service has the following meanings: 1. Any service provided by a telecommunication provider. 2. providers. -- Ascension Health Ascension Health is a non-profit company that operates a network of hospitals and related health facilities in the United States. It is the nation's largest Catholic and largest non-profit health system[1]. , a not-for-profit Not-for-profit An organization established for charitable, humanitarian, or educational purposes that is exempt from some taxes and in which no one in profits or losses. Catholic healthcare system with over 75 facilities and 87,000 employees, will use various SPSS products to provide Web-based employee satisfaction surveys and distribute the results online. -- heartbase(TM), a supplier of a patient-centric longitudinal lon·gi·tu·di·nal adj. Running in the direction of the long axis of the body or any of its parts. clinical information system, will incorporate SPSS technology into their cardiac cardiac /car·di·ac/ (-ak) 1. pertaining to the heart. 2. pertaining to the cardia. car·di·ac adj. 1. Of, near, or relating to the heart. 2. database enabling users to increase the quality of cardiac care. -- Janssen Pharmaceutica Janssen Pharmaceutica, is a pharmaceutical company based in Beerse, Belgium, was established in 1953 by Dr. Paul Janssen. It was created not as a subsidiary of a chemical factory but solely with the aim of conducting pharmacological research. , a leader in treatments for disorders A
the central nervous system, will use SPSS software to predict the best locations for conducting clinical trials. -- Harris Interactive Harris Interactive (NASDAQ: HPOL) is an American market research company that specializes in public opinion research using both telephone and surveys on online panels. The company is the product of a 1996 merger between the Gordon S. Black Company and Louis Harris & Associates. expanded its relationship with SPSS in a purchase enabling it to expand and improve its Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the survey infrastructure and better serve its customers' needs. -- National Instruments National Instruments, or NI (NASDAQ: NATI), is an American company with over 4,000 employees and direct operations in 41 countries founded in 1976 by Dr. James Truchard, Bill Nowlin and Jeff Kodosky. , a worldwide leader of measurement and automation solutions, licensed SPSS technologies for use in its customer relationship management efforts. Hamburg noted that despite the difficulties the company faced in the quarter, growth in analytical solutions revenues was still up by more than 20 percent sequentially se·quen·tial adj. 1. Forming or characterized by a sequence, as of units or musical notes. 2. Sequent. se·quen from the third quarter and 58 percent from the fourth quarter of 1999. He said "this growth from the fourth quarter last year was actually 66 percent without exchange effects, and performance in the market research and statistics categories was seven and eight percentage points better respectively, net of exchange. For the year, we pretty much saw the growth we expected in analytical solutions and market research revenues; the disappointment was in our declining statistics revenue, which is a category designated for special executive attention under our new organizational structure  This article has no lead section.To comply with Wikipedia's lead section guidelines, one should be written. ." Hamburg's other observations on the quarter include:
Topic Comments on Pro Forma numbers
-------------------- -------------------------------------------------
Cost of revenue Down 8% in the quarter, 3% for the year (to 8%
of revenues) primarily due to a decrease in
shipping costs and royalties paid to third-party
software providers commensurate with the decline
in Statistics revenue, specifically sales
transactions under $1,000.
-------------------- -------------------------------------------------
Sales and marketing Up $3.1 million from 4Q99 and grew from 47% to
expenses 51% of revenue; up $12.9 million from December
1999 and grew from 48% to 51% of revenues.
Reflects the company's strategy of expanding
sales management, recruiting additional, more
senior sales representatives, and hiring more
professional services personnel. This increase
was partially offset by changes in foreign
currency exchange rates.
-------------------- -------------------------------------------------
General and Up 45% (about $800K) from 4Q99 and grew from 4%
administrative to 6% of revenues. Increase shows additional
expenses professional fees and expense for accounting
personnel and information systems.
-------------------- -------------------------------------------------
Operating income Decreased by 16% from 4Q99 to $8.3 million, as a
result of the shortfall in revenues relative to
analyst and internal expectations combined with
expenses approximating plan. Still up 9% in the
fiscal year. Very much-affected negatively by
foreign currency throughout the twelve-month
period.
-------------------- -------------------------------------------------
Other expense A gain of $479K in the quarter from foreign
currency translations, representing the one
positive realized by the company from the recent
weakening of the dollar. $1.2 million gain for
the fiscal year, representing the 4Q00 currency
gain and proceeds from the divestiture of our
product line for statistical quality control;
partially offset by losses from currency
translations earlier in the year.
-------------------- -------------------------------------------------
Net income Down 3% between 4Q00 and 4Q99 but up by 12% in
the fiscal year. Net income was reduced in the
first three quarters by the increase in 2000 of
our estimated effective tax rate from 34% to 38%;
correction made in the fourth quarter due to the
determination at year-end that the estimate was
too conservative.
-------------------- -------------------------------------------------
Cash $10.3 from $8.7 million in September 2000 but
down from $16.8 million in December 1999;
borrowings on short-term note increased to $16
million. Using cash primarily for increased
purchases of fixed assets (office expansions,
implementing new internal business systems), an
additional payout related to the ISL acquisition,
our e.Intelligence investment made in March, and
purchases of product for inventory.
-------------------- -------------------------------------------------
Days Sales Up to 114 from 106 in September 2000 and 95 in
Outstanding December 1999. Primarily caused by an unusual
number of end-of-quarter transactions, very late
invoicing and collections due to problems with
the implementation of the new accounting systems,
and continued presence of deals with extended
payment terms. Along with rebuilding cash, DSO
reduction is a major initiative for 2001.
-------------------- -------------------------------------------------
Current Assets Up due to accruals of expenses related to the
pending acquisition of Showcase.
-------------------- -------------------------------------------------
Software Capitalized about $481K more than amortized in
capitalization the quarter; capitalized 15.6% of research and
development costs during the fiscal year,
comparable to other annual periods.
-------------------- -------------------------------------------------
Other assets Increase in goodwill from second ISL acquisition
payment, e.Intelligence investment.
-------------------- -------------------------------------------------
Other current Flat
liabilities
-------------------- -------------------------------------------------
Staff Increases primarily in sales and consulting
personnel. About 85% of sales people carry
quotas.
-------------------- -------------------------------------------------
New Organizational Structure "Heading into strategic planning Strategic planning is an organization's process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy, including its capital and people. meetings for 2001, the executive team began by reviewing the size, growth rates Growth Rates The compounded annualized rate of growth of a company's revenues, earnings, dividends, or other figures. Notes: Remember, historically high growth rates don't always mean a high rate of growth looking into the future. , risks, and required investments of each market in which SPSS participates, such as analytical CRM solutions, market research, data mining and statistics," said Noonan. "As a result of this work, we were better able to prioritize pri·or·i·tize v. pri·or·i·tized, pri·or·i·tiz·ing, pri·or·i·tiz·es Usage Problem v.tr. To arrange or deal with in order of importance. v.intr. the markets we wanted to most actively pursue. In particular, we created a strategic plan to take advantage of the rapidly growing CRM market, better employ our research and development efforts to work directly on client needs, and position the ShowCase acquisition to create a new market opportunity for SPSS." "There were also four very specific goals behind this reorganization The process of carrying out, through agreements and legal proceedings, a business plan for winding up the affairs of, or foreclosing a mortgage upon, the property of a corporation that has become insolvent. ," Noonan continued. "First, we wanted to make sure that there was executive-level attention focused on the key parts of our business. Second, we wanted to separate activities related to the sale, marketing, and delivery of our analytical solutions from that of our analytical products, enabling both businesses to grow by giving them the undivided UNDIVIDED. That which is held by the same title by two or more persons, whether their rights are equal, as to value or quantity, or unequal. 2. Tenants in common, joint-tenants, and partners, hold an undivided right in their respective properties, until attention they require. Third, we wanted to consolidate Consolidate To combine the assets, liabilities, and other financial items of two or more entities into one. Notes: This term is generally used in the context of consolidated financial statements. and more aggressively drive our efforts to have other independent software vendors incorporate our technology into their new analytical applications and products. Fourth and finally, we wanted to give the corporation a structure that would `scale,' providing corporate support and oversight
Oversight may refer to:
-- Solutions - focused on selling our new branded analytical solutions, such as CustomerCentric, to corporate executives. Sue Phelan, SPSS Inc. executive vice president, leads this business. -- Technologies - selling developer products, such as analytical components and solution development frameworks, to corporate executives, typically at independent software vendors (ISV's). These solutions will be built into analytical applications by software developers and resold as an integral part of the ISV's offering to their customers. David Blyer, the former president of Vento Software and a current SPSS Inc. vice president, leads this business. -- Products - focused on selling analytical products, such as Clementine and SPSS, for use by analysts and researchers. Mark Battaglia, SPSS Inc. executive vice president, leads this business, which also incorporates the Science products unit. -- Market Research - focused on selling end-to-end data collection and analysis solutions to top executives in the market research industry and corporate market research departments. Ian Durrell, SPSS Inc. executive vice president, will continue to lead this business. -- ShowCase - SPSS announced its agreement to acquire ShowCase Corporation, a leading provider of enterprise intelligence solutions to the IBM iSeries (A/S 400) marketplace, on November 7, 2000. When the transaction is completed, this business will focus on selling enterprise intelligence solutions (a combination of the current ShowCase offerings and SPSS products) to line-of-business and information technology executives at organizations with iSeries computing systems. Patrick Dauga, who is currently ShowCase's executive vice president of worldwide sales, will lead this business. The two corporate groups include: -- Research & Development - This group's primary initiative is to share innovation and intellectual capital throughout the organization. Jon JON Jonah JON Jesus of Nazareth JON Job Order Number JON Johnston Island, US, Outlying Islands (Airport Code) Otterstatter, ShowCase's executive vice president, technology, will lead this group, which will include SPSS and ShowCase product development and technical support departments, as well as the information and computing systems units of both companies. -- Corporate Operations - This group will include the financial, legal, investor relations Investor relations The process by which the corporation communicates with its investors. , human resources The fancy word for "people." The human resources department within an organization, years ago known as the "personnel department," manages the administrative aspects of the employees. , corporate public relations and corporate administrative functions, and is also responsible for processes related to mergers and acquisitions. Edward Hamburg, SPSS executive vice president and CFO, will lead this group, which will be comprised of personnel from both the SPSS and Showcase organizations involved with these activities. "We do not yet plan to change the categories for reporting revenues in our public filings," said CFO Hamburg. "Shareholders and analysts have become very comfortable with the current break-outs, the solutions and technologies pieces are not yet large enough to separate on their own, and we want to make sure these divisions are distinguished correctly before changing things again by introducing new reporting categories." He said, "This will enable the Showcase and market research businesses to be tracked as they are currently, and also allows us to stay with the current definitions of analytical solutions and statistics. Of course, the part of the products business that contributes to the analytical solutions category is primarily the Clementine and SPSS Server offerings and their associated services, which are usually high-ticket high-tick·et adj. Informal Very expensive: "developing a boundless appetite for high-ticket travel" Eileen Keerdoja. Adj. 1. sales made to senior management. The statistics portion is primarily the desktop software products with comparatively low price points that are sold directly to research analysts." 2001 Guidance In the company's pre-announcement press release, Hamburg gave general guidance for expectations in 2001 and said that he would refine this guidance with the regular earnings release that reflected compliance with recent revenue recognition interpretations. He stated, however, that a few more days were required to present such a restated view in a context understandable to investors. "If we were accounting for things as we have since 1993, then I would be giving quarterly break-outs consistent with my earlier suggestion that we would do between $240 and $250 million in revenues and earn around $2.00 next year," he said. "Yet the conventions we adopted, while making some sense, potentially make our business and related performance very difficult to comprehend. Our initial attempts to assess and then model their impact on the coming year showed that this is a complex exercise, and we need the extra time to do it right." Hamburg said that he was planning to release such revised guidance on or before Monday Monday: see week. , February February: see month. 26. SPSS will hold an investor conference call to discuss the contents of this news release on Wednesday Wednesday: see week. , Feb. 21, 2001, at 9:00 a.m. CST CST abbr. 1. Central Standard Time 2. convulsive shock treatment CST Central Standard Time Noun 1. . To participate, please dial 800-569-5033 in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. and (719) 457-2653 internationally. A replay will be available for one week after the call. For access, dial 888-203-1112 in the United States and (719) 457-0820 internationally. Use confirmation code 609572 for the replay. The live call and replay will also be available online at www.spss.com/invest. Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. Statement under the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995 within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended a·mend v. a·mend·ed, a·mend·ing, a·mends v.tr. 1. To change for the better; improve: amended the earlier proposal so as to make it more comprehensive. 2. : Certain statements in this press release are forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. . Such statements can be identified by phrases such as "should be," "planning" and "expects." Such statements also involve known and unknown risks, including market conditions and competition, which may cause the company's actual results, performance, achievements, or industry results, to be materially different than any future results, performance or achievements expressed or implied Inferred from circumstances; known indirectly. In its legal application, the term implied is used in contrast with express, where the intention regarding the subject matter is explicitly and directly indicated. in or by such forward-looking statements. By way of example and not limitation, known risks and uncertainties include changes in: market conditions, especially in Asia; changes and/or and/or conj. Used to indicate that either or both of the items connected by it are involved. Usage Note: And/or is widely used in legal and business writing. product demand and acceptance; the competitive environment; product release schedules; and currency fluctuations. In light of these and other risks and uncertainties, the inclusion of a forward-looking statement in this release should not be regarded as a representation by the company that any future results, performance or achievements will be attained at·tain v. at·tained, at·tain·ing, at·tains v.tr. 1. To gain as an objective; achieve: attain a diploma by hard work. 2. . The company assumes no obligation to update the information contained in this press release. Additional information concerning factors that could cause actual results to materially differ from those in the forward-looking statements is contained in SPSS' periodic reports (copies of which are available from SPSS upon request). About SPSS Inc. SPSS Inc. enables organizations to develop more profitable customer relationships by providing analytical solutions that discover what customers want and predict what they will do. The company delivers analytical solutions at the intersection intersection /in·ter·sec·tion/ (-sek´shun) a site at which one structure crosses another. intersection a site at which one structure crosses another. of customer relationship management and business intelligence. SPSS analytical solutions integrate and analyze an·a·lyze v. 1. To examine methodically by separating into parts and studying their interrelations. 2. To separate a chemical substance into its constituent elements to determine their nature or proportions. 3. market, customer and operational data in key vertical markets worldwide including: telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. , health care, banking, finance, insurance, manufacturing, retail, consumer packaged goods Noun 1. packaged goods - groceries that are packaged for sale foodstuff, grocery - (usually plural) consumer goods sold by a grocer plural, plural form - the form of a word that is used to denote more than one , market research and the public sector. Headquartered in Chicago Chicago, city, United States Chicago (shĭkä`gō, shĭkô`gō), city (1990 pop. 2,783,726), seat of Cook co., NE Ill., on Lake Michigan; inc. 1837. , SPSS has more than 40 offices, over 1000 employees and 2000 pro forma revenues of $158 million. The company also has won the following awards: No. 77 on Forbes Forbes , B(ertie) C(harles) 1880-1954. American publisher and businessman who founded and edited (1916-1954) Forbes magazine. His son Malcolm Stevenson Forbes 2000 list of the "200 Best Small Companies" and No. 12 on the 2000 DM Review 100; placed No. 16 on the 2000 Softletter 100, a ranking of the top 100 personal computer software companies in the United States; and No. 115 in the 2000 Software 500, a ranking of the world's largest software vendors by Software Magazine; listed on Working Mother magazine's "100 Best Companies for Working Mothers" for 2000. For more information, visit www.spss.com.
SPSS Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except for share and per share data)
Pro Forma
Three months ended Year-to-year Percent of
Dec. 31, percent total revenues
2000 1999 % change 2000 1999
Net revenues:
Analytical solutions 9,596 6,074 58% 22% 15%
Market research 11,658 10,778 8% 27% 26%
Statistics 21,972 23,816 -8% 51% 59%
------ ------
Total net revenues 43,226 40,668 6% 100% 100%
Operating expenses:
Cost of revenue 3,296 3,601 -8% 8% 9%
Sales and marketing 22,024 18,907 16% 51% 47%
Product development 7,061 6,478 9% 16% 16%
General and
administrative 2,557 1,766 45% 6% 4%
----- -----
Operating expenses 34,938 30,752 14% 81% 76%
------ ------
Operating income 8,288 9,916 -16% 19% 24%
----- -----
Other income (expense):
Net interest income
(expense) (156) (46) 239% - -
Other income
(expense) 548 (63) -970% 1% -
---- --- ----
Other income (expense) 392 (109) -460% 1% -
--- -----
Income before
income taxes 8,680 9,807 -11% 20% 24%
Income taxes 2,415 3,334 -28% 6% 9%
----- -----
Net income 6,265 6,473 -3% 14% 15%
===== =====
Basic net earnings
per share 0.63 0.67 -6%
Shares used in
basic computation 10,012,396 9,620,838 4%
Diluted earnings
per share 0.60 0.63 -5%
Shares used in diluted
computation 10,453,751 10,226,680 2%
SPSS Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except for share and per share data)
Pro Forma
Twelve months ended Year-to-year Percent of
Dec. 31, percent total revenues
2000 1999 % change 2000 1999
Net revenues:
Analytical solutions 32,383 17,540 85% 20% 12%
Market research 37,449 32,674 15% 24% 23%
Statistics 87,923 91,716 -4% 56% 65%
------ ------
Total net revenues 157,755 141,930 11% 100% 100%
Operating expenses:
Cost of revenue 12,234 12,663 -3% 8% 9%
Sales and marketing 81,181 68,277 19% 51% 48%
Product development 26,613 24,983 7% 17% 18%
General and
administrative 9,213 9,773 -6% 6% 7%
----- -----
Operating expenses 129,241 115,696 12% 82% 82%
------- -------
Operating income 28,514 24,234 9% 18% 18%
------ ------
Other income (expense):
Net interest income
(expense) (642) (529) 21 -1% -
Other income (expense)1,173 157 647% 1% -
----- ---
Other income (expense) 531 (372) -243% - -
--- -----
Income before
income taxes 29,045 23,862 12% 18% 18%
Income taxes 10,154 8,992 13% 6% 6%
------ -----
Net income 18,891 16,870 12% 12% 12%
====== ======
Basic net earnings
per share 1.92 1.76 9%
Shares used in
basic computation 9,824,135 9,594,292 2%
Diluted earnings
per share 1.79 1.66 8%
Shares used in diluted
computation 10,542,441 10,175,576 4%
SPSS Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except for share and per share data)
(subject to audit completion)
Three months Year-to-year Percent of
ended Dec. 31, percent total revenues
2000 1999 % change 2000 1999
Net revenues:
Analytical solutions 9,596 6,074 58% 37% 15%
Market research 11,658 10,778 8% 44% 26%
Statistics 21,972 23,816 -8% 84% 59%
Deferred revenue
adjustment (16,975) - - -65% -
------ ------
Total net revenues 26,251 40,668 -35% 100% 100%
Operating expenses:
Cost of revenue 3,296 3,601 -8% 12% 9%
Sales and marketing 22,024 18,907 16% 84% 47%
Product development 7,061 6,478 9% 27% 16%
General and
administrative 2,557 1,766 45% 10% 4%
Merger-related - 1,611 -100% - 4%
Acquired in-process
technology - 128 -100% - -
---- ---
Operating expenses 34,938 32,491 8% 133% 80%
------ ------
Operating income
(loss) (8,687) 8,177 -206% -33% 20%
----- -----
Other income
(expense):
Net interest income
(expense) (156) (46) 239% -1% -
Other income
(expense) 548 (63) -970% 2% -
--- --
Other income
(expense) 392 (109) -460% 1% -
--- ---
Income (loss) before
income taxes (8,295) 8,068 -203% -32% 20%
Income taxes (4,205) 2,886 -246% 16% 7%
----- -----
Net income (loss) (4,090) 5,182 -179% -16% 13%
===== =====
Basic net earnings
per share -0.41 0.54 -163%
Shares used in basic
computation 10,012,396 9,620,838 4%
Diluted earnings per
share -0.41 0.51 -166%
Shares used in
diluted
computation 10,012,396 10,226,680 -2%
SPSS Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except for share and per share data)
(subject to audit completion)
Twelve months Year-to-year Percent of
ended Dec. 31, percent total revenues
2000 1999 % change 2000 1999
Net revenues:
Analytical solutions 32,383 17,540 85% 23% 12%
Market research 37,449 32,674 15% 27% 23%
Statistics 87,923 91,716 -4% 62% 65%
Deferred revenue
adjustment (16,975) - - -12% -
------ ------
Total net revenues 140,780 141,930 -1% 100% 100%
Operating expenses:
Cost of revenue 12,234 12,663 -3% 9% 9%
Sales and marketing 81,181 68,277 19% 58% 48%
Product development 26,613 26,983 7% 19% 18%
General and
administrative 9,213 9,773 -6% 6% 7%
Merger-related - 1,611 - - -
Acquired in-process
technology - 128 -100% - -
----- ---
Operating expenses 129,241 117,435 10% 92% 82%
------- -------
Operating income 11,539 24,495 -53% 8% 17%
------ ------
Other income
(expense):
Net interest income
(expense) (642) (529) 21% -1% -
Other income
(expense) 1,173 157 647% 1% -
----- ---
Other income
(expense) 531 (372) -243% - -
--- ---
Income before income
taxes 12,070 24,123 -50% 8% 17%
Income taxes 3,534 8,621 -59% 2% 6%
----- -----
Net income 8,536 15,502 -45% 6% 11%
===== ======
Basic net earnings
per share 0.87 1.61 -43%
Shares used in basic
computation 9,824,135 9,600,983 2%
Diluted earnings per
share 0.81 1.52 -44%
Shares used in
diluted
computation 10,542,441 10,191,674 3%
SPSS Inc. and Subsidiaries
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
(subject to audit completion)
Dec. 31, Dec. 31,
2000 1999
ASSETS
Current assets:
Cash and cash equivalents 10,282 16,770
Accounts receivable, net 59,635 42,901
Inventories 4,463 2,895
Deferred tax assets, net 7,027 3,042
Prepaid expenses and
other current assets 8,453 2,833
----- -----
Total current assets 83,860 68,441
Equipment and leasehold
improvements, net 23,474 16,111
Capitalized software
development costs,net 16,225 13,078
Other assets 13,071 9,085
------ -----
Total assets 142,630 106,715
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Notes payable 16,000 9,000
Accounts payable 7,804 5,670
Other current liabilities 14,687 14,001
Deferred revenues 28,794 11,098
Deferred income taxes 749 3,809
Other noncurrent liabilities 1,224 1,595
----- -----
Total liabilities 69,258 45,173
Stockholders' equity 73,372 61,542
------ ------
Total liabilities and
stockholders' equity 142,630 106,715
======= =======
-0- Note: Graphics are available at the following URLs: Revenue from Analytical Solutions: http://www.businesswire.com/cgi-bin/photo.cgi?pw.022101/bb3b Number of Full-Time full-time adj. Employed for or involving a standard number of hours of working time: a full-time administrative assistant. full Employees: http://www.businesswire.com/cgi-bin/photo.cgi?pw.022101/bb3c Number of Sales People: http://www.businesswire.com/cgi-bin/photo.cgi?pw.022101/bb3d SPSS INC. NEW ORGANIZATIONAL STRUCTURE: http://www.businesswire.com/cgi-bin/photo.cgi?pw.022101/bb3a THE NEW SPSS BUSINESS DIVISIONS: http://www.businesswire.com/cgi-bin/photo.cgi?pw.022101/bb3 |
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