ARI Reports Record Revenues for Fiscal 1999; Higher EBITDA; Firm Achieves 14 Quarters of Revenue Growth; 11 Quarters of EBITDA Improvement.MILWAUKEE--(BUSINESS WIRE)--Sept. 30, 1999-- ARI ARI Acute respiratory infection, see there Network Services, Inc. (NASDAQ/NMS:ARIS ARIS American Religious Identification Survey ARIS Architecture of Integrated Information Systems ARIS Active Rack Isolation System ARIS Aggregate Route-based IP Switching ARIS Agentia Romana pentru Investitii Straine ), a leading provider of 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 e-commerce e-commerce, commerce conducted over the Internet, most often via the World Wide Web. E-commerce can apply to purchases made through the Web or to business-to-business activities such as inventory transfers. solutions for manufacturers with shared distribution and service networks, today reported fourth quarter fiscal 1999 revenues of $4.29 million, up 75% from revenues of $2.45 million in the fourth quarter of the previous fiscal year. EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become (earnings before interest, taxes, depreciation and amortization Earnings before interest, taxes, depreciation and amortization (EBITDA) is a non-GAAP metric that can be used to evaluate a company's profitability.
Since there are only seven degrees in a diatonic scale the eleventh degree is the same as the subdominant and the interval straight quarter of EBITDA improvement. For the fiscal year ended July July: see month. 31, 1999, the Milwaukee-based firm reported record revenues of $12.89 million for fiscal 1999, up 62% from $7.96 million in the previous fiscal year. EBITDA for fiscal 1999 was $741,000, a dramatic improvement from EBITDA of $72,000 in the prior year. ARI's net loss was $3.42 million or $0.67 per share in fiscal 1999 compared to $2.14 million or $0.52 per share in the previous fiscal year. "We are extremely pleased with our revenue growth and with the quality of our customer base," commented Brain E. Dearing Dearing, as a name, may refer to:
intr.v. re·curred, re·cur·ring, re·curs 1. To happen, come up, or show up again or repeatedly. 2. To return to one's attention or memory. 3. To return in thought or discourse. revenues were 63% of our annual revenues, indicating a solid base for the future and a predictable revenue stream. With our strong revenue growth, recurring revenue business model and blue chip customer base, ARI is an e-commerce company positioned to deliver continued performance for years to come." Dearing attributed the dramatic revenue growth to the strong penetration of the firm's software in the manufactured equipment markets, particularly in the outdoor power and RV industries. "In the fourth quarter, the equipment markets accounted for more than two-thirds of our revenue," Dearing said. "The majority of our future growth will come from the equipment market. We estimate the total market potential in the US at $2.5 billion in new revenue and $1.2 billion in recurring revenue." Dearing indicated that the increase in the 1999 net loss was driven by non-cash charges Non-Cash Charge A charge off, made by a company against earnings, that does not require an initial outlay of cash. Notes: Non-cash charges are typically against the depreciation, amortization, and depletion accounts on a company's balance sheet. for depreciation, amortization of software and of goodwill from the Company's successful and aggressive acquisition program. "While we've we've Contraction of we have. we've have experienced a short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. impact in terms of paper losses, these acquisitions are investments in long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. growth," Dearing said. "On the other hand, our EBITDA improvement has been very steady. EBITDA has been positive on a trailing 12-month basis for each of the last five quarters, reflecting steady improvement in our operations." Dearing said he believes the firm is positioned for further growth both internally and through acquisitions, and that steady progress toward sustained profitability would continue. "Our acquisition program has been very successful and we are continuing to look at strategic acquisitions that will help us serve the equipment markets where we already have a strong customer base," Dearing said. "Worldwide, we currently have approximately 25,000 customers including world-class world-class adj. 1. Ranking among the foremost in the world; of an international standard of excellence; of the highest order: a world-class figure skater. 2. companies like Fiat New Holland, Stihl Andreas Stihl AG & Company is a manufacturer of chain saws and other handheld power equipment for the outdoors that is headquartered in Waiblingen, Baden-Württemberg. The company was founded in 1926 by Andreas Stihl, an important innovator in early chain saw production. , Briggs Briggs , Henry 1561-1630. English mathematician who devised the decimal-based system of logarithms and invented the modern method of long division. & Stratton and Polaris, just to name a few. Because of non-cash amortization of goodwill, we do not expect to reach full profitability until fiscal 2001. However, we continue to expect positive cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses next year. In the short-term, our focus is on assimilating as·sim·i·late v. as·sim·i·lat·ed, as·sim·i·lat·ing, as·sim·i·lates v.tr. 1. Physiology a. To consume and incorporate (nutrients) into the body after digestion. b. our recent acquisitions and making sure our customers are well prepared for Y2K See Y2K problem and Y2K compliant. Y2K - Year 2000 ." Dearing said that he believed the company has made tremendous strides over the past three to four years and is right at the critical breakthrough point. "Our entire employee force, those in our original operations and those in the companies we've acquired, have done an absolutely phenomenal job of growing the company and in bringing all of our operations together into a solid team to serve our customers," Dearing said. "I salute them for their hard work and dedication." ARI Network Services, Inc., is a provider of Internet e-commerce solutions for manufacturers with shared service and distribution networks. ARI currently serves the manufactured equipment, agribusiness agribusiness Agriculture operated by business; specifically, that part of a modern national economy devoted to the production, processing, and distribution of food and fibre products and byproducts. , freight transportation and newspaper publishing industries. The Company's communications systems In telecommunication, a communications system is a collection of individual communications networks, transmission systems, relay stations, tributary stations, and data terminal equipment (DTE) usually capable of interconnection and interoperation to form an integrated whole. provide an electronic pathway pathway /path·way/ (path´wa) 1. a course usually followed. 2. the nerve structures through which an impulse passes between groups of nerve cells or between the central nervous system and an organ or muscle. for product orders, warranty registrations, sales reports and other transactions between manufacturers and their networks of sales and service points. ARI also builds and manages electronic commerce databases, including electronic parts catalogs Noun 1. parts catalog - a list advertising parts for machinery along with prices parts catalogue catalogue, catalog - a complete list of things; usually arranged systematically; "it does not pretend to be a catalog of his achievements" and industry-common directories of products, companies and locations. Statements in this news release include "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. " within the meaning of 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 . The forward-looking statements can generally be identified by words such as "believes," "anticipates," "expects" or words of similar meaning. Forward-looking statements also include statements relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the Company's future performance, such as future prospects, revenues, profits and cash flows. The forward-looking statements are subject to risks and uncertainties, which may cause actual results to be materially different from any future performance suggested in the forward-looking statements. Such risks and uncertainties include those factors described under "Forward Looking Statements" in the Company's most recent annual report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. or quarterly report on Form 10-Q Form 10-Q See 10-Q. filed with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward-looking statements. The forward-looking statements are made only as of the date hereof here·of adv. Of this. hereof Adverb Formal or law of or concerning this Adv. 1. hereof - of or concerning this; "the twigs hereof are physic" , and the Company undertakes no obligation to publicly release the result of any revisions to these forward-looking statements. For more information, please refer to the Company's filings with the Securities and Exchange Commission. This press release contains Year 2000 readiness disclosures under the Year 2000 Information and Readiness Disclosure Act.
ARI NETWORK SERVICES, INC.
CONDENSED STATEMENT OF OPERATIONS
(in thousands, except per share data)
Twelve months ended
July 31
1999 1998
Net revenues:
Network & other services $8,616 $5,811
Software & development 4,272 2,153
------------------------
12,888 7,964
Operating expenses:
Variable costs of products and services sold
(exclusive of depreciation and
amortization shown below):
Network and other services 1,431 1,327
Software and development 1,720 619
-------------------------
Total variable costs of products and
services sold 3,151 1,946
Depreciation and amortization 3,830 2,142
Network operations 1,017 708
Selling, general and administrative 6,995 4,586
Network construction and expansion 2,786 2,198
-------------------------
Operating expenses before amounts
capitalized 17,779 11,580
Less capitalized expenses(a) (1,802) (1,546)
-------------------------
Total operating expenses 15,977 10,034
-------------------------
Operating income(loss) (3,089) (2,070)
Other income (expense) (326) (70)
-------------------------
Net income(loss) $(3,415) $(2,140)
=========================
Average common shares outstanding 5,061 4,119
Basic and diluted net income(loss)per share ($0.67) ($0.52)
(a) In accordance with FASB 86, includes a portion of network and
product development expense and other operating expenses directly
related to the development process.
See note to unaudited condensed financial statements.
ARI Network Services, Inc.
Balance Sheet
(in thousands, except share and per share data)
July 31 July 31
1999 1998
ASSETS Audited Audited
--------- ---------
Current Assets:
Cash and cash equivalents $127 $194
Accounts receivable
Trade, less allowance for
doubtful accounts of $278 and
$185 in July of 1999 and 1998,
respectively 3,175 2,643
Prepaid expenses 126 118
--------- ---------
Total Current Assets 3,428 2,955
Equipment & leasehold improvements:
Network system hardware 4,246 3,778
Leasehold improvements 239 239
Furniture and equipment 513 485
--------- ---------
4,998 4,502
Less accumulated depreciation
and amortization 4,574 4,107
--------- ---------
Net equipment and leasehold improvements 424 395
Goodwill 8,722 507
Less accumulated amortization 980 171
--------- ---------
7,742 336
Network system:
Network platform 11,467 11,467
Industry-specific applications 22,155 19,906
--------- ---------
33,622 31,373
Less accumulated amortization 24,778 22,251
--------- ---------
8,844 9,122
Total Assets $20,438 $12,808
========= =========
LIABILITIES & SHAREHOLDERS' EQUITY
Current liabilities:
Line of credit payable to shareholder $1,000 $0
Current portion of notes payable 385 28
Accounts payable 1,204 581
Unearned income 3,307 776
Accrued payroll and related expenses 1,091 620
Other accrued expenses 589 158
Current portion of capital lease
obligations 82 30
--------- ---------
Total Current Liabilities 7,658 2,193
Line of credit payable to shareholder 2,000 1,620
Notes payable 734 0
Unearned income 267 0
Capital lease obligations 23 33
Shareholders' equity:
Cumulative preferred stock,
par value $.001 per share,
1,000,000 shares authorized; 20,350
and 20,000 shares issued and
outstanding at July 31, 1999 and
1998, respectively 0 0
Common stock, par value $.001 per
share, 25,000,000 shares authorized;
5,097,432 and 4,247,460 shares issued
and outstanding at July 31, 1999 and
1998, respectively 5 4
Common stock to be issued 2,406 0
Additional paid-in-capital 86,830 85,028
Accumulated deficit (79,485) (76,070)
--------- ---------
Total Shareholders' Equity 9,756 8,962
--------- ---------
Total Liabilities & Shareholders' Equity $20,438 $12,808
========= =========
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