ATG Announces First-Quarter 2003 Results; Company Exceeds Its Quarterly Guidance on Cash; Meets Its Revenue and Bottom-Line Guidance.Business Editors/High-Tech Writers CAMBRIDGE, Mass.--(BUSINESS WIRE)--April 22, 2003 ATG ATG antithymocyte globulin. lymphocyte immune globulin (antithymocyte globulin equine, ATG, ATG equine, LIG) Atgam Pharmacologic class: Immunoglobulin Therapeutic class: Immunosuppressant (Art Technology Group, Inc., NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : ARTG ARTG Australian Register of Therapeutic Goods ) today announced its results for the first quarter ended March 31, 2003. Total revenues for the first quarter of 2003 were $19.4 million, compared with total revenues for the first quarter of 2002 of $27.3 million. Net loss for the first quarter of 2003, in accordance with accounting principles generally accepted 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. (GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). ), was $2.8 million, or ($0.04) per share, compared with a GAAP net loss of $2.8 million, or ($0.04) per share in the first quarter of 2002. ATG's closing balance of cash, cash equivalents and marketable securities Marketable Securities Very liquid securities that can be converted into cash quickly at a reasonable price. Notes: Marketable securities are very liquid as they tend to have maturities less than one year, and the rate at which these securities can be bought or sold has as of March 31, 2003 was $66.6 million, compared with a closing balance of $68.6 million as of December 31, 2002.
FIRST-QUARTER FINANCIAL HIGHLIGHTS
(In millions, except per share data,
and percentages) Three Months Ended
March 31, March 31, December 31,
2003 2002 2002
Total revenues $19.4 $27.3 $24.5
License revenue 7.5 12.5 12.2
Percent of total revenues 39% 46% 50%
Services revenue 11.9 14.8 12.3
Percent of total revenues 61% 54% 50%
Net loss (GAAP) (2.8) (2.8) (20.8)(a)
Net loss per share (GAAP) (0.04) (0.04) (0.30)
Cash, cash equivalents and marketable
securities $66.6 $80.0 $68.6
(a) Includes $19.1 million in restructuring charges
"While it was a difficult market environment and many customers continued to delay IT spending decisions, we again demonstrated value to our customers as they expanded their usage of ATG solutions in the first quarter," said Bob Burke, ATG president and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. . "During the quarter, ATG was successful at further reducing expenses, which enabled the company to preserve its cash balance and get closer to the profitability threshold. ATG reduced its total operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. and total cost of revenues for the quarter to $22.5 million, significantly ahead of previously provided guidance." FIRST-QUARTER HIGHLIGHTS During the first quarter of 2003, ATG: -- Earned repeat business from existing customers, including AOL (A division of Time Warner, Inc., New York, NY, www.aol.com) The world's largest online information service with access to the Internet, e-mail, chat rooms and a variety of databases and services. Time Warner, AT&T Wireless, Blue Cross Blue Shield Blue Shield A US not-for-profit health care insurer that is a reimbursement intermediary for physicians. Cf Blue Cross. , Bunge, DZ Bank, Eastman Kodak, Fira Internacional de Barcelona, GM, Hotels.com, Imation, Kennametal, Readers Digest, Reuters, Royal Mail Group, The United States Army United States Army Major branch of the U.S. military forces, charged with preserving peace and security and defending the nation. The first regular U.S. fighting force, the Continental Army, was organized by the Continental Congress on June 14, 1775, to supplement local , Viacom, Volare Volare is the Latin and Italian word for the verb to fly; adding an acute accent on the final e (volaré) it is also the Spanish word for I will fly. and Warner Music Group Warner Music Group (WMG) is one of the four major record labels. Warner Music Group also has a publishing arm, Warner/Chappell Music, which dates back to 1929, when Jack Warner, president of Warner Bros. Pictures Inc. . -- Added six new customers, including Aspiag, Banka Koper, Citicorp Diners Club Diners Club International, originally founded as Diners Club, is a credit card company formed in 1950 by Frank X. McNamara, Ralph Schneider and Casey R. Taylor. When it first emerged, it became the first independent credit card company in the world. Japan, Franklin Covey, The United States Federal Emergency Management Agency The Federal Emergency Management Agency (FEMA) is the federal agency responsible for coordinating emergency planning, preparedness, risk reduction, response, and recovery. The agency works closely with state and local governments by funding emergency programs and providing technical and The United States Office of Homeland Security Noun 1. Homeland Security - the federal department that administers all matters relating to homeland security Department of Homeland Security executive department - a federal department in the executive branch of the government of the United States . -- Generated three transactions in excess of $1 million, compared with three transactions in excess of $1 million in the first quarter of 2002 and two transactions in excess of $1 million during the fourth quarter of 2002. -- Completed its corporate restructuring efforts announced on January 6, 2003. As part of the headcount and facilities restructuring, ATG reduced its worldwide workforce by approximately 20%. -- Hosted the ATG Open in Miami, Florida “Miami” redirects here. For the Native American tribe, see Miami tribe. Miami is a major city in southeastern Florida, in the United States. It is the county seat of Miami-Dade County. Miami is a gamma world city with an estimated population of 404,048. in January. The ATG Open, a conference for the ATG user community and ATG partners, was a tremendous success, with over 400 attendees. OUTLOOK ATG has a strong pipeline of potential business and anticipates sequential revenue growth in the second quarter of 2003. Additionally, ATG is anticipating total operating expenses and total cost of revenues to be in the range of $21 million to $22.5 million, and that as of June 30, 2003, its balance of cash, cash equivalents and marketable securities will be in the range of $60 million to $63 million. CONFERENCE CALL INFORMATION ATG management will discuss the company's first-quarter 2003 results, its business outlook for the second quarter 2003 as well as other topics on its quarterly conference call for investors at 5:30 p.m. EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT today, April 22, 2003. The conference call will be broadcast live over the Internet. Investors interested in listening to the Webcast should log onto the "Investor Relations Investor relations The process by which the corporation communicates with its investors. " section of ATG's Web site, located at www.atg.com, at least 15 minutes prior to the event's broadcast. ABOUT ATG ATG (Art Technology Group, Inc.) is a leading provider of innovative software applications for commerce and customer self-service. Customers around the globe rely on ATG for the frontline applications that help build and manage mutually beneficial Adj. 1. mutually beneficial - mutually dependent interdependent, mutualist dependent - relying on or requiring a person or thing for support, supply, or what is needed; "dependent children"; "dependent on moisture" relationships. Deployed on the industry's most popular application servers, ATG's application suites for e-commerce, portals, and relationship management are ideal for integrated e-business initiatives across the enterprise. ATG has delivered e-business solutions to blue-chip companies worldwide including Aetna Services, Inc., Alcatel, American Airlines American Airlines Major U.S. airline. American was created through a merger of several smaller U.S. airlines and incorporated in 1934. It continued to buy the routes of other airlines, becoming an international carrier in the 1970s; its routes include South America, the , Barclays Global Investors Barclays Global Investors is a subsidiary of British-based Barclays Bank which is in the investment management industry. It is the largest corporate money manager in the world, with over £936 billion (US$1.77 trillion) under management as of March 2006[1]. , Best Buy, BMG BMG Bundesministerium für Gesundheit (Germand: Federal Ministry for Health) BMG Be My Girl BMG Blue Man Group BMG Bertelsmann Music Group BMG Be My Guest BMG Browning Machine Gun BMG Bulk Metallic Glass Direct, Eastman Kodak, Ford Motor Credit, HSBC HSBC Hongkong and Shanghai Banking Corporation HSBC Humane Society of Broward County (Florida) HSBC Humane Society of Bay County (Bay County, Michigan) , J. Crew, Sun Microsystems, Walgreen Company, and Wells Fargo. The company is headquartered in Cambridge, Massachusetts, with additional locations throughout North America, Europe, and Asia. For more information about ATG, please visit our Web site at www.atg.com. (C) 2003 Art Technology Group, Inc. ATG and Art Technology Group are registered trademarks of Art Technology Group, Inc. All other product names, service marks, and trademarks mentioned herein are trademarks of their respective owners. The statements in the paragraph in the section labeled "Outlook" of this press release include forward-looking statements. These statements involve known and unknown risks and uncertainties that may cause ATG's actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. These risks include the effect of weakened or weakening economic conditions or perceived conditions on the level of spending by customers and prospective customers for ATG's software and services; financial and other effects of cost control measures, quarterly fluctuations in ATG's revenues or other operating results; customization and deployment delays or errors associated with ATG's products; the result of longer sales cycles for ATG's products; satisfaction levels of customers regarding the implementation and performance of ATG's products; ATG's need to maintain and enhance business relationships with resellers and other parties who may be affected by changes in the economic climate; ATG's abilities to attract and maintain qualified executives and other personnel and to motivate employees; activities by ATG and others related to protection of intellectual property; potential adverse financial and other effects of litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. and the release of competitive products and other activities by competitors. Further details on these risks are set forth in ATG's filings with the Securities and Exchange Commission, which are available on a Web site maintained by the Securities and Exchange Commission at http://www.sec.gov.
Art Technology Group, Inc.
Condensed Consolidated Statement of Operations
(In thousands, except per share data)
(Unaudited)
Three Months Ended
March 31, March 31,
2003 2002
Revenues:
Product license $7,505 $12,520
Services 11,920 14,803
Total revenues 19,425 27,323
Cost of revenues:
Product license 485 1,043
Services 5,706 8,975
Total cost of revenues 6,191 10,018
Gross profit 13,234 17,305
Gross profit % 68% 63%
Operating expenses:
Research & development 4,860 5,570
Sales & marketing 8,768 12,378
General & administrative 2,640 2,490
Stock-based compensation 81 271
Total operating expenses 16,349 20,709
Loss from operations (3,115) (3,404)
Interest and other income, net 361 555
Net loss before provision for income
taxes (2,754) (2,849)
Provision for income taxes - -
Net loss $(2,754) $(2,849)
Basic and diluted net loss per share $(0.04) $(0.04)
Basic and diluted weighted average
common shares outstanding 70,982 69,494
Art Technology Group, Inc.
Condensed Consolidated Balance Sheets
(In thousands)
(Unaudited)
As of the period ended
March 31, December 31,
2003 2002
Assets
Current assets:
Cash, cash equivalents and marketable
securities $66,639 $68,558
Accounts receivable, net 17,857 25,221
Prepaid expenses and other current assets 2,661 2,489
Total current assets 87,157 96,268
Property and equipment, net 5,491 6,998
Other assets 1,409 1,569
Total assets $94,057 $104,835
Liabilities and stockholders' Equity
Current liabilities:
Accounts payable $2,166 $2,563
Accrued expenses 14,654 18,219
Deferred revenue 16,172 15,674
Accrued restructuring short-term 16,698 19,819
Total current liabilities 49,690 56,275
Accrued restructuring long-term 31,001 32,537
Stockholders' equity 13,366 16,023
Total liabilities and stockholders'
equity $94,057 $104,835
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