Accelrys Announces Fiscal 2006 Financial Results; Net Loss Reduced by Over 50%; Positive Operating Cash Flow of $5.8 Million; Company Completes Restatement of Historical Financial Statements.SAN DIEGO San Diego (săn dēā`gō), city (1990 pop. 1,110,549), seat of San Diego co., S Calif., on San Diego Bay; inc. 1850. San Diego includes the unincorporated communities of La Jolla and Spring Valley. Coronado is across the bay. -- Accelrys Accelrys (NASDAQ: ACCL) is a San Diego, United States-based software company specializing in research software for bioinformatics, cheminformatics, molecular simulation, and quantum mechanics. , 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 :ACCL ACCL American Canadian Caribbean Line ACCL Acceleration ACCL American College of Construction Lawyers ACCL Accreditation Council for Clinical Lipidology (Allied Health Certification Program) ACCL Amway China Co Limited ) today reported financial results for the quarter and fiscal year ended March 31, 2006 and for the quarter and nine-month period ended December December: see month. 31, 2005. The Company also announced that it has completed the restatement Restatement A revision in a company's earlier financial statements. Notes: The need for restating financial figures can result from fraud, misrepresentation, or a simple clerical error. of its historical financial statements and filed its Quarterly Report on Form 10-Q Form 10-Q See 10-Q. for the fiscal quarter ended December 31, 2005 and its 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. for the fiscal year ended March 31, 2006. The financial results included in this press release reflect the restatement for all periods presented. Fiscal 2006 Results Revenue for the fiscal year ended March 31, 2006 was $82.0 million, an increase of 4% from $79.0 million for the fiscal year ended March 31, 2005. The increase in revenue reflects organic growth in sales of the Company's platform and solutions offerings as well as the additive effect additive effect n. An effect in which two substances or actions used in combination produce a total effect the same as the sum of the individual effects. of a full year of revenue from our SciTegic SciTegic is a San Diego-based software company that develops and markets informatics software to the pharmaceutical and biotechnology industries. It was founded in February, 1999 by Mathew Hahn and David Rogers. subsidiary included in fiscal year 2006, as compared to only six months of SciTegic revenues included in fiscal year 2005. These increases in revenue were partially offset by continued declines in sales of some of our traditional modeling and simulation The mathematical representation of the interaction of real-world objects. See scientific application and simulator. Simulation A broad collection of methods used to study and analyze the behavior and performance of actual or theoretical systems. products to life sciences companies. "We are very pleased with our financial performance in fiscal 2006," said Mark J. Emkjer, Accelrys President and Chief Executive Officer. "We reported revenue growth, reduced our net loss by over 50 percent, and generated positive cash flow. In addition, our deferred revenue and backlog Backlog The total value of sales orders waiting to be fulfilled. Notes: This figure is used mainly in the manufacturing industry. Increases or decreases in a company's backlog indicate the future direction of sales and earnings. of signed, multi-year customer contracts continues to grow, reflecting the increased confidence our customers have in Accelrys. We are particularly pleased that our strategic focus on providing platform and solutions offerings resulted in increased revenue during the year. We continue to believe that these offerings represent a significant growth opportunity." Total operating costs operating costs npl → gastos mpl operacionales and expenses for the fiscal year ended March 31, 2006 were $90.7 million compared to $96.8 million for the fiscal year ended March 31, 2005. Included in total operating costs and expenses were severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when and lease abandonment abandonment, in law, voluntary, intentional, and absolute relinquishment of rights or property without conveying them to any other person. Abandonment also means willfully leaving one's spouse or children, intending not to return (see desertion). costs of $3.2 million in fiscal 2006 and $5.1 million in fiscal 2005. Fiscal 2006 also included $1.1 million in professional services (job) professional services - A department of a supplier providing consultancy and programming manpower for the supplier's products. costs related to the restatement, while fiscal 2005 expenses also included $0.5 million in costs associated with the acquisition of SciTegic, Inc. Excluding the impact of these costs, total operating costs and expenses declined 5% from the prior year. The Company reported a loss from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the of $(7.7) million, or $(0.30) per share for the fiscal year ended March 31, 2006 compared to a loss from continuing operations of $(15.5) million, or $(0.62) per share, for the fiscal year ended March 31, 2005. Excluding the severance, lease abandonment, restatement and acquisition costs from both fiscal years, the Years, The the seven decades of Eleanor Pargiter’s life. [Br. Lit.: Benét, 1109] See : Time loss from continuing operations narrowed to $(3.5) million in fiscal 2006, from $(9.9) million in fiscal 2005. The Company reported a net loss of $(7.7) million, or $(0.30) per share, for the fiscal year ended March 31, 2006 compared to a net loss of $(16.6) million, or $(0.66) per share, for the fiscal year ended March 31, 2005. The net loss in fiscal 2005 included a net loss from discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. of $(1.1) million, or $(0.04) per share. There were no discontinued operations in fiscal 2006. The Company reported total cash, restricted cash and investments of $66.0 million at March 31, 2006, up from $63.3 million at March 31, 2005. The Company also reported positive operating cash flow Operating cash flow Earnings before depreciation minus taxes. Measures the cash generated from operations, not counting capital spending or working capital requirements. of $5.8 million for the fiscal year ended March 31, 2006 as compared to negative operating cash flow of $(14.2) million for the fiscal year ended March 31, 2005. In addition, total deferred revenue increased to $61.3 million at March 31, 2006, up from $58.6 million at March 31, 2005. Fourth Quarter Fiscal 2006 Results Revenue for the quarter ended March 31, 2006 was $19.4 million, down from $20.9 million for the quarter ended March 31, 2005. The decrease in revenue is due to lower order levels earlier in fiscal 2006, which, due to our ratable That which can be appraised, assessed, or adjusted through the application of a formula or percentage. Ratable property is that which is taxable or capable of being appraised or assessed. ratable adj. revenue recognition policy, negatively impacted revenue in the fourth fiscal quarter. However, orders in the fourth quarter were strong, and we ended the year with higher levels of deferred revenue than a year ago. Total operating costs and expenses for the quarter ended March 31, 2006 were $25.8 million compared to $29.5 million for the quarter ended March 31, 2005. Included in total operating costs and expenses were severance and lease abandonment costs of $3.2 million in the fourth quarter of fiscal 2006 and $1.5 million in the fourth quarter of fiscal 2005. The fourth quarter of fiscal 2006 also included $1.1 million in professional services costs related to the restatement. Excluding the impact of these costs, total operating costs and expenses were $21.5 million for the quarter ended March 31, 2006, a 23% reduction from $28.0 million in the same quarter of last year. The Company reported a net loss of $(6.4) million, or $(0.25) per share for the quarter ended March 31, 2006 compared to a net loss of $(7.3) million, or $(0.28) per share, for the quarter ended March 31, 2005. Excluding the severance, lease abandonment and restatement costs from both quarters, the net loss narrowed to $(2.1) million in fiscal 2006, from $(5.8) million in fiscal 2005. Restatement The Company also announced today that it has completed the restatement of its historical financial statements and is now current in its filings with the SEC. As a result, the Company expects to receive notification that it is compliant
Requirements, including minimum shares outstanding, market value, and income, that are laid down by an exchange for any stock to be listed for trading. . The restated consolidated financial statements Consolidated Financial Statements The combined financial statements of a parent company and its subsidiaries. Notes: Because consolidated financial statements present an aggregated look at the financial position of a parent and its subsidiaries, they enable you to gauge reflect changes to the timing of revenue recognized under term-based and perpetual PERPETUAL. That which is to last without limitation as to time; as, a perpetual statute, which is one without limit as to time, although not expressed to be so. software license arrangements which include multiple elements (typically software licenses In computing, software that is copyrighted and licensed under a software license is done under a variety of licensing schemes. For end-users there are proprietary licenses and there are free software licenses, and there are proprietary Within these schemes are further classifications. and post-contract customer support, referred to as "PCS (1) (Personal Communications Services) Refers to wireless services that emerged after the U.S. government auctioned commercial licenses in 1994 and 1995. This radio spectrum in the 1. ") and a change in accounting for software development costs. The restated consolidated financial statements also reflect the reclassification Reclassification The process of changing the class of mutual funds once certain requirements have been met. These requirements are generally placed on load mutual funds. Reclassification is not considered to be a taxable event. of general and administrative expenses and interest income between continuing and discontinued operations, the reclassification of cash flows from discontinued operations as net cash provided by (used in) discontinued dis·con·tin·ue v. dis·con·tin·ued, dis·con·tin·u·ing, dis·con·tin·ues v.tr. 1. To stop doing or providing (something); end or abandon: operating, investing and financing activities, as opposed op·pose v. op·posed, op·pos·ing, op·pos·es v.tr. 1. To be in contention or conflict with: oppose the enemy force. 2. to a single line item as previously reported, and the reclassification of investments in auction rate securities to 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 from cash and cash equivalents. The Company also noted that following review and consultation with the SEC, no restatement adjustments are required for the Company's term-based, subscription software license contracts entered into after January January: see month. 2004. The nature of the restatement adjustments and the impact of the restatement on the Company's previously issued consolidated financial statements are described more fully in Note 2 to the restated consolidated financial statements and in "Management's Discussion and Analysis Management's discussion and analysis (MD&A) A report from management to shareholders that accompanies the firm's financial statements in the annual report. It explains the period's financial results and enables management to discuss topics that may not be apparent in the financial of Financial Condition and Results of Operations" included in the Company's Annual Report on Form 10-K for the year ended March 31, 2006. In summary, the restatement adjustments relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc revenue recognition resulted in ratable revenue recognition for the majority of our historical software license contracts. Since the adjustments were solely related to the timing of revenue recognition, the total revenue and profits associated with the contracts remain the same over the life of the contracts. The restated financial statements now reflect higher levels of deferred revenue at the end of each of the previously reported three fiscal periods included in our Annual Report on Form 10-K, and higher reported revenue and reduced losses from continuing operations in each of those three periods. The restated financial statements also reflect reduced net losses in two of those three periods. The following table presents the impact of the restatement on revenue, total operating costs and expenses, loss from continuing operations, loss from discontinued operations, net loss, total deferred revenue and accumulated ac·cu·mu·late v. ac·cu·mu·lat·ed, ac·cu·mu·lat·ing, ac·cu·mu·lates v.tr. To gather or pile up; amass. See Synonyms at gather. v.intr. To mount up; increase. deficit for the previously reported three fiscal periods (in thousands):
Fiscal Three Fiscal
year months year
ended ended ended
March March December
31, 31, 31,
2005 2004 2003
-------- -------- ---------
Increase in "Revenue" $9,399 $8,224 $648
Decrease (increase) in "Total operating
costs and expenses" (805) 424 (197)
Decrease in "Loss from continuing
operations" 8,594 8,648 451
Decrease (increase) in "Loss from
discontinued operations" 0 (538) (1,550)
Decrease (increase) in "Net loss" 8,594 8,110 (1,099)
At At At
March March December
31, 31, 31,
2005 2004 2003
-------- -------- ---------
Increase in "Total deferred revenue" $16,018 $25,417 $33,641
(Increase) in "Accumulated deficit" (24,157) (32,751) (40,861)
Non-GAAP Measures This press release includes certain non-GAAP financial measures as outlined below. The Company believes the non-GAAP measures of total costs and expenses and loss from continuing operations adjusted to exclude the effect of acquisition, restatement, severance and lease abandonment costs are useful for evaluating the operating performance of the Company because this information provides investors and others with a measure of operating results which allows for ease of comparison with historical results and with the results of other companies, and provides insight into on-going Adj. 1. on-going - currently happening; "an ongoing economic crisis" ongoing current - occurring in or belonging to the present time; "current events"; "the current topic"; "current negotiations"; "current psychoanalytic theories"; "the ship's current position" performance. Further, the Company's management and Board of Directors utilize these measures when evaluating and comparing the Company's performance against internal financial forecasts and budgets. The non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). . These non-GAAP financial measures may be different from non-GAAP financial measures used by other companies. The following table contains a reconciliation of these measures to the Company's GAAP results (in thousands):
Three Three Fiscal Fiscal
months months year year
ended ended ended ended
March March March March
31, 31, 31, 31,
2006 2005 2006 2005
-------- -------- -------- ---------
GAAP Total costs and expenses $25,809 $29,497 $90,711 $96,800
Less: Severance and lease
abandonment expenses (3,182) (1,497) (3,178) (5,110)
Less: Restatement costs (1,099) -- (1,099) --
Less: Acquisition related
expenses -- -- -- (450)
-------- -------- -------- ---------
Non-GAAP Total costs and expenses $21,528 $28,000 $86,434 $91,240
GAAP Loss from continuing
operations $(6,427) $(7,301) $(7,739) $(15,461)
Add back: Severance and lease
abandonment expenses 3,182 1,497 3,178 5,110
Add back: Restatement costs 1,099 -- 1,099 --
Add back: Acquisition related
expenses -- -- -- 450
-------- -------- -------- ---------
Non-GAAP Loss from continuing
operations $(2,146) $(5,804) $(3,462) $(9,901)
Conference Call Details At 5:00 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, Accelrys will conduct a conference call to discuss its fiscal 2006 financial results and the restatement. To participate, please dial 1-866-510-0708 (1-617-597-5377 outside 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 enter the access code, 55736528, approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 15 minutes before the scheduled start of the call. The conference call will also be accessible live on the Investor Relations Investor relations The process by which the corporation communicates with its investors. section of the Accelrys website at www.accelrys.com. A replay of the conference call will be available online at www.accelrys.com and via telephone by dialing 1-888-286-8010 (1-617-801-6888 outside the United States) and entering access code 25066868 from 7:00 p.m. ET May 24, through 11:59 p.m. ET, June June: see month. 23, 2006. About Accelrys Accelrys, Inc. (ACCL) is a leading provider of software for computation Computation is a general term for any type of information processing that can be represented mathematically. This includes phenomena ranging from simple calculations to human thinking. , simulation, and the management and mining of scientific data used by biologists, chemists This is a list of famous chemists: (alphabetical order) : Top - 0–9 A B C D E F G H I J K L M N O P Q R S T U V W X Y Z A
nanotechnology Manipulation of atoms, molecules, and materials to form structures on the scale of nanometres (billionths of a metre). researchers for product design as well as drug discovery and development. Accelrys technology and services are designed to meet the needs of today's leading research organizations. The company is headquartered in San Diego, California “San Diego” redirects here. For other uses, see San Diego (disambiguation). San Diego is a coastal Southern California city located in the southwestern corner of the continental United States. As of 2006, the city has a population of 1,256,951. . Its materials research and development team is based at its European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. Headquarters and Centre of Excellence in Cambridge Cambridge, city, Canada Cambridge (kām`brĭj), city (1991 pop. 92,772), S Ont., Canada, on the Grand River, NW of Hamilton. It was formed in 1973 with the amalgamation of Galt, Hespeler, and Preston, all founded in the early 19th cent. , UK. For more information see http://www.accelrys.com/. 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. Statements contained in this press release relating to the Company's or management's intentions, hopes, beliefs, expectations or predictions of the future, including statements relating to the growth in backlog, deferred revenue and customer confidence as well as statements regarding growth opportunities and notification from NASDAQ that the Company is compliant with its listing requirements, are forward-looking statements. The Company's actual results could differ materially from those projected in these forward looking statements due to a number of factors, including without limitation, the successful release and customer acceptance of new products and demand for the Company's new and existing products, as well as NASDAQ's concurrence CONCURRENCE, French law. The equality of rights, or privilege which several persons-have over the same thing; as, for example, the right which two judgment creditors, Whose judgments were rendered at the same time, have to be paid out of the proceeds of real estate bound by them. Dict. de Jur. h.t. with the Company regarding the Company's compliance with NASDAQ's listing requirements. Additional information concerning factors that could cause actual results to differ materially from those in the forward-looking statements is contained from time to time in the Company's SEC filings, including but not limited to the Company's Annual Report on Form 10-K for the year ended March 31, 2006. The Company disclaims any intention or obligation to revise any forward-looking statements whether as a result of new information, future events or otherwise.
ACCELRYS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
THREE MONTHS AND YEARS ENDED MARCH 31, 2006 AND 2005
(In thousands, except per share amounts)
Three Months Ended Years Ended
------------------- -------------------
March 31, March 31, March 31, March 31,
2006 2005 2006 2005
-------- ---------- -------- ----------
(Restated) (Restated)
Revenue $19,429 $20,892 $82,001 $79,030
Operating costs and expenses:
Cost of revenue 4,426 4,834 17,095 14,317
Product development 5,347 6,135 21,721 22,717
Sales and marketing 8,097 11,568 32,657 36,916
General and administrative 4,757 5,463 16,060 17,290
Severance and lease
abandonment charges 3,182 1,497 3,178 5,110
Acquired in-process product
development -- -- -- 450
-------- ---------- -------- ----------
Total operating costs and
expenses 25,809 29,497 90,711 96,800
-------- ---------- -------- ----------
Operating loss from continuing
operations (6,380) (8,605) (8,710) (17,770)
Interest and other income, net 239 481 1,869 1,738
-------- ---------- -------- ----------
Loss from continuing operations
before taxes (6,141) (8,124) (6,841) (16,032)
Income tax expense (benefit) 286 (823) 898 (571)
-------- ---------- -------- ----------
Loss from continuing operations (6,427) (7,301) (7,739) (15,461)
Loss from discontinued
operations -- -- -- (1,117)
-------- ---------- -------- ----------
Net loss $(6,427) $(7,301) $(7,739) $(16,578)
======== ========== ======== ==========
Basic and diluted loss per
share amounts:
Loss from continuing operations $(0.25) $(0.28) $(0.30) $(0.62)
Loss from discontinued
operations -- -- -- (0.04)
-------- ---------- -------- ----------
Net loss $(0.25) $(0.28) $(0.30) $(0.66)
======== ========== ======== ==========
Weighted averaged shares used
to compute basic and diluted
loss per share amounts 26,195 25,920 26,116 25,137
ACCELRYS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
THREE AND NINE MONTHS ENDED DECEMBER 31, 2005 AND 2004
(In thousands, except per share amounts)
Three Months Ended Nine Months Ended
------------------- -------------------
December December December December
31, 31, 31, 31,
2005 2004 2005 2004
-------- ---------- -------- ----------
(Restated) (Restated)
Revenue $20,433 $19,600 $62,572 $58,138
Operating costs and expenses:
Cost of revenue 4,361 4,210 12,669 9,483
Product development 4,952 6,409 16,374 16,582
Sales and marketing 8,675 10,109 24,560 25,348
General and administrative 3,612 4,139 11,304 11,827
Severance and lease
abandonment charges
(recoveries) -- 3,612 (4) 3,612
Acquired in-process product
development -- (250) -- 450
-------- ---------- -------- ----------
Total operating costs and
expenses 21,600 28,229 64,903 67,302
-------- ---------- -------- ----------
Operating loss from continuing
operations (1,167) (8,629) (2,331) (9,164)
Interest and other income, net 530 184 1,630 1,257
-------- ---------- -------- ----------
Loss from continuing operations
before taxes (637) (8,445) (701) (7,907)
Income tax expense (benefit) (70) (362) 611 252
-------- ---------- -------- ----------
Loss from continuing operations (567) (8,083) (1,312) (8,159)
Loss from discontinued
operations -- -- -- (1,117)
-------- ---------- -------- ----------
Net loss $(567) $(8,083) $(1,312) $(9,276)
======== ========== ======== ==========
Basic and diluted loss per
share amounts:
Loss from continuing operations $(0.02) $(0.31) $(0.05) $(0.33)
Loss from discontinued
operations -- -- -- (0.04)
-------- ---------- -------- ----------
Net loss $(0.02) $(0.31) $(0.05) $(0.37)
======== ========== ======== ==========
Weighted averaged shares used
to compute basic and diluted
loss per share amounts 26,143 25,841 26,090 24,876
ACCELRYS, INC.
CONSOLIDATED BALANCE SHEET INFORMATION
AS OF MARCH 31, 2006 AND 2005
(In thousands)
March 31,
--------------------
2006 2005
--------- ----------
(Restated)
Assets
Cash, cash equivalents, restricted cash and
marketable securities $66,022 $63,304
Trade receivables, net 17,289 20,006
Other assets, net 63,444 69,105
--------- ----------
Total assets $146,755 $152,415
========= ==========
Liabilities and stockholders' equity
Current liabilities, excluding deferred revenue 16,536 19,074
Total deferred revenue 61,269 58,614
Noncurrent liabilities, excluding deferred revenue 5,742 5,131
Total stockholders' equity 63,208 69,596
--------- ----------
Total liabilities and stockholders' equity $146,755 $152,415
========= ==========
ACCELRYS, INC.
CONSOLIDATED BALANCE SHEET INFORMATION
AS OF DECEMBER 31, 2005 AND MARCH 31, 2005
(In thousands)
December 31, March 31,
2005 2005
----------- ----------
(Restated)
Assets
Cash, cash equivalents, restricted cash and
marketable securities $50,079 $63,304
Trade receivables, net 37,434 20,006
Other assets, net 64,181 69,105
--------- ----------
Total assets $151,694 $152,415
========= ==========
Liabilities and stockholders' equity
Current liabilities, excluding deferred revenue 15,715 19,074
Total deferred revenue 61,765 58,614
Noncurrent liabilities, excluding deferred revenue 5,018 5,131
Total stockholders' equity 69,196 69,596
--------- ----------
Total liabilities and stockholders' equity $151,694 $152,415
========= ==========
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