Actuate Reports Third Quarter Financial Results; Q3 Pro Forma EPS of $0.03 and Expanding Operating Margins.Business Editors/High-Tech Writers SOUTH SAN FRANCISCO South San Francisco, city (1990 pop. 54,312), San Mateo co., W Calif.; inc. 1908. South San Francisco has several industrial parks; its manufactures include medical supplies and equipment, foods, paint, paper products, consumer goods, and clothing. , Calif.--(BUSINESS WIRE)--Oct. 24, 2002 Actuate(R) Corporation (Nasdaq:ACTU ACTU Australian Council of Trade Unions ACTU AIDS Clinical Trials Unit (Washington University Medical Center, St. Louis, Missouri) ACTU Association of Catholic Trade Unionists ACTU Australian Capital Territory Union ), the Information Delivery market leader, today announced revenues and earnings for the third quarter of fiscal 2002. Revenues for the third quarter totaled $25.6 million, compared with $28.2 million reported in the third quarter of 2001 and $27.5 million reported in the second quarter of 2002. Excluding restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). costs and amortization of other intangibles, 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 income from operations in the third quarter of 2002 was $2.3 million, an increase of $0.8 million compared with the second quarter of 2002. Pro forma 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 were $0.03 for the third quarter of 2002 (See Table A), an increase of $0.01 from the second quarter of 2002. Actual 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. loss per share was $0.43 for the third quarter of 2002 (See Table B), primarily the result of a $26.2 million restructuring charge restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. . Cash, cash equivalents and short-term investments at the end of the quarter were $42.7 million, a decrease of $1.7 million primarily due to the repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. of $4.2 million worth of Actuate stock during the third quarter. Days sales outstanding In accountancy, Days Sales Outstanding is a company's average collection period. A low figure indicates that the company collects its outstanding receivables quickly. Typically it is looked at either quarterly or yearly (90 or 365 days). ended the quarter at 81 days, down 5 days from the second quarter of 2002. "The third quarter was another solid financial quarter for Actuate. Once again we were profitable on a pro forma basis and had 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 . We maintained a healthy balance sheet and our operating margins Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: continued their upward trajectory Trajectory The curve described by a body moving through space, as of a meteor through the atmosphere, a planet around the Sun, a projectile fired from a gun, or a rocket in flight. to 9% of revenues. In addition, we are doing the right thing for shareholders by continuing to repurchase Actuate stock," said Pete Cittadini, Actuate's president and chief executive officer. "We believe we are crafting a winning business model for these challenging times and look forward to being one of the most profitable companies in the software industry when IT spending levels improve." Actuate recorded a restructuring charge of $26.2 million during the third quarter of 2002. This charge consisted of a $24.8 million idle facility charge and $1.4 million in costs related to the reduction of our worldwide workforce. "Actuate's best-of-breed Information Delivery platform continues to generate excitement in the market. Many IT managers are realizing that an important part of today's corporate cost-containment strategy is the deployment of sophisticated information-based applications that help to lower operational costs and improve operational efficiencies," continued Cittadini. "Increasingly, IT managers consider Actuate's Information Delivery platform a high-value component of their strategic toolkit as they seek to increase returns from their existing investments in software and hardware." Significant Q3 accomplishments for Actuate included the following: -- Added over 100 new customers; -- Increased pro forma EPS to $0.03; -- Achieved $1.4 million positive cash flow from operations; -- Increased pro forma operating income to 9% of revenues, an increase of 162% from Q3 2001; -- Repurchased $4.2 million worth of Actuate stock; -- Decreased days sales outstanding to 81 days from 86 days in Q2 2002. During Q3, Actuate added over 100 new customers, a reflection of the strong market acceptance of Actuate 6. The company continued to expand its Global 2000 customer base across a wide variety of industry segments, particularly automotive, chemicals, engineering, government, high-technology and pharmaceuticals. New customers added in Q3 include, among others, Coca-Cola Enterprises Coca-Cola Enterprises NYSE: CCE is the largest bottler by volume in the Coca-Cola System. It is the anchor bottler for North America and parts of Europe. The company is the bottler of Coca-Cola and its other soft drink products, and in some areas a few other soft drink , Deloitte & Touche, Eastman Chemical, General Motors, Gerard Klauer Mattison, Halifax Corporation, Johnson Controls Johnson Controls, Inc. (NYSE: JCI) is a United States company, based in Milwaukee, Wisconsin, specializing in the design, manufacturing, and installation of automotive systems, automotive batteries (Optima[1] based in Denver, Colorado) and climate control systems. , Lawrence Berkeley National Laboratory Lawrence Berkeley National Laboratory and Lawrence Livermore National Laboratory, scientific research centers run by the Univ. of California, located in Berkeley, Calif., and Livermore, Calif., respectively. , Maryland Hospital Association, Procter & Gamble, State of Wyoming, Unilever Bestfoods and Union Bank of California Union Bank of California is one of the 30 largest commercial banks in the United States. It has 327 branches, the majority of which are in San Diego, Los Angeles and Orange Counties. . Sizable siz·a·ble also size·a·ble adj. Of considerable size; fairly large. siz  a·ble·ness n. repeat orders were received from American Express American Express (NYSE: AXP), sometimes known as "AmEx" or "Amex", is a diversified global financial services company, headquartered in New York City. The company is best known for its credit card, charge card and traveler's cheque businesses. , BISYS
Fund Services, Citibank, Deutsche Bank Deutsche Bank AG (IPA: /'dɔɪ.tʃə/[1]) (ISIN: DE0005140008, NYSE: DB) (English: German Bank , Fannie Mae Fannie Mae: see Federal National Mortgage Association. , Global Crossing,
J.P. Morgan Chase, Lehman Brothers Lehman Brothers Holdings Inc. (NYSE: LEH), founded in 1850, is a diversified, global financial services firm. It is a participant in investment banking, equity and fixed income sales, research and trading, investment management, private equity, and private banking. , Ortho-McNeil Pharmaceuticals Ortho-McNeil Pharmaceutical, inc. is a pharmaceutical manufacturer based in Raritan, New Jersey, and a subsidiary of Johnson & Johnson. The company was formed from the merger of Ortho Pharmaceutical and McNeil Pharmaceutical in 1993. ,
Salomon Smith Barney Smith Barney is a division of Citigroup Global Capital Markets Inc., a global, full-service financial firm, that provides brokerage, investment banking and asset management services to corporations, governments and individuals around the world. , State Street Corporation, TRX TRX TransceiverTRX Transaction TRx Total Prescription TRX Token Ring Switch TRX Transmit and Receive and Wells Fargo Wells Fargo armored carriers of bullion. [Am. Hist.: Brewer Dictionary, 1147] See : Protectiveness Wells Fargo company that handled express service to western states; often robbed. [Am. Hist. , among other companies. Internationally, Actuate won significant business from, among others, Aristo Decision Systems, Barclays Capital Barclays Capital is the investment banking division of Barclays plc. It is a primary dealer in U.S. Treasury securities and various European Government bonds. Barclays Capital is led by CEO Robert (Bob) Diamond, an American who had been vice-chairman of Credit Suisse First , British Telecom The telephone and communications carrier that provides services in Great Britain and Northern Ireland. It used to be a division of the British Post Office, but was privatized in 1984 under Margaret Thatcher's administration. , Credit Agricole Asset Management, Dimension Data, Deutsche Bank, France Telecom, and UBS UBS Union Bank of Switzerland UBS United Bible Societies UBS United Blood Services UBS United Buying Service UBS Used Bookstore UBS University Business Services UBS Universal Building Society (UK) UBS Ulaanbaatar Broadcasting System Warburg. About Actuate Corporation Actuate Corporation is the leading provider of Information Delivery solutions for Global 2000 companies and packaged application software vendors. Actuate provides the most effective platform for retrieving business information from corporate databases and delivering interactive Web pages and Excel spreadsheets to customers, prospects, partners and employees. Its infrastructure software is the foundation for applications such as client reporting, key performance indicators Key Performance Indicators (KPI) are financial and non-financial metrics used to quantify objectives to reflect strategic performance of an organization. KPIs are used in Business Intelligence to assess the present state of the business and to prescribe a course of action. , CRM (Customer Relationship Management) An integrated information system that is used to plan, schedule and control the presales and postsales activities in an organization. and e-Procurement. Actuate content is seamlessly integrated into corporate Web sites and packaged applications and can be printed and used to exchange data with other applications. By instantly delivering personalized per·son·al·ize tr.v. per·son·al·ized, per·son·al·iz·ing, per·son·al·iz·es 1. To take (a general remark or characterization) in a personal manner. 2. To attribute human or personal qualities to; personify. content from tens to millions of end-users -- without downloads -- companies using Actuate can increase revenue, reduce costs and improve customer service. Actuate has over 1,900 direct customers and over 250 OEM (Original Equipment Manufacturer) The rebranding of equipment and selling it. The term initially referred to the company that made the products (the "original" manufacturer), but eventually became widely used to refer to the organization that buys the products and partners, including almost thirty percent of the Fortune 1000. Founded in 1993, Actuate has headquarters in South San Francisco, Calif., and has offices worldwide. For more information on Actuate, visit the company's Web site at www.actuate.com. Conference Call Information Actuate will be holding a conference call at 2 p.m. Pacific Time, today, October 24, 2002 to discuss third quarter results. The dial-in number for the call is 973-528-0008. The conference call will be simultaneously broadcast live on the Investor Relations Investor relations The process by which the corporation communicates with its investors. portion of Actuate's web site at www.actuate.com and will be available as an archived replay at the same location until approximately November 7, 2002. Note to Editors: Actuate is a registered trademark of Actuate Corporation. e.Reporting and e.Spreadsheet are trademarks of Actuate Corporation. All other products and corporate names referenced are trademarks of their respective companies. The statements contained in this release that are not purely historical are forward looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, including statements regarding Actuate's expectations, beliefs, hopes, intentions or strategies regarding the future. All 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. in this release are based upon information available to Actuate 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 Actuate assumes no obligation to update any such forward-looking statements. Actual results could differ materially from Actuate's current expectations. Factors that could cause or contribute to such differences include, but are not limited to, the Risk Factors discussed in Actuate's Securities and Exchange Commission filings, specifically Actuate's 2001 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. filed on March 19, 2002 and Quarterly Report on Form 10-Q Form 10-Q See 10-Q. filed on August 12, 2002.
TABLE A
ACTUATE CORPORATION
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
2002 2001 2002 2001
Revenues:
License fees $ 13,193 $ 17,415 $ 44,063 $ 61,460
Services 12,361 10,786 37,805 34,789
--------- --------- --------- ---------
Total revenues 25,554 28,201 81,868 96,249
--------- --------- --------- ---------
Costs and expenses:
Cost of license fees 411 563 1,471 1,723
Cost of services 5,759 6,278 18,433 21,374
Sales and marketing 10,525 13,703 35,465 45,149
Research and
development 4,328 4,836 14,143 13,935
General and
administrative 2,244 1,947 7,111 6,305
--------- --------- --------- ---------
Total costs and
expenses 23,267 27,327 76,623 88,486
--------- --------- --------- ---------
Income from operations 2,287 874 5,245 7,763
Interest and other
income, net 214 291 576 962
--------- --------- --------- ---------
Income before income
taxes 2,501 1,165 5,821 8,725
Provision for income
taxes (938) (435) (2,183) (2,033)
--------- --------- --------- ---------
Net income $ 1,563 $ 730 $ 3,638 $ 6,692
========= ========= ========= =========
Basic net income
per share $ 0.03 $ 0.01 $ 0.06 $ 0.11
========= ========= ========= =========
Shares used in basic
per share calculation 59,994 60,069 60,293 58,914
========= ========= ========= =========
Diluted net income
per share $ 0.03 $ 0.01 $ 0.06 $ 0.11
========= ========= ========= =========
Shares used in diluted
per share calculation 60,497 62,581 62,535 62,901
========= ========= ========= =========
The above pro forma condensed consolidated statements of operations
information is for illustrative purposes only and is not prepared in
accordance with generally accepted accounting principles as it
excludes the effects of the following (in thousands):
--&#x 1; For the three months ended September 30, 2002, amortization of
other intangibles of $996 and restructuring costs of $26,223.
For the nine months ended September 30, 2002, amortization of
other intangibles of $2,989 and restructuring costs of $26,223
and idle facility expense of $1,760 included in general and
administrative.
--&#x 1;&#x 1;For the three months ended September 30, 2001, amortization of
goodwill and other intangibles of $3,120, restructuring costs
of $362 and idle facility expense of $930 included in general
and administrative. For the nine months ended September 30,
2001, amortization of goodwill and other intangibles of 7,587,
restructuring costs of $859 and idle facility expense of
$1,358 included in general and administrative.
The provision for income taxes in the pro forma condensed consolidated
statements of operations for the three and nine months ended September
30, 2002 was computed using an income tax rate of 37.5%. The provision
for income taxes in the pro forma condensed statements of operation
for the three and nine months ended September 30, 2001 was the actual
tax expense used in the actual statement of operations as reflected in
Table B. The computation of the provision for income taxes in the pro
forma consolidated statements of operations for each period has been
taken into account the effect of the items described in the above
footnotes. The amount of provision for income taxes in the pro forma
condensed consolidated statement of operations does not reflect the
actual or future expected provision for income taxes in Table B.
TABLE B
ACTUATE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
Three Months Ended Nine Months Ended
September 30 September 30
2002 2001 2002 2001
Revenues:
License fees $ 13,193 $ 17,415 $ 44,063 $ 61,460
Services 12,361 10,786 37,805 34,789
--------- --------- --------- ---------
Total revenues 25,554 28,201 81,868 96,249
--------- --------- --------- ---------
Costs and expenses:
Cost of license fees 411 563 1,471 1,723
Cost of services 5,759 6,278 18,433 21,374
Sales and marketing 10,525 13,703 35,465 45,149
Research and
development 4,328 4,836 14,143 13,935
General and
administrative 2,244 2,877 8,871 7,663
Amortization of
goodwill and other
intangibles 996 3,120 2,989 7,587
Restructuring costs 26,223 362 26,223 859
--------- --------- --------- ---------
Total costs and expenses 50,486 31,739 107,595 98,290
--------- --------- --------- ---------
Loss from operations (24,932) (3,538) (25,727) (2,041)
Interest and other
income, net 214 291 576 962
--------- --------- --------- ---------
Loss before income
taxes (24,718) (3,247) (25,151) (1,079)
Provision for income
taxes (1,195) (435) (1,032) (2,033)
--------- --------- --------- ---------
Net loss $(25,913) $ (3,682) $(26,183) $ (3,112)
========= ========= ========= =========
Basic net loss
per share $ (0.43) $ (0.06) $ (0.43) $ (0.05)
========= ========= ========= =========
Shares used in basic
per share calculation 59,994 60,069 60,293 58,914
========= ========= ========= =========
Diluted net loss
per share $ (0.43) $ (0.06) $ (0.43) $ (0.05)
========= ========= ========= =========
Shares used in diluted
per share calculation 59,994 60,069 60,293 58,914
========= ========= ========= =========
TABLE C
ACTUATE CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
September 30, December 31,
2002 2001
(unaudited)
ASSETS
Current assets:
Cash, cash equivalents and short-term
investments $ 42,699 $ 39,807
Accounts receivable, net 22,635 28,870
Other current assets 4,753 4,251
---------- ----------
Total current assets 70,087 72,928
Property and equipment, net 6,985 12,387
Goodwill and other intangibles 27,499 30,488
Other assets 1,526 1,588
---------- ----------
$ 106,097 $ 117,391
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 4,010 $ 3,621
Current portion of long-term liabilities 3,050 0
Accrued compensation and other
accrued liabilities 12,687 17,186
Deferred revenue 21,613 23,978
---------- ----------
Total current liabilities 41,360 44,785
---------- ----------
Long-term liabilities 19,364 1,529
---------- ----------
Stockholders' equity 45,373 71,077
---------- ----------
$ 106,097 $ 117,391
========== ==========
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