Artisoft, Inc. Releases Results for First Quarter of Fiscal Year 2002.Business/Technology Editors 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. , Mass.--(BUSINESS WIRE)--Oct. 25, 2001 Artisoft(R) 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 : ASFT ASFT Airport Surface Friction Tester ), developer of the first software-based phone system, today reported its financial results for the first quarter of fiscal year 2002, ended September September: see month. 30, 2001. Excluding the effects of reserves, channel inventory rotations and 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 revenue schedules, the company reported sequential revenue growth of 9% over the previous quarter. For the first quarter, Artisoft reported net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight of $1.4 million and a net loss of $2.7 million. These results compare to net sales of $1.5 million and a net loss of $2.5 million or $.16 per share for the fourth quarter of fiscal year 2001. Gross margins for the first quarter of fiscal year 2002 were 84% compared with 61% in the fourth quarter of fiscal year 2001. 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. were $4.0 million in the first fiscal quarter compared with $3.6 million in the fourth fiscal quarter of fiscal year 2001. The first quarter expenses include $350,000 in employee severence costs. Reflected in the company's financial statements were several non-routine transactions. First quarter revenues include $260,000 in restocking orders associated with a channel inventory rotation resulting from the company's introduction of TeleVantage(R) Release 4.0, and fourth quarter revenues include a reduction in sales of approximately $500,000 to reserve for channel inventory rotation and an increase of $400,000 due to the reversal of a previously established returns reserve relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the company's 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: product line. Additionally, based on contractual schedules, the first quarter was impacted by a reduction in OEM TeleVantage sales of approximately $400,000 from the previous quarter; the company expects to realize growth of approximately $800,000 in OEM TeleVantage sales in the second quarter. In the first quarter the company recorded a non-cash dividend of $2.4 million relating to the value of the warrants and the beneficial conversion feature on the Series B Preferred Stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. issued in connection with the financing announced in August 2001. The applicable loss per common share in the first quarter of fiscal year 2002, including the non-cash dividend, was $.32. Excluding the non-cash dividend, the loss per common share was $.17 in the first quarter. The comparable loss per common share in the fourth quarter of fiscal year 2001 was $.16. During the first quarter, the company strengthened its position in the open systems communications market by shipping two new major product releases. TeleVantage 4.0, which began shipping in September, includes the introduction of the TeleVantage Call Center, an add-on A purchase of additional goods before payment is made for goods already purchased. An add-on may be covered by a clause in an installment payment contract that allows the seller to hold a security interest in the earlier goods until full payment is made on the later goods. module for managing and optimizing call center performance. TeleVantage 4.0 will also soon be rebranded and distributed by Toshiba Toshiba Corporation (株式会社東芝 Kabushiki-gaisha Tōshiba . TeleVantage CTM CTM Continuum (gaming) CTM Community Trade Mark (Europe) CTM Cisco Transport Manager CTM Confederacion de Trabajadores de Mexico (Spanish: Confederation of Mexican Workers) Suite, which is being pre-bundled on the Intel(R) Converged Communications Platform, is a modular set of open-architecture software that bundles soft switch, auto attendant The part of an interactive voice response (IVR) system that replaces the human operator and directs callers to the appropriate extensions or voice mailboxes. See IVR. , voice-mail applications, and fully integrated Voice-over-IP capabilities. Limited quantities of TeleVantage CTM Suite began shipping in late August. TeleVantage also continued to be recognized as the "best of class" software-based phone system, winning two more awards for technical excellence and attracting a number of new partnerships. TeleVantage received a "Best of Show" award at the Customer Inter@ction Solutions Conference & Expo and the CompTIA Convergence Award by the Computing Technology Industry Association See CompTIA. , bringing its total to 29 industry awards. Artisoft also expanded its Open Communications Alliance to over 20 best-of-breed The best product of its type. Organizations often purchase software from different vendors in order to obtain the best-of-breed for each application area; for example, a human resources package from one vendor and an accounting package from another. technology partners. Recent additions include Oncontact Software, a developer of CRM (Customer Relationship Management) An integrated information system that is used to plan, schedule and control the presales and postsales activities in an organization. systems for the mid market; SBS Technologies SBS Technologies, Inc., (Nasdaq: SBSE) founded in 1986, designed and built open architecture embedded computer products that enable original equipment manufacturers to serve the commercial, communication and government markets. SBS was headquartered in Albuquerque, New Mexico. , a manufacturer of computer components; Digisoft Computers, a developer of a leading PC-based call center and CRM software; and Sitara Networks, a provider of integrated Quality of Service solutions. "With the recent introduction of TeleVantage 4.0 and TeleVantage CTM Suite, Artisoft now has three exciting new growth opportunities," said Steve Manson Man·son , Sir Patrick 1844-1922. Scottish parasitologist. One of the founders (1899) of the London School of Tropical Medicine, he introduced (1877) the hypothesis that the mosquito is host to the malaria parasite. , 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. of Artisoft. "TeleVantage 4.0 provides our reseller An organization that sells hardware and software to the general public. Resellers purchase products from software publishers and hardware manufacturers. channel with a compelling solution for mid-size call center customers, TeleVantage CTM Suite is a first-to-market product that enables us to leverage the powerful marketing and distribution resources of Intel; and the Toshiba OEM version of TeleVantage 4.0 will allow us to leverage the channel of one of the strongest telephony Meaning "sound over distance," it refers to electronically transmitting the human voice. In the beginning, telephony dealt only with analog signals in the circuit-switched networks of the telephone companies. suppliers in the industry." Artisoft will be holding a conference call at 4:45 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 to discuss the first quarter fiscal year 2002 results. A live Webcast will be available at www.artisoft.com. About Artisoft Artisoft, Inc. (NASDAQ: ASFT) of Cambridge, Mass., is a leading developer of open, software-based telephone systems that bring together voice and data for more powerful and productive communications. Designed specifically for small to midsize businesses, corporate branch offices, and call centers, Artisoft's TeleVantage delivers greater functionality, flexibility and value than proprietary PBXs. Artisoft's innovative software products have received more than 30 industry awards including "Product of the Year," "Best of Show," and "Editors' Choice" by Network Magazine, Communications Solutions Magazine and Customer Inter@action Solutions Magazine. The company distributes its products and services worldwide through a dedicated and growing channel of authorized au·thor·ize tr.v. au·thor·ized, au·thor·iz·ing, au·thor·iz·es 1. To grant authority or power to. 2. To give permission for; sanction: resellers. For more information, please call 800-914-9985 or visit our website, http://www.artisoft.com. Artisoft and TeleVantage are registered trademarks of Artisoft, Inc. All other company and product names mentioned may be trademarks or registered trademarks of the respective companies with which they are associated. 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. : This release contains forward-looking statements based on current expectations or beliefs, as well as a number of assumptions about future events, and these statements are subject to important facts and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. The forward-looking statements in this release address a variety of subjects including, for example, Artisoft's financial results, management's strategies and Artisoft's products and strategic alliances. The following factors, among others, could cause actual results to differ materially from those described in these forward- looking statements: the approval of the Company's shareholders of the financing announced on August 8, 2001, the availability of additional financing on terms acceptable to the Company or at all, the impact of competitive products and pricing, product demand and market acceptance risks, the presence of competitors with greater financial resources, product development and commercialization risks, costs associated with integration and administration of acquired operations, capacity and supply constraints CONSTRAINTS - A language for solving constraints using value inference. ["CONSTRAINTS: A Language for Expressing Almost-Hierarchical Descriptions", G.J. Sussman et al, Artif Intell 14(1):1-39 (Aug 1980)]. or difficulties and other factors detailed in the Company's filings with the Securities and Exchange Commission including its recent filings on Forms 10-K.
Artisoft, Inc. and Subsidiaries
CONSOLIDATED BALANCE SHEETS
(in thousands, except per share amounts)
September 30, June 30,
2001 2001
ASSETS
Current Assets:
Cash and cash equivalents $ 7,606 $ 5,801
Receivables:
Trade accounts, net 229 488
Other receivables 8 27
Inventories 495 674
Prepaid expenses 242 500
Total current assets 8,580 7,490
Property and equipment 3,330 3,331
Less accumulated depreciation
and amortization (2,144) (1,943)
Net property and equipment 1,186 1,388
Other assets 241 187
$ 10,007 $ 9,065
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 265 $ 682
Accrued liabilities 1,768 1,424
Deferred revenue 194 168
Total current liabilities 2,227 2,274
Commitments and contingencies -- --
Shareholders' equity:
Preferred stock, $1.00 par value
Authorized 11,433,600 shares; issued
1,560,000 Series B shares at
September 30, 2001 1,560 --
Common stock, $.01 par value. Authorized
50,000,000 shares; issued 29,058,168
shares at September 30, 2001
and 29,051,168 at June 30, 2001 291 291
Additional paid-in capital 104,459 102,318
Accumulated deficit (28,746) (26,034)
Less treasury stock, at cost, 13,320,500
shares at September 30, 2001 and
June 30, 2001 (69,784) (69,784)
Net shareholders' equity 7,780 6,791
$ 10,007 $ 9,065
Artisoft, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share amounts)
(Unaudited)
Three Months Ended
September 30,
2001 2000
Net revenue:
Product $ 1,398 $ 1,659
Services 20 562
Total net revenue 1,418 2,221
Cost of sales:
Product 221 499
Services 12 426
Total cost of sales 233 925
Gross profit:
Product 1,177 1,160
Services 8 136
Total gross profit 1,185 1,296
Operating expenses:
Sales and marketing 1,570 2,433
Product development 1,141 836
General and administrative 1,244 1,264
Total operating expenses 3,955 4,533
Loss from operations (2,770) (3,237)
Other income, net 58 189
Net loss (2,712) (3,048)
Dividend to Series B preferred stock (2,379) --
Loss applicable to common stock $ (5,091) $ (3,048)
Net loss applicable to common
stock-Basic and Diluted $ (0.32) $ (0.20)
Weighted average common shares
outstanding-Basic and Diluted 15,731 15,591
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