Artisoft Announces Financial Results for Second Quarter of Fiscal 2004; Revenue Up 27% From Q2 2003; TeleVantage End User Sales up 41% From Q2 2003.Business 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)--Jan. 29, 2004 Artisoft(R), Inc. (OTC OTC See: Over-the-counter. OTC See over-the-counter market (OTC). : ASFT ASFT Airport Surface Friction Tester ), developer of the first software-based phone system, today reported revenue of $2.0 million and a net loss of $1.0 million, or $0.27 per share, for the second quarter of fiscal 2004, which ended December December: see month. 31, 2003. For the second quarter of fiscal 2003, revenue was $1.6 million and net loss was $1.2 million, or $0.41 per share. This increase in revenue sets another record high in overall TeleVantage(R) sales in a quarter and marks growth of 41% in end user sales compared to the second quarter of fiscal 2003. Overall revenue growth was 27% compared to the second quarter of fiscal 2003. Reported revenue for both the second quarter of fiscal 2003 and second quarter of fiscal 2004 include a non-cash reduction of approximately $50,000 for the amortized cost of equity relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc Toshiba's investment in Artisoft in a prior period. 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. for the second quarter of fiscal 2004 were $2.9 million, up slightly from $2.7 million during second quarter of fiscal 2003. Gross margins during the second quarter of fiscal 2004 improved slightly to 98% from 96% in second quarter of fiscal 2003. "We are pleased by the progress Artisoft is making in establishing TeleVantage as the leader in open systems communications," said Steve v. t. 1. To pack or stow, as cargo in a ship's hold. See Steeve. 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. , Artisoft's 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. . "We believe that our strong revenue growth is another indicator that that the shift away from proprietary hardware-based PBXs and IP-PBXs to software-based systems is accelerating, putting Artisoft in a tremendous position. We continue to expand our channel, partnerships and customer base, and look forward to maintaining our momentum in the foreseeable fore·see tr.v. fore·saw , fore·seen , fore·see·ing, fore·sees To see or know beforehand: foresaw the rapid increase in unemployment. future." During the second quarter, Artisoft announced the addition of two new international distributors to extend the global expansion of TeleVantage. Attrix Technology will distribute TeleVantage in countries located within the Asia Pacific region and Westan Communications will distribute TeleVantage in Australia Australia (ôstrāl`yə), smallest continent, between the Indian and Pacific oceans. With the island state of Tasmania to the south, the continent makes up the Commonwealth of Australia, a federal parliamentary state (2005 est. pop. . Growing demand for TeleVantage also drove further expansion of the Open Communications Alliance Program, a coalition of 41 leading technology vendors who are collaborating with Artisoft to develop standards-based solutions with TeleVantage as the focal point focal point n. See focus. . During the second quarter, the company announced that relationships had been forged forge 1 n. 1. A furnace or hearth where metals are heated or wrought; a smithy. 2. A workshop where pig iron is transformed into wrought iron. v. with Intellitouch, Cynergy Software and CDR-Data to develop 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. solutions that combine on-hold audio, 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 call accounting capabilities with TeleVantage. During the quarter, Artisoft also launched the Telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. Consultant Program, which provides qualified consultants with valuable information about the benefits of open systems communications to assist them as they make telecommunications recommendations to their clients. TeleVantage continued to receive accolades as the "best of class" IP-PBX, winning its 35th award for technical excellence. TeleVantage was honored hon·or n. 1. High respect, as that shown for special merit; esteem: the honor shown to a Nobel laureate. 2. a. Good name; reputation. b. with a Best of Show award at Technology Marketing Corporation's Internet Telephony Another term for IP telephony and VoIP. In the late 1990s, some people made a distinction between Internet Telephony and VoIP: Internet telephony referred to voice over the public Internet, while VoIP referred to voice over private IP networks. Conference & Expo, the leading event focused on VoIP and other IP telephony-based solutions. Artisoft will hold a conference call at 5:00 p.m. ET today to discuss the second quarter fiscal year 2004 financial results. The conference call will be broadcast live via the 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 at the Investor Relations Investor relations The process by which the corporation communicates with its investors. section of Artisoft's website, http://www.artisoft.com/corpcalls.html. A recorded replay of the conference call will be available 24 hours per day beginning on Thursday Thursday: see week. , January January: see month. 29, 2004 at 8:00 p.m. ET until February February: see month. 12, 2004 at the Investor Relations section of Artisoft's website, http://www.artisoft.com/corpcalls.html. About Artisoft Artisoft Inc. is a leading developer of open, standards-based telephone systems that bring together voice and data for more powerful and productive communications. Artisoft's TeleVantage delivers greater functionality, flexibility, and value than proprietary PBXs to a variety of customers, from small offices to large enterprise organizations with sophisticated call centers. The company's innovative products have consistently garnered industry recognition for technical excellence, winning more than 35 awards. 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 at 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, without limitation, the industry's shift to software-based systems, the Company's ability to continue to expand its channel, partnerships and customer base and our expectations as to improving demand for our TeleVantage products. The following factors, among others, could cause actual results to differ materially from those described in these forward- looking statements: the availability of additional financing on terms acceptable to the Company or at all, risks associated with the Company's strategic alliances, 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 most recent filings 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. and Form 10-Q Form 10-Q See 10-Q. . Tabular tab·u·lar adj. 1. Having a plane surface; flat. 2. Organized as a table or list. 3. Calculated by means of a table. tabular resembling a table. information follows:
Artisoft, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share amounts)
(Unaudited)
Three Months Ended Six Months Ended
December 31, December 31,
2003 2002 2003 2002
---------- ------- --------- -------
Net revenue:
Product $ 1,970 $ 1,556 3,937 $ 2,999
Services - - - -
---------- ------- --------- -------
Total net revenue 1,970 1,556 3,937 2,999
Cost of sales:
Product 47 54 105 90
Services - - - -
---------- ------- --------- -------
Total cost of sales 47 54 105 90
Gross profit:
Product 1,923 1,502 3,832 2,909
Services - - - -
---------- ------- --------- -------
Total gross profit 1,923 1,502 3,832 2,909
Operating expenses:
Sales and marketing 1,314 1,143 2,663 2,535
Product development 800 650 1,581 1,450
General and administrative 803 933 1,577 2,586
---------- ------- --------- -------
Total operating expenses 2,917 2,726 5,821 6,571
---------- ------- --------- -------
Loss from operations (994) (1,224) (1,989) (3,662)
Other income, net 4 19 9 41
---------- ------- --------- -------
Net loss (990) (1,205) (1,980) (3,621)
---------- ------- --------- -------
Deemed dividend to Series C
preferred shareholders - (2,009)
Deemed dividend to Series B
preferred shareholders - - (1,088) (2,006)
Loss applicable to common
shareholders $ (990)$(1,205) (5,077)$(5,627)
========== ======= ========= =======
Net loss applicable to common
stock-Basic and Diluted $ (0.27)$ (0.41) (1.49)$ (2.00)
========== ======= ========= =======
Weighted average common shares
outstanding-Basic and Diluted 3,692 2,959 3,416 2,807
========== ======= ========= =======
Artisoft, Inc. and Subsidiaries
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except per share amounts)
December 31, June 30,
2003 2003
--------- --------
Unaudited
ASSETS
Current Assets:
Cash and cash equivalents $ 4,198 $ 3,041
Receivables:
Trade accounts, net of allowances of $189
and $182 at December, 2003 and June 2003,
respectively 962 838
Other receivables 2 -
Inventories 122 18
Prepaid expenses 175 368
--------- --------
Total current assets 5,459 4,265
--------- --------
Property and equipment 3,844 3,756
Less accumulated depreciation and amortization (3,483) (3,296)
--------- --------
Net property and equipment 361 460
--------- --------
Other assets 204 269
--------- --------
$ 6,024 $ 4,994
========= ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 250 $ 396
Accrued liabilities 1,291 2,149
Deferred revenue 2,750 2,768
Customer Deposits 229 -
--------- --------
Total current liabilities 4,520 5,313
--------- --------
Commitments and contingencies - -
Shareholders' equity:
Preferred stock, $1.00 par value. Authorized 11,433,600
shares;
Series A Preferred Stock, $1.00 par value. Authorized
50,000
Series A shares; no Series A shares issued at
December 31, 2003 - -
Series B Preferred Stock, $1.00 par value.
Authorized 2,800,000
Series B shares; issued 2,800,000 Series B
shares at
December 31, 2003 (Aggregate liquidation
value $7 million) 2,800 2,800
Series C Preferred Stock, $1.00 par value.
Authorized 2,627,002 2,560
Series C shares; issued 2,627,002 Series C
shares at
December 31, 2003
Common stock, $.01 par value. Authorized 50,000,000
shares;
issued 6,040,135 shares at December 31, 2003
and 5,206,243 at June 30, 2003 60 52
Additional paid-in capital 109,591 108,505
Accumulated deficit (42,706) (40,726)
Deferred Toshiba equity cost (1,121) (1,270)
Less treasury stock, at cost, 2,216,783 shares
at December 31, 2003 and at June 30, 2003 (69,680) (69,680)
--------- --------
Net shareholders' equity 1,504 (319)
--------- --------
$ 6,024 $ 4,994
========= ========
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