Artisoft Announces Financial Results for Third 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)--April 25, 2002 Artisoft, 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 third quarter of fiscal year 2002, ended March 31, 2002. Excluding the effects of a reserve established for channel inventory rotations of $800,000, revenue for the quarter was $1.3 million. Cash usage for the quarter was approximately $1 million and the cash balance remains strong at $7.8 million. Including the rotation reserve, for the third quarter, Artisoft reported net revenue of $500,000 and a net loss of $2.9 million, or $.18 per share. These results compare to net revenue of $2.5 million and a net loss of $1.3 million, or $.11 per share for the second quarter of fiscal year 2002. Included in second quarter revenue was $900,000 of 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 that, 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 the OEM agreement, was not scheduled to repeat in the third quarter. The remaining $2.0 million in guaranteed OEM payments are currently scheduled to occur in Q4 02 and Q2 03. The second quarter also included $350,000 of revenue from 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: hardware sales and inventory rotations that also were not expected to repeat in the third quarter as the company has evolved its strategy to focus on its high-margin TeleVantage software products. 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 $3.2 million in the third quarter compared with $3.4 million in the second quarter. As mentioned above third quarter revenue has been reduced by $800,000 for anticipated future OEM channel inventory rotations associated with the introduction of TeleVantage 5.0 later this calendar year. This $800,000, along with the remaining $2.0 million in guaranteed OEM revenue, will be recognized over future quarters. Additionally, future OEM shipments will be recorded as revenue upon sale by the OEM. "The recognition of OEM revenue using the sell through model will allow us to help avoid swings in our revenue and more clearly portray por·tray tr.v. por·trayed, por·tray·ing, por·trays 1. To depict or represent pictorially; make a picture of. 2. To depict or describe in words. 3. To represent dramatically, as on the stage. how our products are progressing in the marketplace," stated Mike O'Donnell O'Donnell (Irish: Ó Dónaill or Ó Dómhnaill), which is derived from the forname Domhnaill (meaning "world ruler", Rex Mundi in Latin, Modern Irish spelling, Dónall) were an ancient and powerful Irish clan, kings, princes, and lords of Tyrconnel in early times, and , CFO See Chief Financial Officer. of Artisoft. "Artisoft continues to make solid progress in building a leadership position in the emerging open systems PBX (Private Branch eXchange) An inhouse telephone switching system that interconnects telephone extensions to each other as well as to the outside telephone network (PSTN). market," 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. . "This quarter's highlights included strong growth in both our OEM sell-through sell-through Adjective of the sale of prerecorded video cassettes, without their first being for hire only licenses as well as sales of our new 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 product that is being pre-loaded pre-loaded adj (Comput) [program etc] → vorinstalliert on the Intel Converged Communications Platform. Artisoft's ability to partner with industry leaders such as Toshiba and Intel continues to be a key strength of our company." During the third quarter, the company strengthened its relationship with Intel Corp. by announcing a collaborative project between the companies to integrate TeleVantage with Intel's next generation of 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. hardware, which will greatly expand the system's scalability, and shipping a new version of TeleVantage CTM Suite, which is being preloaded on the Intel Converged Communications Platform. TeleVantage CTM Suite is an open, standards-based phone system that delivers robust and flexible functionality for small- to medium-sized businesses and branch offices. Artisoft also unveiled TeleVantage Call Center Scoreboard, an invaluable tool for call center managers who need to closely monitor call center queue Pronounced "Q." A temporary holding place for data. See queuing, message queue and print queue. (programming) queue - A first-in first-out data structure used to sequence objects. Objects are added to the tail of the queue ("enqueued") and taken off the head ("dequeued"). and agent performance through physical display wallboards or visual or audible A protected MP3 file format from the Audible.com audio download service. See Audible.com. statistic-based alarms and notifications. In connection with this new product, Artisoft announced an alliance with Spectrum, an innovative manufacturer of wallboards and other electronic displays, to integrate TeleVantage Call Center with Spectrum's overhead displays. Artisoft will be host a conference call at 4:45 p.m. today (ET) to discuss fiscal 2002 third quarter 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 http://www.artisoft.com/corpcalls.html. A recorded replay of the call will be available beginning at 7:45 p.m. (ET) today until May 24th, 2002. About Artisoft Artisoft, Inc. 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 Expo 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 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. 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 Nine Months Ended
March 31, March 31,
2002 2001 2002 2001
Net revenue:
Product $ 461 $ 1,180 4,358 $ 4,125
Services -- 509 20 1,807
Total net revenue 461 1,689 4,378 5,932
Cost of sales:
Product 115 331 787 1,303
Services -- 464 12 1,355
Total cost of sales 115 795 799 2,658
Gross profit:
Product 346 849 3,571 2,822
Services -- 45 8 453
Total gross profit 346 894 3,579 3,275
Operating expenses:
Sales and marketing 1,398 2,140 4,410 7,297
Product development 763 1,016 2,731 2,800
General and administrative 1,077 1,255 3,457 3,840
Total operating expenses 3,238 4,411 10,598 13,937
Loss from operations (2,892) (3,517) (7,019) (10,662)
Other income, net 34 129 159 454
Net loss (2,858) (3,388) (6,860) (10,208)
Dividend to Series B
preferred stock -- (2,766) --
Loss applicable to common
stock $ (2,858) $ (3,388) (9,626) $ (10,208)
Net loss applicable to common
stock-Basic and Diluted $ (0.18) $ (0.22) (0.61) $ (0.66)
Weighted average common
shares outstanding-Basic
and Diluted 15,782 15,724 15,731 15,488
Artisoft, Inc. and Subsidiaries
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except per share amounts)
March 31, June 30,
2002 2001
(Unaudited)
ASSETS
Current Assets:
Cash and cash equivalents $ 7,828 $ 5,801
Receivables:
Trade accounts, net of
allowances of $171 and $249
at March, 2002 and June 2001,
respectively 597 972
Other receivables 6 27
Inventories 25 674
Prepaid expenses 264 500
Total current assets 8,720 7,974
Property and equipment 3,425 3,331
Less accumulated depreciation and
amortization (2,511) (1,943)
Net property and equipment 914 1,388
Other assets 270 187
$ 9,904 $ 9,549
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 357 $ 682
Accrued liabilities 1,601 1,424
Deferred revenue 251 168
Reserve for Stock Rotation 905 484
Total current liabilities 3,114 2,758
Commitments and contingencies - -
Shareholders' equity:
Preferred stock, $1.00 par value.
Authorized 11,433,600 shares;
issued 2,800,000 Series B shares
at March 31, 2002 2,800 -
Common stock, $.01 par value.
Authorized 50,000,000 shares;
issued 29,102,920 shares at
March 31, 2002 and 29,051,168
at June 30, 2001 291 291
Additional paid-in capital 106,377 102,318
Accumulated deficit (32,894) (26,034)
Less treasury stock, at cost,
13,320,500 shares at March 31,
2002 and June 30, 2001 (69,784) (69,784)
Net shareholders' equity 6,790 6,791
$ 9,904 $ 9,549
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