Avistar Communications Corporation Reports Third Quarter 2001 Results.Business Editors/High Tech Writers REDWOOD redwood: see sequoia; brazilwood. redwood or sequoia Coniferous evergreen timber tree (Sequoia sempervirens) of the family Taxodiaceae, found in the fog belt of west-coastal North America. SHORES, Calif.--(BUSINESS WIRE)--Oct. 11, 2001 -- Will Integrate the Avistar Video Operating System with Syntegra's Trading Communications Platforms -- Five new customers Avistar Avistar Communications Corporation  This article or section is written like an .Please help [ rewrite this article] from a neutral point of view. Communications Corporation (Nasdaq:AVSR (Audio Visual Speech Recognition) Using lip reading software to enhance speech recognition. In noisy environments where a camera can be included, AVSR improves the computer's ability to recognize the speaker's words by visually tracking lip movement and ), the leading provider of enterprise video communication solutions, today announced financial results for its quarter ended September September: see month. 30, 2001. Earlier today, the company also announced a joint marketing and resale resale n. selling again, particularly at retail. In many states a "resale license" or "resale number" is required so that the state can monitor the collection of sales tax on retail sales. RESALE. agreement with Syntegra, the global consulting and systems integration business arm of British Telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. . Revenues for the three months ended September 30, 2001 were $3.0 million, compared to revenues of $5.5 million for the three months ended September 30, 2000, and revenues of $3.5 million for the three months ended June June: see month. 30, 2001. For the three months ended September 30, 2001, gross margins were 53%, compared to 59% for the three months ended September 30, 2000. Avistar reported a net loss of $1.9 million, or a loss of $0.08 per share on 25.2 million weighted average shares outstanding, for the three months ended September 30, 2001. For the three months ended September 30, 2000, the net loss, including a beneficial conversion charge, was $39.0 million, or a 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 net loss of $1.56 per share on 25.1 million pro forma weighted average shares outstanding. A one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. charge of $37.8 million was recorded in the three months ended September 30, 2000 for the beneficial conversion of convertible preferred stock Convertible Preferred Stock Preferred stock that includes an option for the holder to convert the preferred shares into a fixed number of common shares, usually anytime after a predetermined date. Also known as "convertible preferred shares". at the time of Avistar's initial public offering. Excluding the one-time charge for the beneficial conversion, the net loss was $1.2 million for the three months ended September 30, 2001. For the nine months ended September 30, 2001, revenues were $12.7 million, compared to revenues of $14.8 million for the same period ended September 30, 2000. Avistar reported a net loss of $6.2 million, or a loss of $0.25 per share on 25.2 million weighted average shares outstanding, for the nine months ended September 30, 2001. These results compare to a net loss of $41.8 million, or $1.67 per share on 25.0 million pro forma weighted average shares outstanding last year. Excluding the one-time charge for the beneficial conversion related to convertible preferred stock, the net loss was $4.0 million for the nine months ended September 30, 2001. As of September 30, 2001, Avistar had cash and cash equivalents and short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. investments of $15.4 million, and no long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. . "Recognizing our special relationship with the financial services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. sector, we wish to extend our sympathies to the families of the victims of the tragic events of September 11, 2001," said Gerald Gerald - ["Gerald: An Exceptional Lazy Functional Programming Language", A.C. Reeves et al, in Functional Programming, Glasgow 1989, K. Davis et al eds, Springer 1990]. J. Burnett, Avistar's chairman and chief executive officer. "In the third quarter of 2001, we had five new accounts, despite a pervasive pervasive, adj indicates that a condition permeates the entire development of the individual. economic slowdown For articles with similar titles, see Slow Down (disambiguation). A slowdown is an industrial action in which employees perform their duties but seek to reduce productivity or efficiency in their performance of these duties. . Three of those new implementations are global companies in industrial sectors of the economy, while two are in the financial services sector," stated Burnett. "Revenues in the third quarter of 2001 were as anticipated, reflecting the slower summer months," stated Robert Robert, Henry Martyn 1837-1923. American army engineer and parliamentary authority. He designed the defenses for Washington, D.C., during the Civil War and later wrote Robert's Rules of Order (1876). Noun 1. J. Habig, Avistar's chief financial officer. "In the third quarter of 2001, we continued to tightly manage our costs, with total 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. of $3.7 million, reflecting a decline of $1.1 million from the second quarter of 2001. This cost performance helped drive an improvement in our net loss of approximately $900,000 in the third quarter versus the second quarter of this year "Current economic and political uncertainties, offset by increased interest in video collaboration Working together on a project. See collaborative software. , lead us to anticipate that revenues for the fourth quarter of 2001 will be higher than the third quarter of 2001, but well below the fourth quarter of last year," said Habig. "We expect operating expenses for the fourth quarter of 2001 to again reflect cost improvements, and therefore, total operating expenses should decrease from third quarter 2001 levels. We expect the net loss and cash usage for the fourth quarter 2001 to be similar to, but less than, the net loss and cash usage reported for the third quarter of 2001." Avistar will be hosting a conference call at 2:00 p.m. Pacific/5:00 p.m. Eastern, today, Thursday Thursday: see week. October October: see month. 11, 2001 to discuss third quarter 2001 results and review the company's progress and outlook. Interested parties can access this call by going to the Avistar Investor Relations Investor relations The process by which the corporation communicates with its investors. page at www.avistar.com and to the "Conference Calls" button at the bottom of that page. A 24-hour replay will be available for seven days after this call at www.avistar.com or by calling 888-843-8996 and giving the following passcode: 4767954. Avistar Communications Corporation Avistar develops, markets and supports a comprehensive suite of networked video communication services for the enterprise. From the desktop, Avistar delivers TV-quality interactive video calling, content creation and publishing, broadcast origination Origination The process through which a mortgage lender creates a mortgage secured by some amount of the mortgagor's real property. Notes: Also known as loan origination, everyone must go through the origination process when securing a mortgage for a piece of real and distribution, video-on-demand The ability to deliver a movie, sports event or other video program to a TV set whenever the customer requests it. Video-on-demand (VOD) typically refers to free and paid programs from the cable TV companies or the telephone companies that offer video over DSL lines. , and integrated data sharing The ability to share the same data resource with multiple applications or users. It implies that the data are stored in one or more servers in the network and that there is some software locking mechanism that prevents the same set of data from being changed by two people at the same time. . The Avistar video and data collaboration See data conferencing. applications are all managed by Avistar's VOS An operating system used in Stratus computers. FTX is Stratus' Unix operating system. (TM) video operating system operating system (OS) Software that controls the operation of a computer, directs the input and output of data, keeps track of files, and controls the processing of computer programs. . Founded in 1993, Avistar Communications Corporation (Nasdaq:AVSR) is headquartered in Redwood Shores, California Redwood Shores is an upscale and desirable [1] waterfront neighborhood on the San Francisco Peninsula in California. It is located on the eastern edge of Belmont, but is actually part of incorporated Redwood City. , with sales offices in New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of and London London, city, Canada London, city (1991 pop. 303,165), SE Ont., Canada, on the Thames River. The site was chosen in 1792 by Governor Simcoe to be the capital of Upper Canada, but York was made capital instead. London was settled in 1826. . Collaboration Properties, Inc Collaboration Properties, Inc. (CPI) is a wholly owned subsidiary of Avistar Communications Corporation. It holds US and foreign patents in the primary areas of presence-based interactions, desktop video, recorded and live media at the desktop, multimedia documents, data sharing, ., a wholly owned subsidiary Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. of Avistar Communications Corporation, holds a broad portfolio of patents covering Avistar's VOS open platform as well as multiple software and hardware video collaboration products See collaborative software. . For more information on Avistar, visit www.avistar.com. Forward Looking Statements Statements made in this news release regarding Avistar's financial outlook for the 2001 fiscal year, in particular the economic environment and its resulting impact on capital spending capital spending Spending for long-term assets such as factories, equipment, machinery, and buildings that permits the production of more goods and services in future years. budgets, the impact of the events of September 11, 2001, customer spending patterns and Avistar revenues, gross margins, and operating expenditures, as well as statements regarding "strategies," "intentions," "expectations," "beliefs," "goals," or the like, are 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. within the meaning of Section 21E of the Securities Exchange Act. Such statements are subject to risks and uncertainties that could cause actual results to differ materially, including such factors, among others, as the impact of economic weakness and purchasing patterns in the financial services industries, the impact of the September 11, 2001 events on capital spending, particularly by financial services companies, the impact of competitive products and pricing, the timely development and market acceptance of new products, the ability to raise capital, the mix between domestic and international sales, manufacturing and cost of Avistar's products, dependence on partners, the enforceability of intellectual property rights, the ability to achieve sales and revenue objectives, the ability to manage expenses, the ability to enter into new distribution agreements, uncertainties relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc sole source suppliers, fluctuations in the stock market, alternative technological approaches and adoption of alternative technological standards. As a result of these and other factors, Avistar expects to experience significant fluctuations in operating results, and there can be no assurance that Avistar will become or remain consistently profitable in the future, or that its future results will meet expectations. These and other risk factors are discussed in Avistar's "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" set forth in Avistar's 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 year ended December December: see month. 31, 2000 filed on March 9, 2001 and on Form 10-Q Form 10-Q See 10-Q. for the quarter ended June 30, 2001 filed on August 7, 2001 with the Securities and Exchange Commission. Avistar disclaims any intent or obligation to update these forward-looking statements. Note to Editors: Avistar, VOS, and the Avistar logo are trademarks or registered trademarks of Avistar Communications Corporation. All other names used are the trademarks of their respective owners.
AVISTAR COMMUNICATIONS CORPORATION AND SUBSIDIARIES
CONDENSED COMBINED STATEMENT OF OPERATIONS
for the three and nine months ended September 30, 2000 and
Consolidated Statement of Operations for the three and nine months
ended September 30, 2001
(in thousands, except per share data)
Three Months Ended Nine Months Ended
September September September September
30, 2000 30, 2001 30, 2000 30, 2001
-------- -------- -------- --------
(unaudited) (unaudited)
Revenues:
Products $ 4,492 $ 1,719 $ 11,573 $ 8,854
Services, maintenance
and support 1,040 1,310 3,210 3,800
-------- -------- -------- --------
Total revenue 5,532 3,029 14,783 12,654
Cost of revenue:
Products 1,816 857 5,088 3,745
Services, maintenance
and support 466 578 1,520 2,113
-------- -------- -------- --------
Total cost of revenue 2,282 1,435 6,608 5,858
Gross margin 3,250 1,594 8,175 6,796
Operating Expenses:
Research and
development 1,129 1,146 2,920 4,073
Sales and marketing 1,660 1,278 4,009 4,791
General and
administrative 1,154 1,105 2,933 4,069
Amortization of
deferred stock
compensation(1) 447 155 1,615 706
-------- -------- -------- --------
Total operating
expenses 4,390 3,684 11,477 13,639
Loss from operations (1,140) (2,090) (3,302) (6,843)
Other income (expenses)
Interest expense (247) -- (977) (2)
Interest income 192 157 311 643
Other, net (5) (4) (10) 23
-------- -------- -------- --------
Total other income
(expense), net (60) 153 (676) 664
Net loss $ (1,200) $ (1,937) $ (3,978) $ (6,179)
======== ======== ======== ========
Beneficial conversion
related to convertible
preferred stock $(37,783) $ -- $(37,783) $ --
-------- -------- -------- --------
Net loss attributable
to common
stockholders $(38,983) $ (1,937) $(41,761) $ (6,179)
======== ======== ======== ========
Net loss per share -
basic and diluted $ (3.21) $ (0.08) $ (9.95) $ (0.25)
======== ======== ======== ========
Weighted Average
shares used in
calculating basic
and diluted net loss
per share 12,136 25,181 4,195 25,159
======== ======== ======== ========
Pro forma net loss
per share -
basic & diluted $ (1.56) $ (1.67)
======== ========
Pro forma weighted
average shares used
in calculating
basic and diluted
net loss per share 25,067 25,012
======== ========
(1) Amortization of
deferred stock
compensation
excluded from the
following expenses:
Cost of Revenue $ 49 $ 18 $ 214 $ 98
Research and
development 39 14 184 83
Sales and Marketing 350 120 1,178 508
General and
administrative 9 3 39 17
-------- -------- -------- --------
$ 447 $ 155 $ 1,615 $ 706
======== ======== ======== ========
AVISTAR COMMUNICATIONS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
as of December 31, 2000 and September 30, 2001
(in thousands, except share and per share data)
December 31, September 30,
2000 2001
----------- ------------
Assets: (unaudited)
Current assets:
Cash and cash equivalents $ 21,660 $ 10,176
Short-term investments -- 5,225
Accounts receivable, net of
allowance for doubtful accounts
of $312 and $252, respectively 3,712 2,974
Inventories, including inventory
shipped to customers sites, not
yet installed of $854 and $231,
respectively 2,156 1,644
Prepaid expenses and other
current assets 434 402
-------- --------
Total current assets 27,962 20,421
Property and equipment, net 83 460
Other assets 258 431
-------- --------
Total assets $ 28,303 $ 21,312
======== ========
Liabilities and Stockholders' Equity:
Current liabilities:
Accounts payable $ 2,006 $ 1,104
Deferred revenue and deposits 2,126 1,691
Accrued liabilities and other 2,407 2,007
-------- --------
Total current liabilities 6,539 4,802
-------- --------
Stockholders' equity:
Common stock, $0.001 par value;
250,000,000 and 250,000,000
shares authorized at December
31, 2000 and September 30, 2001,
respectively, 26,266,990 and
26,362,603 shares issued at
December 31, 2000 and September
30, 2001 respectively 26 26
Treasury common stock,
1,143,625 and 1,166,125 shares at
December 31, 2000 and September
30, 2001 respectively (1) (1)
Additional paid-in-capital 80,145 80,000
Deferred stock compensation (1,755) (685)
Accumulated deficit (56,651) (62,830)
-------- --------
Total stockholders' equity 21,764 16,510
-------- --------
Total liabilities and
stockholders' equity $ 28,303 $ 21,312
======== ========
AVISTAR COMMUNICATIONS CORPORATION AND SUBSIDIARIES
CONDENSED COMBINED STATEMENT OF CASH FLOWS
for the nine months ended September 30, 2000 and
Consolidated Statement of Cash Flows for the nine months ended
September 30, 2001
(in thousands)
Nine Months Ended
September September
30, 2000 30, 2001
-------- --------
(unaudited)
Cash Flows from Operating Activities:
Net loss $ (3,978) $ (6,179)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation 110 130
Stock compensation expense, net 1,615 706
Provision for doubtful accounts (11) 50
Changes in current assets and liabilities:
Accounts receivable (558) 688
Inventories (984) 512
Prepaid expenses and other current assets (429) 32
Other assets 60 (173)
Accounts payable 348 (902)
Deferred revenue and deposits 1,319 (435)
Accrued liabilities and other 639 (400)
-------- --------
Net cash used in operating activities (1,869) (5,971)
-------- --------
Cash Flows from Investing Activities:
Purchase of short-term investments -- (5,225)
Purchase of property and equipment -- (507)
-------- --------
Net cash used in investing activities -- (5,732)
-------- --------
Cash Flows from Financing Activities:
Net borrowings under line of
credit 817 --
Payments on notes payable to related parties (12,623) --
Borrowings from related parties 900 --
Proceeds from issuance of common stock 31,410 253
Repurchases of common stock -- (34)
-------- --------
Net cash provided by financing activities 20,504 219
-------- --------
Net decrease in cash and cash equivalents 18,635 (11,484)
Cash and cash equivalents, beginning of
period 6,232 21,660
-------- --------
Cash and cash equivalents, end of period $ 24,867 $ 10,176
======== ========
Supplemental Cash Flow Information:
Cash paid for income taxes $ 5 $ --
Cash paid for interest $ 1,201 $ --
Beneficial conversion related to
convertible preferred stock $ 37,783 $ --
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