Base Ten Releases 1998 Results.TRENTON Trenton, town, Canada Trenton, town (1991 pop. 16,908), SE Ont., Canada, on the Bay of Quinte at the mouth of the Trent River and at the south end of the Trent Canal. Its manufactures include textiles, electronic components, and paper and steel products. , N.J.--(BW HealthWire)--March 9, 1999--Base Ten Systems, Inc. (Nasdaq:BASEA BASEA Boston Area Solar Energy Association ) released results today for the year ended December December: see month. 31, 1998. Revenue for the year totaled $7.6 million, approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. three times revenue for the comparable 1997 fiscal year ended October October: see month. 31, 1997. The net loss for 1998 totaled $19.7 million or $2.02 per share compared to a net loss from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the of $16.0 million or $2.03 per share in the 1997 comparable period. The net loss for the fourth quarter of 1998 totaled $7.2 million or $0.52 per share. Due to the change in the fiscal year-end Fiscal Year-End The completion of a one-year, or 12-month, accounting period. Notes: The reason that a company's fiscal year often differs from the calendar year and does not close on Dec 31, is due to the nature of company's needs. from October to December, there is no comparative period for the fourth quarter of 1998. Revenues for the year were derived de·rive v. de·rived, de·riv·ing, de·rives v.tr. 1. To obtain or receive from a source. 2. 36% from software licenses In computing, software that is copyrighted and licensed under a software license is done under a variety of licensing schemes. For end-users there are proprietary licenses and there are free software licenses, and there are proprietary Within these schemes are further classifications. and enhancements, and 64% from solution services and maintenance contracts. Revenues for the fourth quarter were derived 16% from software licenses and enhancements, and 84% from solution services and maintenance contracts. Several software license orders originally anticipated to be recognized during the fourth quarter of 1998 are now anticipated for recognition in 1999.(a) All categories of expenses were impacted by increases in payroll payroll a list of employees, their salary rates, tax deductions, amounts paid, payroll tax, long service leave entitlements. and related expenses as well as the integration costs related to the acquisition of the Flowstream product in the first quarter of 1998. In addition, product development costs were impacted in the second half of 1998 as development time shifted from supporting current releases to developing future versions of BASE10(tm)ME. General and administrative expenses were also affected by increased professional fees largely related to the 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). of the Company's Series A 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". that occurred during the second half of 1998. The operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. for the year ended December 31, 1998 increased approximately 23% over the operating loss from continuing operations for the comparable period one year ago. The increase is attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to a $3.1 million increase in cost of revenues, $0.8 million increase in amortization of software development costs, $1.8 million increase in product development costs, $2.3 million increase in sales and marketing and $1.3 million increase in general and administrative expenses. Expenses in 1998 totaled $26.3 million, with $5.2 million or 20% being non-cash items including amortization of capitalized Capitalized Recorded in asset accounts and then depreciated or amortized, as is appropriate for expenditures for items with useful lives longer than one year. software development costs and other intangible assets Intangible Asset An asset that is not physical in nature. Notes: Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. , depreciation, and stock-denominated interest payments. Expenses in the fourth quarter of 1998 totaled $8.7 million, with $1.6 million or 18% being non-cash items including amortization of capitalized software development costs and other intangible assets, and depreciation. One year ago, Base Ten management and staff set out to create a commercial software company anchored in a four year old development project. Progress in a number of areas was key to this effort: (1) financial restructuring; (2) product development; (3) sales and marketing; and (4) enhanced customer satisfaction. Considerable progress was made against all four of these key areas during 1998, beginning with moves to adjust the terms of the convertible preferred stock, substantially eliminate 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. , and raise additional capital. Noteworthy progress was also made during the year in the area of product development. Release of version 2.3 of BASE10(tm)ME represented the first shipment of "standard" product for Base Ten. In addition, it is currently anticipated that during the first half of 1999 the Company will release version 3.2 of BASE10(tm)ME. This release will feature enhanced functionality in a number of areas and will be a step up to 32 bit from 16 bit architecture. At least two more 3.X series releases are anticipated in 1999 or early 2000 that will add more features and greater operating speed The operating speed of a road is the speed at which motor vehicles generally operate on that road. The precise definition of "operating speed", however, is open to debate. .(a) While the revenue results suggest an encouraging trend, management is still not satisfied with these results and what they suggest in terms of progress against the sales and marketing objectives. To improve this key area, the Company has identified a new head of global account development who is anticipated to join the Company in April 1999. Customer satisfaction has improved in 1998, although the Company still has much to accomplish in this area as well. The planned 1999 product releases are expected to move us closer to our goal in this area.(a) With 1998, a year of investment and learning, behind us, Base Ten begins 1999 with management's continued optimism Optimism See also Hope. Bontemps, Roger personification of cheery contentment. [Fr. Lit.: “Roger Bontemps” in Walsh Modern, 66] Candide beset by inconceivable misfortunes, hero indifferently shrugs them off. [Fr. for the long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. prospects of the business. Thomas (language) Thomas - A language compatible with the language Dylan(TM). Thomas is NOT Dylan(TM). The first public release of a translator to Scheme by Matt Birkholz, Jim Miller, and Ron Weiss, written at Digital Equipment Corporation's Cambridge Research Laboratory runs E. Gardner Gardner, city (1990 pop. 20,125), Worcester co., N central Mass.; settled 1764, inc. as a city 1921. Its furniture and lumber industries date from c.1805. Diversified metal and electronics manufactures add to the city's economic base. A state prison is there. , chairman and chief executive officer of Base Ten Systems, summarized prospects for the future in this way, "If we continue to make the kind of progress that we have been making on software development issues, with the customer base that Base Ten has and the concepts built into ME/CS we are well positioned to be the dominant player in the MES (Manufacturing Execution Software) Software that provides real time access to plant activities that include equipment, labor, orders and inventory. An MES integrates the data with enterprise resource planning (ERP) systems so that management has complete control of market place when it finally arrives. This is the year, I believe, when that corner will be turned and I am very encouraged by what our customers are telling us."(a) Base Ten Systems is a leading software technology company, focused on execution systems and services for the pharmaceutical, fine chemicals and medical products industries. Through installation of BASE10(tm) software, the company's customers around the world can enjoy more effective regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. compliance, improved manufacturing flexibility and reduced production cycle time. BASE10(tm) execution systems are readily integrated with complementary software partners as manufacturers consolidate Consolidate To combine the assets, liabilities, and other financial items of two or more entities into one. Notes: This term is generally used in the context of consolidated financial statements. their operations into global supply chain processes. You can learn more about Base Ten Systems by visiting its web site at www.base10.com. (a)Forward Looking Statements The foregoing contains "forward looking information" within the meaning of The Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. Such forward looking statements may be identified by a letter 'a' in parenthesis parenthesis: see punctuation. The left parenthesis "(" and right parenthesis ")" are used to delineate one expression from another. For example, in the query list for size="34" and (color = "red" or color ="green") ("a") or by such forward looking terminology The terminology used in the computer and telecommunications field adds tremendous confusion not only for the lay person, but for the technicians themselves. What many do not realize is that terms are made up by anybody and everybody in a nonchalant, casual manner without any regard or as "may", "will", "believe", "anticipate", "expect", or similar words or variations thereof. Such forward looking statements involve certain significant risks and uncertainties. Important factors that the Company believes may cause actual results to differ materially from such forward looking statements are discussed in the "Risk Factors," "Business" and "MD&A" sections of the Company's current S-3 registration statements and annual and quarterly reports on file with the Securities and Exchange Commission. Additional risk factors include the effectiveness of the new software and ability of the new software to operate without "bugs" in the technology and acceptance of the release by customers and actual rollout as a result of the release. In assessing such forward looking statements you are urged to read carefully those reports and other filings. The Company does not undertake to publicly update or revise its forward looking statements even if experience or future changes indicate that any such results or event (expressed or implied Inferred from circumstances; known indirectly. In its legal application, the term implied is used in contrast with express, where the intention regarding the subject matter is explicitly and directly indicated. ) will not be realized. -0-
Base Ten Systems, Inc.
Condensed Consolidated Statements of Operations
(in millions, except per share amounts)
Three Months Fiscal Year
Ended Ended
Dec 31 98 Dec 31 98 Oct 31 97 % change
--------- --------- --------- --------
Revenues $ 1.9 $ 7.6 $ 2.5 204%
Cost and expenses:
Cost of revenues 1.4 6.6 3.4 94%
Amortization of
software development
costs 0.9 3.7 3.0 23%
--------- --------- --------- --------
2.3 10.3 6.4 61%
--------- --------- --------- --------
Gross profit (0.4) (2.7) (3.9) -31%
Research and
development 0.8 2.0 0.2 900%
Sales and marketing 1.6 5.0 2.7 85%
General and
administrative 4.0 9.0 7.7 17%
--------- --------- --------- --------
6.4 16.0 10.6 51%
--------- --------- --------- --------
Loss from continuing
operations (6.8) (18.7) (14.5) 29%
Other expense (0.4) (1.0) (1.5) -33%
--------- --------- --------- --------
Net loss from
continuing operations (7.2) (19.7) (16.0) 23%
Loss from discontinued
operations - - (6.0) -100%
--------- --------- --------- --------
Net loss (7.2) (19.7) (22.0) -10%
========= ========= ========= ========
Loss per common share:
Continuing
operations (0.52) (2.02) (2.03) 0%
Discontinued
operations - - (0.76) -100%
--------- --------- --------- --------
Net loss per
common share $ (0.52) $ (2.02) $ (2.79) -28%
========= ========= ========= ========
Weighted average
common shares 14,424,700 10,618,200 7,895,000 34%
Loss per common
share-assuming dilution:
Continuing
operations (0.52) (2.02) (2.03) 0%
Discontinued
operations - - (0.76) -100%
--------- --------- --------- --------
Net loss per common
share-assuming
dilution $ (0.52) $ (2.02) $ (2.79) -28%
========= ========= ========= ========
Weighted average common
shares-assuming
dilution 14,424,700(a) 10,618,200(a) 7,895,000(a) 34%
---------- ---------- --------- --------
(a) Due to the net loss, the effect of outstanding stock options,
warrants or stock conversions would be anti-dilutive to EPS, and
are, therefore, excluded from the above computation of diluted
EPS.
Base Ten Systems, Inc.
Condensed Consolidated Balance Sheet
audited
(in millions)
Dec 31 98 Dec 31 97 Oct 31 97
--------- ---------- ---------
Current assets:
Cash $ 17.4 $ 9.1 $ 1.5
Accounts
receivable $ 2.9 $ 1.6 $ 1.8
Other current
assets $ 0.6 $ 0.9 $ 6.4
--------- ---------- ---------
Total current
assets $ 20.9 $ 11.6 $ 9.7
Property, plant
and equipment $ 5.0 $ 4.3 $ 4.3
Note receivable $ 2.0 $ 2.2 $ --
Other assets $ 4.8 $ 6.4 $ 7.2
--------- ---------- ---------
Total assets $ 32.7 $ 24.5 $ 21.2
========= ========== =========
Current
liabilities:
Accounts payable $ 0.9 $ 0.3 $ 0.9
Accrued expenses $ 3.9 $ 5.4 $ 6.0
Current portion
of capital lease
obligation $ 0.1 $ 0.1 $ 0.1
--------- ---------- ---------
Total current
liabilities $ 4.9 $ 5.8 $ 7.0
Long-term
liabilities:
Long-term debt $ 10.0 $ 15.5 $ 15.5
Capital lease
obligation $ 3.4 $ 3.4 $ 3.4
Other long-term
liabilities $ 0.2 $ 0.2 $ 0.3
--------- ---------- ---------
Total long-term
liabilities $ 13.6 $ 19.1 $ 19.2
Shareholders'
equity
Preferred stock $ -- $ -- $ --
Class A Common
stock $ 18.7 $ 7.8 $ 7.8
Class B Common
stock $ 0.1 $ 0.4 $ 0.4
Additional
paid-in capital $ 62.1 $ 38.0 $ 29.5
Deficit $(66.2) $(46.5) $(42.7)
--------- ---------- ---------
$ 14.7 $ (0.3) $ (5.0)
Less: Treasury
stock $ (0.3) $ -- $ --
Equity adjustment
from foreign
currency
translation $ (0.3) $ (0.2) $ (0.1)
Unrealized gain
on securities
available
for sale $ 0.1 $ 0.1 $ 0.1
--------- ---------- ---------
Total shareholders'
equity $ 14.2 $ (0.4) $ (5.0)
--------- ---------- ---------
Total liabilities
and shareholders'
equity $ 32.7 $ 24.5 $ 21.2
========= ========== =========
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