Best Software Acquires Assets of OmniVista Software and Announces Final Results for the Fourth Quarter and the Year.RESTON Reston, uninc. city (1990 pop. 48,556), Fairfax co., N Va., a planned community established in 1961. A suburb of Washington, D.C., Reston is organized in a series of residential villages and commercial areas. , Va.--(BUSINESS WIRE)--March 25, 1999--Best Software, Inc. (Nasdaq: BEST) today announced that it has acquired the assets of OmniVista Software Corporation, a leading provider of planning and analytical analytical, analytic pertaining to or emanating from analysis. analytical control control of confounding by analysis of the results of a trial or test. applications. OmniVista's products will be marketed as Best! Imperativ Analytics, joining the award-winning Adj. 1. award-winning - having received awards; "this award-winning bridge spans a distance of five miles" Best! Imperativ product line which includes Best! Imperativ HRMS HRMS Human Resource Management System HRMS High Resolution Microwave Survey (SETI, Project Phoenix) HRMS High Resolution Mass Spectroscopy HRMS High Resolution Molecular Spectroscopy HRMS Human Resources Management Specialist and Best! Imperativ Asset Accounting. The Company also announced the resolution of its discussions with the Securities and Exchange Commission ("SEC") on the accounting treatment of its acquisitions made in 1998 and accordingly released final results for the fourth quarter and year. "OmniVista's products are a strategic fit with our mission to provide customers with corporate resource management solutions designed to help them better manage their people, assets and planning," said Tim Davenport Davenport, city (1990 pop. 95,333), seat of Scott co., E central Iowa, on the Mississippi River; inc. 1836. Bridges connect it with the Illinois cities of Rock Island and Moline; the three communities and neighboring Bettendorf, Iowa, are known as the Quad Cities. , 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. and president of Best Software. "OmniVista has an impressive installed base in the middle market, and we believe their development team will be a tremendous addition to our technical organization." All of the operations of OmniVista, located in Peninsula, Ohio Peninsula is a village in Summit County, Ohio, United States. The population was 602 at the 2000 census. It is located in the middle of the Cuyahoga Valley National Park, providing a source of tourism to the village. Blossom Music Center is located on its outskirts. , will remain intact. "We are very excited to be joining Best Software. We believe that the combination of our strong products and Best Software's high profile in the middle market is a powerful one," said Dan Quigg, president and founder of OmniVista. "It's it's 1. Contraction of it is. 2. Contraction of it has. See Usage Note at its. it's it is or it has it's be ~have an excellent opportunity for us to take advantage of the rapidly growing analytical applications market." OmniVista's product line includes the major components of the fast growing analytical applications market including strategic planning Strategic planning is an organization's process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy, including its capital and people. , budgeting and allocations. OmniVista has been a leading provider of analytical applications for two years. Best Software will account for the acquisition as a purchase and expects to write off a portion of the purchase amount as in-process research and development ("IPR&D") using the SEC's new guidelines guidelines, n.pl a set of standards, criteria, or specifications to be used or followed in the performance of certain tasks. . The closing occurred effective March 25, 1999. Excluding the write-off Write-Off A reduction in the value of an asset or earnings by the amount of an expense or loss. Companies are able to write off certain expenses that are required to run the business, or have been incurred in the operation of the business and detract from retained revenues. , Best Software anticipates that this acquisition will be non-dilutive to earnings for 1999. The Company also has resolved how the SEC's new guidelines for writing off IPR&D affected its 1998 acquisition accounting and has released final 1998 financial results which comply with those new guidelines. The write-off of IPR&D for the March 1998 acquisition of HR Management Software GmbH GmbH Gesellschaft mit Beschränkter Haftung (German: limited liability company; business entity) ("HRS hrs abbr (= hours) → h hrs abbr (= hours) → Std. ") was reduced to $3.9 million from $9.4 million and the write-off of IPR&D for the October October: see month. 1998 acquisition of a product line from HRSoft, Inc. was set at $320,000. The Company's fundamentals were not impacted by any changes required by the SEC and thus the results of its operations before amortization and write-offs were not affected. The Company's 1998 revenue remained unchanged at $69.3 million. 1998 operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. was $6.8 million, net income was $5.6 million and diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of were $0.46. The amortization of acquired intangibles Property that is a "right" such as a patent, Copyright, or trademark, or one that is lacking physical existence, such as good will. from the HRS and HRSoft acquisitions is currently $336,000 per quarter, an increase from the $72,000 per quarter reported previously. Best Software, with offices in the US, Canada Canada (kăn`ədə), independent nation (2001 pop. 30,007,094), 3,851,787 sq mi (9,976,128 sq km), N North America. Canada occupies all of North America N of the United States (and E of Alaska) except for Greenland and the French islands of and Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). , is a
leading provider of corporate resource management solutions, helping
organizations better manage their people, assets and planning. Its
cost-effective cost-effective,n the minimal expenditure of dollars, time, and other elements necessary to achieve the health care result deemed necessary and appropriate. solutions complement core accounting systems and are scaleable, supporting Microsoft (Microsoft Corporation, Redmond, WA, www.microsoft.com) The most successful and influential software company. Microsoft's software and Intel's hardware pioneered the PC and revolutionized the computer industry. (R) technology including Windows(R) 95, Windows NT (Windows New Technology) A 32-bit operating system from Microsoft for Intel x86 CPUs. NT is the core technology in Windows 2000 and Windows XP (see Windows). Available in separate client and server versions, it includes built-in networking and preemptive multitasking. (R), and BackOffice An earlier suite of network server software products from Microsoft that was licensed and supported as one inclusive bundle. The suite was discontinued in late 2001, but some of the underlying products and their client access licenses (CALs) remained as stand-alone products. (R). Best Software will hold an investor conference call today at 5:30 p.m. Eastern time. Those US and Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. investors interested in participating should dial 800-260-0702 and reference the Best Software Conference Call, chaired by Tim Davenport and David Bosserman. Overseas investors should dial 612-332-0523. Forward looking statements in this release, including statements regarding the delivery and integration of new products and expectations for revenue and earnings, are based on information available to the Company as of the date hereof here·of adv. Of this. hereof Adverb Formal or law of or concerning this Adv. 1. hereof - of or concerning this; "the twigs hereof are physic" . Such forward looking statements are made only as of the date hereof. The Company's actual results could differ materially from those stated 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. by such forward looking statements due to risks and uncertainties associated with fluctuations in the Company's quarterly operating results, concentration of the Company's product offerings, development risks involved with new products and technologies, competition, and other risk factors disclosed dis·close tr.v. dis·closed, dis·clos·ing, dis·clos·es 1. To expose to view, as by removing a cover; uncover. 2. To make known (something heretofore kept secret). in the Company's filings with the Securities and Exchange Commission. NOTE TO EDITORS: Best Software, Best! Imperativ, Best! Imperativ Analytics, Best! Imperativ HRMS, and Best! Imperativ Asset Accounting are trademarks, and the Best logo is a registered trademark of Best Software, Inc. Microsoft, Windows, Windows 95, Windows NT, and BackOffice are registered trademarks of Microsoft Corporation (company) Microsoft Corporation - The biggest supplier of operating systems and other software for IBM PC compatibles. Software products include MS-DOS, Microsoft Windows, Windows NT, Microsoft Access, LAN Manager, MS Client, SQL Server, Open Data Base Connectivity (ODBC), MS Mail, . All other trademarks are the property of their respective holders. The historical and 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 results of operations for the quarter and twelve months ended December December: see month. 31 follow. -0-
Best Software, Inc.
Pro Forma Consolidated Financial Information - Unaudited
Pro Forma Consolidated Statements of Operations
(in thousands, except per share amounts)
Quarter Ended Twelve Months Ended
December 31 December 31
1998 1997 1998 1997
---- ---- ---- ----
Revenue:
License fees and royalties $10,229 $7,138 $34,406 $23,375
Services 11,148 6,932 34,924 23,332
------- ------ ------- -------
Total 21,377 14,070 69,330 46,707
------- ------- ------- -------
Cost of revenue:
License fees and royalties 680 517 1,997 2,247
Services 3,428 1,573 11,425 6,100
------- ------- ------- -------
Total 4,108 2,090 13,422 8,347
------- ------- ------- -------
Gross margin 17,269 11,980 55,908 38,360
------- ------- ------- -------
Operating expenses:
Sales and marketing 7,494 4,525 24,604 16,792
Research and development 3,438 2,524 11,157 7,987
General and administrative
(Note 1) 2,297 1,640 8,295 6,201
------- ------- ------- -------
Total operating expenses,
excluding acquisition-
related charges 13,229 8,689 44,056 30,980
------- ------- ------- -------
Operating income 4,040 3,291 11,852 7,380
Other income, net 565 475 2,323 389
------- ------- ------- -------
Income before income taxes 4,605 3,766 14,175 7,769
Income tax provision
(Note 2) 1,750 1,440 5,380 2,975
------- -------- ------- -------
Net income $2,855 $2,326 $8,795 $4,794
======= ======== ======= =======
Basic earnings per
common share $0.25 $0.21 $0.77 $0.57
======= ======= ======= =======
Diluted earnings per
common share $0.23 $0.20 $0.72 $0.48
======= ======== ======= =======
Basic shares used in
computing earnings
Per share 11,652 10,846 11,455 8,483
======= ======= ======= =======
Diluted shares used in
computing earnings
Per share 12,370 11,751 12,180 9,961
======= ======= ======= =======
Note 1. For the quarter ended December 31, 1998, excludes $320,000
related to the write-off of IPR&D related to the $1.8 million
acquisition of a software product line from HRSoft and $336,000 in
amortization of acquired intangibles. For the twelve months ended
December 31, 1998, excludes $320,000 related to the write-off of IPR&D
related to the $1.8 million acquisition of a software product line
from HRSoft, $3.9 million related to the write-off of IPR&D related to
the $10.4 million acquisition in March 1998 of HRS, and $882,000 in
amortization of acquired intangibles.
Note 2. The twelve-month period ended December 31, 1997, reflects the
Company's current effective tax rate of 38%. As reported, Best
Software recorded an income tax benefit during the March 1997 quarter
of approximately 28% or $455,000 representing a $1.1 million one-time
benefit to the Company.
Best Software, Inc.
Consolidated Financial Information - Unaudited
Consolidated Statements of Operations
(in thousands, except per share amounts)
Quarter Ended Twelve-Months Ended
December 31 December 31
1998 1997 1998 1997
---- ---- ---- ----
Revenue:
License fees and royalties $10,229 $7,138 $34,406 $23,375
Services 11,148 6,932 34,924 23,332
--------- --------- --------- ---------
Total 21,377 14,070 69,330 46,707
--------- --------- --------- ---------
Cost of revenue:
License fees and royalties 680 517 1,997 2,247
Services 3,428 1,573 11,425 6,100
--------- --------- --------- ---------
Total 4,108 2,090 13,422 8,347
--------- --------- --------- ---------
Gross margin 17,269 11,980 55,908 38,360
--------- --------- --------- ---------
Operating expenses:
Sales and marketing 7,494 4,525 24,604 16,792
Research and development 3,438 2,524 11,157 7,987
General and administrative 2,297 1,640 8,295 6,201
Amortization of acquired
intangibles 336 -- 882 --
Write-off of purchased
research and development 320 -- 4,170 --
--------- --------- --------- ---------
Total 13,885 8,689 49,108 30,980
--------- --------- --------- ---------
Operating income 3,384 3,291 6,800 7,380
Other income, net 565 475 2,323 389
--------- --------- --------- ---------
Income before income taxes 3,949 3,766 9,123 7,769
Income tax provision 1,530 1,440 3,500 1,895
========= ========= ========= =========
Net income $2,419 $2,326 $5,623 $5,874
========= ========= ========= =========
Basic earnings per
common share $0.21 $0.21 $0.49 $0.69
========= ========= ========= =========
Diluted earnings per
common share $0.20 $0.20 $0.46 $0.59
========= ========= ========= =========
Basic shares used in
computing earnings
Per share 11,652 10,846 11,455 8,483
========= ========= ========= =========
Diluted shares used in
computing earnings
Per share 12,370 11,751 12,180 9,961
========= ========= ========= =========
Consolidated Condensed Balance Sheets
(In thousands) December 31 December 31
1998 1997
---- ----
Assets:
Cash, cash equivalents and short term
investments $46,280 $45,432
Accounts receivable, net of allowances 8,198 4,661
Other current assets 3,130 2,399
Property and equipment, net 4,333 2,182
Deferred tax asset 4,521 2,300
Other intangibles 7,178 --
Other non-current assets 930 36
============ ===============
Total assets $74,570 $57,010
============ ===============
Liabilities and Shareholders' Equity:
Current deferred maintenance and
services revenue $19,350 $14,918
Other current liabilities 14,394 11,025
Non-current deferred maintenance and
services revenue 616 1,313
Other non-current liabilities 125 --
------------ ---------------
Total liabilities 34,485 27,256
------------ ---------------
Total shareholders' equity 40,085 29,754
============ ===============
Total liabilities and shareholders'
equity $74,570 $57,010
============ ===============
Best Software, Inc.
Supplemental Consolidated Financial Information - Unaudited
Pro Forma Consolidated Statements of Operations
for 1998 on a Quarterly Basis
(in thousands, except per share amounts)
Quarter Ended
March 31, June 30, Sept. 30, Dec. 31,
--------- -------- --------- --------
1998 1998 1998 1998
--------- -------- --------- --------
Revenue:
License fees and
royalties $6,803 $8,339 $9,035 $10,229
Services 6,895 7,914 8,967 11,148
------- ------- ------- -------
Total 13,698 16,253 18,002 21,377
------- ------- ------- -------
Cost of revenue:
License fees and royalties 440 455 422 680
Services 2,139 2,807 3,051 3,428
------- ------- ------- -------
Total 2,579 3,262 3,473 4,108
------- ------- ------- -------
Gross margin 11,119 12,991 14,529 17,269
------- ------- ------- -------
Operating expenses:
Sales and marketing 4,704 5,847 6,559 7,494
Research and development 2,121 2,700 2,898 3,438
General and administrative
(Note 1) 1,710 2,024 2,264 2,297
------- ------- ------- -------
Total operating expenses,
excluding acquisition
related charges 8,535 10,571 11,721 13,229
------- ------- ------- -------
Operating income 2,584 2,420 2,808 4,040
Other income, net 594 558 606 565
------- ------- ------- -------
Income before income
taxes 3,178 2,978 3,414 4,605
Income tax provision 1,200 1,130 1,300 1,750
======= ======= ======= =======
Net income $1,978 $1,848 $2,114 $2,855
======= ======= ======= =======
Basic earnings per common
share $0.18 $0.16 $0.18 $0.25
======= ======= ======= =======
Diluted earnings per common
share $0.17 $0.15 $0.17 $0.23
======= ======= ======= =======
Basic shares used in
computing earnings per
share 10,981 11,568 11,610 11,652
======= ======= ======= =======
Diluted shares used in
computing earnings per
share 11,872 12,249 12,284 12,370
======= ======= ======= =======
Note 1. For the quarter ended December 31, 1998, excludes
acquisition costs including $320,000 related to the write-off of IPR&D
related to the $1.8 million acquisition of a software product line
from HRSoft and $336,000 in amortization of acquired intangibles. For
the quarter ended March 31, 1998, excludes $3.9 million related to the
write-off of IPR&D related to the $10.4 million acquisition in March
1998 of HRS.
Best Software, Inc.
Supplemental Consolidated Financial Information - Unaudited
Consolidated Statements of Operations
for 1998 on a Quarterly Basis
(in thousands, except per share amounts)
Quarters Ended
March 31, June 30, Sept. 30 Dec. 31,
1998 1998 1998 1998
--------- --------- --------- ---------
Revenue:
License fees & royalties $6,803 $8,339 $9,035 $10,229
Services 6,895 7,914 8,967 11,148
--------- --------- --------- ---------
Total 13,698 16,253 18,002 21,377
--------- --------- --------- ---------
Cost of revenue:
License fees & royalties 440 455 422 680
Services 2,139 2,807 3,051 3,428
--------- --------- --------- ---------
Total 2,579 3,262 3,473 4,108
--------- --------- --------- ---------
Gross margin 11,119 12,991 14,529 17,269
--------- --------- --------- ---------
Operating expenses:
Sales and marketing 4,704 5,847 6,559 7,494
Research and development 2,121 2,700 2,898 3,438
General and administrative 1,710 2,024 2,264 2,297
Amortization of acquired
intangibles -- 273 273 336
Write-off of purchased
research & development 3,850 -- -- 320
--------- --------- --------- ---------
Total 12,385 10,844 11,994 13,885
--------- --------- --------- ---------
Operating income (loss) (1,266) 2,147 2,535 3,384
Other income, net 594 558 606 565
--------- --------- --------- ---------
Income (loss) before income
taxes (672) 2,705 3,141 3,949
Income tax provision 270 1,040 1,200 1,530
========= ========= ========= =========
Net income (loss) ($402) $1,665 $1,941 $2,419
========= ========= ========= =========
Basic earnings (loss) per
common share ($0.04) $0.14 $0.17 $0.21
========= ========= ========= =========
Diluted earnings (loss) per
common share ($0.04) $0.14 $0.16 $0.20
========= ========= ========= =========
Basic shares used in
computing earnings
(loss) per share 10,981 11,568 11,610 11,652
========= ========= ========= =========
Diluted shares used in
computing earnings
(loss) per share 10,981 12,249 12,284 12,370
========= ========= ========= =========
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