BindView Announces Financial Results for Fourth Quarter and Full Year 2003; Revenues Exceed High End of Estimates.Business Editors/High-Tech Writers HOUSTON--(BUSINESS WIRE)--Feb. 3, 2004 BindView Now part of Symantec Corporation, BindView Development Corporation (NASDAQ: BVEW) was founded in 1990 by Eric Pulaski - who remained as Chairman of the Board and Chief Executive Officer up until the acquisition by Symantec in December 2005. Corporation (Nasdaq:BVEW BVEW Binary View ), a leading provider of policy compliance, vulnerability management and directory administration solutions, today announced results for the quarter and year ended Dec. 31, 2003. Revenues for the fourth quarter of 2003 were $23.9 million, an increase of 24 percent year-over-year, and exceeded the high end of the Company's previously announced revenue estimates of $19.5 million to $23.5 million. License revenues for the fourth quarter of 2003 were $15.6 million, up 34 percent year-over-year. This growth was a result of a strong pipeline at the beginning of the quarter and improved sales efficiency, which benefited from improved close rates on large transactions. Services revenues were $8.3 million, up 10 percent year-over-year, and were comprised of $7.0 million in maintenance and $1.3 million in professional services (job) professional services - A department of a supplier providing consultancy and programming manpower for the supplier's products. . Net income for the fourth quarter of 2003 was $2.4 million ($0.05 per share), compared with $1.4 million ($0.03 per share) for the fourth quarter of 2002, and within the Company's previously announced earnings estimates of $0.5 million to $4.2 million ($0.01 to $0.09 per share). Although revenues exceeded the high end of the Company's estimated range, net income was below the high end of the net income range due primarily to a $1.6 million ($0.03 per share) restructuring charge restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. for excess leasehold An estate, interest, in real property held under a rental agreement by which the owner gives another the right to occupy or use land for a period of time. leasehold n. space in Houston Houston, city (1990 pop. 1,630,553), seat of Harris co., SE Tex., a deepwater port on the Houston Ship Channel; inc. 1837. Economy The fourth largest city in the nation and the largest in the entire South and Southwest, Houston is a port of entry; . This charge included the effects of a payment made in December December: see month. 2003 to cancel the excess space (the maximum allowable under the lease agreement) and an increase in the estimated carrying costs Carrying costs Costs that increase with increases in the level of investment in current assets. of the remaining excess space. Revenues for the full year 2003 were $67.8 million, up from $67.0 million in 2002. Net loss for the year was $3.6 million ($0.08 per share), compared with a net loss of $24.4 million ($0.49 per share) in 2002. The 2003 net loss included restructuring charges of $2.2 million ($0.05 per share), compared with 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). and asset impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. charges totaling $22.8 million ($0.45 per share) in 2002. At Dec. 31, 2003, the Company's cash and cash equivalents were $35.4 million compared with $37.8 million at Dec. 31, 2002. The year-over-year decline included the one-time payment of $1.9 million in December 2003 to cancel the lease on approximately two-thirds of the Company's excess office space in Houston. Excluding this one-time payment, the decline was approximately $0.4 million. Working capital at year-end was $28.3 million, up $2.0 million from the preceding year-end. The Company had no outstanding debt at year-end. "Strong pipeline and solid execution in the fourth quarter generated the second best revenue quarter in our history, exceeding previous estimates for Q4 and the second half of 2003," said 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. Eric Pulaski. "This performance caps three consecutive quarters of positive trending for pipeline and execution in our business, allowing us to close the year with a solid finish and post the first year-over-year revenue increase since 2000. "We're entering the year with a strong pipeline, with positive momentum from our Q4 performance and with a more experienced team. BindView's go-to-market strategy is gaining traction Traction Definition Traction is the use of a pulling force to treat muscle and skeleton disorders. Purpose Traction is usually applied to the arms and legs, the neck, the backbone, or the pelvis. , our value proposition is resonating res·o·nate v. res·o·nat·ed, res·o·nat·ing, res·o·nates v.intr. 1. To exhibit or produce resonance or resonant effects. 2. with customers, and the foundation we set during 2003 has us well positioned to achieve improved year-over-year growth in 2004." Fourth Quarter Highlights Regulatory Compliance: New release of Compliance Center (v1.5) provides customers with enhanced capabilities to build and deploy internal standards for measuring compliance with industry, regulatory and audit mandates across their business-critical IT infrastructures. Patch Management The installation of patches from a software vendor onto an organization's computers. Patching thousands of PCs and servers is a major issue. A patch should be applied to test machines first before deployment, and the testing environments must represent all the users' PCs with their unique : Announced partnership agreement with Shavlik Technologies which will provide customers with enhanced threat analysis, patch prioritization and patch deployment tools, helping them to guard against the dramatic proliferation proliferation /pro·lif·er·a·tion/ (pro-lif?er-a´shun) the reproduction or multiplication of similar forms, especially of cells.prolif´erativeprolif´erous pro·lif·er·a·tion n. of worms Worms (vôrms), city (1994 pop. 79,155), Rhineland-Palatinate, SW Germany, on the Rhine River. It is an industrial city and a leading wine trade center. , viruses and other forms of attack. Microsoft: Partnered with Microsoft and Windows & .Net Magazine in a three-city security road show in Chicago, 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 New Jersey. Novell: New release of bv-Control for NetWare (v7.52) and NDS/eDirectory begins shipping this month with support for the DirXML engine, allowing customers to connect and synchronize See synchronization. disparate directories to NDS See eDirectory. NDS - Netware Directory Services , and iManager Role Based Services Roles allowing IT administrators and security auditors AUDITORS, practice. Persons lawfully appointed to examine and digest accounts referred to them, take down the evidence in writing, which may be lawfully offered in relation to such accounts, and prepare materials on which a decree or judgment may be made; and to report the whole, together to specifically identify user access rights and permissions. Hewlett Packard: Launched new HP OpenView HP OpenView was a Hewlett Packard product range consisting of an extensive portfolio of network and systems management products. In 2007 the entire HP OpenView portfolio was rebranded under the strengthened HP Software name. Smart Plug-In for protecting customers' HP environments. CSC (Card Security Code) A three- or four-digit number printed on the back of credit cards for security purposes. Called "Card Verification Value" (CVV) by Visa, "Card Validation Code" (CVC) by MasterCard and "Card Identification (CID) by American Express and Discover, : Announced global licensing agreement to provide BindView Directory Administration & Migration solutions to CSC and its global client base. Vulnerability Alerts: Issued three Media Advisories on four newly discovered global vulnerabilities affecting customer infrastructures. Insight 03: More than 400 participants, including customers, partners and consultants, attended BindView's annual customer forum in Las Vegas Las Vegas (läs vā`gəs), city (1990 pop. 258,295), seat of Clark co., S Nev.; inc. 1911. It is the largest city in Nevada and the center of one of the fastest-growing urban areas in the United States. . 2004 Key Initiatives Sales and Marketing: Management believes the Company has strong momentum going into 2004, evidenced by performance improvements in the second half of 2003, and that overall sales efficiency will continue to improve during 2004. Management also believes the Company's pipeline is sufficient to meet its revenue targets for the first half of 2004, and is continuing to implement lead generation programs to produce sufficient pipeline to meet revenue targets for the second half of 2004 and into 2005. Research and Development: The Company will aggressively pursue the development of its next-generation products in 2004. Accordingly, the Company will sharply focus on expanding existing products and services that help customers deal with the burden of regulatory compliance, as well as delivering new products that further enable customers to take a process-oriented approach to managing IT risk across the organization with a product suite that integrates the efforts of disparate departments including IT, information security, audit and compliance. To deliver on BindView's 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. product strategy, the Company will expand its development operations in India, allowing it to minimize the near-term cost impact. This expansion will include investment in new office space and other infrastructure, as the Company has outgrown its existing facilities in India, and the hiring of additional developers and management personnel. The expansion, including one-time transition costs to new operating facilities, is expected to increase R&D expenses by $2.0 million to $2.5 million in 2004. 2004 Financial Goals and Target Financial Model The Company estimates 2004 revenues to range between $75 million and $80 million, and net income to range between $1.5 million and $3.5 million ($0.03 and $0.07 per share). Revenues for the first half of 2004 are expected to range between $32 million and $36 million, and the net loss to range between $2.0 million and $4.0 million ($0.04 and $0.08 per share). The Company's 2004 profitability goals reflect costs associated with sizing the sales force and marketing programs to achieve the high end of its revenue targets, increases in salaries and healthcare benefits, compliance with Sarbanes-Oxley requirements, and R&D expansion. The Company believes its ability to achieve the high end of the 2004 revenue range is dependent upon a number of factors, including increases in overall sales efficiency and the second half pipeline. The Company believes its 2004 key initiatives in sales, marketing and R&D will support planned growth for the year, and also provide higher operating leverage Operating Leverage A measurement of the degree to which a firm or project relies on fixed rather than variable costs. Notes: The higher the degree of operating leverage, the greater the potential danger from forecasting risk. and the necessary base to increase license revenues in line with or better than market growth rates Growth Rates The compounded annualized rate of growth of a company's revenues, earnings, dividends, or other figures. Notes: Remember, historically high growth rates don't always mean a high rate of growth looking into the future. . At these growth rates, the Company expects its operating margins Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: to expand approximately 5 percentage points annually beginning in 2005, attaining target operating margins of 15 percent to 25 percent during the next 3 to 5 years. Scheduled Conference Call The company will conduct a conference call today at 4:00 p.m. CST CST abbr. 1. Central Standard Time 2. convulsive shock treatment CST Central Standard Time Noun 1. to discuss details of the fourth quarter financial results and its 2004 financial outlook. The conference will be available for replay at 1-888-203-1112; code 436849, from 7:00 p.m. CST, through Feb. 10, 2004. Interested parties should dial 877-502-9273; code 436849. A Webcast also will be provided live at: http://www.bindview.com/About/IR/Calls.cfm/. About BindView Corporation BindView Corporation is a leading provider of proactive business policy, IT security and directory management software worldwide. BindView solutions and services enable customers to centralize cen·tral·ize v. cen·tral·ized, cen·tral·iz·ing, cen·tral·iz·es v.tr. 1. To draw into or toward a center; consolidate. 2. and automate To turn a set of manual steps into an operation that goes by itself. See automation. policy compliance, vulnerability assessment A Department of Defense, command, or unit-level evaluation (assessment) to determine the vulnerability of a terrorist attack against an installation, unit, exercise, port, ship, residence, facility, or other site. , directory administration and migration across the entire organization. With BindView insight at work(TM), customers benefit from reduced risk and improved operational efficiencies with a verifiable return on investment. More than 20 million licenses have shipped to 5,000 companies worldwide, spanning all major business segments and the public sector. Contact BindView via e-mail at info@bindview.com or visit our Web site at http://www.bindview.com/. BindView can be reached at 800-749-8439 or 713-561-4000. Statements in this news release not based on historical fact are "forward-looking" statements pursuant to the safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. provisions 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. Actual results could differ materially because of factors such as the risk factors and other matters described from time to time in BindView's 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. filings, Form 10-Q Form 10-Q See 10-Q. filings, and other periodic filings with the Securities and Exchange Commission, including without limitation the time required for large transactions to close and the general willingness of customers to make investments in information technology. Editors Note: BindView(R), the BindView logo, and the BindView product names used in this document are trademarks of BindView Development Corporation, which may be registered in one or more jurisdictions. The names of products of other companies mentioned in this document, if any, may be the registered or unregistered trademarks of the owners of the products.
BindView Development Corporation
Consolidated Statements of Operations (unaudited)
(in thousands, except per share amounts)
Three Months Ended Year Ended
December 31, December 31,
------------------ -------------------
2003 2002 2003 2002
-------- --------- --------- ---------
Revenues:
Licenses $15,588 $11,618 $35,530 $37,238
Services 8,344 7,608 32,315 29,740
-------- --------- --------- ---------
23,932 19,226 67,845 66,978
-------- --------- --------- ---------
Cost of revenues:
Licenses 178 114 527 500
Services 1,862 1,415 6,954 5,782
-------- --------- --------- ---------
2,040 1,529 7,481 6,282
-------- --------- --------- ---------
Gross profit 21,892 17,697 60,364 60,696
Operating costs and expenses:
Sales and marketing 10,744 8,633 36,040 37,242
Research and development 5,058 4,299 18,423 19,219
General and administrative 2,150 2,164 7,750 7,932
Restructuring 1,635 1,394 2,184 3,002
Asset impairment - - - 276
-------- --------- --------- ---------
19,587 16,490 64,397 67,671
-------- --------- --------- ---------
Operating income (loss) 2,305 1,207 (4,033) (6,975)
Other income, net 99 191 447 2,104
-------- --------- --------- ---------
Income (loss) before income
taxes 2,404 1,398 (3,586) (4,871)
Provision for income taxes 50 - 50 19,562
-------- --------- --------- ---------
Net income (loss) $2,354 $1,398 $(3,636) $(24,433)
========= ========= ========= =========
Income (loss) per share -
basic and diluted $0.05 $0.03 $(0.08) $(0.49)
========= ========= ========= =========
Number of shares used to
calculate per
share amounts:
Basic 46,978 47,346 46,714 50,319
Diluted 49,638 47,538 46,714 50,319
BindView Development Corporation
Consolidated Balance Sheets
December 31, 2003 and 2002
(in thousands)
2003 2002
----------- -----------
(unaudited)
Cash and cash equivalents $35,449 $37,760
Cash - restricted 2,750 -
Accounts receivable, net 14,337 11,199
Other 2,180 2,052
----------- -----------
Total current assets 54,716 51,011
Property and equipment, net 6,564 7,816
Investments and other 1,998 4,729
----------- -----------
Total assets $63,278 $63,556
----------- -----------
Accounts payable $2,066 $1,990
Accrued liabilities 5,679 6,341
Accrued compensation 5,275 3,907
Deferred revenues 13,351 12,464
----------- -----------
Total current liabilities 26,371 24,702
Deferred revenues 1,477 2,213
Other 1,287 1,215
Common stock 1 1
Additional paid-in capital 105,176 104,332
Accumulated deficit (72,034) (68,398)
Notes receivable from shareholders (392) (892)
Accumulated other comprehensive income 1,392 383
----------- -----------
Total shareholders' equity 34,143 35,426
----------- -----------
Total liabilities and shareholders'
equity $63,278 $63,556
----------- -----------
Common shares outstanding 47,034 46,278
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