Bitstream Inc. Reports Fourth Quarter and Annual Financial Results for 2005.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. -- As a result of an increase in quarterly revenue for the quarter ended December December: see month. 31, 2005 of $1,295,000 or 39% to $4,618,000, we attained at·tain v. at·tained, at·tain·ing, at·tains v.tr. 1. To gain as an objective; achieve: attain a diploma by hard work. 2. our highest quarterly revenue level since going public in 1996, contributing to our attainment of a $788,000 net income or $0.08 diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. net income per share for the fourth quarter and a $1,034,000 net income or $0.11 diluted net income per share for the year. Bitstream The transmission, or flow, of binary data (bits). Inc. (Nasdaq: BITS) today reported that its total revenue increased $1,295,000 or 39% to $4,618,000 for the three months ended December 31, 2005 as compared to $3,323,000 for the three months ended December 31, 2004. Total revenue for the twelve months ended December 31, 2005 increased $4,021,000 or 34.6% to $15,653,000 as compared to $11,632,000 for the twelve months ended December 31, 2004. We generated a profit from operations of $799,000 for the three months ended December 31, 2005, an increase of $777,000 as compared to $22,000 for the three months ended December 31, 2004. Our 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. for the year ended December 31, 2005 was $1,038,000 an improvement of $1,773,000 as compared to a loss of $(735,000) for the year ended December 31, 2004. Our net income for the three months ended December 31, 2005 increased $748,000 to $788,000 or $0.08 per diluted share as compared to $40,000 for the three months ended December 31, 2004. Our net income for the year ended December 31, 2005 improved $1,649,000 to $1,034,000 or $0.11 per diluted share as compared to a loss of $(615,000) for the year ended December 31, 2004. The Company's cash and cash equivalents at December 31, 2005 totaled $5,464,000, an increase of $665,000 from $4,799,000 at September September: see month. 30, 2005 and an increase of $1,059,000 from $4,405,000 at December 31, 2004. "Strong sales during the fourth quarter across all of our product lines allowed us to achieve our highest quarterly and annual sales, and highest overall revenue 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. since we went public in 1996. All of our products demonstrated enhanced market penetration Noun 1. market penetration - the extent to which a product is recognized and bought by customers in a particular market penetration - the act of entering into or through something; "the penetration of upper management by women" in markets that we expect to continue to develop and grow in the year ahead. Our revenue for the year and the quarter allowed us to exceed our prediction of breakeven breakeven 1. The level of output or sales necessary to cover fixed expenses. Companies in industries that have high fixed costs and, consequently, high breakevens, such as automobile and steel manufacturing, are likely to exhibit large fluctuations performance in 2005 and to achieve a very profitable year as evidenced by our net profit for the quarter and year ended December 31, 2005 of $788,000 and $1,034,000." said Anna M. Chagnon, President and Chief Executive Officer. "We believe that we are well positioned to extend this momentum in 2006 by focusing on increasing revenue across all of our product lines and managing costs to enhance our profitability in the year ahead." FOURTH QUARTER 2005 HIGHLIGHTS AND OTHER RECENT DEVELOPMENTS November November: see month. 3, 2005 -- Bitstream announced the release of Font Fusion Bitstream Font Fusion is a small, fast, object-oriented font engine written in ANSI C capable of rendering high-quality text on any platform, any device, and at any resolution. The entire source code is portable, optimized, and executes independent of operating system and processor. (R) 3.1, company's smallest, most advanced font rasterizing rasterizing - rasterising engine and the fastest font engine on the market today. December 5, 2005 -- A research study released by The Center for Women's Leadership at Babson College Babson College, located in Wellesley, Massachusetts (zoned as "Babson Park," ZIP code 02457),[1] is a private business school that grants all undergraduates a Bachelor of Science in Business Administration. The F. W. and The Commonwealth Institute named Bitstream as one of the Top 100 Women Led Businesses in Massachusetts Massachusetts (măsəch  `sĭts), most populous of the New England states of the NE United States. .December 7, 2005 -- Bitstream announced the release of Pageflex Persona persona /per·so·na/ (per-so´nah) [L.] in jungian psychology, the personality mask or facade presented by a person to the outside world, as opposed to the anima, the inner being. per·so·na n. Cross Media Suite, a completely new desktop software application suite that enables customers to create targeted, personalized per·son·al·ize tr.v. per·son·al·ized, per·son·al·iz·ing, per·son·al·iz·es 1. To take (a general remark or characterization) in a personal manner. 2. To attribute human or personal qualities to; personify. content in both print and email. December 14, 2005 -- Bitstream announced the release of ThunderHawk Symbian Series60 (S60) Edition. The new version gives users of select Symbian platform devices access to award-winning ThunderHawk technology, including the browser's unique split screen view for effortless ef·fort·less adj. Calling for, requiring, or showing little or no effort. See Synonyms at easy. ef  fort·less·ly adv. navigation on small screen phones.January 11, 2006 -- Bitstream announced the December release Pageflex Storefront 3.0. This is a major new software release that includes several new features that enable users to expand their e-commerce e-commerce, commerce conducted over the Internet, most often via the World Wide Web. E-commerce can apply to purchases made through the Web or to business-to-business activities such as inventory transfers. capabilities to include online ordering and campaign management services. February 1, 2006 -- Bitstream and Canon U.S.A., Inc. announced that Pageflex Persona(TM) Cross Media Suite has been designated by Canon U.S.A. as "Canon Compatible" under the Canon U.S.A. Alliance program after successful completion of testing by VeriTest, a service of Lionbridge and a leading provider of independent outsourced testing services. February 6, 2006 -- Bitstream announced the addition of The New Lincoln Lincoln, city and district, England Lincoln, city (1991 pop. 79,980) and district, Lincolnshire, E England, in the Parts of Kesteven, on the Witham River. Gothic font set to its New Font Collection program. This set includes 24 OpenType fonts in one extended family. February 13, 2006 -- Bitstream announced the release of ThunderHawk Windows Mobile The Windows platform from Microsoft for handheld devices, including PDAs, cellphones and Portable Media Centers. See Pocket PC, Pocket PC Phone Edition, Smartphone and Portable Media Center. 5.0 Pocket PC Edition, which offers users a fast, secure desktop browsing See browse. experience along with new Windows Mobile 5.0 technology. CONFERENCE CALL REMINDER Today, February 27, 2006, at 4:30 p.m. EST P.M. also p.m. or p.m. abbr. post meridiem Usage Note: By definition, 12 a.m. , Bitstream will host a conference call with the financial community to discuss its fourth quarter and annual results for the periods ended December 31, 2005: --International Dial-in number: 703-639-1212 --Domestic Dial-in number: 866-256-3815 Call into the conference number 5-10 minutes prior to the start time. An operator will check your name and organization and ask you to wait until the call begins. If you have any difficulty connecting with the conference call number, please contact at Bitstream: (617) 497-6222. A replay of the conference call will be available through March 10, 2006 (access code): 861584 --International Replay number: 703-925-2533 --Domestic Replay number: 888-266-2081 This press release may contain 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 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 statements are based on management's current expectations. Actual performance and results of operations may differ materially from those projected or suggested in the forward-looking statements due to certain risks and uncertainties, including, without limitation, market acceptance of the Company's products, competition and the timely introduction of new products. Additional information concerning certain risks and uncertainties that would cause actual results to differ materially from those projected or suggested in the forward-looking statements is contained in the Company's filings with the Securities and Exchange Commission, including Bitstream'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 31, 2004. About Bitstream Bitstream Inc. (NASDAQ: BITS) is a software development company that makes communications compelling. Bitstream enables customers worldwide to render high-quality text, browse (1) To view the contents of a file or a group of files. Browser programs generally let you view data by scrolling through the documents or databases. In a database program, the browse mode often lets you edit the data. See Web browser. the Web on wireless devices, select from the largest collection of fonts online, and customize documents over 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 . Its core competencies A core competency is something that a firm can do well and that meets the following three conditions specified by Hamel and Prahalad (1990):
Bitstream and MyFonts.com are registered trademarks, and Pageflex, the Bitstream logo and ThunderHawk are trademarks, of the Company. Other technologies and brand names are used for information only and remain trademarks or registered trademarks of their respective companies.
Bitstream Inc.
Consolidated Statements of Operations
(In Thousands, Except Per Share Data)
(unaudited)
Three Months Twelve Months
Ended December 31, Ended December 31,
-------------------- --------------------
2005 2004 2005 2004
--------- --------- --------- ---------
Revenue:
Software license $ 3,947 $ 2,839 $ 13,156 $ 9,805
Services 671 484 2,497 1,827
--------- --------- --------- ---------
Total revenue 4,618 3,323 15,653 11,632
Cost of revenue:
Software license 1,182 911 4,321 3,196
Services 352 232 1,223 829
--------- --------- --------- ---------
Total cost of revenue 1,534 1,143 5,544 4,025
--------- --------- --------- ---------
Gross profit 3,084 2,180 10,109 7,607
--------- --------- --------- ---------
Operating expenses:
Marketing and selling 753 679 2,936 2,644
Research and development 1,005 980 3,929 3,914
General and
administrative 527 499 2,206 1,784
--------- --------- --------- ---------
Total operating expenses 2,285 2,158 9,071 8,342
--------- --------- --------- ---------
Operating profit (loss) 799 22 1,038 (735)
Other income:
Gain on investment in
DiamondSoft, Inc. --- --- --- 91
Other income, net 12 13 52 71
--------- --------- --------- ---------
Income (loss) before
provision for income
taxes 811 35 1,090 (573)
Provision for (benefit
from) income taxes 23 (5) 56 42
--------- --------- --------- ---------
Net income (loss) $ 788 $ 40 $ 1,034 $ (615)
========= ========= ========= =========
Basic net earnings (loss)
per share $ 0.09 $ 0.00 $ 0.12 $ (0.07)
========= ========= ========= =========
Diluted net earnings (loss)
per share $ 0.08 $ 0.00 $ 0.11 $ (0.07)
========= ========= ========= =========
Basic weighted average
shares outstanding 8,663 8,611 8,685 8,524
========= ========= ========= =========
Diluted weighted average
shares outstanding 9,514 9,073 9,620 8,524
========= ========= ========= =========
Bitstream Inc.
Consolidated Balance Sheets
(In Thousands)
(unaudited)
December 31,
---------------------
ASSETS 2005 2004
---------- ---------
Current assets:
Cash and cash equivalents $ 5,464 $ 4,405
Accounts receivable, net 1,663 962
Prepaid expenses and other current assets 341 233
--------- ---------
Total current assets 7,468 5,600
--------- ---------
Property and equipment, net 315 282
--------- ---------
Other assets:
Restricted cash 200 250
Goodwill 727 727
Intangible assets 125 174
--------- ---------
Total other assets 1,052 1,151
--------- ---------
Total assets $ 8,835 $ 7,033
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 664 $ 278
Accrued expenses 1,191 1,199
Deferred revenue 1,085 792
--------- ---------
Total current liabilities 2,940 2,269
--------- ---------
Long-term liabilities 194 200
--------- ---------
--------- ---------
Total liabilities 3,134 2,469
--------- ---------
Total stockholders' equity 5,701 4,564
--------- ---------
Total liabilities and stockholders' equity $ 8,835 $ 7,033
========= =========
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