BroadVision Announces Second Quarter 2005 Results.REDWOOD CITY Redwood City, city (1990 pop. 66,072), seat of San Mateo co., W Calif., on San Francisco Bay; inc. 1868. Manufactures include commmunications, electrical, electronic, and medical equipment. , Calif. -- BroadVision A family of e-business applications from BroadVision, Inc., Redwood City, CA (www.broadvision.com) that provide the tools to develop a complete, commercial Web site. The suite of integrated and self-service applications includes BroadVision Process; Commerce; Content; and Portal, all of , Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :BVSN BVSN Broadvision, Inc. (stock abbreviation, AMEX) ), a global provider of web self-service solutions, today reported financial results for its second quarter ended June June: see month. 30, 2005. Revenue for the quarter was $15.5 million, compared with revenue of $16.4 million for the first quarter ended March 31, 2005 and $20.1 million for the second quarter of 2004. The Company's guidance for the quarter was to generate revenue of $16.0 to $18.0 million. License revenue for the quarter totaled $3.4 million versus $4.4 million in the prior quarter and $7.1 million in the comparable quarter of 2004. In the second quarter, BroadVision posted a net loss on a generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting (GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). ) basis of $2.9 million, or $0.08 per share, as compared with GAAP net income of $2.9 million, or $0.07 per 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. share, for the first quarter of 2005, and a GAAP net loss of $1.5 million, or $0.04 per share, in the second quarter of 2004. The GAAP loss in the most recent quarter included a 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. of $309,000. The restructuring charge includes $665,000 of severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when costs and various facility charges, partially offset by a gain on the revaluation Revaluation A calculated adjustment to a country's official exchange rate relative to a chosen baseline. The baseline can be anything from wage rates to the price of gold to a foreign currency. In a fixed exchange rate regime, only a decision by a country's government (i.e. of common stock warrants. 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 for the second quarter of 2005 was $3.3 million, or $0.10 per share, compared with a pro forma net loss of $1.5 million, or $0.05 per share, in the first quarter of 2005 and a pro forma net loss of $813,000, or $0.02 per share, in the second quarter of 2004. These pro forma results exclude restructuring charges and credits, gains and losses from the revaluation of common stock warrants, and credits from the reversal of income tax accruals Accruals Accounts on a balance sheet that represent liabilities and non-cash-based assets used in accrual-based accounting. These accounts include, among many others, accounts payable, accounts receivable, goodwill, future tax liability and future interest expense. . A reconciliation of pro forma results to GAAP results is provided in the financial information attached to this press release. The Company believes its pro forma results provide useful information because they reflect the Company's financial performance excluding certain charges, credits, gains and losses that the Company believes are not indicative of its ongoing operations. "While we were disappointed in our license transaction execution, several existing customers recommitted to our platform in the second quarter," said Dr. Pehong Chen, BroadVision 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. . "As previously announced, we recently implemented a headcount head count or head·count n. 1. The act of counting people in a particular group. 2. The number of people counted in this way. Noun 1. reduction of over 20%. Although we believe this was an aggressive step towards costs controls, we cannot be certain that it will be sufficient to meet the Company's near-term near-term adj. Of, for, or involving a short period of time in the near future. liquidity challenges. We are also announcing today a definitive agreement for the acquisition of all of the Company's outstanding shares by Vector Capital, and we look forward to working closely with our shareholders through the approval and close of the transaction." Definitive Agreement Announcement As also announced today, the Company has entered into a definitive agreement to be acquired by a newly-formed portfolio company of Vector Capital, a San Francisco-based private equity firm. Additional information about the proposed acquisition, as well as further information about the Company's financial performance and condition, is included in a separate press release issued by the Company today. A vote on the proposed transaction will be taken at an upcoming special meeting of stockholders on a date to be announced To be announced (TBA) A contract for the purchase or sale of an MBS to be delivered at an agreed-upon future date but does not include a specified pool number and number of pools or precise amount to be delivered. . Conference Call BroadVision will hold a conference call to discuss this press release and the acquisition press release at 12:30 p.m. Eastern time today, July July: see month. 26, 2005. The call, hosted by Dr. Pehong Chen, can be accessed live by dialing (US) 800-591-6942 or (international) 617-614-4909 (pass code 39034411) or by visiting the investor relations Investor relations The process by which the corporation communicates with its investors. section of the Company's website at www.broadvision.com/ir. Information Concerning 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. Information in this release that involves expectations, beliefs, hopes, plans, intentions or strategies regarding the future are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, which forward-looking statements involve risk and uncertainties. All forward-looking statements included in this release, including, but not limited to, our ability to finalize fi·nal·ize tr.v. fi·nal·ized, fi·nal·iz·ing, fi·nal·iz·es To put into final form; complete or conclude: "They have jointly agreed ... revenue transactions in future quarters and our ability to generate revenue growth, earnings and adequate cash flows in 2005, are based upon information available to BroadVision as of the date of this release, and BroadVision assumes no obligation to update or correct any such forward-looking statements. These statements are not guarantees of future performance and actual results could differ materially from BroadVision's current expectations. Factors which could cause or contribute to such differences include, but are not limited to: lack of market acceptance of BroadVision's existing and new products or services; BroadVision's inability to continue to develop competitive new products and services on a timely basis; introduction of new products or services by competitors; general economic conditions and BroadVision's inability to attract and retain qualified employees. These and other factors and risks associated with BroadVision's business are discussed in its most recent 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. and in BroadVision's quarterly reports on Form 10-Q Form 10-Q See 10-Q. as filed with the Securities and Exchange Commission. About BroadVision BroadVision is a global provider of web self-service solutions. Our agile commerce and portal applications enable customers to quickly create and adapt online processes to keep pace with changing business requirements. Over 1,000 organizations -- including Circuit City, Yankee Yankee, term used by Americans generally in reference to a native of New England and by non-Americans, especially the British, in reference to an American of any section. Candle, Vodafone Vodafone Group Plc is a mobile network operator headquartered in Newbury, Berkshire, England, UK. It is the largest mobile telecommunications network company in the world by turnover and has a market value of about £84.7 billion (July 2007). , Cardinal Health <includeonly></includeonly> Cardinal Health (NYSE: CAH) is a premier, global healthcare company dedicated to making healthcare safer and more productive. Overview Headquartered in Dublin, Ohio, Cardinal Health, Inc. , Hewlett-Packard See HP. Hewlett-Packard - (HP) Hewlett-Packard designs, manufactures and services electronic products and systems for measurement, computation and communications. The company's products and services are used in industry, business, engineering, science, medicine and , Toyota Toyota (toi-ō`tə, Jap. tōyō`tä), city (1990 pop. 332,336), Aichi prefecture, central Honshu, Japan. It is a major industrial center dominated by the Toyota Motor Company, which produces passenger vehicles and auto parts there. , Japan Airlines and the U.S. Air Force -- serving nearly 75 million registered users, rely on BroadVision's open solutions to power and personalize 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. their mission-critical web initiatives For more information about BroadVision, Inc., call 650-542-5100, email info@broadvision.com or visit www.broadvision.com. Additional Information About the Proposed Transaction and Where You Can Find It In connection with the proposed transaction, BroadVision intends to file a proxy statement Proxy Statement A document containing the information that a company is required by the SEC to provide to shareholders so they can make informed decisions about matters that will be brought up at an annual stockholder meeting. and other relevant materials with the SEC. BEFORE MAKING ANY VOTING DECISION WITH RESPECT TO THE PROPOSED TRANSACTION, STOCKHOLDERS OF BROADVISION ARE URGED TO READ THE PROXY STATEMENT AND OTHER RELEVANT MATERIALS BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION. The proxy statement and other relevant materials, and any other documents filed by BroadVision with the SEC, may be obtained free of charge at the SEC's website at www.sec.gov See .gov and GovNet. (networking) gov - The top-level domain for US government bodies. . In addition, stockholders of BroadVision may obtain free copies of the documents filed with the SEC by contacting BroadVision Investor Relations at 650-261-5100 or BroadVision, Inc., 585 Broadway Broadway, famous thoroughfare in New York City. It extends from Bowling Green near the foot of Manhattan island N to 262d St. in the Bronx. Throughout its length Broadway is chiefly a commercial street. , Redwood City, CA 94063. You may also read and copy any reports, statements and other information filed by BroadVision with the SEC at the SEC public reference room at 100 F Street, NE, Room 1580, Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 or visit the SEC's website for further information on its public reference room. BroadVision and its executive officers and directors may be deemed to be participants in the solicitation solicitation In criminal law, the act of asking, inducing, or directing someone to commit a crime. The person soliciting another becomes an accomplice to the crime. The term also refers to the act of obtaining bribes, as well as to the crime of a prostitute who offers sexual of proxies from BroadVision stockholders in favor of upon the side of; favorable to; for the advantage of. See also: favor the proposed transaction. Certain executive officers and directors of BroadVision have interests in the transaction that may differ from the interests of stockholders generally, including benefits conferred con·fer v. con·ferred, con·fer·ring, con·fers v.tr. 1. To bestow (an honor, for example): conferred a medal on the hero; conferred an honorary degree on her. under retention, severance and change in control arrangements, ownership interests in BroadVision's parent company after the transaction and continuation of director and officer insurance and indemnification Indemnification Used in insurance policy agreements as to compensation for damage or loss. In the context of corporate governance, Director Indemnification uses the bylaws and/or charter to indemnify officers and directors from certain legal expenses and judgements resulting from . These interests will be described in the proxy statement when it becomes available.
BROADVISION, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except per share amounts)
Jun. 30, Dec. 31,
2005 2004
----------- ---------
ASSETS (Unaudited)
Current assets:
Cash and cash equivalents $ 26,839 $ 41,851
Accounts receivable, less allowance for
doubtful accounts and reserves of $1,308 and
$1,409 as of June 30, 2005 and December 31,
2004, respectively 12,815 14,370
Restricted cash and investments, current portion 1,911 21,933
Prepaids and other 2,168 2,232
--------- ---------
Total current assets 43,733 80,386
Property and equipment, net 2,940 3,566
Restricted cash and investments, net of current
portion 1,997 2,323
Goodwill 53,421 53,421
Other intangibles, net 3,013 3,013
Other assets 1,279 1,944
--------- ---------
Total assets $106,383 $144,653
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of bank borrowings $ 15,454 $ 20,637
Current portion of long-term debt 12,472 4,929
Accounts payable 5,461 7,470
Accrued expenses 15,793 40,745
Warrant liability 1,385 4,899
Unearned revenue and deferred maintenance 17,701 19,842
--------- ---------
Total current liabilities 68,266 98,522
Long-term debt, net of current portion -- 7,054
Bank borrowings, net of current portion 162 389
Other noncurrent liabilities 6,995 8,278
--------- ---------
Total liabilities 75,423 114,243
--------- ---------
Commitments and contingencies
Stockholders' equity 30,960 30,410
--------- ---------
Total liabilities and stockholders' equity $106,383 $144,653
========= =========
BROADVISION, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(Unaudited)
Three Months Ended Six Months Ended
Jun. Mar. Jun. Jun. Jun.
30, 31, 30, 30, 30,
2005 2005 2004 2005 2004
------- ------- ------- ------- -------
Revenues:
Software licenses $ 3,391 $ 4,416 $ 7,097 $ 7,807 $14,937
Services 12,123 11,951 13,031 24,074 26,080
------- ------- ------- ------- -------
Total revenues 15,514 16,367 20,128 31,881 41,017
Cost of revenues:
Cost of software licenses (186) (57) 313 (243) 891
Cost of services 5,614 5,980 6,302 11,594 12,579
------- ------- ------- ------- -------
Total cost of revenues 5,428 5,923 6,615 11,351 13,470
------- ------- ------- ------- -------
Gross profit 10,086 10,444 13,513 20,530 27,547
Operating expenses:
Research and development 3,954 4,287 4,509 8,241 9,397
Sales and marketing 5,061 5,811 7,480 10,872 14,346
General and administrative 2,829 2,535 2,400 5,364 4,817
Restructuring (credit)
charge 309 (704) 679 (395) 1,249
------- ------- ------- ------- -------
Total operating expenses 12,153 11,929 15,068 24,082 29,809
------- ------- ------- ------- -------
Operating loss (2,067) (1,485) (1,555) (3,552) (2,262)
Interest and other income
(expense), net (777) 2,371 57 1,594 33
------- ------- ------- ------- -------
Income (loss) before
(provision)/benefit
for income taxes (2,844) 886 (1,498) (1,958) (2,229)
(Provision)/benefit for
income taxes (70) 2,032 6 1,962 (130)
------- ------- ------- ------- -------
Net income (loss) $(2,914)$ 2,918 $(1,492) $ 4 $(2,359)
======= ======= ======= ======= =======
Basic income (loss) per
share $ (0.08)$ 0.09 $ (0.04) $ 0.00 $ (0.07)
======= ======= ======= ======= =======
Diluted income (loss) per
share $ (0.08)$ 0.07 $ (0.04) $ 0.00 $ (0.07)
======= ======= ======= ======= =======
Shares used in computing
basic income (loss) per
share 34,320 33,971 33,476 34,077 33,392
======= ======= ======= ======= =======
Shares used in computing
diluted income (loss) per
share 34,320 39,968 33,476 34,163 33,392
======= ======= ======= ======= =======
PRO FORMA FINANCIAL
INFORMATION(a):
Net loss $(3,337)$(1,547)$ (813) $(4,884)$(1,110)
======= ======= ======= ======= =======
Basic loss per share $ (0.10)$ (0.05)$ (0.02) $ (0.14)$ (0.03)
======= ======= ======= ======= =======
Diluted loss per share $ (0.10)$ (0.05)$ (0.02) $ (0.14)$ (0.03)
======= ======= ======= ======= =======
(a) Pro forma net loss and the related per share amounts exclude: 1)
restructuring charges and credits, 2) gains and losses from the
revaluation of common stock warrants and 3) credits from the reversal
of income tax accruals. Pro forma net loss and pro forma cost of
revenues and operating expenses reconcile to the comparable amounts
under generally accepted accounting principles as follows (unaudited,
in thousands):
Three Months Ended Six Months Ended
Jun. Mar. Jun. Jun. Jun.
30, 31, 30, 30, 30,
2005 2005 2004 2005 2004
------------------------ ----------------
Net income (loss), generally
accepted accounting
principles $(2,914)$ 2,918 $(1,492) $ 4 $(2,359)
Pro forma adjustments:
Restructuring charges
(credits) 309 (704) 679 (395) 1,249
Revaluation of warrant (732) (1,764) -- (2,496) --
Reversal of income tax
accruals -- (1,997) -- (1,997) --
------- ------- ------- ------- -------
Pro forma net loss $(3,337)$(1,547)$ (813) $(4,884)$(1,110)
======= ======= ======= ======= =======
Cost of revenues and
operating expenses,
generally accepted
accounting principles $17,581 $17,852 $21,983 $35,433 $43,279
Pro forma adjustments:
Restructuring (charges)
credits (309) 704 (679) 395 (1,249)
------- ------- ------- ------- -------
Pro forma cost of revenues
and operating expenses $17,272 $18,556 $21,304 $35,828 $42,030
======= ======= ======= ======= =======
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