CrossKeys Resumes Revenue Growth in First Quarter.KANATA, Ontario--(BUSINESS WIRE)--Sept. 22, 1999-- CrossKeys Systems Corporation (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 :CKEY) (TSE See Tokyo Stock Exchange. TSE 1. See Tokyo Stock Exchange (TSE). 2. See Toronto Stock Exchange (TSE). :CKY CKY Camp Kill Yourself (band) CKY Conakry, Guinea - Conakry (Airport Code) .), a leading supplier of software for telecommunication telecommunication Communication between parties at a distance from one another. Modern telecommunication systems—capable of transmitting telephone, fax, data, radio, or television signals—can transmit large volumes of information over long distances. service providers, today announced financial results for the first quarter of its fiscal year 2000. Revenues for the quarter ended August 29, 1999 grew 47 per cent over the fourth quarter of 1999. In addition, orders for software in the quarter exceeded shipments resulting in a strengthened backlog. First quarter 2000 revenues of $7.6 million compare to $5.2 million in the fourth quarter of fiscal 1999 and $12.1 million for the first quarter of 1999. CrossKeys reported a net loss of $1.4 million for the first quarter of fiscal 2000, or a fully 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. loss per share of $(0.07) Cdn versus earnings per share of $0.10 Cdn in the first quarter a year ago, and a loss of $(0.37) Cdn per share in the fourth quarter of fiscal 1999. In U.S. dollars, fully diluted loss per share for the first quarter was $(0.05), translated at the average exchange rate for the quarter of $0.6721 as reported by the Federal Reserve Bank of New York The Bank of New York, abbrieviated to BNY, was a global financial services company that existed until its merger with the Mellon Financial Corporation on July 2, 2007.[1] The bank now continues under the new name of The Bank of New York Mellon Corporation. . "The combination of major wins and additional global channel partnerships are creating new momentum for the Company," said Ian McLaren, CrossKeys President and Chief Executive Officer. "The growth in core product revenue and the strong book-to-bill ratio Book-to-Bill Ratio The technology industry's demand-to-supply ratio for orders on a "firm's book" to number of orders filled. Notes: This ratio tells whether the company has more orders than it can deliver (if greater than 1), has the same amount of orders that it can during the first quarter are both very positive signs." Mr. McLaren added, "Our prime objective right now is growth--growth in the extent and nature of our partnerships, growth in our product set and growth in our top line revenue. In this past quarter, we announced agreements with world class players such as Nortel and Logica as well as significant deals with telcos such as BT, which are all positive endorsements of our strategy and our position in the market place. Closer to home, we are revitalizing re·vi·tal·ize tr.v. re·vi·tal·ized, re·vi·tal·iz·ing, re·vi·tal·iz·es To impart new life or vigor to: plans to revitalize inner-city neighborhoods; tried to revitalize a flagging economy. our sales and marketing force and adding engineering depth to advance our product lead over our competitors." Significant highlights of the quarter included: - Positive book-to-bill ratio, driving increased backlog. - Increase in revenues from core products of $5 million from last quarter, reflecting CrossKeys strategic decision to focus on license sales. - Fourth highest quarterly bookings in company's history, 20 per cent of which came from new customers and channels. - Improvement in Days Sales Outstanding In accountancy, Days Sales Outstanding is a company's average collection period. A low figure indicates that the company collects its outstanding receivables quickly. Typically it is looked at either quarterly or yearly (90 or 365 days). to 48 days as of August 29, 1999 compared to 78 days in the previous quarter. - Strong sales to over 20 existing customers including Bell Atlantic and Bell Canada Bell Canada Enterprises (TSX: BCE, NYSE: BCE), legally BCE Inc., is a major Canadian telecommunications company. Through its subsidiaries including Bell Canada, Bell Aliant, Northwestel, Télébec, and NorthernTel, it is the incumbent local exchange carrier for . About CrossKeys CrossKeys Systems Corporation (www.crosskeys.com) develops software that helps service providers manage the equipment and traffic on their telecom networks so they can operate more efficiently and provide better service to their customers. Through its relationships with leading systems integrators An individual or organization that builds systems from a variety of diverse components. With increasing complexity of technology, more customers want complete solutions to information problems, requiring hardware, software and networking expertise in a multivendor environment. , equipment manufacturers and other vendors, CrossKeys serves over 180 telecommunication service providers worldwide. CrossKeys has been ISO (1) See ISO speed. (2) (International Organization for Standardization, Geneva, Switzerland, www.iso.ch) An organization that sets international standards, founded in 1946. The U.S. member body is ANSI. 9001 certified See certification. since 1995. CrossKeys Systems Corporation is a public company whose common shares are listed for trading on Nasdaq (CKEY) in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. and on The Toronto Stock Exchange Toronto Stock Exchange (TSE) Canada's largest stock exchange, trading approximately 1,200 company stocks and 33 options. (CKY) in Canada. CrossKeys and the CrossKeys logo are registered trade marks TRADE MARKS. Signs, writings or tickets put upon manufactured goods, to distinguish them from others. 2. It seems at one time to have been thought that no man acquired a right in a particular mark or stamp. 2 Atk. 484. of CrossKeys Systems Corporation. All other trade marks are the property of their respective holders and are acknowledged by CrossKeys Systems Corporation. This announcement 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. as defined by the US 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 as statements related to the industry motivators, market and partnership opportunities. The Company cautions that these statements are based on current expectations that are subject to risks and uncertainties. Actual results may differ due to factors such as customer demand, product shipping schedules, product mix, competitive products and pricing pressures, and changes in the service, network and element management software applications market specifically. Additional information identifying risks and uncertainties is contained in the Company's filings with the Ontario Securities Commission The Ontario Securities Commission (OSC) is a regulatory agency which administers and enforces securities legislation in the Canadian province of Ontario. The OSC is an Ontario Crown corporation which reports to the Ontario legislature through the Minister of Finance. and the Securities and Exchange Commission. Summary of financials follows:
CROSSKEYS SYSTEMS CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(Canadian dollars, amounts in thousands, except per share
data, US GAAP)
Fiscal quarters ended
August 29, August 2,
1999 1998
----------- -----------
(unaudited) (unaudited)
Product revenue $ 5,965 $ 9,885
Service revenue 1,590 2,195
----------- -----------
Total revenue 7,555 12,080
----------- -----------
Product costs 1,386 2,428
Service costs 780 1,013
----------- -----------
Total cost of sales 2,166 3,441
----------- -----------
Gross margin 5,389 8,639
----------- -----------
Expenses
Research and development 2,617 1,996
Selling, general and administration 4,709 4,657
----------- -----------
Total expenses 7,326 6,653
----------- -----------
Income (loss) from operations (1,937) 1,986
Interest income 586 647
----------- -----------
Income (loss) before income taxes (1,351) 2,633
Income tax provision - (723)
----------- -----------
Net income (loss) (1,351) 1,910
----------- -----------
----------- -----------
Earnings per share
Basic ($ 0.07) $ 0.10
Diluted ($ 0.07) $ 0.10
Weighted average number of common
shares
Basic 18,541 18,306
Diluted 18,541 19,205
CROSSKEYS SYSTEMS CORPORATION
CONSOLIDATED CONDENSED BALANCE SHEETS
(Canadian dollars, amounts in thousands, except per share
data, US GAAP)
August 29, May 31,
1999 1999
----------- -----------
(unaudited)
ASSETS
Cash and short-term investments $ 53,096 $ 53,426
Accounts receivable 4,060 5,463
Unbilled receivables 3,535 4,438
Fixed assets 5,348 5,693
Other assets 8,576 8,124
----------- -----------
$ 74,615 $ 77,144
----------- -----------
----------- -----------
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable and accrued
liabilities $ 5,313 $ 5,348
Deferred revenue 663 1,320
----------- -----------
5,976 6,668
----------- -----------
Shareholders' equity 68,639 70,476
----------- -----------
$ 74,615 $ 77,144
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