Daleen Reports Fourth Quarter and Year End 2001 Operating Results.Business Editors/Technology Writers BOCA RATON Boca Raton (bō`kə rətōn`), city (1990 pop. 61,492), Palm Beach co., SE Fla., on the Atlantic; inc. 1925. Boca Raton is a popular resort and retirement community that experienced significant industrial development in the 1970s and 80s. , Fla.--(BUSINESS WIRE)--Feb. 1, 2002 Daleen Technologies Inc. (Nasdaq:DALN), a global provider of high performance billing and customer care software solutions that manage the revenue chain, today reported revenues of $1.6 million for its fourth quarter of 2001. Revenue for the year ended Dec. 31, 2001 was $12.4 million. Net loss for the quarter was $16.3 million, or $0.75 per share, compared with a $17.2 million net loss, or $0.79 per share, for the same period in 2000. Net loss for the year ended Dec. 31, 2001 was $91.0 million, or $5.47 per share, compared to a net loss for the prior year of $43.8 million, or $2.02 per share. The net loss for the fourth quarter of 2001 included goodwill amortization and 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 of $7.6 million and 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 $4.0 million. The net loss for 2001 included goodwill amortization and impairment charges of $46.6 million and restructuring charges of $11.7 million. Fourth Quarter Highlights: - Continued improvement in quarterly operating expense Operating Expense The essential things that a company must purchase in order to maintain business. Notes: For example, the payment of employees wages are an operating expense. Also known as OPEX. levels, resulting in a decrease in net loss per share from $1.68 per share in the third quarter to $0.75 in the fourth quarter, including 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). , amortization and goodwill charges of $23.4 million in the third quarter and $11.6 million in the fourth quarter - Delivered the RevChain(TM) solution to AAPT AAPT American Association of Physics Teachers AAPT Association of Asphalt Paving Technologists AAPT American Association of Philosophy Teachers AAPT American Association of Pharmacy Technicians AAPT Australian Association for Psychological Type , the third largest carrier in Australia, through an OEM (Original Equipment Manufacturer) The rebranding of equipment and selling it. The term initially referred to the company that made the products (the "original" manufacturer), but eventually became widely used to refer to the organization that buys the products and agreement with Telcordia Technologies Telcordia Technologies, formerly Bell Communications Research, Inc. or Bellcore, is a telecommunications research and development (R&D) company based in the United States and created on January 1 1984 as part of the 1982 Modification of Final Judgment that broke up Inc. - Formed a subsidiary in Australia, dedicated to business development and the support of existing customers in the Asia-Pacific region - Finalized See finalization. the lease buyouts on office facilities in Atlanta and Boca Raton, releasing the company from all financial obligations for these facilities, which is expected to reduce facility and operating costs operating costs npl → gastos mpl operacionales by approximately $800,000 per quarter - Released RevChain 5.5 and RevChain 5.6, which offer advanced support for partner settlements, dispute processing and enterprise integration using XML XML in full Extensible Markup Language. Markup language developed to be a simplified and more structural version of SGML. It incorporates features of HTML (e.g., hypertext linking), but is designed to overcome some of HTML's limitations. . "During the fourth quarter, we completed two significant financial obligations that have an immediate and direct impact on our financial position. In addition to the buyout Buyout The purchase of a company or a controlling interest of a corporation's shares. Notes: A leveraged buyout is accomplished with borrowed money or by issuing more stock. of our leases, we completed nearly all of our 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 obligations related to our restructuring efforts in 2001," said Jeanne Prayther, chief financial officer for Daleen. "The combined effect of these actions will reduce our use of cash going forward." Daleen's partner strategy continued to build momentum through the end of 2001, when Telcordia announced a license agreement with AAPT, the third largest carrier in Australia. According to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. the license agreement, AAPT will use the Telcordia Next-Generation Billing Manager powered by Daleen solution to support a full suite of data service offerings including ATM, DSL DSL in full Digital Subscriber Line Broadband digital communications connection that operates over standard copper telephone wires. It requires a DSL modem, which splits transmissions into two frequency bands: the lower frequencies for voice (ordinary , frame relay A high-speed packet switching protocol used in wide area networks (WANs). Providing a granular service of up to DS3 speed (45 Mbps), it has become popular for LAN to LAN connections across remote distances, and services are offered by most major carriers. , IP-VPN, private line and dial-up. Telcordia licensed Daleen's RevChain Select billing and customer care product as part of an OEM agreement announced in July, and offers the software as part of its Telcordia Next Generation Billing Manager platform. AAPT will offer access to the billing system to its affiliates, including its parent company, Telecom New Zealand Telecom New Zealand (NZX: TEL ASX: TEL NYSE: NZT) is a Wellington, New Zealand-based telephone company and, through its subdivision Xtra, an internet service provider. It has been run as a publicly-traded private company since 1990. . "Although 2001 was challenging for both our company and the entire industry, we are pleased to have ended the year with a significant customer win through our partnership with Telcordia," said James Daleen, chairman and chief executive officer for the company. "More importantly, the improvements made in reducing our ongoing cost of operations are a tremendous step toward our goals of becoming cash flow positive and, ultimately, achieving profitability." Daleen's key financial objectives include: increasing revenue in each of the coming quarters, reducing operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. to less than $6 million per quarter and reducing quarterly cash used to between $2 million and $4 million in the first quarter. About Daleen Daleen Technologies, Inc. is a global provider of high performance billing and customer care software solutions that manage the revenue chain for traditional and next-generation communication service providers, retailers and distributors of digital media, and technology solutions providers. Offering proven integration with leading CRM (Customer Relationship Management) An integrated information system that is used to plan, schedule and control the presales and postsales activities in an organization. and other legacy enterprise systems, Daleen's RevChain software and pure Internet Integration Architecture (IIA (1) (Information Industry Association, Washington, DC) In 1999, IIA merged with SPA (Software Publishers Association) to become the Software & Information Industry Association. See SIIA. (TM)) leverage open Internet technologies to enable providers to achieve peak operational efficiency while driving maximum revenue from their product and service offerings. The company is currently ranked No. 1 worldwide in overall customer satisfaction based on timeliness of delivery, functionality, delivery within budget, vendor support and maintenance, system flexibility and interoperability The capability of two or more hardware devices or two or more software routines to work harmoniously together. For example, in an Ethernet network, display adapters, hubs, switches and routers from different vendors must conform to the Ethernet standard and interoperate with each other. .(1) Additional information is available at http://www.daleen.com. Information with Respect to 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. . Statements in this release may be considered "forward-looking statements" within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, as amended a·mend v. a·mend·ed, a·mend·ing, a·mends v.tr. 1. To change for the better; improve: amended the earlier proposal so as to make it more comprehensive. 2. by 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. These include statements regarding the intent, belief or current expectations of the company and the assumptions on which these statements are based. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those contemplated by such forward-looking statements. Important factors currently known to management that could cause actual results to differ materially from those in forward-looking statements include the company's ability to continue as a going concern; the fact that the company has not yet achieved profitability; variance of quarterly operating results; the ability of the company to increase revenues and cash flows; low price and volatility of the company's common stock and uncertainty as to the company's ability to maintain compliance with the continued listing requirements Listing requirements Requirements, including minimum shares outstanding, market value, and income, that are laid down by an exchange for any stock to be listed for trading. of The Nasdaq Stock Market Nasdaq stock market The first electronic stock market listing over 5000 companies. The Nasdaq stock market comprises two separate markets, namely the Nasdaq National Market, which trades large, active securities and the Nasdaq Smallcap Market that trades emerging growth companies. ; competition; general market conditions; lengthy sales cycles and timing of contract awards; use of strategic relationships to implement and sell our products; the costs and success of the company's international expansion; and recent introduction of the company's RevChain product family. These factors and others are described in the company's most recent SEC filings including the most recently filed 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 the company's Quarterly Reports on Form 10-Q Form 10-Q See 10-Q. . The company undertakes no obligation to update the forward-looking statements in this news release. Daleen, IIA and RevChain are registered trademarks or trademarks of Daleen Technologies Inc. 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 other countries. All other trademarks and registered trademarks are property of their respective owners. (1) See the independent report issued by Chorleywood Consulting titled "Global Trends and Market Forecasts in Telecoms BCC (Blind Carbon Copy) The field in an e-mail header that names additional recipients for the message. It is similar to carbon copy (cc), but the names do not appear in the recipient's message. Not all e-mail systems support the bcc feature. See fcc. 2001."
Daleen Technologies, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(in thousands)
Unaudited
December 31 December 31
2001 2000
----------- -----------
Assets
Current assets:
Cash and cash equivalents $ 13,093 $ 22,268
Restricted Cash 30 931
Accounts receivable, net 2,885 13,929
Costs in excess of billings 5 2,213
Other current assets 431 904
----------- -----------
Total current assets 16,444 40,245
Property and equipment, net 2,704 10,146
Goodwill and other intangibles, net -- 44,726
Other assets 2,045 4,345
----------- -----------
Total assets $ 21,193 $ 99,462
=========== ===========
Liabilities and Stockholders' Equity
Current liabilities:
Accrued payroll and other
accrued expenses 3,733 12,731
Accounts payable 678 2,968
Billings in excess of costs 1,323 1,466
Deferred revenue 1,013 2,944
Other current liabilities -- 1,061
----------- -----------
Total current
liabilities 6,747 21,170
Long term portion of
capitalized lease -- 607
----------- -----------
Total liabilities 6,747 21,777
Minority Interest 184 184
Total stockholders' equity 14,262 77,501
----------- -----------
Total liabilities
and stockholders'
equity $ 21,193 $ 99,462
=========== ===========
Daleen Technologies, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(in thousands except per share data)
Unaudited
Three Months ended Twelve Months ended
------------------------- -------------------------
December 31 December 31 December 31 December 31
2001 2000 2001 2000
----------- ----------- ----------- -----------
Revenue:
License fees $ 372 4,645 3,565 26,886
Professional
services and
other 1,266 4,530 8,867 16,743
----------- ----------- ----------- -----------
Total
revenue 1,638 9,175 12,432 43,629
----------- ----------- ----------- -----------
Cost of revenue:
License fees 42 130 1,646 682
Professional
services and
other 970 3,646 7,302 13,878
----------- ----------- ----------- -----------
Total cost
of revenue 1,012 3,776 8,948 14,560
----------- ----------- ----------- -----------
Gross margin 626 5,399 3,484 29,069
Operating expenses:
Sales and
marketing 2,114 4,786 10,895 14,680
Research and
development 1,591 7,887 12,502 27,215
General and
administrative 2,715 10,480 25,834 33,415
Restructuring
and impairment
charges 10,710 0 46,367 0
----------- ----------- ----------- -----------
Total operating
expenses 17,130 23,153 95,598 75,310
----------- ----------- ----------- -----------
Operating loss (16,504) (17,754) (92,114) (46,241)
----------- ----------- ----------- -----------
Total interest
income and
nonoperating
income, net 175 530 1,125 2,456
----------- ----------- ----------- -----------
Net loss $(16,329) (17,224) (90,989) (43,785)
Less: preferred stock
dividends arising
from beneficial
conversion
features - - (28,512) -
----------- ----------- ----------- -----------
Net loss applicable
to common
shareholders $(16,329) (17,224) (119,501) (43,785)
=========== =========== =========== ===========
Net loss applicable
to common shareholders
per share -
basic and
diluted $ (0.75) (0.79) (5.47) (2.02)
=========== =========== =========== ===========
Weighted average
outstanding
shares -
basic and
diluted 21,875 21,778 21,836 21,671
=========== =========== =========== ===========
Adjustments to net
loss for
amortization of
goodwill and other
intangibles,
stock compensation
expense, restructuring,
preferred stock
dividends and
impairment
charges 11,598 4,225 89,097 15,957
----------- ----------- ----------- -----------
Adjusted net loss
applicable to
common
shareholders (4,731) (12,999) (30,404) (27,828)
=========== =========== =========== ===========
Adjusted net loss
applicable to
common shareholders
per share-basic
and diluted $ (0.22) (0.60) (1.39) (1.28)
=========== =========== =========== ===========
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