Primix Announces Fourth Quarter Results; Revenue and Recurring Expenses Decline, Outlook and Expectations Improve.Business/Technology Editors WATERTOWN, Mass.--(BUSINESS WIRE)--March 1, 2001 Primix Solutions 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 : PMIX; "the Company") today announced financial results for the fourth quarter and year ended December 31, 2000. For the fourth quarter of 2000, revenues totaled $4,336,000. Pro-forma net loss, adjusted to exclude the write-down of intangible assets Intangible Asset An asset that is not physical in nature. Notes: Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. , amortization of intangible assets, stock compensation expense, and interest income was $3,162,000 ($0.20 per share). Net loss for the fourth quarter of 2000 was $8,526,000 ($0.55 per share.) For the year 2000, revenues were $21,413,000, compared with $11,989,000 for 1999. Net loss for the year 2000 was $15,786,000 ($1.00 per share) compared with $6,426,000 ($0.44 per share) for 1999. "As expected, our revenues in Q4 declined from Q3," said Lennart Mengwall, chairman and co-CEO of Primix. "The total value of services delivered during the fourth quarter was $5,746,000, representing a 15 percent sequential decline compared to $6,726,000 for the third quarter of 2000. This decline was compounded by our concern in Q4 over the credit-worthiness of one of our significant customers, for which we have deferred the recognition of $1.4 million, resulting in net revenues of $4,336,000. This revenue will remain deferred until such time as it is collected." "To further clarify the current state of our business, I'd like to shed some light on Q1," continued Mengwall. "We have very good visibility to revenue of $7.0 - $7.5 million in the current quarter. Although it is not evident from our Q4 financial results, we reduced our expense run rate by approximately $1.3 million in Q4, the benefit of which will be visible in Q1. As a result, we expect to drive gross margins to the 42-45 percent range, and EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become losses to below $1 million in the current quarter. In Q2 we expect 10-15 percent sequential top line growth, which will bring EBITDA losses to between $500,000 and zero." "Sequential changes in our key operating metrics metrics Managed care A popular term for standards by which the quality of a product, service, or outcome of a particular form of Pt management is evaluated. See TQM. during Q4 were mixed," said Kevin Azzouz, co-CEO of Primix. "Revenue per billable head totaled $141,153, down 14 percent from $164,049 in Q3. Our Q4 utilization rate was 52 percent, down 10 percent from 62 percent in Q3. The average hourly bill rate across our U.S. and Scandinavian businesses was $131, up marginally from $127 in Q3, though it's notable that bill rates in our North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. business rose 15 percent to $175 per hour. Headcount totaled 262 at the end of Q4 versus 243 at the end of Q3, reflecting the addition of 41 employees through the acquisition of 21st.dk in Denmark and net headcount reductions elsewhere in the Company totaling 22 people. Our billable to non-billable ratio was 73 percent by the end of Q4." "On the revenue front, we won several important new customers in Q4," said Michael Troiano, president of Primix, "Including a $4 billion global provider of informed mail and messaging management systems and a $3 billion IT media, research and exposition company. Despite the difficult market conditions that characterized char·ac·ter·ize tr.v. character·ized, character·iz·ing, character·iz·es 1. To describe the qualities or peculiarities of: characterized the warden as ruthless. 2. the second half of 2000, our business development teams closed million-dollar or larger engagements with a total of five `Global 1000' scale companies between August and December. Committed revenue from these accounts for 2001 now exceeds $6 million, and these relationships have excellent upside potential Upside potential The amount by which analysts or investors expect the price of a security may increase. upside potential The potential price or gain that may be expected in a security or in a security average, generally stated as the dollar ." Detail of Certain Charges Affecting Q4 "The Company recorded certain charges in the quarter totaling approximately $4.3 million," said David Chapman, CFO See Chief Financial Officer. of Primix. "These charges principally relate to the write-down of intangible assets associated with the Advis and Black Bean black bean see castanospermum australe, erythrophleumchlorostachys. acquisitions, 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 one-time expenses related to the consolidation of office space and relocation RELOCATION, Scotch law, contracts. To let again to renew a lease, is called a relocation. 2. When a tenant holds over after the expiration of his lease, with the consent of his landlord, this will amount to a relocation. of corporate headquarters." "At the end of Q4 we had approximately $5 million in total working capital, which we believe to be sufficient to cover our short-term capital requirements Capital requirements Financing required for the operation of a business, composed of long-term and working capital plus fixed assets. given our current operating expectations," said Mr. Chapman. "We are now working to raise additional funds to maintain our flexibility with regard to both organic growth and potential future acquisitions." About Primix Primix is a professional services (job) professional services - A department of a supplier providing consultancy and programming manpower for the supplier's products. firm dedicated to helping clients improve their business results through the application of Internet, wireless and broadband technology broadband technology Telecommunications devices, lines, or technologies that allow communication over a wide band of frequencies, and especially over a range of frequencies divided into multiple independent channels for the simultaneous transmission of different signals. . The Company brings together strategic, technical, design and branding professionals to build business-to-business and business-to-consumer solutions for clients including A.T. Cross, Bose Corporation The Bose Corporation is a privately-held American company based in Framingham, Massachusetts that specializes in audio equipment[2][3] and holds the philosophy of supporting its technological development through research (thus the company motto). , Citibank, Ericsson, Greenfield Greenfield, town (1990 pop. 18,666), seat of Franklin co., NW Mass., at the confluence of the Deerfield and Green rivers, near their junction with the Connecticut; settled 1686, set off from Deerfield and inc. 1753. Online, Kemper Insurance, Lucent Technologies, Pergo, Rockwell Collins Rockwell Collins, Inc. (NYSE: COL) is a large United States-based international company headquartered in Cedar Rapids, Iowa, primarily providing aviation and information technology systems, solutions, and services to governmental agencies and aircraft manufacturers. , and Waters Corporation  This article or section is written like an .Please help [ rewrite this article] from a neutral point of view. Mark blatant advertising for , using . . Primix is headquartered just outside Boston, Massachusetts “Boston” redirects here. For other uses, see Boston (disambiguation). Boston is the capital and most populous city of Massachusetts.[3] The largest city in New England, Boston is considered the unofficial economic and cultural center of the entire New , and operates regional offices in 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 , Sweden and Denmark. Practice areas within the firm include knowledge management, supply chain management, customer relationship management, corporate new ventures and mobile, with particular focus on vertical markets including Manufacturing & Distribution, Financial Services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. , Consulting, High Technology, Retail/Consumer, and Pharmaceuticals. Additional information about the Company, its approach, clients and service offerings may be found at http://www.primix.com. You may also e-mail info@primix.com or call 617-923-6500. Statements made in this press release, other than those concerning historical information, should be considered forward-looking and subject to various risks and uncertainties. Such 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. are made based on management's belief as well as assumptions made by, and information currently available to, management pursuant to the 'safe harbor' 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. Primix Solutions' actual results may differ materially from the results anticipated in these forward-looking statements as a result of a variety of factors, including the ability of the company to successfully manage the delivery of its service offerings, the Company's ability to satisfactorily serve its clients, the Company's ability to retain key members of its staff and its management team, the Company's ability to implement and utilize its IS infrastructure, the Company's ability to attract and retain new customer relationships, and those factors identified in Primix Solutions' 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 fiscal year ended December 31, 1999, filed with the Securities and Exchange Commission.
Primix Solutions Inc.
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
Unaudited
Three Months Ended Year Ended
December 31, December 31,
2000 1999 2000 1999
Professional
services
revenues $ 4,336 $ 3,796 $ 21,413 $ 11,989
Operating
expenses:
Professional
services 4,106 2,916 15,013 9,406
Sales &
marketing 1,261 1,054 6,071 3,442
General &
administrative 3,036 1,868 11,039 6,309
Research and
development -- 131 -- 131
Amortization
of intangible
assets 4,480 73 5,116 241
Stock
compensation 75 -- 175 --
Total
operating
expenses 12,958 6,042 37,414 19,529
Operating
loss (8,622) (2,246) (16,001) (7,540)
Interest
income, net 96 272 709 1,117
Net loss $ (8,526) $ (1,974) $(15,292) $ (6,423)
Basic and diluted
net loss per common
share $ (0.55) $ (0.13) $ (1.00) $ (0.44)
Shares used in
computing net loss
per common share 15,569 14,636 15,242 14,626
Primix Solutions Inc
Condensed Consolidated Balance Sheet
(in thousands, except per share data)
December December
31, 31,
1999 2000
Assets
Current assets:
Cash and cash equivalents $ 5,685 $ 4,813
Marketable securities 12,855 --
Accounts receivable, net 3,552 4,250
Prepaid expenses and other current assets 501 663
Note receivable from related party - current
portion 150 870
Total current assets 22,743 10,596
Property and equipment, net 456 4,462
Other assets:
Intangible assets, net 3,812 5,371
Other assets -- 393
Notes receivable from related parties 325 500
Total other assets
4,137 6,264
Total assets $ 27,336 $ 21,322
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $ 967 $ 1,229
Current portion of capital lease obligation -- 60
Accrued expenses 1,916 3,969
Note payable to related party -- 344
Total current liabilities 2,883 5,602
Capital lease obligation, net of current portion -- 126
Total liabilities 2,883 5,728
Stockholders' equity:
Common stock 15 18
Treasury stock (1,296) --
Unearned compensation -- (1,507)
Cumulative translation adjustment -- (87)
Additional paid-in capital 60,219 66,947
Accumulated deficit (34,485) (49,777)
Total stockholders' equity 24,453 15,594
Total liabilities and stockholders' equity $ 27,336 $ 21,322
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