Synavant Reports 2001 Second-Quarter Results.Business Editors & Technology Writers ATLANTA--(BUSINESS WIRE)--Aug. 1, 2001 Revenue 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 Performance At High End Of Guidance Range; Positive EBITDA Expected in 2001 Second Half SYNAVANT Inc. (Nasdaq:SNVT SNVT Standard Network Variable Types SNVT Short No Voltage Tester ), the global pioneer of Pharmaceutical Relationship Management (PRM PRM Partner Relationship Management PRM Parameter PRM Bureau of Population, Refugees and Migration (US State Department) PRM Partidul Romania Mare (Romania Mare Party) PRM Professional Risk Manager ) solutions for the biopharmaceutical and healthcare industries, today reported 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 revenue of $46.7 million, and pro forma earnings pro forma earnings Income not necessarily calculated in accordance with generally accepted accounting principles. For example, a company might report pro forma earnings that exclude depreciation expense and nonrecurring expenses such as restructuring costs. before interest, taxes, depreciation and amortization (EBITDA) of minus $1.0 million for the quarter ended June June: see month. 30, 2001. Both financial measures are at the high end of previously issued guidance ranges and reflect a trend of quarterly improvement in the company's operating performance. "During SYNAVANT's first 11 months as an independent company, we have made progress toward profitability, demonstrated the value of our unique solutions and service offerings, and established our effectiveness as a strategic business partner with biopharmaceutical and healthcare companies worldwide," said Wayne Wayne, city (1990 pop. 19,899), Wayne co., SE Mich., a suburb of Detroit, on the Lower Rouge River; inc. as a village 1869, and with surrounding areas as a city 1960. It has automobile and aircraft industries and other varied manufactures. P. Yetter, SYNAVANT's chairman and chief executive officer. "Customer interest in our strategic solutions continues to grow, and we are seeing significant opportunities for new business. Although we're we're Contraction of we are. we're we are experiencing some lengthening lengthening (lengkˑ·the·ning), n the use of various massage or muscle energy techniques to relax and stretch muscle and connective tissue. of timelines This article or section contains self-references. For other uses of "Timeline", see Timeline (disambiguation). The following is an index of timelines found on Wikipedia. for major contract awards due to the current economic climate and the business environment of our pharmaceutical industry customers, we remain optimistic op·ti·mist n. 1. One who usually expects a favorable outcome. 2. A believer in philosophical optimism. op that SYNAVANT will be an active solutions partner when these new business decisions are made." Second-Quarter Pro Forma Results Pro forma results for the 2001 second quarter (Table 1) exclude spin-related costs of $0.3 million and include certain adjustments to reflect SYNAVANT as if it were an independent company during the second quarter of 2000. Pro forma revenue totaled $46.7 million, a 2 percent decline from the 2000 second quarter, and an increase of 6 percent from the 2001 first quarter. Pro forma EBITDA was minus $1.0 million, reflecting improvement compared with minus $1.6 million a year earlier and minus $1.8 million for the 2001 first quarter. Components of depreciation and amortization for the quarter were: acquired software and goodwill amortization of $4.0 million and other depreciation of $1.4 million. In addition, FAS 86 software amortization of $0.5 million for the quarter is reflected in operating costs operating costs npl → gastos mpl operacionales . A pro forma net loss of $6.0 million, or $0.40 per share, was reported for the 2001 second quarter, compared with a pro forma net loss of $2.8 million, or $0.19 per share, a year ago, due to a change in the effective tax rate. Six-Months Pro Forma Results Pro forma results for the first six months of 2001 (Table 2) exclude spin-related costs of $0.6 million and include certain adjustments to reflect SYNAVANT as if it were an independent company during the first half of 2000. Pro forma revenue totaled $90.8 million, 3 percent lower than the 2000 first six months, and pro forma EBITDA was minus $2.9 million, compared with minus $1.3 million in the year-earlier period. A pro forma net loss of $15.5 million, or $1.04 per share, was posted in the 2001 first six months, compared with a pro forma net loss of $12.4 million, or $0.83 per share, a year ago. "SYNAVANT's EBITDA performance in the 2001 second quarter reflected the impact of customer sales force expansions in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. , as well as the result of controlling costs," said Craig Craig , Edward Gordon 1872-1966. British theatrical producer, director, and designer whose innovative productions and simplified stage designs influenced modern theater. Kussman, SYNAVANT's executive vice president and chief financial officer. Constant-Dollar Results The strengthening dollar, particularly against European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. currencies, adversely affected SYNAVANT's reported revenue by $1.6 million in the 2001 second quarter. On a constant-dollar, constant-portfolio basis, which reflects the divestiture The breakup of AT&T. By federal court order, AT&T divested itself on January 1, 1984 of its 23 operating companies, which became known as the Regional Bell Operating Companies (RBOCs). of EMRON EMRON Electro Magnetic Radiation Optimum Neutralizer (RADIAX) in the fourth quarter of 2000 and the impact of foreign currency exchange, 2001 second-quarter pro forma revenue rose 5 percent above the year-earlier quarter. In the 2001 first six months, constant-dollar, constant-portfolio pro forma revenue was 3 percent higher than in the 2000 first half. Balance Sheet Highlights At June 30, 2001, SYNAVANT's cash and cash equivalents totaled $9.1 million. Net cash flow during the 2001 second quarter totaled minus $4.8 million, down from minus $5.9 million in the first quarter. Financial Outlook "Because of delays in client purchasing decisions, some revenue sources projected for the second half of 2001 will instead be recognized in 2002," said Kussman. "We currently expect revenue to be in the $40 million to $44 million range in the 2001 third quarter, and full-year revenue growth of 0-to-6 percent on a constant-dollar, constant-portfolio basis in 2001. "With continued cost containment cost containment, n the features of a dental benefits program or of the administration of the program designed to reduce or eliminate certain charges to the plan. and the absence of certain costs incurred in the first half of 2001, we expect pro forma EBITDA to be in the $0.5 million to minus $1.5 million range in the 2001 third quarter, and between $3.5 million and minus $1.5 million for the full year." Operating Highlights During the second quarter, SYNAVANT signed a contract with Nippon Nippon (nĭp`ŏn, nĭpŏn`), name for Japan, derived from Dai Nippon, meaning Great Japan. The expression comes from the Chinese ideograph for the place where the sun comes from, or Land of the Rising Sun. Shinyaku KK, a leading Japanese Japanese (jăp'ənēz`), language of uncertain origin that is spoken by more than 125 million people, most of whom live in Japan. There are also many speakers of Japanese in the Ryukyu Islands, Korea, Taiwan, parts of the United States, and biopharmaceutical company to implement Siebel For the tech company, see . Siebel, originally Flugzeugbau Halle, was a German aircraft manufacturer in Halle an der Saale. Siebel aircraft included:
adj. Detailed; thorough: an in-depth study. in-depth Adjective detailed or thorough: an in-depth analysis knowledge of the Japanese pharmaceutical industry. Work is already underway on this new contract, with roll-out scheduled in October October: see month. 2001. In November November: see month. 2000, SYNAVANT announced a major relationship with Aventis Aventis Is a pharmaceutical and lab assay testing company. It was formed in 1999 when Rhône-Poulenc S.A. merged with Hoechst AG. The merged company was based in Strasbourg, France. Sanofi-Aventis was formed in 2004 when Sanofi-Synthélabo purchased Aventis. Pharma SPA Spa, commune (1991 pop. 10,140), Liège prov., E Belgium, in the Ardennes. Its therapeutic mineral springs and baths, frequented since the 16th cent., made it an internationally fashionable watering place. in Italy Italy (ĭt`əlē), Ital. Italia, officially Italian Republic, republic (2005 est. pop. 58,103,000), 116,303 sq mi (301,225 sq km), S Europe. for the delivery, support and full facilities management The management of a user's computer installation by an outside organization. All operations including systems, programming and the datacenter can be performed by the facilities management organization on the user's premises. of a sophisticated, total Pharmaceutical Relationship Management solution to approximately 900 users, based on Siebel's ePharma technology. SYNAVANT recently completed this largest-ever single country ePharma implementation successfully and on-time. In the first quarter of 2001 SYNAVANT reported the successful completion of its ePharma implementation for GlaxoSmithKline GlaxoSmithKline plc (LSE: GSK NYSE: GSK) is a British based pharmaceutical, biological, and healthcare company. GSK is a research-based company with a wide portfolio of pharmaceutical products covering anti-infectives, central nervous system (CNS), respiratory, in Austria Austria (ô`strēə), Ger. Österreich [eastern march], officially Republic of Austria, federal republic (2005 est. pop. 8,185,000), 32,374 sq mi (83,849 sq km), central Europe. . "We completed our first two major ePharma implementations with the highest level of customer satisfaction," said Yetter. "Our ratings for product effectiveness, consulting, implementation, technical support and training have been excellent, and reflect the company's pharmaceutical expertise and the outstanding capabilities of our employees." Further successes in the 2001 second quarter include contract wins in Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). for the two new SYNAVANT services announced in February February: see month. this
year: Influence Network Marketing(TM) (INM INM Instituto Nacional de Migración (México)INM Integrated Noise Model (FAA) INM Institute of Naval Medicine (Royal Navy) INM Integrated Network Management ) and Synmetrics(SM). "Although revenue generated from these current INM and Synmetrics(SM) projects is not yet significant, they reflect the value of SYNAVANT's integrated offerings to major pharmaceutical clients," Yetter said. "Interest in these unique services is high, and we expect to receive additional INM and Synmetrics(SM) contracts this year." During the quarter, SYNAVANT won several new contracts, contract renewals and expansions to provide existing PRM solutions and Interactive Marketing services to clients across its three key geographies: North America, Europe and Asia Pacific. One contract extension in the U.S. will provide minimum revenue of $5.0 million during the next 18 months. Operating Outlook Building on the first phase development of SYNAVANT Synpharma(SM), announced in the first quarter 2001, SYNAVANT has recently demonstrated a SYNAVANT Synpharma(SM) solution totally customized in Kanji (human language, character) kanji - /kahn'jee/ (From the Japanese "kan" - the Chinese Han dynasty, and "ji" - glyph or letter of the alphabet. Not capitalised. Plural "kanji") The Japanese word for a Han character used in Japanese. for the Japanese market. SYNAVANT Synpharma(SM) is a value-added val·ue-add·ed adj. Of or relating to the estimated value that is added to a product or material at each stage of its manufacture or distribution: solution encompassing SYNAVANT's intellectual property, which can be applied to Siebel Systems Siebel is a brand name of Oracle Corporation. Siebel Systems, Inc., founded by Thomas Siebel in 1993, was principally engaged in the design, development, marketing and support of CRM applications. ePharma technology without affecting the underlying architecture. "Last week we unveiled our Japanese version of SYNAVANT Synpharma(SM) to a large audience comprising delegates from 42 Japanese pharmaceutical companies. The local feedback was very positive and I am confident this tangible demonstration of our commitment to, and expertise in building PRM solutions to meet the specific needs of Japanese pharmaceutical companies will enable us to capture new opportunities in this important market," Yetter said. A discussion of second-quarter performance will be Webcast live on August 2, 2001 at 9 a.m. ET, and can be accessed via http://www.synavant.com. About SYNAVANT SYNAVANT Inc. guides biopharmaceutical and healthcare companies globally to greater business success by accelerating the adoption of advances in healthcare around the world. SYNAVANT accomplishes this by designing, building and supporting a wide range of knowledge-based solution sets, that bring together leading-edge technology, proven data management competence, a full range of specialist services and over 30 years of healthcare expertise. Its comprehensive, global solutions include Pharmaceutical Relationship Management (PRM) and eBusiness See e-business. applications, interactive marketing, server and database management, dedicated local helpline helpline Noun a telephone line set aside for callers to contact an organization for help with a problem helpline n → teléfono de asistencia al público support, training, telemarketing telemarketing, the practice of selling goods or services to customers by means of the telephone or of surveying consumer preferences in telephone conversations. , sample management, and product-recall services. SYNAVANT Inc. is the company formed by the spin-off The situation that arises when a parent corporation organizes a subsidiary corporation, to which it transfers a portion of its assets in exchange for all of the subsidiary's capital stock, which is subsequently transferred to the parent corporation's shareholders. of the Strategic Technologies and Clark-O'Neill units from IMS HEALTH IMS Health (NYSE: RX) is an international consulting and data services company that supplies the pharmaceutical industry with sales data and consulting services. IMS Health was founded in 1954 by Bill Frohlich and David Dubow. . SYNAVANT is headquartered in Atlanta Atlanta (ətlăn`tə, ăt–), city (1990 pop. 394,017), state capital and seat of Fulton co., NW Ga., on the Chattahoochee R. and Peachtree Creek, near the Appalachian foothills; inc. 1847. , GA, USA and has offices in 23 countries. SYNAVANT Synpharma(SM) and Synmetrics(SM) are service marks of SYNAVANT Inc. All other trademarks and tradenames referenced in this document are the properties of their respective owners. This news release includes 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. All statements other than statements of historical fact are forward-looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. , which can be identified by the use of words such as "may," "will," "expect," "anticipate," "estimate," "believe," "continue" or other similar words. Such forward-looking statements are based on management's current plans and expectations, and are subject to risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to: risks associated with operating on a global basis; the ability to identify, consummate To carry into completion; to fulfill; to accomplish. A Common-Law Marriage is consummated when the parties live in a manner intended to bring about public recognition of their relationship as Husband and Wife. and integrate acquisitions, alliances and ventures on satisfactory terms; the ability to develop new or advanced technologies, systems or products; the ability to successfully maintain historic effective tax rates; regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. , legislative and enforcement initiatives; the ability to obtain future financing on satisfactory terms and consolidation of the pharmaceutical industry. These risks and uncertainties are not intended to be exhaustive and should be read in conjunction with other cautionary statements discussed in more detail in the Company's filings with the Securities and Exchange Commission under 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. .
Table 1
SYNAVANT Inc.
Pro Forma Statement of Operations(a)
Three Months Ended June 30
(unaudited, in millions except per share)
2001 2000 % Constant $
Change Constant
Portfolio
Growth
--------- --------- --------- ---------
Revenue
Software Fees $ 4.0 $ 2.5 60% 65%
Software Services 22.3 21.4 4 7
Interactive Marketing 20.4 23.5 (13) (3)
--------- --------- --------- ---------
Total Revenue 46.7 47.4 (1) 5
Operating Costs (36.8) (34.6) 6
Research & Development (2.1) (4.2) (50)
Selling & Administrative Costs (8.8) (10.2) (14)
Depreciation & Amortization (5.4) (5.8) (7)
--------- ---------
Operating Loss $ (6.4) $ (7.4)
Other Expense, Net 0.3 0.1
--------- ---------
Loss Before Provision for
Income Taxes (6.1) (7.3)
Benefit for Income Taxes 0.1 4.5
--------- ---------
Pro Forma Net Loss $ (6.0) $ (2.8)
--------- ---------
Pro Forma Loss Per Share
(Basic and Diluted) $ (0.40) $ (0.19)
Average Shares Outstanding
(Basic and Diluted) 14.9 14.9
(a)Pro forma results include adjustments for: inclusion of $0.4
Interactive Marketing revenues for 2000 relating to the Pharbase
license agreement between SYNAVANT and IMS HEALTH; inclusion of $0.4
in Interactive Marketing cost of revenue for 2000 relating to the
Exponent license agreement between SYNAVANT and IMS HEALTH; inclusion
of $1.7 in selling & administrative expense for 2000 relating to the
estimated incremental run-rate costs of operating SYNAVANT as a
stand-alone, public company; exclusion of one-time spin-related costs
of $0.3; and inclusion of a tax provision of $0.1 in 2001 and tax
benefit of $0.8 in 2000 relating to the tax effect of pro forma
adjustments.
Table 2
SYNAVANT Inc.
Pro Forma Statement of Operations(a)
Six Months Ended June 30
(unaudited, in millions except per share)
% Constant $
2001 2000 % Constant $
Change Constant
Portfolio
Growth
--------- --------- --------- ---------
Revenue
Software Fees $ 7.2 $ 4.3 67% 73%
Software Services 43.8 43.4 1 4
Interactive Marketing 39.8 46.3 (14) (4)
--------- --------- --------- ---------
Total Revenue 90.8 94.0 (3) 3
Operating Costs (71.0) (69.2)
3
Research & Development (4.4) (6.8) (35)
Selling & Administrative Costs (18.2) (19.3) (6)
Depreciation & Amortization (10.7) (12.6) (15)
--------- ---------
Operating Loss $ (13.5) $ (13.9)
Other Expense, Net 0.2 0.1
--------- ---------
Loss Before Provision
For Income Taxes (13.3) (13.8)
Benefit (Provision) for
Income Taxes (2.2) 1.4
--------- ---------
Pro Forma Net Loss $ (15.5) $ (12.4)
--------- ---------
Pro Forma Loss Per Share
(Basic and Diluted) $ (1.04) $ (0.83)
Average Shares Outstanding
(Basic and Diluted) 14.9 14.9
(a)Pro forma results include adjustments for: inclusion of $0.8 in
Interactive Marketing revenue in 2000 relating to the Pharbase license
agreement between SYNAVANT and IMS HEALTH; inclusion of $0.8 in
Interactive Marketing cost of revenues for 2000 relating to the
Exponent license agreement between SYNAVANT and IMS HEALTH; inclusion
of $3.3 in selling & administrative expense in 2000 relating to the
estimated incremental run-rate costs of operating SYNAVANT as a
stand-alone, public company; exclusion of one-time spin-related costs
of $0.6; and inclusion of a tax provision of $0.2 in 2001 and tax
benefit of $1.4 in 2000 relating to the tax effect of pro forma
adjustments.
Table 3
SYNAVANT, Inc.
Summary Balance Sheet
(unaudited, dollars in millions)
June 30, December 31,
2001 2000
------------- ---------------
Assets
Current Assets
Cash and Cash Equivalents $ 9.1 $ 19.7
Accounts Receivable, Net 42.8 44.4
Other Current Assets 11.2 8.5
------------- -------------
Total Current Assets 63.1 72.6
Long-Term Notes Receivable 1.0 2.5
Property, Plant and Equipment, Net 11.5 13.6
Computer Software, Net 9.9 13.0
Goodwill, Net 46.5 52.9
Other Long-Term Assets 2.7 1.9
------------- -------------
TOTAL ASSETS $ 134.7 $ 156.5
------------- -------------
Liabilities and Stockholders' Equity
Current Liabilities
Accounts Payable $ 10.1 $ 11.6
Accrued Income Taxes 4.2 4.0
Deferred Revenue 11.8 13.2
Accrued & Other Current Liabilities 13.9 15.8
------------- -------------
Total Current Liabilities 40.0 44.6
Other Liabilities 9.7 9.7
------------- -------------
TOTAL LIABILITIES $ 49.7 $ 54.3
------------- -------------
Minority Interest -- 0.6
Stockholders' Equity 85.0 101.6
------------- -------------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 134.7 $ 156.5
------------- -------------
Table 4
SYNAVANT Inc.
Statement of Operations
Three Months Ended June 30
(unaudited, in millions except per share)
2001 2000
------------- ---------------
Revenue
Software Fees $ 4.0 $ 2.5
Software Services 22.3 21.4
Interactive Marketing 20.4 23.1
------------- -------------
Total Revenue 46.7 47.0
Operating Costs (36.8) (34.2)
Research & Development (2.1) (4.2)
Selling & Administrative Costs (8.8) (8.6)
Depreciation & Amortization (5.4) (5.8)
Spin-Related Costs (0.3) --
------------- -------------
Operating Loss $ (6.7) $ (5.8)
Other Expense, Net 0.3 0.2
------------- -------------
Loss Before Provision
For Income Taxes (6.4) (5.6)
Benefit for Income Taxes 0.2 3.7
------------- -------------
Net Loss $ (6.2) $ (1.9)
------------- -------------
Loss Per Share $ (0.42) $ (0.13)
Average Shares Outstanding
(Basic and Diluted) 14.9 14.9
Table 5
SYNAVANT Inc.
Statement of Operations
Six Months Ended June 30
(unaudited, in millions except per share)
2001 2000
------------- ---------------
Revenue
Software Fees $ 7.2 $ 4.3
Software Services 43.8 43.4
Interactive Marketing 39.8 45.5
------------- -------------
Total Revenue 90.8 93.2
Operating Costs (71.0) (68.4)
Research & Development (4.4) (6.8)
Selling & Administrative Costs (18.2) (15.9)
Depreciation & Amortization (10.7) (12.6)
Spin-Related Costs (0.6) --
------------- -------------
Operating Loss $ (14.1) $ (10.5)
Other Expense, Net 0.2 0.1
------------- -------------
Loss Before Provision
For Income Taxes (13.9) (10.4)
Provision for Income Taxes (2.0) (0.1)
------------- -------------
Net Loss $ (15.9) $ (10.5)
------------- -------------
Loss Per Share $ (1.07) $ (0.70)
Average Shares Outstanding
(Basic and Diluted) 14.9 14.9
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