FileNET Corporation (FileNET or the Company) develops, markets and services a family of integrated document management software products designed for managing information and enhancing enterprise productivity.
From the previous quarter FileNet's revenues are down approx 11%, profits turned into losses and the company announced a restructuring in November to reduce overhead. Will the planned restructuring further reduce revenues? Can FILE return to profitability? Could the recent run-up be attributed to message board HYPE?? Thoughts and answers to these and any other issues regarding FILE are welcome.
Nov. 19, 1998--FileNET Corp.announced today a restructuring that will result in the reduction of approximately 100 employees and contractors worldwide across FileNET's sales, marketing and international functions and restructuring charge of approximately $2 million related to these activities is expected to be recorded in the fourth quarter of 1998.
(The following figures are in thousands)
Three months ended September 30th
Revenue
Software: 36,128
Service: 29,763
Hardware: 5,261
Total revenues: 71,152 (change from previous quarter -11%)
Net income (loss) $ (5,779)
Three Months ended June 30th
Revenue
Software: 44,403
Service: 29,467
Hardware: 6,502
Total revenues 80,372 (change from previous quarter +9%)
Net income (loss)........... $ 4,635
Three months ended March 31
Revenue
Software: 43,247
Service: 23,471
Hardware: 6,891
Total revenues:73,609
Operating income (loss)....... $2,576
Total revenue Nine Months Ended Sept. 30,
1998: $225,133
1997: $ 175,023
Net income (loss)
1998: $1,381
1997: $(11,383)
The magnitude of the increase in year to date revenue over 1997 is partially attributable to weakness in orders during the first quarter of 1997 and is not indicative of future revenue growth.
The market for the Company's products is highly competitive. The Company's principal competitors for its various product lines include the following companies: 1) Workflow and document imaging-- Banctec, Inc., IBM, Keyfile, Optika, Unisys Corporation, Mosaix, Eastman Software, a Kodak company, 2) Electronic Document Management--Documentum, IBM, Interleaf, Novasoft, Novell, Open Text, PC DOCS, and 3) COLD--Computron, IBM and Microbank. Numerous smaller software vendors also compete in each product area. The Company also experiences competition from systems integrators who configure hardware and software into customized systems. |
