Novell Reports Third Quarter Results:
PROVO, Utah, Aug. 21 /PRNewswire/ -- Novell, Inc. (Nasdaq:NOVL) today reported revenue of $90 million and a net loss of $122 million, or ($0.35) per share, for its third fiscal quarter ended July 31, 1997. These results reflect decisions the company announced on May 28 to lower product inventories in its indirect distribution channel and to take a restructuring charge as it reduced its workforce by 18 percent. The restructuring charge of $55 million contributed ($0.10) per share, after tax, to the reported loss.
Dr. Eric Schmidt, Novell chairman and chief executive officer, said: ``The third quarter was an opportunity to take aggressive steps to stabilize Novell's business and set the stage for restoring revenue and profitability. Lower operating expenses, realigned resources, and improved information systems make Novell a tighter and more accountable $1 billion company. With these actions behind us, our focus is to deliver Internet products to make Novell a pure Internet/intranet software leader by summer 1998.''
Novell reported revenue of $365 million and earnings of $0.17 per share in the third fiscal quarter of 1996. ``However, given our third quarter 1997 actions, comparisons with previous periods are not indicative of Novell's market strength or opportunities,'' said Dr. Schmidt.
Novell's third quarter revenue was reduced from recent periods primarily due to actions the company took in response to changing market conditions. During the third quarter, the company did not ship products to its indirect distribution channel except to accommodate product exchanges and returns. This action brought channel inventory of boxed software products in line with current market demand.
Third quarter revenue was derived principally from sales to large network users through Novell's major account, corporate, and volume license programs. Among the customers licensing Novell products in the third quarter were KPMG Peat Marwick, Safeway Stores, Foundation Health Systems, Saatchi & Saatchi, UBS Switzerland, and the 36-campus State of Minnesota Department of State Colleges and Universities.
Novell reduced its workforce by approximately 1,000 employees in the quarter, bringing total headcount to approximately 4,800 worldwide. This reduction, coupled with an associated consolidation of facilities, is expected to lower operating expenses by $100 million annually, beginning in the fourth fiscal quarter of 1997.
On the balance sheet, cash and short-term investments were $1.1 billion at the end of the third quarter, approximately equal to the prior period and year-end 1996.
Founded in 1983, Novell is the world's leading provider of network software. The company offers a wide range of network solutions, education, and support for distributed network, Internet, and small-business markets. Information about Novell's complete range of products and services can be accessed on the World Wide Web at www.novell.com.
Forward looking statements in this release are made under the Safe Harbor Reform Act of 1996. These statements are based on current expectations and actual results may differ materially due to risks, uncertainties, and other factors. Additional information covering factors that could cause results to differ materially from projected statements can be found in Novell's 10-K and 10-Q filings, as well as the annual report.
SOURCE: Novell Inc. |
