AremisSoft Announces Key Management Changes and Additions
NEW YORK--(BUSINESS WIRE)--July 31, 2001--AremisSoft Corporation (NASDAQ:AREM - news)--
- Announces Cooperation with Securities and Exchange Commission Investigation
- Anticipates Second Quarter Results Reporting Delay
- Comments on Guidance for the Second Quarter and Year End
AremisSoft Corporation (NASDAQ:AREM - news), a leading international supplier of enterprise-wide software and
Internet-enabled solutions for the manufacturing, hospitality, healthcare and construction industries, announced
today the appointment of Roys Poyiadjis as Chairman and Chief Executive Officer. Previously Mr. Poyiadjis was
Co-CEO of AremisSoft.
Dr. Lycourgos Kyprianou, Chairman, Founder and Co-Chief Executive Officer, has retired from his position as
Chairman and Co-Chief Executive Officer and as a member of the Board of Directors. Dr. Kyprianou has accepted
the position of Founding Chairman of the Company, a non-executive advisory position, in recognition of his founding
the Company and his long years of service.
To further strengthen the management team and Board, the Company also announced that Dr. Paul I. Bloom,
recently appointed President of the US Group, will assume the title of President and Chief Operating Officer of
AremisSoft and has been elected to its Board of Directors.
Mr. Poyiadjis commented, ``We appreciate Dr. Kyprianou's contributions to the Company and look forward to his
continued service in his role as Founding Chairman. Paul and I have worked together for several years and he has
made significant contributions towards building and strengthening our U.S. based business. I look forward to his
assistance in helping to move AremisSoft forward around the globe. AremisSoft is entering a new phase in its
development. I believe we need to sharpen our focus on key growth opportunities and coalesce our management
structure to be more responsive to the rapidly changing business environment in which we operate.''
The Company also announced the appointment of David Latzke as Chief Financial Officer, replacing Michael
Tymvios, who has resigned his position as Chief Financial Officer and Director of the Company, citing health
reasons. Mr. Latzke, the former Chief Financial Officer of Fourth Shift Corporation, a wholly owned subsidiary of
AremisSoft, has joined AremisSoft as Chief Financial Officer. Mr. Latzke joined Fourth Shift in 1993 and was CFO
when the Company was acquired by AremisSoft in April of this year. Prior to his tenure at Fourth Shift, Mr. Latzke
was a ten year veteran of Arthur Andersen, in its audit and business advisory group. He holds a BA in accounting
from the University of Northern Iowa and is a CPA.
Mr. Poyiadjis commented, ``All of us are pleased to welcome David and look forward to working closely with him. His
experience at Fourth Shift will be invaluable to us as we move the Company's financial reporting and accounting
functions from Europe and India to the United States.''
The Company also announced that it is cooperating with a Securities and Exchange Commission investigation into,
among other things, its contract with the National Health Insurance Fund of Bulgaria (``NHIF''). In connection with the
Securities and Exchange Commission investigation, the Company has engaged its independent auditors PKF,
formerly known as Pannell Kerr Forster, an international accounting firm, to conduct a special review of the
payments the Company received in connection with its contract with the NHIF for fiscal year 2000. While PKF has
not completed its review, it has advised the Company that it has been able to confirm the Company's receipt of $1.7
million from the NHIF. However, it is still seeking additional documentation to confirm the receipt of an additional $5.4
million of revenue recognized by the Company in fiscal year 2000. The $5.4 million in revenue is related to a contract
between that third party and AremisSoft that gives that third party certain exclusive rights under AremisSoft's
contract with the NHIF. However, because the Company, despite its continued efforts, has been unable over the last
several days to contact executives who are most knowledgeable about the NHIF contractual arrangements within its
Indian-based Emerging Markets group, it has been unable to provide PKF with the information it needs to complete
its review of the NHIF contract. In order to address this issue, the Company, in addition to asking PKF to perform its
special review, has asked its attorneys to review the contracts and payments in question.
The above key management changes and additions, including the resignation of the former Chief Financial Officer,
and the Company's special review by its accounting firm PKF will further delay AremisSoft's reporting of its financial
results for the second quarter of 2001. The Company expects that earnings and revenues for the second quarter, as
well as for the year, will fall substantially short of Wall Street analysts' estimates.
About AremisSoft Corporation
AremisSoft develops, markets, implements and supports enterprise-wide applications software targeted at
mid-sized organizations in the manufacturing, healthcare, hospitality and construction industries. The Company's
software products help streamline and enhance an organization's ability to manage and execute mission-critical
functions such as accounting, purchasing, manufacturing, customer service and sales and marketing. AremisSoft
reported total revenue of $123.6 million for the twelve months ended December 31, 2000. AremisSoft has
approximately 1,300 employees, with sales in over 20 countries and a customer base in excess of 8,000. The
Company also operates software development and support facilities in India, with approximately 300 employees,
which provides significant organizational efficiencies and cost advantages in software development and support.
Cautionary Statement for Purposes of the ``Safe Harbor'' Provisions of the Private Securities Litigation Reform Act of
1995: All statements, other than historical facts, included in the foregoing press release regarding the Company's
financial position, business strategy, and plans of management for future operations are ``forward looking
statements.'' These statements are based on management's beliefs and assumptions, and on information currently
available to management. Forward looking statements include, but are not limited to, statements in which words
such as ``expect,'' ``see,'' ``anticipate,'' ``intend,'' ``plan,'' ``believe,'' ``estimate,'' ``consider,'' or similar expressions
are used. Forward looking statements are not guarantees of future performance. They involve risks, uncertainties,
and assumptions, including risks discussed under ``Risk Factors'' in the Company's annual report on Form 10-K,
SEC File No. 0-25713, all of which are incorporated herein by reference. The Company's actual results and
stockholder values may differ materially from those anticipated or expressed in these forward looking statements.
Many of the factors that will determine these results and values are beyond the Company's ability to control or
predict. Readers of this press release are cautioned not to put undue reliance on any forward looking statement. The
Company undertakes no obligation to publicly update these forward looking statements, whether as a result of new
information, future events or otherwise.
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Contact:
AremisSoft Corporation
Paul Bloom, 856/869-0770
paul.bloom@aremissoft.com
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