TigrSoft third-quarter results
TigrSoft Inc TGF
Shares issued 22,010,000 Sep 16 close $0.42
Fri 17 Sept 99 News Release
Mr. Dilip Kembhavi reports
TigrSoft Inc., a leader in the development and implementation of advanced
planning and scheduling systems, has released its financial results for the
third quarter ended July 31, 1999.
For the quarter ended July 31, the company posted revenue of $551,749,
compared with a year earlier when it recorded sales of $1,670,635. Revenues
from implementation, extended support, training and consulting, and other
sources accounted for $508,087 or 92 per cent of revenue, while revenue
from license fees accounted for $43,662 or 8 per cent of revenue.
The company reported a before-tax loss of $2,005,012, compared with income
in the prior year's period of $152,499, reflecting increased costs pursuant
to the establishment and staffing of regional sales and support offices in
the United States. As a result of its increased spending on marketing and
infrastructure, the company posted an after-tax loss of $1,739,531 or loss
per share of eight cents over net earnings of $75,448 in the same quarter
of fiscal 1998, when earnings per share were nil. At the end of the
quarter, the company had cash and short-term investments in the amount of
$3,973,996.
Quarterly highlights
The following activities were announced or occurred since the company's
last financial reporting period.
The quarter began with a contract from Fuji Photo Film Inc., a subsidiary
of Fuji Photo Film Co., Ltd., of Tokyo, a leading manufacturer of imaging
and information products. Fuji purchased a license for TigrAPS to manage
the planning and scheduling needs for one process in one of its plants in
Greenwood, S.C. TigrAPS is a highly-specialized advanced planning and
scheduling application, which incorporates a practical blend of heuristics,
mathematical algorithms and artificial intelligence techniques to generate
practical, workable and implementable schedules.
In June, the Tata Engineering & Locomotive Co., the sixth largest
automotive manufacturer in the world, purchased a corporate license for
TigrAPS, the company's advanced planning and scheduling system for its new
passenger car manufacturing plant in Pune, India. Subsequent to quarter
end, TigrSoft received a sign off from TELCO on the implementation, one of
the most rapid in corporate history.
Finally, in July, with building its sales organization as the primary
focus, the company clarified its prospects and expectations for the balance
of the year with the announcement that it expects to return to strong sales
growth and profitability in year 2000. The announcement followed a
strategic review with its operational vice-presidents and a meeting of the
board of directors. The company's business plan includes a number of sales
and marketing initiatives designed to help the company achieve greater
sales growth, profitability and shareholder value in the future.
The TigrSoft has started implementing a strategic sales process aimed at
vertical markets where the company has had success in the past. These
include the automotive and aerospace and defence, chemical and
pharmaceutical operations, made-to-order and engineer-to-order as well as
consumer packaged goods markets. Over the past three quarters, the company
has invested heavily in building its sales and marketing and implementation
infrastructure. These increased expenditures impacted negatively on
earnings and are expected to impact on year-end earnings. The company
indicated that it estimates that its new sales force will require four to
six months to become productive. As a result, the company expects that both
license fees and total revenue will be similar to the revenue realized in
the first two quarters.
"Our ability to capture a share of the North American advanced planning and
scheduling software business since we financed the company in 1998,
permitted us to build the infrastructure we required and provided an
umbrella under which we could explore key vertical markets as areas for
possible future growth," commented Dilip Kembhavi, president and chief
executive officer. "Building a strong sales organization took us longer
than expected and we did have a few false starts. However, we believe our
management team is now in place and that we can face the year ahead with
optimism for our shareholders, customers and employees. We are confident
that our products and our team of talented people remain the strongest and
the best in the business, and that we will substantially benefit from these
strengths in the future," he added.
CONSOLIDATED STATEMENT OF INCOME
Three months ended July 31
1999 1998
Revenue
License fees $ 43,662 $ 571,200
Implementation
and consulting 361,202 1,050,650
Extended support 146,885 48,785
--------- ---------
551,749 1,670,635
Cost of sales 1,046,154 634,158
--------- ---------
Gross margin (494,405) 1,036,477
Sales and
marketing 617,853 296,839
Research and
development 303,171 139,266
General and
administration 486,974 589,523
Amortization 92,480 55,704
--------- ---------
(1,994,883) (44,855)
Other income
(expenses) (10,129) 197,354
--------- ---------
Income (loss)
before tax (2,005,012) 152,499
Provision for
income taxes
Current - 70,423
Deferred (265,481) 6,628
--------- ---------
(265,481) 77,051
--------- ---------
Net income
(loss) (1,739,531) 75,448
--------- ---------
Earnings (loss)
per share (8 cents) 0
CONSOLIDATED STATEMENT OF INCOME
Nine months ended July 31
1999 1998
Revenue
License fees $ 861,780 $2,393,820
Implementation
and consulting 1,406,838 2,243,238
Extended support 431,428 199,528
--------- ---------
2,700,046 4,836,586
Cost of sales 2,864,878 1,571,266
--------- ---------
Gross margin (164,832) 3,265,320
Sales and
marketing 1,772,322 937,112
Research and
development 852,544 261,054
General and
administration 1,626,954 1,255,507
Amortization 247,224 98,751
--------- ---------
(4,663,876) 712,896
Other income
(expenses) (18,578) 280,822
--------- ---------
Income (loss)
before tax (4,682,454) 993,718
Provision for
income taxes
Current (412,444) 368,063
Deferred (559,491) 88,565
--------- ---------
(971,935) 456,628
--------- ---------
Net income
(loss) (3,710,519) 537,090
--------- ---------
Earnings (loss)
per share (17 cents) 3 cents
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