FWIW:
CBT shares plummet on plans to shift to Internet
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LOS ANGELES, Oct 19 (Reuters) - Shares of CBT Group Plc
CBTSY.O fell sharply on Tuesday after the producer of
interactive educational software announced plans to transfer
its operations to the Internet.
CBT said the shift will require adjustments in the way it
accounts for revenue. Stock market sources said traders were
concerned about the change.
Company officials, however, did not return repeated calls
seeking comment.
The Redwood City, Calif.-based company's shares were down
11 at 16-1/4 in late trading on Nasdaq.
CBT, which said it will change its name to SmartForce
SMFT.O on Wednesday, also on Tuesday reported net income of
$6.1 million, or $0.11 a share, for the quarter ended Sept. 30,
compared with $2.9 million, or $0.06 a share, in the same
quarter last year.
The results matched Wall Street estimates as compiled by
tracking company First Call/Thomson Financial.
CBT said it planned to make significant ongoing investments
in its Internet infrastructure and in building its new brand.
The company said it planned to "redefine the learning industry
by unveiling a first-of-its-kind, fully integrated,
Internet-based e-Learning solution."
The company also explained that because it will be
providing access to an Internet environment rather than selling
software licenses, revenue under the new agreements will be
recognized under generally accepted accounting principles over
the term of the agreements rather than annually in advance.
"Revenue deferred under e-Learning agreements will be added
to SmartForce's backlog, thereby significantly increasing the
company's backlog of business in addition to strongly enhancing
the predictability of the company's future revenues," CBT said
in a statement.
REUTERS
Rtr 20:57 10-19-99
Copyright 1999, Reuters News Service |
