Dave, I love those percentage increase in revenues! over 40% increase!
Friday November 12, 8:07 pm Eastern Time
Company Press Release
Touchstone Software Reports Third Quarter Results
NORTH ANDOVER, Mass.--(BUSINESS WIRE)--Nov. 12, 1999--TouchStone
Software Corporation (OTC BB: TSSW - news) today announced its third quarter 1999 financial results.
The company's third-quarter net loss before the effect of amortization of Goodwill and other intangibles was $(217,500) or,
(.02) cents per share. The third quarter net loss, which includes amortization of goodwill and other intangibles was
$(1,404,691) or (.12) cents per share, compared with a net loss of $(935,205) or (.12) cents per share in the third quarter of
1998.
For the nine months ended September 30, 1999, sales were $4,797,747 vs. $3,391,221 in the same period last year. For the
nine months the net loss before the amortization of goodwill, other intangibles and acquisition related costs was $(1,390,252) or
(.12) cents per share. The net loss for the period which includes amortization of goodwill, other intangibles and acquisition
related costs was $(3,772,803) or (.33) cents per share compared with a net loss of $(2,836,686) or (.36) cents per share in
the first nine months last year.
``TouchStone is presently transitioning the current product line into a new generation of TouchStone products. This transition,
which will result in a significantly strengthened product line going forward, has already been launched with the recent release of
FastMove! 2000 and will continue with the upcoming debut of the new CheckIt family of products,' said Pierre Narath,
Chairman, President and Chief Executive Officer of TouchStone Software Corporation. ``In addition, the summer months
historically show a decline in revenues throughout the retail channel, and TouchStone's results are no exception. The third
quarter results also reflect the overall softening of the retail market.'
About TouchStone Software
TouchStone Software Corporation is a leading developer of innovative software designed to help people use complex
technologies. The company's products, which include CheckIt 98 diagnostics, CheckIt 98 Diagnostic Suite bundle, CheckIt
NetOptimizer Internet utility and FastMove! File transfer program, are distributed worldwide through the retail, VAR,
distributor, direct and OEM sales channels. TouchStone's corporate headquarters are located at 1538 Turnpike Street, North
Andover, MA, 01845. European headquarters are located at Sonnnenstrasse 26b 85622 Feldkirchen, Germany
011-49-89-900479-16 (Phone), 011-49-89-900479-11 (Fax). Additional information about TouchStone Software is
available at www.touchstonesoftware.com
(Note: This release contains certain forward-looking statements regarding product development schedules, sales of products in
the future, return to profitability, financial position and growth plans. Such statements are subject to risks and uncertainties.
Actual results could vary materially from these statements or current trends. Investors should refer to TouchStone's 1998
10-KSB and first quarter 1999 10-QSB, for a fuller description of risk factors.)
For more information, contact Jill Abramson, S&S Public Relations at (847) 955-0700 (jilla@sspr.com), or Rich West,
Touchstone Software Corporation at (978) 686-6468 (rich_west@unicore.com).
--Financial Tables Follow--
Item 1. Consolidated Financial Statements
Touchstone Software Corporation
Consolidated Balance Sheet
September 30, 1999
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 3,307,774
Investments 753,915
Restricted cash 620,000
Accounts receivable, net 1,470,920
Inventories, net 88,936
Prepaid expenses and other current assets 469,604
--------------
Total current assets 6,711,149
Investments 574,500
Property, net 159,995
Other assets 58,019
Goodwill and other intangibles, net 2,333,746
==============
$ 9,837,409
==============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current maturities of long-term debt $ 22,321
Accounts payable 233,001
Accrued payroll and related expenses 394,821
Accrued cooperative advertising expense 355,139
Accrued merger and acquisition costs 1,276,649
Deferred revenue 1,081,810
Other accrued liabilities 184,978
--------------
Total current liabilities 3,548,719
Long-term debt, net of current maturities 528,190
Other liabilities 127,312
Commitments and contingencies
Shareholders' equity:
Preferred stock,
$.001 par value, 3,000,000 shares
Authorized; no shares issued or outstanding
Common stock,
$0.001 par value, 20,000,000 shares
Authorized; issued and
outstanding 11,340,060 shares 11,340
Additional paid-in capital 21,231,692
Accumulated deficit (15,609,844)
Total shareholders' equity 5,633,188
==============
$ 9,837,409
==============
See accompanying notes to condensed consolidated financial statements.
Touchstone Software Corporation
Consolidated Statement of Income
(Unaudited)
Three Months ended Nine months ended
September 30, September 30,
1999 1998 1999 1998
------ ------ ------ ------
Net revenues $ 1,569,204 $ 748,956 $ 4,797,747 $ 3,391,221
Cost of revenues 213,228 205,374 696,746 847,732
----------- --------- ----------- -----------
Gross profit 1,355,976 543,582 4,101,001 2,543,489
Operating expenses:
Sales and marketing 541,819 624,776 1,332,396 2,269,137
General and
administrative 843,593 480,420 3,726,058 1,218,120
Research and
development 274,183 422,631 617,401 1,487,930
Amortization of
goodwill
and other
intangibles 1,187,191 - 2,382,551 -
Restructure - 85,220 - 863,359
----------- --------- ----------- -----------
Total operating
expenses 2,846,786 1,613,047 8,058,406 5,838,546
----------- --------- ----------- -----------
Loss from
operations (1,490,810) (1,069,465) (3,957,405) (3,295,057)
Interest and other
income, net 86,119 134,260 185,402 459,171
----------- --------- ----------- -----------
Income before
income taxes (1,404,691) (935,205) (3,772,003) (2,835,886)
Provision for
income taxes - - 800 800
----------- --------- ----------- -----------
Net loss $ (1,404,691 $ (935,205) $ (3,772,803) $(2,836,686)
----------- --------- ----------- -----------
Basic and diluted
net loss per share $ (0.12) $ (0.12) $ (0.33) $ (0.36)
=========== ========= =========== ===========
Weighted average
common shares 11,340,060 7,948,000 11,340,060 7,920,000
=========== ========= =========== ===========
See accompanying notes to condensed consolidated financial statements.
Supplemental (A)
Historical net
income (loss) $(1,404,691) $(935,205) $(3,772,803) $(2,836,686)
Add back certain
non-cash and
merger costs:
Amortization of
goodwill and
acquired
intangibles (B) 1,187,190 2,382,551
Merger related
costs 85,220 863,359
Total add back 1,187,190 85,220 2,382,551 863,359
Supplemental net
income excluding
certain non-cash
and merger related
charges (loss)
Supplemental net
income per share: (217,500) (849,985) (1,390,252) (1,973,327)
Basic $(.02) $(.11) $(.12) $(.25)
(A) The accompanying supplemental financial information is presented
for informational purposes only and should not be considered as a
substitute for the historical financial information presented in
accordance with generally accepted accounting principles.
(B) Expenses associated with the amortization of acquisition related
charges are included within operating expenses under the heading
"amortization of goodwill and acquired intangibles."
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