Extended Systems Announces Fiscal 2001 First Quarter Results Mobile Information Management Software Revenue Grows 71% Year-Over-Year
Gross margins up to 57%
Monday October 23, 3:58 pm Eastern Time
Press Release
BOISE, Idaho--(BUSINESS WIRE)--Oct. 23, 2000--Extended Systems Inc. (Nasdaq:XTND - news), a leading provider of mobile information management (MIM) solutions, today announced results for its first fiscal quarter ended September 30, 2000.
For the first quarter of fiscal 2001, the company reported net revenue of $12.2 million, compared to net revenue of $13.1 million for the same period of last year. MIM software revenue was $5.0 million or 41% of net revenue, up 71% from $2.9 million or 22% of net revenue in the first quarter of last year.
The net loss for the first quarter of fiscal 2001 was $1.6 million or $0.15 per diluted share, as the company continued to make significant investments in R&D and sales and marketing for MIM products. This compares to a net loss of $3.1 million, or $0.34 per diluted share for the first quarter of fiscal 2000, which included $2.1 million (after-tax) in acquisition-related charges.
``Extended Systems continues to see broad acceptance of MIM products, in particular, MIM software products including its XTNDAccess Bluetooth wireless connectivity and XTNDConnect data synchronization and management software,'' said Steve Simpson, Extended Systems CEO and president. ``During the quarter, we also broadened or formed new relationships with industry leaders, such as Microsoft, IBM, 3Com, Casio, Microware Systems and iPlanet. We continue to be very encouraged by the growing proliferation of mobile computing and communications devices and are enthusiastic about our market opportunities as we continue to grow our software business.''
Net revenue from sales of MIM products was $8.7 million or 71% of net revenue, up from $8.5 million or 65% of net revenue for the first quarter of last year. MIM net revenue reflects increased sales of MIM software products, partially offset by an expected decrease in sales of MIM infrared hardware products to a large original equipment manufacturer customer. Also as expected, net revenue from the company's maturing printing solutions products continued to decline to $3.5 million, down from $4.6 million from the same period of last year.
The company's gross margin was 57% in the first quarter of fiscal 2001, up from 47% in the same period last year, due primarily to increased MIM software sales and the expected decrease in sales of lower margin infrared hardware sales.
The company was particularly pleased with the growing interest in its XTNDAccess Bluetooth technology during the quarter. Extended Systems was elevated to be an Associate Member of the Bluetooth Special Interest Group, significantly strengthening its position within the worldwide Bluetooth organization. During the quarter, the company also expanded its mobile market presence through developer seminars in Asia, a strategic area of focus due to the rapidly growing use of mobile devices in that market. Extended Systems and 3Com recently agreed to co-develop a solution for manufacturers and end-users that want to implement Bluetooth wireless technology with existing Windows-based PCs.
In addition, the company had a number of wins with its XTNDConnect data synchronization and management software. It announced that IBM will integrate XTNDConnect Server into IBM's WebSphere Everyplace Suite and that Casio is using Extended Systems' infrared wireless communication and data synchronization technologies in a new line of innovative wrist devices. Recent product introductions include XTNDConnect View, a companion product to XTNDConnect Server that enables users of wireless devices (Palm VII, RIM handhelds, WAP and HDML phones) to use the Internet for real-time access to personal information, such as e-mail, calendar and contact information, on their corporate servers.
Extended Systems management will hold an investor conference call on October 23, 2000, at 5:00 p.m. eastern time, to further discuss the financial results for the quarter and to discuss the business outlook for the coming quarter. The conference call can be heard live or replayed via an Internet broadcast at www.vcall.com.
About Extended Systems
Extended Systems is a leading provider of mobile information management solutions that enable users to access, collect, synchronize, and print information on demand. The company's products include data synchronization and management software, short-range wireless connectivity products (Bluetooth and IrDA-compliant), Linux-based Internet access solutions, a complete line of network print servers and client/server database management systems with remote access capabilities. Extended Systems' customers and key relationships include 3Com, IBM, Intel, Microsoft, Compaq, Motorola, Ericsson, Hewlett-Packard, Agilent, Sharp, NEC, and Toshiba. Founded in 1984, Extended Systems has offices and subsidiaries in the United States and worldwide. For more information, visit the company Web site at www.extendedsystems.com.
Except for historical information contained herein, the matters set forth in this press release, such as the expected growth in demand and market acceptance for the company's MIM products, the success of the company's MIM software strategy and the success of the company's relationships with Microsoft, IBM, 3Com, Casio, Microware Systems and iPlanet, are forward-looking statements that are subject to risks and uncertainties. These risks and uncertainties include the impact of competitive products and pricing, alternative technological advances, relationships with suppliers, the timely and successful development and market acceptance of new products and upgrades to existing products, the ability to integrate and manage acquired businesses and other risks as detailed from time-to-time in the company's SEC filings, including its Annual Reports on Form 10-K and the Quarterly Reports on Form 10-Q.
Extended Systems Incorporated
CONSOLIDATED STATEMENT OF OPERATIONS DATA
(in thousands, except per share amounts)
Quarter ended
September 30,
---------------------
2000 1999
--------- --------
Net revenue $ 12,229 $ 13,089
Cost of net revenue 5,249 6,978
-------- --------
Gross profit 6,980 6,111
Operating expenses:
Research and development 3,090 2,237
Acquired in-process research
and development -- 2,365
Marketing and sales 4,970 4,164
General and administrative 1,304 1,055
Amortization of intangibles 243 170
-------- --------
Loss from operations (2,627) (3,880)
Other expense (income), net (119) 79
Interest expense -- 178
-------- --------
Loss before income taxes (2,508) (4,137)
Income tax benefit (928) (1,076)
-------- --------
Net loss $ (1,580) $ (3,061)
======== ========
Loss per share:
Basic $ (0.15) $ (0.34)
Diluted $ (0.15) $ (0.34)
Number of shares used in
per share calculation:
Basic 10,360 8,995
Diluted 10,360 8,995
NET REVENUE BY SEGMENT
(in thousands)
Quarter ended
September 30,
------- -------
2000 1999
------- -------
Mobile information
management segment:
Software $ 4,955 $ 2,895
Hardware 3,767 5,590
------- -------
Total segment 8,722 8,485
Printing solutions segment 3,506 4,579
Other products segment 1 25
------- -------
Total $12,229 $13,089
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Extended Systems Incorporated
CONSOLIDATED BALANCE SHEET DATA
(in thousands, except par value per share amounts)
September 30, June 30,
2000 2000
------------ -------
ASSETS
Current:
Cash and cash equivalents $ 5,389 $ 6,191
Receivables 13,764 12,499
Inventories 2,762 3,484
Prepaids and other 1,200 1,200
Deferred income taxes 715 715
-------- --------
Total current assets 23,830 24,089
Property and equipment, net 7,647 7,817
Intangibles, net 5,833 6,237
Deferred income taxes 7,487 5,785
Other assets 293 293
-------- --------
Total assets $ 45,090 $ 44,221
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current:
Current debt $ -- $ 67
Accounts payable 3,586 3,026
Accrued expenses 2,835 2,643
Deferred revenue 1,014 770
-------- --------
Total current liabilities 7,435 6,506
-------- --------
Stockholders' equity:
Preferred Stock; $0.001 par
value per share, 5,000 shares
authorized; no shares issued
or outstanding -- --
Common stock; $0.001 par value
per share, 75,000 shares
authorized; 10,434 and 10,309
shares issued and outstanding 10 10
Additional paid-in capital 29,696 28,108
Retained earnings 8,960 10,540
Deferred compensation (219) (264)
Accumulated other
comprehensive loss (792) (679)
-------- --------
Total stockholders' equity 37,655 37,715
-------- --------
Total liabilities and
stockholders' equity $ 45,090 $ 44,221
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Contact:
Extended Systems
Chief Financial Officer
Karla K. Rosa, 208/322-7575
or
Extended Systems
Media Relations Manager
Joanne Taylor, 208/322-7575
or
StreetConnect
Michael Newman, 206/320-1231
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