SOURCE: InforMax, Inc.
InforMax Announces Third Quarter Results
BETHESDA, Md.--(BW HealthWire)--Oct. 31, 2001--InforMax, Inc. (Nasdaq:INMX - news) announced today that for the third quarter ended September 30, 2001 it is reporting revenue of $4.7 million, representing a 4% decrease compared to the $4.9 million achieved for the same quarter in 2000, and total bookings of $3.3 million representing a 27% decrease versus the same period last year.
Bookings represent the total face amount of contracted sales of company products and services in the period. The Company is also reporting a net loss per share for the third quarter, excluding non-cash charges related to stock based compensation, of ($0.21), which is slightly better than the net loss per share of ($0.25) for the third quarter of 2000.
The revenue shortfall in the third quarter was partly offset by savings achieved from on- going cost management efforts. Excluding the effect of costs tied directly to revenue, such as sales commissions, the Company reduced its previously reported operating cost running rate in the third quarter by approximately $0.8 million. These efforts resulted in an offset of approximately 30%, or a positive $0.04 per share, to the adverse profit impact from the quarter's revenue softness. The favorable cost reductions realized by the Company's various operating efficiency measures are also expected to have a positive effect in future quarters.
As highlighted during the Company's conference call on October 16, 2001, Alex Titomirov, Ph.D., Chairman and Chief Executive Officer, attributed the third quarter revenue results, in part, to weakness in the overall economy. He noted that during the third quarter the Company experienced delays in customer purchasing decisions, which are normally made at the end of the quarter, as a result of this more uncertain business climate.
InforMax also announced that it currently expects revenue to increase from the third quarter to between $7.0 million to $7.5 million in the fourth quarter of 2001. While this projection is below the Company's previous estimate of $9.4 million, made in early August, it reflects on-going strength in its desktop application business and the expected closing of several GenoMax deals that were delayed from the third quarter.
``Looking forward, we are already regaining revenue momentum in key segments of our business,'' said Titomirov. ``While we are cautious about the impact of the weaker economy on our software sales in the near-term, we continue to see substantial demand for desktop and enterprise-class systems that address the significant productivity challenges that our customers face.
As an example, we have already closed one GenoMax deal representing bookings of over $600,000 that had been delayed from the third quarter.``
The Company also disclosed that it would be reporting a $2.4 million charge in the fourth quarter of 2001 related to executive management changes announced two weeks ago. This charge has a cash flow impact of approximately $600,000 in the fourth quarter of 2001, with the balance of the payments to be made in subsequent periods.
The Company is also estimating a net loss per share for the fourth quarter, excluding non-cash charges related to stock based compensation and the charge related to the executive management changes, in the range of $(0.13) to $(0.15). In the fourth quarter of 2001, the Company's on-going cost management focus will translate into an anticipated $1.1 million improvement in the operating cost running rate versus the previous forecast, which will help to offset the profit impact of lower estimated revenues for the fourth quarter.
``We remain very optimistic about the long-term demand for life science informatics software and services,'' said Titomirov. ``InforMax will gain a significant share of this demand and we will continue to solidify our leadership position as we aggressively develop and broaden our industry leading tools and integrated solutions. We plan to continue to expand the functionality and customer reach of our suite of software solutions moving further down the value chain to target validation and beyond. In addition, we are in the process of building a strong integration, customization and workflow development and collaborative discovery services business. This will leverage our scientific and life science informatics expertise and our strong and established software business and installed customer base.
``We are also receiving exceptional customer response to our new Xpression NTI desktop module, introduced last month, and are excited about the release of GenoMax 3.2 scheduled for next week. With a strong balance sheet that includes a cash position of over $65 million and favorable operating cost trends, we are on track to achieve our target of profitability by the fourth quarter of 2002.'' |
