eXcelon Announces Fourth Quarter and Year End Results
BURLINGTON, Mass.--(BUSINESS WIRE)--Feb. 13, 2002--eXcelon(TM) Corporation (Nasdaq: EXLN) today announced results for the fourth quarter ending December 31, 2001. Total revenues for the fourth quarter were $13.8 million as compared to the $15.5 million for the same period of 2000. Pro forma net loss for the fourth quarter 2001, excluding charges for goodwill impairment, was $4.7 million, or $0.08 loss per share, as compared with a net loss of $7.4 million, or $0.25 loss per share for the same period last year.
For the year ending December 31, 2001, total revenues were $49.2 million, compared to $70.3 million for the year ending December 31, 2000. Pro forma net loss for the year ended December 31, 2001, excluding charges for goodwill impairment, was $27.2 million or $.71 loss per share, as compared to net loss of $11.0 million or $0.38 loss per diluted share for the prior year.
For the quarter ended December 31, 2001, the company recorded a charge for the impairment of goodwill equaling $32.8 million or $0.58 per share. Including this goodwill impairment charge, net loss for the quarter was $37.5 million, or $0.66 per share and the full year net loss was $60 million or $1.58 per share. The goodwill impairment charge writes down to $394,000 the intangible assets recorded at the time of the company's acquisition of C-bridge Internet Solutions in Q3 2001. The acquisition of C-bridge was accounted for as a purchase business combination in accordance with SFAS No.141 and FAS No. 142. Under these new accounting rules, goodwill no longer amortizes but instead remains on the balance sheet as a long-lived asset and is subject to impairment testing periodically but at least once a year. This testing, which was based on a cash flow analysis of incremental future cash flows resulting from the acquisition, was performed as part of the company's year end audit completed this month. There is no cash impact to this write off.
The company's cash, cash equivalents, and short-term investments at the end of Q4 2001 totaled $28.9 million.
"With our acquisition and restructuring complete, we are ready to exploit the strong market opportunity for operational data stores for distributed XML and Java applications in 2002, and our recent announcements with Intel, Philips and HP demonstrate our momentum in the market," said Joe Bellini CEO of eXcelon. "Our strong cash position, our laser focus on our core competencies -- including our XML database and our high performance accelerators for J2EE -- and our commitment to fiscal fitness position us to achieve profitability in 2002."
eXcelon also announced that Raymond J. Lane and Kevin J. Burns have retired from its board of directors.
"We thank Ray and Kevin for their service and counsel as board members," said Bellini. "Their guidance has helped us through a difficult economic climate, our strategic combination with C-bridge and an integration period. They leave us positioned for success in 2002."
"It has been a pleasure to serve as a board member and contribute to eXcelon's vision and strategic direction during an important time in the company's evolution," said Ray Lane, general partner Kleiner, Perkins, Caufield, and Byers. "I am confident that eXcelon has taken appropriate measures to capitalize on the growing opportunity presented for mid-tier data management solutions for XML and Java, and believe that under Joe's direction the company is on a path to success."
"It has been an honor to serve on eXcelon's Board of Directors over the years and to help the company chart its course for the next phase under Joe's leadership," said Kevin Burns, managing principal, Lazard Partners. "I strongly believe that the company is poised to do great things in 2002 and beyond."
The company also updated slightly its previous financial guidance for the first half of 2002 as given on January 9, 2002. eXcelon forecasts its Q1 2002 revenues to be $12 to $14 million with a net loss of $1.0 to $3.0 million or a $0.02 to $0.05 loss per share before restructuring charges. For Q2 2002, the company continues to forecast break-even results with both revenues and expenses of approximately $14 million and be cash flow neutral. Additionally, on January 9, 2002, the company announced an expected restructuring charge to be taken in Q1 2002 of approximately $0.01 per share, primarily as a result of severance payments from the January 9, 2002 reduction in force. Based on this guidance the company forecasts it will have $22 to $23 million in cash at the end of Q2 2002.
eXcelon will hold a conference call and an audio webcast at 5:30 p.m. EST today to discuss its fourth quarter and year-end results.
The details for the eXcelon Q4 2001 webcast and conference call are as follows: The session may be accessed by visiting www.corporate-ir.net/ireye/ir-site.zhtml?ticker=EXLN&script=2400&item or by calling 1-800-603-6815 (706-634-5028 for international callers). There is no access code. The conference call will be available via replay for seven days by calling 1-800-642-1687 (706-645-9291 for international callers) and entering Conference ID #2919162.
About eXcelon
eXcelon Corporation is a leading provider of data management software designed to accelerate the performance of distributed applications built using XML and Java and deployed on market leading software platforms. eXcelon's core products, XIS, Javlin and ObjectStore, deliver enhanced levels of speed, flexibility, scalability and run-time availability to Web Services and distributed applications, which can result in substantial cost savings and significant competitive advantage for large and mid-sized enterprises. For corporate developers and software engineers who need to manage XML in a distributed environment, eXcelon Corporation's eXtensible Information Server (XIS) is a native XML database management system that provides the speed and throughput necessary to manage the extreme flexibility of XML. The product is unique in that it provides node level management. Javlin, a J2EE data cache manager, offers high performance distributed Java data caching that enables organizations to meet the productivity requirements of mid-tier J2EE application environments while attaining greater extensibility and scalability. ObjectStore delivers best of breed data-management for Java and C++ to ensure the rapid propagation and availability of data for complex Web transactions, dynamic content, network management systems and a multitude of applications for independent software vendors (ISVs).
Headquartered in Burlington, MA, eXcelon has more than 4,000 customers worldwide, including market leaders in key industries such as telecommunications, financial services, retail and manufacturing. eXcelon markets its solutions globally through value-added resellers, system integrators, consulting firms, OEM licensees and direct sales channels. For more information, please visit the eXcelon Web site at www.exceloncorp.com.
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995:
Statements in this press release that do not relate to historical facts are forward-looking statements. Such statements are not guarantees of future performance, and are subject to substantial risks and uncertainties and involve assumptions that could cause the future results of eXcelon to differ materially from those expressed in any forward-looking statements. eXcelon disclaims any intent or obligation to update publicly any forward-looking statements whether in response to new information, future events or otherwise.
Important factors that could cause our actual results to differ from these forward-looking statements include the risk that the businesses of eXcelon and C-bridge Internet Solutions, Inc., which was merged with eXcelon on September 19, 2001, will not be integrated successfully; costs related to the merger of eXcelon and C-bridge; the possibility that the recent restructuring of our business operations, as well as any additional restructuring initiatives, may not produce improvements in our operating results; the risk that our common stock may not continue to trade on the Nasdaq National Market; market demand for XML-based products; the risk that our revenues will not grow rapidly enough to offset increased expenditures that we are incurring to develop and market our new XML-based products; the fact that a significant portion of the combined company's revenues to date have been derived from sales of eXcelon's Object Design data management products, the market for which is stable or declining; the profitability of our Internet professional services contracts; our ability to retain existing Internet professional services clients and attract new clients; the possibility that we may be unable to keep pace with the rapid technological change and intense competition that characterize our markets; the occurrence of any failure of the Internet; the continued improvement of security on the Internet; general economic and industry conditions; factors described under the heading "Risk Factors" in our Registration Statement on Form S-4 relating to the merger, as filed with the Securities and Exchange Commission on August 17, 2001; and other factors described under the heading "Certain Factors that May Affect Future Results" in our Annual Report on Form 10-K for the year ended December 31, 2000, as amended, as filed with the Securities and Exchange Commission as well as factors described under the heading "Risk Factors" in C-bridge's Annual Report on Form 10-K for the year ended December 31, 2000, as amended, as filed with the Securities and Exchange Commission.
NOTE: C-bridge, Object Design and ObjectStore are registered trademarks of eXcelon Corporation. eXcelon, EXLN, Xpress, eXcelon Portal Server, eXcelon Integration Server, eXcelon eSolutions, Stylus, Cache-Forward, and Javlin are trademarks of eXcelon Corporation. All other trademarks are the property of their respective owners.
eXcelon Corporation
Consolidated Statements of Operation
(in thousands, except per share data)
Three Months Ended Twelve Months Ended
December 31, December 31,
2001 2000 2001 2000
Revenues:
Software $ 3,959 $8,859 $21,744 $43,118
Services 9,863 6,606 27,447 27,229
Total revenues 13,822 15,465 49,191 70,347
Cost of revenues:
Cost of software 179 1,119 1,096 2,921
Cost of services 5,769 4,651 16,322 18,059
Total cost of revenues 5,948 5,770 17,418 20,980
Gross profit 7,874 9,695 31,773 49,367
Operating expenses:
Selling and marketing 6,992 11,871 33,783 41,730
Research and development 3,067 3,329 13,091 12,859
General and administrative 2,693 2,131 10,352 7,157
Restructuring costs -- -- 2,442 --
Impairment of intangibles 32,860 -- 32,860 --
Total operating expenses 45,612 17,331 92,528 61,746
Operating loss (37,738) (7,636) (60,755) (12,379)
Other income, net 201 253 733 1,368
Income before income taxes (37,537) (7,383) (60,022) (11,011)
Provision for income taxes -- -- 15 --
Net loss $(37,537) $(7,383) $(60,037) $(11,011)
Loss per share:
Basic $(0.66) $ (0.25) $(1.58) $(0.38)
Diluted $(0.66) $ (0.25) $(1.58) $(0.38)
Weighted average shares outstanding:
Basic 57,241 29,551 38,086 29,348
Diluted 57,241 29,551 38,086 29,348
eXcelon Corporation
Condensed Consolidated Balance Sheets
(In thousands)
December 31, December 31,
2001 2000
ASSETS
Current assets:
Cash, cash equivalents and
short term investments $28,865 $ 16,060
Accounts receivable, net 8,904 13,767
Prepaid expenses and other current assets 3,110 1,826
Total current assets 40,879 31,653
Property and equipment, net 7,942 6,233
Marketable securities 309 610
Goodwill & other purchased intangibles 394 --
Other assets 3,106 2,250
Total assets $ 52,630 $40,746
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued expenses 14,863 $10,935
Obligations under capital lease 100 --
Deferred revenue 6,234 8,511
Total current liabilities 21,197 19,446
Stockholders' equity 31,433 21,300
Total liabilities and
stockholders' equity $52,630 $40,746
CONTACT:
eXcelon Corporation
Lacey Brandt, 781/674-5315
brandt@exceloncorp.com
or
FiComm
Elise Caffrey, 978/475-1773
elise.caffrey@ficomm.com
or
Greenough Communications
Janette Mandell, 617/275-6532
jmandell@greenoughcom.com
KEYWORD: MASSACHUSETTS
BW2531 FEB 13,2002
13:31 PACIFIC
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