VERITAS Announces Restatement Related to Previously Disclosed
Review of September 2000 Transactions With AOL Time Warner
MOUNTAIN VIEW, Calif., Jan. 17 /PRNewswire-FirstCall/ --
VERITAS Software Corporation (NASDAQ:VRTS), today announced that as a result
of the previously disclosed review of transactions with AOL Time Warner
entered into in September 2000, the Company will restate its financial results
to reflect that $20 million of license and support fees paid by AOL will not
be recognized as revenue and $20 million of advertising services paid to AOL
will not be recorded as expense. The periods affected by the restatement will
include fiscal years ended December 31, 2000 and 2001 and quarters ended
December 31, 2000 through September 30, 2002.
The transactions involved a $50 million software purchase by AOL and a
$20 million advertising services purchase from AOL. The Company originally
recognized $37 million of revenue in the fourth quarter of 2000 and has been
recognizing the remaining $13 million in revenue over a three-year support
period. The $20 million advertising services purchase was recorded as an
expense as the services were provided beginning in the fourth quarter of
2000 and ending in the fourth quarter of 2001.
The principal effect of the restatement for the year ended December 31,
2000 will be to reduce previously reported revenue of $1,207 million by
$17 million, or 1.4%, and to increase previously reported net loss of
$620 million by $7 million, or 1.1%. For the year ended December 31, 2001,
previously reported operating expenses of $1,812 million will be reduced by
$13 million, or 0.7%, and previously reported net loss of $651 million will be
reduced by $8 million, or 1.2%. For the nine months ended September 30, 2002,
previously reported revenue of $1,101 million will be reduced by $1 million,
or 0.1%, and previously reported net income of $107 million will be reduced by
less than $1 million, or 0.9%. The restatement has no effect on the Company's
cash position.
An unaudited summary table of the financial impact of the restatement is
attached to this release.
The Company expects to file restated financial statements for the affected
periods with the Securities and Exchange Commission by March 31, 2003. The
effects of the restatement described in this release and the attached table
are estimates and unaudited. Until the Company issues its restated financial
statements, investors should not rely upon the financial information contained
in the Company's previously filed annual reports on Form 10-K and auditors'
reports thereon for the fiscal years ended December 31, 2000 and 2001 or in
the Company's quarterly reports on Form 10-Q for the quarters ended March 31,
2001 through September 30, 2002. |
