Novell Reports Fourth Fiscal Quarter 1997 Results
PR Newswire - November 25, 1997 16:00
NOVL %CPR %ERN V%PRN P%PRN
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PROVO, Utah., Nov. 25 /PRNewswire/ -- Novell, Inc. (Nasdaq: NOVL) today
reported revenue of $269 million and net income of $7 million or $0.02 per
share for its fourth fiscal quarter ended October 31, 1997. After two
successive quarters of losses and restructuring in the third quarter, these
results mark a return to profitability, the restoration of revenue to near
second-quarter levels, and a $26-million decline in costs and expenses from
the second quarter.
"I'm pleased to report that demand for our products came back from our
entire distribution channel -- value added resellers, multi-product licensing
programs, and original equipment manufacturers," said Dr. Eric Schmidt, Novell
chairman and chief executive officer. "Fourth-quarter performance shows that
the changes we've made in Novell's business are taking hold. We have also set
a faster pace for product introductions and market initiatives."
"During the quarter, we delivered new Internet related products, including
BorderManager and GroupWise 5.2, that are indicative of the changes we will
make across our entire product line over the coming year. With the decisions
we've made, fiscal 1998 will be a year of further investment. These changes
are intended to build a strong foundation for our business and put Novell on a
path to becoming a pure Internet/intranet leader."
Novell's core business -- supplying software for very large
networks -- was its strongest ever. Revenue from multi-product, channel, and
end-user licensing programs reached a record $99 million or 37 percent of
total revenue, reflecting the continued strong adoption of Novell's software
by users of large networks. Representative of customers participating in
Novell's fourth-quarter license programs were Whirlpool Corporation,
Lenscrafters, Colgate-Palmolive, WorldCom, Liberty Mutual, American Home
Products, State Farm Insurance, BASF Corp., and the State of Ohio Department
of Human Services.
Channel partners also continued to be an important part of Novell's
business in the fourth quarter. Resellers accounted for approximately
54 percent of overall sales, which includes almost half of the multi-product
licensing revenue. Inventory of boxed software in the distribution channel
remained at new, lower levels established by the company in the third fiscal
quarter.
On the balance sheet, cash and short-term investments were $1.0 billion at
the end of fiscal 1997, up $9 million from year-end 1996. Days sales
outstanding declined to 79 days, from 107 days at year-end 1996, and were the
lowest in over two years.
For full fiscal year 1997, Novell recorded revenue of slightly more than
$1 billion and a net loss of $78 million or ($0.22) per share. The company's
third-quarter restructuring charge of $55 million contributed ($0.10) per
share, after tax, to the reported loss. These results compare with revenue of
$1.4 billion and net income of $126 million or $0.35 per share in fiscal 1996.
In the fourth fiscal quarter of 1996, Novell reported revenue of $384 million
and net income of $59 million, or $0.17 per share.
Founded in 1983, Novell is the world's leading provider of network
software. The company offers a wide range of network solutions, education, and
support for distributed network, Internet, and small-business markets.
Information about Novell's complete range of products and services can be
accessed on the World Wide Web at novell.com.
Forward looking statements in this release are made under the Safe Harbor
Reform Act of 1996. These statements are based on current expectations and
actual results may differ materially due to risks, uncertainties, and other
factors. Additional information covering factors that could cause results to
differ materially from projected statements can be found in Novell's 10-K and
10-Q filings, as well as the annual report.
Novell, Inc.
Consolidated Unaudited Condensed Statements of Operations
(In thousands, except per share data)
Fourth Fiscal Quarter Ended Fiscal Year Ended
Oct 31, Oct 26, Oct 31, Oct 26,
1997 1996 1997 1996
Net sales $269,283 $383,666 $1,007,311 $1,374,856
Cost of sales 62,630 66,518 277,446 306,761
Gross profit 206,653 317,148 729,865 1,068,095
Operating expenses
Sales and marketing 101,767 143,236 443,494 518,846
Product development 73,053 66,926 282,680 275,627
General and
administrative 37,402 38,668 148,360 146,236
Restructuring charges -- -- 55,335 18,442
Total operating
expenses 212,222 248,830 929,869 959,151
Income (loss) from
operations (5,569) 68,318 (200,004) 108,944
Other income (expense)
Investment income 20,161 16,480 61,315 58,195
Gain on sale
of assets -- -- -- 19,815
Other, net (802) (1,856) (11,881) (6,966)
Other income, net 19,359 14,624 49,434 71,044
Income (loss)
before taxes 13,790 82,942 (150,570) 179,988
Income taxes 6,619 23,912 (72,274) 53,997
Net income (loss) $7,171 $59,030 ($78,296) $125,991
Weighted average
shares O/S 353,337 345,520 349,429 357,919
Net income (loss)
per share $0.02 $0.17 ($0.22) $0.35
Novell, Inc.
Consolidated Unaudited Condensed Balance Sheets
(In thousands)
ASSETS Oct 31, 1997 Oct 26, 1996
Current assets
Cash and short-term
investments $1,033,473 $1,024,755
Receivables, net 234,358 452,327
Inventories 10,656 16,837
Prepaid expenses 57,685 59,009
Deferred & refundable
income taxes 134,210 37,831
Total current assets 1,470,382 1,590,759
Property, plant and
equipment, net 373,865 394,684
Other assets 66,402 64,023
Total assets $1,910,649 $2,049,466
LIABILITIES & SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable $82,759 $96,933
Accrued compensation 51,397 54,731
Accrued marketing liabilities 27,728 48,402
Other accrued liabilities 85,157 118,133
Income taxes payable -- --
Deferred revenue 74,915 46,573
Total current liabilities 321,956 364,772
Minority interests 23,276 17,035
Put warrants -- 52,150
Shareholders' equity 1,565,417 1,615,509
Total liabilities and
shareholders' equity $1,910,649 $2,049,466
SOURCE Novell, Inc.
/CONTACT: Peter Troop, 408-577-8975, or peter_troop@novell.com, or Austin
Edington, 408-577-6213, or aedgington@novell.com, both of Novell, Inc./
/Company News On-Call: prnewswire.com or fax, 800-758-5804,
ext. 100266/
/Web site: novell.com |
