Industri-Matematik International Announces Year End and Fourth Quarter Results
STOCKHOLM, Sweden--(BUSINESS WIRE)--May 25, 1999--
- Restructuring Plan Completed with Operating Costs
To Be Reduced By More Than $40 Million -
Industri-Matematik International Corp. (www.im.se and NASDAQ-NM
Symbol: IMIC), a recognized leader in customer-driven supply chain
management solutions, today announced unaudited results for the fourth
quarter and fiscal year ended April 30, 1999.
Revenues for the three months ended April 30, 1999 were
$20,069,000 compared to $29,492,000 for the same period in 1998.
License revenue was $2,572,000 versus $8,882,000 for the fourth
quarter in fiscal 1998. Service and maintenance revenue was
$17,055,000 compared to $19,729,000 for the same period in 1998.
Reported net loss for the three months ended April 30, 1999 was
$(11,595,000) or $(0.36) per share, compared to net income of
$1,432,000, or $0.04 per share, for the same period last year.
During the fourth quarter, the Company incurred a $3,522,000
one-time restructuring charge in connection with the previously
announced cost realignment plan. Adjusting for the restructuring
charge, net of taxes, the net loss was $(9,200,000) or ($0.29) per
share.
Revenues for the fiscal year ended April 30, 1999 were
$86,968,000 compared to $95,384,000 for fiscal 1998. License revenue
was $17,039,000 compared to $36,090,000 in fiscal 1998. Reported net
loss for fiscal 1999 was $(35,259,000), or $(1.09) per share, compared
to net income of $9,393,000, or $0.30 per share, in fiscal 1998.
Excluding the above-mentioned restructuring charge, net of taxes, the
net loss for fiscal 1999 would have been $(32,864,000) or $(1.01) per
share.
Commenting on the results, Stig Durlow, President and Chief
Executive Officer of Industri-Matematik, stated, "Our business model
is shifting from a few very large deals to a mix of large and small
deals along with repeat orders from existing customers. This shift
reflects changing market conditions partially related to Y2K as target
customers are less likely to invest millions of dollars in large-scale
ERP systems."
"This past fiscal year was a difficult one for us, but we are
entering the new year with a positive outlook about the long-term
future of our business," said Mr. Durlow. "We successfully implemented
a restructuring plan during the fourth quarter that has brought our
costs back to a manageable level and enables us to move toward
profitability without sacrificing important sales, marketing and
product development initiatives. The full impact of the restructuring
plan will be apparent starting the first quarter of fiscal 2000. With
cash balances of $53 million at the end of this fiscal year, we have a
strong balance sheet and the resources to continue extending our
presence in the supply chain execution marketplace.
"We also saw some important signs of progress this quarter. We
closed three important license deals outside of the CPG space. One is
a significant expansion within an existing customer and two are newly
acquired clients, including our first in Germany. In addition, we
closed a number of smaller contracts for specific components such as
our advanced warehouse management solution," added Durlow. "We also
continue to bring clients live. Installations completed this quarter
include several Kellogg's divisions, Darigold, and Effem Foods. In
Europe, we also went live at Hakon, one of Norway's largest
retailers."
"Our business this quarter reflects the opportunities to come,"
continued Durlow. "We used to sell one or two very large license deals
per quarter. Now we see a mix of large and small deals along with
repeat orders from existing clients. We expect our business in FY 2000
to reflect the same as we offer customers a combination of smaller
additive solutions and large enterprise-wide applications. Our sales,
marketing and product development strategies have shifted to support
this change as well."
In an upcoming announcement, IMI will introduce a new software
suite of global fulfillment and customer service solutions for
e-commerce. "This new product suite positions IMI to be a leader in
the e-commerce revolution and it is the cornerstone of our strategy
for the future," said Durlow. "Previously, IMI sold a fully integrated
solution with a multi-million dollar price tag. Over the past two
years, we have been breaking the solution down into individual
components such as advanced order management, developing brand new
components, and integrating additional components like our recently
acquired Customer Relationship Management products. We have combined
these capabilities to deliver the advanced fulfillment and service
capabilities required by e-commerce.
"We are supporting this introduction with an aggressive
promotion campaign and we will focus our sales efforts on the
distinctive business needs of our target markets. We anticipate
selling specific components such as our advanced warehouse management
system to durable goods manufacturers that have fast moving, high
volume order fulfillment requirements. At the same time, we will
continue to sell our integrated product suite to companies operating
out of many different locations with complex logistics requirements
such as wholesalers, retailers and third-party logistics providers."
Industri-Matematik International Corp. provides high-performance
fulfillment and customer service software solutions for e-commerce.
The company specializes in pull-driven supply chain environments with
complex logistics, information-rich high transaction volumes and
rigorous demands for customer responsiveness. Industri-Matematik has
implemented enterprise systems worldwide at market-leading
organizations such as British Airways, Campbell Soup, Canadian Tire,
Canon, Carlton & United Breweries, Hartz Mountain, Kellogg's, Skyway
Systems, Starbucks, VWR and Warner/Elektra/Atlantic.
The statements contained in this release that are not historical
facts contain forward-looking information with respect to plans,
projections or future performance of Industri-Matematik and further
versions of System ESS (R), the occurrence of which involve certain
risks and uncertainties, including, but not limited to, product demand
and market acceptance risks, the effect of economic conditions, the
impact of competitive products and pricing, product development,
commercialization and technological difficulties and other
uncertainties detailed in Industri-Matematik's filings with the
Securities and Exchange Commission, particularly the Form 10-K filed
in July 1998.
Editors: For Industri-Matematik company and product information,
and press releases, access the Industri-Matematik site on the World
Wide Web at im.se.
-0-
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INDUSTRI-MATEMATIK INTERNATIONAL CORP. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(U.S. Dollar in thousands)
04/30/99 04/30/98
(unaudited)
ASSETS
Current assets:
Cash and cash equivalents 29,065 41,982
Short-term investments 24,848 69,416
Accounts receivable, less
allowance for doubtful
accounts 23,772 24,289
Contract receivables 703 2,034
Prepaid expenses 2,742 2,824
Income taxes receivable 733 402
Other current assets 558 647
Total current assets 82,421 141,594
Non current assets:
Property and equipment, net 6,682 5,011
Deferred income taxes 16,042 5
Goodwill 9,084 1,002
Other non current assets 856 1,717
Total non current
assets 32,664 7,735
Total Assets 115,085 149,329
LIABILITIES AND SHAREHOLDER'S
EQUITY
Current liabilities:
Current portion of capital
lease obligations 110 274
Current portion of notes
payable 534 486
Accounts payable 3,177 2,439
Accrued expenses and other
current liabilities 11,959 6,016
Accrued payroll & employee
benefits 7,137 5,938
Deferred revenue 5,317 5,962
Total current
liabilities 28,234 21,115
Long-term liabilities:
Capital lease obligations 0 281
Notes payable 303 840
Accrued pensions liability 2,476 2,132
Other long-term liabilities 191 388
Total long-term
liabilities 2,970 3,641
Total liabilities 31,204 24,756
Shareholders' equity:
Common Stock 315 329
Additional paid-in capital 123,945 127,886
Retained earnings (29,972) 5,287
Cumulative translation
adjustment (3,514) (2,426)
Note receivable from
stockholders (6,893) (6,503)
--------- -----------
Total shareholders'
equity 83,881 124,573
Total Liabilities and
Shareholders' Equity 115,085 149,329
INDUSTRI-MATEMATIK INTERNATIONAL CORP. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
(Unaudited)
(U.S. Dollar in thousands, except per share data)
Twelve Months Ended Three Months Ended
04/30/99 04/30/98 04/30/99 4/30/98
Revenues:
Licenses 17,039 36,090 2,572 8,882
Services and
maintenance 68,233 57,632 17,055 19,729
Other 1,696 1,662 442 881
Total revenues 86,968 95,384 20,069 29,492
Cost of revenues:
Licenses 2,212 790 875 374
Services and
maintenance 68,670 41,826 15,820 14,279
Other 752 1,029 115 547
Total cost of
revenues 71,634 43,645 16,810 15,200
Gross profit 15,334 51,739 3,259 14,292
Operating expenses:
Product Development 24,267 14,684 5,880 5,256
Acquired In-process
Research and
Development 2,500 0 0 0
Sales and marketing 27,295 20,878 6,928 6,733
General &
administrative 12,332 6,989 3,181 1,948
Amortization of
goodwill 486 114 293 28
Restructuring costs 3,522 0 3,522 0
Total operating
expenses 70,402 42,665 19,804 13,965
Income (loss) from
operations (55,068) 9,074 (16,545) 327
Other income (expense):
Interest income 4,446 3,490 725 1,673
Interest expense (128) (123) (16) (44)
Miscellaneous income
(expense) (931) (286) (960) (164)
--------------------------------- --------
Income (loss) before
income taxes (51,681) 12,155 (16,796) 1,792
Provision (benefit)
for income taxes (16,422) 2,762 (5,201) 360
Net income (loss) (35,259) 9,393 (11,595) 1,432
Net income (loss) per share
- assuming dilution ($1.09) $0.30 ($0.36) $0.04
Weighted average number of
shares outstanding
- assuming dilution 32,431,260 30,820,530 31,833,663 33,008,899
*T
--30--sw/ny*
CONTACT: Company Contact:
Industri-Matematik International Corp.
Stig Durlow, e-mail: stdu@im.se
Lars-Goran Peterson, email: lgpe@im.se
phone: +46 8 676 5000
or
Contact:
Lippert/Heilshorn & Associates
John Heilshorn, email: john@lhai.com
Jody Burfening, email: jody@lhai.com
phone: 212/838-3777 |
