Wednesday October 18, 4:21 pm Eastern Time
Press Release
Informix Corporation Announces Third Quarter 2000 Results
-- Revenues and Operating Loss Consistent with Recent Guidance -- Implementing Recently Announced Organizational Realignment -- Profitability expected in the fourth quarter, 2000
WESTBORO, Mass.--(BUSINESS WIRE)--Oct. 18, 2000-- Informix Corporation (Nasdaq: IFMX - news) a technology leader for the new economy, today reported results for the third quarter ended September 30, 2000.
Revenue for the third quarter totaled $211.1 million, compared with $261.1 million in the same quarter last year. Included in third quarter 2000 results were charges of $67.2 million, mostly related to the Company's previously announced plans to establish two separate, independent operating companies focused on database and e-Business solutions, respectively. Before these charges, the net loss for the quarter was $18.5 million, or $(0.06) per diluted share, compared to net income in the 1999 third quarter of $25.8 million, or $0.09 per diluted share. Including these charges, Informix reported a net loss of $85.7 million, or $(0.30) per diluted share.
Revenues of the newly-formed Solutions business were $28.9 million, compared with $23.7 million in the same period of 1999, and grew sequentially at a 52% annualized rate from $25.6 million in the second quarter of 2000 fueled by strong business intelligence license sales. Revenues of Informix Software, the Company's Database business, were $182.2 million in the 2000 third quarter, compared with $237.4 million in the comparable period of 1999. The bulk of this decline was in license and services revenue from traditional databases and tools associated with client-server applications, which have experienced lower demand post-Y2K. The change in currency exchange rates had approximately a $10 million negative impact on revenue as well. International sales represented 52% of the Company's revenue during the third quarter of 2000.
Peter Gyenes, Chairman and Chief Executive Officer, commented, ``Results in the third quarter came in toward the higher end of our revised expectations. As we commented previously, while we bore the burden of a post-Y2K slowdown in demand of traditional client-server products and weak foreign currencies, the primary cause of the Company's under-performance has been poor execution.''
Mr. Gyenes continued, ``Nevertheless, the third quarter represents an inflection point for Informix in our efforts to regain the Company's previous stature and momentum. During the quarter, we redefined Informix by creating separate operating companies, one dedicated to the database market and one dedicated to the e-Business solutions markets. We believe that this structure has already brought the necessary focus on each of the markets we serve and has allowed us to properly size and align our resources to maximize each company's opportunities for revenue and market share growth.''
Mr. Gyenes concluded, ``We look forward to the fourth quarter of 2000 and beyond with optimism and confidence. The markets for our high-performance enterprise database products and e-Business solutions remain very robust. With our newly re-energized organization, we expect to demonstrate sequentially improved results from the third quarter levels. Revenue growth should be generated by the improved productivity of our more focused and maturing sales forces, new product introductions, and enhanced relations with our strategic partners. Profitability is expected to rise as lower operating expenses from our right-sizing initiatives take hold. We now expect to return to profitability in the current quarter, before previously announced charges, and to continue sequential revenue and profitability growth throughout 2001. As we continue to improve the execution of our plans while communicating and demonstrating our strategies, our accomplishments, and our customer commitments to the marketplace, we expect our results to reflect the success of our actions.''
Third Quarter Highlights
Informix Corporation achieved the following during the third quarter:
Began implementing its strategy for realigning the Company. Five former business units were consolidated into two operating companies: Informix Software, which focuses on database management systems optimized for data warehousing, transaction processing, and e-Business environments; and the new Informix e-Business solutions company, to be named by year-end, which is focused on providing database and platform independent software solutions and infrastructure for the e-Business marketplace.
Announced its intention to create two publicly-traded companies from this structure.
Established a new senior management team supporting the two operating companies. Peter Gyenes and Jamie Arnold were appointed Chairman and Chief Financial Officer, respectively, of Informix Corporation, the parent company of Informix Software and the newly-created e-Business solutions company. Jim Foy and Pete Fiore were named Presidents of Informix Software and the Solutions Company, respectively. Mr. Gyenes continues in his role as President and CEO of Informix Corporation.
Entered into partnering relationships with PricewaterhouseCoopers; Compaq/Suse; Meridex; S1; i2 Technologies, and Logica.
-- Added 236 new customers.
Ended the quarter with $242.5 million in cash on its balance sheet and no debt.
Informix e-Business solutions company achieved the following during the third quarter:
Delivered Release 2.0 of the DataStage Extract PACK for SAP R/3 and added 12 new customers for the product during the quarter, including Anheuser-Busch, SC Johnson Wax, and LVMH.
LVMH and General Motors each selected DataStage as their platform for corporate-wide data integration initiatives.
Won Internet/Web product of the year for its Informix i.Sell(TM) solution, the company's complete end-to-end e-business offering, at the United Kingdom's annual Networking Awards organized by Network News and Miller Freeman.
Signed new licensing agreements with Merrill Lynch, Commerce Bank, Benetton and Bonneville Power.
Announced i.Decide(TM)Web Success(TM)the first end-to-end, business analysis solution that integrates Web data and traditional enterprise data to provide a comprehensive perspective of an e-business. Airtel is the first customer for this product.
Informix Software achieved the following during the third quarter:
Announced the newest release of XPS and set a world record with the product in the 1000GB TPC-H benchmark on a single node system, underscoring the Company's performance leadership in enterprise-wide data warehousing. The company also extended its relationships with current XPS customers including Galileo, Healtheon/WebMD and Vital Processing Services.
Announced an agreement to become a Symbian Technology partner to enable enterprise applications for the post-PC wireless age. Further, it has ported its Cloudscape(TM) database to the Symbian platform to help enable enterprise applications for users of Symbian-based Smartphones and Communicators.
Experienced strong demand from the telecommunications market with continuing sales to SBC, Motorola, Lucent, and AT&T.
Signed a contract with Nokia, the world's largest mobile communications equipment provider, and delivered the initial licenses of Informix technology, which will be embedded within Nokia's mobile infrastructure product.
Continued its penetration into the new economy with new sales of Foundation2000 at Columbia Tristar, iExchange.com, and Jackpot.com.
About Informix Software
Informix Software, an independent operating business of Informix Corporation (NASDAQ:IFMX - news), develops and markets database management systems optimized for data warehousing, transaction processing, and e-Business environments. Informix Software is developing a broad network of partner and ISV relationships to expand the portfolio of applications available on its database product line for a range of markets including wireless, e-commerce, and CRM.
About Informix Business Solutions
Informix Business Solutions, an independent operating business of Informix Corporation (NASDAQ: IFMX - news), develops and markets a suite of next generation software solutions and infrastructure for e-Business that integrate content, e-Commerce, and business intelligence. Informix Corporation intends to rename Informix Business Solutions by year end. For more information, contact the nearest sales office or see related press release ``Informix Establishes Two Independent Operating Companies,'' Sept. 19, 2000, at Informix' Web site, informix.com.
Safe Harbor Statement
This public announcement contains forward-looking statements that are subject to numerous risks and uncertainties. These forward-looking statements include, without limitation, those as to:
The Company's ability to separate its operations into two independent operating companies, hire and retain qualified personnel for both companies, and realize the anticipated profitability and resulting stockholder value of the two independent operating companies
The extent to which there will be continued strength in Business Intelligence license sales in the future
The extent to which the creation of two separate operating companies will enable the Company to properly size and align its resources to maximize both companies' opportunities for revenue and market share growth
The extent to which there will be continued strength in the markets for the Company's high-performance database products and e-Business solutions
The Company's ability to achieve sequentially improved results from the third quarter levels
The extent to which the Company's sales force will continue to mature and be able to improve productivity
The Company's ability to develop and introduce new products that are accepted by the market
The Company's ability to enhance relations with its strategic partners
The Company's ability to realize revenue growth as the result of improved productivity by a more focused and maturing sales force, new product introductions, and enhanced relations with its strategic partners
The Company's ability to reduce operating expenses to increase profitability
The Company's ability to achieve profitability, before previously announced charges, in the fourth quarter of fiscal year 2000 and continue sequential revenue growth and profitability throughout fiscal year 2001
The Company's ability to achieve improved future results by communicating its business plans and strategies
Risks and uncertainties could cause actual results and events to
differ materially from historical, anticipated or desired results
and events. Investors and potential investors carefully should
review the description of the risks and uncertainties, which,
together with other detailed information about Informix
Corporation, is contained in the periodic reports that the
Company files from time to time with the Securities and Exchange
Commission.
INFORMIX CORPORATION
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(In thousands, except per share data)
Three Months Ended
September 30,
2000 1999
---- ----
NET REVENUES
Licenses $ 82,441 $ 131,055
Services 128,664 130,069
--------- ---------
211,105 261,124
COSTS AND EXPENSES
Cost of software distribution 11,275 13,916
Cost of services 48,214 52,291
Sales and marketing 99,896 92,055
Research and development 39,878 46,109
General and administrative 29,637 22,595
--------- ---------
228,900 226,966
Operating income (17,795) 34,158
--------- ---------
OTHER INCOME (EXPENSE)
Interest income 3,587 2,983
Interest expense (70) (1,138)
Other, net (213) 907
--------- ---------
INCOME (LOSS) BEFORE INCOME TAXES,
excluding non-recurring charges (14,491) 36,910
Income taxes 4,000 10,886
--------- ---------
INCOME (LOSS), excluding
non-recurring charges (18,491) 26,024
Preferred stock dividend (15) (247)
--------- ---------
INCOME (LOSS) APPLICABLE TO
COMMON STOCKHOLDERS, excluding
non-recurring charges $ (18,506) $ 25,777
========= =========
NON-RECURRING CHARGES
Litigation settlement expense -- --
Merger, realignment and
other charges 67,236 --
Write-off of acquired
research and development -- --
NET INCOME (LOSS) APPLICABLE
TO COMMON STOCKHOLDERS $ (85,742) $ 25,777
========= =========
INCOME (LOSS) PER COMMON SHARE,
excluding non-recurring charges $ (0.06) $ 0.09
========= =========
SHARES USED IN PER SHARE CALCULATION
excluding non-recurring charges 288,189 287,183
========= =========
NET INCOME (LOSS) PER COMMON SHARE
Basic $ (0.30) $ 0.10
========= =========
Diluted $ (0.30) $ 0.09
========= =========
SHARES USED IN PER SHARE CALCULATIONS
Basic 288,189 268,636
========= =========
Diluted 288,189 289,566
========= =========
INCOME PER SHARE, excluding
non-recurring charges and
amortization of
purchased intangibles $ (0.05) $ 0.11
========= =========
Nine Months Ended
Sept. 30,
2000 1999
NET REVENUES ---- ----
Licenses $ 303,256 $ 372,836
Services 399,227 366,442
--------- ---------
702,483 739,278
COSTS AND EXPENSES
Cost of software distribution 37,338 35,888
Cost of services 144,998 156,204
Sales and marketing 306,703 273,550
Research and development 126,940 138,308
General and administrative 75,451 65,852
--------- ---------
691,430 669,802
Operating income 11,053 69,476
--------- ---------
OTHER INCOME (EXPENSE)
Interest income 10,697 8,876
Interest expense (378) (3,428)
Other, net 4,224 308
--------- ---------
INCOME (LOSS) BEFORE INCOME TAXES,
excluding non-recurring charges 25,596 75,232
Income taxes 12,018 19,539
--------- ---------
INCOME (LOSS), excluding
non-recurring charges 13,578 55,693
Preferred stock dividend (191) (829)
--------- ---------
INCOME (LOSS) APPLICABLE TO
COMMON STOCKHOLDERS, excluding
non-recurring charges $ 13,387 $ 54,864
========= =========
NON-RECURRING CHARGES
Litigation settlement expense -- 97,016
Merger, realignment and
other charges 117,270 9,317
Write-off of acquired
research and development -- 5,052
NET INCOME (LOSS) APPLICABLE
TO COMMON STOCKHOLDERS $(103,883) $ (56,521)
========= =========
INCOME (LOSS) PER COMMON SHARE,
excluding non-recurring charges $ 0.04 $ 0.21
========= =========
SHARES USED IN PER SHARE CALCULATION
excluding non-recurring charges 308,751 273,100
========= =========
NET INCOME (LOSS) PER COMMON SHARE
Basic $ (0.36) $ (0.22)
========= =========
Diluted $ (0.36) $ (0.22)
========= =========
SHARES USED IN PER SHARE CALCULATIONS
Basic 286,265 257,444
========= =========
Diluted 286,265 257,444
========= =========
INCOME PER SHARE, excluding
non-recurring charges and
amortization of
purchased intangibles $ 0.09 $ 0.25
========= =========
INFORMIX CORPORATION
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
ASSETS
Sept. 30, 2000 Dec. 31, 1999
CURRENT ASSETS
Cash and cash equivalents $125,607 $170,118
Short-term investments 116,896 102,469
Accounts receivable, net 205,476 266,647
Deferred income taxes 5,544 5,544
Other current assets 23,306 38,056
------ ------
Total current assets 476,829 582,834
PROPERTY AND EQUIPMENT, net 70,852 68,581
SOFTWARE COSTS, net 42,685 45,722
LONG-TERM INVESTMENTS 16,196 17,272
INTANGIBLE ASSETS, net 47,270 77,537
OTHER ASSETS 18,358 16,536
------ ------
Total Assets $672,190 $808,482
======== ========
LIABILITIES AND STOCKHOLDERS'
EQUITY
CURRENT LIABILITIES
Accounts payable $20,743 $ 30,694
Accrued expenses 49,328 58,740
Accrued employee compensation 64,084 70,875
Income taxes payable 28,009 21,803
Deferred revenue 141,741 156,182
Advances from customers 14,766 34,302
Accrued merger and
restructuring costs 40,174 8,675
Other current liabilities 591 3,878
--- -----
Total current liabilities 359,436 385,149
OTHER NON-CURRENT LIABILITIES 1,051 1,420
STOCKHOLDERS' EQUITY
Convertible preferred stock -- --
Common stock; par value 2,860 2,756
Shares to be issued for
litigation settlement 61,228 61,228
Additional paid-in capital 668,420 632,743
Accumulated deficit (368,815) (265,123)
Treasury stock (36,803) (3,163)
Accumulated other
comprehensive loss (15,187) (6,528)
-------- -------
Total stockholders' equity 311,703 421,913
------- -------
Total Liabilities and
Stockholders' Equity $672,190 $808,482
======== ========
--------------------------------------------------------------------------------
Contact:
Informix Corporation, Westboro
Tony Riggio or Paul Collins, 508/366-3888
tony.riggio@informix.com
paul.collins@informix.com
or
Morgen-Walke Associates, Inc., New York
Investor Contact:
Gordon McCoun or Stephanie Prince, 212/850-5600
Gmccoun@morgenwalke.com
Sprince@morgenwalke.com |
