General Magic Announces Fourth Quarter and Year-end 2000 Results
(PR Newswire 03/07 16:13:34)
SUNNYVALE, Calif., March 7 /PRNewswire/ -- General Magic, Inc.,
(Nasdaq: GMGC), a leading provider of voice application services, today
announced its operating results for the fourth quarter and year ended
December 31, 2000.
Kathie Layton, newly appointed chief executive officer and president of
General Magic said, "We are sharpening our focus and implementing an
aggressive business strategy that capitalizes on our technology and
application expertise and the growing voice market opportunities." Ms. Layton
continued, "We have taken the steps we believe necessary to produce
sustainable, long-term profitable growth, and with the recent streamlining
activities, we have now aligned our organizational assets to help achieve our
goals."
Financial Results
Revenue for the fourth quarter ended December 31, 2000, was $2.6 million,
an increase compared to $436 thousand in the fourth quarter of 1999. The
Company incurred a net loss of $8.0 million, or $0.13 per diluted share, in
the fourth quarter of 2000, an improvement compared to a net loss of
$22.9 million or $0.55 per diluted share, in the fourth quarter of 1999. The
net loss for the fourth quarter of 2000 included an $81 thousand non-cash
adjustment to accumulated deficit related to dividends on preferred stock,
compared to a $12.0 million non-cash adjustment, or $0.29 per share, related
to dividends on preferred stock and issuances of preferred stock and warrants
with favorable conversion and redemption rights during the same period of
1999. Excluding the effect of one-time, non-cash adjustments associated with
losses on impaired investments and non-cash adjustments for preferred stock,
the Company incurred a net operating loss of $6.2 million, or $0.13 per share,
for the fourth quarter 2000 compared to $10.9 million, or $0.26 per share, for
the same period in 1999.
Revenue for the twelve months ended December 31, 2000, was $10.7 million,
compared to $2.5 million for the twelve months ended December 31, 1999. The
Company incurred a net loss of $42.9 million, or $0.77 per diluted share, for
the twelve months ended December 31, 2000, compared to a net loss of $61.2
million, or $1.56 per diluted share, for the twelve months ended December 31,
1999. The net loss for the twelve months of 2000 included a $7.8 million
non-cash adjustment, or $0.14 per share, to accumulated deficit related to
dividends on preferred stock and issuances of preferred stock and warrants
with favorable conversion and redemption rights, compared to a $13.6 million
similar adjustment, or $0.35 per share, in the same period of 1999. Excluding
the effect of one-time non-cash adjustments associated with losses on impaired
investments, non-cash adjustments for equity in the net losses of investments,
and non-cash adjustments for preferred stock, the Company incurred a net
operating loss of $32.3 million, or $0.58 per share, for the twelve months of
2000 compared to $47.6 million, or $1.22 per share, for the same period in
1999.
Operating expenses for the fourth quarter of 2000 were $8.5 million
compared to $12.0 million for the fourth quarter of 1999. For the twelve
months ended December 31, 2000, operating expenses were $43.6 million,
compared to $48.0 million for the same period in 1999.
For the twelve months ended December 31, 2000, the Company recognized an
impairment loss of $2.8 million reflecting the balance of its total
investments in Conita Technologies, Inc. and ICRAS Inc., formerly known as
DataRover Mobile Systems, Inc.
Cash and short-term investments totaled $19.0 million as of December 31,
2000, compared to $25.5 million as of December 30, 1999. As of December 31,
2000, there were 64.8 million shares of common stock outstanding.
Raising Additional Capital
On September 14, 2000, the Company announced an equity financing
arrangement under which the Company intends to offer General Magic common
stock for aggregate proceeds of up to $45 million. To date the Company has
raised approximately $13.3 million through the Ladenburg Thalman arrangement.
These securities may be offered from time to time on behalf of General Magic
by the investment banking firm of Ladenburg Thalmann & Co. on a best efforts
basis. General Magic will have full control over the price and terms of any
sale and is under no obligation to sell any shares.
Company Update
On February 21, 2001, General Magic announced the delivery of the initial
feature set for OnStar's Virtual Advisor(TM). General Magic was selected by
OnStar to design and host the Virtual Advisor because of its innovative and
sophisticated technology, voice user interface (VUI) design expertise, and
state-of-the-art scaleable voice platform and hosting facilities. The OnStar
Virtual Advisor provides drivers with access to a personalized, voice-
activated, in-vehicle connection to e-mail, sports scores, stock quotes, news
and weather, simply and easily, with no screens or displays. OnStar will
complete its national rollout of Virtual Advisor this spring.
About General Magic
General Magic is a voice application service provider dedicated to
delivering customized voice applications, hosting, and professional services
to leading telecommunications, enterprise and Internet companies. With its
award-winning VoiceXML-based magicTalk communications platform and years of
experience, General Magic offers the premier voice user interface that
combines language, personality, and logic, creating a natural conversation
between people and information. General Magic creates value for its customers
by building voice solutions that strengthen customer relations, deliver value-
added services, and provide access to content anytime, anywhere. General
Magic is headquartered in Sunnyvale, California. For additional information
about General Magic, visit the company's web site at
generalmagic.com .
General Magic notes that the forward-looking statements in this press
release involve known and unknown risks, uncertainties and other factors that
may cause industry trends, or actual results, performance or achievement to be
materially different from any future trends, results, performance or
achievements expressed or implied by these statements. These include, among
others, risks and uncertainties concerning the adequacy of the Company's
financial resources to execute its business plan; market acceptance of the
Company's technologies and services; the Company's ability to attract, retain
and motivate key technical, marketing and management personnel; the ability of
the Company to establish and maintain relationships with businesses that have
high volume customer interactions, and to establish alliances with companies
that offer technology solutions for such businesses; the challenges inherent
in the development, delivery and implementation of complex technologies; the
ability of the Company's third party technology partners to timely develop,
license or support technology necessary to the Company's services; and the
Company's ability to respond to competitive developments. These and other
risks and uncertainties are detailed in General Magic's Registration Statement
on Form 10-Q filed with the Securities and Exchange Commission on November 14,
2000.
General Magic and magicTalk are trademarks of General Magic, Inc., which
may be registered in some jurisdictions.
GENERAL MAGIC, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except per share amounts)
ASSETS
December 31,
2000 1999
Current assets:
Cash and cash equivalents $12,344 $23,045
Short-term investments 6,700 2,490
Other current assets 2,671 767
Total current assets 21,715 26,302
Property and equipment, net 8,761 11,869
Other assets 497 3,534
Total assets $30,973 $41,705
LIABILITIES AND STOCKHOLDERS' (DEFICIT) EQUITY
Current liabilities:
Accounts payable $1,888 $2,780
Accrued expenses 3,763 8,018
Deferred revenue and other current liabilities 280 5,895
Total current liabilities 5,931 16,693
Other long-term liabilities 2,161 2,692
Total liabilities $8,092 $19,385
Commitments
Redeemable, convertible Series D preferred
stock, $0.001 par value Stated at involuntary
liquidation preference; Authorized: 2 shares;
issued and outstanding: 2000 -- 0; 1999 -- 1 $2,023 $10,274
Stockholders' (deficit) equity:
Convertible preferred stock, $0.001 par value
Authorized: 482 shares; issued and outstanding:
2000 -- 55; 1999 -- 53 2 2
Common stock, $0.001 par value; authorized:
150,000 shares; Issued and outstanding:
2000 - 64,814; 1999 -- 43,248 65 43
Additional paid-in capital 334,544 282,861
Accumulated other comprehensive loss (3) (3)
Accumulated deficit (313,547) (270,654)
21,061 12,249
Less treasury stock, at cost:
2000 - 46; 1999 - 46 (203) (203)
Total stockholders' (deficit) equity 20,858 12,046
$30,973 $41,705
GENERAL MAGIC, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
Years Ended December 31,
2000 1999 1998
Revenues:
Service revenue $10,570 $914 $119
Licensing revenue 57 1,563 1,610
Other revenue 47 7 557
Total revenue 10,674 2,484 2,286
Costs and expenses:
Cost of revenue 4,538 195 363
Network operations 9,068 7,387 3,405
Research and development 5,846 12,071 16,022
Selling, general and
administrative 17,834 22,976 20,642
Depreciation and
amortization 6,102 4,902 3,044
Write-off of acquired
technology and in-process
research and development - - 2,827
Compensation expense related
to stock options 172 453 1,634
Total costs and expenses 43,560 47,984 47,937
Loss from operations (32,886) (45,500) (45,651)
Other income (expense), net (2,182) (2,052) 6,762
Loss before income taxes (35,068) (47,552) (38,889)
Income taxes 38 23 19
Net loss (35,106) (47,575) (38,908)
Favorable conversion rights
on convertible Series A
preferred stock - - (3,665)
Favorable conversion and
redemption rights on
redeemable, convertible
Series B preferred stock,
favorable exercise rights
on warrants and preferred
stock dividend - (112) (8,352)
Favorable redemption rights
on redeemable, convertible
Series C preferred stock
and preferred stock dividend - (522) (10,858)
Favorable redemption rights
on redeemable, convertible
Series D preferred stock
and preferred stock dividend (160) (602) -
Favorable redemption rights
on redeemable, convertible
Series F preferred stock
and preferred stock dividend (260) (609) -
Favorable conversion rights
on convertible Series G
preferred stock - (11,734) -
Favorable redemption rights
on redeemable, convertible
Series H preferred stock (7,366) - -
Loss applicable to common
stockholders $(42,892) $(61,153) $(61,783)
Basic and diluted loss
per share $(0.77) $(1.56) $(2.09)
Shares used in computing
per share amounts 55,441 39,098 29,630
Net loss applicable to common shareholders for the year ended December 31,
2000 includes the net loss for the period and $7.8 million in adjustments
to accumulated deficit related to dividends on preferred stock and
issuances of preferred stock and warrants with favorable conversion and
redemption rights during the period. Net loss applicable to common
shareholders for the year ended December 31, 1999 includes the net loss
for the period and $13.6 million in adjustments to accumulated deficit
related to dividends on preferred stock and issuances of preferred stock
and warrants with favorable conversion and redemption rights during the
period. Net loss applicable to common shareholders for the year ended
December 31, 1998 includes the net loss for the period and $22.9 million
in adjustments to accumulated deficit related to dividends on preferred
stock and issuances of preferred stock and warrants with favorable
conversion and redemption rights during the period.
SOURCE General Magic, Inc.
-0- 03/07/2001
/CONTACT: Laura Crowley, 408-774-4457, or Gina Tetreault, 408-774-4420,
ir@generalmagic.com , both of General Magic, Inc./
/Web site: generalmagic.com /
(GMGC) |
