Boy does this REEK of total manipulation....
Uh gee guys this stock was in the 20s last week and now it's flying and we're not in yet. Lets downgrade it, load the boat and then say oops did we say BEAS? Oh we made a mistake.
Interesting how it took a WEEK to issue a corrected press release. Another Wall Street firm joins the growing list of firms of ill repute, the freakin' criminals <g>
Fri, Apr 20, 2001, 9:35 AM
A news story was just released for BEAS.
===========================================================================
CORRECTS FROM APR 12: Vignette, not BEA Systems, lowered view
In the April 12 article, "Art Technology takes necessary steps to revamp
operations," one of Art Technology Group Inc.'s largest competitors, BEA
Systems Inc., was reported to have lowered its earnings guidance. It was
competitor Vignette that had recently trimmed its financial guidance, along
with Art Technology and BroadVision Inc.
The following is a corrected version of the story.
Art Technology takes necessary steps to revamp operations --
By Cheri Paquet McLane
Boston, April 12 (BridgeNews) - Art Technology Group will reduce its
headcount, consolidate real estate, trim salaries and reduce its consulting
contracts in a move to get back on the road to profitability, company
officials
said Thursday. These cost-saving measures are a few necessary steps Art
Technology must take to enhance its competitive position after the industry
rebounds, according to industry watchers.
* * *
During the past several years, the booming software industry required
companies to hire in anticipation of growth, since it generally takes
several
months to get new hires fully up to speed.
With today's slowed demand for software, many companies are faced with
having to downsize operations to remain profitable.
In the case of Art Technology, the company eliminated every dollar
elsewhere -- real estate, salary reductions -- in order to meet their
numbers
with as few staff reductions as possible, according to Legg Mason analyst
Paul
Krieg. "This is a needed step for Art Technology."
The Cambridge, Mass.-based company announced Thursday it is eliminating
12%, or 150 employees, of its work force in a move to realign expenses and
revenues. Moreover, Art Technology plans to consolidate real estate, slash
salaries and reduce consulting contracts. As part of its cost-reduction
plan,
Art Technology will incur a one-time charge in the second quarter of 2001.
Art Technology stock jumped 8.08% to trade at 5.62 on the news Thursday.
It's the overall industry, not the company, which is not on track,
according to Krieg. Art Technology, BroadVision Inc. and BEA Systems Inc.
and
are the primary application vendors in market. Art Technology and
BroadVision,
along with indirect competitor Vignette Corp., each significantly reduced
first
quarter guidance from what expectations were six months ago.
The industry has changed so much, practically every company is forced to
make changes, and Art Technology's lay-offs are significantly less than
competitors, he said.
The slowdown in the software industry has every company redefining itself.
Art Technology must continue to sign deals that prove its leadership, so
that
when demand rebounds, it is in the forefront, said Krieg.
Thursday's announcement didn't surprise First Union Securities Inc. analyst
Jason Maynard, given the state of the market. Art Technology's lowered first
quarter guidance, announced almost two weeks ago, also set the stage for
Thursday's cutbacks.
Art Technology expects to report a loss of 19 cents to 22 cents a share on
revenues of $40 million to $42 million for its first quarter, company
officials
announced April 2. The company attributed the downward guidance to ongoing
weakness in the economy and delayed projects.
Art Technology's new revenue and earning numbers where dramatically lower
than his estimates, said Maynard, adding that he had downgraded the stock to
hold a month earlier.
You're seeing companies putting in cost control measures to get their
operating line more in line with the reality of the lowered revenue
expectations, Maynard said. "This is not a new thing--companies across the
board are reducing their headcount."
Still Maynard said he thinks Art Technology is in a tough competitive
position right now. Art Technology still is not "clearly-defined as
full-blown
application company," he said. Art has good commerce and personalization
products, according to Maynard, but companies are looking to standardize
their
architecture and Art's application server is "dragging down its business."
Art's application server does not support competing products, nor do its
commerce and personalization applications run natively on other servers, he
said.
Today, companies are going with leading market share vendors, Maynard said,
and the question remains whether Art Technology will decide to support
others'
products.
In Art Technology's upcoming earnings call, scheduled for April 26, Maynard
said that Art's business in the month of April would be a key indication of
the
company's health. Specifically, he'll be listening for whether or not
pushed-out deals came back and if the company has improved visibility on
converting customers to paying customers, he said.
While Maynard said he thinks that Art's challenges are both industry-wide
and company-specific, Legg Mason's Krieg said he thinks Art will be
positioned
to bounce back when the market does.
Going forward, Krieg said he would look for detail on specifically where
the company plans to cut costs and how many millions will come out of its
budget as a result. Also in Art's upcoming call, Krieg anticipates the
company
will discuss how much the restructuring will cost and what the company's
revenues will look like going forward. |
