Ascential Software Corporation Reports Second Quarter Results
Ascential Revenue on Continuing Products Increases 113% from Last Year and 20% Sequentially
biz.yahoo.com
WESTBORO, Mass.--(BUSINESS WIRE)--July 24, 2001--Ascential(TM) Software Corporation (NASDAQ: ASCL - news), the leading provider of Information Asset Management solutions, today announced results for the second quarter ended June 30, 2001.
As previously announced, Informix Corporation sold the assets of its database business, Informix Software, to the IBM Corporation (NYSE: IBM - news) in an all cash transaction for $1.0 billion on July 1, 2001. Subsequent to closing of the transaction, Informix Corporation was renamed Ascential Software Corporation and the company's stock is now traded under the Nasdaq ticker symbol ``ASCL.''
Revenue for the company, excluding revenue from the database operations purchased by IBM, increased 10% to $36.5 million from $33.3 million in the first quarter ended March 31, 2001, and 28% from $28.5 million in the second quarter of 2000. Excluding the contribution from its i.Sell product offering which was discontinued in the first quarter of 2001, revenue increased 20% on a sequential basis from $30.4 million and 113% from $17.1 million in the second quarter of 2000.
``We are pleased with our performance in the second quarter, particularly in light of the economic slowdown that is affecting virtually all software companies,'' said Peter Gyenes, Chairman and Chief Executive Officer. ``We believe our 20% growth from the first quarter on continuing products, in contrast to the declines experienced by other companies in our sector, signifies that we are gaining share of the Information Asset Management market. The growth of our DataStage® and Media360TM offerings is driven by the growing requirement for corporations today to turn vast amounts of data and content of any kind, both structured and unstructured, into reusable, valuable information assets. New strategic alliance agreements that we signed during the second quarter with IBM, SAP, KPMG Consulting, Inc., and Business Objects are further testimony to the increasing market recognition our products are receiving.
``Ascential starts its life as a public company in a position of strength on all fronts,'' continued Mr. Gyenes, ``Our products enjoy a first-class reputation for delivering on their promises, our management team and employees are experienced and talented, and our substantial cash position gives us the financial resources to pursue all our goals including improving our market leadership position in the Information Asset Management arena.''
Revenue of the former Informix Corporation, including revenue for Ascential Software and Informix Software, was $208.6 million in the second quarter as compared to $240.5 million in the prior year period.
Earnings per share for the former Informix Corporation were $0.03 in the second quarter, excluding charges and items related to merger, realignment, amortization of goodwill and intangibles. Earnings per share in the prior year period on a comparable basis were also $0.03. Including those items, loss per share was $0.03 in the current period versus earnings per share of $0.02 per share in the prior year period.
Ascential Software expects to incur charges and transition expenses in the third quarter and to a lesser extent in the fourth quarter, mostly related to the sale of the Informix database business to IBM. The aggregate amount of these items is expected to be approximately $10 to $15 million in non-cash charges and approximately $45 to $50 million in cash charges (as previously announced).
During the second quarter Ascential's management team was further strengthened. Robert C. McBride was appointed chief financial officer of Ascential Software Corporation. Previously he held senior financial management positions with Data General, now a division of EMC Corp. James Vedda joined the company as vice president of worldwide sales, with the responsibility to lead the Company's direct and indirect global sales forces throughout the Americas, Europe and Asia. Mr. Vedda was previously in worldwide sales management positions at Mirror-Image Internet and Parametric Technologies.
During the second quarter the Company repurchased 6,060,000 shares at an average price of $4.94 as part of its $350 million repurchase program. As of June 30, there were 283,105,075 shares outstanding.
Selected Quarterly Highlights
During the second quarter of 2001, Ascential Software extended its reach into the Information Asset Management market, establishing and expanding key strategic partnerships, signing new customers, and strengthening its product portfolio.
Highlights of the quarter include:
Ninety-four new customers worldwide, including: Shell Oil, Navigation Canada, State of New Jersey, BASF, Amcor, Nestle, Experian, State of Florida, Eye2Buy Technology, Dominion Resources, Lotto Quebec and Royal & Sun Alliance PLC, among others. Experian, State of New Jersey and Sherwin Williams add to the list of organizations that have standardized on DataStage as their enterprise Information Asset Management platform. These organizations join the Company's existing customer list, which includes American Express Company, Anheuser-Busch, AT&T, BBC Worldwide, Boeing Company, Canadian Broadcasting Corporation, Cisco Systems, CNN, Deutsche Bank, General Motors, GlaxoSmithKline, Hartford Life, Kraft Foods, Mobil Oil, Northwest Airlines, Novo Nordisk, PepsiCo, and Pfizer Inc.
Worldwide reseller agreements with IBM, SAP, and Business Objects
IBM, under a strategic alliance, will sell and market Ascential's DataStage and Media360 products as preferred complementary solution offerings in the data warehouse and media markets, respectively.
SAP AG, under a three-year strategic global reseller agreement, will resell DataStage as the data integration platform for all SAP Business Intelligence customers. In support of this partnership Ascential also introduced a specialized version of DataStage targeted for SAP environments.
Business Objects will integrate and resell DataStage with the BUSINESSOBJECTS(TM) Application Foundation, its new analytic applications framework.
Expanding the penetration of Media360 in non-broadcast markets with sales to ACI Glass Packaging, a Division of Owens Illinois, Universitet 1 Bergen (Norway) and the U.S. Marshals Service. The company also saw continued adoption of Media360 in its traditional market segments with sales to Promovisa, Williams Communications, and Eye2Buy Technology, among others.
Delivering several new modules for Media360 - including the Desktop Publishing Module v2.0, Web Publishing Module v2.0 and Image Module v2.0 - that target news, publishing and image-intensive organizations.
Signing a strategic partnership agreement with KPMG Consulting, Inc. and launching a joint marketing initiative to deliver Media360 to clients in KPMG's Digital Content Management practice.
Delivering new versions of Ascential's industry leading data integration (DataStage XE v4.2), metadata management (MetaStage v2.1) and data quality (Quality Manager v4.8) tools, with expanded features to integrate business intelligence environments with corporate portals, support very large warehouse environments, and extend support for international languages.
Continuing strong adoption of Ascential's data integration products for high scalability IBM mainframe data warehouse environments. New customers purchasing DataStage/390 include EDS, KLV (Karlsruher Lebensversicherung), Dominion Resources, and the State of New Jersey.
Expanding the list of customers using Ascential solutions to integrate data from SAP with their overall corporate information environment by signing Shell Oil, Samsung, and SC Johnson.
Outlook
``Although our business continues to be characterized by a strong pipeline and high level of customer activity, a discernable slowdown in IT spending makes us cautious looking out over the near term,'' commented Pete Fiore, President of Ascential Software. ``As a result we are projecting that third quarter revenue will be approximately flat with that of the second quarter. During the fourth quarter, we expect our alliances with IBM, SAP, and Business Objects to begin to gain traction, contributing to solid sequential growth over the third quarter revenue level. This would represent revenue growth for this year of about 25%, or approximately 60% excluding discontinued i.Sell revenues.
Mr. Fiore continued, ``Our worldwide sales and services organization, complemented and supported by our strategic alliances, positions us very well to successfully exploit opportunities in this difficult environment and capitalize on any cyclical upturn in demand. We continue to strengthen our readiness, and expect to see significant improvement in business when IT spending again turns up. Our business model is structured to achieve sustainable operating profitability, before charges, at a quarterly revenue level of approximately $48 million, a level we expect to achieve in the first quarter of 2002.
``Based on indications from our customers, partners and prospects we are planning our business around revenue growth of approximately 40% in 2002. Next year's growth, however, could vary over a wide range due to the timing of an anticipated IT spending turnaround, and we are positioned to support higher levels of growth if it materializes. This keeps us on track to achieve our long term target model of 17% to 25% operating margins, based on revenue levels anticipated by the latter part of 2003,'' concluded Mr. Fiore.
Conference Call
Management will host a conference call at 5:00 PM (EDT) today to discuss the Company's operating performance. The conference call will be broadcast live through a link on the Investor Relations page on the Ascential web site at www.ascentialsoftware.com/investors. Please go to the web site at least fifteen minutes prior to the call to register, download and install any necessary audio software.
For those who cannot attend the live broadcast, a replay will be available on the web site at www.ascentialsoftware.com or by calling 402-530-7976 from two hours after the call ends until 5:00 p.m. on July 31, 2001. |
