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Technology Stocks : Corel - Investors with no Humor -- Ignore unavailable to you. Want to Upgrade?

To: micromike who wrote (353)	1/20/1998 9:40:00 PM
From: A. Reader	Respond to of 1094

JANUARY 20, 1998 Corel Announces Fourth Quarter 1997 Results Restates First Three Quarters (Part I of V) OTTAWA, ONTARIO--Today, Corel Corporation released its 1997 fourth quarter financial results and results for its fiscal year ended November 30, 1997. (All the financial information is expressed in U.S. currency.) Revenues for the fourth quarter were $43.6 million, and for the full year were $260.6 million. The Company's net loss for the 1997 fiscal year was $231.8 million or $3.34 per share (fully diluted), which corresponds with the aggregate of the previously reported results for the first three quarters and the estimated loss for the fourth quarter of $95 million announced on December 18, 1997. That estimate included a write-off of approximately $28 million relating to the unamortized balance of costs of certain JAVA technologies acquired through technology exchange transactions during the first three quarters of fiscal 1997. The result actually reported for the fourth quarter is a loss of $67 million, or $1.00 per share (fully diluted). This differs from the $95 million estimate because the revenues and the related amortization of costs previously reported for the JAVA technologies exchange transactions will be eliminated in the audited financial statements for the year, thereby eliminating the $28 million write-off in the fourth quarter. The accounting treatment of these transactions in the first three quarters was considered appropriate at the time. The treatment now adopted results from further consideration by the Company's auditors in connection with the year-end audit. Applying this treatment for the first three quarters results in reductions in revenues of $13 million, $13 million and $7 million, producing losses of $11.3 million, $117.6 million and $35.9 million in the first, second, and third quarters, respectively. The quarterly results as reported for the first three quarters are restated accordingly. The full effects of the restatement are set out in detail in the financial summaries released today. As previously estimated, actual fourth quarter results indicate the Company's cash position increased during the fourth quarter by more than $8 million to $30.6 million in cash and short-term investments. At the same time, current liabilities have remained reasonably constant relative to the fourth quarter of fiscal 1996 while long-term debt relating to the acquisition of WordPerfect technologies continues to decline. The Company has not borrowed or required any additional financing throughout fiscal 1997. The carrying value of the Company's inventories at the end of the fourth quarter of fiscal 1997 has been reduced by more than 60 percent from its level at the end of the fourth quarter of fiscal 1996. Dr. Michael Cowpland, president and CEO commented: "While the results for the 1997 fiscal year are disappointing, the Company remains strong and well positioned for a successful 1998. In our continuing focus on core products, the Company divested a number of product categories in 1997 that did not directly support our key graphics and business productivity software lines. We see this as enhancing our ability to provide approximately 25 million users of CorelDraw and of the WordPerfect family of products with the most effective graphics and office productivity tools available. Our products continue to be well received in the marketplace. We are convinced that this strategy will keep us on the competitive edge, particularly in our growing corporate licensing market. Further, our significant ongoing investment in Java is now bringing us very close to the start of a new era in Webtop computing, that combines the power of Java, dynamic HTML and XML. As many leaders in our industry are acknowledging, the emergence of this new type of technology may be one of the most compelling events on the 1998 horizon and we are very excited about being at the forefront."