Earnings are out for BORL .03 before charge. Looks great.
Borland Reports First Quarter 1998 Results
SCOTTS VALLEY, Calif., April 21 /PRNewswire/ -- Borland International,
Inc. (Nasdaq: BORL) today announced results for its first quarter ended
March 31, 1998. As of January 1, 1998, Borland changed from a fiscal year
starting April 1 to a calendar year.
All consolidated financial information and share data for the first
quarter and prior periods have been restated to reflect the acquisition of
Visigenic Software, Inc., except where noted. The acquisition was finalized
February 27, 1998 and was accounted for as a pooling of interests.
For the quarter ended March 31, 1998, Borland had net revenues of
$46.5 million, compared with net revenues of $43.4 million for the quarter
ended March 31, 1997, an increase of approximately 7 percent. Borland's
revenues from its client/server, enterprise, Internet/intranet products, and
professional services continued to rise, making up approximately 67 percent of
revenues in the quarter ended March 31, 1998, compared with 51 percent in the
same quarter a year ago.
In the quarter ended March 31, 1997, prior to the acquisition of
Visigenic, Borland reported standalone revenues of $37.2 million, compared
with $46.5 million for the quarter ended March 31, 1998, which includes the
results of Visigenic -- a 25 percent increase.
Revenues from sales within the United States accounted for 50 percent in
the quarter ended March 31, 1998, compared with 57 percent in the same quarter
a year ago.
On a pro-forma operating basis--which eliminates restructuring,
non-recurring, and acquisition charges for both periods -- Borland had a
pro-forma operating profit of $1.6 million in the quarter ended
March 31, 1998, compared with a pro-forma operating loss of $21.8 million in
the same quarter a year ago. The pro-forma operating earnings per share were
$0.03, both basic and diluted, in the quarter ended March 31, 1998.
Net loss for the quarter ended March 31, 1998 was $13.4 million and
included a restructuring and acquisition charge of $19.3 million and a tax
benefit of $3.8 million. Net loss decreased approximately 70 percent from a
net loss of $44.5 million in the same quarter a year ago.
Basic and diluted loss per share was $0.27 for the quarter ended
March 31, 1998, compared with a basic and diluted loss per share of $0.92 for
the same quarter a year ago. Common shares outstanding were 50.9 million for
the quarter ended March 31, 1998, compared with 48.3 million common shares
outstanding in the same quarter last year. In connection with the acquisition
of Visigenic, approximately 12.1 million shares of Borland common stock were
issued to holders of Visigenic stock.
Results for the quarter ended March 31, 1998 and the same quarter a year
ago both reflect restructuring charges and non-recurring items. In the
quarter ended March 31, 1998, Borland had a restructuring charge of
$19.3 million as a result of the acquisition of Visigenic and a restructuring
of operations. Borland also had a non-recurring tax benefit of $3.8 million
in the last quarter. The tax benefit is associated with the conclusion of
certain outstanding federal tax issues that were under audit for the tax years
from 1984 through 1992. The resolution of these issues has resulted in a
reversal of previously provided tax reserves for such years. In the same
quarter a year ago, Borland recorded a restructuring and non-recurring charge
totaling $23.1 million related to a worldwide restructuring and realignment of
operations aimed at returning the company to profitability.
Cash, cash equivalents, and short-term investments as of March 31, 1998
were $93.8 million, compared with $74.0 million a year ago.
"Our first quarter was highlighted by the continued expansion of our
enterprise business," said Del Yocam, chairman and CEO, Borland International.
"In addition to our acquisition of Visigenic Software, we delivered a series
of new products aimed specifically at the enterprise market, including
JBuilder(TM)/400, Delphi(TM)/Connect for SAP,(TM) Entera(TM) 4, VisiBroker(TM)
3.2, and Borland AppCenter.(TM) As a result of these and other efforts, our
client/server, enterprise, Internet/intranet, and professional services
business now represents approximately 67 percent of our total revenue."
"While external factors relating to the economic crisis in Japan resulted
in a slowdown of our sales in that region, we were able to closely manage our
expenses and meet our bottom-line objectives," Yocam added.
Quarterly Highlights
During the quarter ended March 31, 1998, Borland continued to progress in
its efforts to become a leader in distributed object computing through the
acquisition of Visigenic and the release of products for the enterprise.
"Visigenic not only brings us leading middleware technology based on CORBA
(Common Object Request Broker Architecture), but also an expanded direct sales
force and the consulting and services required by our enterprise-level
customers," Yocam said.
Additionally, in the last quarter, Borland strengthened its direct sales
force in Japan by adding 15 sales and consulting staff who had previously
worked for OEC Japan, a joint venture between Borland and CSK Corporation that
was discontinued.
In order to further concentrate efforts on direct sales to the enterprise,
Borland spun off its U.S. channel sales department to an independent company,
Frontline Now!, in the quarter just ended.
During the first quarter, Borland released new or updated products aimed
at corporate IT (Information Technology) departments. Products included
Entera 4.0, an upgrade of the company's middleware for RPC-based environments;
Borland AppCenter, an advanced enterprise application management tool; and
Borland C++Builder 3 Client/Server Suite, an upgrade of the company's C++
language development tool. Additionally, Borland C++Builder 3 was released in
standard and professional versions.
Borland also continued to release products for enterprise-level customers
in partnership with other industry leaders. These include Delphi/Connect for
SAP, aimed at corporations building applications that integrate with SAP
R/3(TM) enterprise systems; and JBuilder/400 Client Server Suite, a version of
Borland's Java tool for the IBM AS/400 market.
In the first quarter, Borland also announced JBuilder 2.0, the latest
version of its 100 percent Pure Java development tool. JBuilder 2.0 will be
available in standard, professional, and client/server versions this quarter.
About Borland International
Borland International, Inc. is a leading provider of high-quality software
products for corporate application developers worldwide. Borland is
distinguished for its award-winning family of rapid application development
tools and scalable middleware technology for desktop, client/server,
Internet/intranet, and enterprise systems. The company's products are
supported through comprehensive corporate and independent developer programs,
value-added resellers, and systems integrators. Founded in 1983, Borland is
headquartered in Scotts Valley, California. For more information on Borland,
customers can visit Borland Online at borland.com.
Note: Forward-looking statements in this release, including but not
limited to, those concerning Borland's future financial performance, product
availability dates, and the potential features of or benefits to be derived
from the Company's products, involve a number of uncertainties and risks, and
actual events or results may differ materially. Factors that could cause
actual events or results to differ materially include, among others, the
following: difficulties in integrating the operations and technology of
Visigenic Software or other companies or technologies which the Company may
acquire, possible disruptive effects of organizational or personnel changes,
shifts in customer demand, market acceptance of the Company's new or enhanced
products, delays in scheduled product availability dates, actions or
announcements by competitors, software errors, general business conditions and
market growth rates in the client/server and Internet
software markets, and other factors described in the Company's S.E.C. reports
on forms 10-K, 10-Q, 8-K, and the Borland prospectus relating to the
acquisition of Visigenic Software.
NOTE: Borland product names are trademarks or registered trademarks of
Borland International, Inc. Other product names mentioned herein may be
trademarks of the party using such names.
BORLAND INTERNATIONAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data, unaudited)
Three Months Ended
March 31, 1998 March 31, 1997
Revenues
Licenses and other $41,043 $38,223
Services 5,443 5,197
Total revenues 46,486 43,420
Cost of revenues 6,384 7,681
Gross profit 40,102 35,739
Operating expenses
Research and development 11,171 16,123
Selling, general and administrative 27,302 41,448
Total continuing expenses 38,473 57,571
Provision for restructuring
and acquisition charges 19,282 5,976
Other non-recurring charges -- 17,100
Total restructuring, acquisition
and non-recurring charges 19,282 23,076
Total operating expenses 57,755 80,647
Operating loss (17,653) (44,908)
Interest income, net and other 598 739
Loss before taxes (17,055) (44,169)
Provision (benefit) for income taxes (3,612) 367
Net loss $(13,443) $(44,536)
Loss per share (A) $ (0.27) $ (0.92)
Shares used in the calculation
of loss per share 50,863 48,275
(A) The calculation of loss per share for the three months ended March 31,
1998 includes an accretion to the Mandatorily Redeemable Convertible Preferred
Stock of $142,000.
BORLAND INTERNATIONAL, INC.
CONDENSED CONSOLIDATED BALANCE SHEET
(in thousands, unaudited)
March 31, 1998 December 31, 1997
ASSETS
Current assets $142,169 $144,392
Property and equipment, net 104,686 104,944
Other non-current assets 6,382 6,417
Total assets $253,237 $255,753
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities $89,773 $79,876
Long-term debt and other 22,211 22,025
Mandatorily redeemable
convertible preferred stock 27,500 27,358
Stockholders' equity 113,753 126,494
Total liabilities
and stockholders' equity $253,237 $255,753
SOURCE Borland International, Inc.
CO: Borland International, Inc.
ST: California
IN: CPR
SU: ERN
04/21/98 16:13 EDT prnewswire.com
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