Informix Announces Results for Fiscal Third Quarter
Revenue Increases Year-over-Year and Sequentially
MENLO PARK, Calif. – October 21, 1998 – Informix Corporation (NASDAQ: IFMX), the technology leader in enterprise database-powered solutions, today announced financial results for the third fiscal quarter ended September 30. Revenue was $185.2 million, an increase of 23 percent from the $150.2 million posted in the year-ago quarter and an increase of 6 percent from the $174.2 million recorded in the prior quarter. Third quarter net income applicable to common stockholders was $18.4 million, or $.10 per share on a diluted basis, compared with a net loss of $110.5 million, or $.73 per share, in the third quarter of 1997.
License revenue of $96.3 million was up 24 percent from the prior year and 12 percent sequentially. Service revenue grew 22 percent from the third quarter of 1997 to $88.9 million, and increased slightly from the prior quarter's $88.2 million. The regions of North America and Europe both posted year-over-year and sequential revenue growth, increasing to $92.3 million and $59.7 million, respectively. Revenue of $20.5 million in the Asia/Pacific region increased 5 percent from the year-ago quarter, but declined
slightly on a sequential basis. Revenue of $12.6 million in the Latin America region increased 9 percent from the third quarter of 1997, but declined 17 percent from the previous quarter, due largely to local economic conditions and currency fluctuations.
"I am pleased we were able to show year-over-year and sequential growth, as well as continued improvement in our operating profit." said Bob Finocchio, Chairman and Chief Executive Officer of Informix. "We continue to focus on those market segments where we have competitive advantage, including high-performance on-line transaction processing, data warehousing and web/e-commerce. I believe these markets represent very attractive growth opportunities for Informix."
During the third quarter, Informix:
Strengthened its European management team with the appointment of Richard Snook to the position of President, Europe, Middle East and Africa. Mr. Snook, formerly vice president of group marketing with Bull in France, brings 28 years of management, sales and marketing experience in the high technology arena to Informix.
Announced Decision Frontier Solution Suite, a complete data warehousing solution that combines best-of-breed products and technologies from Informix, Ardent Software and Seagate Software in a single, scalable solution capable of handling all major data warehousing tasks. By providing capabilities such as the automated transfer of OLTP information to data warehouse/data mart applications, Decision Frontier Solution Suite provides a powerful, integrated platform on which to build analytic applications such as one-to-one marketing, fraud detection, and customer turnover analysis.
Shipped the first enterprise-quality database solution for the increasingly popular Linux operating environment.
Hosted the Informix Worldwide Users Conference in Seattle, WA. With tutorials and special interest sessions, the event served to re-affirm Informix's commitment to open, leading-edge database technology and superior customer and developer support.
Aligned its marketing, development and consulting organizations around key market opportunities, creating new Data Warehousing and Web/e-commerce Divisions. Led by Leonard Palomino and Wes Raffel, respectively, these new divisions will aggressively focus on building Informix's markets in these areas.
To accelerate its growth in the data warehousing market, on October 7, Informix announced a definitive agreement to acquire Red Brick Systems, Inc., a pioneer in data warehousing and data mart solutions, in a purchase transaction that will exchange 0.6 share of Informix common stock for each share of Red Brick Systems common stock. The transaction, which is subject to regulatory and Red Brick stockholder approval, is anticipated to close before the end of the year and will result in the issuance of approximately 7.6 million shares of Informix stock. Red Brick's technology will be added to the Decision Frontier Solution Suite for building scalable, high performance data warehouses and data marts.
About Informix
Informix Corporation, based in Menlo Park, California, provides innovative database products that assist the world's major corporations attain competitive advantage. Informix is widely recognized as the technology leader for corporate computing environments ranging from small workgroups to very large parallel processing applications. Informix's database server, application development tools, superior customer service, and strong partnerships enable the company to be at the forefront of major information technology solution areas including data warehousing, high performance OLTP, and Web/e-commerce. For more information, contact the sales office nearest you or visit our Web site at informix.com.
This public announcement contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or anticipated results. Investors and potential investors should review carefully the description of the risks and uncertainties which, together with other detailed information about Informix Corporation, is contained in the periodic reports that Informix files from time to time with the Securities and Exchange Commission.
The risks and uncertainties include, but are not limited to: the restatements of the Company's financial statements; growth rates, fluctuations in quarterly results and the seasonality of the Company's business; the Company's dependence upon and ability to attract and retain qualified personnel; risks and uncertainties associated with preferred stock financings; competition and technological changes in the Company's business; international operations and currency fluctuations; the Company's dependence upon proprietary technology; the potential need for additional financing; and pending private securities litigation.
This public announcement contains information that is accurate as of the 21st of October 1998, the date of the public announcement. The Company disclaims any obligation to update or correct the information as a result of financial, business or any other developments occurring after October 21, 1998.
© 1998 Informix Corporation. All rights reserved. The following are trademarks of Informix Corporation or its affiliates: Decision Frontier Solution Suite™ and the Informix logo which is registered with the United Stated Patent and Trademark Office.
Informix Corporation
Condensed Consolidated Balance Sheets
(in thousands)
September 30, December 31,
1998 1997
____________ ____________
(unaudited)
ASSETS
Current assets:
Cash and short-term investments $ 156,414 $ 155,465
Accounts receivable, net 151,637 142,048
Deferred taxes 44,717 12,249
Other current assets 25,182 26,243
_____________ ___________
Total current assets 377,950 336,005
Property and equipment, net 75,864 96,012
Software costs, net 37,972 40,854
Deferred taxes 18,046 56,345
Long-term investments 14,655 -
Intangible assets, net 6,615 8,277
Other assets 7,242 25,751
_____________ ___________
Total assets $ 538,344 $ 563,244
============= ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 24,693 $ 36,155
Accrued expenses 44,681 64,538
Accrued employee compensation 47,819 49,154
Income taxes payable 4,947 3,031
Deferred income taxes 1,086 -
Deferred maintenance revenue 115,485 100,828
Advances from customers and financial
institutions 139,304 180,048
Accrued restructuring charges 9,085 26,597
Other current liabilities 5,248 15,802
__________ __________
Total current liabilities 392,348 476,153
Other liabilities 4,467 6,311
Deferred taxes 14,895 21,716
Stockholders' equity:
Convertible preferred stock - 3
Common stock 1,723 1,526
Additional paid-in capital 373,136 347,582
Accumulated deficit (245,000) (278,144)
Unrealized gain (loss) on available-
for-sale securities, net of tax 3,083 (767)
Foreign currency translation adjustment (6,308) (11,136)
_________ __________
Total stockholders' equity 126,634 59,064
_________ __________
Total liabilities and
stockholders' equity $ 538,344 $ 563,244
========= =========
Informix Corporation
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
Three months ended Nine months ended
September 30, September 28, September 30, September 28,
1998 1997 1998 1997
___________ ___________ ___________ __________
(unaudited) (unaudited)
Net revenues:
Licenses $ 96,334 $ 77,437 $ 265,731 $ 273,081
Services 88,877 72,747 254,680 209,532
___________ ___________ ___________ __________
185,211 150,184 520,411 482,613
Costs and
expenses:
Cost of
software
distribution 8,569 11,793 26,661 52,860
Cost of
services 38,467 40,493 113,404 128,197
Sales and
marketing 64,799 101,946 193,716 347,906
Research and
development 34,863 34,106 107,673 108,420
General and
administrative 20,645 18,144 50,549 72,110
Write-off of
goodwill and
other long-
term assets - - - 30,473
Write-off of
acquired
research &
development - - - 7,000
Restructuring (2,572) 49,733 (7,255) 109,356
___________ ___________ ___________ _________
164,771 256,215 484,748 856,322
___________ ___________ ___________ _________
Operating
income (loss) 20,440 (106,031) 35,663 (373,709)
Interest income 2,488 1,290 6,359 3,691
Interest expense (1,416) (2,103) (4,582) (6,839)
Other income
(expense),net (2,494) (879) (2,396) 17,596
___________ ___________ ___________ ________
Income (loss)
before income
taxes 19,018 (107,723) 35,044 (359,261)
Income taxes - 2,800 1,900 6,800
___________ ___________ ___________ __________
Net income
(loss) 19,018 (110,523) 33,144 (366,061)
___________ ___________ ___________ __________
----------- ----------- ----------- ----------
Preferred stock
dividend (589) - (1,816) -
Value assigned
to warrants - - (1,982) -
___________ ___________ ___________ __________
Net income (loss)
applicable to
common stock-
holders $ 18,429 $(110,523) $ 29,346 $(366,061)
___________ ___________ ___________ __________
----------- ----------- ----------- ----------
Net income
(loss) per
common share
Basic $ 0.11 $ (0.73) $ 0.18 $ (2.41)
Diluted $ 0.10 $ (0.73) $ 0.17 $ (2.41)
Weighted average
number of common
shares outstanding
Basic 169,077 152,352 165,711 151,708
Diluted 182,272 152,352 171,406 151,708
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