. . .UOL Publishing [UOLP] Earnings. . . . <glad I didn't dump yet>
UOL Publishing, Inc. Reports 224% Increase In First Quarter 1999 Online Revenue Over Prior Year's First Quarter
McLEAN, Va., May 4 /PRNewswire/ -- UOL Publishing, Inc. (Nasdaq: UOLP), an online host of virtual campuses for distance training and education programs on behalf of corporate, governmental and academic institutions, today announced results for the first quarter of 1999.
Highlights
Online Business
-- During the first quarter of 1999, sale of online courses jumped
235% to reach approximately 63,000 courses delivered during the
quarter, up from first quarter 1998 deliveries of approximately
18,700. As a result, online tuition revenue for the first quarter of
1999 reached $881,248, up 224% from first quarter 1998 online tuition
revenue of $272,205.
-- On a consecutive quarter basis, the number of online courses sold for
the first quarter of 1999 was up 76% from fourth quarter 1998 when
approximately 36,000 online courses were sold. Online tuition revenue
for the first quarter of 1999 grew 59% to $881,248 from fourth quarter
1998 online tuition revenue of $555,029.
Total Expenses
-- Total expenses for the first quarter of 1999 fell to $4,474,395, down
53% when compared to the same quarter in 1998 when total expenses
reached $9,463,754. The decrease primarily reflects the effect of
cost-cutting measures initiated at the end of the first quarter of
1998 and, to a lesser extent, the divestitures of Ivy Software, Inc.
and the HTR consulting business.
-- On a consecutive quarter basis, total expenses for the first quarter
of 1999 declined 18% when compared to total expenses of $5,454,576
for the fourth quarter of 1998, after excluding certain non-recurring
charges incurred during the fourth quarter. The improvement
primarily reflects the divestiture of the HTR consulting business at
the end of 1998.
Liquidity
-- Cash used in operating activities for the first quarter ended March
31, 1999 was approximately $599,000, all of which was funded by a
private placement of common stock totaling approximately $1 million.
Net cash used in operating activities for the same period in 1998 was
approximately $3,054,000. The improvement primarily reflects cost-
cutting measures initiated at the end of the first quarter of 1998.
-- During the first quarter of 1999, the Company has taken the following
actions to provide future funding for operations:
* The Company raised approximately $1 million through a private
placement managed by Spencer Trask Securities. In addition, during
April the Company raised approximately $700,000 through a private
placement of common stock. Both placements primarily included
current investors.
* The Company has retained investment-banking services to assist in
the divestiture of the HTR instructor-led training business. The
Company expects to complete this divestiture sometime during the
second or third quarter of 1999.
Commenting on the results, Nat Kannan, Chairman and CEO of UOL said, "the
online benchmarks that matter most to UOL have shown dramatic increases;
online revenue, number of students and number of courses have all continued
their upward trend. We have also been very successful in reducing our burn
rate, thanks in large part to the difficult cost-cutting measures we took
early last year. The combined impact of these trends should make 1999 a
break-away year for UOL."
Mr. Kannan said the Company's near-term focus will be improving liquidity
through the sale of its legacy businesses. During the first quarter, the
Company agreed to sell the HTR Knowledgeworks legacy business for $1.5
million, which is expected to be completed during the second quarter of 1999.
According to Mr. Kannan, other funding sources include an equity financing
agreement that is currently being finalized that could provide up to
$3 million in equity financing over the next six months and a $3 million line
of credit facility with a new lender that is expected to be completed shortly.
The Company has also retained advisory services to identify a strategic
partner to provide both global marketing leverage and additional capital.
First Quarter 1999 Results Compared to First Quarter 1998
During the first quarter of 1999, the Company incurred a net loss of
$1,567,079, or $0.39 per share, as compared to a net loss of $6,460,386, or
$1.70 per share, for the first quarter of 1998. Notably, the first quarter
results for 1998 included certain non-recurring costs related to a
reorganization plan initiated at the end of the first quarter of 1998. When
these non-recurring costs are excluded, the total loss for the first quarter
of 1998 was $5,992,746, or $1.58 per share.
Total revenues for the three months ended March 31, 1999 were $3,035,083
as compared to $3,600,860 for the three months ended March 31, 1998. The
change in revenue reflects an increase in online tuition revenue, which was
offset by a decline in revenues generated from the Company's legacy
businesses. The decline in the legacy revenues reflects the exclusion of
revenues related to Ivy Software, Inc. and HTR's consulting business, which
were sold at the end of the third and fourth quarters of 1998, respectively.
Revenues from the instructor-led training and Knowledgeworks legacy businesses
also declined during the first quarter of 1999 when compared to the same
period in 1998. In addition, sales declined in product sales of Teletutor as
the CBT-based sales transitioned to online sales.
Total costs and expenses for the first quarter of 1999 were $4,474,395
compared to $9,463,754 incurred during the same quarter in 1998, after
excluding certain non-recurring costs as described above. The decrease
primarily reflects the effect of cost-cutting measures initiated at the end of
the first quarter of 1998 and, to a lesser extent, the divestitures of Ivy and
the HTR consulting business.
UOL Publishing, Inc. hosts virtual campuses for distance training and
education programs on behalf of corporate and academic institutions. The
Company offers virtual campus services over a proprietary platform called
VCampus(TM), providing access to UOL's high quality library of interactive,
on-demand, web-based courseware. UOL serves over 80,000 working adults
through its partnerships with corporations and academic institutions. For
more information, call 703-893-7800, or visit the UOL Publishing, Inc. web
site at www.uol.com.
With the exception of the historical information contained in the release,
the matters described herein contain forward-looking statements that are made
pursuant to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. Forward-looking statements involve a number of risks and
uncertainties including but not limited to difficulties in managing rapid
growth (including future capital needs), development of its target market,
risks associated with acquisitions, and economic, competitive, governmental
and technological factors outside the control of the Company. For more
information regarding these risks and uncertainties see the Company's
Registration Statement on Form S-1 and other SEC filings, copies of which are
available upon request from the Company.
UOL Publishing, Inc.
Consolidated Balance Sheets As of
March 31, December 31,
1999 1998
Assets
Current assets:
Cash $125,147 $336,194
Accounts receivable, net 2,679,291 3,087,268
Loans receivable from
related parties 133,752 143,515
Loans receivable - current 199,818 232,375
Prepaid expenses and other
current assets 353,741 172,926
Total current assets 3,491,749 3,972,278
Property and equipment, net 2,175,825 2,436,534
Capitalized software costs, net 2,018,327 2,130,665
Acquired online publishing rights 364,831 407,552
Other assets 563,127 574,878
Intangible assets, net 2,339,230 2,508,664
Goodwill, net 2,764,294 2,840,460
Total assets $13,717,383 $14,871,031
Liabilities and stockholders' equity:
Current liabilities:
Accounts payable and
accrued expenses $4,292,171 $4,617,418
Current portion of notes payable 2,473,474 3,075,139
Deferred revenue 1,201,985 911,072
Accrued dividends payable 73,411 --
Total current liabilities 8,041,041 8,603,629
Long-term liabilities:
Notes payable, less current portion 353,199 337,235
Deferred revenue - non current 102,583 109,834
Total liabilities 8,496,823 9,050,698
Stockholders' equity:
Series C convertible Preferred Stock 6,263 6,263
Series D convertible Preferred Stock 10,826 10,826
Common Stock 42,766 39,900
Additional paid-in capital 54,498,115 53,460,264
Accumulated deficit (49,337,410) (47,696,920)
Total stockholders' equity 5,220,560 5,820,333
Total liabilities and
stockholders' equity $13,717,383 $14,871,031
UOL Publishing, Inc.
Consolidated Statements of Operations
Three Months Ended
March 31, March 31,
1999 1998
Revenues:
Online tuition revenues $881,248 $272,205
Virtual campus software revenues 42,166 42,500
Product sales revenues 399,635 950,206
Development and other revenues 235,874 96,481
Instructor-led training revenues 1,394,444 1,673,817
Other service revenues 81,716 565,651
Net revenues 3,035,083 3,600,860
Cost of revenues 1,882,848 2,582,899
Gross profit 1,152,235 1,017,961
Operating expenses:
Sales and marketing 1,042,556 1,630,558
Product development 357,454 2,716,619
General and administrative 688,161 1,900,513
Depreciation and amortization 503,376 633,165
Reorganization and other
non-recurring costs -- 467,640
Total operating expenses 2,591,547 7,348,495
Loss from operations (1,439,312) (6,330,534)
Interest income (expense) (127,767) (129,852)
Net loss (1,567,079) (6,460,386)
Dividends to preferred stockholders (73,411) --
Net loss available to common
stockholders $(1,640,490) $(6,460,386)
Net loss per share available to
common stockholders $(0.39) $(1.70)
Weighted average number of
shares outstanding 4,169,225 3,811,428
SOURCE UOL Publishing, Inc. |
