Business/Technology Editors
OAKLAND, Calif.--(BUSINESS WIRE)--Feb. 5, 2001
Versata, Inc. (Nasdaq: VATA), a provider of software and services that automate the development, deployment and change management of transaction-based e-business, today released its results for the fourth quarter and fiscal year ending December 31, 2000.
Total revenues for the quarter ended December 31, 2000 were $16.7 million, an increase of 224% from $5.2 million for the same period in 1999 and a decrease of 5% from $17.6 million for the third quarter 2000. The pro forma net loss, which excludes non-cash stock compensation charges, amortization of goodwill, and other non-operating expenses, was $11.9 million or $0.30 per share, compared to a pro forma net loss of $6.6 million or $0.22 per share for the fourth quarter 1999 and $7.8 million or $0.20 per share for the third quarter 2000.
Fourth quarter software license revenue grew 220% from fourth quarter 1999 and 12% sequentially to $9.6 million, from $3.0 million and $8.6 million, respectively. Professional services revenues and support fees were $7.1 million. As a percent of total revenue, software license revenue increased to 57.3% in the fourth quarter 2000 from 48.7% last quarter.
For the year 2000, total revenues reached $58.3 million, an increase of 363% from $12.6 million in 1999. The pro forma net loss, which excludes non-cash stock compensation charges, amortization of goodwill, and other non-operating expenses, was $37.7 million or $1.00 per share, compared to a pro forma net loss of $17.8 million or $0.72 per share in 1999.
"We're very pleased with our overall results for 2000. These results prove the validity of our strategy and the size of our market opportunity," said Jack Hewitt, President and Chief Executive Officer of Versata, Inc. "While our Q4 results were disappointing, we believe we are on the right track to achieve profitability this year. We've taken steps already to achieve this goal and look forward to reporting our progress with you throughout the year."
In the fourth quarter, Versata earned a gross profit of $7.2 million, up 168% from $2.7 million earned in the fourth quarter of 1999, and down 18.2% from $8.8 million in the prior quarter. Gross profit for the year 2000 was $26.6 million, an increase of 345% from 1999.
Versata ended the fourth quarter with $74.4 million in cash and short-term securities. The days sales outstanding (DSO) was 87 days at the end of the quarter, compared to 72 days in the third quarter 2000. Deferred revenue was $9.0 million at the end of the quarter, a 12.1% increase from the prior quarter figure of $8.0 million.
New Customers and Partners
Versata added 39 new domestic and international end-use customers in the fourth quarter, including:
-- Domestic: Children's Hospital of Cincinnati, Fireman's Fund, Force 10 Networks, Kemper Insurance, L.A. County Mental Health, Meridien Health Care, Raytheon, TAL Technologies, and Yalta Communications.
-- International: ADDECO/Cenergys, ALCATEL, British Telecom, Compagnie Francaise de Methane (CFM), Chantiers De L'Atlantique, CNASEA, France Telecom, KLM, Novaxess, and Wesdeutsche Landesbank.
In the year 2000, over 150 new end-use customers began using the Versata system, bringing the total to nearly 500.
In the fourth quarter 2000, 24% of Versata's customers were repeat end-users and value-added resellers. These included Colt Telecom, InvestorsPlus, Koch Petroleum Canada, Manitoba Blue Cross, Nekema, and Viewtrak Technologies.
Versata signed new agreements with system integrators and value-added resellers such as Aegis/Aetrex, Datanomix, Neasi-Weber International, Nextance, Solution Bank and Xenium. Also, Versata trained over 270 developers in the fourth quarter. Approximately 1,300 developers were trained in the year 2000. Additionally, Symphoni Interactive extended its agreement to include training and marketing of Versata's new product, the Versata Interaction Server.
Versata Interaction Server Launched
Versata's new product, the Versata Interaction Server (VIS), hit the market on November 6, 2000. VIS provides workflow and process automation and complements the Versata Logic Server. By the end of the fourth quarter, Versata signed five new VIS customers.
CIO Advisory Forums
Versata held CIO Advisory Forums in the U.S. and in Europe during the fourth quarter. The purpose of the forums was to bring together influential groups of business and IT leaders from Versata's customers and partners to discuss the issues surrounding the development and implementation of e-business transaction automation strategies and solutions.
Quarterly Conference Call
Versata, Inc. will host its quarterly conference call, open to all interested parties, at 2:00 pm Pacific Standard Time or 5:00 pm Eastern Standard Time, on Monday, February 5, 2001. The call will be broadcast over the Internet at www.versata.com.
About Versata
Versata provides software and services that enable customers to rapidly deploy e-business software applications that can be modified quickly to meet constantly changing business requirements. Versata's E-Business Automation System utilizes a unique business rules automation technology that redefines how companies create, deploy and modify the critical e-business software applications used to transact their online business.
Innovative Fortune 1000 and corporate customers such as Children's Hospital of Cincinnati, Hilton Hotels, ITT Fluid Technologies, JP Morgan, Sanwa Bank and United Defense, as well as new Internet exchanges including eBond-Trade.com, iMedNetworks.com, and yet2.com have all benefited from the Versata solution. The Versata System is available from Versata directly and from more than 200 system integrators, value added resellers and distributors worldwide.
Incorporated in 1995, and publicly-traded, Versata (Nasdaq: VATA - news) is headquartered in Oakland, California with offices throughout the United States and Europe. For more information, please contact Versata at www.versata.com, or call 800-984-7638 or email us at info-pr@versata.com.
This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and are subject to uncertainty and changes in circumstances. Actual results may vary materially from the expectations contained in the forward-looking statements. Forward-looking statements in this release include, but are not limited to, statements regarding the Company's expectations, beliefs, hopes, intentions or strategies regarding the future. These statements are not guarantees of future performance and actual results could differ materially from company's current expectations. Factors that could cause or contribute to such differences include, but are not limited to: ability to grow revenue, ability to decrease expenses, revenue recognition, market interest in the products, ability to deploy the products, ability to grow relationships with system integrators and other partners, the release of competitive products, economic conditions in foreign countries, and other possible risks. As a result, actual results may vary, perhaps materially, from those contained in the forward-looking statements. More information on risks and uncertainties related to the company and its business may be found in the Company's quarterly reports and Prospectus filed with the United States Securities and Exchange Commission. All forward looking statements included in this press release are based upon information available to the Company as of the date hereof, and the Company does not assume any obligation to update such statements or the reasons why actual results could differ materially from those projected in such statements.
Note to Editor: Versata and the Versata logo are trademarks of Versata, Inc. All other products or company names mentioned are used for identification purposes only, and may be trademarks of their respective owners.
VERSATA, INC. CONSOLIDATED BALANCE SHEETS (In thousands) December 31, December 31, 2000 1999 ---------- ---------- ASSETS Current Assets: Cash and cash equivalents $44,461 $20,655 Short-term investments 29,926 - Accounts receivable, net 16,210 5,587 Unbilled receivables 3,584 1,584 Prepaid expenses and other 4,075 2,311 ---------- ---------- Total current assets 98,256 30,137 Property and equipment, net 11,901 1,902 Note receivable from related parties 156 134 Intangibles, net 12,205 1,389 Other assets 354 98 ---------- ---------- Total assets $122,872 $33,660 ========== ========== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts Payable $9,040 $2,025 Accrued liabilities 13,392 7,298 Current portion of equipment loan and capital lease 134 166 Deferred revenue 9,000 4,433 ---------- ---------- Total current liabilities 31,566 13,922 Deferred stock-compensation liability 1,095 - Equipment loan and capital lease, less current portion 218 320 ---------- ---------- Total liabilities 32,879 14,242 Stockholders' equity 89,993 19,418 ---------- ---------- Total liabilities and stockholders' equity $122,872 $33,660 ========== ========== VERSATA, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) Quarter Ended Year Ended December 31, December 31, ------------------ -------------------- 2000 1999 2000 1999 --------- --------- --------- --------- Revenue: Software license $9,573 $2,996 $28,358 $6,729 Services 7,145 2,170 29,944 5,853 --------- --------- --------- --------- Total revenue 16,718 5,166 58,302 12,582 Cost of Revenue: Software license 443 124 1,234 499 Services 9,048 2,341 30,514 6,121 --------- --------- --------- --------- Total cost of revenue 9,491 2,465 31,748 6,620 --------- --------- --------- --------- Gross profit 7,227 2,701 26,554 5,962 Operating expense: Sales and marketing 13,065 6,545 46,817 15,609 Product development 2,964 1,736 9,727 4,769 General and administrative 4,341 1,158 12,675 3,125 Amortization of intangibles 681 - 1,341 - Stock-based compensation 3,210 2,463 25,512 3,955 --------- --------- --------- --------- Total operating expense 24,261 11,902 96,072 27,458 --------- --------- --------- --------- Loss from operations (17,034) (9,201) (69,518) (21,496) Interest income (expense) 1,293 145 5,064 (304) Other, net (62) - (62) - Other non-operating expenses (1) (693) - (937) - --------- --------- --------- --------- Net loss ($16,496) ($9,056) ($65,453) ($21,800) ========= ========= ========= ========= Basic and diluted net loss per share ($0.42) ($0.31) ($1.74) ($0.87) ========= ========= ========= ========= Weighted-average common shares used in computing basic and diluted net loss and pro forma net loss per share (2) 39,159 29,616 37,533 24,924 Pro forma net loss per share (2) (3): Net loss ($16,496) ($9,056) ($65,453) ($21,800) Add: Amortization of intangibles 681 - 1,341 - Stock-based compensation 3,210 2,463 25,512 3,955 Other non-operating expenses (1) 693 - 937 - --------- --------- --------- --------- Pro forma net loss ($11,912) ($6,593) ($37,663) ($17,845) ========= ========= ========= ========= Basic and diluted pro forma net loss per share (3) ($0.30) ($0.22) ($1.00) ($0.72) ========= ========= ========= ========= (1) Other non-operating expenses relate to office relocation costs. (2) The weighted-average common shares used in computing basic and diluted net loss and pro forma net loss per share are adjusted for the year ended December 31, 2000 to include the pro forma effects of the conversion of preferred stock to common stock, in connection with the company's initial public offering, as if the conversion occurred at the beginning of the period. (3) Pro forma net loss per share excludes non-cash stock compensation charges, amortization of goodwill, and other non-operating expenses as specified in (1) above.
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