OAKLAND, Calif., July 22 /PRNewswire/ -- Forte Software, Inc.
(Nasdaq: FRTE), a leading supplier of integration and development software for
enterprise e-business applications, today reported financial results for its
first quarter ended June 30, 1999.
Total revenue for the quarter increased to $22.2 million, a 22 percent
increase over the same period last year. License fee revenue totaled
$12.3 million for the first quarter, a 48 percent increase, as compared to
$8.3 million in the same period last year. Total license revenue from
Enterprise Application Integration (EAI) related products during the first
quarter was approximately $4.7 million, representing 38 percent of license fee
revenue and increased from $3.5 million in the previous quarter. License
revenue from the Company's core products decreased slightly from the prior
year to $7.6 million, that was more than offset with the increase in license
revenue from the EAI products. Maintenance and service revenue for the first
quarter was $9.9 million as compared with $9.8 million for the same period
last year. License fees represented 56 percent, and maintenance and services
contributed 44 percent of total revenue for the first quarter.
Reported net loss for the quarter was $487 thousand as compared to a net
loss of $2.3 million in the same period last year. Accordingly, net loss per
share for the first quarter was $.02 per share as compared to a net loss of
$.12 per share in the same period last year.
Marty Sprinzen, president and chief executive officer commented, "This is
an exciting time for Forte. We are at the beginning of two major
complimentary product lifecycles. Our EAI product family has already had a
dramatic impact on our license revenue growth. Both last quarter and this
quarter, results exceeded our internal expectations at 28% and 38% of software
license revenue respectively. We believe we have an opportunity to become a
recognized leader in the EAI market, which is projected by industry analysts
to grow from $550 million today to $5 billion by 2002. Also, the response to
our Java product launch (SynerJ) has exceeded our expectations. The product
is anticipated to go into production status and start generating revenue in
September."
Commenting on the Q1 performance Sprinzen said, "Domestic revenue was
strong sequentially during the first quarter at $15.3 million due to
increasing sales of our EAI products and improvements made in our U.S. sales
organization. Productivity in the Domestic sales organization was the second
highest it has ever been with Q4 of last year being the highest.
"During the first quarter we were awarded a significant number of new
contracts with quality companies such as CSAA, Fireman's Fund, a premier
Internet Service Provider, and BT Cellnet. Of all contracts for the quarter,
three were in excess of $1.0 million," he continued.
The Company ended the first quarter in a strong financial condition with
cash and accounts receivable balances of approximately $51 million. Days
sales in accounts receivable increased to 113 days from the immediately
preceding quarter. The increase resulted primarily from strong revenue booked
in the last month of the quarter and an increase in deferred revenue by
approximately $1.8 million.
The following table provides a summary of financial performance for the
first quarter ended June 30, 1999, as compared to the same period last year
(in millions, except per share data):
Quarter Ended
June 30,
1999 1998
Revenue $22.2 $18.2
Operating (loss) $(.6) $(2.6)
Net (loss) $(.5) $(2.3)
Basic (loss) per share $(.02) $(.12)
First Quarter Highlights
* Announced the availability of the Forte OS/390 Adapter for DB2,
supporting IBM's leading enterprise database. This adapter enables
organizations to very easily leverage mainframe information in new
applications. Support for OS/390 was further extended in July 99 with
the announcement of Transaction adapter for IMS and CICS.
* Demonstrated SynerJ at JavaOne, highlighting support for Java
Software's new Java2 Platform Enterprise Edition. The J2EE platform
makes enterprise-scale Java projects easier to implement and maintain.
* Announced SynerJ to be available for delivery in September 1999. Also,
yesterday at Internet World, SynerJ won the "Best of Show" award in the
category of Web Application Development Software.
* Announced that System Integrators Albion International and ThoughtWorks
had selected SynerJ for Java-based development projects.
* Announced the Forte Fusion EAI Process-Driven Architecture, a product
suite that provides the industry's first native XML based backbone
integrating business packages, legacy systems and custom components.
About Forte Software
Forte Software is a pioneer and market leader in the integration and
development of scalable enterprise-class distributed applications. Building
on this proven strength, Forte has more recently added new product families
for Enterprise Application Integration and for enterprise-class Java. IT
organizations, systems integrators and independent software vendors all use
Forte's products to respond effectively to today's rapidly changing customer
and competitive environments, in particular, the need to deliver
customer-facing e-business applications.
Today, Forte technology is used by 500 customers, including more than 100
application package providers. The company's products are sold directly
worldwide and through distribution partners which include Compaq, IONA
Technologies and NEON. For additional information, contact Forte Software at
info@forte.com or http://www.forte.com .
Forte is a registered trademark, and Forte Application Environment, Forte
Application Server, Forte Open Mainframe Architecture and Forte WebDesigner
are trademark, of Forte Software, Inc. OS/390 is a registered trademark of
IBM. Other brand or product names may be trademarks or registered trademarks
of their respective owners.
The statements in this release that relate to future plans, events, or
performance are forward-looking statements. Actual results might differ
materially due to a variety of factors. Forte Software cannot guarantee
completion of any future products or product features mentioned in this
release, and no reliance should be placed on their availability. Additional
information about factors that may impact results is contained in Forte
Software's Annual Report on Form 10-K under the sections entitled Business
Risks and Management's Discussion and Analysis of Financial Condition and
Results of Operations, and in other SEC filings including Forte Software's
most recent Form 10-Q.
Forte Software, Inc.
Condensed Consolidated Balance Sheet
(in thousands)
June 30 March 31,
1999 1999
ASSETS
Current assets:
Cash and cash equivalents $4,935 $11,789
Short-term investments 18,461 14,880
Accounts receivable, net 27,823 23,231
Prepaid expenses and other current assets 4,266 3,115
Total current assets 55,485 53,015
Equipment and leasehold improvements, net 3,990 4,707
Other assets 1,500 1,500
Total assets $60,975 $59,222
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable, accrued liabilities
and other obligations $11,221 $10,948
Deferred revenue 12,111 10,337
Total current liabilities 23,332 21,285
Capital lease obligations, due after one year - -
Deferred revenue 33 66
Commitments
Stockholders' equity:
Common stock 204 203
Additional paid-in capital 69,320 68,621
Accumulated deficit (31,508) (31,021)
Accumulated other comprehensive (loss) income (406) 68
Total stockholders' equity 37,610 37,871
Total liabilities and stockholders' equity $60,975 $59,222
Forte Software, Inc.
Condensed Consolidated Statement Of Operations
(in thousands, except per share amounts)
Three months ended
June 30,
1999 1998
Revenue
License fees $12,296 $8,331
Maintenance and services 9,857 9,825
Total revenue 22,153 18,156
Cost of revenue
License fees 328 234
Maintenance and services 5,486 4,934
Total Cost of revenue 5,814 5,168
Gross profit 16,339 12,988
Operating expenses
Sales and marketing 11,061 10,029
Product development and engineering 4,192 4,145
General and administrative 1,663 1,417
Total operating expenses 16,916 15,591
Loss from operations (577) (2,603)
Interest income and expense, net 235 385
Loss before income taxes (342) (2,218)
Provision for income taxes 145 128
Net loss $(487) $(2,346)
Loss per share -- Basic $ (0.02) $ (0.12)
Loss per share -- Diluted $ (0.02) $ (0.12)
Shares used in per share calculation
Basic 20,342 19,686
Diluted 20,342 19,686
SOURCE Forte Software, Inc.
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Related links:
http://www.forte.com
CONTACT:
Bob L. Corey, Senior Vice President and CFO
of Forte, 510-869-2013; or General, Virginia Turner, investors,
Karen Keating, or media, Steve Morrison, 415-986-1591, all of The
Financial Relations Board-BSMG Worldwide
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