SAN DIEGO, April 5 /PRNewswire-FirstCall/ -- Peregrine Systems, Inc.
(OTC: PRGN), a leading provider of enterprise asset and service management
solutions, today filed its quarterly report on Form 10-Q, which includes
historical financial results for the fiscal 2005 second quarter ended
Sept. 30, 2004, with the U.S. Securities and Exchange Commission (SEC).
(Logo: http://www.newscom.com/cgi-bin/prnh/20031119/SDPERELOGO)
In accordance with generally accepted accounting principles (GAAP),
Peregrine adopted fresh-start reporting during the fiscal 2004 second quarter
ended Sept. 30, 2003 as a result of its emergence from Chapter 11
reorganization proceedings in August 2003. Therefore, Peregrine's financial
results after the July 18, 2003 adoption of fresh-start reporting are not
comparable to results reported for prior periods because of differences in the
basis of accounting and the capital structure of the predecessor company and
the successor company. Peregrine adopted fresh-start reporting and adjusted
the carrying value of its assets and liabilities to their fair value,
effective July 18, 2003, the date the company's plan of reorganization was
confirmed. As a result, the company re-valued its balance sheet in the fiscal
2004 second quarter.
For the fiscal 2005 second quarter, results of operations are reported for
the three and six months ended Sept. 30, 2004 and the 74 days ended Sept. 30,
2003 for the successor company, and the 18 days and 109 days ended July 18,
2003 for the predecessor company.
Historical GAAP Financial Results and Highlights:
License revenue for the three and six months ended Sept. 30, 2004 and the
74 days ended Sept. 30, 2003 does not include any revenue from license
transactions initiated prior to fiscal 2003. License revenue for the 18 days
and 109 days ended July 18, 2003 included $0.6 million and $5.6 million,
respectively, for transactions entered into prior to fiscal 2003 but for which
revenue was first recognizable in those periods.
* Total revenue for the successor company for the three months ended
Sept. 30, 2004 and for the 74 days ended Sept. 30, 2003 was
$47.9 million and $35.2 million, respectively. Revenue for the
predecessor company for the 18 days ended July 18, 2003 totaled
$6.2 million. The $6.2 million included approximately $0.6 million
attributable to transactions initiated prior to fiscal 2003, but for
which the revenue recognition criteria were not fully met until the
later period. For the six months ended Sept. 30, 2004, total revenue
for the successor company was $88.1 million. Revenue for the
predecessor company for the 109 days ended July 18, 2003 was
$48.7 million. The $48.7 million included approximately $5.6 million
attributable to transactions initiated prior to fiscal 2003, but for
which the revenue recognition criteria were not fully met until the
later period.
* License revenue for the successor company for the three months ended
Sept. 30, 2004 and the 74 days ended Sept. 30, 2003 was $15.6 million
and $14.1 million, respectively. License revenue for the predecessor
company for the 18 days ended July 18, 2003 was $1.1 million. The
$1.1 million includes approximately $0.5 million attributable to
transactions initiated in the reported period, while approximately
$0.6 million was attributable to transactions initiated prior to
fiscal 2003. For the six months ended Sept. 30, 2004, license revenue
for the successor company totaled $26.8 million. License revenue for
the predecessor company for the 109 days ended July 18, 2003, was
$13.5 million. The $13.5 million included $7.9 million that was
attributable to transactions initiated in the reported period, while
$5.6 million was attributable to transactions initiated prior to
fiscal 2003.
* For the three months ended Sept. 30, 2004, the successor company's net
loss was $3.7 million, or $0.24 per share, on 15.1 million shares
outstanding. For the 74 days ended Sept. 30, 2003, the successor
company's net loss was $5.4 million, or $0.36 per share, on
15.0 million shares outstanding. For the 18 days ended July 18, 2003,
the predecessor company's net income was $383.3 million, or $1.83 per
diluted share on 209.4 million shares outstanding. For the six months
ended Sept. 30, 2004, the successor company's net loss was
$18.9 million, or $1.26 per share, on 15.0 million shares outstanding.
For the 109 days ended July 18, 2003, the predecessor company's net
income was $374.2 million, or $1.82 per diluted share, on
208.3 million shares outstanding.
As of Dec. 31, 2004, the successor company's cash, cash equivalents and
marketable securities, excluding restricted cash, was $82.7 million. The
non-trade debt, including accrued interest, totaled $55.5 million, including
secured factor loans, senior notes and non-interest bearing notes issued to
satisfy pre-petition debt.
Historical Non-GAAP Pro Forma Combined Financial Results:
* Peregrine realized non-GAAP pro forma net income of $2.4 million, or
$0.16 per share, for the three months ended Sept. 30, 2004, compared
with non-GAAP pro forma combined net income of $0.3 million, or
$0.02 per share, for the three months ended Sept. 30, 2003. The
company incurred a non-GAAP pro forma net loss of $6.1 million, or
$0.41 per share, for the six months ended Sept. 30, 2004, compared
with non-GAAP pro forma combined net loss of $2.8 million, or $0.18
per share, for the six months ended Sept. 30, 2003. The non-GAAP pro
forma results exclude charges for amortization of intangibles,
restructuring and bankruptcy reorganization.
The company has reconciled the non-GAAP pro forma net loss to GAAP net
loss in a table accompanying this press release. The pro forma net loss is
not prepared in accordance with GAAP and may be different from non-GAAP
financial measures used by other companies. Non-GAAP financial measures
should not be considered as a substitute for, or superior to, measures of
financial performance prepared in accordance with GAAP.
Peregrine uses non-GAAP pro forma information in analyzing financial
results because Peregrine's management believes that it provides meaningful
information regarding the company's operating performance and facilitates
management's internal comparisons of the company's historical and current
operating results and to the operating results of other companies. The
company believes that non-GAAP pro forma information is useful to investors
because it allows for greater transparency of the company's operating
performance.
Management Commentary
"Today's filing of our fiscal 2005 second quarter financial results marks
another significant milestone for the company," said John Mutch, Peregrine's
president and CEO. "The results for the quarter ended Sept. 30, 2004 show
that we're making steady progress, delivering on our strategy to grow our core
business. For the second consecutive quarter, our pro forma license revenue
increased primarily as a result of our existing customers' demand for our
industry-leading asset and service management software. We are one step
closer to becoming current in our financial filings and will continue to work
diligently to file the remaining historical quarterly report, for
Dec. 31, 2004, as quickly as we can."
About Peregrine Systems
Peregrine Systems, Inc. develops enterprise software solutions that enable
organizations to evolve their IT service and asset management practices for
reduced costs, improved productivity and service, and lower risk. The
company's IT asset and service management software solutions -- ranging from
Peregrine Asset Tracking and Peregrine Service Establishment to Peregrine
Asset Optimization and Peregrine Service Optimization -- address specific
business problems. These solutions make it possible for IT organizations to
maintain a changing IT infrastructure, manage their relationships with end-
users and service providers, and gain greater visibility into how their IT
investments are performing. The Peregrine Evolution Model provides a roadmap
for companies that want to systematically evolve the sophistication and
effectiveness of their IT operating practices.
Founded in 1981, Peregrine has sustained a longstanding tradition of
delivering solutions with superior functionality to a broad segment of the
global enterprise customer market. Headquartered in San Diego, Calif., the
company conducts business from offices in the Americas, Europe and Asia
Pacific. For more information, please visit: http://www.peregrine.com.
Peregrine Systems is a registered trademark of Peregrine Systems, Inc. or
its affiliates. All other marks are the property of their respective owners.
Risk Factors
The financial results described in this press release are historical, in
part because the company has significant deficiencies, including material
weaknesses, in its internal controls over financial reporting. The company is
not current in filing its financial reports, and until the company's periodic
reports are current, investors will not have current financial information.
For this reason and based on the other risk factors described in the company's
Form 10-K annual report for the fiscal year ended March 31, 2004, filed
Dec. 20, 2004, the company believes trading in its securities at this time is
highly speculative and involves a high degree of risk.
Forward-Looking Statements
This press release contains forward-looking statements made pursuant to
the safe harbor provisions of the Private Securities Litigation Reform Act of
1995, particularly statements regarding the expectations, beliefs, plans and
intentions of the company. These statements relate to expectations about
future events or results and are based upon information available to the
company as of today's date. These forward-looking statements are not
guarantees of the future performance of the company and actual events or
results may vary materially from the events and results discussed in this
press release or in any other forward-looking statements made by or on behalf
of the company. The company disclaims any obligation to update or revise any
of the forward-looking statements contained herein to reflect future events or
developments.
Investor Relations:
Heidi Flannery
Ficomm
(503) 203-8808 ext. 103
heidi.flannery@ficomm.com
Media Relations:
MeeLin Nakata
Peregrine Systems, Inc.
(858) 720-5609
meelin.nakata@peregrine.com
Linda Findley
Text 100
(415) 836-5990
peregrine@text100.com
Industry Analyst Relations:
Beth Johnson
Peregrine Systems, Inc.
(415) 283-5221
elizabeth.johnson@peregrine.com
PEREGRINE SYSTEMS, INC.
Total Revenue
(dollars in thousands; unaudited)
The following tables summarize successor company revenue for the three
and six months ended Sept. 30, 2004 and pro forma combined revenue for
the three and six months ended Sept. 30, 2003:
Three Months
Successor Pro Forma
Company(1) Successor Predecessor Combined(2)
Three Company(1) Company(1) Three
Months 74 Days 18 Days Months
Ended Ended Ended Ended
Sept. 30, Sept. 30, July 18, Sept. 30,
2004 2003 2003 2003
-------- -------- -------- -------
Total revenue
New $47,934 $35,220 $5,590 $40,810
Pre-fiscal 2003
transactions -- -- 609 609
-------- -------- -------- --------
Total $47,934 $35,220 $6,199 $41,419
======== ======== ======== ========
Change
-------------------
Amount Percent
-------- --------
Total revenue
New $7,124 17 %
Pre-fiscal 2003 transactions (609) (100)%
--------
Total $6,515 16 %
========
Six Months
Successor Pro Forma
Company(1) Successor Predecessor Combined(2)
Six Company(1) Company(1) Six
Months 74 Days 109 Days Months
Ended Ended Ended Ended
Sept. 30, Sept. 30, July 18, Sept. 30,
2004 2003 2003 2003
-------- -------- -------- -------
Total revenue
New $88,108 $35,220 $43,060 $78,280
Pre-fiscal 2003
transactions -- -- 5,595 5,595
-------- -------- -------- --------
Total $88,108 $35,220 $48,655 $83,875
======== ======== ======== ========
Change
-------------------
Amount Percent
-------- --------
Total revenue
New $9,828 13 %
Pre-fiscal 2003 transactions (5,595) (100)%
--------
Total $4,233 5 %
========
Notes:
(1) Peregrine's financial results for periods after the July 18, 2003
adoption of fresh-start reporting are not comparable to results
reported for prior periods because of differences in the basis of
accounting and the capital structure of the predecessor company and
the successor company.
(2) Pro forma combined represents the addition of the successor company
and predecessor company for the periods noted.
PEREGRINE SYSTEMS, INC.
Total License Revenue
(dollars in thousands; unaudited)
The following tables summarize successor company license revenue for
the three and six months ended Sept. 30, 2004 and pro forma combined
license revenue for the three and six months ended Sept. 30, 2003:
Three Months
Successor Pro Forma
Company(1) Successor Predecessor Combined(2)
Three Company(1) Company(1) Three
Months 74 Days 18 Days Months
Ended Ended Ended Ended
Sept. 30, Sept. 30, July 18, Sept. 30,
2004 2003 2003 2003
-------- -------- -------- -------
Licenses
New $15,623 $14,052 $441 $14,493
Pre-fiscal 2003
transactions -- -- 609 609
-------- -------- -------- --------
Total $15,623 $14,052 $1,050 $15,102
======== ======== ======== ========
Change
-------------------
Amount Percent
-------- --------
Licenses
New $1,130 8 %
Pre-fiscal 2003 transactions (609) (100)%
--------
Total $521 3 %
========
Six Months
Successor Pro Forma
Company(1) Successor Predecessor Combined(2)
Six Company(1) Company(1) Six
Months 74 Days 109 Days Months
Ended Ended Ended Ended
Sept. 30, Sept. 30, July 18, Sept. 30,
2004 2003 2003 2003
-------- -------- -------- -------
Licenses
New $26,768 $14,052 $7,930 $21,982
Pre-fiscal 2003
transactions -- -- 5,595 5,595
-------- -------- -------- --------
Total $26,768 $14,052 $13,525 $27,577
======== ======== ======== ========
Change
-------------------
Amount Percent
-------- --------
Licenses
New $4,786 22 %
Pre-fiscal 2003 transactions (5,595) (100)%
--------
Total $(809) (3)%
Notes:
(1) Peregrine's financial results for periods after the July 18, 2003
adoption of fresh-start reporting are not comparable to results
reported for prior periods because of differences in the basis of
accounting and the capital structure of the predecessor company and
the successor company.
(2) Pro forma combined represents the addition of the successor company
and predecessor company for the periods noted.
PEREGRINE SYSTEMS, INC.
Reconciliation of Non-GAAP Pro Forma Combined
Net Income (Loss) with GAAP Net Income (Loss)
(in thousands, except per share amounts)
Three Months
Successor Successor Predecessor
Company(1) Company(1) Company(1)
Three Months Ended 74 18
Sept. 30, 2004 Days Days
--------------------- Ended Ended
Net Income Per Share Sept. 30, July 18,
(Loss) 2003 2003
--------- --------- --------- ---------
Non-GAAP pro-forma
net income (loss) $2,440 $0.16 $3,113 $(2,837)
Amortization of
intangibles (5,783) (0.38) (4,702) --
Reorganization items,
net (335) (0.02) (3,806) 386,148
--------- --------- --------- ---------
GAAP net (loss)
income (except
combined
Sept. 30, 2003) $(3,678) $(0.24) $(5,395) $383,311
========= ========= ========= =========
Fully Diluted Shares 15,052 15,000 209,368
Pro Forma Combined(2)
Three Months Ended
Sept. 30, 2003
------------------------------
Net Income
(Loss) Per Share
---------- ----------
Non-GAAP pro-forma
net income (loss) $276 $0.02
Amortization of intangibles (4,702) (0.32)
Reorganization items, net 382,342 25.49
--------- ---------
GAAP net (loss) income
(except combined
Sept. 30, 2003) $377,916 $25.19
========= =========
Fully Diluted Shares 15,000(3)
Six Months
Successor Successor Predecessor
Company(1) Company(1) Company(1)
Six Months Ended 74 Days 109 Days
Sept 30, 2004 Ended Ended
--------------------- Sept. 30, July 18,
Net Loss Per Share 2003 2003
-------- --------- --------- ---------
Non-GAAP pro-forma
net (loss) income $(6,130) $(0.41) $3,113 $(5,871)
Amortization of
intangibles (11,614) (0.77) (4,702) --
Restructuring and
other -- -- -- 1,239
Reorganization
items, net (1,146) (0.08) (3,806) 378,821
--------- --------- --------- ---------
GAAP net (loss)
income (except
combined
Sept. 30, 2003) $(18,890) $(1.26) $(5,395) $374,189
========= ========= ========= =========
Fully Diluted Shares 15,037 15,000 208,302
Pro Forma Combined(2)
Six Months Ended
Sept. 30, 2003
Net (Loss)
Income Per Share
---------- ----------
Non-GAAP pro-forma
net (loss) income $(2,758) $(0.18)
Amortization of intangibles (4,702) (0.31)
Restructuring and other 1,239 0.08
Reorganization items, net 375,015 25.00
--------- ---------
GAAP net (loss) income
(except combined
Sept. 30, 2003) $368,794 $24.59
========= =========
Fully Diluted Shares 15,000(3)
Notes:
(1) Peregrine's financial results for periods after the July 18, 2003
adoption of fresh-start reporting are not comparable to results
reported for prior periods because of differences in the basis of
accounting and the capital structure of the predecessor company and
the successor company.
(2) Pro forma combined represents the addition of the successor company
and predecessor company for the periods noted.
(3) Fully diluted shares converted based upon recapitalization of the
company with 15 million shares on Aug. 7, 2003 retroactively applied
to the pro forma combined three and six months ended Sept. 30, 2003.
PEREGRINE SYSTEMS, INC.
Condensed Consolidated Balance Sheets
(in thousands, except share data)
Successor Successor
Company Company
Sept. 30, 2004 March 31, 2004
-------------- --------------
(unaudited)
ASSETS
Current Assets:
Cash and cash equivalents $73,520 $105,946
Cash-restricted 4,677 4,654
Marketable securities 8,000 --
Accounts receivable, net of
allowance for doubtful accounts 33,299 39,113
Deferred taxes 4,707 4,660
Other current assets 13,690 13,395
-------------- --------------
Total current assets 137,893 167,768
Property and equipment, net 7,164 7,507
Identifiable intangible assets, net 98,121 108,889
Goodwill 184,293 183,650
Investments and other assets 1,374 4,974
-------------- --------------
Total assets $428,845 $472,788
============== ==============
LIABILITIES & STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable $3,377 $6,581
Accrued expenses 70,981 65,454
Current portion of deferred revenue 57,151 69,532
Current portion of notes payable 19,759 22,853
-------------- --------------
Total current liabilities 151,268 164,420
-------------- --------------
Non-current Liabilities:
Deferred revenue, net of
current portion 3,862 5,646
Notes payable, net of
current portion 35,868 46,467
Deferred taxes 5,912 6,644
-------------- --------------
Total non-current liabilities 45,642 58,757
-------------- --------------
Contingencies
Stockholders' Equity
Preferred stock, $0.0001 par value,
5 million shares authorized,
no shares issued or outstanding -- --
Common stock, $0.0001 par value,
100 million shares authorized,
15.1 million and 15.0 million
shares issued and outstanding,
respectively 2 2
Additional paid-in capital 270,921 270,004
Subscriptions receivable (64) (64)
Accumulated deficit (36,758) (17,868)
Accumulated other comprehensive loss (2,166) (2,463)
-------------- --------------
Total stockholders' equity 231,935 249,611
-------------- --------------
Total liabilities and
stockholders' equity $428,845 $472,788
============== ==============
PEREGRINE SYSTEMS, INC.
Condensed Consolidated Statements of Operations
(in thousands, except per share amounts; unaudited)
Successor Company(1) |
----------------------- | Predecessor
Three Months 74 Days | Company(1)
--------- | 18 Days
Ended Ended | Ended
Sept. 30, Sept. 30, | July 18,
2004 2003 | 2003
------------ --------- | -------------
|
Revenue: |
Licenses $15,623 $14,052 | $1,050
Maintenance 28,315 17,792 | 4,328
Consulting and training 3,996 3,376 | 821
-------- -------- | --------
Total revenue 47,934 35,220 | 6,199
-------- -------- | --------
|
Costs and Expenses: |
Cost of licenses 323 310 | 75
Cost of maintenance 4,434 3,441 | 837
Cost of consulting and |
training 4,410 3,371 | 820
Sales and marketing 15,583 9,370 | 2,079
Research and development 6,824 5,917 | 1,439
General and administrative 12,192 8,215 | 1,993
Amortization of intangible |
assets 5,783 4,702 | --
-------- -------- | --------
Total operating costs |
and expenses 49,549 35,326 | 7,243
-------- -------- | --------
|
Operating loss (1,615) (106) | (1,044)
Foreign currency transaction |
gains, net 73 314 | 76
Reorganization items, net (335) (3,806) | 386,148
Interest income 333 374 | --
Interest expense (1,041) (1,511) | (725)
-------- -------- | --------
|
(Loss) income before |
income taxes (2,585) (4,735) | 384,455
Income tax expense (1,093) (660) | (1,144)
-------- -------- | --------
Net (loss) income $(3,678) $(5,395) | $383,311
======== ======== | ========
|
Net (loss) income per |
share, basic: |
Net (loss) income per share $(0.24) $(0.36) | $1.96
======== ======== | ========
Basic shares used in |
computation 15,052 15,000 | 195,707
======== ======== | ========
|
Net (loss) income per |
share, diluted: |
Net (loss) income per share $(0.24) $(0.36) | $1.83
======== ======== | ========
Diluted shares used in |
computation 15,052 15,000 | 209,368
======== ======== | ========
Note:
(1) Peregrine's financial results for periods after the July 18, 2003
adoption of fresh-start reporting are not comparable to results
reported for prior periods because of differences in the basis of
accounting and the capital structure of the predecessor company and
the successor company.
PEREGRINE SYSTEMS, INC.
Condensed Consolidated Statements of Operations
(in thousands, except per share amounts; unaudited)
Successor Company(1) |
----------------------- | Predecessor
Six Months 74 Days | Company
------------ | 109 Days
Ended Ended | Ended
Sept. 30, Sept. 30, | July 18,
2004 2003 | 2003
------------ --------- | -------------
|
Revenue: |
Licenses $26,768 $14,052 | $13,525
Maintenance 53,552 17,792 | 29,176
Consulting and training 7,788 3,376 | 5,954
-------- -------- | --------
Total revenue 88,108 35,220 | 48,655
-------- -------- | --------
|
Costs and Expenses: |
Cost of licenses 722 310 | 706
Cost of maintenance 8,978 3,441 | 5,152
Cost of consulting and |
training 8,295 3,371 | 5,289
Sales and marketing 31,857 9,370 | 14,588
Research and development 14,332 5,917 | 8,908
General and administrative 25,011 8,215 | 13,953
Amortization of intangible |
assets 11,614 4,702 | --
Restructuring and other -- -- | (1,239)
-------- -------- | --------
Total operating costs |
and expenses 100,809 35,326 | 47,357
-------- -------- | --------
|
Operating (loss) income from |
continuing operations (12,701) (106) | 1,298
Foreign currency transaction |
(losses) gains, net (996) 314 | (998)
Reorganization items, net (1,146) (3,806) | 378,821
Interest income 582 374 | 618
Interest expense (2,257) (1,511) | (4,706)
-------- -------- | --------
|
(Loss) income from continuing |
operations before income taxes (16,518) (4,735) | 375,033
Income tax expense on |
continuing operations (2,372) (660) | (1,096)
-------- -------- | --------
|
(Loss) income from continuing |
operations (18,890) (5,395) | 373,937
Income from discontinued |
operations, net of income |
taxes -- -- | 252
-------- -------- | --------
|
Net (loss) income $(18,890) $(5,395) | $374,189
======== ======== | ========
|
Net (loss) income per share, |
basic: |
(Loss) income per share |
from continuing operations $(1.26) $(0.36) | $1.91
Income per share from |
discontinued operations -- -- | --
-------- -------- | --------
Net (loss) income per share $(1.26) $(0.36) | $1.91
======== ======== | ========
Basic shares used in |
computation 15,037 15,000 | 195,654
======== ======== | ========
|
Net (loss) income per share, |
diluted: |
(Loss) income per share |
from continuing operations $(1.26) $(0.36) | $1.82
Income per share from |
discontinued operations -- -- | --
-------- -------- | --------
Net (loss) income per share $(1.26) $(0.36) | $1.82
======== ======== | ========
Diluted shares used in |
computation 15,037 15,000 | 208,302
======== ======== | ========
Note:
(1) Peregrine's financial results for periods after the July 18, 2003
adoption of fresh-start reporting are not comparable to results
reported for prior periods because of differences in the basis of
accounting and the capital structure of the predecessor company and
the successor company.
| |
SOURCE Peregrine Systems, Inc.
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Related links:
http://www.peregrine.com
Photo Notes:
NewsCom:
http://www.newscom.com/cgi-bin/prnh/20031119/SDPERELOGO
AP Archive: http://photoarchive.ap.org
PRN Photo Desk, photodesk@prnewswire.com
CONTACT:
Investor Relations, Heidi Flannery of Ficomm,
+1-503-203-8808, ext. 103, heidi.flannery@ficomm.com, for
Peregrine Systems, Inc.; or Media Relations, MeeLin Nakata of
Peregrine Systems, Inc., +1-858-720-5609,
meelin.nakata@peregrine.com; or Media Relations, Linda Findley of
Text 100, +1-415-836-5990, peregrine@text100.com, for Peregrine
Systems, Inc.; or Industry Analyst Relations, Beth Johnson of
Peregrine Systems, Inc., +1-415-283-5221,
elizabeth.johnson@peregrine.com
| |
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