RUTHERFORD, N.J., Feb. 9 /PRNewswire-FirstCall/ -- AXS-One Inc.
(AMEX:AXO), a leading provider of high performance Records
Compliance Management (RCM) software solutions today announced its
financial results for the fourth quarter and fiscal year ended
December 31, 2005. Total license revenues for the fourth quarter
decreased 27 percent to $1.5 million from $2.0 million in the
fourth quarter of 2004, and 41 percent sequentially when compared
with the $2.5 million for the third quarter of 2005. Records
Compliance Management (RCM) license revenues recognized in the
quarter were $1.3 million, an increase of 58 percent compared to
the fourth quarter of 2004. Total operating expenses for the
quarter were $9.4 million, a decrease of 15 percent compared to the
fourth quarter of 2004. The Company reported a net loss of $1.6
million for the fourth quarter, or $(0.05) per diluted share
compared to a net loss of $1.7 million in the fourth quarter of
last year, or $(0.06) per diluted share. In December 2005 the
Company received an RCM order from a major US health care provider
for approximately $750,000. The order was not recognized as license
revenue during the fourth quarter but payment was received during
the first week of January 2006. This sale will be recorded as
deferred revenue until all contract terms have been satisfied.
Revenues for fiscal 2005 were $32.8 million, a decrease of 15
percent from the $38.4 million reported in the prior year. License
revenues for the year decreased 18 percent to $5.5 million from
$6.8 million in 2004. RCM license revenue represented 74 percent of
total license revenue in 2005, compared to 64 percent in 2004. RCM
service revenues increased 25 percent for the same period.
Operating expenses decreased 6 percent to $41.4 million compared to
$44.0 million reported for fiscal 2004. The company reported a net
loss of $9.0 million or ($0.28) per diluted share, compared to a
net loss of $5.2 million, or $(0.19) per diluted share in 2004. The
Company had $3.6 million in cash and equivalents at December 31,
2005 compared to the $4.8 million reported at December 31, 2004.
Currently the Company has approximately $8.7 million in cash, which
increased from year end due to the prepayment of maintenance fees,
specifically by one large customer, and the payment associated with
the aforementioned license deal. The prepayment of maintenance fees
by the one large customer will be recorded over a three year time
period starting in the first quarter of 2006. As of the end of the
fourth quarter the Company had $4.0 million available under its
existing bank line of credit. Highlights from the Fourth Quarter
include: * Five new customer wins for the AXS-One Compliance
Platform(TM) on three continents, four closed with partners
representing key wins against competitors. Key wins include
contracts with a major government agency in South Africa, a large
international supermarket chain in Hong Kong, an international
consumer goods manufacturing company, a major international wine
producer and one of Australia's largest electric utilities. * First
major wins in South Africa and Hong Kong for the RCM platform. *
Virgin Travel becomes AXS-One's 50th contracted customer for
AXS-One's e-Delivery Service for Tour Operators * General
Availability of AXS-Link for Desktop, a major enhancement to the
AXS-One Compliance Platform delivering a comprehensive desktop
archiving solution. * Continued expansion of the company's reseller
channel, with new partnerships announced throughout Asia, including
China, Hong Kong, India, Malaysia, the Philippines and Thailand
Highlights from the 2005 Year include: * Technology Development and
License Agreement signed with Sun Microsystems. AXS-One joins Sun
to deliver an integrated solution for compliance, governance and
operational management and announces first sales worldwide. *
Secured more than 30 Resellers in twenty countries, forming a
meaningful foundation for 2006 business. * Channel shows early
signs of success with joint wins announced worldwide. * Major new
release of AXS-One Compliance Platform announced. Version 3.5
introduces patent-pending search technology, setting new standard
for performance in the archiving market. The Company announced the
appointment of Rob Milks as Senior Vice President Sales, AXS-One
North America. Mr. Milks replaced Matt Suffoletto who has left the
company to pursue other interests. Mr. Milks has over twenty years
of software sales experience including executive positions at
Selectica Inc. and Blue Roads Corporation. Commenting on the
change, Bill Lyons, chairman and CEO of AXS-One stated, "Under
Rob's lead the North American sales team is well positioned and I
am confident in their ability to capture new sales within the
growing RCM marketplace." Commenting on the Company's financial
results, Bill Lyons continued, "During 2005 we made further
progress in growing our RCM business by continuing to convey the
tangible benefit of deploying AXS-One solutions to potential
customers. Increasing consumer interest translated into important
wins for our RCM solutions during the third and fourth quarters. To
further drive license sales we are expanding our channel strategy
and now have more than 30 resellers in place and are experiencing
early indications that our new partners are beginning to
meaningfully contribute to our revenues. In particular, our
relationship with Sun continues to strengthen, with our first joint
sales closed as a result of this partnership in Europe, Australia
and North America during 2005. While last year has been challenging
in terms of our ability to provide consistent and predictable
growth, we enter 2006 with a stable balance sheet, robust pipeline,
expanding services backlog and a significantly stronger reseller
channel. We continue to have confidence in our ability to further
leverage the initial product momentum gained during 2005 by
transitioning our initial successes into tangible operational
improvements throughout 2006." Conference call information
Management will conduct a conference call to discuss these results
at 5:00 p.m. Eastern time on February 9, 2006. Interested parties
can participate in the call by dialing 706-645-0399 or can access
the webcast at http://www.axsone.com/. The webcast will be archived
for 30 days following the call. Interested parties may submit
questions during the conference call by e-mail to . Interested
parties may listen to the call via a live webcast that will be
available via the company website http://www.axsone.com/.
Interested parties should access the webcast approximately 10-15
minutes before the scheduled start time. About AXS-One Inc. AXS-One
(AMEX:AXO) is a leading provider of high performance Records
Compliance Management solutions. The AXS-One Compliance Platform
enables organizations to implement secure, scalable and enforceable
policies that address records management for corporate governance,
legal discovery and industry regulations such as SEC17a-4, NASD
3010, Sarbanes-Oxley, HIPAA, The Patriot Act and Gramm-Leach
Bliley. AXS-One's award-winning technology has been critically
acclaimed as best of class and delivers digital archiving, business
process management, electronic document delivery and integrated
records disposition and discovery for e-mail, instant messaging,
images, SAP and other corporate records. Founded in 1979, and
headquartered in Rutherford, NJ, AXS-One has offices worldwide
including in the United States, Australia, Singapore, United
Kingdom and South Africa. For further information, visit the
AXS-One website at http://www.axsone.com/. AXS-One, the AXS-One
logo, "Access Tomorrow Today," AXSPoint, and TransAXS are
registered trademarks of, and AXS-One Compliance Platform, AXS-One
Retention Manager, AXS-One Rapid-AXS, AXS-Link for Desktop, "The
Records Compliance Management Company", e-Cellerator, AXS Desk,
"AXS-One Collaboration FrameWorks," SMART, AXS-Link and Tivity are
trademarks of, AXS-One Inc., in the U.S. All other company and
product names are trademarks or registered trademarks of their
respective companies. Special Note Regarding Forward-Looking
Statements: A number of statements contained in this release are
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995 that involve risks and
uncertainties that could cause actual results to differ materially
from those expressed or implied in the applicable statements. These
risks and uncertainties include, but are not limited to: our
ability to improve financial and sales performance; potential
vulnerability to technological obsolescence; the risks that its
current and future products may contain errors or defects that
would be difficult and costly to detect and correct; potential
difficulties in managing growth; dependence on key personnel; the
possible impact of competitive products and pricing; and other
risks described in more detail in AXO's most current Form 10-K and
other Securities and Exchange Commission filings. Company Contact:
IR Contact: Joseph Dwyer Matthew Hayden AXS-One Inc. Hayden
Communications (201) 935-3400 (858) 704-5065 -Tables Follow-
AXS-ONE INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands) December 31, December 31, 2005 2004 ASSETS
(unaudited) Current assets: Cash and cash equivalents $3,613 $4,809
Accounts receivable, net of allowance for doubtful accounts 5,153
6,084 Due from joint venture -- 68 Prepaid expenses and other
current assets 775 1,283 Total current assets 9,541 12,244
Equipment and leasehold improvements, net of accumulated
depreciation 395 509 Capitalized software development costs, net of
accumulated amortization 1,038 1,886 Other assets 92 142 Total
assets $11,066 $14,781 LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities: Accounts payable and accrued expenses $4,843
$5,687 Due to joint venture 52 29 Deferred revenue 8,224 9,786
Total current liabilities 13,119 15,502 Long-term deferred revenue
63 303 Stockholders' deficit (2,116) (1,024) Total liabilities and
stockholders' deficit $11,066 $14,781 The unaudited financial
information included in this document is intended only as summary
provided for your convenience, and should be read in conjunction
with the complete consolidated financial statements of the Company
(including the Notes thereto, which set forth important
information) contained in its Reports on Form 10-K and 10-Q filed
by the Company with the U.S. Securities and Exchange Commission
(SEC). Such reports are available on the public EDGAR electronic
filing system maintained by the SEC. This press release contains
forward-looking statements. Such statements are only predictions,
and actual events or results may differ materially. All
forward-looking statements involve risks and uncertainties,
including, without limitation, the risks detailed in the Company's
documents and reports filed from time to time with the Securities
and Exchange Commission. AXS-ONE INC. AND SUBSIDIARIES CONSOLIDATED
STATEMENTS OF OPERATIONS (In thousands, except per share data)
Three Months Ended Twelve Months Ended December 31, December 31,
2005 2004 2005 2004 Revenues: (Unaudited) (Unaudited) License fees
$1,478 $2,011 $5,546 $6,781 Services 6,397 6,825 27,154 31,446
Other-related parties 39 28 108 209 Total revenues 7,914 8,864
32,808 38,436 Operating expenses: Cost of license fees 410 444
1,585 1,923 Cost of services 3,551 4,160 16,223 17,086 Sales and
marketing 2,414 2,869 9,743 9,565 Research and development 1,855
1,982 7,828 7,999 General and administrative 1,181 1,600 5,129
6,411 Restructuring and other costs -- -- 863 1,020 Total operating
expenses 9,411 11,055 41,371 44,004 Operating loss (1,497) (2,191)
(8,563) (5,568) Other income (expense): Interest income 51 39 156
144 Interest expense (38) -- (44) (14) Equity in losses of joint
venture (45) (40) (89) (162) Other income (expense), net (118) 239
(483) 171 Other income (expense), net (150) 238 (460) 139 Loss
before income taxes (1,647) (1,953) (9,023) (5,429) Income tax
benefit -- 227 25 217 Net loss $(1,647) $(1,726) $(8,998) $(5,212)
Basic and diluted net loss per common share $(0.05) $(0.06) $(0.28)
$(0.19) Weighted average basic and diluted common shares
outstanding 34,205 28,293 31,629 27,395 The unaudited financial
information included in this document is intended only as summary
provided for your convenience, and should be read in conjunction
with the complete consolidated financial statements of the Company
(including the Notes thereto, which set forth important
information) contained in its Reports on Form 10-K and 10-Q filed
by the Company with the U.S. Securities and Exchange Commission
(SEC). Such reports are available on the public EDGAR electronic
filing system maintained by the SEC. This press release contains
forward-looking statements. Such statements are only predictions,
and actual events or results may differ materially. All
forward-looking statements involve risks and uncertainties,
including, without limitation, the risks detailed in the Company's
documents and reports filed from time to time with the Securities
and Exchange Commission. DATASOURCE: AXS-One Inc. CONTACT: Joseph
Dwyer of AXS-One Inc., +1-201-935-3400, ; or IR, Matthew Hayden of
Hayden Communications, +1-858-704-5065, , for AXS-One Inc. Web
site: http://www.axsone.com/
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