AXS-One Reports Second Quarter Financial Results * License revenue
up 33% YTD - down $350,000 versus Q2 '03 RUTHERFORD, N.J., July 29
/PRNewswire-FirstCall/ -- AXS-One Inc. (AMEX:AXO), a leading
provider of Records Compliance Management (RCM) software solutions
today announced its financial results for the second quarter and
six-month period ended June 30, 2004. The Company also announced
significant restructuring during the second quarter, designed to
improve the organization's competitive position by aligning its
operations for future growth in the RCM market while servicing
existing enterprise customers worldwide more effectively. Financial
results for the quarter were impacted by restructuring and other
costs of $1.1 million related to severance and retirement related
costs to the former CEO. In addition, the quarter was impacted by
costs associated with implementing the infrastructure to exploit
the growing RCM market. Revenues for the quarter were $9.5 million,
a slight decrease from the $9.6 million reported in the
corresponding prior year period. License revenues were $1.0
million, including $0.8 million (80 percent) related to e-mail
management and archiving products, a decrease of 26 percent from
the $1.3 million in total license revenues reported in the same
quarter last year. Operating expenses, including the $1.1 million
in restructuring and other costs, increased 28 percent as
management focused on improving key aspects of the organization,
including sales, marketing and research and development, with the
goal of rationalizing its product mix and revenue opportunities.
Sales and marketing expenses increased 16 percent and R&D
expenses increased 29 percent. The Company reported an operating
loss of $2.5 million versus operating income of $157,000 in the
second quarter of 2003. The Company reported a net loss of $2.6
million, or ($0.09) per diluted share, versus net income of
$155,000, or $0.01 per diluted share last year. For the quarter, 65
percent of the license revenue recognized was with customers inside
the United States, while 35 percent was recognized internationally.
For the first six months of 2004, revenues increased 7.3 percent to
$20.4 million, compared to $19.0 million reported for the first six
months of 2003. License fees increased 33 percent to $3.5 million
compared to license fees of $2.6 million for the first six months
of 2003. Total operating expenses, including the restructuring and
other costs, increased 21 percent to $22.1 million compared to
$18.4 million for the first six months of 2003. The Company
reported an operating loss of $1.7 million compared to operating
income of $677,000 for the first six months of 2003. The net loss
for the six-month period was $1.8 million, or ($0.07) per diluted
share, compared to net income of $582,000, or $0.02 per diluted
share, for the first six months of 2003. The Company's balance
sheet reported $9.2 million in cash as of June 30, 2004, compared
to cash of $2.9 million as of December 31, 2003, the result of the
$7.7 million private placement completed in April 2004. The Company
carries no long-term debt. During the quarter, management embarked
on a restructuring effort, eliminating 36 positions around the
world and reorganizing to focus on higher growth products within
its Records Compliance Management solutions. As a result of these
initiatives, the Company incurred $0.8 million of severance costs
which are included in the $1.1 million total restructuring and
other costs. Management believes the restructuring will provide
approximately $3.2 million in annual working capital savings which
will be used to invest in the growth of its Records Compliance
Management solutions and ensure the Company's long-term
profitability. "AXS-One is uniquely positioned from a technology
standpoint, with a comprehensive compliance offering, including
e-mail management, that satisfies the growing and much publicized
need for corporate governance and regulatory compliance worldwide,"
commented Bill Lyons, AXS-One's Chief Executive Offer. "My first
goal was to package our product offering so it is suitable for the
reseller channel. In order to accomplish this we conducted a
reorganization of our Company, aligning our workforce with our
needs both from a product development, as well as a marketing
standpoint. I firmly believe that the Company is now in an
excellent position to capitalize on the opportunities which are
before us." The Company executed two significant partnerships
during the quarter and made progress on other channel initiatives:
* An alliance was entered into with Sun Microsystems, whereby Sun
will resell the AXS-One(R) Compliance Platform to its existing
enterprise customers and new customers in targeted markets. As an
accredited Sun iForce(SM) partner, AXS-One has collaborated with
Sun to test and optimize its compliance solution for the Sun
platform. * AXS-One signed an agreement with RedFile, a digital
risk and information management solution provider, to
collaboratively develop and offer a comprehensive hosted active
archival solution designed to help corporations meet evolving
regulations, expedite legal discovery and streamline Records
Management. Under the terms of the agreement, RedFile will resell
the AXS-One(R) Compliance Platform as well as provide a hosted
option for organizations to outsource their records retention
needs. * At the end of Q1, AXS-One announced a strategic alliance
with Sector, a leading managed services provider to the financial
services industry. During Q2 four new accounts, including one of
the 25 largest banks in the world, chose the AXS-One/Sector
solution to address regulatory compliance, operational efficiency
and Records Management of all electronic communication. * The
AXS-Link(TM) for SAP product, announced during the first quarter,
received significant acclaim at SAP's Sapphire Asia Pacific
conference at the beginning of June. The Company expects to
finalize reseller agreements for this product as well as complete
sales in multiple geographies through the remainder of 2004. * The
AXS-One e-delivery solution has been implemented by one of the
largest travel agencies in the UK. AXS-One will begin monthly
revenue recognition of this solution and expect to gain wider
traction in this market in Q3. In addition, AXS-One has signed a 3
year deal with one of the major European ferry companies. Mr. Lyons
continues, "We believe these partnerships validate the competitive
position of our software-based solutions, and demonstrate that
large, established companies are interested in partnering with
AXS-One to market our software to their customers and prospects.
Based on my success forging high profile partnerships in previous
assignments, I recognize the immense leverage these relationships
can provide. Aligning with such companies as Sun, SAP, Sector and
RedFile provide an established base of potential customers and
increase our visibility without the substantial increases in
infrastructure typically required in a direct selling model." Mr.
Lyons concludes, "We now have a streamlined organization and are
positioned to successfully grow revenues with an emphasis on
profitability. Clearly, this was a challenging quarter for our
organization, but I am extremely confident about our ability to
capitalize on future opportunities." About AXS-One Inc. AXS-One
(AMEX:AXO) is a leading provider of Records Compliance Management
software. The AXS-One Compliance solutions provide a platform for
regulatory compliance, corporate governance and operational
efficiency. AXS-One's Web Services-based technology has been
critically acclaimed as best of class. AXS-One's high-volume,
interoperable, scalable and secure business solutions have been
implemented by the global 2000. AXS-One has offices worldwide,
including United States, Australia, Singapore, United Kingdom and
South Africa. AXS-One was founded in 1978, and is headquartered in
Rutherford, New Jersey, U.S.A. For further information, visit the
AXS-One web site at http://www.axsone.com/. AXS-One, the AXS-One
logo, "Access Tomorrow Today," AXSPoint and TransAXS are registered
trademarks of, and 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: 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 Securities and Exchange Commission filings. For further
information, please contact William Levering of AXS-One Inc.,
+1-201-935-3400, ; or IR contact, Matthew Hayden of Hayden
Communications, +1-858-456-4533, . AXS-ONE INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per
share data) (unaudited) Three Months Ended Six Months Ended June
30, June 30, June 30, June 30, 2004 2003 2004 2003 Revenues:
License fees $1,004 $1,354 $3,464 $2,595 Services 8,451 8,160
16,862 16,249 Other - related parties 50 74 101 189 Total revenues
9,505 9,588 20,427 19,033 Operating expenses: Cost of license fees
375 378 786 719 Cost of services 4,528 4,003 8,797 7,967 Sales and
marketing 2,455 2,124 4,425 3,755 Research and development 2,037
1,578 3,936 3,252 General and administrative 1,530 1,348 3,097
2,663 Restructuring and other costs 1,103 -- 1,103 -- Total
operating expenses 12,028 9,431 22,144 18,356 Operating income
(loss) (2,523) 157 (1,717) 677 Other income (expense): Interest
income 40 20 65 32 Interest expense (2) (46) (14) (119) Gain on
sale of subsidiary -- -- -- 71 Equity in income (losses) of joint
venture (49) 134 (82) 115 Other expense, net (18) (82) (51) (166)
Other income (expense), net (29) 26 (82) (67) Net income (loss)
before income taxes (2,552) 183 (1,799) 610 Income tax expense (28)
(28) (28) (28) Net income (loss) $(2,580) $155 $(1,827) $582 Basic
net income (loss) per common share $(0.09) $0.01 $(0.07) $0.02
Weighted average basic common shares outstanding 27,915 24,960
26,582 24,913 Diluted net income (loss) per common share $(0.09)
$0.01 $(0.07) $0.02 Weighted average diluted common shares
outstanding 27,915 25,462 26,582 25,773 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
BALANCE SHEETS (In thousands) June 30, December 31, 2004 2003
ASSETS (Unaudited) Current assets: Cash and cash equivalents $9,216
$2,946 Accounts receivable, net of allowance for doubtful accounts
7,549 5,541 Due from joint venture 96 107 Prepaid expenses and
other current assets 773 659 Total current assets 17,634 9,253
Equipment and leasehold improvements, net of accumulated
depreciation 412 336 Capitalized software development costs, net of
accumulated amortization 2,348 2,364 Other assets 199 197 Total
assets $20,593 $12,150 LIABILITIES AND STOCKHOLDERS' EQUITY
(DEFICIT) Current liabilities: Current portion of long-term debt
$-- $547 Accounts payable and accrued expenses 6,208 4,848 Due to
joint venture 62 4 Deferred revenue 10,879 8,946 Total current
liabilities 17,149 14,345 Long-term deferred revenue 915 1,504
Stockholders' equity (deficit): 2,529 (3,699) Total liabilities and
stockholders' equity (deficit) $20,593 $12,150 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
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: William Levering of AXS-One Inc.,
+1-201-935-3400, ; or IR contact, Matthew Hayden of Hayden
Communications, +1-858-456-4533, Web site: http://www.axsone.com/
Copyright
Axos Financial (NYSE:AXO)
Historical Stock Chart
From Jul 2024 to Aug 2024
Axos Financial (NYSE:AXO)
Historical Stock Chart
From Aug 2023 to Aug 2024