Message #17 From:
NewsBot Date: November 9, 2005 11:00:00 AM
AMSI News Artemis Reports Third Quarter 2005 Financial Results
NEWPORT BEACH, Calif.--(BUSINESS WIRE)--Nov. 9, 2005--Artemis International Solutions Corp. (OTCBB:AMSI), a leading provider of Investment Planning and Control(TM) solutions, today reported its financial results for the third quarter ended Sept. 30, 2005.
Artemis reported $10.1 million in total revenue for the third quarter ended Sept. 30, 2005, with software license revenue of $1.7 million, compared to $11.0 million in total revenue and $2.4 million in software license revenue for the third quarter of 2004. Support revenue remained steady at $4.3 million and services revenue decreased by $0.2 million to $4.1 million for the third quarter of 2005.
The company reported a non-GAAP loss of $(1.1) million, or $(0.10) per common share, for the third quarter of 2005, compared to a non-GAAP loss of $(1.3) million, or $(0.13) per common share, in the third quarter of 2004. Non-GAAP loss for the third quarter of 2005 excludes $0.2 million in amortization expenses, while non-GAAP loss for the third quarter of 2004 excludes $1.0 million in amortization expenses and $0.6 million in restructuring charges.
On a U.S. GAAP basis, the company's net loss for the third quarter of 2005 was $(1.3) million, or $(0.12) per common share. This compares to a net loss of $(2.9) million, or $(0.30) per common share, for the third quarter of 2004.
"Although our pipeline for Q4 remains solid and sales of our Artemis 7-based solutions grew by 65% year-to-date compared to the same period in 2004, our Q3 performance was clearly below plan," said Patrick Ternier, president and CEO of Artemis. "Still, given our geographical revenue mix, with more than 60% of our revenues coming from Europe, Q3 is usually our weakest quarter. And, our Q3 performance this year was impacted, in part, both by a number of deals slipping into the fourth quarter and a longer-than-expected ramp-up of our U.S. operations. In addition, during Q3, we initiated cost savings measures extending beyond those implemented earlier in the year, which are expected to positively impact our cost structure in 2006," Ternier explained.
For the nine months ended Sept. 30, 2005, Artemis reported $34.4 million in revenue, a non-GAAP loss of $(2.0) million, and a U.S. GAAP net loss of $(3.5) million or $(0.33) per common share. This compares to $38.0 million in revenue, a non-GAAP loss of $(3.5) million, and a U.S. GAAP net loss of $(8.7) million or $(0.87) per common share for the same period in 2004. Non-GAAP loss for the nine months ended Sept. 30, 2005, excludes amortization expense of $1.5 million. Non-GAAP loss for the nine months ended Sept. 30, 2004, excludes amortization expense of $3.1 million and restructuring charges of $2.0 million.
The company's strategic product platform, Artemis 7, grew by 63% and represented 65% of total software license revenue for the nine months ended Sept. 30, 2005, compared to 35% for the same period in 2004.
Artemis has scheduled a conference call to discuss the Q3 2005 results today, Wednesday, Nov. 9, 2005, at 4:30 p.m. (EST). Dial 877-246-9127 or 206-902-3257. For those unable to participate, there will be a telephonic replay available from Nov. 9, 2005, at 5:30 p.m. (EST), through Dec. 9, 2005, 11:59 p.m. (EST). Dial: 800-207-7077 or 913-383-5767. Enter PIN: 4140.
ARTEMIS INTERNATIONAL SOLUTIONS CORP.
Consolidated Financial Highlights
(Unaudited)
Three Months Ended Sept. 30,
-----------------------------------
Percent Percent
of Total of Total
2005 Revenues 2004 Revenues
-------- -------- -------- --------
(in thousands, except per share
data)
Statement of Operations Data:
Revenue:
Software $1,698 16.9% $2,388 21.7%
Support 4,297 42.7% 4,299 39.0%
Services 4,080 40.6% 4,322 39.3%
-------- --------
10,075 100.0% 11,009 100.0%
Cost of revenue:
Software 144 1.4% 53 0.5%
Support 1,166 11.6% 1,481 13.4%
Services 3,391 33.7% 3,814 34.6%
-------- --------
4,701 46.7% 5,348 48.6%
-------- --------
Gross margin 5,374 53.3% 5,661 51.4%
Operating expenses:
Selling and marketing 3,377 33.6% 2,969 27.0%
Research and development 1,872 18.5% 1,689 15.3%
General and administrative 1,531 15.2% 1,798 16.3%
Amortization expense 212 2.1% 1,030 9.4%
Restructuring charge - 0.0% 654 5.8%
-------- --------
6,992 69.4% 8,140 73.9%
-------- --------
Operating loss (1,618) -16.1% (2,479) -22.5%
Net interest expense 211 2.1% 236 2.1%
Other non-operating expense
(income), net (188) -2.0% 60 0.5%
Foreign exchange (gain) loss (463) -4.6% 261 2.4%
-------- --------
(440) -4.4% 557 5.1%
-------- --------
Loss before income taxes (1,178) -11.7% (3,036) -27.6%
Income tax expense (benefit) 169 1.7% (63) -0.6%
-------- --------
Net Loss $(1,347) -13.4% $(2,973) -27.0%
======== ========
Basic and diluted loss per
common share $(0.12) $(0.30)
======== ========
Weighted average common shares
used in computing basic and
diluted loss per common share 10,826 9,965
======== ========
Reconciliation of net loss to non-
GAAP income (loss):
----------------------------------
Net loss $(1,347) $(2,973)
Amortization 212 1,030
Restructuring charges - 654
-------- --------
Non-GAAP income (loss) (1) $(1,135) $(1,289)
======== ========
Basic non-GAAP income (loss)
per common share $(0.10) $(0.13)
======== ========
Weighted average common shares
used in computing basic non-
GAAP income (loss) per common
share 10,826 9,965
======== ========
Nine Months Ended Sept. 30,
-----------------------------------
Percent Percent
of Total of Total
2005 Revenues 2004 Revenues
-------- -------- -------- --------
(in thousands, except per share
data)
Statement of Operations Data:
Revenue:
Software $7,819 22.7% $8,513 22.4%
Support 13,104 38.1% 12,816 33.7%
Services 13,493 39.2% 16,727 44.0%
-------- --------
34,416 100.0% 38,056 100.0%
Cost of revenue:
Software 305 0.9% 146 0.4%
Support 3,714 10.8% 4,342 11.4%
Services 11,143 32.4% 13,362 35.1%
-------- --------
15,162 44.1% 17,850 46.9%
-------- --------
Gross margin 19,254 55.9% 20,206 53.1%
Operating expenses:
Selling and marketing 11,197 32.6% 10,567 27.8%
Research and development 5,776 16.8% 5,797 15.2%
General and administrative 5,252 15.3% 6,475 17.0%
Amortization expense 1,489 4.3% 3,088 8.1%
Restructuring charge - 0.0% 2,049 5.4%
-------- --------
23,714 68.9% 27,976 73.5%
-------- --------
Operating loss (4,460) -13.0% (7,770) -20.4%
Net interest expense 525 1.5% 444 1.2%
Other non-operating expense
(income), net (1,164) -3.5% (219) -0.6%
Foreign exchange (gain) loss (857) -2.5% 352 0.9%
-------- --------
(1,496) -4.3% 577 1.5%
-------- --------
Loss before income taxes (2,964) -8.6% (8,347) -21.9%
Income tax expense (benefit) 523 1.5% 318 0.8%
-------- --------
Net Loss $(3,487) -10.1% $(8,665) -22.8%
======== ========
Basic and diluted loss per
common share $(0.33) $(0.87)
======== ========
Weighted average common shares
used in computing basic and
diluted loss per common share 10,666 9,965
======== ========
Reconciliation of net loss to non-
GAAP income (loss):
----------------------------------
Net loss $(3,487) $(8,665)
Amortization 1,489 3,088
Restructuring charges - 2,049
-------- --------
Non-GAAP income (loss) (1) $(1,998) $(3,528)
======== ========
Basic non-GAAP income (loss)
per common share $(0.19) $(0.35)
======== ========
Weighted average common shares
used in computing basic non-
GAAP income (loss) per common
share 10,666 9,965
======== ========
(1) Non-GAAP income (loss) represents net earnings (loss) before
amortization, impairment and restructuring charges. Non-GAAP
income (loss) is not indicative of cash provided by or used in
operating activities and may differ from comparable information
provided by other companies. Non-GAAP income (loss) should not be
considered in isolation, as an alternative to, or more meaningful
than measures of financial performance determined in accordance
with accounting principles generally accepted in the United
States. Non-GAAP income (loss) is used elsewhere in the industry
and is presented because Artemis believes it provides relevant and
useful information to investors. Artemis utilizes non-GAAP income
(loss) to provide additional information with respect to its
ability to meet future capital expenditures and working capital
requirements, to incur indebtedness if necessary, and to fund
continued growth. Although restructuring charges represent a cash
requirement for the company, management believes that "non-GAAP
income (loss)," which excludes restructuring charges, is more
meaningful to investors than EBITDA (Earnings Before Interest,
Taxes, Depreciation and Amortization), a financial metric reported
by the company in previous earnings releases. Investors could use
such a measure to analyze and compare companies on the basis of
current period operating performance.
About Artemis International Solutions Corp.
Artemis International Solutions Corp. (OTCBB:AMSI) is one of the world's leading providers of investment planning and control solutions that help organizations execute strategy through effective portfolio and project management. Artemis has refined 30 years' experience into a suite of solutions and packaged consulting services that address the specific needs of both industry and the public sector including new product development, IT management, program management, and strategic asset optimization. With a global network covering 44 countries, Artemis is helping thousands of organizations to improve their business performance through better alignment of strategy, investment planning and project execution. For more information, visit www.aisc.com.
Forward-Looking Statements
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: This press release contains or may contain forward-looking statements such as statements regarding the company's growth and profitability, growth strategy, liquidity and access to public markets, operating expense reduction and trends in the industry in which the company operates. The forward-looking statements contained in this press release are also subject to other risks and uncertainties, including those more fully described in the company's filings with the Securities and Exchange Commission. The company assumes no obligation to update these forward-looking statements to reflect actual results, changes in risks, uncertainties or assumptions underlying or affecting such statements or for prospective events that may have a retroactive effect.
