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PRESS RELEASES
ARTISOFT ANNOUNCES
STRONG REVENUE GROWTH FOR FIRST QUARTER OF FISCAL 2005
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First
quarter revenue up 49% over Q1 2004
Cambridge, MA - December 2 - Artisoftİ, Inc. (OTC:
ASFT), a leading provider of IP-PBX and call center
products, today reported its financial results for the
first quarter of fiscal 2005, which ended September
30, 2004. Revenue for the quarter increased 49% from
the same quarter of fiscal 2004. The Company also
achieved its 8th consecutive quarter of revenue
growth.
For the first quarter of fiscal 2005, Artisoft
reported revenue of $2.9 million and a net loss of
$2.9 million, or 61 cents per share, compared to
revenue of $2.0 million and a net loss of $4.1
million, or $1.30 per share, during the same quarter
of fiscal 2004. Revenue for the first quarter of
fiscal 2005 included $0.5 million in revenue derived
from Artisoft's acquisition of Vertical Networks.
The results for each quarter included non-cash deemed
dividends to the holders of preferred stock. For the
first quarter of fiscal 2005, a non-cash deemed
dividend of $1.5 million, or 31 cents per share,
resulted from the repricing of warrants associated
with preferred stock, and this non-cash expense is
reflected in the loss reported above. All of the
Company's outstanding shares of preferred stock
converted into common stock prior to the Company's
previously announced common stock financing completed
on September 28 and October 1, 2004. A similar deemed
dividend of $4.1 million, or 99 cents per share, was
recognized in the results of the first quarter of
fiscal 2004 as the result of repricing of warrants,
and anti-dilution benefits of the preferred stock then
outstanding, as a result of the Company's September
2003 financing. Also included in the results for first
quarter of fiscal 2005 were the severance expenses of
$0.5 million or 10 cents per share, associated with
the Company's former CEO.
Operating expenses for the quarter were $4.0 million,
compared to $2.9 million during first quarter of
fiscal 2004. Operating expenses for the quarter
include some expenses related to internal costs
associated with the acquisition of Vertical Networks.
Operating expenses also include $0.5 million of
severance expenses associated with the Company's
former CEO. Gross margins during the first quarter of
fiscal 2005 were 88% as compared to 97% for the first
quarter of fiscal 2004.
"The significant revenue growth in the quarter
reflects the continued adoption of TeleVantage by
customers who are looking for the benefits of our
flexibility and advanced knowledge worker applications
versus traditional PBX and IP-PBX systems," said Bill
Tauscher, Artisoft's president and CEO. "We continue
to see increasing activity in our channels and new
opportunities for both the InstantOffice and
TeleVantage product lines. We are especially excited
about our partnerships with Vertical Networks' large
system integration partners and how they expand the
scope of the market that we can access and we expect
to see the returns from these relationships grow in
the coming quarters. We're also tremendously excited
by the advances that the Company is working to develop
by combining the advanced technologies from both
products."
Artisoft will hold a conference call at 5:00 p.m. ET
today to discuss the first quarter fiscal year 2005
financial results. The conference call will be
broadcast live via the Internet at the Investor
Relations section of Artisoft's website, http://www.artisoft.com/corpcalls.html.
A recorded replay of the conference call will be
available 24 hours per day beginning on Thursday,
December 2, 2004 at 8:00 p.m. ET at the Investor
Relations section of Artisoft's website, http://www.artisoft.com/corpcalls.html.
About Artisoft
Artisoft, Inc. is a leading provider of server-based
PBX, IP-PBX and call center products that deliver
enhanced communications capabilities to highly
distributed large enterprises, medium-size businesses,
branch offices, and call centers. Artisoft's
innovative products have consistently garnered
industry recognition, winning more than 40 awards for
technical excellence. The Company distributes its
products and services worldwide through select system
integration partners, and a dedicated and growing
channel of authorized resellers. For more information,
please call 800-914-9985 or visit our website at
http://www.artisoft.com.
Click Here For Tabular Data
Artisoft, TeleVantage and InstantOffice are registered
trademarks of Artisoft, Inc. All other Company and
product names mentioned may be trademarks or
registered trademarks of the respective companies with
which they are associated.
Forward-Looking Statements:
This release contains forward-looking statements based
on current expectations or beliefs, as well as a
number of assumptions about future events, and these
statements are subject to important facts and
uncertainties that could cause actual results to
differ materially from those described in the
forward-looking statements. The forward-looking
statements in this release address a variety of
subjects, including, without limitation, the
increasing attractiveness of TeleVantage and
InstantOffice versus proprietary PBX and IP-PBX
systems, the ability of our North American,
International and OEM channels to continue to perform
well, and the advances we may make by combining
Artisoft and Vertical Networks' technologies. The
following factors, among others, could cause actual
results to differ materially from those described in
these forward- looking statements: our ability to
integrate the operations of Vertical Networks and
realize anticipated synergies, cost savings and other
benefits, including the opportunity to integrate
Artisoft and Vertical Networks technologies, our
dependency on OEM channels that may fail to perform,
our dependency on, in some cases a small number of
customers and suppliers, risks associated with the
Company's strategic transactions and strategic
alliances, the impact of competitive products and
pricing, the ability of our distributors, resellers
and our original equipment manufacturers to market
TeleVantage and InstantOffice, and pay us for the
products they purchase from us, product demand and
market acceptance risks, the presence of competitors
with greater financial resources, product development
and commercialization risks, risks and costs
associated with acquisitions and the integration and
administration of acquired operations, capacity and
supply constraints or difficulties and other factors
detailed in the Company's filings with the Securities
and Exchange Commission including its most recent
filings on Form 10-K.
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