-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, ElOva2e20UMBseWUIWVbJ9rhS9n8NhmLazfNxp8ppoVLmyFEdBbxyuVtGKHTv/uw B5H7v4DRQXj8DUv4AZDGbQ== 0001157523-04-011333.txt : 20041209 0001157523-04-011333.hdr.sgml : 20041209 20041209160533 ACCESSION NUMBER: 0001157523-04-011333 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20041209 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20041209 DATE AS OF CHANGE: 20041209 FILER: COMPANY DATA: COMPANY CONFORMED NAME: VERSATA INC CENTRAL INDEX KEY: 0001034397 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-PREPACKAGED SOFTWARE [7372] IRS NUMBER: 680255203 STATE OF INCORPORATION: DE FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-29757 FILM NUMBER: 041193488 BUSINESS ADDRESS: STREET 1: 300 LAKESIDE DRIVE STE 1500 CITY: OAKLAND STATE: CA ZIP: 94612 BUSINESS PHONE: 5102384105 FORMER COMPANY: FORMER CONFORMED NAME: VISION SOFTWARE TOOLS INC DATE OF NAME CHANGE: 19991115 8-K 1 a4781788.txt VERSATA, INC. 8-K SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): December 9, 2004 VERSATA, INC. (Exact name of Registrant as specified in its charter) DELAWARE 000-29757 68-0255203 (State or other jurisdiction (Commission File No.) (IRS Employer of incorporation or organization) Identification Number) 300 Lakeside Drive, Suite 1300, Oakland, California, 94612 (Address of principal executive office including zip code) (510) 238-4100 (Registrant's telephone number, including area code) Not Applicable (Former name or former address if changed since last report) ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION On December 9, 2004, Versata, Inc. ("Versata") issued a press release announcing its financial results for the fiscal fourth quarter and full year ended October 31, 2004. A copy of Versata's press release is attached hereto as Exhibit 99.1. The information in this Current Report on Form 8-K and the exhibit attached hereto are being furnished pursuant to Item 12 of Form 8-K and shall not, except to the extent required by applicable law or regulation, be deemed filed by Versata for purposes of Section 18 of the Securities Exchange Act of 1934, as amended. ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS The following exhibits are filed as part of this report: EXHIBIT NUMBER DESCRIPTION - ------ ----------- 99.1 Press Release dated December 9, 2004* *This exhibit is furnished to, but not filed with, the Commission by inclusion herein. SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. VERSATA, INC. Date: December 9, 2004 By: /s/ William Frederick --------------------- William Frederick Chief Financial Officer, Secretary and Vice President INDEX TO EXHIBITS EXHIBIT NUMBER DESCRIPTION - ------ ----------- 99.1 Press Release dated December 9, 2004* *This exhibit is furnished to, but not filed with, the Commission by inclusion herein. EX-99.1 2 a4781788ex991.txt VERSATA, INC. EXHIBIT 99.1 Exhibit 99.1 Versata Reports Fourth Quarter and Full Year 2004 Financial Results; Company Reports Fifth Consecutive Quarter of Revenue Growth OAKLAND, Calif.--(BUSINESS WIRE)--Dec. 9, 2004--Versata, Inc. (Nasdaq:VATA), a provider of software and services that automate the development and ongoing management of data-intensive applications, today reported its financial results for the fourth quarter and fiscal year, ended October 31, 2004. Total revenue was $4.1 million, reflecting a 2 percent increase over the prior quarter and a 40 percent increase over the same quarter last year. For the year, total revenue was $15.3 million, up slightly over last fiscal year. Versata has now increased revenue for five consecutive quarters and has, for the first time since becoming a public company, recorded year-over-year revenue growth. Software license revenue increased 16 percent sequentially, from $1.5 million in the third quarter to $1.8 million during the fourth quarter. For the year, software license revenue improved to $5.9 million, up slightly from $5.8 million for fiscal 2003. Gross margin at 68 percent was equal to last quarter, but up substantially from 57 percent a year ago. On the bottom line, Versata's $483,000, or $0.06 per share, GAAP net loss was less than half its third quarter net loss of $1.1 million, or $0.13 per share, and a 90 percent improvement from the $4.7 million, or $0.61 per share, net loss in the prior year period. The non-GAAP net loss for the fourth quarter was $56,000, or $0.01 per share, substantially better than the $316,000 or $0.04 per share, non-GAAP net loss during the third quarter, and the $2.1 million, or $0.28 per share, non-GAAP net loss in the prior year period. For the fiscal year, Versata's GAAP net loss shrank to $4.8 million, or $0.59 per share, from $10.8 million, or $1.45 per share, for 2003. On a non-GAAP basis, the company reduced its net loss by 33 percent, to $2.8 million, or $0.35 per share, from $4.2 million, or $0.57 per share, for the prior fiscal year. Versata also reduced its cash burn to $418,000 this quarter from $452,000 last quarter. This is significant because the number of maintenance and support renewals that come due in the fourth quarter is substantially lower than in any other quarter during the year. On the customer front, Versata sold products and services to several key customers, including AMS, Cendant, Equifax, Maricopa County, Merrill Lynch, and the State of Utah. "Our continued improvement throughout the fiscal year leads us to believe that we have substantially improved Versata's competitive position. We now have an obligation to aim higher as we enter the New Year," said Alan Baratz, CEO and president of Versata. "Accordingly, in 2005 our emphasis will shift from lowering costs to growing the top- and bottom-lines through product innovation, new customer acquisition, and even better execution." 2005 Outlook Versata's customer engagements have helped the company develop a product roadmap that is designed to accelerate growth throughout 2005. Among the planned product deliverables is Versata 6, which will leverage Eclipse for its studio environment and integrate support for data, transaction and process logic. Other planned features of Versata 6 include support for Web services and service-oriented architectures, as well as support for rules monitoring and auditing. Another key component of the Versata product roadmap is an enhanced engine for executing business rules using the industry-standard RETE algorithm. This will enable dynamic business rules and provide support for decision logic. Additionally, the company has just introduced a Business Activity Monitoring Dashboard that provides users the means to visually track Versata-powered systems that impact business performance. To accommodate these and other future innovations, Versata has decided to expand its research and development resources in Halifax, Nova Scotia, and end its current relationship with Virtusa. This is, in part, because the Canadian government has several incentive programs that can make this arrangement a very competitive alternative to other offshore options. The Virtusa team is already aiding Versata in facilitating a smooth transition to the Halifax engineering team. The company's other priorities for the coming fiscal year include strengthening the sales and professional services teams to take advantage of new product sales opportunities. Quarterly Conference Call Versata will host its quarterly conference call, open to all interested parties, at 2:00 p.m. (PDT), 5:00 p.m. (EDT), today. The call will be available over the Internet at www.versata.com. Non-GAAP Financial Measures (Regulation G) Versata uses both GAAP and non-GAAP financial measures to report its financial results. Management believes that these non-GAAP financial measures provide an additional tool for investors to evaluate on-going operating results and trends excluding certain items. Versata has historically included non-GAAP financial measures when reporting to the investment community and therefore believes the inclusion of certain non-GAAP financial measures provides consistency and comparability with past financial reports. However, non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. The non-GAAP financial measures used within our earnings press release exclude expenses for: stock-based compensation, amortization of intangibles and restructuring and other. Investors are encouraged to review the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measure as provided in the financial tables attached. About Versata Versata helps automate and simplify the building, maintenance and ongoing evolution of data-intensive applications, business processes and their data. These applications and processes typically access numerous data sources, incorporate multiple database tables and user interfaces, execute business transactions and can support thousands of users. The Versata solution effectively and efficiently replaces time intensive hand-coding efforts with simple, intuitive business rules and graphical process flow specification. Versata Global 2000 customers include Bank of America, B. T., CGI-AMS, Daimler/Chrysler, JP Morgan Chase & Co., Meridian Health Care Management and Union Bank of California. For more information, please visit http://www.versata.com, or call +1 (800) 984-7638 and +1 (510) 628-1000 for international calls. Versata and the Versata logo are registered trademarks of Versata, Inc. in the United States and other countries. This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and are subject to uncertainty and changes in circumstances. Actual results may vary materially from the expectations contained in the forward-looking statements. Forward-looking statements in this release include, statements regarding the Company's expectations, beliefs, hopes, intentions or strategies including without limitation; growing the top- and bottom-lines through product innovation; new customer acquisition; better execution; the Company's ability to deliver its planned products for 2005 and develop the key components of the product roadmap; and Company's expected date and time for announcing the results for the fourth quarter and fiscal year ended October 31, 2004. These statements are not guarantees of future performance and actual results could differ materially from Company's current expectations. Factors that could cause or contribute to such differences include, but are not limited to: inability to grow the top- and bottom-lines; inability to timely deliver the planned product releases or include all of the planned components; unforeseen technical difficulties with the product releases; market acceptance of the Company's value proposition and product initiatives; and date and/or time for the announcement changing due to unforeseen factors and other risks detailed in the Company's Annual Report filed on Form 10-K, registration statement and periodic reports filed with the Securities and Exchange Commission. As a result, actual results may vary, perhaps materially, from those contained in the forward-looking statements. All forward looking statements included in this press release are based upon information available to the Company as of the date hereof, and the Company does not assume any obligation to update such statements or the reasons why actual results could differ materially from those projected in such statements. VERSATA, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND NET LOSS (In thousands, except per share data) Three Months Ended Twelve Months Ended October 31, October 31, 2004 2003 2004 2003 ----------- ----------- ----------- ----------- (Unaudited) (Unaudited) (Unaudited) Revenue: Software license $1,788 $774 $5,853 $5,847 Maintenance and Support 1,454 1,341 5,931 5,820 Professional Services 880 838 3,544 3,595 ----------- ----------- ----------- ----------- Total revenue 4,122 2,953 15,328 15,262 ----------- ----------- ----------- ----------- Cost of revenue: Software license (79) 18 105 218 Maintenance and Support 423 455 1,567 1,635 Professional Services 987 810 3,382 3,364 ----------- ----------- ----------- ----------- Total cost of revenue 1,331 1,283 5,054 5,217 ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- Gross profit 2,791 1,670 10,274 10,045 ----------- ----------- ----------- ----------- Operating expense: Sales and marketing 1,393 1,171 5,714 5,559 Product development 934 1,382 4,051 5,292 General and administrative 535 1,247 3,310 3,429 Stock-based compensation 60 268 372 856 Amortization of intangibles - 500 - 1,973 Restructuring and other 367 1,773 1,583 3,744 ----------- ----------- ----------- ----------- Total operating expense 3,289 6,341 15,030 20,853 ----------- ----------- ----------- ----------- Loss from operations (498) (4,671) (4,756) (10,808) Interest income, net 45 51 156 233 Other non-operating, net (30) (50) (195) (201) ----------- ----------- ----------- ----------- Loss before provision for taxes (483) (4,670) (4,795) (10,776) Provision for taxes - - - - ----------- ----------- ----------- ----------- Net loss $(483) $(4,670) $(4,795) $(10,776) =========== =========== =========== =========== Basic and diluted net loss per share $(0.06) $(0.61) $(0.59) $(1.45) Weighted-average common shares outstanding 8,177 7,679 8,075 7,434 =========== =========== =========== =========== Non-GAAP net loss: Net loss $(483) $(4,670) $(4,795) $(10,776) Add: Stock-based compensation 60 268 372 856 Amortization of intangibles - 500 - 1,973 Restructuring and other 367 1,773 1,583 3,744 ----------- ----------- ----------- ----------- Non-GAAP net loss $(56) $(2,129) $(2,840) $(4,203) =========== =========== =========== =========== Basic and diluted non- GAAP net loss per share $(0.01) $(0.28) $(0.35) $(0.57) VERSATA, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) October 31, October 31, 2004 2003 ----------- ----------- (Unaudited) ASSETS Current assets: Cash and cash equivalents $5,202 $8,089 Short-term investments 4,640 5,693 Accounts receivable, net 1,986 1,917 Prepaid expenses and other 495 411 ----------- ----------- Total current assets 12,323 16,110 ----------- ----------- Restricted cash - 4,781 Property and equipment, net 772 2,098 Intangibles, net - 2 Other assets 112 129 ----------- ----------- Total assets $13,207 $23,120 =========== =========== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $1,188 $346 Accrued liabilities 1,653 2,230 Current portion of accrued restructuring and other 822 1,862 Current portion of deferred revenue 3,553 3,897 ----------- ----------- Total current liabilities 7,216 8,335 ----------- ----------- Accrued restructuring and other, less current portion - 4,005 Deferred revenue, less current portion 588 934 Other long term liabilities 150 - ----------- ----------- Total liabilities 7,954 13,274 ----------- ----------- ----------- ----------- Stockholders' equity 5,253 9,846 ----------- ----------- ----------- ----------- Total liabilities & stockholder's equity $13,207 $23,120 =========== =========== CONTACT: Versata, Inc. Robert Berger, 510-628-1023 Robert_berger@versata.com -----END PRIVACY-ENHANCED MESSAGE-----