-----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, I7xKnWun54rI5PGWIVftkD2K5zviUZf3q8/6x/to/SWxM+vgCfZfwE+IV4iOeu33 aVDNjDdhmUnE+mUIJZo3Sw== 0000950123-05-010318.txt : 20050824 0000950123-05-010318.hdr.sgml : 20050824 20050824170757 ACCESSION NUMBER: 0000950123-05-010318 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20050824 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20050824 DATE AS OF CHANGE: 20050824 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CONVERA CORP CENTRAL INDEX KEY: 0001125536 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-PREPACKAGED SOFTWARE [7372] IRS NUMBER: 541987541 STATE OF INCORPORATION: DE FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-31989 FILM NUMBER: 051046609 BUSINESS ADDRESS: STREET 1: 1921 GALLOWS ROAD SUITE 200 CITY: VIENNA STATE: VA ZIP: 22182 BUSINESS PHONE: 7037615254 MAIL ADDRESS: STREET 1: 1921 GALLOWS ROAD STREET 2: SUITE 200 CITY: VIENNA STATE: VA ZIP: 22182 FORMER COMPANY: FORMER CONFORMED NAME: EXCA HOLDINGS INC DATE OF NAME CHANGE: 20001002 8-K 1 y12180e8vk.txt FORM 8-K UNITED STATES 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 AUGUST 24, 2005 DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED) CONVERA CORPORATION - -------------------------------------------------------------------------------- (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) DELAWARE 000-31989 54-1987541 (STATE OR OTHER (COMMISSION FILE NO.) (I.R.S. EMPLOYER JURISDICTION OF INCORPORATION) IDENTIFICATION NO.) 1921 GALLOWS ROAD, SUITE 200 VIENNA, VIRGINIA 22182 - -------------------------------------------------------------------------------- (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES AND ZIP CODE) REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (703) 761-3700 Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): _____ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) _____ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) _____ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) _____ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Item 2.02. Results Of Operations And Financial Condition Attached and incorporated herein by reference as Exhibit 99.1 is a copy of a press release of Convera Corporation (the "Company"), dated August 24, 2005, reporting the Company's financial results for the fiscal quarter ended July 31, 2005. Such information, including the Exhibit attached hereto, shall not be deemed "filed" for purposes of Section 18 of the Securities Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing. Item 9.01(c). Financial Statements and Exhibits 99.1 Press Release of Convera Corporation dated August 24, 2005, reporting Convera Corporation's financial results for the fiscal quarter ended July 31, 2005. 2 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, thereto duly authorized. CONVERA CORPORATION By: /s/ JOHN R. POLCHIN ---------------------- John R. Polchin Chief Financial Officer Date: August 24, 2005 3 EX-99.1 2 y12180exv99w1.txt PRESS RELEASE Exhibit 99.1 [CONVERA LOGO] Contact: John R. Polchin Chief Financial Officer Convera 703.761.3700 Convera Reports Second Quarter Financial Results Revenue Up 54% Driven By Federal Group Vienna, Va., August 24, 2005 - Convera Corporation (NASDAQ: CNVR), a leading provider of search and categorization software for enterprises and government agencies, today announced financial results for the three-month period ended July 31, 2005. Revenue for the second quarter of fiscal 2006 totaled $7.8 million, a 54% increase when compared to the year-ago quarter. The Company's federal business segment drove the increased top-line performance as two transactions each exceeded 10% of total reported revenue for the period. Gross profit for the three-month period ended July 31, 2005 totaled $6.7 million, resulting in a gross margin of 86% as compared to a gross margin of 66% for the prior-year period. The net loss for the three-month period ended July 31, 2005 was approximately $25,000 or less than $0.01 per share, compared to a net loss of $7.0 million, or $0.21 per share, for the comparable year-ago quarter. During the second quarter approximately $2.4 million of research and development costs related to the Company's Web indexing initiative (e.g., Excalibur) were capitalized per FAS 86. The Company adopted FAS 86, as discussed further below, during the first quarter of fiscal 2006. Cash and investments as of July 31, 2005 totaled $45.0 million, inclusive of $28.8 million of net proceeds realized from the July 2005 Private Placement as previously announced. "Our second quarter results clearly demonstrate the value of the expense and strategic actions we effected nearly a year ago", stated Patrick C. Condo, Convera's President and Chief Executive Officer. "Our software products group (e.g., RetrievalWare) produced strong top-line growth led by our continuing commitment to the federal sector. Additionally, we advanced our Web index to two billion pages and our balance sheet was significantly improved through a private placement with marquee investors. We now look forward to the launch of Excalibur later this year, while also maintaining net income neutrality for our software products group", Condo concluded. With respect to Excalibur, the Company's emerging Web indexing initiative (which focuses on applying portions of the Company's existing technology to searching and indexing contextually relevant information from the World Wide Web), the Company continues to realize advances in its development efforts, including increases to its Web index that currently exceeds two billion pages. The Company is currently accepting "beta" customers and the Company remains focused on launching a service offering later this fiscal year. Capital outlays to date, in connection with the Web indexing initiative, remain limited to equipment, personnel and general operating costs, which are expected to increase as the indexing initiative progresses. The Company will continue to assess future capital requirements for this Web indexing initiative and may elect to seek additional funding sources over the coming quarters. -- more -- Page 2 - Convera Reports Second Quarter Financial Results - --------------------------------------------------------- FAS 86 - ------ FAS 86 governs the practice by which newly developed technology (e.g., software in this case), is accounted for once "technological feasibility" has been determined. Convera's Web indexing initiative (e.g., Excalibur) was determined to have reached technological feasibility during the first quarter of fiscal 2006 with the attainment of a one billion page Web index. Once technological feasibility was achieved, the Company began capitalizing software development costs and will continue to do so until such time, as "commercial availability" is determined. At the time of commercial availability, capitalization of the Web indexing related research and development costs will cease and amortization of the capitalized costs will commence over a yet to be determined timeframe. The attached financial information compares the results of operations for the three-month period ended July 31, 2005 to the same period in 2004 and the balance sheet as of July 31, 2005 to the balance sheet as of January 31, 2005. About Convera Convera is a leading provider of mission-critical enterprise search and categorization solutions. Convera's RetrievalWare solutions maximize return on investment in vast stores of unstructured information by providing highly scalable, fast, accurate and secure search across more than 200 forms of text, video, image and audio information, in more than 50 languages. More than 900 customers in 33 countries rely on Convera's search solutions to power a broad range of applications including enterprise portals, knowledge management, intelligence gathering, profiling, corporate policy compliance, regulatory compliance, customer service and more. For more information, contact Convera at 800-788-7758, via e-mail at info@convera.com or on the Web at www.convera.com This release, including any statements from Convera personnel, contains statements about Convera's future expectations, performance, plans, and prospects, as well as assumptions about future events. The reader is cautioned not to put undue reliance on these forward-looking statements, as these statements are subject to numerous factors and uncertainties, including without limitation, business and economic conditions and trends; continued success in technological advances and development including the Web initiative (e.g., Excalibur); possible disruption in commercial activities caused by terrorist activity and armed conflict, such as changes in logistics and security arrangements; reduced customer demand relative to expectations; competitive factors; and other risk factors listed from time to time in the company's SEC reports. Actual results may differ materially from our expectations as the result of these and other important factors relating to Convera's business and product development efforts, which are further described in Convera's filings with the Securities and Exchange Commission. These filings can be obtained from the SEC's website located at www.sec.gov. Any forward-looking statements are based on information available to Convera on the date of this release, and Convera assumes no obligation to update such statements. The Convera design logo and the following are worldwide trademarks of Convera: Convera(tm), RetrievalWare(r), and Screening Room(r). The names of actual companies and products mentioned herein may be the trademarks of their respective owners. -- more -- Page 3 - Convera Reports Second Quarter Financial Results - --------------------------------------------------------- The condensed, consolidated statements of operations for the Company appear below and are presented in accordance with accounting principles generally accepted in the United States. All amounts, except per share amounts, are expressed in thousands of U.S. dollars. Three Months Ended Six Months Ended July 31, July 31, 2005 2004 2005 2004 ---- ---- ---- ---- (unaudited) (unaudited) (unaudited) (unaudited) Revenues: License $ 5,230 $ 2,197 $ 7,417 $ 8,053 Services 590 1,041 1,431 1,624 Maintenance 1,984 1,829 4,035 3,560 ------------------------ ---------------------- Total revenues 7,804 5,067 12,882 13,237 ------------------------ ---------------------- Cost of Revenues: License (23) 468 407 1,127 Services 809 802 1,637 1,517 Maintenance 293 436 515 958 ------------------------ ---------------------- Total cost of revenues 1,079 1,706 2,558 3,602 ------------------------ ---------------------- Gross Margin 6,725 3,361 10,324 9,635 ------------------------ ---------------------- Operating Expenses: Sales and marketing 2,360 4,302 4,556 9,316 Research and product development, gross 3,788 3,632 7,728 7,272 Capitalized research and development costs (2,367) - (4,654) - General and administrative 3,045 2,506 5,345 4,922 Restructuring - - (56) - ------------------------ ---------------------- Total operating expenses 6,825 10,440 12,919 21,511 ------------------------ ---------------------- Operating Loss (100) (7,079) (2,594) (11,876) Other Income, net 74 30 100 68 ------------------------ ---------------------- Net Loss $ (25) $ (7,049) $(2,494) $(11,808) ======================== ====================== Net loss per common share - - basic & diluted $ (0.00) $ (0.21) $ (0.06) $ (0.35) ======================== ====================== Weighted-average number of common shares outstanding - - basic & diluted 40,803 34,040 39,597 33,989 -- more -- Page 4 - Convera Reports Second Quarter Financial Results - --------------------------------------------------------- The condensed, consolidated balance sheets for the Company appear below and are presented in accordance with accounting principles generally accepted in the United States. All amounts are expressed in thousands of U.S. dollars. ASSETS July 31, 2005 January 31, 2005 ------------- ---------------- (unaudited) Current Assets Cash and cash equivalents $ 44,889 $ 17,766 Short term investments 71 71 Accounts receivable, net 10,093 6,530 Prepaid expenses and other 1,938 2,390 ---------------------------- Total current assets 56,991 26,757 Other assets, net 5,314 6,696 Goodwill & Other intangible assets 2,706 2,841 Capitalized research and development costs 4,678 - --------------------------- Total Assets $ 69,689 $ 36,294 LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities Accounts payable $ 1,703 $ 1,967 Accrued expenses 3,693 4,055 Deferred revenues 3,528 4,288 Restructuring reserve - current 13 835 --------------------------- Total current liabilities 8,937 11,145 Other long-term liabilities 5,000 - --------------------------- Total long-term liabilities 5,000 - --------------------------- Total Liabilities 13,937 11,145 Shareholders' Equity 55,752 25,149 Total Liabilities & Shareholders' Equity $ 69,689 $ 36,294 ### -----END PRIVACY-ENHANCED MESSAGE-----