EX-99.1 2 a04-11841_1ex99d1.htm EX-99.1

Exhibit 99.1

 

FOR IMMEDIATE RELEASE

 

BroadVision Contact:

Bill Herrick

BroadVision Investor Relations

650.542.3865

ir1@broadvision.com

 

BroadVision, Inc. Announces Third Quarter 2004 Results

 

Company Settles Significant Long-Term Lease Obligations and Records a $25.7 Million Restructuring Credit

 

REDWOOD CITY, CALIF. —  October 20, 2004 — BroadVision, Inc. (Nasdaq: BVSN), a global provider of self-service web applications, today reported financial results for its third quarter ended September 30, 2004. Revenues for the third quarter of 2004 were $17.2 million, compared with revenues of $20.1 million for the second quarter ended June 30, 2004 and $18.6 million for the third quarter of 2003. License revenue for the quarter totaled $4.7 million versus $7.1 million in the second quarter of 2004 and $5.1 million in the comparable quarter of 2003.

In the third quarter of 2004, BroadVision posted net income on a generally accepted accounting principles (GAAP) basis of $23.7 million, or $0.69 per diluted share, which included a restructuring credit of $25.7 million attributable to the settlement and elimination of certain long-term lease obligations. The GAAP net income for the quarter compares with a GAAP net loss of $1.5 million, or $0.04 per diluted share, for the second quarter of 2004, and a GAAP net loss of $10.3 million, or $0.31 per diluted share, in the third quarter of 2003.

Pro forma net loss for the third quarter of 2004 was $2.1 million, or $0.06 per diluted share, compared with a pro forma net loss of $813,000, or $0.02 per diluted share, in the second quarter of 2004 and a pro forma net loss of $5.5 million, or $0.17 per diluted share, in the third quarter of 2003. Pro forma results exclude a restructuring credit of $25.7 million in the third quarter of 2004, and restructuring charges of $679,000 in the second quarter of 2004 and $4.5 million in the third quarter of 2003. A reconciliation of pro forma results to GAAP results is provided in the financial information attached to this press release. Management believes the pro forma results provide useful information because they reflect BroadVision’s

 

 


 

financial performance excluding certain charges and restructuring expenses that management believes are not indicative of its ongoing operations.

During the third quarter of 2004, BroadVision closed 26 license transactions including four licenses of its new product, BroadVision® Process™. BroadVision Process enables organizations to transform offline, people-intensive processes and collaborations into web-based self-service processes and deploy them into existing websites.

“Our third quarter revenue, within the range of preliminary expectations announced in early October, is indicative of a sales environment that is difficult and seasonally soft in the third quarter — particularly in Europe,” said Dr. Pehong Chen, BroadVision president and CEO. “Certain transactions that we expected to close in Q3 did not close, largely due to the impact of a North American sales force reorganization and customer delays due to increased controls over purchasing approval processes.  We are optimistic that we will close certain delayed transactions in the fourth quarter, and hence we believe we have improved near-term visibility. We were able to increase the number of BroadVision Process transactions, and we continue to build our pipeline for this important, new product.

“Also in recent weeks, we have terminated excess real estate lease obligations related to four facilities, comprising over 85% of our outstanding commitments and over $3 million of quarterly cash,” continued Dr. Chen.  “We believe the settlements for less than 30 cents on the dollar are favorable for the Company and remove significant impediments to our growth and cash flow goals for 2005.”

During the third quarter of 2004, BroadVision closed new and repeat business in all key vertical markets with companies such as Air Miles Travel Company, Epic Link Spa, General Systems, Iberia, Lord Abbett & Co., and Pitney Bowes.

 

Conference Call

BroadVision will hold a conference call to discuss this press release and related matters at 5:00 pm Eastern Time, October 20, 2004. The call, hosted by Dr. Pehong Chen, can be accessed live by dialing 1-800-435-1261; pass code 75621572 or live and thereafter by visiting the investor relations section of the Company’s website at www.broadvision.com/ir.

 

 

 


 

Information Concerning Forward-Looking Statements

 

Information in this release that involves expectations, beliefs, hopes, plans, intentions or strategies regarding the future are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, which forward-looking statements involve risk and uncertainties. All forward-looking statements included in this release, including, but not limited to, our ability to finalize revenue transactions in future quarters and our ability to generate growth and positive cash flows in 2005, are based upon information available to BroadVision as of the date of this release, and BroadVision assumes no obligation to update or correct any such forward-looking statements. These statements are not guarantees of future performance and actual results could differ materially from BroadVision’s current expectations. Factors which could cause or contribute to such differences include, but are not limited to: lack of market acceptance of BroadVision’s existing and new products or services; BroadVision’s inability to continue to develop competitive new products and services on a timely basis; introduction of new products or services by competitors; general economic conditions and BroadVision’s inability to attract and retain qualified employees. These and other factors and risks associated with BroadVision’s business are discussed in its most recent annual report on Form 10-K and in BroadVision’s quarterly reports on Form 10-Q as filed with the Securities and Exchange Commission.

 

About BroadVision

BroadVision (Nasdaq: BVSN) is a global provider of personalized self-service web applications. Our integrated suite of process, commerce, portal, and content solutions helps customers rapidly increase revenues and reduce costs. Over 1,000 organizations - including Circuit City, Vodafone, Cardinal Health, Hewlett-Packard, Toyota, Japan Airlines and the U.S. Air Force - serving nearly 60 million registered users, rely on BroadVision’s open solutions to power and personalize their mission-critical web initiatives

 

For more information about BroadVision, Inc., call 650.542.5100, email info@broadvision.com or visit www.broadvision.com.

 

#   #   #

BroadVision and BroadVision Process are trademarks or registered trademarks of BroadVision, Inc. in the United States and other countries.

 

 

 


 

BROADVISION, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except per share amounts)

 

 

 

Sep. 30

 

Dec. 31

 

 

 

2004

 

2003

 

ASSETS

 

(Unaudited)

 

 

 

Current assets:

 

 

 

 

 

Cash and cash equivalents

 

$

28,144

 

$

78,776

 

Accounts receivable, less allowance for doubtful accounts and reserves of $1,295 and $3,022 as of September 30, 2004 and December 31, 2003, respectively

 

12,100

 

15,380

 

Restricted cash and investments, current portion

 

19,163

 

—

 

Prepaids and other

 

4,098

 

5,346

 

Total current assets

 

63,505

 

99,502

 

 

 

 

 

 

 

Property and equipment, net

 

4,383

 

15,400

 

Restricted cash and investments, net of current portion

 

1,797

 

19,827

 

Equity investments

 

574

 

1,565

 

Goodwill

 

53,421

 

53,421

 

Other intangibles, net

 

3,013

 

3,013

 

Other assets

 

1,753

 

2,354

 

Total assets

 

$

128,446

 

$

195,082

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

Bank borrowings and current portion of long-term debt

 

$

15,774

 

$

27,977

 

Accounts payable

 

6,730

 

9,186

 

Accrued expenses

 

38,346

 

34,761

 

Unearned revenue

 

4,297

 

7,596

 

Deferred maintenance

 

16,429

 

19,234

 

Total current liabilities

 

81,576

 

98,754

 

Long-term debt, net of current portion

 

503

 

969

 

Other noncurrent liabilities

 

14,100

 

87,409

 

Total liabilities

 

96,179

 

187,132

 

Commitments and contingencies

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

Common stock

 

3

 

3

 

Additional paid-in capital

 

1,215,646

 

1,212,671

 

Accumulated other comprehensive loss

 

—

 

(49

)

Accumulated deficit

 

(1,183,382

)

(1,204,675

)

Total stockholders’ equity

 

32,267

 

7,950

 

Total liabilities and stockholders’ equity

 

$

128,446

 

$

195,082

 

 

 

 


 

BROADVISION, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share amounts)

(Unaudited)

 

 

 

 

Three Months Ended

 

 

 

Sep. 30,

 

Jun. 30,

 

Sep 30,

 

 

 

2004

 

2004

 

2003

 

Revenues:

 

 

 

 

 

 

 

Software licenses

 

$

4,654

 

$

7,097

 

$

5,076

 

Services

 

12,570

 

13,031

 

13,493

 

Total revenues

 

17,224

 

20,128

 

18,569

 

Cost of revenues:

 

 

 

 

 

 

 

Cost of software licenses

 

256

 

313

 

666

 

Cost of services

 

6,391

 

6,302

 

5,915

 

 

 

 

 

 

 

 

 

Total cost of revenues

 

6,647

 

6,615

 

6,581

 

 

 

 

 

 

 

 

 

Gross profit

 

10,577

 

13,513

 

11,988

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

Research and development

 

4,600

 

4,509

 

4,467

 

Sales and marketing

 

6,020

 

7,480

 

6,710

 

General and administrative

 

2,335

 

2,400

 

2,885

 

Litigation settlement costs

 

—

 

—

 

4,250

 

Restructuring (credit) charge

 

(25,726

)

679

 

4,509

 

 

 

 

 

 

 

 

 

Total operating (credit) expenses

 

(12,771

)

15,068

 

22,821

 

 

 

 

 

 

 

 

 

Operating income (loss)

 

23,348

 

(1,555

)

(10,833

)

 

 

 

 

 

 

 

 

Interest income, net

 

77

 

102

 

81

 

Other income (expense) , net

 

238

 

(45

)

574

 

 

 

 

 

 

 

 

 

Income (loss) before (provision)/benefit for income taxes

 

23,663

 

(1,498

)

(10,178

)

(Provision)/benefit for income taxes

 

(11

)

6

 

(87

)

 

 

 

 

 

 

 

 

Net income (loss)

 

$

23,652

 

$

(1,492

)

$

(10,265

)

 

 

 

 

 

 

 

 

Basic income (loss) per share

 

$

0.70

 

$

(0.04

)

$

(0.31

)

 

 

 

 

 

 

 

 

Diluted income (loss) per share

 

$

0.69

 

$

(0.04

)

$

(0.31

)

 

 

 

 

 

 

 

 

Shares used in computing basic income (loss) per share

 

33,599

 

33,476

 

32,906

 

 

 

 

 

 

 

 

 

Shares used in computing diluted income (loss) per share

 

34,052

 

33,476

 

32,906

 

 

 

 

 

 

 

 

 

PRO FORMA FINANCIAL INFORMATION(1):

 

 

 

 

 

 

 

Net loss

 

$

(2,074

)

$

(813

)

$

(5,458

)

Basic loss per share

 

$

(0.06

)

$

(0.02

)

$

(0.17

)

Diluted loss per share

 

$

(0.06

)

$

(0.02

)

$

(0.17

)

 

 

 

 

 

 

 

 

 

 


 

(1) Pro forma net loss and the related per share amounts exclude restructuring charges, impairment of equity investments and impairment of assets.  Pro forma net loss and pro forma cost of revenues and operating expenses reconcile to the comparable amounts under generally accepted accounting principles as follows (unaudited, in thousands):

 

 

 

Three Months Ended

 

 

 

Sep. 30,

 

Jun. 30,

 

Sep. 30,

 

 

 

2004

 

2004

 

2003

 

Net income (loss), generally accepted accounting principles

 

$

23,652

 

$

(1,492

)

$

(10,265

)

Pro forma adjustments:

 

 

 

 

 

 

 

Restructuring charges (credits)

 

(25,726

)

679

 

4,509

 

Impairment of equity investment

 

—

 

—

 

298

 

 

 

 

 

 

 

 

 

Pro forma net loss

 

$

(2,074

)

$

(813

)

$

(5,458

)

 

 

 

 

 

 

 

 

Cost of revenues and operating expenses, generally accepted accounting principles

 

$

(6,124

)

$

21,683

 

$

29,402

 

Pro forma adjustments:

 

 

 

 

 

 

 

Restructuring charges

 

25,726

 

(679

)

(4,509

)

Pro forma cost of revenues and operating expenses

 

$

19,602

 

$

21,004

 

$

24,893