Exhibit 99.1
FOR IMMEDIATE RELEASE
SPESCOM SOFTWARE ANNOUNCES FIRST QUARTER RESULTS
SAN DIEGO, CA, February 15, 2005— Spescom Software Inc. (OTCBB: SPCO), a leading provider of enterprise content and configuration management solutions, today reported results of operations for its fiscal first quarter ended December 31, 2004.
Total revenue for the first quarter of 2005 was $1.7 million, a decrease of 19% versus revenue of $2.1 million in the year earlier quarter. Net loss before deemed and cumulative dividends for the first quarter of 2005 was ($604,000), or ($0.02) per share, compared with net income before deemed and cumulative dividends of $11,000, or $0.00 per share, for the three months ended December 31, 2003. After the effect of the deemed dividend and cumulative dividends totalling $2,274,000 to preferred shareholders in the first quarter of 2005, the net loss available to common shareholders was ($2,878,000) or ($0.08) per share. In the prior year the net loss available to common shareholders in the first quarter was ($55,000) or ($0.00) per share.
“The results of the first quarter reflect the unpredictability of our revenues in which the successful conclusion or lack thereof of only one or two additional contracts per quarter, has a significant impact on our revenues. We are continuing to pursue some major opportunities. We believe our pipeline of potential sales opportunities remains strong, providing a source for potential future growth,” commented Carl Mostert, CEO, Spescom Software.
“In our first quarter the Company was able to successfully close a private placement for $2.2 million. The funding has enabled us to accelerate our marketing and sales efforts while also providing liquidity to the Company” added Carl Mostert.
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About Spescom Software Inc.
Spescom Software (OTC BB: SPCO) delivers enterprise eBusiness solutions that provide rapid access to accurate information in context to assets, products and processes, resulting in improved customer satisfaction, productivity and safety. It achieves this through a tightly integrated suite of document, configuration and records management technologies that not only allows it to capture and securely store information, but also organizes and structures this information to place it in context.
Key customers include Constellation Energy, Continental Express, AmerenUE, Cities of Las Vegas and Dayton, Lloyds Register of Shipping, United Space Alliance, Entergy, Northeast Utilities, London Underground, Network Rail, and many others.
Except for historical information contained herein, the matters set forth in this release include forward-looking statements that are dependent on certain risks and uncertainties, including such factors, among others, as market acceptance, market demand, pricing, changing regulatory environment, the effect of the company’s accounting policies, potential seasonality and other risk factors detailed in the Company’s SEC filings.
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SPESCOM SOFTWARE INC.
Consolidated Statements of Operations
| | For the three months
ended December 31, | | |
| | | |
| | 2004 | | 2003 | | |
Revenues: | | | | | | |
Licenses | | $ | 268,000 | | $ | 1,119,000 | | |
Services and other | | 1,385,000 | | 1,006,000 | | |
Total revenues | | 1,653,000 | | 2,125,000 | | |
| | | | | | |
Cost of revenues: | | | | | | |
Licenses | | 44,000 | | 101,000 | | |
Services and other | | 614,000 | | 553,000 | | |
Total cost of revenues | | 658,000 | | 654,000 | | |
| | | | | | |
Gross profit | | 995,000 | | 1,471,000 | | |
| | | | | | |
Operating expenses: | | | | | | |
Research and development | | 346,000 | | 334,000 | | |
Marketing and sales | | 824,000 | | 605,000 | | |
General and administrative | | 399,000 | | 503,000 | | |
| | 1,569,000 | | 1,442,000 | | |
| | | | | | |
Income (loss) from operations | | (574,000 | ) | 29,000 | | |
| | | | | | |
Interest and other expense | | (30,000 | ) | (23,000 | ) | |
Gain on derivative valuation | | — | | 5,000 | | |
Net income (loss) | | (604,000 | ) | 11,000 | | |
| | | | | | |
Deemed preferred dividend | | (2,200,000 | ) | — | | |
Net income (loss) after deemed preferred dividend | | (2,804,000 | ) | 11,000 | | |
| | | | | | |
Cumulative preferred dividends | | (74,000 | ) | (66,000 | ) | |
| | | | | | |
Net income (loss) available to common shareholders | | $ | (2,878,000 | ) | $ | (55,000 | ) |
| | | | | | |
Basic and diluted net income (loss) per common share | | $ | (0.08 | ) | $ | (0.00 | ) |
| | | | | | |
Shares used in computing basic and diluted net income (loss) per common share | | 34,159,000 | | 33,929,000 | | |
| | | | | | | | | | | | | |
SPESCOM SOFTWARE INC.
Consolidated Balance Sheets
| | December 31, | | September 30, | |
| | 2004 | | 2004 | |
| | (Unaudited) | | | |
ASSETS | | | | | |
Current assets: | | | | | |
Cash and cash equivalents | | $ | 812,000 | | $ | 109,000 | |
Receivables, net | | 855,000 | | 954,000 | |
Other current assets | | 179,000 | | 209,000 | |
Total current assets | | 1,846,000 | | 1,272,000 | |
| | | | | |
Property and equipment, net | | 98,000 | | 116,000 | |
Computer software, net | | 40,000 | | 15,000 | |
Other assets | | 27,000 | | 27,000 | |
Total assets | | $ | 2,011,000 | | $ | 1,430,000 | |
| | | | | |
LIABILITIES AND SHAREHOLDERS’ DEFICIT | | | | | |
| | | | | |
Current liabilities: | | | | | |
Accounts payable | | $ | 415,000 | | $ | 440,000 | |
Payable to Spescom Ltd. | | 53,000 | | 90,000 | |
Preferred stock dividend payable to Spescom Ltd. | | 348,000 | | 271,000 | |
Accrued liabilities | | 997,000 | | 1,226,000 | |
Notes and accrued interest Payable to Spescom Ltd. | | 574,000 | | — | |
Lease obligation — current portion | | 17,000 | | 19,000 | |
Deferred revenue | | 1,616,000 | | 1,919,000 | |
Total current liabilities | | 4,020,000 | | 3,965,000 | |
| | | | | |
Notes payable and accrued interest to Spescom Ltd. | | — | | 557,000 | |
Lease obligation | | 40,000 | | 44,000 | |
Total liabilities | | 4,060,000 | | 4,566,000 | |
| | | | | |
Total shareholders’ deficit | | (2,049,000 | ) | (3,136,000 | ) |
| | | | | |
Total liabilities and shareholders’ deficit | | $ | 2,011,000 | | $ | 1,430,000 | |
| | | | | | | | |
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