Exhibit 99.1
| | Unify Corporation 2101 Arena Blvd. Sacramento, CA 95834 916-928-6400 www.unify.com |
Unify Reports Third Quarter 2005 Results
Quarter over Quarter Software License Revenues Increased 24 Percent
SACRAMENTO, Calif., — Feb. 22, 2005 — Unify Corporation (OTC BB: UNFY) today announced financial results for the third quarter of fiscal 2005 ended Jan. 31, 2005.
Total revenues in the third quarter were $3.0 million, a 13 percent increase, compared to total revenues of $2.6 million for the third quarter of fiscal 2004. Third quarter software license revenues increased 24 percent to $1.5 million, compared to $1.2 million in the same period last year. Services revenues increased four percent to $1.5 million for the quarter, compared to $1.5 million in the third quarter last year.
GAAP net loss for the third quarter was $651,000, or $0.02 loss per share, compared to third quarter fiscal 2004 net loss of $470,000, or $0.02 loss per share. Gross margin for the quarter was 85 percent, compare to 80 percent in the same period last year. Third quarter non-GAAP net income was $29,000, compared to a non-GAAP net loss of $462,000 in the third quarter of fiscal 2004. Non-GAAP net income excludes severance and restructuring charges, acquisition related expenses and special charges (recoveries).
Reconciliation of GAAP Net Loss to Non-GAAP Net Income (Loss): | |
| |
| | Quarter Ended
Jan 31, 2005 | | Quarter Ended
Jan 31, 2004 | | Nine Months ended
Jan 31, 2005 | | Nine Months ended
Jan 31, 2004 | |
| | | | | | | | | |
GAAP Net Income (Loss) | | $ | (651,000 | ) | $ | (470,000 | ) | $ | (1,759,000 | ) | $ | (553,000 | ) |
| | | | | | | | | |
Adjustments : | | | | | | | | | |
Severance & Restructuring Charges | | 700,000 | | | | 700,000 | | 200,000 | |
Acquisition related expenses | | 130,000 | | | | 130,000 | | | |
Write-down of Other Investments | | | | | | | | 175,000 | |
Special Charges (Recoveries) (1) | | (150,000 | ) | 8,000 | | (150,000 | ) | 110,000 | |
| | | | | | | | | |
Non-GAAP Net Income (Loss) | | $ | 29,000 | | $ | (462,000 | ) | $ | (1,079,000 | ) | $ | (68,000 | ) |
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(1) Special charges (recoveries) related primarily to litigation expenses
“We had a good execution this quarter including the expansion of our strategy into specialty vertical markets,” said Todd Wille, CEO of Unify. “We had renewed investments in our technology from some long-time customers, reorganized our European operations and planned for the acquisition of Acuitrek. We are confident and excited about our prospects in the coming year.”
The Company had $3.9 million in cash and cash equivalents at Jan. 31, 2005, up from $2.8 million at January 31, 2004, but down from $6.6 million as of April 30, 2004. Stockholders’ equity at January 31, 2005 was $2.9 million, compared to $1.3 million at January 31, 2004, and compared to $4.5 million at April 30, 2004.
For the nine months ended January 31, 2005, total revenues were $8.5 million, a two percent decrease, compared to $8.7 million for the same nine-month period last year. GAAP net loss for the first nine months was $1.8 million or $0.06 loss per share, compared to a GAAP net loss of $553,000 or $0.03 loss per share for the first nine months of last year. On a Non-GAAP basis, net loss for the first nine months was $1.1 million, compared to a Non-GAAP net loss of $68,000 for same nine-month period last year.
During the third quarter, Unify:
· Executed on its expanded strategy to target specialty vertical markets with its business process automation technology.
· Centralized its European sales and support operations into a European headquarters in Paris.
· Announced the creation of Unify Business Solutions focused on building and sustaining active partnerships with independent software vendors (ISVs) resellers (VARs) and global distributors.
· Earned business from several long-standing customers including Business Console, CNA Insurance Group, Credit Lyonnaise Group Management, Glaxo, Pan Systems, SE Software Engineering, GE Healthcare, and Vision Data Equipment Corp.
Conference Call
Unify will hold its quarterly conference call, open to all interested parties, on Feb. 22, 2005, beginning at 2 p.m. Pacific Time. Listeners should dial 800-370-0740 prior to the start of the conference call. The conference call will also be Webcast. Online listeners should visit www.unify.com/investors prior to the start of the call for login information. A replay of the conference call will be available until March 4, 2005 by dialing 877-519-4471 and entering the passcode 5674828.
About Unify
Unify (OTCBB: UNFY) provides business process automation solutions, including market leading applications for specialty markets within the insurance, retail and transportation industries. Unify’s solutions deliver a broad set of capabilities for
automating business processes, integrating existing information systems and delivering collaborative information. Through its industry expertise and market leading technologies, Unify helps organizations drive business optimization, apply governance and increase customer service. For more than 25 years, Unify has served more than 2,000 agencies, corporations and independent software vendors. Unify is headquartered in Sacramento, Calif. with offices in London and Paris, and a worldwide network of global distributors. Contact Unify at 916-928-6400 or visit www.unify.com.
This press release contains “forward-looking statements” as that term is defined in Section 21E of the Securities Exchange Act of 1934 as amended. Forward looking statements are denoted by words such as “anticipates”, “expects”, “intends”, “plans”, “believes”, “seeks”, “estimates”, and other variations of such words and similar expressions are intended to identify such forward-looking statements. These forward looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied by our forward looking statements. Such risks and uncertainties include, but are not limited to general economic conditions in the computer and software industries, domestically and worldwide, the Company’s ability to keep up with technological innovations in relation to its competitors, product defects or delays, developments in the Company’s relationships with its customers, distributors and suppliers, changes in pricing policies of the Company or its competitors and the Company’s ability to attract and retain employees in key positions. In addition, Unify’s forward looking statements should be considered in the context of other risks and uncertainties discussed in our SEC filings available for viewing on its web site at “Investor Relations,” “SEC filings” or from the SEC at www.sec.gov.
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UNIFY CORPORATION
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
| | January 31, 2005 | | April 30, 2004 | |
| | | | | |
Assets | | | | | |
Current assets: | | | | | |
Cash and cash equivalents | | $ | 3,915 | | $ | 6,606 | |
Accounts receivable, net | | 3,259 | | 2,848 | |
Prepaid expense & other current assets | | 691 | | 543 | |
Total current assets | | 7,865 | | 9,997 | |
| | | | | |
Property and equipment, net | | 385 | | 338 | |
Other investments | | 214 | | 214 | |
Other assets | | 177 | | 194 | |
Total assets | | $ | 8,641 | | $ | 10,743 | |
| | | | | |
Liabilities and Stockholders’ Equity | | | | | |
Current liabilities: | | | | | |
Current portion of long term debt | | $ | 161 | | $ | 146 | |
Account payable | | 341 | | 523 | |
Other accrued liabilities | | 1,148 | | 1,340 | |
Accrued compensation and related expenses | | 736 | | 812 | |
Deferred revenue | | 3,301 | | 3,360 | |
Total current liabilities | | 5,687 | | 6,181 | |
| | | | | |
Other long term liabilities | | 79 | | 70 | |
| | | | | |
Long term debt | | 12 | | — | |
| | | | | |
Commitments and contingencies | | | | | |
| | | | | |
Stockholders’ equity: | | | | | |
Common stock | | 28 | | 27 | |
Additional paid in capital | | 63,275 | | 63,205 | |
Accumulated other comprehensive loss | | 77 | | 18 | |
| | | | | |
Accumulated deficit | | (60,517 | ) | (58,758 | ) |
Total stockholders’ equity | | 2,863 | | 4,492 | |
Total liabilities and stockholders’ equity | | $ | 8,641 | | $ | 10,743 | |
UNIFY CORPORATION
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
| | Three Months Ended January31, | | Nine Months Ended January 31, | |
| | 2005 | | 2004 | | 2005 | | 2004 | |
| | | | | | | | | |
Revenues: | | | | | | | | | |
Software Licenses | | $ | 1,469 | | $ | 1,185 | | $ | 3,934 | | $ | 4,427 | |
Services | | 1,518 | | 1,459 | | 4,596 | | 4,322 | |
Total revenues | | 2,987 | | 2,644 | | 8,530 | | 8,749 | |
| | | | | | | | | |
Cost of Revenues: | | | | | | | | | |
Software licenses | | 96 | | 226 | | 264 | | 413 | |
Services | | 351 | | 302 | | 1,077 | | 950 | |
Total cost of revenues | | 447 | | 528 | | 1,341 | | 1,363 | |
| | | | | | | | | |
Gross profit | | 2,540 | | 2,116 | | 7,189 | | 7,386 | |
| | | | | | | | | |
Operating Expenses: | | | | | | | | | |
Product development | | 678 | | 618 | | 2,110 | | 2,297 | |
Selling, general and administrative | | 2,544 | | 1,968 | | 6,866 | | 5,454 | |
Write-down of other investments | | — | | — | | — | | 175 | |
Total operating expenses | | 3,222 | | 2,305 | | 8,976 | | 7,926 | |
| | | | | | | | | |
Income (loss) from operations | | (682 | ) | (470 | ) | (1,787 | ) | (540 | ) |
Other income (expense), net | | 34 | | (4 | ) | 35 | | (7 | ) |
| | | | | | | | | |
Income (loss) before income taxes | | (648 | ) | (474 | ) | (1,752 | ) | (547 | ) |
Provision (recovery) for income taxes | | 3 | | (4 | ) | 7 | | 6 | |
| | | | | | | | | |
Net income (loss) | | $ | (651 | ) | $ | (470 | ) | $ | (1,759 | ) | $ | (553 | ) |
| | | | | | | | | |
Net income (loss) per share: | | | | | | | | | |
Basic | | $ | (0.02 | ) | $ | (0.02 | ) | $ | (0.06 | ) | $ | (0.03 | ) |
Dilutive | | $ | (0.02 | ) | $ | (0.02 | ) | $ | (0.06 | ) | $ | (0.03 | ) |
Shares used in computing net income (loss) per share: | | | | | | | | | |
Basic | | 27,692 | | 21,596 | | 27,606 | | 21,471 | |
Dilutive | | 27,692 | | 21,596 | | 27,606 | | 21,471 | |
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