FOR IMMEDIATE RELEASE BroadVision Contact: Kent Liu Vice President, Finance 650.542.5100 ir1@BroadVision.com
BroadVision Announces Second Quarter 2006 Results
REDWOOD CITY, CALIF. – September 25, 2006 — BroadVision, Inc. (BVSN.PK), a global provider of e-business solutions, today reported financial results for its second quarter ended June 30, 2006. Revenue for the quarter was $12.7 million, compared with revenue of $12.6 million for the first quarter ended March 31, 2006 and $15.5 million for the second quarter of 2005. License revenue for the quarter totaled $3.6 million versus $2.9 million in the prior quarter and $3.4 million in the comparable quarter of 2005.
In the second quarter, BroadVision posted net income on a generally accepted accounting principles (GAAP) basis of $1.7 million, or $0.03 per diluted share, as compared with GAAP net income of $0.9 million, or $0.02 per diluted share, for the first quarter of 2006, and a GAAP net loss of $3.0 million, or $(0.09) per diluted share, in the second quarter of 2005.
Pro forma net income for the second quarter of 2006 was $1.8 million, or $0.03 per diluted share compared with pro forma net income of $1.7 million, or $0.04 per diluted share in the first quarter of 2006 and a pro forma net loss of $3.1 million, or $(0.09) per diluted share in the second quarter of 2005. These pro forma results exclude restructuring charges and credits, gains and losses from the revaluation of convertible notes and common stock warrants, and credits from the reversal of income tax accruals. A reconciliation of pro forma results to GAAP results is provided in the financial information attached to this press release. The Company believes its pro forma results provide useful information because they reflect the Company’s financial performance excluding certain charges, credits, gains and losses that the Company believes are not indicative of its ongoing operations.
About BroadVision
BroadVision is a global provider of e-business solutions. Our agile commerce and portal applications enable customers to quickly create and adapt online processes to keep pace with changing business requirements. Large organizations — including U.S. Air Force, Audible, Cannon, Sony, Sears, City Bank, Iberia L.A.E. and Vodafone — serving nearly 75 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 or visitwww.broadvision.com.
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BROADVISION, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
June 30,
December 31,
2006
2005
(unaudited)
ASSETS
Current assets:
Cash and cash equivalents
$
13,255
$
4,849
Accounts receivable, less allowance for doubtful accounts of $1,064 as of June 30, 2006 and $731 as of December 31, 2005
10,043
12,640
Prepaids and other
1,767
1,914
Restricted cash, current portion
201
—
Total current assets
25,266
19,403
Property and equipment, net
1,884
2,334
Restricted cash and investments, net of current portion
1,796
1,997
Goodwill
25,066
25,066
Other assets
1,008
1,142
Total assets
55,020
49,942
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Current liabilities:
Current portion of bank borrowings
162
389
Current portion of convertible notes due to a related party
—
20,535
Accounts payable
2,507
4,396
Accrued expenses
15,886
16,090
Warrant liability
663
277
Unearned revenue
4,479
2,678
Deferred maintenance
12,546
10,910
Total current liabilities
36,243
55,275
Other non-current liabilities
4,535
4,390
Total liabilities
40,778
59,665
Commitments and contingencies
Stockholders’ equity (deficit):
Convertible preferred stock, $0.0001 par value; 10,000 shares authorized; none issued and outstanding
Common stock, $0.0001 par value; 2,000,000 shares authorized; 69,383 shares issued and
outstanding as of June 30, 2006 and 34,522 shares issued and outstanding as of
December 31, 2005
7
3
Additional paid-in capital
1,236,389
1,215,256
Accumulated other comprehensive income
289
93
Accumulated deficit
(1,222,443
)
(1,225,075
)
Total stockholders’ equity (deficit)
14,242
(9,723
)
Total liabilities and stockholders’ equity (deficit)
$
55,020
$
49,942
BROADVISION, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
AND COMPREHENSIVE INCOME
(In thousands, except per share data)
(unaudited)
Three Months Ended
Six Months Ended
June 30,
June 30,
2006
2005
2006
2005
(restated)
(restated)
Revenues:
Software licenses
$
3,627
$
3,391
$
6,509
$
7,807
Services
9,102
12,123
18,844
24,074
Total revenues
12,729
15,514
25,353
31,881
Cost of revenues:
Cost of software licenses
142
(186
)
204
(243
)
Cost of services
3,496
5,614
7,554
11,594
Total cost of revenues
3,638
5,428
7,758
11,351
Gross profit
9,091
10,086
17,595
20,530
Operating expenses:
Research and development
2,405
3,955
5,036
8,242
Sales and marketing
1,982
5,060
4,363
10,871
General and administrative
3,239
2,829
4,977
5,364
Restructuring charge (credit)
(15
)
309
475
(395
)
Total operating expenses
7,611
12,153
14,851
24,082
Operating income (loss)
1,480
(2,067
)
2,744
(3,552
)
Interest (expense) income, net
125
(167
)
232
(276
)
Amortization of discount on convertible notes
—
(2,365
)
—
(3,978
)
(Loss) gain on revaluation of warrants and
change in value of derivatives
(16
)
2,257
(386
)
10,248
Other (expense) income, net
226
(684
)
262
(86
)
Income (loss) before provision for income taxes
1,815
(3,026
)
2,852
2,356
Benefit (provision) for income taxes
(65
)
(70
)
(221
)
1,961
Net income (loss)
$
1,750
$
(3,096
)
$
2,631
$
4,317
Basic income (loss) per share
$
0.03
$
(0.09
)
$
0.05
$
0.13
Diluted income (loss) per share
$
0.03
$
(0.09
)
$
0.05
$
0.13
Shares used in computing:
Weighted average shares-basic
69,151
34,181
56,055
34,077
Weighted average shares-diluted
69,151
34,181
56,055
34,163
Comprehensive income:
Net income (loss)
$
1,750
$
(3,096
)
$
2,631
$
4,317
Other comprehensive gain (loss), net of tax:
Foreign currency translation adjustment
(180
)
(22
)
(196
)
23
Total comprehensive income (loss)
$
1,570
$
(3,118
)
$
2,435
$
4,340
BROADVISION, INC. AND SUBSIDIARIES
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(unaudited)
Three Months Ended
Jun. 30
Mar.31
Jun. 30
2006
2006
2005
Revenues:
(restated)
Software licenses
$
3,627
$
2,882
$
3,391
Services
9,102
9,742
12,123
Total revenues
12,729
12,624
15,514
Cost of revenues:
Cost of (credit for) software licenses
142
62
(186
)
Cost of services
3,496
4,058
5,614
Total cost of revenues
3,638
4,120
5,428
Gross profit
9,091
8,504
10,086
Operating expenses:
Research and development
2,405
2,631
3,955
Sales and marketing
1,982
2,381
5,060
General and administrative
3,239
1,738
2,829
Total operating expenses
7,626
6,750
11,844
Pro forma operating (loss) income
1,465
1,754
(1,758
)
Interest (expense) income, net
125
107
(167
)
Other income (expense), net
226
36
(684
)
Pro forma income before benefit (provision) for income taxes
1,816
1,897
(2,609
)
Provision for income taxes
(65
)
(156
)
(522
)
Pro forma net income (loss)
$
1,751
$
1,741
$
(3,131
)
Basic pro forma net income (loss) per share
$
0.03
$
0.04
($0.09
)
Diluted pro forma net income (loss) per share
$
0.03
$
0.04
($0.09
)
Shares used in computing basic pro forma net income (loss) per share
69,151
42,958
34,181
Shares used in computing diluted pro forma net income (loss) per share
69,151
43,068
34,181
Note: income tax provision numbers have not been adjusted for pro forma purposes
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