SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 6-K
REPORT OF FOREIGN ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF
THE SECURITIES EXCHANGE ACT OF 1934
For the month of June 6, 2002
MERANT plc
(Translation of Registrant's Name Into English)
The Lawn, Old Bath Road, Newbury, England RG14 1QN
(Address of Principal Executive Offices)
(Indicate by check mark whether the registrant files or
will file annual reports under cover of Form 20-F or Form 40-F.)
Form 20-F X Form 40-F _____
-------
(Indicate by check mark whether the registrant by
furnishing the information contained in this form is also thereby
furnishing the information to the Commission pursuant to Rule
12g3-2(b) under the Securities Exchange Act of 1934.)
Yes X No _____
-------
(If "Yes" is marked, indicate below the file number assigned
to the registrant in connection with Rule 12g3-2 (b): 82-795.)
LONDON STOCK EXCHANGE ANNOUNCEMENT
FOR IMMEDIATE RELEASE
CONTACTS:
MERANT
Gerald Perkel Scott Hildebrandt
Chief Executive Officer Chief Financial Officer
+1 (503) 617 2735 +1 (503) 617 2401
Gerry.Perkel@merant.com Scott.Hildebrandt@merant.com
Financial Dynamics
Harriet Keen / Emma Rutherford
+44 (0) 20 7831 3113
merant@fd.com
MERANT Announces Fourth Quarter and Fiscal 2002 Results
Company reports sequential progress in reducing its cost structure
compared to the third quarter 2002
St. ALBANS, UK and HILLSBORO, OR - 6 June 2002 - MERANT (London Stock
Exchange (LSE): MRN; Nasdaq National Market (NNM): MRNT), a leading
provider of enterprise solutions for software configuration management,
announces results for the fourth quarter and fiscal year ended 30
April 2002. Year-on-year comparisons are made on the basis of
continuing operations.
Revenue for the fourth quarter increased to GPB21.4 million ($30.4
million) from the GPB20.9 million ($30.1 million) reported in the third
quarter of 2002. Pre-tax loss from continuing operations, excluding
charges for goodwill amortization and restructuring, decreased to
GPB3.4 million ($4.9 million) from the GPB4.7 million ($6.8 million)
loss reported in the Company's third quarter.
For the full fiscal year ending April 30, 2002, revenue from continuing
operations was GPB87.1 million ($124.7 million), down from the GPB95.1
million ($139.5 million) in fiscal year 2001. The fiscal 2002 pre-tax
loss from continuing operations was GPB12.5 million ($18.0 million),
excluding amortization of goodwill and restructuring charges, compared
to the pre-tax loss of GPB3.7 million ($6.0 million) for fiscal year
2001.
"The company experienced a tremendous amount of change in fiscal 2002
against a backdrop of weak economic conditions," said Gerald Perkel,
president and CEO. "We have implemented a number of aggressive actions
to reduce our cost structure over the past several months and we were
pleased to see initial benefits of these actions in our fourth quarter.
We should continue to see total company costs decline in our first
quarter of 2003 compared to our fourth quarter of 2002, while at the
same time increasing our investment in research and development
spending to help fuel future growth opportunities.
"While global economic conditions and related IT spending have been
weak, we have a very strong customer base to build on moving forward.
We have continued our focus on promising software markets such as web
content management that leverage this installed base and on our
expertise in managing both code and content, the cornerstone of our
long-term growth strategy for the new MERANT."
Significant actions taken during fiscal 2002 to improve MERANT's
financial performance include the following:
* an entirely new senior management team has been appointed over
the last seven months. The team is led by Perkel, a former Xerox
senior vice president, who in four years nearly doubled Tektronix'
color printing and imaging business before its acquisition by Xerox in
2000. Like Perkel, the other new senior executives have significant
experience in growing emerging businesses as well as in managing costs;
* the sale of the company's non-core businesses and company-owned
real estate, freeing cash resources and allowing MERANT to focus the
business on software configuration management;
* the near completion in Q4 of a restructuring program which will
bring costs to a level appropriate for the company's ongoing
operations;
* the reduction of overall employee base by approximately 150
(25%) to 675 employees with significant reductions in overhead and
administrative functions; and
* the continued return of excess capital to shareholders through
market repurchases of our Ordinary Shares
License fees accounted for approximately 40% of total revenue for the
fourth quarter. Maintenance subscription services accounted for 46% of
total revenue for the fourth quarter. The remaining 14% of revenue
consisted of consulting and training fees. North American sales for the
fourth quarter represented 61% of total revenue. European sales
represented 34% of total revenue with the Asia-Pacific area responsible
for the remainder.
Gross margins were 75% during the fourth quarter, compared to third
quarter gross margins of 74%. Total expenses associated with continuing
operations, excluding goodwill amortization and restructuring charges,
decreased to GPB24.9 million ($35.3 million) in the fourth quarter,
compared to GPB25.6 million ($36.9 million) reported in the third
quarter. This improvement was due to the initial benefits of the
Company's restructuring and cost reduction actions initiated in the
third quarter of 2002.
The Company recorded a restructuring charge of GPB6.5 million ($9.2
million) in the fourth quarter related to resizing the business and
re-locating the headquarters from Rockville, Maryland to Hillsboro,
Oregon. Total fiscal 2002 restructuring charges were GPB13.3 million
($19.1 million). The company noted that some additional restructuring
charges remain and expect that these charges will be incurred in the
first quarter of 2003.
The Company ended the quarter with GPB71.6 million ($104.6 million)
in cash and marketable securities. Cash decreased in the fourth quarter
from the GPB83.4 million ($117.7 million) reported at the end of the
third quarter, due primarily to the repurchase of 8.5 million shares of
the Company's stock, the cash impact of the operating loss experienced,
as well as approximately GPB4.3 million ($6.1 million) related to the
cash portion of the fourth quarter restructuring charge, partially
offset by cash generated from improvement in working capital management.
During the fourth quarter the Company completed its previously approved
share repurchase program by purchasing 8.5 million shares for
cancellation, representing total payments of approximately GPB9.9
million ($14.3 million) to the selling shareholders. On 2 May 2002, the
Company announced that it had posted to shareholders a notification
containing details of the proposed authorization to buy back additional
Ordinary Shares and a notice of an extraordinary general meeting to be
held on 6 June 2002 at 9:00 a.m. BST. This is consistent with the
previously disclosed intent of the Company to return capital to
shareholders communicated to shareholders on December 12, 2001.
The Company remains cautious regarding revenue and earnings performance
in the short term as global recessionary pressures continue to impact
negatively spending in the corporate IT sector. However, the Company
has taken aggressive actions to resize business to allow for these
economic realities, and believes it will emerge stronger once the
global economies begin to improve. It remains the Company's goal to
achieve profitability during our fiscal year 2003.
Conference Call
A conference call has been scheduled for today at 4.00 pm BST (11.00 am
US EST) for investors, analysts and press to review its fourth quarter
and fiscal year ended 30 April 2002. For those wishing to participate
in the call the telephone numbers are +1 800 482 5543 for the US and
+ 44 20 8240 8243 for the UK. A replay facility will be available until
20 June 2002. The toll free numbers are +1 800 625 5288, passcode
1856610 for the US and 0500 637 880, passcode 613952 for the UK.
About MERANT
With over 25 years of experience, MERANT helps customers at over 30,000
sites worldwide, including the majority of the Global 2000, improve
their ability to manage change to enterprise digital assets -
applications, code and content. Delivering the broadest coverage of
digital assets, unsurpassed scalability and end-to-end change
management, MERANT PVCS is the comprehensive enterprise change
management platform customers use to make change a competitive
advantage. For additional information, visit www.merant.com.
Forward-Looking Statements
The following statement is made in accordance with the U.S. Private
Securities Litigation Reform Act of 1995: This release contains
forward-looking statements that include statements regarding
expectations for future financial results and results of operations,
business strategy, and prospects, including the growth and/or
performance of our software configuration management business and
related revenues.
When used in this release, the words 'anticipate,' 'believe','estimate',
'intend', 'expect', 'realize', 'likely', 'unlikely', and other similar
expressions, as they relate to MERANT or its management, are intended to
identify these forward-looking statements.
These forward-looking statements involve a number of risks and
uncertainties. Actual results could differ materially from those
anticipated by these forward-looking statements. Future results will
be difficult to predict as MERANT continues to transform its business
strategy to focus on its software configuration management products and
services and away from certain of its past primary markets, including
the market for application, creation and transformation, or COBOL,
mainframe software products and services, and the market for enterprise
data connectivity, or middleware, software products and services.
MERANT's ability to recruit and retain key personnel, especially in the
sales and business units and at the management level, could materially
alter financial results and plans for the sales and business units.
Other factors that could cause actual results to differ materially
include, among others, the extent to which the current weakness in the
economic climate generally and in IT spending in particular continues,
the ability of MERANT to effectively manage its costs against uncertain
revenue expectations, the potential for a decrease in revenue or a
slowdown in revenue growth which may be caused by delays in the timing
of sales and the delivery of products or services, the ability of MERANT
to develop, release, market and sell products and services to customers
in the highly dynamic market for software configuration management
products, the potential need for software configuration management
products to shift based on changes in technology and customer needs,
effect of competitors' efforts to enter MERANT's markets and the
possible success of new and existing competitors in those markets,
MERANT's ability to manage and integrate recently acquired businesses
or other businesses that it may acquire in the future, as well as
efficiently manage the provision or receipt, as the case may be,of
certain services related to businesses or products which once were, but
are not now a part of MERANT's business strategy, including MERANT's
ability to manage obligations related to the sales of the DataDirect
enterprise data connectivity business and the Micro Focus application,
creation and transformation division, and MERANT's ability to manage
the move of its operational headquarters and related functions from
Rockville, MD to Hillsboro, OR. Further information on potential
factors which could affect MERANT's financial results and operations
are found in filings or submissions on Form 6-K as periodically
submitted to the SEC, and in MERANT's form 20-F for the year ended
April 30, 2001. MERANT undertakes no obligation to release publicly
any updates or revisions to any forward-looking statements contained
in this release that may reflect events or circumstances occurring
after the date of this release.
Financial Statement Information
The financial information contained in this report does not represent
the Company's full statutory accounts. The financial information
relating to 2002 is unaudited and no accounts have been delivered to
the U.K. Registrar of Companies. Statutory accounts dealing with 2001
have been delivered to the U.K. Registrar of Companies and the
Company's auditors made a report under section 235 on these accounts
which was unqualified and did not contain a statement under section
237(2) or section 237(3) of the Companies Act 1985.
U.S. Securities Filings
Copies of MERANT's Annual Report to Shareholders and Annual Report on
Form 20-F for the year ended April 30, 2001, as well as its periodic
reports on Form 6-K, are available upon request to MERANT's offices
in Hillsboro, OR or St. Albans, United Kingdom and are also available
on the SEC website located at http://www.sec.gov.
MERANT plc
Management Trading Statement using U.K. GAAP results in GBP
(unaudited)
Three months ending: Twelve months ending:
April 30,April 30,April 30,April 30,
2002 2001 2002 2001
GPB'000 GPB'000 GPB'000GPB'000
Revenue: continuing business
Licence fees 8,667 11,411 33,387 42,193
Maintenance subscriptions 9,865 9,436 39,779 35,065
Training and consulting 2,909 4,441 13,902 17,817
Total revenue 21,441 25,288 87,068 95,075
Cost of revenue: continuing business
Cost of licence fees 370 567 1,429 2,164
Cost of maintenance subscriptions 1,546 1,447 5,855 5,490
Cost of training and consulting 3,446 4,706 13,832 17,198
Total cost of revenue 5,362 6,720 21,116 24,852
Gross profit 16,079 18,568 65,952 70,223
Operating expenses
Research and development 4,550 4,289 17,836 16,087
Sales and marketing 11,641 12,056 46,900 44,327
General and administrative 3,337 3,387 13,740 13,549
Total operating expenses, excluding amortisation 19,528 19,732 78,476 73,963
Operating (loss) profit before amortisation (3,449) (1,164) (12,524)(3,740)
Amortisation of goodwill (7,340) (5,489)(29,429)(25,058)
Total operating (loss) (10,789)(6,653)(41,953)(28,798)
Exceptional items:
Cost of fundamental restructuring (6,484) 0 (13,342)0
Provision for loss on disposal of fixed assets 0 0 (1,761) (3,254)
Operating (loss), before interest income (17,273)(6,653)(57,056)(32,052)
Interest income, net 313 782 1,614 4,287
(Loss) before taxation (16,960)(5,871)(55,442)(27,765)
Taxation 0 (868) 0 (868)
(Loss) for the period from continuing operations,
after taxation (16,960)(6,739)(55,442)(28,633)
Income (loss) from discontinued operations (1,343) 3,955 (3,445)(10,964)
Gain (loss) on sale of discontinued operations (958) (11,317)292 (11,317)
(Loss) after taxation (19,261)(14,101)(58,595)(50,914)
(Loss) per ordinary share: basic & diluted (16.5) (11.0) (46.8) (37.9)
(Loss) per ADR equivalent: basic & diluted (82.5) (54.8) (234.2) (189.5)
Ordinary shares - basic & diluted 116,682 128,694 125,092 134,305
ADR equivalents - basic & diluted 23,336 25,739 25,018 26,861
MERANT plc
Management Trading Statement using UK GAAP results in USD
(unaudited) Three months ending:Twelve months ending:
April 30,April 30,April 30,April 30,
2002 2001 2002 2001
$'000 $'000 $'000 $'000
Revenue: continuing business
Licence fees 12,279 16,018 47,648 61,564
Maintenance subscriptions 13,975 13,571 57,095 51,653
Training and consulting 4,122 6,397 19,918 26,308
Total revenue 30,376 35,986 124,661 139,525
Cost of revenue: continuing business
Cost of licence fees 524 801 2,042 3,078
Cost of maintenance subscriptions 2,190 2,080 8,392 8,082
Cost of training and consulting 4,882 6,826 19,844 25,393
Total cost of revenue 7,596 9,707 30,278 36,553
Gross profit 22,780 26,279 94,383 102,972
Operating expenses
Research and development 6,446 6,167 25,561 23,711
Sales and marketing 16,492 17,347 67,221 65,302
General and administrative 4,728 4,796 19,595 19,987
Total operating expenses, excluding amortisation 27,666 28,310 112,377 109,000
Operating (loss) profit before amortisation (4,886) (2,031) (17,994)(6,028)
Amortisation of goodwill (10,520)(7,867)(42,181)(35,916)
Total operating (loss) (15,406)(9,898)(60,175)(41,944)
Exceptional items:
Cost of fundamental restructuring (9,184) 0 (19,098)0
Provision for loss on disposal of fixed assets 0 0 (2,524) 0
Operating (loss), before interest income (24,590)(9,898)(81,797)(41,944)
Interest income, net 443 1,285 2,315 6,154
(Loss) before taxation (24,147)(8,613)(79,482)(35,790)
Taxation 0 1,250 0 1,250
(Loss) for the period from continuing operations,
after taxation (24,147)(9,863)(79,482)(37,040)
Income (loss) from discontinued operations (1,925) 5,669 (4,938) (15,715)
Gain (loss) on sale of discontinued operations (1,373) (16,221) 419 (16,221)
(27,445)(20,415)(84,001)(68,976)
(Loss) per ordinary share: basic & diluted (23.9) (15.9) (67.4) (51.4)
(Loss) per ADR equivalent: basic & diluted (119.4)(79.3) (336.9)(256.8)
Ordinary shares - basic & diluted 114,932 128,694 124,655 134,305
ADR equivalents - basic & diluted 22,986 25,739 24,931 26,861
MERANT plc - CONSOLIDATED PROFIT & LOSS ACCOUNT
(unaudited) Twelve months ending:
April 30, April 30,
2002 2001
GPB'000 GPB'000
Revenue: continuing business
Licence fees 33,387 42,193
Maintenance subscriptions 39,779 35,065
Training and consulting 13,902 17,817
87,068 95,075
Revenue: discontinued business 31,207 120,358
Total revenue 118,275 215,433
Cost of revenue: continuing business
Cost of licence fees 1,429 2,164
Cost of maintenance subscriptions 5,855 5,490
Cost of training and consulting 13,832 17,198
21,116 24,852
Cost of revenue: discontinued business 5,510 29,534
Total cost of revenue 26,626 54,386
Gross profit 91,649 161,047
Operating expenses
Research and development 24,187 39,774
Sales and marketing 58,922 103,667
General and administrative 18,616 16,841
Total operating expenses, excluding amortisation 101,725 160,282
Operating (loss) profit before amortisation (10,076) 765
Amortisation of goodwill (35,322) (40,527)
Operating (loss):
Continuing business (41,953) (28,798)
Discontinued business (3,445) (10,964)
Total operating (loss) (45,398) (39,762)
Exceptional items:
Cost of fundamental restructuring (13,342) 0
Provision for loss on disposal of fixed assets (1,761) (3,254)
Gain (loss) on termination of business operations 292 (11,317)
Operating (loss), before interest income (60,209) (54,333)
Interest income, net 1,614 4,287
(Loss) before taxation (58,595) (50,046)
Taxation 0 868
(Loss) for the period after taxation (58,595) (50,914)
(Loss) per ordinary share: basic & diluted (46.8p) (37.9p)
Ordinary shares - basic & diluted 125,092 134,305
MERANT plc - CONSOLIDATED BALANCE SHEET
(unaudited) April 30, April 30,
2002 2001
GPB'000 GPB'000
Fixed assets
Intangible fixed assets 21,782 75,383
Tangible fixed assets 6,284 28,313
Investment 5,858 6,860
Total fixed assets 33,924 110,556
Current assets:
Stock 94 610
Trade debtors 22,115 52,789
Other debtors and prepaid expenses 2,792 5,620
Cash and bank deposits 71,620 61,200
Total current assets 96,621 120,219
Creditors: amounts falling due within one year
Bank loans and overdrafts 0 1,401
Trade creditors 2,612 7,319
Accrued employee compensation 5,220 13,700
Current corporation tax 580 2,606
Accrued expenses and other current liabilities 9,091 14,234
Deferred revenue 27,967 51,498
Total current liabilities 45,470 90,758
Net current assets 51,151 29,461
Total assets less current liabilities 85,075 140,017
Provision for liabilities and charges 22,429 11,551
Net assets 62,646 128,466
Capital and reserves
Called up share capital 2,300 2,699
Share premium account 200,865 200,625
Capital redemption reserve 697 292
Profit and loss account (141,216) (75,150)
Total shareholders' equity 62,646 128,466
MERANT plc - CONSOLIDATED CASH FLOW STATEMENT
(unaudited) April 30, April 30,
2002 2001
GPB'000 GPB'000
Operating Loss (45,398) (39,762)
Depreciation 7,632 8,789
Amortisation 35,707 43,967
Changes in operating assets and liabilities (10,077) 15,788
Restructuring charges (8,441) (9,901)
Other items (2,175) 837
Net cash flow from operating activities (22,752) 19,718
Returns on investments 1,614 4,287
Taxation (2,026) (1,889)
Capital expenditure and financial investment 10,318 (8,223)
Acquisitions and disposals 44,984 (12,962)
Cash inflow before financing 32,138 931
Finance (24,698) (13,993)
Increase (decrease) in cash balances 7,440 (13,062)
Decrease in debt 1,404 362
Currency translation difference 2,977 (5,281)
Movement in cash during the period 11,821 (17,981)
Net funds at beginning of period 59,799 77,780
Net funds at end of period 71,620 59,799
MERANT plc - CONSOLIDATED STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
(unaudited) Twelve months ending:
April 30, April 30,
2002 2001
GPB'000 GPB'000
Loss for the period (58,595) (50,914)
Currency translation adjustment 4,252 (5,116)
Total recognised gains and losses for the period (54,343) (56,030)
- -
SIGNATURES
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, thereunto duly
authorized.
MERANT plc
(Registrant)
Date: June 6, 2002 By: /s/ Stephen Going
-------------------------------
Stephen Going
Vice President & General Counsel