SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Month of March 2004
GENESYS S.A.
(Exact name of registrant as specified in its charter)
L'Acropole, 954-980 avenue Jean Mermoz, 34000
Montpellier, FRANCE (Address of principal
executive offices)
Indicate by check mark whether the registrant files or will file annual
reports under cover Form 20-F or Form 40-F.
Form 20-F X Form 40-F
---- -------
Indicate by check mark if the registrant is submitting the Form 6-K in paper as
permitted by Regulation S-T Rule 101(b)(1):____
Indicate by check mark if the registrant is submitting the Form 6-K in paper as
permitted by Regulation S-T Rule 101(b)(7):____
Indicate by check mark whether by furnishing the information contained
in this Form, the registrant is also thereby furnishing the information
to the Commission pursuant to Rule 12g3-2(b) under the Securities
Exchange Act of 1934.
Yes No X
------- ----------
If "Yes" is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b): 82-_______________.
[Genesys Conferencing Logo]
Genesys Conferencing Reports Q4 and 2003
Financial Results
Denver, Colorado and Montpellier, France - March 31, 2004 -- Genesys
Conferencing (Euronext: 3955) (Nasdaq: GNSY), a leading multimedia conferencing
specialist, today reported financial results for the fourth quarter and fiscal
year ended December 31, 2003. All results are reported under French Generally
Accepted Accounting Principles (GAAP).
(in millions) USD(1) EUR USD(1) EUR
------ --- ---- ---
Revenue
Q4 2003 $ 42.0 (euro) 35.3 2003 $ 179.8 (euro) 159.5
Q4 2002 $ 46.4 (euro) 46.4 2002 $ 189.5 (euro) 201.4
Change % -9.6% -24.0% -5.1% -20.8%
EBITDA(2)
Q4 2003 $ 8.3 (euro)7.0 2003 $ 40.7 (euro)36.2
Q4 2002 $ 6.9 (euro)6.9 2002 $ 28.1 (euro)29.9
Change % +20.3% +1.4% +44.8% +21.0%
"Increased gross margins, greater productivity and improved cash flow in 2003
are the result of comprehensive operating initiatives we began to implement in
2002" said Francois Legros, Chairman and Chief Executive Officer. "With
significantly reduced overhead costs and increased profitability, we will
concentrate a greater percentage of our resources on efforts directed at
increasing user adoption of our fully-integrated multimedia conferencing
services and penetration of our core customer segments."
2003 Accomplishments
o Total volume of 1.3 billion minutes, 32.1% growth in automated and
multimedia minutes
o Created and introduced bundled Multimedia Minute pricing strategy for
delivering fully integrated audio, video and Web services
o Consolidated nine production facilities into three global centers
o Implemented single, unified MIS platform
Automated Services and Cost Improvements Drive Performance in Fourth Quarter and
2003
In U.S. dollars, fourth quarter 2003 revenue was $42.0 million compared to $46.4
million in the prior year, a 9.6% decline. Fourth quarter 2003 revenue was
(euro)35.3 million compared to (euro)46.4 million last year, reflecting exchange
rate fluctuation, price erosion and the continuing shift to automated services,
which carry higher margins but generate lower per-minute revenues than
operator-assisted services. As anticipated, in U.S. dollars, 2003 revenue was
$179.8 million compared to $189.5 million in 2002, a 5.1% decline.
Total call volumes were 323 million minutes in the fourth quarter of 2003, up
2.6% from the prior year. Automated services call volumes were up 15% from the
fourth quarter of 2002. Automated services represented approximately 72.4% of
total revenue in the fourth quarter and 87% of total audio volume.
For 2003, total call volumes were 1.3 billion minutes, up 13.3% from 1.2 billion
in the prior year including a 32.1% increase in automated services call volumes
from the prior year. The company expects the migration of its revenue mix
towards a greater percentage of higher-margin, but lower-priced automated and
multimedia conferencing services to continue through 2004 until revenue from
those services represent at least 80% of total revenues.
Francois Legros commented that "Since the introduction of the Multimedia Minute
pricing plan which is targeted to high volume, large enterprise buyers who seek
a transparent, usage based pricing methodology for simplifying their procurement
of audio, Web and video conferencing services, we are experiencing a higher
adoption rate of multimedia services by new and existing users."
Gross margin increased to 65.1%, compared to 55.9% in the fourth quarter of
2002, primarily as a result of greater cost efficiencies and higher productivity
of the consolidated production centers, as well as the continuing improvement of
our mix of higher-margin automated services. For 2003, gross margin increased to
64.3% in 2003 from 56.6% in 2002.
Selling, general and administrative expenses, excluding non-recurring charges,
in the fourth quarter of 2003 declined 7.2% to $23.1 million compared to $24.9
million in the fourth quarter of 2002. In euros, fourth quarter 2003 selling,
general and administrative expenses, excluding non-recurring charges were
(euro)19.4 million, compared to (euro)24.9 million in the fourth quarter of
2002. The improvement in selling, general and administrative expenses was
primarily due to the Company's continuing cost-reduction initiatives, including
the greater centralization of certain operations and functional groups. For the
full year 2003 selling, general and administrative expenses, excluding
non-recurring charges, were reduced 10.1% to $89.4 million compared to $99.4
million in 2002. In euros, 2003 selling, general and administrative expenses,
excluding non-recurring charges, were (euro)79.0million as compared to
(euro)105.7 million in 2002.
Earnings before interest, taxes, depreciation and amortization (EBITDA(2)),
before non-recurring charges, in U.S. dollars, was $8.3 million for the fourth
quarter 2003 compared to $6.9 in the same period last year. Fourth quarter 2003
EBITDA, before non-recurring charges, was (euro)7.0 million compared to
(euro)6.9 million in the prior-year period. EBITDA for the fourth quarter of
2003 excluded non-recurring charges of approximately (euro)0.5 million
representing costs associated with employee-related separations. In U.S.
dollars, 2003 EBITDA, before non-recurring charges, increased 44.8% to $40.7
million compared to $28.2 million in 2002. In line with previous guidance,
EBITDA before non-recurring charges, increased to (euro)36.2 million in 2003,
compared to (euro)29.9 million in 2002.
The Company evaluated the carrying value of its long-lived assets, consisting
primarily of goodwill and intangible assets. For the fourth quarter of 2003, a
reduction of (euro)33.0 million in the carrying value of intangible and other
long-lived assets was recorded as a result of this assessment.
Liquidity
The Company improved its net cash position from (euro)6.6 million (or $ 6.9
million) at December 31, 2002, to (euro)17.8 million (or $22.5 million) as of
December 31, 2003, including (euro) 5.4 million of net proceeds from a rights
offering. Capital expenditures totaled (euro)9.5 million (or $10.9 million) for
2003, including (euro)3.5 million (or $4.1 million) related to fiscal 2004
capital expenditures which were accelerated into December 2003 in order to take
advantage of certain purchase incentives.
"Our increase in cash on hand demonstrates the company's improving ability to
generate free cash flow from operations and to support its capital structure"
said Michael E. Savage, Executive Vice President and Chief Financial Officer.
The company's leverage ratio, net debt to EBITDA(2), improved to 2.5x at the end
of 2003 from 3.9x at fiscal year end 2002.
Guidance 2004
The following contains forward-looking guidance regarding Genesys' financial
outlook and is based on current expectations. The company anticipates the
following factors will contribute to its near-term revenue and EBITDA
performance:
o Volume growth from automated and multimedia conferencing services
o Greater penetration of high-volume, price-competitive large enterprise
customers
o Industry-wide price erosion
o Further centralization of functional operating teams and processes
o Continued weakness of U.S. dollar
2004 Guidance
(in millions) USD(3) EUR
---- ---
Revenue $175 to $181 (euro) 140 to(euro)145
EBITDA $40 to $44 (euro)32 to(euro)35
2004 EBITDA forecast excludes expected non-recurring items of approximately
(euro)2.0 million related to the company's anticipated cost reduction
initiatives, including its efforts to further centralize functional teams and
processes.
Conference Call and Webcast
Chief Executive Officer Francois Legros and Executive Vice President/Chief
Financial Officer Michael E. Savage will host a conference call on Wednesday,
March 31, 2004, at 5:30 p.m. Central European Time or 10:30 a.m. Eastern
Standard Time to discuss 2003 financial results.
The conference call will be webcast live and may be accessed at www.genesys.com.
A replay of the call will be available at www.genesys.com.
____________
(1) USD amounts were calculated using the average quarterly exchange rate.
(2) EBITDA before non-recurring expenses. See attached Note to consolidated
statements of operations for reconciliation of Operating Income and EBITDA.
(3) USD amounts were calculated using an analyst consensus for expected average
2004 exchange rates of (euro)1.00 = $ 1.25.
Financial Tables to follow.
Forward-Looking Statements
This release contains statements that constitute forward-looking statements
within the meaning of the U.S. Private Securities Litigation Reform Act of 1995.
Forward-looking statements are statements other than historical information or
statements of current condition. These statements appear in a number of places
in this release and include statements concerning the parties' intent, belief or
current expectations regarding future events and trends affecting the parties'
financial condition or results of operations. Forward-looking statements are not
guarantees of future performance and involve risks and uncertainties, and actual
results may differ materially from those in the forward-looking statements as a
result of various factors. Some of these factors are described in the Form 20-F
that was filed by Genesys with the Securities and Exchange Commission on May 15,
2003. Although management of the parties believe that their expectations
reflected in the forward-looking statements are reasonable based on information
currently available to them, they cannot assure you that the expectations will
prove to have been correct. Accordingly, you should not place undue reliance on
these forward-looking statements. In any event, these statements speak only as
of the date of this release. Except to the extent required by law, the parties
undertake no obligation to revise or update any of them to reflect events or
circumstances after the date of this release, or to reflect new information or
the occurrence of unanticipated events.
About Genesys Conferencing
Genesys Conferencing is a global leader in integrated multimedia conferencing,
providing a full range of practical and innovative real-time collaboration and
conferencing services to over 18,000 clients worldwide. A leading multimedia
conferencing specialist, with an unmatched global presence, Genesys Conferencing
has established its integrated multimedia technology in 21 countries throughout
Europe, Asia Pacific and North America. Genesys Conferencing is listed on the
Nouveau Marche in Paris (Euronext: 3955) and Nasdaq (GNSY). Additional
information is available at www.genesys.com.
At Genesys Conferencing
Michael E. Savage
Executive Vice President and Chief Financial Officer
Phone: +33 4 99 13 27 66
mike.savage@genesys.com
Marine Pouvreau
Investor Relations
Phone: +33 4 99 13 25 17
marine.pouvreau@genesys.com
Tricia Heinrich
Public Relations
Phone: +1 415 608 6651
tricia.heinrich@genesys.com
Genesys Conferencing
French GAAP Consolidated Balance Sheets (in thousands of Euros)
At December 31,
-------------- -- --------------
2002 2003
-------------- --------------
ASSETS
Fixed assets
Goodwill, net (euro)77 504 (euro)54 992
Intangible assets, net 80 715 47 504
Tangible assets, net 27 502 22 014
Financial assets, net 1 194 1 255
Investments in affiliated companies 118 141
- ------------------------------------------------------------------- -------------- --------------
Total fixed assets 187 033 125 906
Current assets
Inventory 72 29
Accounts receivable, less allowances ((euro)3,502
and (euro)2,537 at December 31, 2002 and 2003, respectively) 35 929 30 206
Deferred tax assets 361 840
Other current assets 7 919 10 600
Prepaid expenses and deferred charges 5 834 4 858
Marketable securities 109 9 614
Cash at bank 9 886 12 094
- ------------------------------------------------------------------- -------------- --------------
Total current assets 60 110 68 241
- ------------------------------------------------------------------- -------------- --------------
Total assets (euro)247 143 (euro)194 147
============== ==============
LIABILITIES AND SHAREHOLDERS' EQUITY
Shareholders' Equity
Ordinary shares, nominal value of(euro)5 and(euro)1 per share at
Dec. 31, 2002 and 2003, respectively ; 15,409,933 and
18,307,756 shares issued and outstanding at Dec. 31, 2002 and
2003, respectively (euro)77 051 (euro)18 308
Common shares to be issued 1 332 140
Additional paid-in capital 180 652 185 080
Additional paid-in capital to be issued 6 344 3 844
Accumulated deficit (103 250) (137 950)
Net loss for the period (96 617) (36 544)
Currency translation adjustments 8 111 15 945
- ------------------------------------------------------------------- -------------- --------------
Total shareholders' equity 73 623 48 823
Provisions for risks and charges 7 505 5 558
Long-term debt
Long-term portion of long term debt 119 537 82 445
Long-term portion of capitalized lease obligations 673 298
- ------------------------------------------------------------------- -------------- --------------
Total long-term debt 120 210 82 743
Current liabilities
Bank overdrafts 3 417 3 850
Accounts payable and accrued liabilities 20 276 14 353
Tax payable and deferred compensation 15 553 15 611
Current portion of long-term debt 2 390 19 144
Current portion of capitalized lease obligations 1 844 572
Deferred revenue 352 88
Other liabilities 1 973 3 405
- ------------------------------------------------------------------- -------------- --------------
Total current liabilities 45 805 57 023
-------------- --------------
Total liabilities and shareholders' equity (euro)247 143 (euro)194 147
============== ==============
Genesys Conferencing
French GAAP Consolidated Statements of Operations
(in thousands of Euros, except share data)
Three Months Twelve months
ended December 31, ended December 31,
-------------------------------------- ---------------------------------
2002 2003 2002 2003
----------------- ----------------- -------------- ---------------
Revenue
Services (euro) 46 234 (euro) 35 233 (euro)199 778 (euro) 159 155
Products 169 50 1 595 345
- ------------------------------------------------- ----------------- ----------------- -------------- ---------------
46 403 35 283 201 373 159 500
Cost of Revenue
Services 20 323 12 320 86 161 56 736
Products 136 8 1 250 207
- ------------------------------------------------- ----------------- ----------------- -------------- ---------------
20 459 12 328 87 411 56 943
----------------- ----------------- -------------- ---------------
Gross Profit 25 944 22 955 113 962 102 557
Operating expenses
Research and development expenses 1 127 1 055 4 734 4 183
Selling and marketing expenses 10 776 8 934 49 976 37 394
General and administrative expenses 14 397 9 858 58 631 39 032
Restructuring charge 598 540 598 2 147
Amortization of identifiable intangible assets 14 849 24 631 25 782 31 805
- ------------------------------------------------- ----------------- ----------------- -------------- ---------------
41 747 45 018 139 721 114 561
----------------- ----------------- -------------- ---------------
Operating loss (15 803) (22 063) (25 759) (12 004)
Financial expense, net (1 777) (1 436) (10 884) (7 201)
Equity in income (loss) of affiliated companies 7 12 (8) 22
Income tax credit (expense) (848) 594 (3 442) (1 982)
Amortization of goodwill (49 060) (11 370) (56 524) (15 379)
- ------------------------------------------------- ----------------- ----------------- -------------- ---------------
Net loss (euro) (67 481) (euro) (34 263) (euro)(96 617) (euro) (36 544)
================= ================= ============== ===============
Basic and diluted net loss per share (euro) (4,34) (euro) (1,87) (euro) (6,22) (euro) (2,20)
----------------- ----------------- -------------- ---------------
Number of outstanding shares used 15 547 280 18 364 462 15 541 898 16 579 986
in computing basic and diluted net
loss per share
Genesys Conferencing
Notes to French GAAP Consolidated Statements of Operations
(in thousands of Euros)
Three months ended Twelve months ended
December 31, December 31,
--------------------------- ---------------------------
2002 2003 2002 2003
------------- ------------- ------------- -------------
NOTE A- EBITDA calculation
General and Administrative expenses (euro)14 397 (euro)9 858 (euro)58 631 (euro)39 032
Amortization of deferred acquisition and deferred financing
costs (418) (384) (1 669) (1 570)
------------- ------------- ------------- -------------
Operating General and Administrative expenses
before amortization of deferred acquisition and deferred
financing costs (euro) 13 979 (euro) 9 474 (euro) 56 962 (euro) 37 462
============= ============= ============= =============
Operating loss (euro) (15 803)(euro)(22 063)(euro)(25 759)(euro)(12 004)
Amortization of identifiable intangible assets 14 849 24 631 25 782 31 805
Amortization of deferred acquisition and deferred financing
costs 418 384 1 669 1 570
Exceptional charges (income) 21 8 (71) 150
------------- ------------- ------------- -------------
Operating income (loss) restated for the above items (515) 2 960 1 621 21 521
------------- ------------- ------------- -------------
Depreciation and operating provision 5 792 3 477 20 039 12 498
------------- ------------- ------------- -------------
EBITDA 5 277 6 437 21 660 34 019
------------- ------------- ------------- -------------
Early termination of a Rich Media contract - - 3 231 -
Restructuring charge and separation costs 1 588 540 3 349 2 147
Other non-recurring expenses - - 1 700 -
------------- ------------- ------------- -------------
EBITDA before non-recurring expenses (euro) 6 865 (euro) 6 977 (euro) 29 940 (euro) 36 166
Three months ended Twelve months ended
NOTE B- Detail of financial expenses, net December 31, December 31,
--------------------------- ---------------------------
2002 2003 2002 2003
------------- ------------- ------------- -------------
Interest and other financial income (euro) 26 (euro) 35 (euro) 191 (euro) 124
Foreign exchange gains 1 629 621 3 718 2 698
------------- ------------- ------------- -------------
Total financial income 1 655 656 3 909 2 822
Interest and other financial expenses 2 020 1 500 9 832 7 005
Foreign exchange losses 1 412 592 4 961 3 018
------------- ------------- ------------- -------------
Total financial charges 3 432 2 092 14 793 10 023
Financial expense, net (euro)(1 777) (euro)(1 436)(euro)(10 884) (euro)(7 201)
============= ============= ============= =============
Three months ended Twelve months ended
December 31, December 31,
--------------------------- ---------------------------
2002 2003 2002 2003
------------- ------------- ------------- -------------
NOTE C- DETAIL OF INCOME TAX EXPENSE
Deferred tax (expense) credit (euro) (127) (euro) 781 (euro) (117) (euro) 548
Income tax expense (720) (187) (3 324) (2 530)
------------- ------------- ------------- -------------
Total income tax (expense) credit (euro) (847) (euro) 594 (euro)(3 441)(euro) (1 982)
============= ============= ============= =============
US GAAP ANNEX
GENESYS S.A.
U.S. GAAP CONSOLIDATED BALANCE SHEETS
December 31,
-------------------------------------------
2002 2003
---------------------- --------------------
ASSETS (in thousands of Euros, except share data)
Current assets:
Cash and cash equivalents (euro) 9,976 (euro) 15,574
Short-term portion of restricted cash - 3,371
Accounts receivable, less allowances of(euro)3,502 and(euro)2,537
at December 31, 2002 and 2003, respectively 35,930 30,206
Inventory 72 29
Prepaid expenses 1,874 2,286
Other current assets 5,261 8,856
---------------------- --------------------
Total current assets 53,113 60,322
Property and equipment, net 32,234 27,284
Goodwill, net 79,963 75,047
Customer lists, net 77,594 42,774
Technology, net 630 350
Other intangibles, net 26 2
Investment in affiliated company 118 141
Deferred tax assets 361 840
Deferred financing costs, net 3,797 2,531
Other assets 1,897 1,824
Long-term portion of restricted cash - 2,722
---------------------- --------------------
Total assets (euro) 249,733 (euro) 213,837
====================== ====================
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Bank overdrafts 3,417 3,850
Accounts payable 14,344 8,676
Accrued liabilities 7,178 6,627
Accrued compensation 6,555 6,519
Tax payable 8,998 9,092
Deferred revenue 352 88
Current portion of long-term debt 1,143 18,564
Current portion of capitalized lease obligations 191 55
Current portion of deferred tax liability 3,097 2,143
Current portion of other long-term liability 2,284 1,740
Other current liabilities 1,759 3,242
---------------------- --------------------
Total current liabilities 49,318 60,596
Long-term portion of long-term debt 120,165 82,814
Long-term portion of capitalized lease obligations 149 107
Long-term portion of deferred tax liability 20,666 11,504
Other long-term liability 6,644 3,173
Commitments and contingencies - -
Shareholders' equity:
Ordinary shares; (euro)5.00 nominal value and 15,409,933 shares issued and
outstanding at December 31, 2002 and (euro)1.00 nominal value
and 18,307,756 shares issued and outstanding at December 31, 2003 77,050 18,308
Common shares to be issued :(euro)5.00 nominal value and 137,347 shares -
at December 31, 2002 and(euro)1.00 nominal value and
65,067 shares at December 31, 2003 687 65
Additional paid-in capital 194,217 197,611
Accumulated other comprehensive income 6,980 15,372
Deferred compensation (220) (322)
Accumulated deficit (225,172) (174,640)
---------------------- --------------------
53,542 56,394
Less cost of treasury shares : 22,131 shares at December 31, 2002 and 2003 (751) (751)
---------------------- --------------------
Total shareholders' equity 52,791 55,643
---------------------- --------------------
Total liabilities and shareholders' equity (euro) 249,733 (euro) 213,837
====================== ====================
GENESYS S.A.
U.S. GAAP CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share data)
Three Months ended December 31, Year ended December 31,
---------------------------------------------------------------------
2002 2003 2002 2003
---------------------------------------------------------------------
(in thousands, except share data)
Revenue :
Services (euro) 46,233 (euro) 35,233 (euro) 199,068 (euro)159,155
Products 169 50 1,595 345
---------------------------------------------------------------------
46,402 35,284 200,663 159,500
Cost of revenue :
Services 20,355 12,372 86,193 56,936
Products 136 8 1,250 207
---------------------------------------------------------------------
20,491 12,380 87,443 57,143
---------------------------------------------------------------------
Gross profit
25,911 22,904 113,220 102,357
Operating expenses :
Research and development 1,127 1,055 4,734 4,183
Selling and marketing 10,776 8,934 49,976 37,394
General and administrative 14,040 9,299 56,487 37,729
Non-recurring charge 665 1,115 4,336 1,115
Impairment of goodwill and other intangibles 93,613 28,057 93,613 28,057
Amortization of goodwill and other intangibles 2,617 1,761 13,888 9,595
---------------------------------------------------------------------
Total operating expenses 122,838 50,221 223,034 118,073
Operating loss (96,927) (27,317) (109,814) (15,716)
Financial income (expense)
Interest income - 24 99 219
Interest expense (1,553) (1,261) (9,256) (6,818)
Foreign exchange gain (loss) 2,736 (1,936) 1,276 3,679
Other financial income (expense), net (277) (724) (1,106) (1,581)
---------------------------------------------------------------------
Financial expense, net
906 (3,898) (8,987) (4,501)
Equity in loss of affiliated company 7 11 (8) 22
---------------------------------------------------------------------
Loss before taxes
(96,015) (31,204) (118,809) (20,195)
Income tax (expense) / credit 4,023 8,930 5,043 8,842
---------------------------------------------------------------------
Net loss (euro) (91,992) (euro) (22,274) (euro) (113,766) (euro) (11,353)
======================================================================
----------------------------------------------------------------------
Basic and diluted net loss per share (euro) (5.92) (euro) (1.21) (euro) (7.32) (euro) (0.69)
======================================================================
Number of shares used in computing basic
and diluted net loss per share 15,547,280 18,364,462 15,541,898 16,579,986
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.
Dated: March 31, 2004
GENESYS SA
By: /s/ Francois Legros
--------------------------------------------
Name: Francois Legros
Title: Chairman and Chief Executive Officer