FORM 8-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): February 11, 1998
Expert Software, Inc.
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation)
33-89758 65-0359860
(Commission File Number) (I.R.S. Employer Identification No.)
800 Douglas Road, North Tower, 6th Floor, Coral Gables, Florida 33134
(Address of principal executive offices)
Registrant's telephone number, including area code: (305) 567-9990
800 Douglas Road, Suite 750, Coral Gables, Florida 33134
(Former name or former address if changed since last report.)
Page 1 of 6 Pages
ITEM 5. OTHER EVENT
Expert Software, Inc. reported Results for the Year and Fourth-Quarter 1997
on February 11, 1998. The text of the press release follows.
Expert Software, Inc. Announces Results
for the Year and Fourth-Quarter 1997
CORAL GABLES, Fla. -- February 11, 1998 -- Expert Software, Inc. (Nasdaq:
XPRT) today announced operating results for the year and fourth quarter ended
December 31, 1997. For the year ended December 31, 1997, revenue increased
7.1% to $33.2 million compared to $31.0 million for 1996. Net income was
$1.7 million or $0.21 per share, compared to net losses of $10.3 million or
$1.27 per share for 1996.
The Company reported fourth-quarter revenue of $9.1 million, which is an
increase of 10.2% compared to $8.2 million reported for the fourth quarter of
1996. Net income for the quarter was $0.4 million or $0.05 per share,
compared to a net income of $0.3 million or $0.04 per share for 1996.
Earnings per share are reported on a diluted basis.
The Company's balance sheet continued to improve. Working capital increased
to $7.9 million and there is no outstanding debt. Cash balances increased
during the year to $5.7 million.
Ken Currier, CEO, said, "We are continuing to build our reputation as a
leading consumer software publisher and to increase the brand awareness of
Expert Software. Our strategic relationships with high profile brand names
like Bicycle(r) playing cards, McDonald's Corporation and Sega Entertainment
should enhance the opportunity to expand our distribution worldwide and reach
more home PC owners."
"Purchases of quality home PCs priced below $1,000 steadily increased during
1997 and we anticipate that home PC sales will continue to accelerate through
1998 and beyond. Our brand recognition, coupled with our wide selection of
high quality titles, broad distribution and efficient publishing model have
produced positive results in 1997 and position the Company for further growth
in 1998," he added.
Expert Software, Inc. is a leading developer and publisher of over 120
high-quality, value-priced software titles. The Company specializes in
sophisticated yet easy-to-use programs addressing a broad array of everyday
consumer interests, including entertainment, education, lifestyle,
productivity and small office/home office. Over 25 million units of Expert
products have been sold, including Home Design 3D(r), Landscape Design 3D(r)
and Astronomer(tm). The Expert Software family of brands has expanded to
include McDonaldland(r) Software for Kids, titles from the popular Sega PC
Collection(tm), Bicycle(r) Card Games and the Gamers Choice(tm) line of classic
games. Expert Software can be found on the World Wide Web at
http://www.expertsoftware.com.
(more)
Marks mentioned above are trademarks or tradenames of Expert Software, Inc.,
except Bicycle(r), which is a trademark of The United States Playing Card
Company, McDonaldland(r) which is a trademark of McDonald's Corporation, and
Sega(r), Sega PC Collection(tm), Sonic's CD, Sonic Schoolhouse, Daytona USA and
Virtua Fighter which are trademarks of Sega. Sega is registered in the U.S.
patent and trademark office. Sega Entertainment, Inc. was formed through a
joint venture between Sega of America and SOFTBANK Holdings, Inc.
# # # #
This press release contains forward looking statements. Certain factors
could cause actual results to differ materially from those implied or
anticipated by the statements made above. These include, but are not
limited to consolidation of the consumer market, uncertainties concerning
anticipated growth in the consumer software and personal computer market,
new product releases and upgrades by the Company and its competitors,
evolving distribution channels, competition for retail space, consumer
confidence levels and other factors. Additional information on these and
other factors that could affect the Company's financial results are included
in the Company's Annual Report on Form 10-K, 1996 Annual Report and in other
documents on file with the Securities and Exchange Commission.
Expert Software, Inc.: 800 Douglas Road, North Tower, Coral Gables, Florida
33134.
Tel: (305) 567-9990 Fax: (305) 569-1111 Web: http://www.expertsoftware.com.
For more information contact::
Charles H. Murphy, 305-569-1205
Chief Financial Officer
charles_murphy@expertsw.com
EXPERT SOFTWARE, INC.
STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
Three Months Ended Year Ended
December 31, December 31,
-------------------- -------------------
1997 1996 1997 1996
--------- ---------- --------- ---------
(Unaudited(Unaudited)
Revenue $9,072 $8,234 $33,208 $31,012
--------- ---------- --------- ---------
Operating costs and
expenses:
Cost of sales 3,698 3,268 12,985 16,420
Sales and marketing
expense 3,075 2,443 10,489 9,888
General & administrative 1,069 1,389 4,554 10,124
Development 637 592 2,745 3,320
Loss on impairment of
intangibles -- -- -- 5,700
--------- ---------- --------- ---------
Total operating costs and
expenses 8,479 7,692 30,773 45,452
--------- ---------- --------- ---------
Operating income (loss) 593 542 2,435 (14,440)
Other income, net 106 3 269 92
--------- ---------- --------- ---------
Income (loss) before
income taxes 699 545 2,704 (14,348)
Provision (benefit) for
income taxes 259 202 1,001 (4,067)
--------- ---------- --------- ---------
Net income (loss) $ 440 $ 343 $1,703 $(10,281)
========= ========== ========= =========
Net income (loss) per
share of common stock $ .05 $ .04 $ .21 $ (1.27)
========= ========== ========= =========
Weighted average number of
common stock and common
stock equivalents
outstanding 8,337 7,958 8,168 8,072
========= ========== ========= =========
(more)
EXPERT SOFTWARE, INC.
BALANCE SHEETS
(In thousands)
December 31, December 31,
1997 1996
-------------- ---------------
ASSETS
Cash and equivalents $ 5,685 $ 2,959
Accounts receivable, net 4,636 3,775
Income taxes receivable 1,924 2,397
Inventories 2,922 1,256
Prepaid expenses and other 834 425
Deferred income taxes 1,616 2,616
-------------- ---------------
Total current assets 17,617 13,428
-------------- ---------------
Property and equipment, net 1,270 1,897
Deferred income taxes 3,311 3,586
Acquired intangibles 35 166
============== ===============
$ 22,233 $ 19,077
============== ===============
LIABILITIES AND
STOCKHOLDERS' EQUITY
Total current liabilities $ 9,701 $ 8,352
Noncurrent obligations -- 300
Stockholders' equity 12,532 10,425
-------------- ---------------
$ 22,233 $ 19,077
============== ===============
(End of press release)
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Dated: February 13, 1998
Expert Software, Inc.
By: /s/ Charles H. Murphy
Charles H. Murphy
Chief Financial Officer