Exhibit 99.2
NEWS ANNOUNCEMENT
BRIGHT STATION ANNOUNCES SOLID PROGRESS AND STRONG
GROWTH IN RESULTS FOR FOURTH QUARTER AND FULL YEAR 2000
London, 28th February 2001, Bright Station plc (LSE: BSN, NASDAQ: BSTN)
(www.brightstation.com), the technology company and leading provider of Internet
and eCommerce solutions, today announced its fourth quarter results for the
three month period ending 31st December 2000, and its full year results for the
calendar year to 31st December 2000.
Highlights:
- -----------
o The Group has continued to invest in the operating subsidiaries,
building management teams and formalising infrastructures that have
accelerated revenue growth in the second half;
o Smartlogik, Bright Station's largest division, delivered revenues up
42% on Q3 2000 and 134% over Q4 1999 illustrating strong momentum in
the business;
o OfficeShopper revenues grew 79% for the full year 2000 over 1999
to (pound)1.6 million;
o Sparza integrated boo.com technology and secured important reseller and
partnership alliances with Egremont, Deutsche Post Fulfilment GmbH,
Intel and Lakewest;
o Group full year revenues reached (pound)8.5 million with Q4 2000
revenues of (pound)2.7 million up 66% over Q4 1999;
o Closing cash balances for the year were (pound)16.3 million.
Allen Thomas, Chairman Bright Station plc, comments:
"2000 saw a dramatic transformation of our business. During the year we
successfully carved out significant niches in two of the largest and highest
growth areas in the B2B Internet technology space - knowledge management/
information retrieval and eCommerce.
Through 2000 we put in place both the people and the resources to leverage the
value in our underlying businesses. By year-end they had demonstrated real
growth.
The strong closing quarter of 2000 saw us winning some significant new business
across the Group and set the pattern for early 2001. Bright Station is now well
positioned to achieve the returns and release the value from our technologies
that our shareholders expect. Due to the strength of our proprietary
technologies and the customer-focused nature of our propositions, we confidently
expect strong sequential revenue growth during 2001 and when market conditions
improve we intend to IPO our Smartlogik business."
Financial Review
Revenues for the full year were (pound)8.5 million. In Q4 2000 revenues
increased by 14.6 % to (pound)2.7 million over Q3 2000 ((pound)2.4 million) and
up 66% over Q4 1999, for continuing businesses. The Group has continued to
invest in its operating subsidiaries, building very strong management teams and
infrastructures that have accelerated revenue growth in the second half.
The investment required to build up the infrastructure and technology assets of
the group's underlying businesses resulted in an operating loss of (pound)16.8
million for the full year and an EPS loss of 9.6 pence before restructuring
costs and other exceptional items. This compares to a loss of 0.4 pence per
share for 1999. The Group expenses in full all costs associated with developing
new technologies across all its businesses.
Results for the year also include the operating results of the Information
Services Division sold to Thomson Corporation on 4th May 2000, and reflected
revenues of (pound)49.1 million and a loss on disposal of (pound)101.2 million.
The proceeds from the disposal were used to repay the Company's indebtedness in
its entirety such that no interest has been payable for the continuing
operations after May 2000 and the majority of interest receivable of
(pound)762,000 for the year arose after that date.
For the year ended 31st December 2000, the Board has reviewed the carrying value
of its fixed assets including goodwill and investments. Due to the significant
change in market conditions and sentiment towards early stage Internet
companies, the Board has prudently provided (pound)1.2 million against the
carrying value of its portfolio of minority investments. In addition, the Board
has also made an exceptional provision of (pound)3.8 million against the value
of goodwill associated with the Company's previous acquisition of WriteWorks Ltd
in November 1998.
The operating loss of continuing operations excluding exceptional items was
(pound)16.8 million for the year ending 31st December 2000, resulting in cash on
hand of (pound)16.3 million at the year end. The infrastructure required to
develop the continuing operations is largely in place and revenue growth is the
priority. However, each business has revenue plans against which the Board is
measuring progress and the Board is committed to taking whatever actions are
necessary to maintain costs in line with the achievement of those revenue
targets such that the Group as a whole continues to operate within its available
cash resources.
The Board of Bright Station plc believe that shareholder value will be maximised
by further investment in the operating businesses and consequently, as
previously indicated to shareholders, is not recommending the payment of a
dividend for 2000.
Operating Review
Bright Station consists of businesses that have carved out significant niches in
two of the largest and highest growth areas in the B2B Internet technology space
- - knowledge management/information retrieval and eCommerce.
Web Solutions Division (WSD)
WSD is focused on leveraging its proprietary content indexing technology,
MuscatStructure (previously InfoSort) and its proprietary natural language
search technology MuscatDiscovery. The Division consists of Smartlogik (the
knowledge management suite of solutions), WebTop/WebCheck (the concept-based web
search tool), and Bright Station Contracts (which manages a five year DTI
contract to provide an online information system for UK exporters). Q4 revenues
for the Division were (pound)1.9 m, 30% up on Q3 2000 and 80% up on Q4 1999.
Smartlogik
In the year to 2000 Smartlogik has made strong progress, increasing revenues in
the last quarter by 42% over Q3 2000 to (pound)1.4 million producing full year
revenues of (pound)4.1 million.
Stephen Hill, ex-MD of Inktomi, joined as CEO, and has further developed the
consultancy and sales infrastructure in the US, Europe and the UK. Smartlogik
now numbers 126 staff based in offices in Central London, on the East and West
coasts of the US, in Denmark and in an R&D facility in Cambridge. In December
2000 the senior management team was further strengthened by David Jefferies
C.B.E. who joined as Chairman.
Significant contract wins have included Yellow Pages, BAA, iVenturi and
Thomson's Institute of Scientific Information. Smartlogik now provides knowledge
management and Internet infrastructure solutions to over 100 major corporate
clients, including Electronic Telegraph, the DTI, BBC, Reuters, DHL, Fujitsu,
the FSA, AstraZeneca, Nokia, the Bank of England, Lafferty, National Maritime
Museum, the British Council and NASA amongst others.
WebTop
During 2000 WebTop launched the WebCheck personal desktop assistant (PDA) - a
revolutionary search tool that allows users to simply highlight text inside a
desktop document and with one mouse click find concept related information from
the Web. WebTop became the second most comprehensive search engine after Google,
with the indexation of over half a billion documents on the Web. In the year,
revenue and marketing agreements have been signed with beenz.com, Netscape
Communications Corp of the US in the Netherlands, MGON, the market-leading games
portal, Vigil Technologies, Inc., a US-based pioneer in online intelligence
solutions and ZDNet.
Bright Station Contracts
Bright Station Contracts (BSC) fulfils a five-year Department of Trade and
Industry contract to provide an online information system about UK exporters to
businesses, governments and British embassies around the world. BSC provides an
Internet portal for small to medium sized companies and now has over 17,000
registered exporter companies using the service.
ECommerce Division (ECD)
ECD contains OfficeShopper, our online business supplies operation, and Sparza,
which licenses eCommerce technologies. Q4 revenues for the Division were
(pound)0.8 million, 11% down on Q3 2000 and 38% up on Q4 1999.
OfficeShopper
Jeff Meers, who joined OfficeShopper as CEO in Q2 from IDG Global Solutions, has
built a high calibre team and relocated the OfficeShopper Head Office to
Chertsey (South West London) and opened a Regional Distribution Centre close to
Heathrow Airport. At the end of 2000 OfficeShopper had increased its customer
base from 400 corporate clients to over 900 and is now well positioned as a
leading UK online supplier of business products.
Sparza
In November Sparza completed the integration of boo.com's eCommerce software and
now offers a multi-currency, multi-lingual eCommerce hosting capability, linked
to fulfilment and logistics companies throughout Europe.
Sparza has been chosen as the exclusive solutions partner for a new 'e-tail
alliance' formed by Deutsche Post Fulfilment GmbH, Egremont and Lakewest
Consulting and Intel to provide a complete end-to-end solution for online
retailing and fulfilment.
Bright Station Ventures (BSV)
BSV was established to use the technology assets and commercial expertise within
the BSN group to invest cash and technology in new commercially viable
e-business opportunities. BSV has also provided an essential internal corporate
finance role to assist in the acquisition and fundraising activities of all the
Bright Station operating subsidiaries. Robert Lomnitz, Chief Executive of Bright
Station Ventures, joined the Board of Bright Station plc as an Executive
Director in December 2000.
Current Trading and Outlook
The new senior management now in place across the Company are focused on driving
forward their businesses, and the fourth quarter saw good progress towards
achieving many of Bright Station's business objectives. In 2000 the Group has
successfully carved out strong niche positions in two of the largest and highest
revenue generating areas in the B2B Internet technology space - knowledge
management/information retrieval and eCommerce.
Management's priority is to deploy the resources currently available to the
Company in such a way as to build the revenues in its businesses whilst
maintaining costs in line with those revenues. The Board also continues to
review options to ensure that additional capital is available for further
investment in the underlying businesses so that their potential is fully
exploited.
Since the year-end, significant and wide-ranging alliances with Intel and
Deutsche Post Fulfilment GmbH have been announced and important new client wins
have been achieved. The new business pipelines for all the Bright Station
businesses look strong.
- ENDS -
For further information please contact:
David Mattey +44 20 7930 6900
Chief Financial Officer
Bright Station plc
davidmattey@brightstation.com
- ------------------------------
John Olsen/Nick Lockwood +44 20 7357 9477
Hogarth Partnership
jolsen@hogarthpr.co.uk
- ----------------------
David Collins/Robert Rinderman 001 212 835 8500
Jaffoni & Collins
BSTN@jcir.com
- -------------
Bright Station plc
Consolidated Profit And Loss Account (unaudited)
For the 12 months ended 31st December 2000
Restated
------------------------------------------
Continuing Discontinued Continuing Discontinued
operations operations Total operations operations Total
2000 2000 2000 1999 1999 1999
(pound)000 (pound)000 (pound)000 (pound)000 (pound)000 (pound)000
Turnover 8,498 49,144 57,642 9,319 165,133 174,452
Cost of sales (2,044) (22,100) (24,144) (1,389) (66,785) (68,174)
----------- ------------ ----------- ----------- ------------ ------------
Gross profit 6,454 27,044 33,498 7,930 98,348 106,278
Distribution costs (2,646) (7,613) (10,259) (1,143) (20,974) (22,117)
Administrative expenses
Recurring (20,627) (15,789) (36,416) (7,595) (47,483) (55,078)
Exceptional provision for
diminution in value of
goodwill (3,827) - (3,827) - - -
Amortisation of development costs - (3,656) (3,656) - (9,142) (9,142)
----------- ------------ ----------- ----------- ------------ ------------
Operating (loss)/profit
Before exceptional items (16,819) (14) (16,833) (808) 20,749 19,941
Exceptional items (3,827) - (3,827) - - -
----------- ------------ ----------- ----------- ------------ ------------
Operating (loss)/profit
after exceptional items (20,646) (14) (20,660) (808) 20,749 19,941
Exceptional items
Loss on disposal of ISD - (101,187) (101,187) - - -
Loss on termination of
subsidiary - - - - (911) (911)
----------- ------------ ----------- ----------- ------------ ------------
(Loss)/profit on ordinary
activities after exceptional items (20,646) (101,201) (121,847) (808) 19,838 19,030
============ ============== =========== ============
Interest receivable 762 305
Amounts written off investments (1,200) (4,619)
Interest payable (6,659) (18,366)
----------- -------------
Loss on ordinary activities
before taxation (128,944) (3,650)
Taxation on loss on ordinary
activities (271) (1,478)
----------- -------------
Loss on ordinary activities
after taxation (129,215) (5,128)
Minority equity interests (37) (50)
----------- -------------
Retained loss (129,252) (5,178)
============= ==============
Loss per share (pence) (77.6) (3.4)
Continuing loss per share
excluding exceptional items
(pence) (9.6) (0.3)
Shares used in computing loss
per share (thousands) 166,573 151,929
Fully diluted loss per share
(pence) (77.5) (3.4)
Fully diluted continuing loss
per share excluding exceptional
items (pence) (9.6) (0.3)
Shares used in computing fully
diluted loss per share (thousands) 166,732 153,111
Bright Station plc
Consolidated Profit And Loss Account (unaudited)
For the 3 months ended 31st December 2000
Continuing Discontinued Continuing Discontinued Restated
operations operations Total operations operations Total
2000 2000 2000 1999 1999 1999
(pound)000 (pound)000 (pound)000 (pound)000 (pound)000 (pound)000
Turnover 2,714 - 2,714 1,739 35,228 36,967
Cost of sales (526) - (526) (308) (16,186) (16,494)
----------- ------------ ----------- ----------- ----------- -----------
Gross profit 2,188 - 2,188 1,431 19,042 20,473
Distribution costs (1,378) - (1,378) (329) (5,447) (5,776)
Administration expenses
including exceptional items
Recurring (7,580) - (7,580) (1,393) (13,427) (14,820)
Exceptional provision
for diminution in value
of goodwill (3,827) - (3,827) - - -
Amortisation of development
costs - - - - (2,521) (2,521)
----------- ------------ ----------- ----------- ----------- -----------
Operating loss
Before exceptional items (6,770) - (6,770) (291) (2,353) (2,644)
Exceptional items (3,827) - (3,827) - - -
----------- ------------ ----------- ----------- ----------- -----------
Operating loss after
exceptional items (10,597) - (10,597) (291) (2,353) (2,644)
Loss on disposal of ISD - (756) (756) - - -
----------- ------------ ----------- ----------- ----------- -----------
Loss on ordinary activities
after exceptional items (10,597) (756) (11,353) (291) (2,353) (2,644)
=========== ============ =========== ===========
Interest receivable 149 152
Amounts written off investments (1,319) (4,619)
Interest payable - (4,694)
----------- ------------
Loss on ordinary activities
before taxation (12,523) (11,805)
Taxation on loss on ordinary
activities - (328)
----------- ------------
Loss on ordinary activities
after taxation (12,523) (12,133)
Minority equity interests - (59)
----------- ------------
Retained loss (12,523) (12,192)
============= =============
Loss per share (pence) (7.3) (8.0)
Continuing loss per share
excluding exceptional items
(pence) (3.8) (0.1)
Shares used in computing loss
per share (thousands) 172,615 152,865
Fully diluted loss per share
(pence) (7.3) (8.0)
Fully diluted continuing loss
per share excluding exceptional
items (pence) (3.8) (0.1)
Shares used in computing fully
diluted loss per share (thousands) 172,622 153,034
Bright Station plc
Consolidated Balance Sheet (unaudited)
As at 31st December 2000
Restated
----------------
31 December 31 December
2000 1999
(pound)000 (pound)000
FIXED ASSETS
Intangible assets 295 25,754
Goodwill 2,621 9,805
Tangible assets 2,398 14,338
Investments 1,344 9,635
-------------- ----------------
6,658 59,532
-------------- ----------------
CURRENT ASSETS
Stocks - 60
Debtors 3,310 36,690
Cash at bank and in hand 16,334 10,521
-------------- ----------------
19,644 47,271
CREDITORS (amounts falling due within one year) (7,354) (71,574)
-------------- ----------------
NET CURRENT ASSETS/(LIABILITIES) 12,290 (24,303)
-------------- ----------------
TOTAL ASSETS LESS CURRENT LIABILITIES 18,948 35,229
CREDITORS (amounts falling due after more than
one year) (17) (137,370)
Provision for liabilities and charges - (1,430)
-------------- ----------------
18,931 (103,571)
================= ==================
CAPITAL AND RESERVES
Called up share capital 1,726 1,549
Share premium account 184,057 154,949
Shares to be issued 134 967
Profit and loss account (166,986) (261,579)
-------------- ----------------
Ordinary shareholders' funds 18,931 (104,114)
Minority interest - 543
-------------- ----------------
Total shareholders' funds 18,931 (103,571)
================= ==================
Bright Station plc
Consolidated Cash Flow Statement (unaudited)
For the 12 months ended 31st December 2000
Restated
-------------- -------------------
2000 1999
(pound)000 (pound)000
NET CASH (OUTFLOW)/INFLOW FROM OPERATING ACTIVITIES (11,266) 33,502
-------------- -------------------
RETURNS ON INVESTMENTS AND SERVICING OF FINANCE
Interest received 782 303
Interest paid on bank loans and overdrafts (7,798) (16,945)
Interest paid on finance leases (25) (106)
-------------- -------------------
(7,041) (16,748)
-------------- -------------------
TAXATION PAID (248) (911)
-------------- -------------------
CAPITAL EXPENDITURE
Payments to acquire intangible assets (2,896) (12,097)
Payments to acquire tangible fixed assets (2,747) (4,536)
Payments to acquire fixed asset investments (1,824) -
Receipts from sales of tangible fixed assets 99 78
-------------- -------------------
(7,368) (16,555)
-------------- -------------------
ACQUISITIONS AND DISPOSALS
Purchase of subsidiary undertakings (257) (1,235)
Proceeds from sale of investments 2,537 777
Payment to acquire minority interest in subsidiary
undertaking - (428)
Expenses in connection with purchase of subsidiary
undertaking - (303)
Cash transferred with sale of ISD (4,813) -
Payment of deferred consideration (1,430) -
Expenses in connection with sale of ISD (4,910) -
Proceeds from sale of ISD 185,474 -
-------------- -------------------
176,601 (1,189)
-------------- -------------------
CASH INFLOW/(OUTFLOW) BEFORE THE USE OF LIQUID RESOURCES
AND FINANCING 150,678 (1,901)
-------------- -------------------
FINANCING
Net proceeds on issue of Ordinary share capital 28,299 142
Debt due within one year
- - Increase in borrowings - 28,780
- - Increase in finance leases - 1,549
- - Repayment of loans (172,522) (22,004)
Debt due after one year
- - Increase in lease finance - 1,509
Expenses on raising of debt - (1,246)
Repayment of capital element of finance leases (642) (525)
-------------- -------------------
(144,865) 8,205
-------------- -------------------
INCREASE IN CASH 5,813 6,304
================== ========================
RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET
FUNDS/(DEBT)
Increase in cash in the period 5,813 6,304
Cash used to decrease lease financing 642 525
Cash acquired from issue of debt (net of expenses) - (27,533)
Cash used to repay loans 172,522 22,004
Cash acquired from new finance leases - (3,058)
-------------- -------------------
Change in net funds/(debt) from cash flows 178,977 (1,758)
Other non-cash changes (6,125) (1,274)
New finance leases 37 (3,614)
Finance lease obligations transferred to ISD 5,724 -
Effect of foreign exchange rate changes (5,300) (5,242)
-------------- -------------------
Movement in net funds/(debt) in period 173,313 (11,888)
Net debt at beginning of period (156,979) (145,091)
-------------- -------------------
Net funds/(debt) at end of period 16,334 (156,979)
================== ========================
Bright Station plc
Analysis of Revenues
For the 12 months ended 31st December 2000 (unaudited)
Restated
1999 2000
Qtr 1 Qtr 2 Qtr 3 Qtr 4 Total Qtr 1 Qtr 2 Qtr 3 Qtr 4 Total
(pound)000 (pound)000 (pound)000 (pound)000 (pound)000 (pound)000 (pound)000 (pound)000 (pound)000 (pound)000
ISD - discontinued
operations 41,412 39,400 48,989 35,332 165,133 38,363 10,781 - - 49,144
WSD - continuing
operations 965 4,839(1) 1,038 1,075 7,917 1,102 1,413 1,493 1,939 5,947
ECD - continuing
operations 305 322 215 560 1,402 388 513 875 775 2,551
---------------------------------------------------- ----------------------------------------------------
Total continuing
operations 1,270 5,161 1,253 1,635 9,319 1,490 1,926 2,368 2,714 8,498
---------------------------------------------------- ----------------------------------------------------
Total revenues 42,682 44,561 50,242 36,967 174,452 39,853 12,707 2,368 2,714 57,642
==================================================== ====================================================
(1) Includes (pound)4.0 million in respect of licence fee from Fujitsu
These results are unaudited and do not constitute statutory accounts within the
meaning of Section 240 of the Companies Act 1985. The financial statements for
the year ended 31st December 1999 have been audited by the Company's auditors,
PricewaterhouseCoopers, and delivered to the Registrar of Companies. The audit
report was not qualified and neither did it contain any statements under Section
237 (2) or (3) of the Companies Act 1985. With the exception of the change in
accounting policy for capitalised development costs and the restatement of
software licensing revenues (see interim statement), the unaudited results for
the twelve months ended 31st December 2000 have been prepared in accordance with
the accounting policies stated in the 1999 Annual Report and Accounts.