EXHBIT 99.1
[Persistence letterhead]
PERSISTENCE SOFTWARE ANNOUNCES
THIRD QUARTER FINANCIAL RESULTS
SAN MATEO, CALIF. -- OCTOBER 17, 2003 -- Persistence(R) Software
(NASDAQ: PRSW), a leading provider of data services software for distributed
data access and management, today announced financial results for the third
quarter ended September 30, 2003.
For the quarter, revenues were $1,806,000 compared with $2,876,000 for
the second quarter of 2003. The Company reported a net loss of $1,213,000, or
$(0.50) per share compared with a net loss of $624,000 or $(0.26) per share for
the second quarter of 2003. Revenues for the third quarter of 2002 were
$4,144,000 with a net loss of $449,000 or $(0.22) per share.
Cash balances at September 30, 2003 were $5.1 million compared to $6.2
million as of June 30, 2003 and $6.8 million as of September 30, 2002.
Christopher Keene, chief executive officer of Persistence, commented,
"While market conditions remain challenging, in this past quarter we have seen
an increase in pilot programs and an increase in customer inquiries that we
believe can set the stage for new pilots. Our pilot programs provide prospective
clients the ability to experience first-hand the benefits of Persistence
technology and improve our ability to complete sales."
Mr. Keene continued, "During the quarter we initiated a strategic
partnership with Shanghai Data Solutions that we expect will introduce our
technology into the large and diverse Chinese market. We are very excited at the
opportunities that this relationship will make possible for both parties in
developing this large potential new market. Also during the third quarter we
introduced EdgeXtend Enterprise Developer to increase developer productivity
when managing complex application data. Persistence continues to develop
products that are designed to meet the mission-critical needs of leading-edge
institutions in a wide variety of industry segments."
The Company will discuss these results in a conference call scheduled
for 4:15 p.m. Eastern October 17, 2003. Interested parties can access the call
by dialing (877) 858-9308 or by accessing the webcast at
http://www.persistence.com/company/ir.php. A replay of the call will be
available at (706) 645-9291, access number 3196579, for 3 days following the
call; and the webcast can be accessed at
http://www.persistence.com/company/ir.php for 30 days.
The Company also announced that Ms. Christine Russell has tendered her
resignation as chief financial officer of Persistence effective October 20,
2003. Ms. Russell will be leaving Persistence to assume a financial executive
position at a publicly-traded technology company in the Silicon Valley. Mr.
Brian Tobin, who was the corporate controller of Persistence, has been appointed
the acting chief financial officer.
"We thank Christine Russell for her professionalism, industry expertise
and tireless efforts on behalf of Persistence" said Mr. Keene. "Some people have
the ability to make everyone around them even better at what they do, and Chris
had that kind of an impact on all of us at Persistence. We wish her the very
best in her new position and in all her future endeavors."
ABOUT PERSISTENCE
Founded in 1991, Persistence is a publicly traded company (NASDAQ:
PRSW). Persistence Software provides innovative software tools to manage
application data for mission-critical systems with stringent response times.
Since 1991, Persistence products have helped over 100 data-intensive companies
achieve breakthrough application performance, scalability and developer
productivity, including Adobe Systems, Applied Biosystems, Citigroup, FedEx,
Fiducia AG, Motorola, Prebon Yamane and Sabre.
Persistence has pioneered application data management technologies for
object-relational mapping, clustered object caching and cache synchronization.
Sun, Cisco and Sybase have licensed patented Persistence technology.
Traditional IT architectures depend on distributed databases and
unstructured messaging to keep global business data synchronized. These
traditional architectures are increasingly unable to meet business requirements
for mission-critical applications, including complex data, fast response times
and geographic distribution. Persistence Software enables a new approach to
managing data for mission-critical applications, called a Data Services
Architecture. The core concept is to create a single, consistent software layer
for managing data access and distribution. This architecture is designed to
eliminate data errors and delays, while also reducing development time and
costs.
Except for the historical information contained herein, the matters discussed in
this press release are forward-looking statements involving risks and
uncertainties, which could cause actual results to differ materially from those
in such forward-looking statements. Potential risks and uncertainties include,
but are not limited to, Persistence Software's limited operating history,
potential fluctuations in our operating results, our potential need to raise
cash in the future, uncertainties related to our long sales cycle, our reliance
on a relatively small number of customers, our dependence on the Java
programming language and the Enterprise JavaBeans standard becoming widely
accepted standards, failure to manage our resources or attract and retain the
services of key employees, our need to deliver products that are free of defects
and errors and meet rapidly changing technology standards and customer
requirements, our need to build a strong direct sales team and develop third
party sales channels, our dependence on enterprise-wide system deployments, and
our need to address competition from companies with substantially greater
resources. Further information regarding these and other risks and uncertainties
is included in our Annual Report on Form 10-K for the year ended December 31,
2002, the Form 10Q for the quarters ended March 31, 2003 and June 30, 2003 and
in our other filings with the Securities and Exchange Commission.
-Financial tables follow-
PERSISTENCE SOFTWARE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per share amounts)
THREE MONTHS ENDED NINE MONTHS ENDED
SEP. 30, SEP. 30, SEP. 30, SEP. 30,
2003 2002 2003 2002
--------- --------- --------- ---------
Revenues:
Licenses $ 722 $ 2,825 $ 3,672 $ 7,762
Service 1,084 1,319 3,533 4,273
--------- --------- --------- ---------
Total revenues 1,806 4,144 7,205 12,035
--------- --------- --------- ---------
Cost of revenues:
Licenses 25 75 86 177
Service 395 691 1,331 2,218
--------- --------- --------- ---------
Total cost of revenues 420 766 1,417 2,395
--------- --------- --------- ---------
Gross profit 1,386 3,378 5,788 9,640
--------- --------- --------- ---------
Operating expenses:
Sales and marketing 1,228 1,848 4,304 6,868
Research and development 732 1,040 2,384 3,196
General and administrative 631 798 1,931 2,644
Amortization of purchased intangibles -- 126 -- 480
--------- --------- --------- ---------
Total operating expenses 2,591 3,812 8,619 13,188
--------- --------- --------- ---------
Income / (Loss) from operations (1,205) (434) (2,831) (3,548)
Interest and other income, net (4) (7) 9 75
Income taxes (4) (8) (23) (70)
--------- --------- --------- ---------
Net income / (loss) $ (1,213) $ (449) $ (2,845) $ (3,543)
========= ========= ========= =========
Basic net profit / (loss) per share $ (0.50) $ (0.22) $ (1.18) $ (1.76)
========= ========= ========= =========
Shares used in calculating basic net
profit / (loss) per share 2,409 2,020 2,406 2,014
========= ========= ========= =========
PERSISTENCE SOFTWARE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands)
AS OF
SEP. 30, DEC. 31,
2003 2002
--------- ---------
Assets:
Current assets:
Cash, cash equivalents $ 5,091 $ 8,903
Accounts receivable, net 1,600 1,252
Prepaids and other current assets 383 392
--------- ---------
Total current assets 7,074 10,547
Property and equipment, net 134 375
Purchased intangibles, net 69 123
Deposits and other assets 53 55
--------- ---------
Total assets $ 7,330 $ 11,100
========= =========
Liabilities and Stockholders' Equity:
Current liabilities:
Accounts payable $ 328 $ 325
Accrued liabilities 1,865 1,910
Deferred revenues (net of long term portion) 2,395 2,529
Current portion of long-term obligations 628 841
--------- ---------
Total current liabilities 5,216 5,605
Long-term liabilities
Long-term portion of deferred revenues 224 691
Long-term obligations 25 93
--------- ---------
Total long-term liabilities 249 784
--------- ---------
Total liabilities 5,465 6,389
--------- ---------
Stockholders' equity:
Common stock, net 66,083 66,072
Accumulated deficit (64,216) (61,370)
Other (2) 9
--------- ---------
Total stockholders' equity 1,865 4,711
--------- ---------
Total liabilities and stockholders' equity $ 7,330 $ 11,100
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