PRESS RELEASE
FOR IMMEDIATE RELEASE
For further information, contact:
Gary Arnold Fletcher Chamberlin
Chairman, President and C.E.O. Investor Relations
Analogy, Inc. Harris Massey Herinckx
(503) 626-9700 (503) 295-1922
ANALOGY REPORTS FISCAL FIRST QUARTER RESULTS
Beaverton, Oregon -- July 23, 1998 -- Analogy, Inc. (NASDAQ:ANLG) today
announced its financial results for the first fiscal quarter ended June 30,
1998. As previously announced, the Company reported an operating loss for the
quarter in addition to one-time restructuring charges.
Total revenue for the first quarter of fiscal 1999 was $5,412,000, an increase
of 4% over the total for the first quarter of fiscal 1998 of $5,212,000.
Product license revenue increased 3% to $2,834,000, and service and other
revenue increased 5% to $2,578,000. The net loss in the fiscal 1999 first
quarter was $3,155,000 or $0.34 per share, compared with a net loss of $943,000
or $0.10 per share in the first quarter a year ago. The fiscal 1999 first
quarter includes restructuring charges of $557,000 as result of the Company's
employment and expense reductions that were announced in June 1998.
"These results were expected, but they are still well below what we believe is
the long-run capability for the Company," said Gary Arnold, chairman and
president of Analogy. "The first quarter has generally been our weakest quarter
of the year, and we do expect our quarterly revenues to improve as we go through
the remainder of the fiscal year. After our disappointing fourth quarter last
year, we have reduced our headcount and expenses to match our expectations for
the coming year. We expect those reductions and the improving revenue prospects
to return the Company to quarterly profitability later in this fiscal year."
The Company's expectations regarding future revenues and profitability stated
above are forward-looking statements which are made pursuant to the safe harbor
provisions of the Private Securities Litigation Act of 1995. The
forward-looking statements involve risks and uncertainties that could cause
actual results to differ materially from the forward-looking statements,
including, without limitation, the receipt and timing of orders for the
Company's products, the timing of sell-through by resellers, the lengthy sales
cycles for the Company's products, the effect of the Asian economic situation,
the impact of expense reductions on the Company, increased adoption of
behavioral modeling design methodologies for mixed-signal and mixed-technology
systems design, Analogy's ongoing ability to introduce new products and expand
its markets, seasonal fluctuations in the Analogy's order patterns and
competitive initiatives. The forward-looking statements should be considered in
light of these risks and uncertainties.
Analogy Inc., founded in January 1985, develops and markets high performance
software and model libraries for top-down design and behavioral simulation of
mixed-signal and mixed-technology systems.
(tables follow)
ANALOGY, INC.
Consolidated Income Statement
(000, except per share data)
(unaudited)
Quarter Ended
6/30/98 6/30/97
Product license revenue $ 2,834 $ 2,751
Service and other revenue 2,578 2,461
Total revenue 5,412 5,212
Cost of product license revenue 520 551
Cost of service and other revenue 334 584
Total cost of revenue 854 1,135
Gross profit 4,558 4,077
Research and development 2,396 1,511
Sales and marketing 3,604 3,088
General and administrative 684 668
Amortization of intangibles 92 92
Restructuring charges 557 -
Total operating expenses 7,333 5,359
Operating loss (2,775) (1,282)
Other income (expense), net (202) 25
Loss before income tax (2,977) (1,257)
Income tax expense (benefit) 178 (314)
Net loss $ (3,155) $ (943)
Net loss per share
Basic $ (0.34) $ (0.10)
Diluted $ (0.34) $ (0.10)
Weighted average shares outstanding
Basic 9,358 9,127
Diluted 9,358 9,127
ANALOGY, INC.
Consolidated Balance Sheet
(unadited)
(000)
6/30/98 3/31/98
Cash and cash equivalents $ 3,202 $ 8,130
Accounts receivable, net 4,506 3,946
Prepaid expenses 1,140 1,160
Other assets 1,608 1,394
Total current assets 10,456 14,630
Furniture, fixtures and equipment, net 3,544 3,811
Library costs, net 4,091 3,924
Other assets, net 560 610
Total assets $ 18,651 $ 22,975
Accounts payable and accrued expenses 1,580 1,895
Current portion of capital leases 401 536
Accrued salaries and benefits 2,164 2,726
Unearned revenue 8,176 8,562
Total current liabilities 12,321 13,719
Non-current portion of capital leases 508 454
Other liabilities 98 107
Total long-term liabilities 606 561
Common stock 18,081 17,906
Foreign currency translation (196) (205)
Accumulated deficit (12,161) (9,006)
Total shareholders' equity 5,724 8,695
Total liabilities and equity $ 18,651 $ 22,975