EXHIBIT 99.1
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DATAWATCH ANNOUNCES SECOND FISCAL QUARTER RESULTS
DROP IN MARCH SALES SPOILS THE PROFIT RUN
LOWELL, MA - APRIL 23, 2003 -- Datawatch Corporation (NASDAQ: DWCH), a leading
provider of enterprise reporting, infrastructure and IT support solutions, today
announced results for its second fiscal quarter.
Revenues from continuing operations for the quarter ended March 31,
2003 were $4,108,000 down 15% from $4,812,000 in the same period of fiscal 2002.
Net loss from continuing operations for the second fiscal 2003 quarter was
$50,000, or $0.02 per diluted share, compared to net income of $237,000, or
$0.09 per diluted share, a year ago.
Revenues from continuing operations for the six months ended March 31,
2003 were $8,610,000 down 9% from $9,413,000 in the same period of fiscal 2002.
Net loss from continuing operations for the first six months of fiscal 2003 was
$33,000, or $0.01 per diluted share, compared to net income of $346,000, or
$0.13 per diluted share, a year ago.
Commenting on the quarter's results, president and CEO Robert Hagger
said, "The slow spending environment that we experienced in March caused our
first quarterly loss since September 2001. Enterprise sales held up well due to
the longer lead-time of decision-making, but Desktop & Server products suffered
badly during the month of March.
On the good news side, we are off to a good start in April as sales
pipelines increased. This gives us confidence that our products are being well
received in the market place. Although it was difficult to close deals this
quarter, we're taking the longer-term view, and are structured to do well as we
come out of this current economic cycle.
Our flagship Enterprise Reporting Solution, Datawatch ES 4.0, was
released in February, featuring a 100% web-based interface, industry-leading
Microsoft Excel support and new XML-based forms technology. Datawatch ES 4.0 is
the next generation of business intelligence enterprise reporting.
We also had new product releases for our Service Management product
suites VHD-Online and QSM in the quarter, and we expect these upgrades to
provide new revenue streams in fiscal 2003.
We are hosting our User Conference in Las Vegas from May 18-21 where we
will be presenting the latest Monarch and XML technologies as well as running
user workshops and product training. Customers, prospects and investors alike
are welcome to the show, but please book early".
Datawatch previously announced that the company will present and
discuss its second quarter and year to date results on April 24th at 12 p.m.
(ET) in a live conference call broadcast via the Internet at
http://www.vcall.com/EventPage.asp?ID=83603. Listeners are recommended to go to
the website at least 15 minutes early to register and download any necessary
audio software. An archived replay of the broadcast will be available for 30
days at the same location.
ABOUT DATAWATCH CORPORATION
Datawatch Corporation is a leader in enterprise reporting, infrastructure, and
IT support solutions that help organizations increase productivity, reduce costs
and gain competitive advantage. Datawatch products are used in more than 20,000
companies, institutions and government agencies worldwide.
Datawatch works with VARs, integrators, consultants and independent
software vendors who sell and support Datawatch products. In addition, Datawatch
works with OEM customers who embed Datawatch components and technologies in
their own solutions. The corporate address for Datawatch is 175 Cabot Street,
Suite 503, Lowell, MA 01854-3633; telephone (978) 441-2200. News, shareholder
information and other corporate information may be found on the company's web
site at www.datawatch.com.
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
Any statements contained in this press release that do not describe historical
facts may constitute forward-looking statements as that term is defined in the
Private Securities Litigation Reform Act of 1995. Any such statements contained
herein are based on current expectations, but are subject to a number of risks
and uncertainties that may cause actual results to differ materially from
expectations. The factors that could cause actual future results to differ
materially from current expectations include the following: Datawatch's ability
to successfully integrate its recent acquisition of Auxilor Inc.; risks
associated with the uncertainty of the current economic climate; risks
associated with fluctuations in quarterly operating results; Datawatch's
dependence on its principal products; risks associated with international sales;
risks associated with distributor sales; an unfavorable result in any
litigation; market acceptance of the new products; dependence on the
introduction of new products and possible delays in those introductions. Further
information on factors that could cause actual results to differ from those
anticipated is detailed in various publicly-available documents, which include,
but are not limited to, filings made by Datawatch from time to time with the
Securities and Exchange Commission, including but not limited to, those
appearing in Datawatch's Form 10-K for the year ended September 30, 2002. Any
forward-looking statements should be considered in light of those factors.
# # # #
Datawatch Contact:
Alan R. MacDougall, Vice President of Finance & CFO
amacdougall@datawatch.com
Phone (978)441-2200, ext. 8207; Fax: (978)441-1114; www.datawatch.com
DATAWATCH CORPORATION AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
Amounts in Thousands (except per share data)
Three Months Ended Six Months Ended
-------------------------- --------------------------
03/31/03 03/31/02 03/31/03 03/31/02
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Revenue:
Software licenses .......................... $ 2,627 $ 3,396 $ 5,920 $ 6,663
Maintenance and services ................... 1,481 1,416 2,690 2,750
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Total Revenue .................................. 4,108 4,812 8,610 9,413
Costs and expenses:
Cost of software licenses .................. 578 712 1,145 1,444
Cost of maintenance and services ........... 616 746 1,230 1,416
Sales and marketing expenses ............... 1,438 1,591 2,962 3,115
Product development expenses ............... 473 338 815 661
General and administration expenses ........ 1,057 1,076 2,308 2,275
Restructuring costs ........................ -- 88 182 88
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Income (loss) from operations .................. (54) 261 (32) 414
Other income (expense) ......................... 4 (24) (1) (68)
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Income (loss) from continuing operations ....... $ (50) $ 237 $ (33) $ 346
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Discontinued operations:
Gain on sale of Guildsoft, net ............. -- -- -- 17
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Income (loss) from discontinued operations ..... $ -- $ -- $ -- $ 17
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Net income (loss) .............................. $ (50) $ 237 $ (33) $ 363
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Net Income (Loss) Per Share - Basic and Diluted:
Continuing operations - Basic .............. ($0.02) $ 0.09 ($0.01) $ 0.14
Continuing operations - Diluted ............ ($0.02) $ 0.09 ($0.01) $ 0.13
Discontinued operations - Basic & Diluted .. -- -- -- $ 0.01
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Net Income (Loss) Per Share - Basic ............ ($0.02) $ 0.09 ($0.01) $ 0.14
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Net Income (Loss) Per Share - Diluted .......... ($0.02) $ 0.09 ($0.01) $ 0.14
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DATAWATCH CORPORATION AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
Amounts in Thousands
March 31, September 30,
2003 2002
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ASSETS:
Cash and investments ....................... $ 3,041 $ 3,605
Accounts receivable, net ................... 3,392 3,057
Inventories ................................ 126 171
Prepaid expenses ........................... 598 571
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Total Current Assets ........................... 7,157 7,404
Property and equipment, net .................... 555 732
Other assets ................................... 1,507 1,318
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Total Assets ................................... $ 9,219 $ 9,454
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LIABILITIES AND STOCKHOLDERS' EQUITY:
Accounts payable and accrued expenses ...... $ 2,538 $ 3,153
Deferred revenue ........................... 2,584 2,228
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Total Current Liabilities ...................... 5,122 5,381
Accrued Severance, less current portion ........ 8 13
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Total Liabilities .............................. 5,130 5,394
Stockholders' equity ........................... 4,089 4,060
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Total Liabilities and Stockholders' Equity ..... $ 9,219 $ 9,454
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