EXHIBIT 99.1
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Semotus Solutions Inc. (ticker: DLK,
exchange: AMEX)
7/1/2003
[SEMOTUS SOLUTIONS LOGO]
SEMOTUS SOLUTIONS ANNOUNCES ANNUAL RESULTS FOR FISCAL YEAR ENDED
MARCH 31st, 2003
SEMOTUS REPORTS REDUCED NET LOSS, IMPROVED MARGINS AND LOWER BURN RATE
SAN JOSE, CA.-- (PrimeZone Media) July 1, 2003, 06:00 AM EST -- Semotus
Solutions (AMEX:DLK), a leading provider of software for mobile enterprise
applications, yesterday filed its annual report on Form 10K and is today
announcing its financial results for the fiscal year ended March 31, 2003.
Semotus reported a reduction in its net loss to $3.4 million or $0.19 per share
in the fiscal year ended March 31, 2003 from $18.4 million or $1.09 per share in
the fiscal year ended March 31, 2002. Semotus also reduced its use of cash by
36% to $2.1 million from $3.3 million in the fiscal year ended March 31, 2003
versus 2002. Semotus' operating performance improved, as evidenced by a
continued increase in its gross profit margin to 60% for the fiscal year ended
March 31, 2003 from 53% for the fiscal year ended March 31, 2002. Revenues
declined 7% to $2.3 million from $2.5 million in the fiscal year ended March 31,
2003 versus 2002. For comparison purposes, the results of the operations in
fiscal year 2002 included significant impairment charges of $7.0 million for
certain intangible assets and goodwill.
In accordance with the recently released SFAS 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets", the financial results in this 10-K
have been reclassified to reflect the discontinued operations of three
subsidiaries, Five Star Advantage, Inc., Wares on the Web, Inc. and Application
Design Associates, Inc. ("ADA"). This does not impact the previously reported
net loss or net loss per share. Accordingly, these three subsidiaries are
classified as discontinued in the financial results in this 10-K. The operations
of Five Star and Wares were closed down in the fiscal year 2003, while the
operations of ADA were sold to the Global Beverage Group, effective May 6, 2003.
"The fiscal year ended March 31, 2003 has demonstrated the improving financial
trend at Semotus by reducing operating losses and the cash burn at the Company.
Although revenues have also slightly declined, the significant across-the-board
cost reductions and consolidations have allowed the Company to have better
overall operating performance and efficiency," said Charley Dargan, Semotus
Solutions CFO.
Mr. Anthony LaPine, Semotus' CEO and Chairman of the Board, provided the
following summary:
YEAR IN REVIEW
"The last twelve months have been a time of transition for Semotus as we
sharpened our focus on our core competence of providing Enterprise Mobility
Software and Services. We reinvigorated our two core product lines, Wireless
Financial Data and Wireless Communications, by introducing a powerful array of
next-generation products. Equally important, we substantially restructured the
Company by centralizing operations and divesting Semotus of businesses that were
not tightly focused on our core competencies. In addition, our buyback of Brown
Simpson's $5.7 million preferred stock position simplified our equity structure
and benefited the common shareholders.
These sweeping changes have laid a strong foundation for growth and
profitability, and we believe these actions have positioned the Company to take
advantage of the anticipated economic turn around," stated Mr. LaPine, CEO of
Semotus Solutions.
CENTRALIZATION AND CONSOLIDATION
"Since the downturn of the economy almost three years ago, Semotus has
aggressively centralized and consolidated its operations. We significantly
downsized our Simkin and Wizshop operations and sold our ADA subsidiary. Semotus
fully integrated its Cross (HiplinkXS) acquisition while closing down our Five
Star and Wares On The Web e-commerce operations. Further, Semotus aggressively
cut its facility and overhead costs by securing less expense space, cutting
staff, and instituting a 10% pay cut for management. These actions have resulted
in significant reduction in our loss per share, a meaningful increase in our
gross margins, and a substantial decrease in our cash burn rate," commented Mr.
LaPine. "As a consequence of these actions, it is anticipated that our cash
position is sufficient to support our operations for the current fiscal year."
A NEW GENERATION OF PRODUCT LEADERSHIP
"Semotus has rolled out a number of new products around its two core lines of
business: (1) Wireless Financial Data which now includes Equity Market Pro and
Futures Market Pro to complement our Global Market Pro product, and (2) Wireless
Communication's HiplinkXS product family which now includes IQLINKXS, REMLINKXS,
OPENLINKXS, and QUICKLINKXS," said Mr. LaPine. "We are committed to constant
innovation and our tireless R&D efforts ensure that Semotus will remain a
leading provider of Enterprise Mobility Software and Services. We are proud of
our Fortune 1000 customer base including, among others, this years addition of
The United Nations and Chicago O'Hare Airport. In addition, we expect a
substantial contribution from our recent agreement with Reuters, wherein their
sales organization will be co-selling our Wireless Financial Data products."
MOVING FORWARD
"In summary, the past twelve months have been a period during which we made many
important and fundamental changes at Semotus. While many of these changes were
difficult and painful, I believe they were absolutely necessary to put the
Company back on the path to profitability and provide lasting value for our
shareholders," continued Mr. LaPine. "I firmly believe we're on track to reach
that goal, and I thank all of our shareholders, customers, partners and
employees for their patience and support."
ABOUT SEMOTUS SOLUTIONS
Founded in 1993, Semotus Solutions (AMEX:DLK) is a premier provider of software
for the mobile enterprise connecting employees to critical business systems,
information and processes. With a Fortune 1000 installed base and more than 600
corporate customers including Lockheed Martin, Blue Cross Blue Shield,
Coca-Cola, Hewlett Packard, Nextel Communications, JP Morgan-Chase, and The
United Nations, Semotus Solutions' software provides mobility, convenience,
efficiency and profitability in the areas of workforce automation, finance,
healthcare, and m-commerce. Semotus Solutions is proud to be included in the
Deloitte & Touche 2002 "Technology Fast 500" list of companies. www.semotus.com
SEMOTUS SOLUTIONS
MEDIA CONTACT
STEPHANIE JANARD, 303-708-1159
Marketing Manager
sjanard@semotus.com
SEMOTUS SOLUTIONS
INVESTOR RELATIONS CONTACT
TALI DURANT, 408-358-7100
Corporate Counsel
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This press release contains forward-looking statements, which are made pursuant
to the Safe-Harbor provisions of the Private Securities Litigation Reform Act of
1995. Words such as ``intends, ``believes and similar expressions reflecting
something other than historical fact are intended to identify forward-looking
statements, but are not the exclusive means of identifying such statements.
These forward-looking statements involve a number of risks and uncertainties,
including the timely development and market acceptance of products and
technologies, successful integration of acquisitions, the ability to secure
additional sources of finance, the ability to reduce operating expenses, and
other factors described in the Company's filings with the Securities and
Exchange Commission. The actual results that the Company achieves may differ
materially from any forward-looking statement due to such risks and
uncertainties. The Company undertakes no obligation to revise or update any
forward-looking statements in order to reflect events or circumstances that may
arise after the date of this release.