EXHIBIT 99.1
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DATAWATCH CORPORATION REPORTS SECOND QUARTER EARNINGS
DATAWATCH ANNOUNCES Q2 REVENUE GROWTH OF 26%
AND YEAR-TO-DATE REVENUE GROWTH OF 12%
LOWELL, MA - APRIL 22, 2004 -- Datawatch Corporation (NASDAQ: DWCH), a leading
provider of business intelligence, data transformation and IT support solutions,
today announced results for its second fiscal quarter.
Revenues for the quarter ended March 31, 2004 were $5,195,000, an increase
of 26% from $4,108,000 in the same period of fiscal 2003. Net income for the
second fiscal 2004 quarter was $396,000, or $0.07 per diluted share, compared to
a net loss of $50,000, or $0.01 per diluted share, a year ago.
Revenues for the six months ended March 31, 2004 were $9,602,000, an
increase of 12% from $8,610,000 in the same period of fiscal 2003. Net income
for the first six months of fiscal 2004 was $719,000, or $0.13 per diluted
share, compared to a net loss of $33,000, or $0.01 per diluted share, a year
ago.
Commenting on the second quarter's results, president and CEO Robert Hagger
said, "We are very pleased with our revenue growth, with both license and
services revenues up from last year for both the quarter and year-to-date. We
have been diligently working through our plan, which was to continue to improve
our profitability and cash position. The quarter and half-year results were
solidly profitable and our cash position increased by $1 million for the six
months and by more than $3 million since March 31, 2003. At the same time we
have invested resources to improve the market awareness of our products and
expand our sales force, with sales and marketing expenses increasing by more
than $400,000 in the second quarter when compared to the previous quarter.
We are also continuing to invest in research and development to extend the
functionality of our existing solutions and to create new products. Our recently
announced Datawatch|ES TotalView module will provide our users with the means to
easily access and join data from disparate systems into new reports. This
increased functionality broadens the potential customer base for Datawatch|ES
and demonstrates our ongoing commitment to helping our customers improve the
productivity of information users in the workplace."
Datawatch previously announced that the company will present and discuss
its second quarter results today at 2 p.m. (EDT) in a live conference call
broadcast via the Internet at http://www.vcall.com/ClientPage.asp?ID=87726.
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
Datawatch Corporation is a leader in business intelligence, data transformation,
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; 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: 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 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 the Company's Form
10-K for the year ended September 30, 2003 and Form 10-Q for the quarter ended
December 31, 2003. Any forward-looking statements should be considered in light
of those factors.
# # # #
Datawatch Contact:
Larry Bouchie, (978) 275-8264
larry_bouchie@datawatch.com
DATAWATCH CORPORATION AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
Amounts in Thousands (except per share data)
QUARTER ENDED QUARTER ENDED SIX MONTHS ENDED SIX MONTHS ENDED
MARCH 31, 2004 MARCH 31, 2003 MARCH 31, 2004 MARCH 31, 2003
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Revenue:
Software licenses ....................... $ 3,480 $ 2,627 $ 6,431 $ 5,920
Maintenance and services ................ 1,715 1,481 3,171 2,690
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Total Revenue ............................... 5,195 4,108 9,602 8,610
Costs and expenses:
Cost of software licenses ............... 760 577 1,390 1,145
Cost of maintenance and services ........ 661 616 1,273 1,230
Sales and marketing expenses ............ 1,955 1,438 3,494 2,962
Product development expenses ............ 342 473 621 815
General and administration expenses ..... 1,067 1,058 2,103 2,308
Restructuring costs ..................... -- -- -- 182
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Income (loss) from operations ............... 410 (54) 721 (32)
Other income (expense), net ................. (14) 4 4 (1)
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Income (loss) before income taxes ........... 396 (50) 725 (33)
Provision for income taxes .................. -- -- (6) --
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Net income (loss) ........................... $ 396 $ (50) $ 719 $ (33)
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Net income (loss) per share - basic ......... $ 0.08 $ (0.01) $ 0.14 $ (0.01)
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Weighted average basic shares outstanding ... 5,244 5,193 5,238 5,190
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Net income (loss) per share - diluted ....... $ 0.07 $ (0.01) $ 0.13 $ (0.01)
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Weighted average diluted shares outstanding.. 5,779 5,193 5,744 5,190
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(1) On March 4, 2004, Datawatch's Board of Directors approved a two-for-one
stock split of its common stock. The stock split entitled each shareholder
of record at the close of business on March 19, 2004 (record date) to
receive one additional share for every share of Datawatch common stock held
on that date. All share amounts for all periods presented have been
adjusted to reflect the effect of the stock split.
DATAWATCH CORPORATION AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
Amounts in Thousands
MARCH 31, SEPTEMBER 30,
2004 2003
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ASSETS:
Cash and investments .................... $ 6,106 $ 5,071
Accounts receivable, net ................ 3,693 3,041
Inventories ............................. 92 105
Prepaid expenses ........................ 651 553
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Total Current Assets ........................ 10,542 8,770
Property and equipment, net ................. 431 461
Other assets ................................ 1,005 1,273
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Total Assets ................................ $ 11,978 $ 10,504
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LIABILITIES AND STOCKHOLDERS' EQUITY:
Accounts payable and accrued expenses ... $ 2,885 $ 2,422
Deferred revenue ........................ 3,027 2,941
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Total Current Liabilities ................... 5,912 5,363
Accrued severance, less current portion ..... -- 3
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Total Liabilities ........................... 5,912 5,366
Stockholders' equity ........................ 6,066 5,138
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Total Liabilities and Stockholders' Equity... $ 11,978 $ 10,504
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