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EXHIBIT 99
FOR IMMEDIATE RELEASE
Contacts: Valerie Brodie
Director, Investor Relations
949/585-4293
vbrodie@epicor.com
EPICOR REPORTS SECOND QUARTER 2000 FINANCIAL RESULTS
IRVINE, Calif., July 27, 2000 -- Epicor Software Corporation (NASDAQ:
EPIC), today reported its financial results for the second quarter ended June
30, 2000. Total revenues for the second quarter were $57.5 million compared with
$66.2 million for the second quarter 1999. Net loss for the quarter was $5.0
million or $0.12 per share, compared with a net income of $395,000 or $0.01 per
share for the same period last year.
The company reported a sequential increase in total revenues in the
second quarter over the first quarter ended March 31, 2000 with improved
performance versus last quarter from its newly released integrated "e by Epicor"
suite, including eBackOffice, eFrontOffice and eManufacturing. The company
believes that this trend is consistent with the beginning of a rebound in the
demand for enterprise applications accelerated by the higher growth demand for
integrated CRM and eBusiness components.
Revenues for the six month period ended June 30, 2000 were $114.1
million. Net loss for the first six months of 2000 was $13.9 million or $0.34
per share.
The company's balance sheet at June 30, 2000 showed cash, cash
equivalents and short-term investments of $9.0 million, accounts receivable of
$81.6 million and deferred revenue of $44.2 million. The company also announced
today that it has entered into an agreement for a $30 million senior credit
facility with Foothill Capital Corporation, a subsidiary of Wells Fargo. "We
anticipate that the company will generate positive cash flow through operations
this quarter," said Lee Kim, vice president and chief financial officer.
"However, as a measure of prudent fiscal planning, we have secured this
alternative financing source from Foothill."
The company has continued to execute successfully against aggressive
operating goals to reduce its on-going cost structure during the first half of
2000. "We improved our gross margins by resizing our consulting group and
increasing our utilization rates," said Rick Roll, president and COO. "We
believe the streamlining of our organization and the reduction of our cost
structures over the last several quarters have paid off."
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Epicor Reports Second Quarter 2000 Financial Results
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The company has launched significant new and upgrade products during
the first half of the year with the integrated e by Epicor suite, including
eBackOffice, eFrontOffice, eCommerce, eProcurement and ePeople. "We are
optimistic about the outlook for the demand for our new products driven by the
midmarket's requirement to initiate competitive advantages in the new economy,"
said George Klaus, chairman and CEO. "We believe the anticipated turnaround is
occurring and that the renewed growth for enterprise applications combined with
the positive reception of our new integrated CRM and eBusiness components will
deliver upside potential for Epicor."
ABOUT EPICOR SOFTWARE CORPORATION
Epicor is the largest provider of integrated enterprise and eBusiness
software solutions exclusively for midmarket companies. Epicor helps businesses
around the world build eBusiness into their entire organization by integrating
their systems and operations with the Internet to focus their entire enterprise
on their customers. By integrating leading edge eBusiness applications with
advanced front office customer relationship management (CRM) applications and
proven back office ERP applications, Epicor provides midmarket companies with
the complete solution they need to compete in the new Internet economy.
Founded in 1984, Epicor is ranked among the industry's ten largest
enterprise business solutions providers by industry analysts, with more than
30,000 customers worldwide. Epicor is headquartered at 195 Technology Drive,
Irvine, California, 92618, and the main phone is (949) 585-4000. More
information about Epicor, its products and services is available at
www.epicor.com.
# # #
Epicor is a trademark of Epicor Software Corporation. Platinum is a registered
trademark of PLATINUM technology International, Inc.
The foregoing statements regarding demand for new products and anticipated
positive cash flow from operations, which are not historical fact, are
"forward-looking statements" that involve risks and uncertainties and actual
results may differ materially. Such risks and uncertainties include but are not
limited to, the company's success in controlling costs, achieving revenue and
operating results and margins; collection of accounts receivable on a timely
basis; fluctuations in demand for the company's products, particularly in light
of competitive offerings; the timely availability and market acceptance of new
products and upgrades, the impact of competitive products and pricing, and the
discovery of undetected software errors and other factors discussed in the
company's Quarterly report on Form 10-Q, for the period ending March 31, 2000 at
pages 13-19. As a result of these factors the business or prospects expected by
the company as part of this announcement may not occur. The company undertakes
no obligation to revise or update publicly any forward-looking statements.
-More-
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Epicor Reports Second Quarter 2000 Financial Results
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EPICOR SOFTWARE CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
JUNE 30, DECEMBER 31,
2000 1999
--------- ------------
(Unaudited) (Audited)
ASSETS
Current assets:
Cash and cash equivalents $ 6,587 $ 18,221
Short-term investments 2,443 12,154
Accounts receivable, net 81,561 75,263
Prepaid expenses and other 8,560 8,984
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Total current assets 99,151 114,622
Property and equipment, net 14,423 16,650
Software development costs, net 11,629 9,083
Intangible assets, net 22,540 25,668
Other assets 3,615 4,154
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Total assets $ 151,358 $ 170,177
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 12,668 $ 14,591
Accrued expenses 28,199 32,801
Accrued merger and restructuring costs 4,372 11,562
Deferred revenue 44,235 39,017
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Total current liabilities 89,474 97,971
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Long-term liabilities 295 400
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Stockholders' equity:
Preferred stock 7,501 7,501
Common stock 42 41
Additional paid-in capital 240,805 237,536
Less: notes receivable from officers for issuance
of restricted stock (9,969) (11,269)
Accumulated other comprehensive loss (2,516) (1,590)
Accumulated deficit (174,274) (160,413)
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Total stockholders' equity 61,589 71,806
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Total liabilities and stockholders'equity $ 151,358 $ 170,177
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Epicor Reports Second Quarter 2000 Financial Results
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EPICOR SOFTWARE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(Unaudited)
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
---------------------- -----------------------
2000 1999 2000 1999
-------- -------- --------- --------
Revenues:
License fees $ 20,360 $ 23,806 $ 41,005 $ 49,444
Services 36,244 40,318 71,110 79,020
Other 881 2,032 1,981 3,797
-------- -------- --------- --------
Total revenues 57,485 66,156 114,096 132,261
Cost of revenues 26,546 30,046 54,033 58,050
-------- -------- --------- --------
Gross profit 30,939 36,110 60,063 74,211
Operating expenses:
Sales and marketing 19,113 19,568 39,798 40,213
Software development 7,327 6,559 13,073 12,118
General and administrative 10,444 9,381 22,418 19,920
Special charges (700) -- (700) --
-------- -------- --------- --------
Total operating expenses 36,184 35,508 74,589 72,251
-------- -------- --------- --------
Income (loss) from operations (5,245) 602 (14,526) 1,960
Other income (expense), net 265 (137) 665 946
-------- -------- --------- --------
Income (loss) before income taxes (4,980) 465 (13,861) 2,906
Provision for income taxes -- 70 -- 436
-------- -------- --------- --------
Net income (loss) $ (4,980) $ 395 $ (13,861) $ 2,470
======== ======== ========= ========
Net income (loss) per share - basic $ (0.12) $ 0.01 $ (0.34) $ 0.06
Net income (loss) per share - diluted $ (0.12) $ 0.01 $ (0.34) $ 0.06
Common shares outstanding - basic 41,468 40,449 41,365 40,441
Common shares outstanding - diluted 41,468 41,731 41,365 41,833