EXHIBIT 99.1
FOR IMMEDIATE RELEASE
SOFTECH ANNOUNCES Q4 AND FY2007 RESULTS
TEWKSBURY, Mass. - August 29, 2007 - SofTech, Inc. (OTCBB:SOFT), a proven
provider of product lifecycle management (PLM) solutions, today announced Q4 and
fiscal 2007 results. Revenue for Q4 FY 2007 was $2.7 million as compared to $3.1
million for the same period in fiscal 2006. The net loss for the current quarter
was ($145,000) or ($.01) per share as compared to ($315,000) or ($.03) per share
for the same period in the prior fiscal year.
Revenue for fiscal year 2007 was about $11.0 million as compared to about $12.5
million for fiscal year 2006. The net loss for fiscal year 2007 was ($1,222,000)
million or ($.10) per share as compared to a net loss of ($1,332,000) or ($.11)
per share for fiscal year 2006.
The net loss adjusted for non-cash expenses related to amortization of
intangible assets resulting from acquisitions, a non-GAAP financial measure, was
$209,000 for the current quarter and $39,000 for the same period in the prior
fiscal year. This same non-GAAP financial measure for fiscal year 2007 was
$194,000 as compared to $540,000 for fiscal year 2006. A reconciliation is
provided on the attached Financial Summary.
The Company's revenue is derived almost entirely from technology acquisitions
completed between 1997 and 2002. As a result, management believes the Company's
financial profile is very unique, at least in the industry in which it operates.
As of May 31, 2007 approximately 66% of its assets are composed of intangible
assets related to these acquisitions. For the current quarter, the amortization
of these intangible assets was approximately 12% of its total expenses and 16%
of its revenue. Further, the periods over which these intangible costs are
expensed are highly judgmental.
It is management's opinion that comparing results of operations from period to
period and to other companies in our industry absent these non-cash expenses
related to acquisitions is a more meaningful measure of our performance given
the Company's unique financial profile detailed above. It is also management's
belief that this non-GAAP measure of performance is one of the most critical
measures of Company valuation for investors. Lastly, this measure of performance
has been, and is expected to continue to be, a significant component of the
incentive compensation plan for the Company's President.
ABOUT SOFTECH
SofTech, Inc. (OTCBB: SOFT) is a proven provider of product lifecycle management
(PLM) solutions with its flagship ProductCenter(TM) PLM solution, and its
computer-aided design and manufacturing (CAD/CAM) products, including CADRA(TM)
and Prospector(TM).
SofTech's solutions accelerate products and profitability by fostering
innovation, extended enterprise collaboration, product quality improvements, and
compressed time-to-market cycles. SofTech excels in its sensible approach to
delivering enterprise PLM solutions, with comprehensive out-of-the-box
capabilities, to meet the needs of manufacturers of all sizes quickly and
cost-effectively.
Over 100,000 users benefit from SofTech solutions, including General Electric
Company, Goodrich, Honeywell, Siemens, Sikorsky Aircraft, U.S. Army, and
Whirlpool Corporation. Headquartered in Tewksbury, Massachusetts, SofTech
(www.softech.com) has locations and distribution partners throughout North
America, Europe, and Asia.
SofTech, CADRA, ProductCenter and Prospector are trademarks of SofTech, Inc. All
other products or company references are the property of their respective
holders.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
The statements made above with respect to SofTech's outlook for fiscal 2007 and
beyond represent "forward looking statements" within the meaning of Section 27A
of the Securities Act of 1933 and Section 21E of the Securities and Exchange Act
of 1934 and are subject to a number of risks and uncertainties. These include,
among other risks and uncertainties, general business and economic conditions,
generating sufficient cash flow from operations to fund working capital needs,
potential obsolescence of the Company's technologies, maintaining existing
relationships with the Company's lenders, successful introduction and market
acceptance of planned new products and the ability of the Company to attract and
retain qualified personnel both in our existing markets and in new territories.
Contact: Jean J. Croteau
President
(978) 640-6222
SOFTECH, INC.
FINANCIAL SUMMARY
(in thousands, except per share data)
STATEMENTS OF OPERATIONS:
FOR THE THREE MONTH PERIODS ENDED
-----------------------------------
MAY 31, MAY 31,
2007 2006
-------- --------
Revenue $ 2,696 $ 3,095
Income from operations 236 52
Net loss (145) (315)
Loss per share (.01) (.03)
FOR THE FISCAL YEAR ENDED
-----------------------------------
MAY 31, MAY 31,
2007 2006
-------- --------
Revenue $ 11,049 $ 12,478
Income (Loss) from operations 238 (115)
Net loss (1,222) (1,332)
Loss per share (.10) (.11)
RECONCILIATION OF NET LOSS TO PRO FORMA NET INCOME:
The net loss calculated in accordance with GAAP is adjusted below by non-cash
expenses related to amortization of intangible assets resulting from
acquisitions. It is management's view that this non-GAAP financial measure of
cash flow provides important information in understanding the Company's
financial performance.
FOR THE THREE MONTH PERIODS ENDED
-----------------------------------
MAY 31, MAY 31,
2007 2006
-------- --------
Net loss $ (145) $ (315)
Plus: Non-cash amortization 354 354
-------- --------
Pro Forma net income (loss) 209 39
FOR THE FISCAL YEAR ENDED
-----------------------------------
MAY 31, MAY 31,
2007 2006
-------- --------
Net loss $ (1,222) $ (1,332)
Plus: Non-cash amortization 1,416 1,872
-------- --------
Pro Forma net income (loss) 194 540