Exhibit 99.1
[LOGO OF ACCESS WORLDWIDE]
Contacts:
Access Worldwide Communications, Inc. Access Worldwide Communications, Inc.
(571) 438-6140 (571) 438-6140
Mark Wright Richard Lyew
Investor Relations EVP & Chief Financial Officer
mwright@accessww.com rlyew@accessww.com
ACCESS WORLDWIDE REPORTS FOURTH QUARTER
AND YEAR-END FINANCIAL RESULTS
BOCA RATON, FL - APRIL 18, 2006 - ACCESS WORLDWIDE COMMUNICATIONS, INC. (OTC
BULLETIN BOARD: AWWC), a leading marketing services company, today reported
financial results for the three and twelve months ended December 31, 2005.
For the Three Months Ended December 31, 2005
- --------------------------------------------
Our revenues decreased by $0.1 million, or 0.9%, to $10.6 million for the
quarter ended December 31, 2005, compared to $10.7 million for the quarter ended
December 31, 2004. Revenues for the Pharmaceutical Services Segment, which
includes our medical education and pharmaceutical communication businesses,
decreased $0.4 million, or 6.0%, to $6.3 million for the quarter ended December
31, 2005, compared to $6.7 million for the quarter ended December 31, 2004. The
decrease was attributed to a decrease in programs with significant customers at
both our pharmaceutical communication business and medical education division,
offset by an increase in value-added billing generated by the increase in
requests from pharmaceutical communication customers for additional reporting
and IT analysis. Revenues for the Business Services Segment, which includes our
multilingual communications business and our offshore communication business,
increased $0.3 million, or 7.5%, to $4.3 million for the quarter ended December
31, 2005, compared to $4.0 million for the quarter ended December 31, 2004. The
increase in revenues is primarily attributed to the revenues generated by our
communication center in the Philippines, which became operational in the later
part of 2005.
We reported a net loss of $1.4 million and a net basic and diluted loss per
share of common stock of $0.08 for the quarter ended December 31, 2005, compared
to a net loss of $0.6 million and a net basic and diluted loss per share of
common stock of $0.06 for the quarter ended December 31, 2004. The increase in
net loss and net basic and diluted loss per share of common stock was attributed
to a net loss for the fourth quarter of approximately $0.1 million in our
Philippines communication center, which did not generate net income until
December 2005, along with an increase in interest expense of approximately $0.2
million compared to the same quarter of the prior year due to increased
borrowing on our debt, and the increase payroll costs included in cost of
revenues of approximately $0.4 million at our pharmaceutical communication
business due to unusually high staffing requirements for a certain inbound
program. Total weighted average diluted shares outstanding for the quarters
ended December 31, 2005 and December 31, 2004 were 16,609,552 and 10,546,386,
respectively.
For the Twelve Months Ended December 31, 2005
- ---------------------------------------------
Our revenues decreased $8.6 million, or 18.1%, to $38.9 million for 2005,
compared to $47.5 million for 2004. Revenues for the Pharmaceutical Segment
decreased $0.6 million, or 2.4%, to $24.5 million for 2005, compared to $25.1
million for 2004. This decrease was caused primarily by a decrease in work being
performed for a significant customer at our medical education division. The
decrease in revenues from our medical education division was offset by an
increase in value-added billing for two significant customers in pharmaceutical
communication business. This value-added billing was generated by the increase
in programs and the increase in requests from these customers for additional
reporting and IT analysis. Revenues for the Business Segment decreased $8.0
million, or 35.7%, to $14.4 million for 2005, compared to $22.4 million for
2004. The decrease in revenues is primarily attributed to the lead time
necessary for our three new business development professionals to replace the
revenue lost from a prior client prematurely halting its marketing programs due
to court rulings and regulatory changes that made it difficult to sell bundled
services to consumers. We are continuing to experience an increase in business
activity from each of these individuals. The reduction in revenue domestically
in our Business Services was offset somewhat by the international revenues
generated in our communication center in the Philippines, which became
operational in the later part of 2005.
We reported a net loss of $5.4 million and a net basic and diluted loss per
share of common stock of $0.41 for the twelve months ended December 31, 2005,
compared to a net loss of $1.4 million and a net basic and diluted loss per
share of common stock of $0.14 for the twelve months ended December 31, 2004.
The increase in net loss and net basic and diluted loss per share of common
stock was primarily attributed to a decrease in revenues as described above as
well as an increase in interest expense of approximately $0.5 million and a
charge of approximately $0.7 million resulting from a deemed dividend relating
to warrants issued to certain stockholders. Total weighted average diluted
shares outstanding for the twelve months ended December 31, 2005 and 2004
respectively were 13,084,761 and 10,008,271, respectively.
"We were unable to timely replace the lost revenues in our Business Services
Segment and therefore our financial results for 2005 were very disappointing,"
remarked Shawkat Raslan, Chairman and Chief Executive Officer of Access
Worldwide. "During the second half of 2005 we were successful in opening our
first overseas communications center in Manila, Philippines, and are very
pleased with the initial results. We have also been successful in attracting new
opportunities to our Business Services Segment and expect to see increased
revenues in that segment during 2006."
Founded in 1983, Access Worldwide provides a variety of sales, marketing and
medical education services. Among other things, we reach physicians, pharmacists
and patients on behalf of pharmaceutical clients, educating them on new drugs,
prescribing indications, medical procedures and disease management programs.
Services include product stocking, medical education, database management,
clinical trial recruitment and teleservices. For clients in the
telecommunications, financial services, insurance and consumer products
industries, we reach the established mainstream and growing multicultural
markets with multilingual teleservices. Access worldwide is headquartered in
Boca Raton, florida and has about 1,000 employees in offices throughout the
United States and Asia. More information is available at www.accessww.com.
This press release contains forward-looking statements including statements
regarding financial results. Such statements involve known or unknown risks,
uncertainties and other factors that may cause the actual results to differ
materially from those expressed or implied by such forward-looking statements.
Factors that could cause actual results to differ materially from those
expressed or implied by such forward-looking statements, include, but are not
limited to, the following: We face risks related to our Debt Agreement; we have
incurred significant losses over the last three years and we may never achieve
or sustain profitability; we may not be able to obtain additional capital to
fund our
operations on reasonable terms and this could hurt our business and
negatively impact our stockholders; if the holders of our Convertible Notes do
not convert the principal into common stock prior to or at maturity of those
notes, the payment of these amounts could have an impact on our cash position;
conversion of the convertible notes will significantly dilute the percentage
ownership of our existing stockholders; our future growth is dependent on the
trend toward outsourcing; we are heavily dependent on the industries we serve,
particularly the pharmaceutical and telecommunications industries; we may be
affected by changes in a drug's lifecycle; we could be severely impacted by the
loss of any of the Company's largest clients; we could be affected by a loss of
contracts; we rely on technology and could be adversely affected if the Company
is unable to maintain facilities with the needed equipment; we are dependent on
key personnel and may be affected by changes in senior management; we are
dependent on our labor force and could be affected by potentially high turnover
rates; we could be affected by a business interruption; our stock price has
declined substantially at times in the previous year and may become more
volatile; we face risk due to our stock trading on the Over the Counter Bulletin
Board ("OTCBB"); we face a risk that we may not be able to successfully operate
our new communication center in Manila, Philippines; we may be adversely
impacted by competition, industry consolidation and potential consumer
saturation; we were impacted by the events of September 11, 2001, and may be
impacted in the future by events of a similar nature, war and other
international conflicts; we are subject to extensive regulations and compliance
with these regulations can be costly, time consuming and subject the Company to
fines for non-compliance. For a more detailed discussion of these risks and
others that could affect results, see our filings with the Securities and
Exchange Commission, including the risk factors section of Access Worldwide's
Annual Report on Form 10-K for the year ended December 31, 2005 filed with the
Securities and Exchange Commission. The Company assumes no duty to update any
forward-looking statements.
- TABLES FOLLOW -
ACCESS WORLDWIDE COMMUNICATIONS, INC.
Condensed Consolidated Balance Sheets
DECEMBER 31,
----------------------------
2005 2004
------------ ------------
ASSETS
Current Assets:
Cash and cash equivalents $ 1,755,926 $ 2,570,546
Restricted cash 314,000 122,000
Accounts receivable,net 7,297,583 7,567,448
Unbilled receivables 228,083 398,547
Other assets, net 785,257 1,001,671
------------ ------------
Total current assets 10,380,849 11,660,212
Property and equipment, net 5,025,158 3,614,322
Restricted cash 466,000 589,000
Other assets, net 390,822 146,177
------------ ------------
Total assets $ 16,262,829 $ 16,009,711
============ ============
LIABILITIES, MANDATORILY REDEEMABLE PREFERRED STOCK
AND COMMON STOCKHOLDERS' DEFICIT
Current Liabilities:
Current portion of indebtedness $ 4,876,381 $ 2,955,450
Current portion of indebtedness - related parties 352,334 352,334
Accounts payable 1,878,856 739,438
Accrued expense 2,204,267 2,857,183
Grants payable 80,000 2,257,000
Accrued salaries, wages and related benefits 736,797 1,204,301
Customer deposits 1,084,378 599,030
Convertible Notes, net 1,768,584 -
Deferred revenue 1,435,619 2,548,341
Accrued interest and other related party expenses 59,512 12,673
------------ ------------
Total current liabilities 14,476,728 13,525,750
Long-term portion of indebtedness 669,441 135,008
Other long-term liabilities 796,418 786,386
Convertible Notes, net 1,380,564 1,427,685
Mandatorily redeemable preferred stock, $0.01 par value:
1,000,000 shares authorized, 40,000 shares issued and outstanding 4,000,000 4,000,000
------------ ------------
Total liabilities 21,323,151 19,874,829
------------ ------------
Commitments and contingencies
Common stockholders' deficit:
Common stock, $0.01 par value: voting 40,000,000 shares authorized;
16,616,219 and 10,841,719 shares issued and outstanding,
respectively 166,162 108,417
Additional paid-in capital 70,389,446 66,228,271
Accumulated deficit (75,602,730) (70,182,006)
Deferred compensation (13,200) (19,800)
------------ ------------
Total common stockholders' deficit (5,060,322) (3,865,118)
------------ ------------
Total liabilities, mandatorily redeemable preferred stock
and common stockholders' deficit $ 16,262,829 $ 16,009,711
============ ============
ACCESS WORLDWIDE COMMUNICATIONS, INC.
Condensed Consolidated Statements of Operations
UNAUDITED
FOR THE THREE MONTHS ENDING FOR THE TWELVE MONTHS ENDING
DECEMBER 31, DECEMBER 31,
---------------------------- ----------------------------
2005 2004 2005 2004
------------ ------------ ------------ ------------
Revenues $ 10,580,495 $ 10,653,922 $ 38,921,727 $ 47,466,996
Cost of revenues 6,022,836 5,948,517 22,368,204 27,458,913
------------ ------------ ------------ ------------
Gross profit 4,557,659 4,705,405 16,553,523 20,008,083
Selling, general & administrative expenses 5,514,443 5,023,524 19,475,743 20,105,495
------------ ------------ ------------ ------------
Loss from operations (956,784) (318,119) (2,922,220) (97,412)
Interest expense, net (446,941) (307,046) (1,758,504) (1,313,621)
------------ ------------ ------------ ------------
Net loss (1,403,725) (625,165) (4,680,724) (1,411,033)
Deemed dividend - warrants issued to certain stockholders - - (740,000) -
------------ ------------ ------------ ------------
Net loss applicable to common stockholders $ (1,403,725) $ (625,165) $ (5,420,724) $ (1,411,033)
============ ============ ============ ============
Basic and dilued loss per share of common stock $ (0.08) $ (0.06) $ (0.41) $ (0.14)
Weighted average common shares outstanding 16,609,552 10,546,386 13,084,761 10,008,271