Metrowerks Records Revenues of $ 5.5 Million for the Third Quarter Ended April 30, 1998
AUSTIN, Texas — May 20, 1998 — Metrowerks Inc., a leading provider of software development tools for desktop and embedded systems, today announced its results of operations for the third quarter ended April 30, 1998 (Q3FYJuly98).
Revenues for Q3FYJuly98 totaled US$ 5.5 million, a 52 percent increase over revenues of $ 3.6 million for the corresponding period in the prior fiscal year, and an increase of 10 percent over revenues of US$ 5.0 million for Q2FYJuly98.
In Q3FYJuly98, the Company recorded a non-recurring charge of $ 2.5 million against sales to reflect its previously announced intention to sell its embedded software products directly to customers and through experienced embedded partners such as Applied Microsystems. In Q3FYJuly98, the Company stopped selling embedded software products through the reseller channel, and this charge represents the significant remaining inventory which was in the channel.
In Q3FYJuly98, the Company reported a loss, prior to the one-time charge against sales, of US$ 697,000 (US$ 0.05 per share on a diluted basis), compared to a loss of US$ 1.6 million for the corresponding period in the prior fiscal year (prior to non-recurring charge), and compared to a loss of US$ 763,000 (US$ 0.06 per share) for Q2FYJuly98. The Company's net loss in Q3FYJuly98 after the one- time charge of $ 2.5 million totaled $ 3.2 million. The Company had a cash balance of approximately $ 10.7 million at April 30, 1998.
The Company has significantly increased its penetration in its core strategic markets:
Nintendo: Metrowerks has entered into a relationship with a joint- venture company of Nintendo Co. Ltd. (Japan) to develop and deliver CodeWarrior development tools for the Nintendo 64 Game Console. Metrowerks expects to ship Nintendo-enabled CodeWarrior tools in the second half of calendar 1998
SAP: Metrowerks, in conjunction with SAP Labs Japan, will develop and deliver worldwide CodeWarrior tools supporting SAP's BAPI interfaces to their R/3 enterprise software and enable connectivity between PDAs, mobile information appliances and desktop PCs to SAP's R/3 enterprise software. Metrowerks expects to ship BAPI- enabled CodeWarrior tools in the second half of calendar 1998.
Seiko: Metrowerks has entered into a development relationship with Seiko Instruments Inc. (Japan) to develop and deliver CodeWarrior tools for the Seiko BrainPad Tipo PDA in Japan. Metrowerks expects to ship CodeWarrior for BrainPad Tipo tools in the second half of calendar 1998.
Novell: In conjunction with Novell, Inc., Metrowerks has shipped CodeWarrior for NetWare, Metrowerks' software development tools for NetWare developers. Inclusion of full Windows95, Windows NT and Java toolsets makes CodeWarrior the most comprehensive package of tools available for NetWare development.
"We are on the move," said Jean Belanger, Metrowerks CEO and Chairman. "Metrowerks is beginning to see the results of its efforts in the embedded market, as evidenced by the design wins we announced today. Our financial results are not yet satisfactory but we have built a strong base in the embedded business which should translate into higher seat sales in the future. The way we distribute our embedded products had to change to a direct model, and we have been conservative in our decision to reduce significantly the amount of inventory in the indirect distribution channels."
This release, other than historical financial information, may consist of forward-looking statements that involve risks and uncertainties. These statements may differ materially from actual future events or results. For instance, factors which could cause results to differ from future events include the state of the Mac OS tools market, the timing of product deliveries, competitive pricing actions and marketing programs, among others. Additional information on these and other factors which could affect the Company's financial results are included in the Company's 1997 annual report to shareholders and most recent quarterly reports on file with the Securities and Exchange Commission.
Earnings Table
All figures are reported in '000s US dollars (except per share amount):
METROWERKS INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands of US dollars)
(unaudited)
For the 3 months ended
April 30 Jan. 31 Oct. 31 July 31 April 30
1998 1998 1997 1997 1997
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REVENUES
Revenues, net, prior to non-recurring charge 5,537 5,010 6,153 6,228 3,615
Non-recurring charge (2,500) – – – –
—————————————————————-
Revenues, net 3,037 5,010 6,153 6,228 3,615
DIRECT COSTS AND EXPENSES
Cost of goods sold 606 685 1,133 1,062 958
Research and development 2,595 2,382 2,083 2,272 1,828
Selling, marketing, administrative and technical support 2,754 2,473 2,374 2,436 2,198
Amortization of capital assets 398 408 386 360 324
Non-recurring charge – – – – 4,297
Interest income (119) (175) (60) (57) (70)
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6,234 5,773 5,916 6,073 9,535
NET EARNINGS/(LOSS) (3,197) (763) 237 155 (5,920)
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EARNINGS (LOSS) PER SHARE $ (0.25) $ (0.06) $ 0.02 $ 0.01 $ (0.51)
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Weighted average number of shares outstanding 12,867 11,932 11,555 11,538 11,529
About Metrowerks
Founded in 1985, Metrowerks develops, markets and supports CodeWarrior software development solutions for a number of operating systems targeting the most popular microprocessors. Intended for use for embedded systems or desktop computers, the cross-platform compilers support C, C++, Java, and Object Pascal, and allow programmers to build applications for a number of different target platforms, all from one unique Integrated Development Environment (IDE). Metrowerks' CodeWarrior products are used by more than 100,000 registered users in 75 countries.
Metrowerks, the Metrowerks logo and CodeWarrior are registered trademarks of Metrowerks Inc. All other company and product names may be registered trademarks or trademarks of their respective companies/holders, and are hereby recognized.
CONTACT:
Metrowerks Inc.
Gordy Davies, 512/873-4797
[email protected]
or
Metrowerks Inc.
Jim Welch, 512/873-4777
[email protected]