MatrixOne, Inc. Reports Third Quarter Operating Results
WESTFORD, Mass.--April 24, 2002--MatrixOne, Inc. , a leading provider of product collaboration solutions for the value chain, announced today results for its third quarter ended March 30, 2002.For the third quarter ended March 30, 2002, total revenues were $32.6 million, compared to $39.0 million in the same period last year. For the third quarter, net loss was $5.0 million, or $0.11 per share, compared to net income of $2.6 million, or $0.05 per share, in the same period last year. For the third quarter, pro forma net loss, which excludes stock-based compensation, was $4.0 million, or $0.09 per share, compared to pro forma net income of $3.6 million, or $0.07 per share, in the same period last year.
For the nine months ended March 30, 2002, total revenues were $89.5 million, compared to $102.9 million in the same period last year. For the nine months ended March 30, 2002, net loss was $26.2 million, or $0.57 per share, compared to net income of $5.3 million, or $0.11 per share, in the same period last year. For the nine months ended March 30, 2002, pro forma net loss, which excludes stock-based compensation and restructuring charges, was $20.0 million, or $0.44 per share. For the nine months ended March 31, 2001, pro forma net income, which excludes stock-based compensation, was $8.4 million, or $0.17 per share.
All service revenues and cost of service revenues presented herein have been restated to reflect the adoption of Emerging Issues Task Force Issue No. 01-14 relating to the accounting for reimbursements received for out-of-pocket expenses incurred. Accordingly, service revenues include reimbursements received for out-of-pocket expenses incurred, which were previously reported as a reduction in cost of service revenues. Reimbursements received for out-of-pocket expenses incurred were $0.8 million and $0.9 million for the three months ended March 30, 2002 and March 31, 2001, respectively, and $2.7 million and $2.0 million for the nine months ended March 30, 2002 and March 31, 2001, respectively.
"During the third quarter we continued to deepen our industry-leading product collaboration offerings while simultaneously enhancing operational efficiency," said Mark O'Connell, president and chief executive officer of MatrixOne. "Despite a challenging economic environment, we successfully improved our already-strong balance sheet and delivered on the financial expectations we outlined three months ago. The key to our progress continues to be our ability to deliver real value to our growing customer base with our easy-to-implement, easy-to-use Value Chain Portfolio(TM) applications."
The following milestones were completed or announced since MatrixOne's second quarter earnings release on January 23, 2002:
| -- | During the third quarter, MatrixOne continued to realize growing adoption of its Value Chain Portfolio applications and eMatrix(TM) product collaboration platform. MatrixOne recognized significant revenue from many of the world's most innovative companies, including: ADEMCO Group, part of Honeywell's Security and Fire solutions business and a leading manufacturer of electronic security products; Philips Semiconductors, a leader in silicon systems and standard products for consumer, communications, automotive and computing products; and Tower Automotive, a global supplier of structural components and assemblies for the automotive industry. |
| -- | The Company's Value Chain Portfolio of applications continued to gain significant momentum, accounting for approximately 30% of total license revenue during the third quarter. The Value Chain Portfolio of applications is designed to improve and automate common business process problems faced by product and service developers in any company and any industry. The Company's three most recently released applications, Engineering Central(TM), ProgramManagement Central(TM), and DocuManagement Central(TM) - were the Company's best selling applications during the third quarter. The availability of these applications is increasingly important as customers are opting for easy-to-implement, easy-to-use solutions to realize faster results and reduce the long-term maintenance costs of custom-designed solutions. |
| -- | MatrixOne and webMethods formed a partnership to help customers seamlessly integrate their product collaboration solution with other applications throughout their enterprise. The companies are co-developing technology that will leverage the webMethods integration platform to directly link MatrixOne's product collaboration solution with the various enterprise and legacy applications located behind the firewall or within the technology infrastructures of key customers and partners. |
| -- | Industry research firm eMetaprise Research ranked MatrixOne as the top-rated provider of private marketplace software for use by global manufacturers seeking to create more efficient value chains. eMetaprise selected MatrixOne for the top position because of its innovative product collaboration architecture, its visionary strategy for private marketplaces, its extensive partnerships, and the Company's substantial customer references worldwide. MatrixOne solutions provide the product collaboration backbone for many of the world's most innovative and leading private and public marketplaces. |
Company to Host Live Web Cast
The Company's management team will host a live Web cast at 5:30 p.m. Eastern Time today to discuss the financial results and management's forward-looking guidance. For more information, please click on www.matrixone.com/investor.
About MatrixOne
MatrixOne, Inc. is changing the way the world brings products to market(TM). The Company's eMatrix(TM) product collaboration platform and out-of-the-box Value Chain Portfolio(TM) applications enable online collaboration across global value chains and secure access to independent trading communities in private and public marketplaces. A trusted partner to innovative companies, MatrixOne helps customers accelerate the right products to market. MatrixOne's approximately 600 global customers represent the aerospace/defense, apparel, automotive, consumer packaged goods, general machinery, high-technology, and life sciences industries, including GE, Procter & Gamble, Nokia, Siemens, JDS Uniphase, and Honda. Headquartered in Westford, Massachusetts, MatrixOne (www.matrixone.com) also maintains offices in North America, Europe, and Asia, with additional distributors in Latin America and Australia.
MatrixOne is a registered trademark, and eMatrix, Changing the Way the World Brings Products to Market, Product Collaboration Solutions for the Value Chain, Value Chain Portfolio, DocuManagement Central, Engineering Central and ProgramManagement Central are trademarks of MatrixOne, Inc. All other trademarks and service marks are the property of their respective owners.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995 - Forward-looking statements in this release are not promises or guarantees and are subject to risks and uncertainties that could cause our actual results to differ materially from those anticipated. We caution you not to place undue reliance upon any such forward-looking statements, which speak only as of the date made. Such statements may relate, among other things, to our ability to respond to economic changes and improve operational efficiency or our plans, objectives, and expected financial and operating results. Forward-looking statements will also include, without limitation, any statement relating to future events, conditions or circumstances or using words such as: will, believe, anticipate, expect, could, may, estimate, project, plan, predict, or intend. The risks and uncertainties that may affect forward-looking statements include, among others: the weakening of the worldwide economy may have an adverse effect on our financial results; the market may not accept our products; our sales cycle is lengthy and variable; we may be unable to develop new products and services that keep pace with technology; we may be unable to develop and maintain successful relationships with systems integrators and complementary technology vendors; our international operations are subject to additional business risks; future acquisitions may adversely affect our operations and financial results; we may be unable to manage our rapid growth which places a significant strain on our resources; and increased competition may have an adverse effect on pricing, revenues, gross margins and our customer base. For a more detailed discussion of the risks and uncertainties of our business, please refer to our periodic reports and registration statements filed with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the fiscal year ended June 30, 2001 and our Quarterly Report on Form 10-Q for the quarter ended December 29, 2001.
MATRIXONE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
Three Months Ended Nine Months Ended
----------------------- -----------------------
March 30, March 31, March 30, March 31,
2002 2001 2002 2001
--------- --------- --------- ---------
(unaudited) (unaudited) (unaudited) (unaudited)
Revenues:
Software license $ 13,083 $ 22,426 $ 33,410 $ 62,353
Service 19,501(b) 16,586(b) 56,043(b) 40,557(b)
--------- --------- --------- ---------
Total revenues 32,584 39,012 89,453 102,910
--------- --------- --------- ---------
Cost of Revenues:
Software license 1,739 2,420 4,038 6,334
Service 13,724(b) 12,397(b) 41,988(b) 30,640(b)
--------- --------- --------- ---------
Total cost of
revenues 15,463 14,817 46,026 36,974
--------- --------- --------- ---------
Gross Profit 17,121 24,195 43,427 65,936
--------- --------- --------- ---------
Operating Expenses:
Selling and
marketing 12,204 14,027 38,580 42,956
Research and
development 6,227 5,608 18,397 13,431
General and
administrative 3,309 2,673 9,269 7,187
Stock-based
compensation 983 1,031 2,944 3,117
Restructuring
charges -- -- 3,202 --
--------- --------- --------- ---------
Total operating
expenses 22,723 23,339 72,392 66,691
--------- --------- --------- ---------
Income (Loss)
from Operations (5,602) 856 (28,965) (755)
Other Income, Net 596 2,364 2,799 7,520
--------- --------- --------- ---------
Income (Loss) Before
Income Taxes (5,006) 3,220 (26,166) 6,765
Provision for
Income Taxes -- 638 -- 1,465
--------- --------- --------- ---------
Net Income (Loss) $ (5,006) $ 2,582 $ (26,166) $ 5,300
========= ========= ========= =========
Net Income (Loss)
Per Share:
Basic net
income (loss)
per share $ (0.11) $ 0.06 $ (0.57) $ 0.12
========= ========= ========= =========
Diluted net
income (loss)
per share $ (0.11) $ 0.05(a) $ (0.57) $ 0.11(a)
========= ========= ========= =========
Shares Used in
Computing:
Basic net income
(loss) per
share 46,462 43,982 45,890 43,090
========= ========= ========= =========
Diluted net
income (loss)
per share 46,462 50,360(a) 45,890 50,303(a)
========= ========= ========= =========
Reconciliation of Pro
Forma Net Income (Loss):
Net Income (Loss) $ (5,006) $ 2,582 $ (26,166) $ 5,300
Adjustments:
Stock-based
compensation 983 1,031 2,944 3,117
Restructuring charges -- -- 3,202 --
--------- --------- --------- ---------
Pro Forma Net
Income (Loss) $ (4,023) $ 3,613 $ (20,020) $ 8,417
========= ========= ========= =========
Pro Forma Net Income
(Loss) Per Share:
Pro forma basic
net income
(loss) per
share $ (0.09) $ 0.08 $ (0.44) $ 0.20
========= ========= ========= =========
Pro forma
diluted net
income (loss)
per share $ (0.09) $ 0.07(a) $ (0.44) $ 0.17(a)
========= ========= ========= =========
Shares Used in
Computing:
Pro forma basic
net income (loss)
per share 46,462 43,982 45,890 43,090
========= ========= ========= =========
Pro forma
diluted net
income (loss)
per share 46,462 50,360(a) 45,890 50,303(a)
========= ========= ========= =========
(a) The shares used in the computation of diluted net income per
share for the three and nine months ended March 31, 2001 include
6,378 and 7,213 common stock equivalents, such as stock options
and warrants, respectively.
(b) Service revenues have been restated to include reimbursements
received for out-of-pocket expenses incurred, which were
previously reported as a reduction in cost of service revenues.
Reimbursements received for out-of-pocket expenses incurred were
$807 and $907 for the three months ended March 30, 2002 and March
31, 2001, respectively, and $2,716 and $1,966 for the nine months
ended March 30, 2002 and March 31, 2001, respectively.
MATRIXONE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
March 30, June 30,
2002 2001
----------- ----------
(unaudited)
ASSETS
Current Assets:
Cash and equivalents $ 143,667 $ 156,349
Accounts receivable, net 30,180 42,619
Prepaid expenses and other current assets 7,292 3,535
--------- ---------
Total current assets 181,139 202,503
Property and Equipment, Net 15,395 12,291
Other Assets 2,617 2,832
--------- ---------
$ 199,151 $ 217,626
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable $ 10,501 $ 9,966
Accrued expenses 23,058 21,125
Deferred revenues 18,211 17,219
--------- ---------
Total current liabilities 51,770 48,310
--------- ---------
Stockholders' Equity:
Common stock 467 452
Additional paid-in capital 210,123 209,065
Deferred stock-based consideration (4,896) (8,297)
Accumulated deficit (56,146) (29,980)
Accumulated other comprehensive loss (2,167) (1,924)
--------- ---------
Total stockholders' equity 147,381 169,316
--------- ---------
$ 199,151 $ 217,626
========= =========