IMSI(R) Announces First Quarter Results With a 251% Increase in
Revenue Company Exceeds Revenue and Earnings Guidance and Turns
Cash Flow Positive NOVATO, Calif., Nov. 11 /PRNewswire-FirstCall/
-- IMSI(R) (OTC:IMSI) (BULLETIN BOARD: IMSI) , a leading developer
and publisher of precision design, consumer and business software
solutions, today announced its financial results for the three
months ended September 30, 2004. IMSI reported net revenues of $5.7
million and a net loss of $275,000, or $0.01 per share. Net
revenues from continuing operations increased 251% as compared to
the same period in the previous fiscal year reflecting the strength
of the precision design business and the acquisition of Allume
Systems, Inc. (formerly Aladdin Systems, Inc.), which was completed
in the fourth quarter of FY 2004 and the acquisition of Houseplans,
Inc. in November 2003. The company's financial results improved
significantly as compared to prior periods. Amongst the many
improvements were the following; -- Sales increased to $5.7
million, representing an increase from $1.6 million (a 251%
increase from the same period of the prior year) and $5.3 million
(an 8% increase on a sequential basis) reflecting the strength of
our products and services. The sequential sales increase is
particularly noteworthy as the summer months are a traditionally
slow period for software sales. -- Gross margins improved to 73%
from 65% (a 12% increase from the same period of the prior year)
and 67% (a 9% increase on a sequential basis) reflecting
improvements in distribution and increased direct marketing
activities. -- Cash generated from operations was a positive
$163,000 as compared to a negative $2.0 million from the prior
years quarter and a negative $455,000 on a sequential basis. --
Operating loss narrowed substantially both sequentially and as
compared to the prior years quarter to $286,000 from $1.6 million
and $616,000, respectively. This decrease reflects the
effectiveness of our cost reduction programs and integration
efforts, which have been a primary focus of the company during the
last six months. -- Net loss per share improved to $0.01 as
compared to our guidance range of a loss per share of $0.03 to
$0.05 and a negative $0.02 per share from the same quarter of the
prior year. -- EBITDA, which excludes interest, amortization and
depreciation of $432,000, was a positive $158,000, an improvement
from a negative $454,000 from the same quarter of the prior year
and a negative $192,000 from the fourth quarter of FY 2004. With
the doubling of our revenue and our plan to generate operating
profits in the current fiscal year from further cost cutting and
operating efficiencies realized from acquisitions, IMSI is well
positioned to create long term shareholder value. The sale of the
Keynomics subsidiary and the Cadalog.com website, both at a gain,
are examples of our continuing focus on the most profitable and
strategic segments of our core business. "As demonstrated by the
financial improvements from the quarter, we are driving to
profitability with a strong focus on increased sales and lower
operating expenses to return the company to solid sustainable
profitability", said Martin Wade, IMSI CEO. "As we have in the past
twelve months, we plan to continue to identify, acquire and
integrate high growth companies aimed at optimizing operating
performance." "With the successful launch of several products in
the September quarter, including new versions of our two flagship
products StuffIt and TurboCAD, we continue to deliver on our
product focused growth strategy", stated Gordon Landies, IMSI
President. "Our key initiatives will leverage our strengths in
acquiring, developing and distributing products and services direct
to consumers and businesses. During the quarter we had strong
results across all of our major product areas including utilities,
precision design and the distribution of house plans online. We are
excited by the progress of our Houseplans, Inc. subsidiary and the
continued growth in its stock house plan library, which now exceeds
17,000 plans, the largest on the Internet. As demonstrated by our
recent purchase of Abbisoft House Plans, Inc ("Abbisoft"), we
intend to continue to acquire products and services which are a
strategic fit with our existing assets and strategy." The following
significant events occurred during the September quarter;
HOUSEPLANS, INC.: -- In October 2004 Houseplans, Inc. became the
largest provider of stock house plans with more than 17,000 plans
available at its website, http://www.houseplans.com/. -- On
September 28, 2004, we acquired Abbisoft, the owner and operator of
the http://www.homeplanfinder.com/ website, an acquisition which we
expect to significantly strengthen our stock house plans business.
With Abbisoft's strong reputation with contractors and builders, we
expect to be able to increase our combined reach into this
important segment of the house plans market. -- On September 20,
2004, consistent with our strategy of strengthening relationships
with the builder community, we launched a professional stock house
plans offering at http://www.prohouseplans.com/ a site dedicated to
serving the needs of this community. CONSUMER & BUSINESS
SOFTWARE SOLUTIONS DIVISION: -- Throughout the quarter, this
division of the company had several major product launches
including; -- StuffIt Deluxe & Standard in September 2004:
These new versions allow users faster file compression and
decompression and enhanced backup features that streamline the
process of storing files on multiple CDs/DVDs, and other storage
media. -- Spring Cleaning v7.0; The newest version of the
best-selling Mac clean-up tool which boosts computer performance
and enables users to take control of and protect their privacy. --
In addition to these key products, the division also launched
several other new and popular products. For more information visit
the division's websites at http://www.allume.com/ and
http://www.stuffit.com/. PRECISION DESIGN DIVISION: -- In the
quarter ended September 2004, the division had the following two
major product launches; -- TurboCAD 10.2, which is focused on the
needs of the mechanical and architectural design communities; and
-- FloorPlan 3D v9.0, which allows the user to create designs and
floor plans faster and easier in 3D than ever before. -- We sold
the Cadalog .com website, at a gain, in order to focus on the
delivery of content and services to our customers in the design
industry thru our portal at http://www.cadsymbols.com/. -- In
addition to these product launches, visit http://www.imsisoft.com/
and http://www.turbocad.com/ for additional product and service
information. INTERNATIONAL MICROCOMPUTER SOFTWARE, INC. AND
SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands,
except share amounts) September 30, June 30, 2004 2004 Unaudited
ASSETS Current assets: Cash and cash equivalents $3,806 $3,212
Investment in marketable securities 2,383 2,151 Receivables, less
allowances for doubtful accounts, discounts and returns of $935
2,594 2,522 Inventories, net of reserves for obsolescence of $123
1,072 1,122 Receivables, other (related to discontinued operations)
-- 1,000 Note receivable from related party 350 350 Other current
assets 751 552 Assets related to discontinued operations 1,149 828
Total current assets 12,105 11,737 Fixed assets, net 623 637
Intangible Assets Capitalized software, net 2,604 2,748 Domain
names, net 2,103 1,566 Trademarks 722 709 Distribution rights, net
569 594 Capitalized customer lists 1,008 843 Goodwill 8,759 7,559
Total intangible assets 15,765 14,019 Other assets: Prepaid
expenses 86 99 Investment in securities -- 1,771 Total other assets
86 1,870 TOTAL ASSETS 28,579 28,263 LIABILITIES AND SHAREHOLDERS'
EQUITY Current liabilities: Short term debt 2,601 3,557 Trade
accounts payable 2,145 2,375 Accrued and other liabilities 2,555
1,751 Total current liabilities 7,301 7,683 Liabilities related to
discontinued operations 42 397 Long-term debt and other obligations
2,052 2,318 Total liabilities 9,395 10,398 Shareholders' Equity
Common stock, no par value; 300,000,000 authorized; 28,011,456
issued and outstanding on September 30, 2004 and 26,261,829 issued
and outstanding on June 30, 2004. 43,116 41,512 Accumulated deficit
(23,852) (23,577) Accumulated other comprehensive loss (80) (70)
Total shareholders' equity 19,184 17,865 TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $28,579 $28,263 INTERNATIONAL MICROCOMPUTER
SOFTWARE, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS
OF OPERATIONS and COMPREHENSIVE LOSS (In thousands, except per
share amounts) (Unaudited) Three months ended September 30, 2004
2003 Net revenues $5,694 $1,621 Product costs 1,514 574 Gross
margin 4,180 1,047 Costs and expenses: Sales and marketing 2,293
598 General and administrative 1,134 657 Research and development
1,039 408 Total operating expenses 4,466 1,663 Operating loss (286)
(616) Other income and expense: Interest and other, net 18 82
Realized / unrealized gain (loss) on marketable securities (50) 130
Gain on extinguishment of debt -- 81 Loss before income tax (318)
(323) Income tax (expense) benefit (5) 4 Loss from Continuing
Operations (323) (319) Loss from discontinued operations, net of
income tax (5) (81) Gain from the sale of discontinued operations,
net of income tax 53 -- Net Loss ($275) ($400) Other comprehensive
loss Foreign currency translation adjustments (10) (4)
Comprehensive loss ($285) ($404) Basic and diluted loss per share
Loss from continuing operations ($0.01) ($0.02) Loss from
discontinued operations, net of income tax ($0.00) ($0.00) Gain
from the sale of discontinued operations, net of income tax $0.00
-- Net loss ($0.01) ($0.02) Shares used in computing basic and
diluted loss per share information 26,462 22,934 Business Outlook
IMSI's financial guidance is prepared in accordance with accounting
principles generally accepted in the United States of America. The
following forward-looking statements reflect IMSI's expectations as
of November 11, 2004. Due to potential changes in general economic
conditions and the various other risk factors discussed in IMSI's
reports filed periodically with the Securities and Exchange
Commission, actual results may differ materially. IMSI does not
intend to update these forward-looking statements until its next
quarterly results announcement, other than in other publicly
available statements. in millions expect for per share amounts FY
05 Forecast Guidance Actual Q1 Q1 Q2 Net Revenues $5.4 - 5.6 $5.7
$5.9 - 6.3 Operating Income/ (Loss) ($1.2) - (1.4) $(0.3) ($0.3) -
(0.6) Net Income/(Loss) ($1.1) - (1.3) $(0.3) ($0.2) - (0.5) Fully
Diluted Shares 26.5 26.5 28.3 Earnings/(Loss) per share ($0.03 -
.05) ($0.01) $0.0 - (0.03) Guidance Q3 Q4 Total Net Revenues $6.0 -
6.4 $6.2 - 6.5 $23.8- 24.9 Operating Income/ (Loss) $0.1 - 0.3 $0.3
- 0.7 ($0.2) - 0.1 Net Income/(Loss) $0.2 - 0.4 $2.3 - 2.7 $2.0 -
2.3 Fully Diluted Shares 29.2 29.8 28.8 Earnings/(Loss) per share
$0.01 - 0.03 $0.08 - 0.10 $0.06 - 0.08 About IMSI Founded in 1982,
IMSI has established a tradition of providing the professional and
home user with innovative technology and easy-to-use, high-quality
software products at affordable prices. The company maintains two
business divisions. The Precision Design division, anchored by
IMSI's flagship product, TurboCAD(R) and the DesignCAD(TM) line,
also develops and markets other visual content and design software
such as FloorPlan(R) 3D and TurboCADCAM. The division also includes
several online properties focused on the sale of content and
services to the architectural, engineering and construction market
thru its stock house plans site at Houseplans.com and the online
CAD symbol sites, CADsymbols.com and CADsymbol.net. The Consumer
and Business Software Solutions division, which is anchored by
Allume Systems, Inc. (formerly Aladdin Systems, Inc.), provides
businesses and consumers with software solutions through its
popular products such as StuffIt(R), Internet Cleanup(TM), Spring
Cleaning(TM), SpamCatcher(TM), TurboProject(TM), FormTool(TM),
FlowCharts&More(TM), HiJaak(R) and TurboTyping(TM). More
information about IMSI can be found at http://www.imsisoft.com/ and
http://www.allume.com/. Safe Harbor Statement This announcement
contains forward-looking statements within the meaning of Section
27A of the Securities Act of 1933, Section 21E of the Securities
Exchange Act of 1934, and within the meaning of the Private
Securities Litigation Reform Act of 1995. Actual results could
differ materially from those projected in the forward-looking
statements as a result of various factors including the ability of
the company to successfully commercialize its new technologies as
well as risk factors set forth under "Factors Affecting Future
Operating Results" in the company's annual report on Form 10-KSB,
and as amended, for the year ended June 30, 2004, and such other
risks detailed from time to time in the company's reports filed
with the Securities and Exchange Commission. The company undertakes
no obligation to publicly release the result of any revisions to
these forward-looking statements, which may be made to reflect
events or circumstances after the date hereof or to reflect the
occurrence of unanticipated events. DATASOURCE: IMSI CONTACT: Bill
Bush of International Microcomputer Software, Inc.,
+1-415-878-4039, or Web site: http://www.imsisoft.com/
Copyright