Backweb (NASDAQ:BWEB)
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BackWeb Technologies Ltd. (Nasdaq: BWEB), a leading
provider of offline and mobile Web software, today reported financial
results for its first quarter ended March 31, 2006.
Reflecting growing interest in BackWeb(R) solutions and the
continued expansion of its customer base, BackWeb reported Q1 2006
revenue of $1.66 million, in line with revenue of $1.66 million in the
first quarter of 2005. The Q1 2006 performance reflected a 3% increase
in license sales, offsetting a slight decline in maintenance revenue.
Key license sales in the period included sales to the strategic
management and technology consulting firm Booz Allen Hamilton and
Nationwide Building Society, a leading U.K. financial services and
insurance company. In addition, the quarter included a license upgrade
by Janssen, L.P., a division of Johnson & Johnson focused on
pharmaceuticals for mental health, and partner-generated revenue from
SAP and other partners. Also included was $245,000 of license revenue
from a follow-on sale to F-Secure.
During the first quarter, BackWeb certified its second offline web
application solution with Oracle, validating the integration of
BackWeb Offline Access Server(TM) with Oracle's PeopleSoft Enterprise
Learning Management application. The partnership with Oracle
contributed substantially to new license revenue in the quarter and
provides important future sales opportunities.
Expenses in the quarter were higher, resulting in a net loss of
$842,000, or $0.02 per share, for Q1 2006. This compares to a net loss
of $249,000, or $0.01 per share, in Q1 2005 and $301,000, or $0.01 per
share, in Q4 2005. Non-cash FAS 123R related expenses were included in
operating expenses for the first time in Q1 2006 and were
approximately $100,000 for the quarter. One-time charges associated
with personnel changes were approximately $100,000. Quarterly
operating expenses increased approximately $200,000 as a result of
investments in additional sales and marketing personnel. Going
forward, total quarterly expenses - before any revenue contributions -
are expected to be approximately $2.5 million, including non-cash FAS
123R expense.
BackWeb's balance sheet and cash position continue to remain
sound, with no long-term debt and cash investments totaling
approximately $6.5 million as of March 31, 2006. BackWeb's Vice
President, Finance, Ken Holmes, commented, "Our cash flow for the
quarter reflected an increase in accounts receivable from large sales
completed in Q4 2005 that were not collected until after the Q1
quarter end. Adjusting for the temporary increase in receivables and
subsequent cash collection, BackWeb's cash burn for Q1 2006 would have
been in line with our quarterly cash burn in 2005 of approximately
$600,000."
BackWeb's CEO, Bill Heye, stated, "We continue to see improving
awareness and demand for our product from industry-leading companies.
This trend was evidenced by our increase in license sales this
quarter, which more than made up for approximately $150,000 less in
license revenue from F-Secure compared to Q1 2005. We already see
progress from our personnel investments in the form of increased
productivity from new hires in our field services and sales teams in
the past few months. These new team members were partly responsible
for our increase in license revenue in Q1.
"Going forward, our key factors for success are the further
development of our partnerships with Oracle, SAP and other enterprise
application vendors and the realization of revenue growth through
expanded sales coverage. To that end, we continue to focus our
resources on these two important sources of potential growth."
About BackWeb Technologies:
BackWeb (http://www.backweb.com) mobilizes critical web
applications and content for mobile workforces and remote offices.
Mobile professionals can be productive anytime, anywhere, without
interruption, regardless of connection status or network availability.
BackWeb's patented web and polite synchronization mobile solution
delivers a seamless and simple user experience. The solution is
commonly deployed to sales forces, field employees, mobile managers
and remote operations. Typical e-business applications include
enterprise sales force automation, CRM, e-learning and training and
Human Capital Management (HCM). Content examples include document
repositories and rich media.
BackWeb customers include market leaders such as Boehringer
Ingelheim, Eastman Kodak, GE Healthcare, Hewlett-Packard, Johnson &
Johnson, KLA Tencor, Lam Research, and Pfizer. BackWeb also serves
customers through partnerships with BEA, Oracle PeopleSoft and SAP.
BackWeb's operations are centered in San Jose, California, New York,
New York, and Rosh Ha 'ayin, Israel. Make every minute of your mobile
professional's day productive; visit www.backweb.com or call (877)
222-5932.
(C) 2006 BackWeb Technologies Ltd. All rights reserved. BackWeb is
a registered trademark and Offline Access Server is a trademark of
BackWeb Technologies Ltd. All other trademarks are property of their
respective owners.
Oracle, JD Edwards, PeopleSoft and Siebel are registered
trademarks of Oracle Corporation and/or its affiliates.
Statements in this news release, which are not purely historical,
are forward-looking statements within the meaning of Section 27A of
the Securities Act of 1933 and Section 21E of the Securities Exchange
Act of 1934, including statements of beliefs, plans, expectations or
intentions regarding the future. Such forward-looking statements
include, but are not limited to, statements regarding growing interest
in the Company's solutions, continued expansion of the customer base,
future quarterly expense estimates, solid demand for the Company's
products, increased productivity of new field service and sales
personnel, further development of partnerships with enterprise
application vendors, and revenue growth through expanded sales
coverage. Actual results could differ materially from those in such
forward-looking statements. Factors that could cause actual results to
differ materially from expectations include, but are not limited to,
the uncertainty of market acceptance of offline access products or our
ability to license those products to customers; general economic
conditions or any downturn in IT industry spending; the ability of
BackWeb to develop innovative technology and deliver solutions that
meet customer needs; and the potential emergence of competitive
technologies or competitor companies. In addition, please refer to our
periodic filings with the Securities and Exchange Commission,
including our Quarterly Report on Form 10-Q for the quarter ended
September 30, 2005, which contain more detailed descriptions of the
risk factors facing our business. BackWeb assumes no obligation to
update any of the forward-looking statements in this release.
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BackWeb Technologies Ltd.
Condensed Consolidated Balance Sheets
(in thousands)
March 31, December 31,
2006 2005
Unaudited
---------
ASSETS
Current assets:
Cash and investments $6,465 $7,876
Trade accounts receivable, net 2,421 1,554
Other current assets 285 325
------------ ------------
Total current assets 9,171 9,755
Long-term investments and other assets 44 35
Property and equipment, net 194 213
------------ ------------
Total assets $9,409 $10,003
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities $1,966 $1,933
Deferred revenue 1,219 977
------------ ------------
Total current liabilities 3,185 2,910
Long-term liabilities - 8
Total shareholders' equity 6,224 7,085
------------ ------------
Total liabilities and shareholders'
equity $9,409 $10,003
============ ============
BackWeb Technologies Ltd.
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
Three months ended
------------------
March 31, 2006 March 31, 2005
Unaudited Unaudited
--------- ---------
Revenue:
License $791 $767
Service 865 890
-------------- --------------
Total revenue 1,656 1,657
Cost of revenue:
License 21 5
Service 240 159
-------------- --------------
Total cost of revenue 261 164
-------------- --------------
Gross profit 1,395 1,493
-------------- --------------
Operating expenses:
Research and development 582 593
Sales and marketing 1,075 725
General and administrative 605 404
-------------- --------------
Total operating expenses 2,262 1,722
-------------- --------------
Loss from operations (867) (229)
Finance and other income, net 25 (20)
-------------- --------------
Net loss $(842) $(249)
============== ==============
Net loss per share $(0.02) $(0.01)
============== ==============
Shares used in computing net loss per
share 41,143 40,881
============== ==============
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