Neoware (NASDAQ:NWRE)
Historical Stock Chart
From Aug 2019 to Aug 2024
![Click Here for more Neoware Charts. Click Here for more Neoware Charts.](/p.php?pid=staticchart&s=N%5ENWRE&p=8&t=15)
Neoware Reports Fiscal 2004 First Quarter Revenue and Earnings
Record Gross Margins and Record First Quarter Revenue and Net Income
KING OF PRUSSIA, Pa., Oct. 27 /PRNewswire-FirstCall/ -- Neoware Systems, Inc. ,
the leading supplier of software and thin client appliances, today reported
strong financial results for its fiscal 2004 first quarter ended September 30,
2003.
FINANCIAL HIGHLIGHTS
-- Revenues increased 11% to $15,013,387, a record for the first
quarter, from $13,516,678 in the prior year quarter, which previously
was the highest first quarter in the company's history. The year ago
quarter included $1.5 million of revenue from lower gross margin
products acquired in the NCD acquisition which have subsequently been
phased out.
-- Gross margin increased to a record 53% from 42% in the prior year
quarter. Gross margin increased as a result of lower product costs on
higher revenues, as well as a larger percentage of revenues from
software sales.
-- Operating income increased 30% to $2,820,694 from $2,170,963, and
represented 19% of revenues, up from 16% of revenues in the prior
year quarter.
-- Net income increased 29% to $1,863,353, or $.12 per diluted share,
compared to net income of $ 1,447,031, or $.10 per diluted share a
year ago, on approximately 1.5 million additional shares in the
current period.
-- Cash and marketable securities increased to $45,663,869 at September
30, 2003 from $29,164,875 at June 30, 2003, as a result of positive
cash flow from operations and a private placement of common stock in
July 2003, offset by the acquisition of the TeemTalk product line.
"Neoware continues to deliver superior financial results, with record gross
margins and record first quarter revenues and earnings," stated Michael
Kantrowitz, Neoware's Chairman and CEO. "We are a major participant in the
growing thin client appliance market, with a strong competitive position and a
proven, software-focused business model. We are very well positioned to
continue to build our business, both organically and through carefully chosen
acquisitions, particularly with the additional cash resources from our equity
financing in July," Mr. Kantrowitz continued.
CUSTOMER HIGHLIGHTS
-- Customers in the quarter included Autozone, Art Van Furniture,
Austrian Army, Badcock Home Furnishings, Bed, Bath and Beyond,
California DMV, Canada Life, Cook County, Electrolux, French Army,
Ikea, Kroger, Luxembourg Ministry of Taxes, Mission St. Joseph
Hospitals, Pearle Vision Centers, Raymour and Flanigan Furniture,
Royal Jordanian Airways and Siemens Medical Systems.
"Software products, including software upgrades for Neoware and IBM thin
clients, as well as our new ThinPC and TeemTalk products, contributed
significantly to the Company's gross profit margin this quarter - more than any
prior period, and more than we projected," Mr. Kantrowitz continued. "As a
result, our overall gross margins were well above our expectations and guidance,
which provides us with significant flexibility moving forward."
"Neoware is now the number two supplier of thin client appliances and a leading
provider of the software that enables thin clients and personal computers to
provide on-demand access to legacy applications, with increased desktop
security, improved reliability, and lower up-front and ongoing costs. Our
customers recognize the benefits of Neoware's thin client products and of the
superior service that we are delivering, and these benefits are driving the
results we are reporting today," Mr. Kantrowitz concluded.
CONFERENCE CALL INFORMATION
In connection with this release, management of Neoware will host a conference
call at 5:00 PM Eastern Time on October 27, 2003. The conference call will be
available live via the Internet on Vcall at http://www.vcall.com/ and on the
Neoware website at http://www.neoware.com/. To participate, go to the website
10 minutes prior to the call to register, download and install any necessary
audio software. If you are unable to attend the live conference call, an
Internet replay of the call will be archived and available after the call. A
copy of the Company's press release announcing its earnings and any other
material financial and statistical information about the period to be presented
in the conference call will be available at the section of the Company's website
entitled "Investor" at http://www.neoware.com/.
The call will also be accessible by dialing 1.877.679.9049 for domestic calls
and +1.952.556.2803 for international calls. A replay of the call will be
available through November 10, 2003 by dialing 1.800.615.3210 domestically and
+703.326.3020 internationally. The conference access code is 283555.
About Neoware
Neoware provides software, services, and solutions to enable Appliance
Computing, a proven Internet-based computing architecture targeted at business
customers, that is designed to be simpler and easier than traditional PC-based
computing. Neoware's software and management tools power and manage a new
generation of smart computing appliances that utilize the benefits of open,
industry-standard technologies to create new alternatives to personal computers
used in business and a wide variety of proprietary business devices.
Neoware's products are designed to run local applications for specific vertical
markets, plus allow access across a network to multi-user Windows servers, Linux
servers, mainframes, minicomputers, and the Internet. Computing appliances that
run and are managed by Neoware's software offer the cost benefits of
industry-standard hardware and software, easier installation, and have lower
up-front, maintenance, and administrative costs than proprietary or PC-based
alternatives.
More information about Neoware can be found on the Web at
http://www.neoware.com/ or via email at . Neoware is based in King of Prussia,
PA.
This press release contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995, including statements
regarding: our continued superior financial results; the growing thin client
appliance market; our expectation of the growth of our business, organically and
through acquisitions; our flexibility in our future operations; customer
recognition of the benefits of our products and services driving our results;
and the cost-saving benefits of our products to our customers. These forward-
looking statements involve risks and uncertainties. Factors that could cause
actual results to differ materially from those predicted in such forward-
looking statements include, the timing and receipt of future orders, our timely
development and customers' acceptance of our products, pricing pressures, rapid
technological changes in the industry, growth of the Appliance Computing market,
increased competition, our ability to attract and retain qualified personnel,
adverse changes in customer order patterns, our ability to identify and
successfully consummate and integrate future acquisitions, our ability to
successfully sell our securities, adverse changes in general economic
conditions in the U. S. and internationally, risks associated with foreign
operations and political and economic uncertainties associated with current
world events. These and other risks are detailed from time to time in Neoware's
periodic reports filed with the Securities and Exchange Commission, including,
but not limited to, its reports on Form 10-K for the year ended June 30, 2003.
Neoware, ThinPC, and TeemTalk are trademarks of Neoware Systems, Inc. All other
names products and services are trademarks or registered trademarks of their
respective holders.
NEOWARE SYSTEMS, INC.
CONSOLIDATED BALANCE SHEETS
ASSETS September 30, 2003 June 30, 2003
CURRENT ASSETS:
Cash and cash equivalents $27,285,394 $26,013,555
Marketable securities 18,378,475 3,151,320
Accounts receivable, net 9,692,651 11,088,994
Inventories 1,562,912 772,494
Prepaid expenses and other 680,953 798,383
Deferred income taxes 945,585 945,585
Total current assets 58,545,970 42,770,331
Property and equipment, net 629,310 572,048
Goodwill 16,955,950 8,943,175
Intangibles, net 3,928,837 2,090,617
Other 71,535 -
$80,131,603 $54,376,171
LIABILITIES AND
STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $1,943,099 $4,206,346
Accrued expenses 3,476,359 2,817,791
Capital lease obligations 6,738 6,557
Deferred revenue 830,430 691,614
Total current liabilities 6,256,626 7,722,308
Capital lease obligations,
non-current portion 8,497 10,252
Deferred income taxes 16,788 16,788
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Common stock 15,729 14,056
Additional paid-in capital 69,559,207 44,214,516
Treasury stock (100,000) (100,000)
Accumulated other
comprehensive income (13,792) (26,943)
Retained earnings (deficit) 4,388,547 2,525,194
Total stockholders' equity 73,849,692 46,626,823
$80,131,603 $54,376,171
NEOWARE SYSTEMS, INC
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended Three Months Ended
September 30, September 30,
2003 2002
Net revenues $15,013,387 $13,516,678
Cost of revenues 7,049,231 7,822,502
Gross profit 7,964,156 5,694,176
Sales and marketing 2,965,305 2,227,333
Research and development 721,080 387,763
General and administrative 1,457,077 908,117
Operating expenses 5,143,462 3,523,213
Operating income 2,820,694 2,170,963
Interest income, net 83,318 90,023
Income before income taxes 2,904,012 2,260,986
Income tax expense (1,040,659) (813,955)
Net income $1,863,353 $1,447,031
Basic income per share $ 0.12 $ 0.11
Diluted income per share $ 0.12 $ 0.10
Weighted average number of common
shares outstanding used in basic
earnings per share computation 15,445,492 13,162,589
Weighted average number of common
shares outstanding used in diluted
earnings per share computation 16,200,219 14,652,096
NEOWARE SYSTEMS, INC
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Three Months
Ended Ended
September 30, September 30,
2003 2002
CASH FLOWS FROM
OPERATING ACTIVITIES:
Net income $1,863,353 $1,447,031
Adjustments to reconcile
net income to net cash
provided by operating
activities-
Deferred income taxes - 799,136
Depreciation and amortization 289,100 187,509
Changes in operating
assets and liabilities-
(Increase) decrease in:
Accounts receivable 1,396,343 (667,572)
Inventories (790,418) 319,420
Prepaid expenses and other 45,895 (120,114)
Increase (decrease) in:
Accounts payable (2,263,247) (177,103)
Accrued expenses 658,568 (116,834)
Deferred revenue 138,816 131,861
Net cash provided by
operating activities 1,338,410 1,803,334
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of Pericom UK (9,970,043) -
Purchase of intangible assets (117,733) (29,652)
Purchases of property
and equipment, net (109,581) (62,378)
Net cash used in
investing activities (10,197,357) (92,030)
CASH FLOWS FROM
FINANCING ACTIVITIES:
Repayments of capital leases (1,574) (15,183)
Exercise of stock
options and warrants 737,062 1,444,273
Private placement,
net of expenses 24,609,302 -
Expenses for prior
issuance of common stock - (118,940)
Repayments of officer loans - 9,463
Net cash provided by
financing activities 25,344,790 1,319,613
EFFECT OF EXCHANGE RATE
CHANGES ON CASH 13,151 -
INCREASE IN CASH AND
CASH EQUIVALENTS 16,498,994 3,030,917
CASH AND CASH EQUIVALENTS,
BEGINNING OF PERIOD 29,164,875 17,031,422
CASH AND CASH EQUIVALENTS,
END OF PERIOD $45,663,869 $20,062,339
SUPPLEMENTAL DISCLOSURES:
Cash paid for income taxes $264,400 $54,180
Cash paid for interest 3,570 8,918
Cash received for interest 57,742 88,276
DATASOURCE: Neoware Systems, Inc.
CONTACT: Investor Relations: Kevin McGrath of Cameron Associates,
+1-212-245-8000, x 203, , or Keith Schneck, CFO of
Neoware Systems, +1-610-277-8300,
Web site: http://www.neoware.com/