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AXS-One Reports Fourth Quarter and Year-End Financial Results
RUTHERFORD, N.J., Feb. 10 /PRNewswire-FirstCall/ -- AXS-One Inc. (AMEX:AXO), a
leading provider of Records Compliance Management (RCM) software solutions
today announced its financial results for the fourth quarter and fiscal year
ended December 31, 2004.
Total license revenues for the fourth quarter increased 45 percent to $2.0
million from $1.4 million in the fourth quarter of 2003, and 54 percent
sequentially when compared with $1.3 million for the third quarter of 2004.
Records Compliance Management (RCM) license revenues were $1.0 million, an 8.8
percent sequential increase from those reported in the third quarter. Total
revenues for the fourth quarter were $8.9 million, a decrease of 15.2 percent,
compared with revenues of $10.4 million in the fourth quarter of 2003. Total
expenses increased 15 percent to $11.1 million compared to $9.6 million in the
fourth quarter of 2003, resulting from management's ongoing commitment to
enhance sales, marketing and research and development functions related to the
Company's RCM product strategy. The Company reported an operating loss of $2.2
million for the fourth quarter, resulting in a net loss of $1.7 million, or
$(0.06) per diluted share compared to income from operations of $830,000 in the
fourth quarter of last year and to net income of $816,000, or $0.03 per diluted
share.
The revenue decline in the fourth quarter is attributable to a decrease in
services revenue resulting from the Company's strategic shift to RCM products
and the completion in 2004 of several large enterprise implementation projects.
The Company believes that both consulting and maintenance revenues will
stabilize with the expected growth in RCM implementations going forward.
"Since I joined AXS-One in April of last year, we have focused on leveraging
the Company's core competencies in compliance, archiving and workflow to become
the leader in Records Compliance Management, which will enable us to provide
consistent and predictable growth into the future," said Bill Lyons, Chairman
and CEO of AXS-One. "As discussed in previous quarters, a priority has been to
repackage our products for a channel sales model. We delivered Version 3 of
our AXS-One Compliance Platform(TM) suite to plan and have been able to put the
quality of our solution to the test, with new customers signed in all
territories. Our relationship with Sun Microsystems was significantly expanded
to become a full blown global "Technology Development and License Agreement,"
under which Sun is marketing, licensing, selling, implementing and supporting
our entire AXS-One Compliance Platform product suite worldwide both directly
and through their global reseller network. By the time we announced this much
anticipated agreement on January 19th, we were concluding our first joint sale,
which has since been signed."
Revenues for fiscal 2004 were $38.4 million, a decrease of 3.2 percent from the
$39.7 million reported in the corresponding prior year period. License revenues
for the year increased 5.2 percent to $6.8 million from $6.4 million in 2003.
Operating expenses increased 18.5 percent to $44.0 million compared to $37.1
million reported for fiscal 2003, including $1.0 million in restructuring and
other costs. The Company reported a net loss of $5.2 million, or $(0.19) per
diluted share, compared to net income of $2.3 million, or $0.09 per diluted
share last year.
Mr. Lyons continued, "Our channel business model is firmly established, the
sales pipeline is healthy and growing and the first successes from partners
have been realized, validating our strategy. The costs associated with
expanding our management team, implementing our sales and marketing strategy,
and finalizing development of our major software offerings, AXS-One Compliance
Platform Version 3 and AXS-Link for SAP are now complete. Today, we believe
AXS-One possesses both the capital and human resources necessary to deliver
substantial operating improvements, including both licensing growth and
profitability in 2005."
Highlights from the Fourth Quarter include:
* Technology Development and Licensing Agreement signed with Sun
Microsystems. Under the terms of this agreement, Sun will market,
license, implement and support the AXS-One Compliance Platform
worldwide.
* First joint sale signed with StorageTek and formal partnership plans
in process.
* General Availability of AXS-One Compliance Platform Version 3.0
including Retention Manager, providing new functionality for
electronic Records Management. Licenses of Version 3.0 were reported
in all territories this quarter.
* General Availability of AXS-Link for SAP Version 1.5 with eight new
customer licenses across the geographies including Mantrack, Tenaga
and BPB Gypsum.
* Continued channel development with revenues coming from partners and
resellers including StorageTek, Sector and IMlogic.
The Company had $4.8 million in cash and cash equivalents at December 31, 2004,
a 63 percent increase compared to the $2.9 million reported at December 31,
2003.
Conference Call Information
Management will conduct a conference call to discuss these results at 5 p.m.
Eastern on February 10, 2005. Interested parties can participate in the call by
dialing 706-645-0399 or can access the webcast at http://www.axsone.com/. The
webcast will be archived for 30 days following the call. Interested parties
may submit questions that they would like answered during the conference call
by e-mail to . Interested parties may listen to the call via a live CCBN
webcast that will be available via the company website http://www.axsone.com/.
Interested parties should access the webcast approximately 10-15 minutes before
the scheduled start time.
About AXS-One Inc.
AXS-One (AMEX:AXO) is a leading provider of Records Compliance Management
solutions. The AXS-One Compliance Platform enables organizations to implement
secure, scalable and enforceable policies that address records management for
corporate governance, legal discovery and industry regulations such as
SEC17a-4, NASD 3010, Sarbanes-Oxley, HIPAA, The Patriot Act and Gramm-Leach
Bliley. AXS-One's technology has been critically acclaimed as best of class
and delivers digital archiving, business process management, electronic
document delivery and integrated records disposition and discovery for e-mail,
instant messaging, images, SAP and other corporate records. Founded in 1978,
and headquartered in Rutherford, NJ, AXS-One has offices worldwide including in
the United States, Australia, Singapore, United Kingdom and South Africa. For
further information, visit the AXS-One website at http://www.axsone.com/.
AXS-One, the AXS-One logo, "Access Tomorrow Today," AXSPoint, and TransAXS are
registered trademarks of, and AXS-One Compliance Platform, AXS-One Retention
Manager, "The Records Compliance Management Company," e-Cellerator, AXS Desk,
"AXS-One Collaboration FrameWorks," SMART, AXS-Link and Tivity are trademarks
of, AXS-One Inc., in the U.S. All other company and product names are
trademarks or registered trademarks of their respective companies.
Special Note Regarding Forward-Looking Statements: A number of statements
contained in this release are forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995 that involve risks and
uncertainties that could cause actual results to differ materially from those
expressed or implied in the applicable statements. These risks and
uncertainties include, but are not limited to: potential vulnerability to
technological obsolescence; the risks that its current and future products may
contain errors or defects that would be difficult and costly to detect and
correct; potential difficulties in managing growth; dependence on key
personnel; the possible impact of competitive products and pricing; and other
risks described in more detail in AXO's Securities and Exchange Commission
filings.
AXS-ONE INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
December 31, December 31,
2004 2003
ASSETS
Current assets:
Cash and cash equivalents $4,809 $2,946
Accounts receivable, net of allowance
for doubtful accounts 6,084 5,541
Due from joint venture 68 107
Prepaid expenses and other current assets 1,283 659
Total current assets 12,244 9,253
Equipment and leasehold improvements,
net of accumulated depreciation 509 336
Capitalized software development costs,
net of accumulated amortization 1,886 2,364
Other assets 142 197
Total assets $14,781 $12,150
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Current portion of long-term debt $-- $547
Accounts payable and accrued expenses 5,687 4,848
Due to joint venture 29 4
Deferred revenue 9,786 8,946
Total current liabilities 15,502 14,345
Long-term deferred revenue 303 1,504
Stockholders' deficit (1,024) (3,699)
Total liabilities and stockholders' deficit $14,781 $12,150
The unaudited financial information included in this document is intended only
as summary provided for your convenience, and should be read in conjunction
with the complete consolidated financial statements of the Company (including
the Notes thereto, which set forth important information) contained in its
Reports on Form 10-K and 10-Q filed by the Company with the U.S. Securities and
Exchange Commission (SEC). Such reports are available on the public EDGAR
electronic filing system maintained by the SEC.
This press release contains forward-looking statements. Such statements are
only predictions, and actual events or results may differ materially. All
forward-looking statements involve risks and uncertainties, including, without
limitation, the risks detailed in the Company's documents and reports
uncertainties, including, without limitation, the risks detailed in the
Company's documents and reports filed from time to time with the Securities and
Exchange Commission.
AXS-ONE INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
Three Months Ended Twelve Months Ended
December 31, December 31,
2004 2003 2004 2003
Revenues:
License fees $2,011 $1,389 $6,781 $6,443
Services 6,825 9,018 31,446 32,948
Other-related parties 28 40 209 300
Total revenues 8,864 10,447 38,436 39,691
Operating expenses:
Cost of license fees 444 434 1,923 1,524
Cost of services 4,160 4,050 17,086 15,832
Sales and marketing 2,869 1,762 9,565 7,297
Research and development 1,982 1,883 7,999 6,832
General and administrative 1,600 1,488 6,411 5,634
Restructuring and
other costs -- -- 1,020 --
Total operating expenses 11,055 9,617 44,004 37,119
Operating income (expense) (2,191) 830 (5,568) 2,572
Other income (expense):
Interest income 39 24 144 73
Interest expense -- (30) (14) (197)
Gain on sale of subsidiary -- -- -- 71
Equity in losses of
joint venture (40) (148) (162) (114)
Other income (expense), net 239 (16) 171 (188)
Other income (expense),
net 238 (170) 139 (355)
Net income (loss) before
income taxes (1,953) 660 (5,429) 2,217
Income tax benefit (expense) 227 156 217 99
Net income (loss) $(1,726) $816 $(5,212) $2,316
Basic net income (loss)
per common share $(0.06) $0.03 $(0.19) $0.09
Weighted average basic
common shares outstanding 28,293 24,995 27,395 24,945
Diluted net income (loss)
per common share $(0.06) $0.03 $(0.19) $0.09
Weighted average diluted
common shares outstanding 28,293 27,279 27,395 26,264
The unaudited financial information included in this document is intended only
as summary provided for your convenience, and should be read in conjunction
with the complete consolidated financial statements of the Company (including
the Notes thereto, which set forth important information) contained in its
Reports on Form 10-K and 10-Q filed by the Company with the U.S. Securities and
Exchange Commission (SEC). Such reports are available on the public EDGAR
electronic filing system maintained by the SEC.
This press release contains forward-looking statements. Such statements are
only predictions, and actual events or results may differ materially. All
forward-looking statements involve risks and uncertainties, including, without
limitation, the risks detailed in the Company's documents and reports
uncertainties, including, without limitation, the risks detailed in the
Company's documents and reports filed from time to time with the Securities and
Exchange Commission.
Company Contact: IR Contact:
Joseph Dwyer Matthew Hayden
AXS-One Inc. Hayden Communications
(201) 935-3400 (858) 456-4533
DATASOURCE: AXS-One Inc.
CONTACT: Joseph Dwyer of AXS-One Inc., +1-201-935-3400,
; or Investor Relations, Matthew Hayden of Hayden
Communications, +1-858-456-4533, , for AXS-One Inc.
Web site: http://www.axsone.com/