BackWeb Achieves Significant Q3 Year-over-Year Revenue Gain; Q3 2005 Marks Third Consecutive Quarter of Improved Revenue and Net
02 November 2005 - 1:00PM
Business Wire
BackWeb Technologies Ltd. (Nasdaq: BWEB), a leading provider of
offline and mobile web software, today reported financial results
for its third quarter and nine months ended September 30, 2005.
BackWeb(R) reported Q3 2005 revenue increased 51% to $1.78 million
compared to $1.18 million in the third quarter of 2004 and revenue
of $1.72 million, or 4%, in the second quarter of 2005. Higher
license revenues in particular, as well as continued strength in
services, drove the third quarter revenue increase. License sales
in the period included significant new and follow-on orders from
Centocor, Dade Behring, Pfizer and Siemens AG's Communications
Group. BackWeb continued its expense management discipline,
reporting a reduced net loss of $208,000, or $0.01 per share, for
Q3 2005, compared to a net loss of $1.54 million, or $0.04 per
share, in Q3 2004, and a net loss of $233,000, or $0.01 per share,
in Q2 2005. For the first nine months of 2005, BackWeb's revenue
rose 30% to $5.16 million compared to $3.97 million in the first
nine months of 2004. BackWeb reported a significantly lower net
loss of $688,000, or $0.02 per share, for the first nine months of
2005, compared to a net loss of $4.23 million, or $0.10 per share,
in the first nine months of 2004. BackWeb's balance sheet and cash
position continue to remain solid, with no long-term debt and cash
and investments totaling approximately $8.62 million as of
September 30, 2005. BackWeb's Vice President Finance, Ken Holmes,
commented, "The third quarter was our strongest period of license
revenue recognition in three years and reflects customers who are
either expanding existing deployments or bringing BackWeb's value
to other new applications." BackWeb's CEO, Bill Heye, commented,
"Our Q3 success reflects progress in both revenue growth and
expense management toward our goal of sustainable profitability. We
believe that current market dynamics are driving greater demand for
the mobilization of key enterprise web applications. In an effort
to accelerate our revenue ramp in coming quarters, we recently
expanded our senior management team with the appointments of two
proven industry executives to head worldwide sales and marketing
and business development. Already, we are seeing the benefit of
their contributions as they expand our sales outreach and work
toward new partnering opportunities. While these additions, as well
as the planned ramp in sales, marketing and partnering activity
will moderately increase our expenses going forward, we believe the
growing opportunities for mobile software justify these investments
at this time." Mr. Heye concluded, "Also supporting our sales and
marketing effort is a growing base of customers who have achieved
successful deployments of our solutions, some with deployments
exceeding 10,000 users. A number of our customers have already
returned to BackWeb to expand their original deployments or to
deploy our mobility solutions in new applications or divisions.
Additionally, our partnership with Oracle's PeopleSoft(R)
Enterprise ePerformance application is gaining traction and
contributed to an important business win in the recent quarter.
Expanding our base of partnerships of this type is a major focus of
our company, and we hope to demonstrate more progress in this area
in the coming quarters." About BackWeb Technologies: BackWeb
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, and Rosh Ha 'ayin, Israel with field
offices in New York and Europe. Make every minute of your mobile
professional's day productive; visit www.backweb.com or call (877)
222-5932. (C) 2005 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. 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
statements regarding: BackWeb's ability to achieve sustainable
profitability; the expected contributions to our business of
BackWeb's new officers; our planned increase in sales, marketing
and partnering activity and the resulting expected increase to our
expenses; and our efforts to expand our partnership base. 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
ability of BackWeb's new and existing sales personnel to
effectively transition to the new sales execution model; 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
June 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. -0-
*T BackWeb Technologies Ltd. Condensed Consolidated Balance Sheets
(in thousands) September 30, December 31, 2005 2004 Unaudited
------------- ASSETS Current assets: Cash and investments $ 8,617
$10,320 Trade accounts receivable, net 1,145 1,677 Other current
assets 298 378 ------------- ------------- Total current assets
10,060 12,375 Long-term investments and other assets 33 26 Property
and equipment, net 206 154 ------------- ------------- Total assets
$10,299 $12,555 ============= ============= LIABILITIES AND
SHAREHOLDERS' EQUITY Current liabilities: Accounts payable and
accrued liabilities $ 1,779 $ 1,800 Deferred revenue 1,121 2,672
------------- ------------- Total current liabilities 2,900 4,472
Long-term liabilities 21 145 Total shareholders' equity 7,378 7,938
------------- ------------- Total liabilities and shareholders'
equity $10,299 $12,555 ============= ============= *T -0- *T
BackWeb Technologies Ltd. Condensed Consolidated Statements of
Operations (in thousands, except per share data) Three months ended
Nine months ended ------------------- ------------------- September
September September September 30, 2005 30, 2004 30, 2005 30, 2004
Unaudited Unaudited Unaudited Unaudited --------- ---------
--------- --------- Revenue: License $ 942 $ 124 $ 2,569 $ 1,043
Service 840 1,057 2,588 2,923 --------- --------- ---------
--------- Total revenue 1,782 1,181 5,157 3,966 Cost of revenue:
License 14 12 27 53 Service 183 347 533 960 --------- ---------
--------- --------- Total cost of revenue 197 360 560 1,013
--------- --------- --------- --------- Gross profit 1,585 821
4,597 2,953 --------- --------- --------- --------- Operating
expenses: Research and development 530 768 1,670 2,527 Sales and
marketing 787 1,236 2,317 3,273 General and administrative 511 423
1,359 1,533 --------- --------- --------- --------- Total operating
expenses 1,828 2,427 5,346 7,333 --------- --------- ---------
--------- Loss from operations (243) (1,606) (749) (4,380) Finance
and other income, net 35 68 61 149 --------- --------- ---------
--------- Net loss $ (208) $ (1,538) $ (688) $ (4,231) =========
========= ========= ========= Net loss per share $ (0.01) $ (0.04)
$ (0.02) $ (0.10) ========= ========= ========= ========= Shares
used in computing net loss per share 41,036 40,717 40,971 40,669
========= ========= ========= ========= *T
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