BakBone Software Reports First Quarter Fiscal Year 2005 Results *
BakBone Software investor relations web site www.bakbone.com SAN
DIEGO, Aug. 16 /PRNewswire-FirstCall/ -- BakBone Software (TSX:
BKB; OTC Bulletin Board: BKBOF), a global provider of data
protection software, today reported financial and operating results
for its first quarter ended June 30, 2004. (Logo:
http://www.newscom.com/cgi-bin/prnh/20031120/SDBAKLOGO) Financial
Highlights Revenues for the first quarter were $7.9 million,
compared to revenues of $5.5 million for the same period a year
ago, a 42 percent increase. Revenues consisted of $5.5 million in
licensing revenues, an increase of 22 percent over $4.5 million for
the same period a year ago, and $2.0 million in service revenues,
an increase of 102 percent over the $1.0 million reported for the
first quarter fiscal 2004. Net loss for the quarter ended June 30,
2004 was $1.0 million, or $0.02 per basic and diluted share,
compared to a net loss for the first quarter a year ago of $1.8
million, or $0.03 per basic and diluted share. In North America,
total revenues for this quarter increased 27 percent to $3.1
million from $2.4 million in Q1 fiscal 2004. Total revenues for the
Pacific Rim region increased 51 percent to $2.7 million this
quarter from $1.8 million for the quarter ended June 30, 2003. In
the EMEA region (Europe, Middle East and Africa) total revenues
grew 57 percent to $2.1 million from $1.3 million for the same
period a year earlier. "While the June quarter has historically
been a sequentially flat quarter for our business, it was a more
challenging quarter than anticipated coming into fiscal 2005," said
Keith Rickard, president and CEO. "However, our ability to
substantially grow Pacific Rim and EMEA revenues during a time when
overall IT spending in the U.S. has slowed is attributable to the
quality OEM, reseller and global solution provider relationships we
have developed worldwide. We increased our R&D spending during
the quarter and intend to continue this trend throughout fiscal
2005 as we strengthen our NetVault product and service offerings.
Our focus is long-term and our commitment is to expand BakBone's
share of the data backup and recovery market globally." Operating
expenses in the first quarter were $8.1 million as compared to $6.3
million for the same period a year ago, an increase of $1.8 million
or 29 percent. Included in first quarter general and administrative
expenses were charges totaling $774,000 consisting of $479,000
related to an abandoned public offering of the Company's securities
in the U.S., which was initiated in March of this year, as well as
additional fees paid to auditors of $295,000 pertaining to the
Company's May 2004 restatement, U.S. GAAP conversion, and its first
Form 10-K filing with the Securities and Exchange Commission in
June 2004. Excluding the $774,000 in charges related to the
abandoned public offering and audit-related items, general and
administrative expenses for the first fiscal quarter were $1.7
million, an increase of $243,000 or 17 percent as compared to
general and administrative expenses of $1.5 million during the same
quarter last year, which met the Company's expectations for the
first fiscal quarter. Overall, cash and cash equivalents decreased
$700,000 in the first quarter fiscal 2005, to $18.7 million, from
$19.4 million as of March 31, 2004. "In March of this year, we took
steps to seek a listing on the NASDAQ," stated Rickard.
"Simultaneous with our seeking shareholder approval for a reverse
stock split to achieve the $5 minimum share price criteria for a
NASDAQ listing, we also initiated the registration process to seek
funding from the capital markets to strengthen our balance sheet,
provide capital for potential acquisitions, and increase liquidity
for our stock. Due to the impact on our share price resulting from
the restatement of prior year financials, as well as current market
conditions, we have determined that we will not pursue a public
offering at this time. The Board continues to monitor the progress
of the Company closely, as well as market conditions, to identify
the next appropriate course of actions with respect to
transitioning the Company to a major U.S. exchange." "Fiscal 2005
will be a pivotal year for the Company as we leverage all resources
to increase our brand recognition, OEM and alliance partnerships,
customer adoption, and technology wins," added Rickard. "We want to
reiterate that we expect fiscal year 2005 revenues to be in the
range of $40 million to $42 million. However, in view of the
charges incurred as a result of our abandoned public offering and
additional audit-related fees, we are adjusting our EPS guidance to
$0.03 to $0.05 on a fully diluted share basis." Quarterly
Conference Call Information not covered in this press release may
be discussed in our conference call to review quarterly financial
results and business outlook. This call, scheduled for 1:30 p.m.
Pacific Time today; 4:30 p.m. Eastern Time, is available to all
investors. The telephone dial-in number to access the live call is
800-256-6003 (domestic) or 415-908-6241 (international). Call
participants are asked to dial-in 15 minutes prior to the start of
the conference call. A taped archive of the call will be available
for three days until Thursday, August 19 at 5:00 p.m. Pacific Time
at 800-633-8284 (domestic) or 402-977-9140 (international),
passcode 21205179. A real-time audio web broadcast can be accessed
at the BakBone corporate web site at http://www.bakbone.com/. For
those unable to listen to the live broadcast, the webcast will be
archived through Friday, August 27. About BakBone Software, Inc.
BakBone Software (OTC Bulletin Board: BKBOF; TSX: BKB) is a leading
international data protection solution provider that develops and
distributes data backup, restore, and disaster recovery software
for network storage and open-systems environments worldwide.
BakBone delivers scalable solutions that address the complex
demands of large enterprise environments, as well as small to
medium size businesses. Founded in 2000, BakBone products are used
by Fortune 1000 corporations and domestic and international
government entities. Distributed through a select global network of
OEM partners, resellers and solution providers, interested
companies can learn more about BakBone's products and services at
http://www.bakbone.com/ or email . Safe Harbor Statement This press
release contains forward-looking statements that involve risks,
uncertainties, assumptions and other factors, which, if they do not
materialize or prove correct, could cause BakBone's results to
differ materially from historical results, or those expressed or
implied by such forward-looking statements. All statements, other
than statements of historical fact, are statements that could be
deemed forward-looking statements, including statements containing
the words "planned," "expects," "believes," "strategy,"
"opportunity," "anticipates," and similar words. These statements
may include, among others, plans, strategies and objectives of
management for future operations; any statements regarding proposed
new products, services or developments; any statements regarding
future economic conditions or performance; statements of belief and
any statements of assumptions underlying any of the foregoing. The
potential risks and uncertainties may include, but are not limited
to, competition in our target markets; potential capital needs;
management of future growth and expansion; risk of third party
claims of infringement; protection of proprietary information,
customer acceptance of the company's products and fee structures;
the success of BakBone's brand development efforts; risks
associated with strategic alliances; reliance on distribution
channels; product concentration; need to develop new and enhanced
products; potential product defects; our ability to hire and retain
qualified employees and key management personnel; risks associated
with changes in domestic and international market conditions; and
the entry into and development of international markets for the
company's products. Our forward-looking statements should be
considered in the context of these and other risk factors disclosed
in our most recent report filed with the Securities and Exchange
Commission, which is available at http://www.sec.gov/ and our most
recent report filed with the Canadian Securities Administrators,
which can be accessed on the SEDAR disclosure system at
http://www.sedar.com/. All future written and oral forward-looking
statements made by us or on our behalf are also subject to these
factors. BakBone assumes no obligation to update any
forward-looking statement to reflect events or circumstances
arising after the date on which it was made. The accompanying
consolidated statements of operations and consolidated balance
sheets are an integral part of this announcement. Note Regarding
Use of Non-GAAP Financial Measures Certain of the information set
forth herein, including general and administrative expenses
excluding certain items, may be considered non-GAAP financial
measures. BakBone believes this information is useful to investors
because it provides a basis for measuring the company's available
capital resources, the operating performance of the company's
business and the company's cash flow, excluding non-recurring items
that would normally be included in the most directly comparable
measures calculated and presented in accordance with generally
accepted accounting principles. The company's management uses these
non-GAAP financial measures along with the most directly comparable
GAAP financial measures in evaluating the company's operating
performance and capital resources and cash flow. Non-GAAP financial
measures should not be considered in isolation from, or as a
substitute for, financial information presented in compliance with
GAAP, and non-financial measures as reported by the company may not
be comparable to similarly titled amounts reported by other
companies. BakBone, BakBone Software, NetVault, and the BakBone
logo are all trademarks or registered trademarks of BakBone
Software, Inc., in the United States and/or in other countries. All
other brands, products or service names are or may be trademarks,
registered trademarks or service marks of, and used to identify,
products or services of their respective owners. Corporate Contact:
Karen Silva Director of Investor Relations BakBone Software, Inc.
858-795-7525 BAKBONE SOFTWARE INCORPORATED CONSOLIDATED STATEMENTS
OF OPERATIONS (in thousands, except share and per share data)
(unaudited) Three months ended June 30, 2003 2004 Revenues $5,517
$7,852 Cost of revenues 796 834 Gross profit 4,721 7,018 Operating
expenses: Sales and marketing 3,563 4,004 Research and development
1,126 1,629 General and administrative 1,457 2,474 Stock-based
compensation* 153 3 Amortization of intangible assets 14 14 Total
operating expenses 6,313 8,124 Operating loss (1,592) (1,106)
Interest (expense) income , net (38) 29 Foreign exchange (loss)
gain , net (5) 106 Loss before income taxes (1,635) (971) Provision
for income taxes 128 65 Net loss $(1,763) $(1,036) Net loss per
common share: Basic and diluted $(0.03) $(0.02) Weighted-average
common shares outstanding: Basic and diluted 58,621,216 64,523,199
* Stock-based compensation includes the following: Research and
development $107 $3 General and administrative 46 -- $153 $3
BAKBONE SOFTWARE INCORPORATED CONSOLIDATED BALANCE SHEETS (in
thousands, except share data) March 31, June 30, 2004 2004
(unaudited) ASSETS Current assets: Cash and cash equivalents
$19,399 $18,699 Accounts receivable, net of allowance for doubtful
accounts of $135 and $238, respectively 7,383 6,956 Other assets
1,286 1,207 Total current assets 28,068 26,862 Property and
equipment, net 1,942 1,839 Intangible assets, net 111 97 Goodwill
4,269 4,269 Other assets 787 701 Total assets $35,177 $33,768
LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts
payable $926 $1,129 Accrued liabilities 4,078 3,764 Current portion
of deferred revenue 6,877 6,148 Total current liabilities 11,881
11,041 Deferred revenue, excluding current portion 2,930 3,583
Other liabilities 42 27 Total liabilities 14,853 14,651 Commitments
and contingencies Shareholders' equity: Series A convertible
preferred stock, no par value, 22,000,000 shares authorized,
18,000,000 shares issued and outstanding, liquidation preference of
$20,650 and $20,088, respectively 11,160 11,160 Share capital, no
par value, unlimited shares authorized, 64,526,608 and 64,527,858
shares issued and outstanding, respectively 154,916 154,917
Employee benefit trust (5) (5) Deferred compensation (12) (9)
Accumulated deficit (145,475) (146,511) Accumulated other
comprehensive loss (260) (435) Total shareholders' equity 20,324
19,117 Total liabilities and shareholders' equity $35,177 $33,768
http://www.newscom.com/cgi-bin/prnh/20031120/SDBAKLOGO
http://photoarchive.ap.org/ DATASOURCE: BakBone Software, Inc.
CONTACT: Karen Silva, Director of Investor Relations of BakBone
Software, Inc., +1-858-795-7525, Web site: http://www.bakbone.com/
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