BackWeb Reports Q1 Results; Expanded Partner Activity and Investment in Personnel Position BackWeb for Growth; Q1 Results Refle
May 02 2006 - 4:02PM
Business Wire
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. -0- *T 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 ==============
============== *T
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