Industri-Matematik International Announces Second Quarter 2003 Results

Industri-Matematik International Announces Second Quarter 2003 Results MT. LAUREL, New Jersey - November 19, 2002 - Industri-Matematik International Corp. (Nasdaq: IMIC) - the Order Company - today announced results for its second fiscal quarter ended October 31, 2002. Revenues for the three months ended October 31, 2002 were $13.3 million as compared to $15.3 million for the same period in fiscal 2002. License revenue was $0.5 million as compared to $1.9 million a year earlier, and service and maintenance revenue was $12.5 million as compared to $12.8 million in the prior year. The reported net loss for the three months ended October 31, 2002 was $5.8 million, or $0.18 per share (including the restructuring charge referred to below of $0.12 per share). For the corresponding quarter a year earlier the Company had a net loss of $0.8 million, or $0.02 per share. The second fiscal quarter results do not include any material expenses related to the tender offer referred to below. On October 10, 2002, the Company announced a restructuring designed to substantially reduce costs by approximately $2.0 million per quarter. As a result of these expense reductions, management believes that the Company will achieve break-even operating results (excluding any acquisition related charges) on a quarterly basis in the fourth quarter of fiscal year 2003 (ending April 30, 2003). The restructuring has resulted in a charge of $3.8 million, which has been recorded in the second quarter of fiscal year 2003. As of October 31, 2002, $3.7 million of that amount remains as a liability and has not yet been paid. The Company anticipates that approximately $1.7 million and $1.2 million of that amount will be paid in the third and fourth quarters of fiscal year 2003, respectively. The remaining amount of $0.8 million will be paid in fiscal year 2004. Revenues for the six-months ended October 31, 2002 were $23.8 as compared to $28.8 million for the same period last year. License revenue for the six-months ended October 31, 2002 was $0.8 million as compared to $2.6 million a year earlier. Service and maintenance revenue was $22.3 million for the six-months ended October 31, 2002 as compared to $25.0 million a year earlier. For the six-months ended October 31, 2002 the Company had a net loss of $10.2 million, or $0.32 per share (including the restructuring charge referred to above of $0.12 per share) as compared to $2.2 million, or $0.07 per share, during the same period last year. "During the second quarter we continued to focus our efforts on creating value for our customers. Before the restructuring charge, our operating results improved as compared to last quarter and this is proof that our customers value our products and services", said Lin Johnstone, President and Chief Executive Officer of Industri-Matematik. On November 4, 2002, the Company announced that it entered into a definitive merger agreement with certain subsidiaries of Symphony Technology Group. On November 12, 2002, pursuant to the merger agreement, STG OMS Acquisition Corp. launched a tender offer to purchase all of the outstanding shares of the Company's Common Stock for a purchase price of $.35 per share, net to the seller, in cash, subject to certain conditions including the condition that at least 65% of the Company's outstanding shares are tendered. The tender offer is scheduled to expire at midnight, New York City time, on December 10, 2002, unless extended. The complete terms and conditions of the offer are set forth in the Offer to Purchase, copies of which are available by contacting the information agent, D.F. King & Co., Inc., at (800) 735-3591. If less than all of the outstanding shares are acquired in the offer, the remaining shares will be acquired in a second step merger. Management will host a conference call to discuss the Company's results for the second quarter of fiscal 2003 at 10:30 a.m. Eastern Time, today, November 19, 2002. To participate in the call, dial (800) 553-0351 in the U.S. or +1 (612) 332-0523 from outside the U.S. This information is also available at the Industri-Matematik site on the World Wide Web at: http:// www.industri-matematik.com. About Industri-Matematik Industri-Matematik International - The Order Company - is a provider of high-performance supply chain solutions for the retail value chain which turn supply chain friction into smooth order flows. Its software enables companies to manage order and replenishment business processes based on actual customer demand to enable best-in-class, pull-driven supply chain practices. The Company's software includes collaborative order management, fulfillment, customer relationship management (CRM), distribution center and store replenishment, supply chain analytics, visibility, and event management capabilities. Industri-Matematik customers cover the entire retail value chain from manufacturers to logistics and business service providers to wholesalers and retailers. They include some of the world's leading brands such as AstraZeneca, British Airways, Campbell Soup, Canadian Tire, Foster's, Kellogg's, Royal Ahold, Schenker, Starbucks, Flextronics, TNT Express, and Warner/Elektra/Atlantic. # # # The statements contained in this release that are not historical facts contain forward-looking information with respect to plans, projections or future performance of Industri-Matematik and further versions of its software products, the achievements of which involve certain risks and uncertainties, including, but not limited to, the success of its reorganization, product demand and market acceptance risks, the effect of economic conditions particularly in its target markets, the impact of competitive products and pricing, product development, commercialization and technological difficulties, and other uncertainties detailed in Industri-Matematik's filings with the Securities and Exchange Commission, particularly its Annual Report on Form 10-K filed in July 2002. The information in this release is as of November 19, 2002. Industri-Matematik undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in its expectations. For Industri-Matematik company and product information, and press releases, please access the Industri-Matematik site on the World Wide Web at: http:// www.industri-matematik.com For more information, contact: Industri-Matematik International Corp., Mt. Laurel, NJ Lin Johnstone (CEO) or Sue Salvesen (CFO) at: ir@im.se Phone US: +1-856-793-3269 Phone Europe: +46-8-676-5696 - tables to follow - INDUSTRI-MATEMATIK INTERNATIONAL CORP. AND SUBSIDIARIES Condensed Consolidated Statements of Operations (Unaudited) (U.S. Dollars in thousands, except share and per share data) Three Six Months Months Ended Ended 10/31/02 10/31/01 10/31/02 10/31/01 Revenues: Licenses $ 534 $ 1,948 $ 811 $ 2,590 Services and 12,470 12,785 22,295 24,973 maintenance Other 340 616 693 1,274 Total revenues 13,344 15,349 23,799 28,837 Cost of revenues: Licenses 158 120 318 136 Services and 6,984 8,294 13,631 16,579 maintenance Other 146 303 379 467 Total cost of 7,288 8,717 14,328 17,182 revenues Gross profit 6,056 6,632 9,471 11,655 Operating expenses: Product 3,296 2,838 5,800 5,331 development Sales and 2,404 2,540 4,763 4,703 marketing General and 2,169 1,830 4,983 3,685 administrative Amortization of 0 185 0 370 goodwill and other intangible assets Restructuring 3,816 0 3,816 0 costs Total operating 11,685 7,393 19,362 14,089 expenses Loss from (5,629) (761) (9,891) (2,434) operations Other income (expense): Interest income 86 158 202 403 Interest expense (1) 0 (1) 0 Miscellaneous (34) (193) (311) (210) income (expense) Loss before income (5,578) (796) (10,001) (2,241) taxes Provision for (177) 0 (177) 0 income taxes Net loss $ (5,755) $ (796) $ (10,178) $ (2,241) Net loss per share ($0.18) ($0.02) ($0.32) ($0.07) - assuming dilution Weighted average number of shares 31 952 32 303 31 966 32 303 outstanding - 654 436 883 436 assuming dilution INDUSTRI-MATEMATIK INTERNATIONAL CORP. AND SUBSIDIARIES Condensed Consolidated Balance Sheets (U.S. Dollars in thousands) 10/31/02 04/30/02 (unaudited) ASSETS Current assets: Cash and cash equivalents $ 10,472 $ 16,422 Accounts receivable, less allowance for doubtful accounts 8,337 7,953 Accrued income 2,314 2,218 Prepaid expenses 2,355 1,688 Income taxes receivable 0 3 Other current assets 313 384 Total current assets 23,791 28,668 Non-current assets: Property and equipment, net 2,655 3,135 Goodwill and other intangible assets 3,119 2,989 Long-term cash deposit 2,822 2,728 Other non-current assets 427 889 Total non-current assets 9,023 9,741 Total assets $ 32,814 $ 38,409 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 1,748 $ 1,341 Accrued expenses and other current 7,779 6,136 liabilities Accrued payroll and employee benefits 7,180 4,562 Deferred revenue 5,004 5,148 Total current liabilities 21,711 17,187 Long-term liabilities: Accrued pension liability 1,990 2,093 Other long-term liabilities 113 153 Total long-term liabilities 2,103 2,246 Total liabilities 23,814 19,433 Stockholders' equity: Common Stock 320 319 Additional paid-in capital 120,860 120,849 Accumulated deficit (104,802) (94,623) Accumulated other comprehensive loss (5,924) (6,214) Note receivable from stockholders (1,454) (1,355) Total stockholders' equity 9,000 18,976 Total liabilities and stockholders' $ 32,814 $ 38,409 equity ------------------------------------------------------------ This information was brought to you by Waymaker http://www.waymaker.net The following files are available for download: http://www.waymaker.net/bitonline/2002/11/19/20021119BIT00560/wkr0001.doc http://www.waymaker.net/bitonline/2002/11/19/20021119BIT00560/wkr0002.pdf