CAMBRIDGE,
MA — (Business Wire) — May 08, 2002— Bitstream
Inc. (NASDAQ:
BITS) today reported that revenues for the three months
ended
March 31, 2002 were $2,133,000 compared to $1,628,000 for
the three months ended March 31, 2001, an increase of $505,000
or 31.0%. Operating expenses for the three months ended March
31, 2002 were $1,896,000, a decrease of $669,000 or 26.1%
from $2,565,000 for the three months ended March 31, 2001
due primarily to decreases in expenses incurred by the Company's
Pageflex business segment. The Company's loss from operations
for the three months ended March 31, 2002 was $(178,000),
representing a decrease of $1,043,000 or 85.4% from a $(1,221,000)
loss for the three months ended March 31, 2001. The Company's
net loss for the three months ended March 31, 2002 was $(187,000),
representing a decrease of $1,071,000, or 85.1%, from a $(1,258,000)
loss for the three months ended March 31, 2001. Basic and
diluted net loss per share were $(0.02) for the three months
ended March 31, 2002, versus $(0.16) for the three months
ended March 31, 2001. The Company's cash and cash equivalent
balance at March 31, 2002 was $5,680,000, a decrease of $36,000
from the December 31, 2001 balance of $5,716,000.
"Our first quarter results are indicative
of our ongoing commitment to making Bitstream profitable on
a consolidated basis this year," said Charles Ying, Chief
Executive Officer. "Not only did revenue for our three business
segments increase as compared to Q1 2001 by an aggregate of
$505,000 or 31.0%, but we also decreased our operating expenses.
Our efforts resulted in a $1,071,000 decrease in our consolidated
net loss and a decrease of only $36,000 in cash and cash equivalents
for the quarter."
Bitstream is composed of three different
businesses: (1) its type and technology business, whose primary
revenues are generated from the licensing of font rendering
software and fonts to the embedded, set-top box, wireless
device and information appliance markets; (2) MyFonts.com,
a wholly owned subsidiary that was formed in late 1999 as
the first e-commerce site to aggregate fonts from multiple
vendors on one easy-to-use Web site ("MyFonts.com"); and (3)
Pageflex, a wholly owned subsidiary that was formed in early
1999 to establish the Company as a leader in dynamic page
composition technologies ("Pageflex"). The performance of
each business segment is discussed in greater detail below.
Type and Technology Results
Type and technology revenues for the three months ended March
31, 2002 increased $94,000 or 8.4% to $1,213,000 from $1,119,000
for the three months ended March 31, 2001. Operating expenses
for the three months ended March 31, 2002 decreased $139,000
or 12.6% to $966,000 as compared to $1,105,000 for the three
months ended March 31, 2001. Income from operations for the
Company's type and technology business segment increased $278,000
or 190% to $131,000 for the three months ended March 31, 2002
as compared to a loss of $(147,000) for the three months ended
March 31, 2001.
"We are very pleased to report that the
type and technology segment was profitable for the first quarter
of 2002," said Anna M. Chagnon, President and Chief Operating
Officer. "We are now well positioned to take advantage of
new market opportunities for our type and technology products
especially with the upcoming release of ThunderHawk, our breakthrough
browsing technology for the wireless Web."
MyFonts.com Results
MyFonts.com revenues for the three months ended March 31,
2002 increased $182,000 or 227.5% to $262,000 from $80,000
for the three months ended March 31, 2001. Revenues attributable
to this segment before elimination of intercompany royalties
due on the resale of Bitstream products for the three months
ended March 31, 2002 increased $244,000 or 236.9% to $347,000
from $103,000 for the three months ended March 31, 2001. Operating
expenses for the three months ended March 31, 2002 decreased
$17,000 or 10.1% to $151,000 from $168,000 for the three months
ended March 31, 2001. Loss from operations for the MyFonts.com
business decreased $49,000 or 32.5% to $(102,000) for the
three months ended March 31, 2002 as compared to $(151,000)
for the three months ended March 31, 2001.
"Revenue
from MyFonts.com has exceeded our projections. During
the first quarter of 2002, gross revenue for MyFonts.com
exceeded $100,000 per month," said John Collins, Vice
President and Chief Technology Officer. "We remain committed
to growing revenues by increasing the number of fonts
available from the site and increasing marketing activities.
This strategy is consistent with our goal of decreasing
net operating losses and achieving segment profitability
as soon as practicable."
Pageflex Results
Revenues from the Company's Pageflex business increased
$229,000 or 53.4% to $658,000 for the three months ended
March 31, 2002 as compared to $429,000 for the three
months ended March 31, 2001. Operating expenses for
the three months ended March 31, 2002 decreased $513,000
or 39.7% to $779,000 from $1,292,000 for the three months
ended March 31, 2001. Operating loss decreased by $716,000
or 77.6% to $(207,000) for the three months ended March
31, 2002 from $(923,000) for the three months ended
March 31, 2001.
"Our commitment to growing the Pageflex
business through sales of products rather than through
non-recurring engineering revenues is reflected in an
increase in product sales of $297,000 or 153.1% to $491,000
for the three months ended March 31, 2002, from $194,000
for the same quarter last year," said Sang Lee, Vice
President of Sales & Marketing for Pageflex. "On
a quarter-by-quarter basis, Pageflex product revenues
have steadily increased since the first quarter of 2001.
Although our October 2001 restructuring of the Pageflex
business allowed us to substantially reduce expenses,
we remain committed to being the leader in dynamic composition
technologies. As proof of this commitment, this quarter
we plan to release our groundbreaking Mpower technology,
designed to enable companies to provide their customers
with a sophisticated page layout tool, including full-featured
typography, using nothing more than a Web browser and
an Internet connection."
On Wednesday, May 8, 2002, at 2:00
p.m. EST, Bitstream will host a conference call with
the financial community to discuss its first quarter
results. Interested participants should call 1-800-283-1485
no sooner than five minutes before the call begins and
ask the operator for the Bitstream Inc. earnings release
call.
This press release may contain forward-looking
statements within the meaning of the Private Securities
Litigation Reform Act of 1995. Such statements are based
on management's current expectations. Actual performance
and results of operations may differ materially from
those projected or suggested in the forward-looking
statements due to certain risks and uncertainties, including,
without limitation, market acceptance of the Company's
products, competition and the timely introduction of
new products. Additional information concerning certain
risks and uncertainties that would cause actual results
to differ materially from those projected or suggested
in the forward-looking statements is contained in the
Company's filings with the Securities and Exchange Commission,
including Bitstream's Annual Report on Form 10-K for
the year ended December 31, 2001.
About
Bitstream Inc.
Bitstream Inc. ( Nasdaq:BITS ) is the leading developer
of font technology, digital fonts, and custom font designs.
Bitstream licenses its award-winning TrueDoc and Font
Fusion technologies to Web and application developers,
and to manufacturers of information appliances, wireless
and handheld devices, set-top boxes, embedded systems,
and printers. Setting the standard for excellence in
font technology, Bitstream holds numerous key patents
that cover the creation of portable fonts for the Internet.
Building on this experience, Bitstream is currently
developing ThunderHawk, a full-featured browser for
the wireless Web.
Pageflex
Pageflex (www.pageflexinc.com) is a leading developer
of dynamic page composition technologies for a wide
variety of markets including Web-to-print, cross-media
publishing, document customization and on-demand marketing.
Pageflex licenses its award-winning products worldwide
to Web-to-print companies, application service providers,
customer relationship management (CRM) companies, and
print service providers. The Company was established
in 1999 as a wholly owned subsidiary of Bitstream Inc.
MyFonts.com
MyFonts.com, Inc., a venture funded by Bitstream Inc.
and established as a wholly owned subsidiary in 1999,
is a showcase of the world's fonts available from one
easy-to-use Internet portal. It provides the largest
collection of fonts ever assembled for on-line delivery,
and offers easy ways to find and purchase fonts on-line,
unique typographic resources, and a forum for interacting
with font experts. For more information, visit http://www.myfonts.com,
the Web site for finding, trying, and buying fonts on
line.
Bitstream and TrueDoc are registered
trademarks and Font Fusion and ThunderHawk are trademarks
of Bitstream Inc. Pageflex, Mpower, Mpower and NuDoc
are trademarks of Pageflex, a wholly-owned subsidiary
of Bitstream Inc. MyFonts.com is a trademark of MyFonts.com,
Inc., a wholly-owned subsidiary of Bitstream Inc. All
other trademarks mentioned are for identification purposes
only and may be trademarks of their respective owners. |
|
Bitstream Inc.
Consolidated Statements of Operations (In Thousands, Except
Per Share Data)
Three Months Ended
March 31,
2002 2001
| |
|
|
2002 |
2001 |
| |
|
Revenues |
|
Software licenses
Services
|
|
|
$ 1,836
297 |
$ 1,296
332 |
| Total revenues |
|
|
2,133 |
1,628 |
| |
|
Cost of Revenues |
|
Software licenses
Services
|
|
|
312 |
200 |
| 103 |
84 |
| Total cost of revenues |
|
|
415 |
284 |
| Gross profit |
|
1,718 |
1,344 |
| |
|
Operating expenses |
|
| Selling and marketing
|
|
595 |
825 |
| Research and development
|
|
959 |
1,328 |
| General and administrative
|
|
342 |
412 |
| Total operating expenses
|
|
1,896 |
2,565 |
| |
Other income (expense): |
|
|
| |
Loss on investment |
|
|
| in DiamondSoft, Inc.
|
|
(1) |
(75) |
| Interest income, net
|
|
23 |
87 |
| Loss before income Taxes
|
|
(156) |
(1,209) |
| Provision for income
taxes |
|
31 |
49 |
| Net loss |
|
$ (187) |
$(1,258) |
| Basic and diluted net
loss per share |
|
$ (0.02) |
$ (0.16) |
| |
Basic and diluted weighted |
8,305 |
7,949 |
| |
|
Bitstream Inc. |
|
| |
|
Consolidated Balance Sheets (In
Thousands) |
|
| |
|
March 31,
2002
|
Dec. 31,
2002 |
| |
ASSETS |
|
|
| |
Current assets: |
|
|
| Cash and cash equivalents
|
|
$5,680 |
$5,716 |
| Accounts receivable,
net |
|
705 |
679 |
| Prepaid expenses and
other current assets |
|
221 |
122 |
| Total current assets
|
|
6,606 |
6,517 |
| Property and equipment,
net |
|
396 |
473 |
| Restricted cash |
|
300 |
300 |
| Goodwill, net |
|
727 |
727 |
| Investment in DiamondSoft,
Inc. |
|
598 |
599 |
| Other assets |
|
1,844 |
1,849 |
| Total assets |
|
$8,846 |
$8,839 |
| |
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
| |
Current liabilities: |
|
|
| Accounts payable |
|
$ 128 |
$ 93 |
| Accrued expenses |
|
1,159 |
1,126 |
| Current portion of deferred
revenue |
|
728 |
610 |
| Total current liabilities
|
|
2,015 |
1,829 |
| Long-term deferred revenue
|
|
30 |
14 |
| Total liabilities |
|
2,045 |
1,843 |
| Total stockholders'
equity |
|
6,801 |
6,996 |
| Total liabilities and
stockholders' equity |
|
$8,846 |
$8,839 |
|
