Ad-hoc | 10 November 1998 08:53

Ad hoc-Service: BETA Systems Software AG english

—————————————————————— Ad hoc-Service: BETA Systems Software AG english Mitteilung gemäß Paragraph 15 WpHG übermittelt von der DGAP. Für den Inhalt der Mitteilung ist allein der Emittent verantwortlich. —————————————————————————— english version For Immediate Release BETA Systems Software AG, Berlin, November 10, 1998 BETA Systems Software AG announces Preliminary Third Quarter and Nine Month 1998 Results – Third quarter revenues up DM 1.1 million (+6.3%), nine month revenues up DM 7.7 million (+18.2%) – Third quarter and nine month net income after adjustment for a one-time severance charge approximately equal to 1997 levels – Nine month new license revenues up 40%, CPU upgrade revenues up 88% Berlin, Germany, November 10, 1998. BETA Systems Software AG announces preliminary results of operations for the third quarter and nine months ended September 30, 1998. Revenues for the third quarter were DM 18.7 million, an increase of DM 1.1 million, or 6.3% over the third quarter of 1997. Adjusted for a one-time severance charge of DM 1.4 million, the company’s pre-tax income was DM 2.1 million (DM 0.7 million as reported) compared to pre-tax income of DM 2.4 million in the comparable quarter of the prior year. Adjusted net income was DM 1.0 million, or DM 0.29 per share, (DM 0.4 million or DM 0.11 per share as reported) compared to a net income of DM 1.1 million, or DM 0.29 per share in the third quarter 1997. For the nine month period, revenues were DM 49.6 million, an increase of DM 7.7 million, or 18.2% over the 1997 nine month period. The company’s adjusted pre-tax loss was DM (0.7) million [DM (2.2) million as reported] compared to a pre-tax loss of DM (0.7) million in the 1997 period. The adjusted net loss for the 1998 period was DM (0.3) million, or DM (0.09) per share, [DM (1.0) million, or DM (0.28) per share as reported] compared to a net loss of DM (0.4) million, or DM (0.14) per share in the nine month period 1997. The revenue increase during the third quarter resulted primarily from an increase in maintenance and services revenues (+14%). License revenues in the third quarter were approximately equal to the third quarter of 1997. As expected, revenues from version upgrades were significantly lower as compared to the third quarter of 1997 (-75%) as customers completed the migration process from version 2 to version 3 of BETA 92 and BETA 93. This decline was partially offset by, firstly, strong growth in revenues from CPU upgrades (+80%) reflecting a significant increase in customers’ computing capacity and, secondly, but to a lesser extent, sales of new licenses (+12%). BETA Systems has met its demanding targets in Germany and especially in the USA. In Russia, Eastern Europe and South America unstable economic conditions negatively impacted BETA’s expansion in those areas. In addition, new license revenues were adversely affected by delays in the product development of BETA 42 (Process Management) and BETA 51 (Storage Management). The decline in the Company’s pre-tax income as compared to expectations and results of the third quarter of 1997 was mainly caused by the aforementioned slower growth in new license revenue and the one-time severance charge of DM 1.4 million. Based on the nine month results, BETA Systems has revised its 1998 revenue forecast downward by 4-5% and expects full year pre-tax income to be impacted accordingly. In discussing the results, Christiane Hotz-Firlus, Chief Financial Officer commented: ‘The lower growth in license revenues is very disappointing and has forced us to revise our targets for the year. The revenue contribution by certain countries is taking longer than originally expected. We’ve started to take the necessary measures to align our sales efforts with current market conditions.’ In a separate matter, BETA Systems has re-evaluated its original plan to acquire QMaster Software Solutions. BETA Systems has agreed upon an OEM agreement under which the Company will market QMaster’s UNIX and NT-based process and document management software. In doing so, BETA Systems will gain access to valuable technology without the dilutive effect of the proposed cash acquisition. BETA Systems plans to release its final results for the 1998 third quarter on November 24, 1998. Forward-looking statements: Investors are cautioned that forward-looking statements in this report concerning future expectations involve both risks and uncertainty. Various important factors could cause actual results to differ materially from those expressed or implied by the statement above including, among others, changes in general economic and business conditions, fluctuating exchange rates, and other factors discussed above. Many of these factors are macroeconomic in nature and therefore beyond the control of management. BETA Systems Software AG does not assume any obligation to update those forward-looking statements. Berlin, Germany, November 10, 1998 Your contact: Matthias Poth Manager Investor Relations BETA Systems Software AG Alt Moabit 97a, D-10559 Berlin Telefon: 030/399 26-158, Fax: 030/399 26-289 Ende der Mitteilung