EDMOND, Okla. May 4, 2000 (PRIMEZONE) -- The viaLink Company (Nasdaq:VLNK) today reported financial and operating results for the first quarter ended March 31, 2000. The company reported revenues of $407,000, representing a 277 percent increase from the first quarter 1999 and 57 percent increase from the fourth quarter 1999.
Net loss for the three-month period was $11.2 million, or ($0.57) per share. The first quarter 2000 net loss includes $3.4 million in non-cash interest and stock compensation expense, including expense related to warrants issued to Ernst & Young and i2 Technologies, Inc. in 1999 and options issued to employees and service providers. During the first quarter 2000, viaLink reported a loss from operations of approximately $10.2 million compared to a loss from operations of $1.7 million during the first quarter of 1999. The company reported that the first quarter results were consistent with its expectations and reflected increased infrastructure spending to support the company's strategy to become the industry accepted utility for synchronizing item, price and promotion information.
Lewis B. "Bucky" Kilbourne, chairman and chief executive officer of viaLink, reported that the company achieved several key objectives during and subsequent to the first quarter. These accomplishments included:
-- Industry Initiatives. The company is working as an architect partner with UCCnet, a standards-based electronic trading community being established for the CPG industry. In addition, the company was selected to participate in a new online exchange being created by the Food Marketing Institute (FMI) and Food Distributors International (FDI). Other participants selected by the FMI and FDI exchange include IBM, i2 Technologies and Ariba. "viaLink's selection along with industry leaders like IBM, i2 and Ariba further demonstrates the importance of our foundational services to industry e-commerce initiatives," said Kilbourne. "Synchronization is a key element for online exchanges and we believe viaLink has the only deployed solution for synchronization in the CPG and grocery industry."
-- Customers. During the quarter, viaLink added Spartan Stores, Inc., a $3 billion wholesaler and retailer located in the upper Midwest, to its growing customer base. The company reported that it currently has 629 customers, including 420 Coors distributors. Programs with Coors Brewing and Kraft Foods are progressing on schedule and Kraft has been working with viaLink to expand the reach of its e-commerce platform across the retailers with whom Kraft conducts business.
"Our strategy is to focus our sales efforts on leading national and regional retailers and suppliers. Because these companies are in the early stages of implementing their e-commerce strategies, this approach has resulted in a longer sales cycle than our original expectations. However, we believe adoption by these leading companies will be an important endorsement for the rest of the industry. Our potential customer pipeline remains full and we believe our increased marketing activities have significantly enhanced the visibility of our services within the industry," stated Kilbourne.
-- Alliances. During the quarter, the company launched the viaLink ready Program to enable third-party technology, solution and service providers to connect to our services. The program, which has 24 members, allows participants to create and deploy solutions that use viaLink's syncLink(tm) service and extend the capabilities of their own applications. viaLink is using XML as the preferred method of interface with its viaLink ready Program members. Most recent additions to the viaLink ready Program include 1-800-DATABASE, efficient market services, inc. (ems) and Gelco Information Network.
"The viaLink ready Program demonstrates our commitment to bring together leading solution providers to create value for our customers. We believe this program is the quickest and most cost effective way to accelerate e-commerce solutions to market and we continue to target additional program members," added Kilbourne.
-- International Expansion. Subsequent to quarter end, viaLink signed a memorandum of understanding with MediaC, a subsidiary of Daewoo Information Systems Co., Ltd. The companies plan to work together to establish a licensing arrangement allowing MediaC to customize and market viaLink's services in Korea. "These discussions represent an initial step in viaLink's efforts to establish a global presence," stated Kilbourne. "Expanding internationally is an important part of our business strategy."
-- Product development. viaLink continued to enhance the functionality and product specification features for syncLink. Additionally, viaLink's Scan Based Trading service is being prepared for rollout after completion of the Grocery Manufacturers of America (GMA) pilot program. Results of the GMA program are expected to be announced in June of this year.
"We believe our Scan Based Trading service facilitates one of the most progressive ways of doing business in the grocery industry and offers broad benefits for both retailers and suppliers. We plan a full roll out of this service following the GMA pilot," said Kilbourne.
-- Liquidity. At March 31, 2000, the company reported cash and short-term investments totaling more than $13.7 million. During the quarter, the company increased its capital base by issuing $6.0 million of common stock to Hewlett Packard, i2 Technologies, Inc. and Millennium Partners, L.L.C. The company also filed a registration statement with the Securities and Exchange Commission for a follow-on offering of its common stock.
"We have made significant strides in obtaining the working capital we need to execute our business plan and expand our operations. In addition to our public offering, we continue to evaluate private sources of capital to meet our growth objectives," added Kilbourne.
"Our primary focus is to build critical mass," said Kilbourne. "The recent expansion of our alliance programs and significant efforts with major industry associations continue to enhance our profile and visibility in the marketplace. Business-to-business e-commerce has moved to the forefront of the consumer packaged goods industry and we believe our deployed solution, supported by our deep industry expertise and knowledge, is foundational to executing any business-to-business e-commerce strategy in this industry.
"Our pipeline of potential customers continues to grow, including opportunities internationally, reinforcing our enthusiasm for the market prospects for viaLink's foundational services," concluded Kilbourne. "Our services address tremendous industry complexity. Most importantly, the viaLink solution is deployed and proven, and customers can increase sales, save time, reduce errors and reduce costs now."
About viaLink
The viaLink Company (Nasdaq:VLNK) is a leading provider of subscription-based, business-to-business electronic commerce services that enable consumer packaged goods (CPG) and grocery industry participants to efficiently manage their highly complex supply chain information. viaLink's services allow manufacturers, wholesalers, distributors and retailers to communicate and synchronize item, price and promotion information in a more cost-effective and accessible way than has been possible using traditional electronic and paper-based methods. For more information, visit viaLink's Web site at http://www.vialink.com.
This release contains forward-looking statements that involve risks and uncertainties. The viaLink Company now resembles a development stage company, which has commenced its planned operations but has not yet generated significant revenues. Among the important factors that could cause actual results to differ materially from those in the forward-looking statements are the failure of viaLink's services to achieve market acceptance; the extent of viaLink's anticipated operating losses and negative cash flow; viaLink's dependence on its strategic alliance partners; intense marketplace competition; rapid technological change and the possible obsolescence of viaLink's service; dependence on certain key personnel and need to hire additional personnel; viaLink's inability to protect its proprietary technology; as well as other factors detailed in viaLink's filings with the Securities and Exchange Commission, including its recent filings on Forms SB-2, 10-KSB and 10-QSB.
The viaLink Company
Condensed Statements of Operations
For the Three Months
Ended March 31,
2000 1999
------ ------
Revenues $ 407,497 $ 108,178
Customer operations 1,727,813 278,500
Development 1,857,037 142,631
Selling and marketing 2,716,833 339,593
General and administrative 4,028,121 985,527
Depreciation and amortization 265,053 84,763
----------- -----------
Total operating expenses 10,594,857 1,831,014
Income (loss) from operations (10,187,360) (1,722,836)
Interest expense, net (981,153) (634,498)
Gain on sale of assets - 735,041
----------- -----------
Net income (loss) $(11,168,513)$ (1,622,293)
============= ============
Net income (loss) per
common share:
Basic and diluted $ (0.57) $ (0.14)
Weighted average shares
outstanding:
Basic and diluted 19,708,626 11,467,208
The viaLink Company
Condensed Balance Sheets
As of December 31, 1999 and March 31, 2000
March 31, December 31,
2000 1999
(unaudited)
--------- ----------
ASSETS
Cash and short-term investments $ 13,788,145 $ 15,095,748
Accounts receivable, net 371,645 122,796
Other current assets 699,041 868,112
------------- -------------
Total current assets 14,858,831 16,086,656
Other assets, net 10,727,350 7,151,933
Total assets $ 25,586,181 $ 23,238,589
============= ============
LIABILITIES AND
STOCKHOLDERS' EQUITY
Accounts payable and
other current liabilities
$ 3,422,536 $ 2,236,521
Convertible debt, long-term 5,400,920 4,230,720
Stockholders' equity 16,762,725 16,771,348
------------- -------------
Total liabilities and
stockholders' equity $ 25,586,181 $ 23,238,589
============= ============