STOCKHOLM, Sweden, Feb. 18, 2002 (PRIMEZONE) -- ReadSoft:
-- The turnover for 2001 increased by 1 percent to 295,8 (291,6) MSEK
-- Results after interest income was -89,3 (10,6) MSEK
-- Turnover for the fourth quarter amounted to 91,1 (111,9) MSEK
-- Results after interest income for the fourth quarter was -17,2
(21,0) MSEK, including one-time costs of -18 MSEK.
-- Liquidity was 58,7 (112,8) MSEK including committed credit line
-- A cost savings program was carried out to decrease annual costs by
at least 60 MSEK year 2002
-- A new issue of shares was carried out to bring in 18 MSEK after
issue costs
-- An agreement was signed with Hagstromer & Qviberg
Fondkommission AB which gives ReadSoft the right to issue new
shares and/or convertible bonds to a maximum total amount of
50 MSEK.
Important Events During Year 2001
Despite a lower growth than planned, 2001 brought along a number of important deals, agreements and events.
In May, the prestigious business magazine Veckans Affarer awarded ReadSoft the title "IT-company of the year." The magazine praised ReadSoft's ability to establish new business abroad and develop software for which there is a great demand. Later that month, ReadSoft received the "Best of AIIM" award following the world-leading document management exhibition AIIM. The jury's motivation was that ReadSoft's software Eyes & Hands INVOICES 5-2 is the most developed solution for handling data in unstructured documents.
During 2001 ReadSoft continued to roll out the INVOICES product. A number of well-renowned companies and organizations decided to invest in the software for automatic processing of supplier invoices. Some of these were: Daimler Chrysler, Dokumenthuset, Bankgirocentralen and Pharmacia.
ReadSoft's second product, FORMS, still stands for the larger part of the license revenue. Tesco, SPSS MR, Littlewoods Leisure, ASX Australian Stock Exchange and a number of census projects around the world all decided to implement FORMS during 2001.
The ReadSoft partner network was heavily reinforced during the fall when global reseller agreements were signed with the ERP providers Intentia and IFS. They will resell ReadSoft's software INVOICES throughout their international reseller network.
At the end of the year, ReadSoft presented a SAP-validated Integration Option Pack for mySAP.com and became a member of the SAP Software Partner program.
Due to much weaker sales than planned during 2001, ReadSoft carried out a substantial cost savings program to reduce the annual costs by approximately 60 MSEK. The program will be in full effect as of the start of 2002.
During 2001 ReadSoft established two new subsidiaries, in Norway and Mexico. As a part of the cost savings program ReadSoft also decided to sell the Italian subsidiary. After the buy-out the local management will continue to provide the Italian market with ReadSoft's products and services.
Turnover and Results During the Fourth Quarter
During the fourth quarter, the revenue amounted to 91,1 (111,9) MSEK, a decrease by 18 percent. Results after interest income for the period was -17,2 (21,0) MSEK. The operating margin for the quarter was -18,9 (18,8) percent, including one-time costs amounting to -18 MSEK. These are mainly restructuring costs in connection with the cost savings program and provisions for bad debts.
The company's sales on the major export markets outside of Scandinavia, during the fourth quarter amounted to 63,2 (81,3) MSEK. In Scandinavia the sales totaled 27,9 (30,6) MSEK. The license revenue, consisting of one-time payments for the right to use our software, amounted to 43,2 (59,9) MSEK during the fourth quarter, which is 47 (53) percent of the total revenue. Out of the total license revenue for the fourth quarter, FORMS represented 65 (62) percent and INVOICES 35 (38) percent. Service fees (annual proceeds from service agreements) amounted to 17,3 (15,3) MSEK. In addition, revenues for training and customer-specific development were 10,4 (13,0) MSEK. Hardware sales (mainly scanners) amounted to 16,6 (19,6) MSEK. Other revenues totaled 3,6 (4,1) MSEK.
Turnover and Results 2001
2001 brought along a 1 percent revenue growth compared to the same period last year. The turnover was 295,8 (291,6) MSEK and the result after financial items was -89,3 (10,6). The operating margin for the period was -30,2 (3,6) percent, including one-time costs amounting to - 23 MSEK. Teose are mainly restructuring costs in connection with the cost savings program and provisions for bad debts.
During the year, the company's sales on the major export markets outside of Scandinavia amounted to 216,1 (226,6) MSEK. In Scandinavia our sales increased by 23 percent and totaled 79,7 (65,0) MSEK.
License revenue, for the period January -December, amounted to 130,2 (142,4) MSEK which is 44 (49) percent of the total revenue. Out of the total license revenue, FORMS accumulated 70 (77) percent and INVOICES 30 (23) percent. Revenue from service agreements amounted to 61,9 (44,5) MSEK. Revenues for training and customer-specific development were 39,2 (41,0) MSEK. Hardware sales amounted to 47,8 (46,3) MSEK. Other revenues totaled 16,7 (17,4) MSEK.
Staff
As of December 31, 2001, the ReadSoft staff amounted to 285 (282), a decrease by 63 employees compared to September 30. The average number of employees during the year was 327 (234). Of these 31(24) percent are women and 69(76) percent men.
Investments
Investments during the year amounted to 11,6 (10,6) MSEK and consisted of the acquisition of computer-, office- and event related equipment. Investments during the fourth quarter amounted to 0,2 (4,6) MSEK. All costs for product development have continually burdened the results for the period.
Financial Position
The liquidity as of December 31 was 58,7 (112,8) MSEK including 35,0 (21,0) in committed credit line. The solidity was 47,3 (60,1) percent as of December 31. At the beginning of the year, the solidity was 60,1 percent.
ReadSoft AB and Hagstromer & Qviberg Fondkommission AB have closed (September 2001) an agreement which gives ReadSoft the possibility to issue new shares and/or convertible bonds to a maximum total amount of 50 MSEK during a three-year period, if needed. The board of directors can call upon a number of new issues of shares/convertible bonds, in the interval 10-20 MSEK each during the period. When called upon, Hagstromer & Qviberg Fondkommission AB will issue the shares and/or convertible bonds.
Shareholder Information
At the end of the period, the number of shareholders amounted to 7 374 (5 552). Out of the company's total capital, 45 (50) percent were owned by Swedish and foreign institutions, 29 (30) percent by the company's founders, and 26 (20) percent by private persons, including staff. At the end of the period, Swedish shareholders held 82 (76) percent and foreign shareholders held 18 (24) percent of the total share value.
The Parent Company
The parent company's net sales for the year, including inter-company posts, amounted to 100,3 (108,7) MSEK. The result after financial items was -79,4 (-6,4) MSEK. Investments in the parent company amounted to 8,4 (5,4) MSEK. At the end of the period, liquidity was 31,6 (73,4) MSEK including 30,0 (15,0) MSEK in committed credit line. Equity was 104,1 (162,1) MSEK, resulting in a solidity of 82,0 (88,0) percent.
Products
Our product concept e-capture offers a complete solution for automatic data capture. e-capture means the ability to capture, interpret and process information from paper, fax, the web, email and other media and transport it to a customer's target system. ReadSoft's software is called FORMS and INVOICES and they facilitate and improve the data capture at companies and authorities all over the world. The products give our customers the possibility to lower their costs and automate their data capture, irrespective of if the information comes from paper or electronic documents. With ReadSoft's solutions, customers do not need to build and maintain parallel systems to handle the different information flows, instead they can build a uniform system with common rules for how the information should be captured and handled.
Future Prospect
Year 2001 has been a tough year for ReadSoft. The market decline stopped the planned expansion and brought along huge losses and a need for substantial savings in the organization. Moreover, the fourth quarter turned out to be weak. On the positive side, the cost savings program has now been carried out, to lower annual costs by at least 60 MSEK. ReadSoft enters 2002 with a market-adapted cost situation.
The goal for year 2002 is to become profitable and the long-term target for profit margin remains at 20 percent. Due to seasonal variations ReadSoft expects modest losses during the first part of the year. The profit will be generated during the later part of the year. Unless the market climate worsens, ReadSoft anticipates to grow during 2002, thus lower than the 25-30 percent long term growth target. The current market development is carefully monitored and in case of lower sales than planned, the readiness for swift actions is high. ReadSoft's products enables our customers to make substantial cost savings and this should provide ReadSoft with fine business opportunities even in a slow market climate. Despite the slow market, our INVOICES sales are growing, especially in Sweden, where we since 1999 have built a well-working reseller network with partners. We now work very hard to implement the same sales success internationally.
The start of the year, January, has gone according to plan and with an adapted market plan, the company anticipate to develop favorably in the future.
Coming Information Occastions
-- Interim Report January - March, presented April 26, 2002
-- Annual Shareholders meeting, held April 26, 2002, Helsingborg,
Sweden
-- Interim Report January - June, presented August 8, 2002
-- Interim Report January - September, presented October 25, 2002
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www.waymaker.net/bitonline/2002/02/18/20020218BIT00760/bit0001.doc The full year-end report www.waymaker.net/bitonline/2002/02/18/20020218BIT00760/bit0001.pdf The full year-end report