6-K 1 d6k.htm REPORT OF FOREIGN PRIVATE ISSUER Prepared by R.R. Donnelley Financial -- Report of Foreign Private Issuer
Form 6-K
 
Securities and Exchange Commission
Washington, D.C. 20549
 
Report of Foreign Private Issuer
 
Pursuant to Rule 13a-6 or 15d-16 of
the Securities Exchange Act of 1934
 
For the month of August 2002
 
 
ActivCard S.A.
(exact name of registrant as specified in its charter)
 
 
6623 Dumbarton Circle
Fremont, California 94555
(Address of Principal Executive Offices)
 
 
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:
 
Form 20-F [X] Form 40-F [    ]
 
Indicate by check mark whether the registrant by furnishing the information contained in this form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934:
 
Yes  ¨        No  x

 
Forward-looking Statements
 
This Report of Foreign Private Issuer Pursuant to Rule 13a-6 or 15d-16 of the Securities Exchange Act of 1934 contains disclosures that are “Forward-looking Statements.” Forward-looking statements involve risks and uncertainties and several factors could cause actual results to differ materially from those in the forward-looking statements. Forward-looking statements relate to anticipated revenues, gross margins, earnings, and growth of the market for our products. The following factors, among others, could cause actual results to differ from those indicated in the forward-looking statements: our ability to achieve profitability, uncertainties associated with market acceptance of and demand for our products, impact of competitive products and pricing, dependence on third party suppliers, uncertainties associated with the development of technology, dependence on intellectual property rights, and our ability to integrate acquired businesses, products or technologies. Investors are directed to the most recent ActivCard S.A. annual report on Form 20-F, available from the company without charge, for a more complete description of our business and to ActivCard S.A.’s Prospectus dated March 16, 2000 included in the Company’s Registration Statement on Form F-1 (No. 333-11540) filed with the Securities and Exchange Commission for other factors that could cause actual results to differ materially from those in the forward-looking statements.
 
We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. You are cautioned not to unduly rely on such forward-looking statements when evaluating the information presented herein.
 
 
This Form 6-K includes the press release “ActivCard Achieves Record Second Quarter Revenues,” dated August 6, 2002.
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
 
Date: August 14, 2002
 
ACTIVCARD, S.A.
By:
  
/S/  BLAIR GEDDES        
   
Blair Geddes
Chief Financial Officer
 

2

 
ACTIVCARD ACHIEVES RECORD SECOND QUARTER REVENUES
 
Significant Customer Wins In The Enterprise And Government Sectors
Drive Sequential Revenues 18% Higher
 
FREMONT, CA – August 6, 2002 – ActivCard, S.A. and its subsidiaries (“ActivCard,” or the “Company”) [NASDAQ: ACTI / NASDAQ Europe: ACTI], a leader in identity management and strong authentication solutions, today reported financial results for its second quarter ended June 30, 2002.
 
Revenue for the second quarter ended June 30, 2002 was a company record $9.6 million, an increase of 18% over the $8.2 million reported in the first quarter of 2002 and a year-over-year increase of 13% from the second quarter of 2001.
 
“We are very pleased with the results we achieved in the second quarter,” commented ActivCard Chief Executive Officer Steven Humphreys. “ActivCard® achieved record revenues, despite the ongoing challenges in the economy and, more specifically, corporate IT spending. Our customer wins in the enterprise and government sectors show that CEOs and government officials alike are facing up to the reality of security risks. They are investing in solutions like ours, that prove the identity of employees, because it is good business strategy.”
 
Net loss for the quarter was $4.7 million, or $0.11 per diluted share, compared to a net loss of $2.7 million, or $0.07 per diluted share, in the second quarter of the prior year. Pro forma net loss for the quarter was $3.0 million, or $0.07 per diluted share, compared to pro forma net loss of $2.8 million, or $0.07 per diluted share, in the second quarter of the previous year. Pro forma net loss excludes acquisition-related charges, deferred stock compensation, foreign exchange gains and losses, restructuring charges, and operating results of discontinued operations.
 
Mr. Humphreys added, “We were successful winning enterprise customers in Europe as well as in the United States, confirming the strength and depth of our solution offering and our sales channel. We grew market share, revenue, and momentum in our business. In an environment where our competitors are experiencing flat or negative growth, we continue to execute on our publicly stated plan, demonstrating predictability, and, by controlling expenses, we are progressing on the path to profitability.”
 
Second Quarter 2002 Highlights
 
During the second quarter of 2002, ActivCard:
 
 
•
 
Won initial deployments with new departments within the U.S. Department of Defense (DoD), and expanded existing DoD deployments
 
 
•
 
Won initial deployments with three other U.S. federal government agencies, and began shipping its first significant win through VeriSign
 
 
•
 
Signed a licensing agreement with a large software provider
 
 
•
 
Shipped the first order for ActivPack™ and related hardware to Innovant/VISA for their provisioning of authentication services to membership banks
 
 
•
 
Won initial deployments with six multinational conglomerate enterprise customers in Europe and the Middle East, one of which has already completed testing of its corporate identity badge project and is ready for full deployment
 
 
•
 
Signed distribution agreements with 15 new channel partners.

1

 
Third Quarter and Fiscal 2002 Outlook
 
For the third quarter of 2002, the Company anticipates continued sequential growth with revenues ranging between $10.0 million and $11.0 million. Actual GAAP net loss for the third quarter is expected to range between $0.07 and $0.11 per share. Pro forma net loss per share is expected to range between $0.04 and $0.07. For fiscal 2002, the Company’s financial objectives continue to be revenue growth of 30% to 35% from fiscal 2001, with continued focus on expense management. The Company reiterates its earlier guidance to achieve cash flow break-even in the fourth quarter of 2002 and break-even on a pro forma basis in the first quarter of 2003.
 
ActivCard will hold a conference call at 11 a.m. EST on August 6, 2002, featuring Mr. Humphreys and Chief Financial Officer Blair Geddes, to discuss these second quarter results. A live Webcast of this conference call will be available on the Investor page of the Company’s Website at www.activcard.com. Webcast participants should register approximately 15 minutes before the event to download and install any necessary software. A replay of the Webcast will be available on the Website’s investor page.
 
About ActivCard, Inc.
 
ActivCard, www.activcard.com, is recognized as a leader in identity management and strong authentication solutions. We give businesses and governments the confidence that people are who they say they are online. ActivCard has the unique ability to implement a complete end-to-end, open standards-based digital identity system. We are trusted by the leading names in network computing including Hewlett-Packard, Sun Microsystems, and VeriSign, as well as the U.S. Department of Defense.
 
The statements in this press release that are not historical facts are forward-looking statements that involve risks and uncertainties, including risks associated with fluctuations in operating results, our history of losses, the concentration of our customer base, our reliance on strategic relationships, acquisitions and managing the Company’s future growth, and other risks identified in the Company’s periodic filings with the United States Securities and Exchange Commission, including but not limited to those appearing under the caption “Risk Factors” in the Company’s annual report on Form 20-F. Actual results, events and performance may differ materially. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. ActivCard disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
 
Contacts
 
INVESTORS:
Teresa Thuruthiyil,
Ty George
FD Morgen-Walke
415-296-7383
     
MEDIA:
Ron Heckmann,
Chris Toth
FD Morgen Walke
415-439-4513
     
COMPANY:
Megan O’Reilly-Lewis
ActivCard, Inc.
510-574-1789
mlewis@activcard.com
     
EUROPE:
Christina Zinck
ActivCard Europe
Suresnes, France
+33 (1) 42 04 8400
christina.zinck@activcard.fr

2

 
ActivCard, S.A.
 
Unaudited Condensed Consolidated Statements of Operations (U.S. GAAP)
(In thousands of US dollars, except per share data)
 
   
For the three months ended
June 30,
     
For the six months ended
June 30,
  
   
2002
    
2001
     
2002
     
2001
  
Revenues
  
$
9,607
 
  
$
8,525
 
   
$
17,772
 
   
$
15,614
 
Cost of revenues
  
 
2,869
 
  
 
2,785
 
   
 
5,514
 
   
 
5,298
 
   
 
  
  
Gross margin
  
 
6,738
 
  
 
5,740
 
   
 
12,258
 
   
 
10,316
 
   
 
  
  
Operating expenses
                                  
Selling and marketing
  
 
5,138
 
  
 
6,640
 
   
 
10,370
 
   
 
12,077
 
General and administrative
  
 
1,029
 
  
 
910
 
   
 
1,956
 
   
 
2,033
 
Research and development
  
 
4,918
 
  
 
4,249
 
   
 
9,906
 
   
 
7,844
 
Other charges
  
 
1,142
 
  
 
800
 
   
 
9,479
 
   
 
4,964
 
   
 
  
  
   
 
12,227
 
  
 
12,599
 
   
 
31,711
 
   
 
26,918
 
   
 
  
  
Loss from operations
  
 
(5,489
)
  
 
(6,859
)
   
 
(19,453
)
   
 
(16,602
)
Interest and other income
  
 
1,369
 
  
 
3,262
 
   
 
2,611
 
   
 
8,957
 
Foreign exchange (loss) gain
  
 
(114
)
  
 
930
 
   
 
(79
)
   
 
4,608
 
   
 
  
  
Loss from continuing operations before income taxes
  
 
(4,234
)
  
 
(2,667
)
   
 
(16,921
)
   
 
(3,037
)
Income taxes
  
 
(68
)
  
 
—  
 
   
 
(69
)
   
 
(1
)
   
 
  
  
Loss from continuing operations
  
 
(4,302
)
  
 
(2,667
)
   
 
(16,990
)
   
 
(3,038
)
Loss from discontinued operations
  
 
(409
)
  
 
—  
 
   
 
(16,327
)
   
 
—  
 
   
 
  
  
Net loss
  
$
(4,711
)
  
$
(2,667
)
   
$
(33,317
)
   
$
(3,038
)
   
 
  
  
Net loss per common share:
                                  
Basic and diluted
  
$
(0.11
)
  
$
(0.07
)
   
$
(0.81
)
   
$
(0.08
)
Weighted average number of common shares:
                  
Basic and diluted
  
 
41,279
 
  
 
39,918
 
   
 
40,897
 
   
 
39,912
 
Other charges consist of:
                                  
Amortization of intangibles related to acquisition
  
$
525
 
  
$
—  
 
   
$
1,091
 
   
$
—  
 
Amortization of deferred compensation related to acquisition
  
 
106
 
  
 
    —  
 
   
 
207
 
   
 
—  
 
Acquired in process research and development
  
 
—  
 
  
 
101
 
   
 
68
 
   
 
101
 
Acquisition termination charges
  
 
—  
 
  
 
(228
)
   
 
—  
 
   
 
3,781
 
Amortization of deferred compensation related to options and warrants granted
  
 
244
 
  
 
—  
 
   
 
494
 
   
 
—  
 
Restructuring and business realignment expenses
  
 
267
 
  
 
—  
 
   
 
7,619
 
   
 
—  
 
Compensation paid to departing C.E.O.
  
 
—  
 
  
 
881
 
   
 
—  
 
   
 
881
 
Settlement of litigation
  
 
—  
 
  
 
46
 
   
 
—  
 
   
 
201
 
   
 
  
  
Total other charges
  
$
1,142
 
  
$
800
 
   
$
9,479
 
   
$
4,964
 
   
 
  
  

3

 
ActivCard, S.A.
 
Unaudited Pro Forma Condensed Consolidated Statements of Operations
(In thousands of US dollars, except per share data)
 
    
For the three months ended June 30,
     
For the six months ended
June 30,
  
    
2002
     
2001
     
2002
     
2001
  
Revenues
   
$
9,607
 
   
$
8,525
 
   
$
17,772
 
   
$
15,614
 
Cost of revenues
   
 
2,869
 
   
 
2,785
 
   
 
5,514
 
   
 
5,298
 
    
  
  
  
Gross margin
   
 
6,738
 
   
 
5,740
 
   
 
12,258
 
   
 
10,316
 
    
  
  
  
Operating expenses
                                    
Selling and marketing
   
 
5,138
 
   
 
6,640
 
   
 
10,370
 
   
 
12,077
 
General and administrative
   
 
1,029
 
   
 
910
 
   
 
1,956
 
   
 
2,033
 
Research and development
   
 
4,918
 
   
 
4,249
 
   
 
9,906
 
   
 
7,844
 
    
  
  
  
    
 
11,085
 
   
 
11,799
 
   
 
22,232
 
   
 
21,954
 
    
  
  
  
Pro forma loss from operations
   
 
(4,347
)
   
 
(6,059
)
   
 
(9,974
)
   
 
(11,638
)
Interest and other income
   
 
1,369
 
   
 
3,262
 
   
 
2,611
 
   
 
8,957
 
Income taxes
   
 
(68
)
   
 
—  
 
   
 
(69
)
   
 
(1
)
    
  
  
  
Pro forma net loss
   
$
(3,046
)
   
$
(2,797
)
   
$
(7,432
)
   
$
(2,682
)
    
  
  
  
Pro forma net loss per common share:
                                    
Basic and diluted
   
$
(0.07
)
   
$
(0.07
)
   
$
(0.18
)
   
$
(0.07
)
Weighted average number of common shares:
                                    
Basic and diluted
   
 
41,279
 
   
 
39,918
 
   
 
40,897
 
   
 
39,912
 
Reconciliation of pro forma net loss to U.S. GAAP net loss:
                                    
Pro forma net loss
   
$
(3,046
)
   
$
(2,797
)
   
$
(7,432
)
   
$
(2,682
)
    
  
  
  
Add back items excluded from the derivation of pro forma net loss:
                                    
Operating expenses
                                    
Acquisition-related charges
   
 
631
 
   
 
(127
)
   
 
1,366
 
   
 
3,882
 
Amortization of deferred compensation related to options and warrants granted
   
 
244
 
   
 
—  
 
   
 
494
 
   
 
—  
 
Restructuring and business realignment expenses
   
 
267
 
   
 
—  
 
   
 
7,619
 
   
 
—  
 
  Compensation paid to departing C.E.O.
   
 
—  
 
   
 
881
 
   
 
—  
 
   
 
881
 
Settlement of litigation
   
 
—  
 
   
 
46
 
   
 
—  
 
   
 
201
 
    
  
  
  
Total excluded from operating expenses
   
 
1,142
 
   
 
800
 
   
 
9,479
 
   
 
4,964
 
Foreign exchange loss (gain)
   
 
114
 
   
 
(930
)
   
 
79
 
   
 
(4,608
)
Loss from discontinued operations
   
 
409
 
   
 
—  
 
   
 
16,327
 
   
 
—  
 
    
  
  
  
Total pro forma adjustments
   
 
1,665
 
   
 
(130
)
   
 
25,885
 
   
 
356
 
    
  
  
  
U.S. GAAP net loss
   
$
(4,711
)
   
$
(2,667
)
   
$
(33,317
)
   
$
(3,038
)
    
  
  
  

4

 
ActivCard, S.A.
 
Unaudited Condensed Consolidated Balance Sheets (U.S. GAAP)
(In thousands of US dollars)
 
    
June 30, 2002
     
December 31, 2001
  
ASSETS
                  
Current assets
                  
Cash and equivalents
   
$
150,194
 
   
$
248,444
 
Short term investments
   
 
94,316
 
   
 
—  
 
Accounts receivable
   
 
6,113
 
   
 
8,314
 
Inventory
   
 
4,296
 
   
 
3,917
 
Loan to officer
   
 
2,765
 
   
 
2,718
 
Other receivables
   
 
616
 
   
 
2,647
 
Assets held for sale
   
 
553
 
   
 
15,870
 
Other current assets
   
 
2,420
 
   
 
1,975
 
    
  
Total current assets
   
 
261,273
 
   
 
283,885
 
Restricted investments
   
 
325
 
   
 
241
 
Property and equipment
   
 
8,241
 
   
 
8,868
 
Goodwill and other intangibles
   
 
19,021
 
   
 
17,397
 
Other assets
   
 
1,449
 
   
 
1,057
 
    
  
Total assets
   
$
290,309
 
   
$
311,448
 
    
  
LIABILITIES AND SHAREHOLDERS’ EQUITY
         
Current liabilities
                  
Accounts payable
   
$
5,084
 
   
$
6,298
 
Restructuring and business realignment accruals
   
 
5,090
 
   
 
—  
 
Accrued liabilities
   
 
1,863
 
   
 
3,629
 
Liabilities held for sale
   
 
837
 
   
 
827
 
Deferred revenue
   
 
1,863
 
   
 
2,231
 
Other current liabilities
   
 
461
 
   
 
278
 
    
  
Total current liabilities
   
 
15,198
 
   
 
13,263
 
    
  
Long-term liabilities
   
 
415
 
   
 
625
 
    
  
Shareholders’ equity
                  
Common shares and paid-in capital
   
 
398,321
 
   
 
393,914
 
Accumulated deficit
   
 
(103,593
)
   
 
(70,276
)
Accumulated other comprehensive loss
   
 
(16,259
)
   
 
(20,637
)
Deferred stock compensation
   
 
(3,773
)
   
 
(5,441
)
    
  
Total shareholders’ equity
   
 
274,696
 
   
 
297,560
 
    
  
Total liabilities and shareholders’ equity
   
$
290,309
 
   
$
311,448
 
    
  

5