EX-99.1 3 d00236exv99w1.txt PRESS RELEASE DATED OCTOBER 3, 2002 EXHIBIT 99.1 [INTERVOICE LOGO] NEWS RELEASE CONTACTS Intervoice, Inc. Rob-Roy J. Graham Chief Financial Officer +1 (972) 454-8712 42-02 INTERVOICE ANNOUNCES SECOND QUARTER RESULTS Conference call on October 4 at 2:30 p.m. CDT DALLAS, TEXAS --OCTOBER 3, 2002 -- Intervoice, Inc. (Nasdaq:INTV), announced today that sales during the second quarter of its fiscal 2003, which ended August 31, 2002, were $35.6 million. Earnings before interest, taxes, depreciation and amortization (EBITDA), when adjusted for $10.1 million of previously announced special charges booked during the quarter, including inventory write-downs, expected losses on customer contracts and severance and facility shut-down expenses, was a loss of $2.1 million, or $0.06 per share. The Company's net loss during the quarter, including special charges, was $16.3 million or $0.48 per share. "Our cash performance during the quarter was stronger than anticipated with $6.1 million in positive free cash flow during the quarter. As a result, we ended the quarter with $20.1 million cash on hand." said Rob Graham, the Company's CFO. "Our better than expected cash flow was the result of our receipt of $7.9 million in tax refunds and our continued concentration on balance sheet management and cost controls. Our receivables days sales outstanding (DSO's) were 82 days, and we reduced our gross inventories by $8.0 million." "The second quarter was very challenging," said David Brandenburg, the Company's Chairman and CEO. "Looking forward, we will emphasize sales and backlog growth, and we will continue to manage our balance sheet and monitor our organization for further cost reduction opportunities to lower our breakeven points." The Company has scheduled a conference call for Friday, October 4 at 2:30 p.m. Central Daylight Time to discuss its second quarter results and its outlook for the future. To participate in the call, dial 913-981-5509, confirmation code 350400. A replay of the call will be available at the Company's web site: www.intervoice.com. This press release contains forward-looking statements which are based on Company management's current beliefs. Readers are cautioned to read the risks and uncertainties described in the Company's filings with the Securities and Exchange Commission. These risks and uncertainties could cause actual results to vary materially from the forward-looking statements in this press release. ABOUT INTERVOICE With more than 21,000 systems deployed around the globe, Intervoice is the world leader in converged voice and data solutions providing the applications, tools and infrastructure that enable enterprises and carriers to attract and retain customers and promote profitability. Omvia(TM), Intervoice's open, standards-based product suite, is transforming the way people and information connect. Omvia offers speech-enabled IVRs and applications, multimedia and network-grade portals, wireless application gateways, and enhanced services such as unified messaging, short messaging services (SMS), voicemail, prepaid services and interactive alerts. Intervoice is headquartered in Dallas with offices in Europe, the Middle East, South America, and Asia Pacific. For more information, visit www.intervoice.com. Intervoice, Inc. Consolidated Balance Sheets
(In Thousands, Except Share and Per Share Data) ASSETS August 31, 2002 February 28, 2002 --------------- ----------------- (Unaudited) Current Assets Cash and cash equivalents $ 20,131 $ 17,646 Trade accounts receivable, net of allowance for doubtful accounts of $3,578 in fiscal 2003 and $3,492 in fiscal 2002 32,543 40,783 Inventory 16,461 27,524 Prepaid expenses and other current assets 6,710 6,152 Deferred income taxes 1,063 819 ------------ ------------ 76,908 92,924 ------------ ------------ Property and Equipment Building 16,883 19,530 Computer equipment and software 31,123 30,379 Furniture, fixtures and other 2,747 2,328 Service equipment 8,963 7,902 ------------ ------------ 59,716 60,139 Less allowance for depreciation 37,324 33,787 ------------ ------------ 22,392 26,352 Other Assets Intangible assets, net of amortization of $28,563 in fiscal 2003 and $31,752 in fiscal 2002 29,940 37,439 Goodwill, net of accumulated amortization of $7,672 in fiscal 2002 3,401 16,500 Other assets 1,754 2,153 ------------ ------------ $ 134,395 $ 175,368 ============ ============ LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities Accounts payable $ 15,794 $ 22,661 Accrued expenses 18,205 14,988 Customer deposits 8,499 5,963 Deferred income 27,043 24,426 Current portion of long term borrowings 4,056 6,000 ------------ ------------ 73,597 74,038 Long term borrowings, net of current portion 19,241 23,980 Other long term liabilities 1,482 1,916 Stockholders' Equity Preferred Stock, $100 par value--2,000,000 shares authorized: none issued Common Stock, no par value, at nominal assigned value--62,000,000 shares authorized: 34,077,307 issued and outstanding in fiscal 2003, 34,029,180 issued and outstanding in fiscal 2002 17 17 Additional capital 65,082 61,725 Retained earnings (deficit) (21,124) 19,618 Accumulated other comprehensive loss (3,900) (5,926) ------------ ------------ Stockholders' equity 40,075 75,434 ------------ ------------ $ 134,395 $ 175,368 ============ ============
Intervoice, Inc. Consolidated Statements of Operations (Unaudited)
(In Thousands, Except Per Share Data) Three Months Ended Six Months Ended ------------------------------ ------------------------------ August 31, August 31, August 31, August 31, 2002 2001 2002 2001 ------------ ------------ ------------ ------------ Sales Systems $ 17,905 $ 42,455 $ 39,540 $ 80,897 Services 17,708 22,034 34,489 45,098 ------------ ------------ ------------ ------------ 35,613 64,489 74,029 125,995 ------------ ------------ ------------ ------------ Cost of goods sold Systems 17,099 21,287 33,217 39,429 Services 7,626 10,139 14,297 19,789 ------------ ------------ ------------ ------------ 24,725 31,426 47,514 59,218 ------------ ------------ ------------ ------------ Gross margin Systems 806 21,168 6,323 41,468 Services 10,082 11,895 20,192 25,309 ------------ ------------ ------------ ------------ 10,888 33,063 26,515 66,777 Research and development expenses 6,518 7,060 12,523 14,623 Selling, general and administrative expenses 18,401 18,919 36,094 38,534 Amortization of goodwill and acquisition related intangible assets 1,776 3,435 3,552 6,788 ------------ ------------ ------------ ------------ Income (loss) from operations (15,807) 3,649 (25,654) 6,832 Other income (expense) (716) 451 (764) 956 Interest expense (1,555) (1,224) (3,020) (2,565) ------------ ------------ ------------ ------------ Income (loss) before taxes and the cumulative effect of a change in accounting principle (18,078) 2,876 (29,438) 5,223 Income taxes (benefit) (1,806) 1,151 (4,487) 2,090 ------------ ------------ ------------ ------------ Income (loss) before the cumulative effect of a change in accounting principle (16,272) 1,725 (24,951) 3,133 Cumulative effect on prior years of a change in accounting principle -- -- (15,791) -- ------------ ------------ ------------ ------------ Net income (loss) $ (16,272) $ 1,725 $ (40,742) $ 3,133 ============ ============ ============ ============ Per Basic Share: Income (loss) before the cumulative effect of a change in accounting principle $ (0.48) $ 0.05 $ (0.73) $ 0.09 Cumulative effect on prior years of a change in accounting principle -- -- (0.47) -- ------------ ------------ ------------ ------------ Net income (loss) $ (0.48) $ 0.05 $ (1.20) $ 0.09 ============ ============ ============ ============ Per Diluted Share: Income (loss) before the cumulative effect of a change in accounting principle $ (0.48) $ 0.05 $ (0.73) $ 0.09 Cumulative effect on prior years of a change in accounting principle -- -- (0.47) -- ------------ ------------ ------------ ------------ Net income (loss) $ (0.48) $ 0.05 $ (1.20) $ 0.09 ============ ============ ============ ============
Intervoice, Inc. Consolidated Statements of Cash Flows (Unaudited)
(In Thousands) Three Months Ended Six Months Ended ------------------------- ------------------------ August 31, August 31, August 31, August 31, 2002 2001 2002 2001 ----------- ---------- ---------- ---------- Operating Activities Income (loss) before the cumulative effect of a change in accounting principle $ (16,272) $ 1,725 $ (24,951) $ 3,133 Adjustments to reconcile income (loss) before the cumulative effect of a change in accounting principle to net cash provided by operating activities: Depreciation and amortization 4,290 6,843 8,466 13,289 Other changes in operating activities 23,776 (611) 26,617 (5,412) --------- --------- --------- --------- Net cash provided by operating activities 11,794 7,957 10,132 11,010 Investing Activities Purchases of property and equipment (1,847) (1,793) (2,448) (3,167) Proceeds from sale of assets -- -- 1,852 -- --------- --------- --------- --------- Net cash used in investing activities (1,847) (1,793) (596) (3,167) Financing Activities Paydown of debt (3,980) (3,783) (29,980) (9,567) Debt issuance costs (386) -- (2,018) -- Borrowings -- -- 24,000 -- Exercise of stock options 42 1,551 130 2,117 --------- --------- --------- --------- Net cash used in financing activities (4,324) (2,232) (7,868) (7,450) Effect of exchange rates on cash 515 105 817 (4) --------- --------- --------- --------- Increase in cash and cash equivalents 6,138 4,037 2,485 389 Cash and cash equivalents, beginning of period 13,993 12,253 17,646 15,901 --------- --------- --------- --------- Cash and cash equivalents, end of period $ 20,131 $ 16,290 $ 20,131 $ 16,290 ========= ========= ========= =========
Intervoice, Inc. Consolidated Statements of Changes in Stockholders' Equity (Unaudited)
(In Thousands, Except Share Data) Common Stock Accumulated Other ------------------------ Additional Retained Comprehensive Shares Amount Capital Earnings Loss Total ----------- ----------- ----------- ----------- ----------------- ----------- Balance at February 28, 2002 34,029,180 $ 17 $ 61,725 $ 19,618 $ (5,926) $ 75,434 Net loss -- -- -- (40,742) -- (40,742) Foreign currency translation adjustment -- -- -- -- 1,834 1,834 Valuation adjustment of interest rate swap hedge, net of tax effect of $(118) -- -- -- -- 192 192 Exercise of stock options 48,127 -- 130 -- -- 130 Tax benefit from exercise of stock options -- -- 2,171 -- -- 2,171 Issuance of warrants -- -- 1,056 -- -- 1,056 ----------- ----------- ----------- ----------- ----------- ----------- Balance at August 31, 2002 34,077,307 $ 17 $ 65,082 $ (21,124) $ (3,900) $ 40,075 =========== =========== =========== =========== =========== ===========
Intervoice, Inc. Reconciliation of Net Loss to Adjusted EBITDA For the Quarter Ended August 31, 2002
($000s) Per Share ------------ ------------ Net loss $ (16,272) $ (0.48) Add back EBITDA elements Interest 1,555 0.05 Taxes (1,806) (0.05) Depreciation and amortization 4,290 0.13 ------------ ------------ EBITDA (12,233) (0.36) Add back proforma adjustments 10,115 0.30 ------------ ------------ Adjusted EBITDA $ (2,118) $ (0.06) ============ ============
Basic shares used in per share calculation: 34,067
Recap of Proforma Adjustments to Operations COGS R&D SG&A TOTAL --------------------------------------------- ---------- ---------- ---------- ---------- Severance payments and related benefits $ 847 $ 406 $ 1,562 $ 2,815 Facility closure -- -- 388 388 Write down of excess inventories 2,240 -- -- 2,240 Costs associated with loss contracts 4,672 -- -- 4,672 ---------- ---------- ---------- ---------- Total $ 7,759 $ 406 $ 1,950 $ 10,115 ========== ========== ========== ==========