-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, WbcQPu0Dz5vbVewVpLOHp9tf0Am2se+Zk/9QzAshdCj6q82ag4PUcskPgD4T1vgH MVZPoREseLdA/C6+WBKpIA== 0001266454-06-000075.txt : 20060215 0001266454-06-000075.hdr.sgml : 20060215 20060215160212 ACCESSION NUMBER: 0001266454-06-000075 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20060214 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Regulation FD Disclosure ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20060215 DATE AS OF CHANGE: 20060215 FILER: COMPANY DATA: COMPANY CONFORMED NAME: INTERNATIONAL MICROCOMPUTER SOFTWARE INC /CA/ CENTRAL INDEX KEY: 0000814929 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-PREPACKAGED SOFTWARE [7372] IRS NUMBER: 942862863 STATE OF INCORPORATION: CA FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-15949 FILM NUMBER: 06621937 BUSINESS ADDRESS: STREET 1: 100 ROWLAND WAY STREET 2: SUITE 300 CITY: NOVATO STATE: CA ZIP: 94945 BUSINESS PHONE: 4158784000 MAIL ADDRESS: STREET 1: 100 ROWLAND WAY STREET 2: SUITE 300 CITY: NOVATO STATE: CA ZIP: 94945 8-K 1 imsi_8k-021406.htm INTERNATIONAL MICROCOMPUTER SOFTWARE, INC. International Microcomputer Software, Inc.

 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
 
 
FORM 8-K
 
CURRENT REPORT
 
 
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 

Date of Report (Date of earliest event reported) February 14, 2006
 
Commission File Number 0-15949


INTERNATIONAL MICROCOMPUTER SOFTWARE, INC.
(Exact name of registrant as specified in its charter)

 
California
  
94-2862863
(State or other jurisdiction of incorporation or organization)
  
(I.R.S. Employer identification No.)



100 Rowland Way, Suite 300, Novato, CA
 
94945
(Address of principal executive offices)
  
(Zip code)
 

(415) 878-4000
(Registrant's telephone number including area code)



 
 
 


ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION.

 
The following information is being furnished pursuant to both Item 2.02 and Item 7.01.

On February 14, 2006, International Microcomputer Software, Inc. (the "Company") announced its financial results for the three and six months ended December 31, 2005. The full text of the press release issued in connection with the announcement is attached as Exhibit 99.1 to this Current Report on Form 8-K.

The information in this report is being furnished, and is not deemed as "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and shall not be deemed incorporated by reference in any filings under the Securities Act of 1933, as amended, unless specifically stated so therein.

The Company includes the use of a non-GAAP financial information in the attached exhibit. In accordance with Item 10(h)(1) of Regulation S-B, IMSI is required to provide a statement disclosing the reasons why management believes that presentation of non-GAAP financial measures and information provides useful information to investors regarding the Company’s results of operations. IMSI management evaluates and makes operating decisions using various operating measures. These measures are generally based on the revenues and certain costs of its operations, such as cost of goods sold and selling, general and administrative expenses. One such group of measures is GAAP net income (loss) as adjusted for non-cash activity and taxes (including “EBITDA”), which are non-GAAP financial measures under Section 101 of Regulation G under the Securities Exchange Act of 1934, as amended. Management believes it is useful in measuring IMSI’s operations to identify these factors which relate to cash flows and provide them to the market in a summarized form. Management believes that GAAP net income (loss) as adjusted for non-cash activity and taxes provides useful supplemental information to management and investors regarding the performance of the company’s business operations and facilitates comparisons to our historical operating results. Management also uses this information internally for forecasting and budgeting. Non-GAAP financial measures should not be considered as a substitute for measures of financial performance prepared in accordance with GAAP. Investors and potential investors are encouraged to review the reconciliation of non-GAAP financial measures contained within the attached press release with their most directly comparable GAAP financial results.  As used herein, “GAAP” refers to accounting principles generally accepted in the United States.
 

ITEM 7.01 REGULATION FD DISCLOSURE.


 
ITEM 9.01 FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.


(a) Not applicable.

(b) Not applicable.

(c) Exhibits.

 
Exhibit No.
Description of Exhibit
 
99.1
Press release dated February 14, 2006

 
 
 
 
SIGNATURE

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 hereunto duly authorized.
 
 
 
 
 
INTERNATIONAL MICROCOMPUTER SOFTWARE, INC.
 
 
 
 
 
 
Dated: February 15, 2006
By:  
/s/ MARTIN WADE, III
 
Name: Martin Wade, III
 
Title: Chief Executive Officer 





EXHIBIT INDEX
 

Exhibit No.
Description

99.1
Press release dated February 14, 2006
EX-99.1 2 imsi_ex9901.htm PRESS RELEASE Press Release

Exhibit 99.1
 

HOUSEPLANS DIVISION ATTAINS 69% SALES GROWTH

 
Houseplans™ business driven by 21% organic growth and acquisition of globalHouseplans.com
 
 
NOVATO, Calif., February 14, 2006 - IMSI® (OTC BB: IMSI), a leading provider of house plans online and a leading developer and publisher of precision design, and consumer and business software solutions, today announced its financial results for the second fiscal quarter ended December 31, 2005. For the three months ended December 31, 2005, IMSI reported net income of $121,000, or ($0.00) per share on net revenues of $3.7 million. Net revenues increased by 69% in the Houseplans™ business and 7% overall, as compared to the previous fiscal year, reflecting primarily continued growth in the Houseplans™ business.

The following are highlights for the three months ended December 31, 2005:

 
·
Net income of $121,000.
 
·
Growth in Houseplans™ was 69 % and 114% for the three and six months, and 21% and 47% for the three and six months without the acquisition of globalHouseplans.com.
 
·
Houseplans™ gross margins improved to 64% from 54% as compared to the previous fiscal year.
 
·
International net revenue increased 48% driven by globalHouseplans.com.

Non GAAP Information
 
·
GAAP net income (loss) when adjusted for certain non-cash activity and taxes to “EBITDA” was a positive $603,000 for the quarter year.

“The Houseplans™ business acquired globalhouseplans.com in July and has met our expectations to date for the sale of stock house plans. We now have over 21,000 stock house plans, the largest collection of exceptional house plans online, selling on 3 major sites,” said Martin Wade III, Chief Executive Officer. “Our balance sheet continues to be strong $9.8 million in cash and cash equivalents and without any call upon our resources by our prospective partner AccessMedia under the joint operating agreement,” continued Mr. Wade. “We cannot include approximately $1.2 million in escrow from the sale of Allume in July but we have an expectation that these funds will eventually be released over the coming year according to the terms of the sale agreement. The sale of Smith Micro stock received in the Allume sale contributed a realized gain of $923,000 during the quarter, and this was over and above the initial sale price.”

IMSI will have an earnings call on Tuesday, February 14, 2006, at 4:00 p.m. Eastern Time (1:00 p.m. Pacific Time). The public may participate in this event by calling (877) 704-5386. Individuals are also invited to listen to the conference call, which will be broadcast live over the Internet beginning Tuesday, February 14, 2006, at 4:00 p.m. Eastern Time. To listen to the call live over the Internet, simply visit www.imsisoft.com and select the earnings call icon.



In addition to disclosing results determined in accordance with generally accepted accounting principles (GAAP), IMSI also discloses non-GAAP results of operations that exclude certain items. By disclosing this non-GAAP information, management intends to provide investors with additional information to further analyze the company’s performance, core results and underlying trends. Management utilizes a measure of net income on a non-GAAP basis that excludes certain charges to better assess operating performance.

Non-GAAP information is not determined using GAAP; therefore, the information is not necessarily comparable to other companies and should not be used to compare the company’s performance over different periods. Non-GAAP information should not be viewed as a substitute for, or superior to, net income or other data prepared in accordance with GAAP as measures of our profitability or liquidity. Users of this financial information should consider the types of events and transactions for which adjustments have been made. See the following table for a reconciliation of this non-GAAP amount to amounts reported under GAAP.

EBITDA Analysis
           
(In thousands)
           
   
FY 2005
  
FY 2006
   
Q1
Q2
  
Q1
Q2
             
Net (Loss) Income - the GAAP measure
 
($275)
$129
 
($1,952)
$122
Interest paid
 
70
55
 
123
21
Taxes
 
5
3
 
-
39
Depreciation & Amortization
 
262
303
 
356
422
             
EBITDA - Non-GAAP
 
$62
$490
 
($1,473)
$604
             
Notes on components of Net (Loss) Income related to transactions
           
Income from the sale of Discontinued Operations
 
285
159
 
0
0
             
Gain from the sale of Discontinued Operations
 
53
0
 
(843)
369



 
INTERNATIONAL MICROCOMPUTER SOFTWARE, INC. AND SUBSIDIARIES
 
CONDENSED CONSOLIDATED BALANCE SHEETS
 
(In thousands, except share amounts)
 
  
December 31, 2005
  
June 30, 2005
  
 
  
Unaudited
 
 
  
ASSETS
     
 
  
Current assets:
           
Cash and cash equivalents
 
$
9,849
  
$
4,347
  
Trading securities
   
-
    
714
 
Receivables, less allowances for doubtful accounts, discounts and
returns of $551 as of December 31, 2005 and $626 as of June 30, 2005.
   
1,384
   
773
 
Inventories, net
   
873
   
758
 
Receivables, other (related to discontinued operations)
   
-
    
2,000
 
Receivables, other
   
-
    
30
 
Other current assets
   
1,278
   
530
 
Assets related to discontinued operations
   
-
    
12,231
 
Total current assets
   
13,384
   
21,383
 
 
            
Fixed assets, net
   
340
   
377
 
 
            
Intangible assets
           
Capitalized software, net
   
322
   
494
 
Domain names and brands, net
   
1,960
   
1,574
 
Distribution rights and proprietary plans, net
   
773
   
170
 
Capitalized customer lists, agreements and relationships, net
   
1,327
   
326
 
Goodwill
   
3,678
   
2,090
 
Trademarks, net
    
19
   
1
 
Total intangible assets
   
8,079
   
4,655
 
 
              
Total assets
 
$
21,803
  
$
26,415
  
 
            
LIABILITIES AND SHAREHOLDERS' EQUITY
           
Current liabilities:
           
Short-term debt
   
873
   
2,764
 
Trade accounts payable
   
1,364
   
2,245
 
Accrued and other liabilities
   
1,577
   
1,871
 
Deferred revenues
   
45
   
38
 
Liabilities related to discontinued operations
   
-
    
1,037
 
Total current liabilities
   
3,859
   
7,955
 
 
            
Long-term debt and other obligations
   
173
   
230
 
Total liabilities
   
4,032
   
8,185
 
 
            
Shareholders' equity
           
Common stock, no par value; 300,000,000 authorized; 29,845,877
Issued and outstanding as of December 31, 2005 and 28,796,886 issued
and outstanding as of June 30, 2005
    
44,843
   
43,663
 
Accumulated deficit
   
(27,161
)
  
(25,331
)
Accumulated other comprehensive income (loss)
   
89
   
(102
)
Total shareholders' equity
   
17,771
   
18,230
 
 
                
Total liabilities and shareholders' equity
 
$
21,803
  
$
26,415
  


INTERNATIONAL MICROCOMPUTER SOFTWARE, INC. AND SUBSIDIARIES
 
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS and COMPREHENSIVE INCOME / (LOSS)
 
(In thousands, except per share amounts)
(Unaudited)
 
Three months ended December 31,
  
Six months ended December 31,
  
 
  
2005
  
2004
  
2005
  
2004
  
Net revenues
 
$
3,719
  
$
3,478
  
$
7,684
  
$
6,613
  
Product costs
   
1,328
   
1,122
   
2,783
   
2,143
 
Gross margin
   
2,391
   
2,356
   
4,901
   
4,470
 
 
                        
Costs and expenses
                       
Sales and marketing
   
1,658
   
1,538
   
3,189
   
2,888
 
General and administrative
   
1,329
   
982
   
2,754
   
1,841
 
Research and development
   
553
   
368
   
988
   
837
 
Total operating expenses
   
3,540
   
2,888
   
6,931
   
5,566
 
 
                          
Operating loss
   
(1,149
)
  
(532
)
  
(2,030
)
  
(1,096
)
 
                        
Other income (expense)
                       
Interest and other, net
   
17
   
33
   
(52
)
  
39
 
Realized / unrealized gain on securities
   
923
   
471
   
765
   
422
 
Loss before income tax
   
(209
)
  
(28
)
  
(1,317
)
  
(635
)
 
                        
Income tax provision
   
(39
)
  
(2
)
  
(39
)
  
(8
)
 
                              
Loss from continuing operations
   
(248
)
  
(30
)
  
(1,356
)
  
(643
)
 
                        
Income from discontinued operations, net of income tax
   
-
    
159
   
-
    
444
 
Gain (loss) from the sale of discontinued operations, net of income tax
   
369
   
-
    
(474
)
  
53
 
Net income (loss)
 
$
121
  
$
129
    
($1,830
)
  
($146
)
 
                        
Other comprehensive income (loss)
                       
Unrealized loss on restricted securities
   
(478
)
  
-
    
-
    
-
  
Foreign currency translation adjustments
   
2
   
(24
)
  
191
   
(34
)
Comprehensive income (loss)
   
($355
)
$
105
    
($1,639
)
  
($180
)
 
                        
Basic earnings (loss) per share:
                       
Loss from continuing operations
   
($0.01
)
$
0.00
    
($0.05
)
  
($0.02
)
Income from discontinued operations, net of income tax
  
$
0.00
  
$
0.01
  
$
0.00
  
$
0.02
  
Gain (loss) from the sale of discontinued operations, net of income tax
  
$
0.01
  
$
0.00
    
($0.02
)
$
0.00
  
Net income (loss)
 
$
0.00
  
$
0.00
    
($0.06
)
  
($0.01
)
Diluted earnings (loss) per share:
                       
Loss from continuing operations
   
($0.01
)
$
0.00
    
($0.05
)
  
($0.02
)
Income from discontinued operations, net of income tax
 
$
0.00
  
$
0.01
  
$
0.00
  
$
0.02
  
Gain (loss) from the sale of  discontinued operations,
net of income tax
 
$
0.01
  
$
0.00
    
($0.02
)
$
0.00
  
Net income (loss)
 
$
0.00
  
$
0.00
    
($0.06
)
  
($0.01
)
 
                        
Shares used in computing basic earnings (loss) per share
   
29,821
   
27,196
   
29,755
   
27,605
 
Shares used in computing diluted earnings (loss) per share
   
31,831
   
29,885
   
29,755
   
27,605
 



INTERNATIONAL MICROCOMPUTER SOFTWARE, INC. AND SUBSIDIARIES
 
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
 
Six months ended December 31, 2005
(In thousands, except share amounts)
(Unaudited)
 
 
  
Common Stock
 
 
  
 
  
 
  
 
  
Shares
 
Amount
 
Accumulated deficit
 
Accumulated other comprehensive income (loss)
 
Total
 
Balance at July 1, 2005
 
28,796,886
 
$43,663
 
($25,331)
  
($102)
  
$18,230
 
 
                  
 
  
Issuance of common stock related to:
                             
Stock options exercised
   
85,291
   
73
               
73
 
Warrants exercised
   
117,117
   
-
               
-
 
Acquisitions
   
826,583
   
1,021
               
1,021
 
Finder's fee related to acquisition
   
20,000
   
25
               
25
 
 
                              
Issuance of stock options related to:
                             
Consulting services rendered
         
21
               
21
 
 
                              
Issuance of warrants related to:
                             
Acquisitions
         
6
               
6
 
Procurement of short-term debt
         
68
               
68
 
 
                              
Accrual of stock buy-back
         
(30
)
              
(30
)
 
                              
Issuance of stock options
         
2
               
2
 
 
                              
Variable accounting adjustment
         
(6
)
              
(6
)
 
                              
Net loss
               
(1,830
)
        
(1,830
)
 
                              
Foreign currency translation adjustment
                           
191
     
191
 
Balance at December 31, 2005
   
29,845,877
 
$
44,843
    
($27,161
)
$
89
  
$
17,771
  




INTERNATIONAL MICROCOMPUTER SOFTWARE, INC. AND SUBSIDIARIES
 
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
 
(In thousands)
(Unaudited)
 

 
  
Six months ended December 31,
  
 
  
2005
  
2004
  
Cash flows from operating activities:
           
Net cash provided by (used in) operating activities
   
($753
)
$
248
  
Cash flows from investing activities:
           
Proceeds from sale of discontinued operations
   
9,466
   
650
 
Proceeds from sale of product line
   
-
   
258
 
Acquisition of subsidiaries
   
(1,807
)
  
(1,356
)
Acquisition of software development, domain names and trademarks
   
-
   
(600
)
Purchases of equipment and software
   
(29
)
  
(163
)
Transfer cash to escrow for Jupitermedia
   
-
   
(499
)
Proceeds from the sale of marketable securities
   
1,524
    
1,780
 
Other
   
(8
)
  
25
 
Cash provided by discontinued operations in investing activities
   
-
   
464
 
Net cash provided by investing activities
   
9,146
   
559
 
Cash flows from financing activities:
           
Proceeds from borrowings
   
850
   
400
 
Repayments of notes
   
(3,802
)
  
(1,730
)
Proceeds from warrants and options exercised
   
73
   
137
 
Cash provided by discontinued operations in financing activities
   
-
   
12
 
Net cash used in financing activities
   
(2,879
)
  
(1,181
)
Effect of exchange rate change on cash and cash equivalents
   
(12
)
  
(34
)
Net increase (decrease) in cash and cash equivalents
   
5,502
   
(408
)
Cash and cash equivalents at beginning of period
   
4,347
   
3,212
 
Cash and cash equivalents at end of the period
 
$
9,849
  
$
2,804
  
               
               
     
Six months ended December 31, 
  
 
    
2005
    
2004
  
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Interest paid
   
128
   
125
 
 
            
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES
   
1,046
   
1,602
 
Warrants issued in conjunction with acquisitions
   
6
   
-
 
Notes payable incurred in conjunction with acquisitions
   
1,000
   
505
 
Warrants issued in conjunction with short-term debt
   
68
   
-
 




 
About IMSI
Founded in 1982, IMSI has established a tradition of providing the professional and home user with innovative technology and easy-to-use, high- quality software products at affordable prices. Anchored by IMSI's flagship product, TurboCAD® (www.turbocad.com), the company continues to be a leading developer and distributor of precision design and consumer software solutions. IMSI also owns and operates Houseplans™ (www.Houseplans.com), focused on expanding its network of Web properties to serve the rapidly growing market for the sale of stock house plans on-line and related home building services. More information about IMSI can be found at www.imsisoft.com.

When will a Proxy on the proposed IMSI - AccessMedia Transaction be available?
In connection with the merger of International Microcomputer Software, Inc. ("IMSI") and AccessMedia Networks, Inc. ("AccessMedia"), IMSI will file a proxy statement for IMSI's special stockholder meeting with the Securities and Exchange Commission. Investors and security holders are advised to read the proxy statement when it becomes available because it will contain important information about the proposed merger. Investors and security holders may obtain a free copy of the proxy statement (when available) and other documents filed by IMSI with the Securities and Exchange Commission at the Securities and Exchange Commission's web site at http://www.sec.gov. Free copies of the proxy statement (when available) and other documents filed by IMSI with the Securities and Exchange Commission may also be obtained from IMSI by directing a request to Investor Relations at IMSI (telephone (415) 878-4000). IMSI and its directors and its executive officers may be deemed, under SEC rules, to be soliciting proxies from IMSI's stockholders in favor of the proposed merger. Information regarding the identity of these persons, and their interests in the solicitation, will be set forth in a Schedule 14A to be filed with the SEC, and will be available free of charge at the SEC website and public reference rooms, and from the IMSI corporate secretary.

Safe Harbor Statement
This announcement contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results could differ materially from those projected in the forward-looking statements as a result of various factors including the ability of the company to successfully commercialize its new technologies as well as risk factors set forth from time to time in the Form 10-KSB for the period ended June 30, 2005 and other company reports filed with the Securities and Exchange Commission. The company undertakes no obligation to publicly release the result of any revisions to these forward-looking statements, which may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

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