-----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, C3LexVtpEFGDjfAOVeN05jQMSpk0tGK4VPy6oGRYaTI5u6wZ1s7QIyEqmLyOxy8C ZMqq3RTR19PYpbY7Dy4eGA== 0001012870-98-000084.txt : 19980122 0001012870-98-000084.hdr.sgml : 19980122 ACCESSION NUMBER: 0001012870-98-000084 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19980120 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19980121 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: COREL CORP CENTRAL INDEX KEY: 0000890640 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-PREPACKAGED SOFTWARE [7372] IRS NUMBER: 101151819 STATE OF INCORPORATION: A6 FISCAL YEAR END: 1130 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 000-20562 FILM NUMBER: 98510119 BUSINESS ADDRESS: STREET 1: 1600 CARLING AVE CITY: OTTAWA ONTARIO CANAD STATE: A6 BUSINESS PHONE: 6137288200 MAIL ADDRESS: STREET 1: 1600 CARLING AVENUE CITY: OTTAWA STATE: A6 8-K 1 FORM 8-K 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): January 20, 1998 COREL CORPORATION ------------------------------------------------------ (Exact name of Registrant as specified in its charter) Canada -------------------------------------------- (State or other jurisdiction of incorporation) 0-20562 Not Applicable ----------------- ------------------ (Commission (IRS Employer File Number) Identification No.) 1600 Carling Avenue, Ottawa, Ontario, Canada K1Z8R7 ------------------------------------------------------------------ (Address of principal executive offices) (Zip code) (613) 728-8200 ---------------------------------------------------- (Registrant's telephone number, including area code) Not Applicable ----------------------------------------------------------- (Former name or former address, if changed since last report) ITEM 5. OTHER EVENTS. On January 20, 1998, Corel Corporation (the "Company") issued a press release concerning (i) results for its fourth fiscal quarter ended November 30, 1997, and (ii) the restatement of certain financial information that was included in the Company's previously reported quarterly results for the first three fiscal quarters, to reflect certain adjustments to revenue and costs of sales relating to certain technology exchange transactions entered into by the Company in the first three quarters of fiscal 1997. The adjustments will decrease revenues for those quarters from previously reported amounts. A copy of the press release is attached hereto as Exhibit 99.01 and is incorporated herein. The Company expects to file amended Quarterly Reports on Form 10-Q to reflect the restatement of these items. ITEM 7: FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS. (c) Exhibits. --------- The following exhibits are filed herewith: 99.01 Press release dated January 20, 1998 2 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Date: January 20, 1998 Corel Corporation By: /s/ Michael P. O'Reilly ----------------------------- Michael P. O'Reilly, Vice President and Chief Financial Officer 3 EX-99.01 2 PRESS RELEASE [LOGO OF COREL APPEARS HERE] EXHIBIT 99.01 COREL FINANCIAL CONTACT: COREL PRESS CONTACT: Michael O'Reilly Carrie Bendzsa 613-728-0826 ext 1667 613-728-0826 ext 1524 michaelor@corel.ca carriebe@corel.ca FOR IMMEDIATE RELEASE COREL ANNOUNCES FOURTH QUARTER 1997 RESULTS RESTATES FIRST THREE QUARTERS OTTAWA, CANADA--JANUARY 20, 1998--Today, Corel Corporation released its 1997 fourth quarter financial results and results for its fiscal year ended November 30, 1997. (All the financial information is expressed in U.S. currency.) Revenues for the fourth quarter were $43.6 million, and for the full year were $260.6 million. The Company's net loss for the 1997 fiscal year was $231.8 million or $3.34 per share (fully diluted), which corresponds with the aggregate of the previously reported results for the first three quarters and the estimated loss for the fourth quarter of $95 million announced on December 18, 1997. That estimate included a write-off of approximately $28 million relating to the unamortized balance of costs of certain JAVA technologies acquired through technology exchange transactions during the first three quarters of fiscal 1997. The result actually reported for the fourth quarter is a loss of $67 million, or $1.00 per share (fully diluted). This differs from the $95 million estimate because the revenues and the related amortization of costs previously reported for the JAVA technologies exchange transactions will be eliminated in the audited financial statements for the year, thereby eliminating the $28 million write-off in the fourth quarter. The accounting treatment of these transactions in the first three quarters was considered appropriate at the time. The treatment now adopted results from further consideration by the Company's auditors in connection with the year-end audit. Applying this treatment for the first three quarters results in reductions in revenues of $13 million, $13 million and $7 million, producing losses of $11.3 million, $117.6 million and $35.9 million in the first, second, and third quarters, respectively. The quarterly results as reported for the first three quarters are restated accordingly. The full effects of the restatement are set out in detail in the financial summaries released today. As previously estimated, actual fourth quarter results indicate the Company's cash position increased during the fourth quarter by more than $8 million to $30.6 million in cash and short-term investments. At the same time, current liabilities have remained reasonably constant relative to the fourth quarter of fiscal 1996 while long-term debt relating to the acquisition of WordPerfect technologies continues to decline. The Company has not borrowed or required any additional financing throughout fiscal 1997. The carrying value of the Company's inventories at the end of the fourth quarter of fiscal 1997 has been reduced by more than 60% from its level at the end of the fourth quarter of fiscal 1996. Dr. Michael Cowpland, president and CEO commented: "While the results for the 1997 fiscal year are disappointing, the Company remains strong and well positioned for a successful 1998. In our continuing focus on core products, the Company divested a number of product categories in 1997 that did not directly support our key graphics and business productivity software lines. We see this as enhancing our ability to provide approximately 25 million users of CorelDraw and of the WordPerfect family of products with the most effective graphics and office productivity tools available. Our products continue to be well received in the marketplace. We are convinced that this strategy will keep us on the competitive edge, particularly in our growing corporate licensing market. Further, our significant ongoing investment in Java is now bringing us very close to the start of a new era in Webtop computing, that combines the power of Java, dynamic HTML and XML. As many leaders in our industry are acknowledging, the emergence of this new type of technology may be one of the most compelling events on the 1998 horizon and we are very excited about being at the forefront." This press release may contain certain statements that are forward looking as that term is defined in the US Private Securities Litigation Reform Act of 1995. --------------------------------------------------- These statements are based on current expectations that are subject to risks and uncertainties. Actual results will differ due to factors such as customer demand, product ship schedules, PC shipment growth, product mix, competitive products and pricing, technological shifts and other issues discussed in the company's Report on Form 10-K. Incorporated in 1985, Corel Corporation is recognized internationally as an award-winning developer and marketer of productivity applications, graphics and Internet software. Corel's product line includes CorelDRAW/TM/, Corel(R) WordPerfect(R) Suite, Corel(R) Office Professional, and Corel(R) WebMaster Suite. Corel's products run on most operating systems, including: Windows(R), Macintosh(R), UNIX, MS-DOS, and OpenVMS and are consistently rated among the strongest in the industry. The company ships its products in over 17 languages through a network of more than 160 distributors in 70 countries worldwide. Corel is traded on the Toronto Stock Exchange (symbol: COS) and the NASDAQ - National Market System (symbol: COSFF). For more information visit Corel's home page on the Internet at http://www.corel.com. -------------------- -30- Corel, WordPerfect, CorelDRAW, Corel VENTURA and Corel WebMaster Suite are trademarks or registered trademarks of Corel Corporation or Corel Corporation Limited. Windows is a registered trademark of Microsoft Corporation. Macintosh is a registered trademark of Apple Computer Corp. All other product and company names are trademarks or registered trademarks of their respective companies. COREL CORPORATION RESTATED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) QUARTER ENDED FEBRUARY 28, 1997 - ------------------------------------------------------------------------- CONSOLIDATED STATEMENTS OF OPERATIONS (US dollars, 000s omitted except per share data, unaudited) - -------------------------------------------------------------------------
QUARTER ENDED - ------------------------------------------------------------------------- FEBRUARY 28, 1997 February 29, 1996 - ------------------------------------------------------------------------- Sales $ 80,718 $ 36,423 Cost of sales 24,023 9,446 - ------------------------------------------------------------------------- Gross Profit 56,695 26,977 Expenses: Advertising 19,873 15,397 Selling, general and administrative 19,652 10,539 Research and development 18,823 8,219 Depreciation and amortization 6,894 3,671 Loss on foreign exchange 183 301 - ------------------------------------------------------------------------- 65,425 38,127 - ------------------------------------------------------------------------- Income (loss) from operations (8,730) (11,150) Interest expense (income) 501 (1,000) - ------------------------------------------------------------------------- Income (loss) before income taxes (9,231) (10,150) Income taxes 2,023 (3,551) - ------------------------------------------------------------------------- Net income (loss) $(11,254) $ (6,599) ========================================================================= EARNINGS PER SHARE: Net loss per common share Basic $ (0.19) $ (0.13) Fully diluted $ (0.16) $ (0.12) Average number of common shares outstanding (000s) Basic 60,068 49,605 Fully diluted 72,400 56,864
COREL CORPORATION RESTATED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) QUARTER ENDED FEBRUARY 28, 1997 - -------------------------------------------------------------------------------- CONSOLIDATED BALANCE SHEETS (US dollars, 000s omitted, unaudited) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- FEBRUARY 28, 1997 November 30, 1996 - -------------------------------------------------------------------------------- ASSETS Current assets: Cash and short-term investments $ 12,016 $ 6,924 Accounts receivable - Trade 118,955 135,338 - Other 1,669 1,341 Inventory 31,874 30,390 Income taxes recoverable 607 12 Deferred income taxes 4,190 2,940 Prepaid expenses 17,550 18,388 -------- -------- 186,861 195,333 Deferred income taxes 1,444 870 Capital assets 186,331 202,275 -------- -------- $374,636 $398,478 ======== ======== LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable $ 12,775 $ 17,592 Accrued liabilities 27,912 34,801 Current portion of long-term debt 15,888 15,500 Deferred revenue 8,426 6,495 -------- -------- 65,001 74,388 Long-term debt 30,388 33,830 Shareholders' equity: Share capital 203,194 202,953 Contributed surplus 352 352 Retained earnings 75,701 86,955 -------- -------- 279,247 290,260 -------- -------- $374,636 $398,478 ======== ========
COREL CORPORATION RESTATED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) QUARTER ENDED FEBRUARY 28, 1997 - -------------------------------------------------------------------------------- CONSOLIDATED STATEMENTS OF CHANGES IN FINANCIAL POSITION (US dollars, 000s omitted, unaudited) - -------------------------------------------------------------------------------- QUARTER ENDED - -------------------------------------------------------------------------------- FEBRUARY 28, 1997 February 29, 1996 - -------------------------------------------------------------------------------- Cash provided by (used for): Operations: Net income (loss) $ (11,254) $ (6,599) Items which do not involve cash: Depreciation and amortization 20,756 5,961 Loss (gain) on disposal of assets (1) 1,446 Deferred income taxes (1,824) (202) Changes in non-cash working capital 5,039 (18,975) --------- --------- 12,716 (18,369) ========= ========= Financing: Issue of share capital 241 4,638 Repayment of long-term debt (3,054) -- --------- --------- (2,813) 4,638 ========= ========= Investments: Purchase of capital assets (4,845) (9,220) Proceeds on disposal of assets 34 49 --------- --------- (4,811) (9,171) ========= ========= Net increase (decrease) in cash 5,092 (22,902) Cash at beginning of period 6,924 81,816 --------- --------- Cash at end of period $ 12,016 $ 58,914 ========= =========
COREL CORPORATION RESTATED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) QUARTER AND SIX MONTHS ENDED MAY 31, 1997 - ------------------------------------------------------------------------- CONSOLIDATED STATEMENTS OF OPERATIONS (US dollars, 000s omitted except per share data, unaudited) - -------------------------------------------------------------------------
QUARTER ENDED MAY 31 SIX MONTHS ENDED MAY 31 - -------------------------------------------------------------------------------------------------------------- 1997 1996 1997 1996 - -------------------------------------------------------------------------------------------------------------- Sales $ 87,413 $87,474 $ 168,131 $123,897 Cost of sales 18,828 21,748 42,851 31,194 - -------------------------------------------------------------------------------------------------------------- Gross Profit 68,585 65,726 125,280 92,703 Expenses: Advertising 20,529 22,674 40,402 38,071 Selling, general and administrative 22,059 20,180 41,711 30,719 Research and development 22,298 17,355 41,121 25,574 Depreciation and amortization 7,282 4,882 14,176 8,553 Write-down of purchased software and royalties 113,674 - 113,674 - Loss on foreign exchange 834 108 1,017 409 - -------------------------------------------------------------------------------------------------------------- 186,676 65,199 252,101 103,326 - -------------------------------------------------------------------------------------------------------------- Income (loss) from operations (118,091) 527 (126,821) (10,623) Interest expense (income) 337 (246) 838 (1,246) - -------------------------------------------------------------------------------------------------------------- Income (loss) before income taxes (118,428) 773 (127,659) (9,377) Income taxes (806) 267 1,217 (3,284) - -------------------------------------------------------------------------------------------------------------- Net income (loss) $(117,622) $ 506 $(128,876) $ (6,093) Retained earnings beginning of period 75,701 83,106 86,955 89,705 Premium on cancellation of shares (269) - (269) - - -------------------------------------------------------------------------------------------------------------- Retained earnings (deficit) end of period $ (42,190) $83,612 $ (42,190) $ 83,612 ============================================================================================================== EARNINGS PER SHARE: Net income (loss) per common share Basic $ (1.96) $ 0.01 $ (2.15) $ (0.11) Fully diluted $ (1.66) $ 0.01 $ (1.80) $ (0.10) Average number of common shares outstanding (000s) Basic 60,082 59,717 60,075 54,689 Fully diluted 70,844 69,393 71,613 63,163
COREL CORPORATION RESTATED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) QUARTER AND SIX MONTHS ENDED MAY 31, 1997 - -------------------------------------------------------------------------------- CONSOLIDATED BALANCE SHEETS (US dollars, 000s omitted, unaudited) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- MAY 31, 1997 November 30, 1996 - -------------------------------------------------------------------------------- ASSETS Current assets: Cash and short-term investments $ 20,634 $ 6,924 Accounts receivable - Trade 106,645 135,338 - Other 5,132 1,341 Inventory 25,009 30,390 Income taxes recoverable 10,389 12 Deferred income taxes 2,528 2,940 Prepaid expenses 4,173 18,388 -------- -------- 174,510 195,333 Deferred income taxes 239 870 Investment 1,633 -- Capital assets 77,911 202,275 -------- -------- $254,293 $398,478 ======== ======== LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable $ 14,806 $ 17,592 Accrued liabilities 28,188 34,801 Current portion of long-term debt 14,500 15,500 Deferred revenue 8,156 6,495 -------- -------- 65,650 74,388 Long-term debt 27,644 33,830 Shareholders' equity: Share capital 202,837 202,953 Contributed surplus 352 352 Retained earnings (deficit) (42,190) 86,955 -------- -------- 160,999 290,260 -------- -------- $254,293 $398,478 ======== ========
COREL CORPORATION RESTATED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) QUARTER AND SIX MONTHS ENDED MAY 31, 1997 - ----------------------------------------------------------------------------------------- CONSOLIDATED STATEMENTS OF CHANGES IN FINANCIAL POSITION (US dollars, 000s omitted, unaudited) - ----------------------------------------------------------------------------------------- QUARTER SIX MONTHS ENDED MAY 31 ENDED MAY 31 - ----------------------------------------------------------------------------------------- 1997 1996 1997 1996 - ----------------------------------------------------------------------------------------- Cash provided by (used for): Operations: Net income (loss) $(117,622) $ 506 $(128,876) $ (6,093) Items which do not involve cash: Depreciation and amortization 10,013 13,006 30,769 18,967 Loss (gain) on disposal of assets (60) 218 (61) 1,664 Deferred income taxes 2,867 (582) 1,043 (784) Write-down of purchased software and royalties 113,674 -- 113,674 -- Changes in non-cash working capital 12,528 (31,630) 17,567 (50,605) - ---------------------------------------------------------------------------------------- 21,400 (18,482) 34,116 (36,851) - ---------------------------------------------------------------------------------------- Financing: Issue of share capital 34 90,655 275 95,293 Shares purchased for cancellation (660) -- (660) -- Increase in long-term debt -- 55,000 -- 55,000 Repayment of long-term debt (4,132) -- (7,186) -- - ---------------------------------------------------------------------------------------- (4,758) 145,655 (7,571) 150,293 - ---------------------------------------------------------------------------------------- Investments: Purchase of investment (1,633) -- (1,633) -- Purchase of capital assets (6,445) (178,791) (11,290) (188,011) Proceeds on disposal of assets 54 199 88 248 - ---------------------------------------------------------------------------------------- (8,024) (178,592) (12,835) (187,763) - ---------------------------------------------------------------------------------------- Net increase (decrease) in cash 8,618 (51,419) 13,710 (74,321) Cash at beginning of period 12,016 58,914 6,924 81,816 - ---------------------------------------------------------------------------------------- Cash at end of period $ 20,634 $ 7,495 $ 20,634 $ 7,495 - ----------------------------------------------------------------------------------------
COREL CORPORATION RESTATED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) QUARTER AND NINE MONTHS ENDED AUGUST 31, 1997 - ------------------------------------------------------------------------- CONSOLIDATED STATEMENTS OF OPERATIONS (US dollars, 000s omitted except per share data, unaudited) - -------------------------------------------------------------------------
QUARTER ENDED AUGUST 31 NINE MONTHS ENDED AUGUST 31 - -------------------------------------------------------------------------------------------------------------- 1997 1996 1997 1996 - -------------------------------------------------------------------------------------------------------------- Sales $ 48,803 $ 84,942 $ 216,934 $208,839 Cost of sales 13,221 33,040 56,072 64,234 - -------------------------------------------------------------------------------------------------------------- Gross Profit 35,582 51,902 160,862 144,605 Expenses: Advertising 20,523 22,921 60,925 60,992 Selling, general and administrative 22,462 19,359 64,173 50,848 Gain on sale of CD Creator - (10,426) - (10,426) Research and development 22,433 19,611 63,554 44,415 Depreciation and amortization 7,419 5,483 21,595 14,036 Write-down of purchased software and royalties - - 113,674 - Loss (gain) on foreign exchange 402 (509) 1,419 (100) - -------------------------------------------------------------------------------------------------------------- 73,239 56,439 325,340 159,765 - -------------------------------------------------------------------------------------------------------------- Income (loss) from operations (37,657) (4,537) (164,478) (15,160) Interest expense (income) 152 (441) 990 (1,687) - -------------------------------------------------------------------------------------------------------------- Income (loss) before income taxes (37,809) (4,096) (165,468) (13,473) Income taxes (1,897) (895) (680) (4,179) - -------------------------------------------------------------------------------------------------------------- Net income (loss) $(35,912) $ (3,201) $(164,788) $ (9,294) Retained earnings (deficit) beginning of period (42,190) 83,612 86,955 89,705 Premium on cancellation of shares (100) - (369) - - -------------------------------------------------------------------------------------------------------------- Retained earnings (deficit) end of period $(78,202) $ 80,411 $ (78,202) $ 80,411 ============================================================================================================== EARNINGS PER SHARE: Net income (loss) per common share Basic $ (0.59) $ (0.05) $ (2.74) $ (0.16) Fully diluted $ (0.53) $ (0.05) $ (2.35) $ (0.14) Average number of common shares outstanding (000s) Basic 60,565 59,859 60,239 56,418 Fully diluted 67,270 69,754 70,155 65,368
COREL CORPORATION RESTATED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) QUARTER AND NINE MONTHS ENDED AUGUST 31, 1997 - -------------------------------------------------------------------------------- CONSOLIDATED BALANCE SHEETS (US dollars, 000s omitted, unaudited) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- AUGUST 31, 1997 November 30, 1996 - -------------------------------------------------------------------------------- ASSETS Current assets: Cash and short-term investments $ 22,481 $ 6,924 Accounts receivable - Trade 77,901 135,338 - Other 4,755 1,341 Inventory 25,684 30,390 Income taxes recoverable 8,345 12 Deferred income taxes 3,885 2,940 Prepaid expenses 3,011 18,388 -------- -------- 146,062 195,333 Deferred income taxes 405 870 Capital assets 72,525 202,275 -------- -------- $218,992 $398,478 ======== ======== LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable $ 7,760 $ 17,592 Accrued liabilities 32,967 34,801 Current portion of long-term debt 14,400 15,500 Deferred revenue 8,359 6,495 -------- -------- 63,486 74,388 Long-term debt 24,900 33,830 Shareholders' equity: Share capital 208,456 202,953 Contributed surplus 352 352 Retained earnings (deficit) (78,202) 86,955 -------- -------- 130,606 290,260 -------- -------- $218,992 $398,478 ======== ========
COREL CORPORATION RESTATED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) QUARTER AND NINE MONTHS ENDED AUGUST 31, 1997 - --------------------------------------------------------------------------------------------------------- CONSOLIDATED STATEMENTS OF CHANGES IN FINANCIAL POSITION (US dollars, 000s omitted, unaudited) - --------------------------------------------------------------------------------------------------------- QUARTER NINE MONTHS ENDED AUGUST 31 ENDED AUGUST 31 - --------------------------------------------------------------------------------------------------------- 1997 1996 1997 1996 - --------------------------------------------------------------------------------------------------------- Cash provided by (used for): Operations: Net income (loss) $(35,912) $ (3,201) $(164,788) $ (9,294) Items which do not involve cash: Depreciation and amortization 12,674 17,769 43,443 36,736 Loss (gain) on disposal of assets (57) 56 (118) 1,720 Deferred income taxes (1,523) (690) (480) (1,474) Write-down of purchased software and royalties -- -- 113,674 -- Write-down of investments 1,633 -- 1,633 -- Changes in non-cash working capital 29,588 (4,027) 47,155 (54,632) - --------------------------------------------------------------------------------------------------------- 6,403 9,907 40,519 (26,944) - --------------------------------------------------------------------------------------------------------- Financing: Issue of share capital 5,761 793 6,036 96,086 Shares purchased for cancellation (242) -- (902) -- Increase in long-term debt -- -- -- 55,000 Repayment of long-term debt (2,844) (2,059) (10,030) (2,059) - --------------------------------------------------------------------------------------------------------- 2,675 (1,266) (4,896) 149,027 - --------------------------------------------------------------------------------------------------------- Investments: Purchase of investment -- -- (1,633) -- Purchase of capital assets (7,291) (13,927) (18,581) (201,938) Proceeds on disposal of assets 60 4 148 252 - --------------------------------------------------------------------------------------------------------- (7,231) (13,923) (20,066) (201,686) - --------------------------------------------------------------------------------------------------------- Net increase (decrease) in cash 1,847 (5,282) 15,557 (79,603) Cash at beginning of period 20,634 7,495 6,924 81,816 - --------------------------------------------------------------------------------------------------------- Cash at end of period $ 22,481 $ 2,213 $ 22,481 $ 2,213 =========================================================================================================
COREL CORPORATION CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) QUARTER AND YEAR ENDED NOVEMBER 30, 1997 - ------------------------------------------------------------------------- CONSOLIDATED STATEMENTS OF OPERATIONS (US dollars, 000s omitted except per share data, unaudited) - -------------------------------------------------------------------------
QUARTER ENDED NOVEMBER 30 YEAR ENDED NOVEMBER 30 - -------------------------------------------------------------------------------------------------------------- 1997 1996 1997 1996 - -------------------------------------------------------------------------------------------------------------- Sales $ 43,647 $125,406 $ 260,581 $334,245 Cost of sales 28,064 36,860 84,136 101,094 - -------------------------------------------------------------------------------------------------------------- Gross Profit 15,583 88,546 176,445 233,151 Expenses: Advertising 18,636 31,690 79,561 92,682 Selling, general and administrative 20,307 20,941 84,480 71,019 Gain on sale of CD Creator - - - (10,426) Research and development 25,945 20,742 89,499 65,927 Depreciation and amortization 4,680 5,045 26,275 19,081 Write-down of purchased software and royalties 3,838 - 117,512 - Loss (gain) on foreign exchange (655) (41) 764 (141) - -------------------------------------------------------------------------------------------------------------- 72,751 78,377 398,091 238,142 - -------------------------------------------------------------------------------------------------------------- Income (loss) from operations (57,168) 10,169 (221,646) (4,991) Interest expense (income) 164 296 1,154 (1,391) - -------------------------------------------------------------------------------------------------------------- Income (loss) before income taxes (57,332) 9,873 (222,800) (3,600) Income taxes 9,558 3,329 8,878 (850) - -------------------------------------------------------------------------------------------------------------- Net income (loss) $ (66,890) $ 6,544 $(231,678) $ (2,750) Retained earnings (deficit) beginning of period (78,202) 80,411 86,955 89,705 Premium on cancellation of shares (64) - (433) - - -------------------------------------------------------------------------------------------------------------- Retained earnings (deficit) end of period $(145,156) $ 86,955 $(145,156) $ 86,955 ============================================================================================================== EARNINGS PER SHARE: Net income (loss) per common share Basic $ (1.10) $ 0.11 $ (3.84) $ (0.05) Fully diluted $ (1.00) $ 0.09 $ (3.34) $ (0.04) Average number of common shares outstanding (000s) Basic 60,623 59,920 60,297 57,289 Fully diluted 66,772 70,649 69,272 66,681
COREL CORPORATION CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) QUARTER AND YEAR ENDED NOVEMBER 30, 1997 - -------------------------------------------------------------------------------- CONSOLIDATED BALANCE SHEETS (US dollars, 000s omitted, unaudited) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- NOVEMBER 30, 1997 November 30, 1996 - -------------------------------------------------------------------------------- ASSETS Current assets: Cash and short-term investments $ 30,629 $ 6,924 Accounts receivable - Trade 50,951 135,338 - Other 2,310 1,341 Inventory 11,412 30,390 Income taxes recoverable -- 12 Deferred income taxes 2,353 2,940 Prepaid expenses 2,591 18,388 --------- -------- 100,246 195,333 Deferred income taxes -- 870 Capital assets 63,497 202,275 --------- -------- $ 163,743 $398,478 ========= ======== LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable $ 13,840 $ 17,592 Accrued liabilities 34,223 34,801 Current portion of long-term debt 13,500 15,500 Income taxes payable 4,203 -- Deferred revenue 14,124 6,495 --------- -------- 79,890 74,388 Long-term debt 24,044 33,830 Shareholders' equity: Share capital 204,235 202,953 Contributed surplus 730 352 Retained earnings (deficit) (145,156) 86,955 --------- -------- 59,809 290,260 --------- -------- $ 163,743 $398,478 ========= ========
COREL CORPORATION CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) QUARTER AND YEAR ENDED NOVEMBER 30, 1997 - ------------------------------------------------------------------------------------------------------------------- CONSOLIDATED STATEMENTS OF CHANGES IN FINANCIAL POSITION (US dollars, 000s omitted, unaudited) - ------------------------------------------------------------------------------------------------------------------- QUARTER YEAR ENDED NOVEMBER 30 ENDED NOVEMBER 30 - ------------------------------------------------------------------------------------------------------------------- 1997 1996 1997 1996 - ------------------------------------------------------------------------------------------------------------------- Cash provided by (used for): Operations: Net income (loss) $(66,890) $ 6,544 $(231,678) $ (2,750) Items which do not involve cash: Depreciation and amortization 8,839 19,817 52,282 58,553 Loss (gain) on disposal of assets (288) (11) (406) 1,709 Deferred income taxes 1,937 (4,831) 1,457 (6,305) Write-down of purchased software and royalties 3,838 -- 117,512 -- Changes in non-cash working capital 68,371 (4,412) 115,526 (59,044) - ------------------------------------------------------------------------------------------------------------------- 15,807 17,107 54,693 (9,837) - ------------------------------------------------------------------------------------------------------------------- Financing: Issue of share capital 170 1,066 6,206 97,152 Shares purchased for cancellation (4,077) -- (4,979) -- Increase in long-term debt -- -- -- 55,000 Repayment of long-term debt (1,756) (3,611) (11,786) (5,670) - ------------------------------------------------------------------------------------------------------------------- (5,663) (2,545) (10,559) 146,482 - ------------------------------------------------------------------------------------------------------------------- Investments: Purchase of capital assets (4,842) (9,879) (23,423) (211,817) Proceeds on disposal of assets 2,846 28 2,994 280 - ------------------------------------------------------------------------------------------------------------------- (1,996) (9,851) (20,429) (211,537) - ------------------------------------------------------------------------------------------------------------------- Net increase (decrease) in cash 8,148 4,711 23,705 (74,892) Cash at beginning of period 22,481 2,213 6,924 81,816 - ------------------------------------------------------------------------------------------------------------------- Cash at end of period $ 30,629 $ 6,924 $ 30,629 $ 6,924 ===================================================================================================================
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