-----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, Ni+d6zB5yISilLlcuRuGzfpxvx+X53z6QTagdkTnQP0ODSFksbrpF+EA6qiaUw8S MxP4kCPDQxOswexbw4ThZQ== 0000950123-04-013628.txt : 20041115 0000950123-04-013628.hdr.sgml : 20041115 20041115154843 ACCESSION NUMBER: 0000950123-04-013628 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20040804 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20041115 DATE AS OF CHANGE: 20041115 FILER: COMPANY DATA: COMPANY CONFORMED NAME: VIEWPOINT CORP CENTRAL INDEX KEY: 0000919794 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-PREPACKAGED SOFTWARE [7372] IRS NUMBER: 954102687 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-27168 FILM NUMBER: 041145031 BUSINESS ADDRESS: STREET 1: 498 SEVENTH AVENUE STREET 2: SUITE 1810 CITY: NEW YORK STATE: NY ZIP: 10018 BUSINESS PHONE: 212-201-0800 MAIL ADDRESS: STREET 1: 498 SEVENTH AVENUE STREET 2: SUITE 1810 CITY: NEW YORK STATE: NY ZIP: 10018 FORMER COMPANY: FORMER CONFORMED NAME: VIEWPOINT CORP/NY/ DATE OF NAME CHANGE: 20001201 FORMER COMPANY: FORMER CONFORMED NAME: METACREATIONS CORP DATE OF NAME CHANGE: 19970529 FORMER COMPANY: FORMER CONFORMED NAME: HSC SOFTWARE CORP DATE OF NAME CHANGE: 19951019 8-K 1 y68812ye8vk.txt VIEWPOINT CORPORATION 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) August 4, 2004 VIEWPOINT CORPORATION (Exact name of registrant as specified in its charter) Delaware 0-27168 95-4102687 - -------- ------- ---------- (state or other juris- (Commission (I.R.S. Employer diction of incorporation) File Number) (Identification No.) 498 Seventh Avenue, Suite 1810, New York, NY 10018 - -------------------------------------------- ----- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (212) 201-0800 -------------- N/A - -------------------------------------------------------------------------------- (Former name or former address, if changed since last report) ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION On August 4, 2004, the Registrant issued a press release regarding its results of operations for its fiscal first quarter ended June 30, 2004. A copy of the press release issued by the Registrant is furnished herewith as Exhibit 99.1. ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS. (c) Exhibits 99.1 Press Release, dated August 4, 2004 The information furnished herein and in the accompanying exhibit shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 nor shall it be deemed incorporated by reference in any other filing with the Securities and Exchange Commission except as is expressly set forth by specific reference in such a filing. SIGNATURES 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. VIEWPOINT CORPORATION /s/ William H. Mitchell ------------------------------ William H. Mitchell Chief Financial Officer Dated: November 15, 2004 EX-99.1 2 y68812yexv99w1.txt PRESS RELEASE EXHIBIT 99.1 VIEWPOINT CORPORATION ANNOUNCES SECOND QUARTER 2004 FINANCIAL RESULTS New York, NY - August 4, 2004 - Viewpoint Corporation (NASDAQ: VWPT), a leading provider of Internet graphics and delivery systems, today announced financial results for the second quarter and six months ended June 30, 2004. Viewpoint reported total revenue of $2.8 million for the second quarter 2004, compared to $3.6 million in the first quarter 2004 and $4.5 million in the second quarter 2003. Gross profit was $2.0 million for the second quarter of 2004, compared to $2.8 million in the first quarter of 2004 and $2.1 million for the second quarter of 2003. During the first quarter of 2004, the company recognized $500,000 of revenue for payment of a project that had been completed and expensed in the third quarter of 2003. This was responsible for a substantial portion of the sequential decrease in gross profit. Operating loss for the second quarter of 2004 was $1.9 million compared to a loss of $1.2 million in the first quarter 2004 and a loss of $4.9 million in the second quarter of 2003. Net income for the second quarter 2004 was $0.8 million, or $0.01 per share, compared to a net loss of $8.6 million, or $(0.17) per share, in the first quarter 2004 and $6.3 million, or $(0.14) per share, in the second quarter of 2003. The net income in the 2004 second quarter reflects the impact of a stock price decrease on the company's 2003 convertible debt and warrant financing that resulted in a $3.1 million increase in net income. During the first quarter of 2004, there had been an expense of $6.6 million due to an increase in the company stock price. Similarly, an expense of $1.1 million had been incurred because of a stock price increase in the second quarter of 2003. For the six months ended June 30, 2004, the Company reported revenues of $6.4 million, compared to $8.5 million for the same period in 2003. Viewpoint's operating expenses for the six-month period was $7.9 million as of June 30, 2004, compared with $16.0 million as of June 30, 2003. The 51%, or $8.1 million, decrease in operating expenses was principally the result of cost reduction efforts put in place by management during 2003 that led to a decrease of $4.8 million in ongoing cash expense categories. Decreases in non-cash stock based compensation charges of $1.6 million and restructuring of $1.2 million were responsible for most of the remaining savings. The Company's net loss for the six months ended June 30, 2004 of $7.9 million, or $(0.15) per share, was based on a loss from operations of $3.1 million, which included charges of $0.3 million for non-cash stock based compensation and $0.4 million for depreciation and amortization. This compares to a net loss for the six months ended June 30, 2003 of $12.8 million, or $(0.29) per share, based on a loss from operations of $11.1 million, which included charges of $1.9 million for non-cash stock-based compensation, $0.9 million of depreciation and amortization, and a $1.2 million charge related to an office closure. Viewpoint's cash, cash equivalents, and marketable securities as of June 30, 2004 were $8.5 million. This can be compared to cash, cash equivalents, and marketable securities of $9.5 million as of December 31, 2003. - MORE - "Despite the decline in gross profit, most of which was due to the unusual $500,000 revenue item in the first quarter associated with work performed in a prior year, we continued to make progress toward our goal of long term profitability" stated William H. Mitchell, Chief Financial Officer. "We recognized our first revenue from our Creative innovator product. Additionally, we improved our long term financing position by converting our convertible notes to 1.7 million shares of common stock. We also had some modest reductions in operating expenses. It should be noted that our results do not include an estimated $82,000 in revenue from our search business during the quarter because reports of revenue from our search results provider are reported in estimated amounts and are therefore not `fixed and determinable' under GAAP (generally accepted accounting principles). While we would have liked to have seen higher revenues, we believe we are making progress toward our goal of a positive run-rate of EBITDA (earnings before interest, depreciation, taxes, and amortization) by year-end." Jay Amato, President and Chief Executive Officer commented "During the second quarter and the month of July we have continued to make progress toward our goals. This has included the endorsement of our core products from world-class companies such as Samsung, General Electric, HP-Compaq and Sony as well as healthy search revenue growth." Amato continued, "Metrics related to the Viewpoint Toolbar continue to show positive results. Through today, approximately 1.9 million users have installed the Toolbar and the vast majority of Version 1.0 users have upgraded to Version 2.0. During the month of July our estimated net revenue per installed bar was $0.11, compared to a monthly average of $0.04 for the entire second quarter. This is attributable to an increase in searches completed using the bar due to improvements in the Toolbar's speed and usability as well as enhancement of features and functionality. While there can be no assurance that our long term average revenues will remain at nearly three times the previous run rate, we believe there are grounds for optimism." Mr. Amato continued, "Although we continue to receive positive feedback on both Creative Innovator and AirTime, there are longer sales cycles relating to these products as the paradigms around Web advertising continue to evolve. We have taken steps to accelerate the trial and close process for CI with new customers while keeping sales and marketing costs to a minimum. We remain optimistic about the future revenue potential of these products as Viewpoint is at the forefront of the continuing shift from traditional advertising to online advertising with two of the most dynamic, innovative products offered today." Mr. Amato concluded, "Our progress during the quarter is another important step in our long-term strategy. We achieved several milestones while delivering on our commitments to operate efficiently and eliminating $1.8 million in debt. During the second half of 2004, the Viewpoint team believes that it can continue to deliver enhanced product offerings, reduced operating expenses, and achieve positive EBITDA run-rate by year-end." CONFERENCE CALL The Company will host a conference call on August 4, 2004 at 9:00 A.M. (Eastern Time) to discuss second quarter 2004 financial results. The conference call will be available via the Internet in the Investor Relations section of Viewpoint's Web site at http://www.viewpoint.com, as well as through CCBN at www.companyboardroom.com. If you are not able to access the live Web cast, dial in information is as follows: Toll-Free Telephone Number: (800) 603-7883 International Telephone Number: (706) 643-1946 Pass code: 8398214 Participants should call at least 10 minutes prior to the start of the call. A complete replay of the conference call will be available approximately one hour after the completion of the call by dialing (800) 642-1687 through Wednesday, August 11, 2004. Callers should enter the pass code above to access the recording. ABOUT VIEWPOINT The Viewpoint Platform is the technology behind some of the most innovative, visual experiences on the Web and on the desktop with leading clients such as America Online, General Electric, General Motors, HP-Compaq, IBM, Lexus, Microsoft, Samsung, Scion, Toyota, and Sony. Creative Innovator - the Company's next-generation ad deployment and management system - and the Viewpoint Toolbar - - the Vision for the Future of Search - are the latest breakthrough technologies using the full power of the Viewpoint Platform. Viewpoint Corporation has 100 employees at its headquarters in New York City and in San Francisco, Los Angeles, Chicago, and Detroit. FORWARD LOOKING STATEMENT This press release may contain "forward-looking" statements as that term is defined in the Private Securities Litigation Reform Act of 1995 and similar expressions that reflect Viewpoint's current expectations about its future performance. These statements and expressions are subject to risks, uncertainties and other factors that could cause Viewpoint's actual performance to differ materially from those expressed in, or implied by, these statements and expressions. Such risks, uncertainties and factors include those described in the Company's filings and reports on file with the Securities and Exchange Commission as well as the lack of assurances that Viewpoint will accelerate the trial and close process for its Creative Innovator and Airtime products with new customers while keeping sales and marketing costs to a minimum; that Viewpoint will earn revenue from Creative Innovator and Airtime in the future; that Viewpoint can continue to deliver enhanced product offerings and reduced operating expenses during the second half of 2004; or that Viewpoint can achieve a positive operating profit run-rate by year-end. Viewpoint and Airtime are either registered trademarks or trademarks of Viewpoint Corporation. Other product and company names herein may be trademarks of their respective owners. Copyright 2004 Viewpoint Corporation. All rights reserved. -TABLES FOLLOW- VIEWPOINT CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) (UNAUDITED)
THREE MONTHS ENDED JUNE 30, MARCH 31, --------------------- -------- 2004 2003 2004 -------- -------- -------- Revenues: Licenses ............................................................ $ 144 $ 217 $ 240 Related party licenses .............................................. 872 1,010 907 Services ............................................................ 1,066 842 1,523 Related party services .............................................. 686 2,405 914 Creative Innovator .................................................. 37 - - -------- -------- -------- TOTAL REVENUES ........................................................ 2,805 4,474 3,584 -------- -------- -------- Cost of revenues: Licenses ............................................................ 3 28 1 Services ............................................................ 792 2,372 751 Creative Innovator .................................................. 6 - - -------- -------- -------- TOTAL COST OF REVENUES ................................................ 801 2,400 752 -------- -------- -------- GROSS PROFIT .......................................................... 2,004 2,074 2,832 -------- -------- -------- Operating expenses: Sales and marketing ................................................. 944 2,227 1,032 Research and development ............................................ 860 667 864 General and administrative .......................................... 1,790 2,775 1,724 Non-cash stock-based compensation charges ........................... 56 858 226 Depreciation ........................................................ 205 444 219 Amortization of intangible assets ................................... 1 7 3 Restructuring charges ............................................... - - (17) -------- -------- -------- TOTAL OPERATING EXPENSES .............................................. 3,856 6,978 4,051 -------- -------- -------- LOSS FROM OPERATIONS .................................................. (1,852) (4,904) (1,219) -------- -------- -------- Other income (expense): Interest and other income, net ...................................... 27 11 19 Interest expense .................................................... (236) (323) (250) Loss on conversion of debt .......................................... (212) - (598) Changes in fair values of warrants to purchase common stock and conversion options of convertible notes ................... 3,050 (1,081) (6,603) -------- -------- -------- TOTAL OTHER INCOME (EXPENSE) .......................................... 2,629 (1,393) (7,432) -------- -------- -------- INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES ....................... 777 (6,297) (8,651) Provision for income taxes ............................................ 25 13 10 -------- -------- -------- NET INCOME (LOSS) FROM CONTINUING OPERATIONS .......................... 752 (6,310) (8,661) Adjustment to net income (loss) on disposal of discontinued Operations ......................................................... 20 26 19 -------- -------- -------- NET INCOME (LOSS) ..................................................... $ 772 $ (6,284) $ (8,642) -------- -------- -------- Basic net income (loss) per common share .............................. $ 0.01 $ (0.14) $ (0.17) Diluted net income (loss) per common share ............................ $ 0.01 $ (0.14) $ (0.17) Weighted average number of shares outstanding ......................... 52,651 45,986 50,215 ======== ======== ======== Weighted average number of shares outstanding -- assuming dilution .... 56,740 45,986 50,215 ======== ======== ========
VIEWPOINT CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) (UNAUDITED)
SIX MONTHS ENDED JUNE 30, --------------------- 2004 2003 -------- -------- Revenues: Licenses ......................................................... $ 384 $ 1,849 Related party licenses ........................................... 1,779 1,060 Services ......................................................... 2,589 2,197 Related party services ........................................... 1,600 3,393 Creative Innovator ............................................... 37 - -------- -------- TOTAL REVENUES ..................................................... 6,389 8,499 -------- -------- Cost of revenues: Licenses ......................................................... 4 75 Services ......................................................... 1,543 3,548 Creative Innovator ............................................... 6 - -------- -------- TOTAL COST OF REVENUES ............................................. 1,553 3,623 -------- -------- GROSS PROFIT ....................................................... 4,836 4,876 -------- -------- Operating expenses: Sales and marketing .............................................. 1,976 5,609 Research and development ......................................... 1,724 1,646 General and administrative ....................................... 3,514 4,714 Non-cash stock-based compensation charges ........................ 282 1,868 Depreciation ..................................................... 424 922 Amortization of intangible assets ................................ 4 8 Restructuring and impairment charges related to office Closure ....................................................... (17) 1,211 -------- -------- TOTAL OPERATING EXPENSES ........................................... 7,907 15,978 -------- -------- LOSS FROM OPERATIONS ............................................... (3,071) (11,102) -------- -------- Other income (expense): Interest and other income, net ................................... 46 34 Interest expense ................................................. (486) (486) Loss on early extinguishment of debt ............................. - (1,682) Loss on conversion of debt ....................................... (810) - Changes in fair values of warrants to purchase common stock and conversion options of convertible notes .............. (3,553) 343 -------- -------- TOTAL OTHER INCOME (EXPENSE) ....................................... (4,803) (1,791) -------- -------- LOSS BEFORE PROVISION FOR INCOME TAXES ............................. (7,874) (12,893) Provision for income taxes ......................................... 35 13 -------- -------- NET LOSS FROM CONTINUING OPERATIONS ................................ (7,909) (12,906) Adjustment to net loss on disposal of discontinued operations .................................................... 39 116 -------- -------- NET LOSS ........................................................... $ (7,870) $(12,790) ======== ======== BASIC AND DILUTED NET LOSS PER COMMON SHARE: Net loss per common share from continuing operations ............. $ (0.15) $ (0.29) Net income per common share from discontinued operations .................................................... 0.00 0.00 -------- -------- NET LOSS PER COMMON SHARE .......................................... $ (0.15) $ (0.29) ======== ======== WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING -- BASIC AND DILUTED ................................................... 51,433 43,688 ======== ========
VIEWPOINT CORPORATION CONSOLIDATED BALANCE SHEETS (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) (UNAUDITED)
JUNE 30, DECEMBER 31, 2004 2003 --------- --------- ASSETS Current assets: Cash and cash equivalents ............................... $ 1,759 $ 8,530 Marketable securities ................................... 6,768 958 Accounts receivable, net ................................ 961 650 Related party accounts receivable, net .................. 54 914 Prepaid expenses and other current assets ............... 416 694 --------- --------- Total current assets ............................ 9,958 11,746 Restricted cash ........................................... 319 388 Property and equipment, net ............................... 1,603 1,859 Goodwill, net ............................................. 31,276 31,276 Intangible assets, net .................................... 220 186 Other assets .............................................. 208 288 --------- --------- TOTAL ASSETS .................................... $ 43,584 $ 45,743 ========= ========= LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable ........................................ $ 915 $ 1,177 Accrued expenses ........................................ 843 1,094 Deferred revenues ....................................... 312 423 Related party deferred revenues ......................... 4,974 4,952 Accrued incentive compensation .......................... 545 545 Current liabilities related to discontinued operations... 231 231 --------- --------- Total current liabilities ....................... 7,820 8,422 Accrued expenses .......................................... 388 400 Related party deferred revenues ........................... 2,253 4,706 Convertible notes ......................................... - 2,837 Warrants to purchase common stock ......................... 659 110 Subordinated notes ........................................ 2,068 1,801 --------- --------- Total liabilities .............................. 13,188 18,276 Stockholders' equity: Preferred stock ........................................ - - Common stock .............................................. 54 50 Paid-in capital ........................................... 284,891 274,351 Deferred compensation ..................................... (8) (275) Treasury stock ............................................ (1,015) (1,015) Accumulated other comprehensive loss ...................... (77) (65) Accumulated deficit ....................................... (253,449) (245,579) --------- --------- Total stockholders' equity ...................... 30,396 27,467 --------- --------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY ...... $ 43,584 $ 45,743 ========= =========
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