AVANTGO REPORTS FIRST QUARTER 2002 FINANCIAL RESULTS
Mobile Applications Strategy Progresses with Major Wins from Fortune 1000 Customers
Hayward, Calif., April 24, 2002 - AvantGo, Inc. (Nasdaq: AVGO), the leading provider of mobile enterprise software, today reported financial results for the first quarter ended March 31, 2002.
For the first quarter of 2002, the Company posted revenues of $4.8 million and a pro forma net loss of $5.0 million, or a loss of $0.14 per share. This compares to revenues of $5.3 million and a pro forma net loss of $4.7 million, or a loss of $0.14 per share, reported in the fourth quarter of 2001. The Company reported an actual net loss of $5.7 million, or a loss of $0.16 per share, for the first quarter of 2002, which compares to an actual net loss of $8.2 million, or a loss of $0.24 per share, for the fourth quarter of 2001.
The Company sequentially reduced operating expenses by 6% from $9.2 million in the fourth quarter of 2001 to $8.6 million in the first quarter of 2002, and by 45%, or $7.0 million, from $15.6 million in the first quarter 2001, excluding pro forma charges. At March 31, 2002, the Company had $42.1 million of cash and cash equivalents, reflecting the sixth consecutive quarter of reduced cash burn.
"Although the overall market for enterprise software continues to be soft, we won major deals for Mobile Sales™ and a mission-critical supply chain automation solution, adding to our growing list of Fortune 1000 customers and supporting our focus on high-value, high ROI mobile applications. In April, we have already concluded a major contract, and based on our pipeline, we anticipate modest revenue growth in the second quarter," commented Richard Owen, chief executive officer, of AvantGo. "Our strategy of building upon our best-of-breed infrastructure software to quickly bring high-value mobile applications to market has yielded early success, and we believe positions us well for the long term.
"Corporations are increasingly realizing that our solutions deliver high ROI, minimize technology obsolescence, minimize their reliance on costly wireless services and deliver always-available access to critical information whether or not a network is available," Owen added.
Pro forma charges excluded from the first quarter of 2002 results included the amortization of deferred compensation of $0.7 million. Pro forma charges excluded from the fourth quarter of 2001 results totaled $3.5 million and included the amortization of goodwill, intangible assets and deferred compensation and other acquisition-related costs of $1.0 million, restructuring and other impairment charges related to the disposal of excess office space of $1.7 million, and employee termination costs of $0.8 million.
AvantGo Introduces Two New Applications
AvantGo has expanded its suite of mobile applications with the introduction of two new applications, AvantGo Mobile Pharma™ and AvantGo Mobile Inspection™, targeting the pharmaceutical and government markets.
In March, the Company introduced AvantGo Mobile Pharma, a packaged mobile application specifically designed to support the unique requirements of pharmaceutical sales representatives. AvantGo Mobile Pharma is a powerful mobile application designed to help pharmaceutical companies gain market share by significantly improving the quality of their interactions with physicians and increasing the productivity of sales representatives. The mobile application provides sales representatives with immediate access to the information most relevant to them, including their sales force automation (SFA) system, product and clinical data, market share data, corporate data and web-based content and services from mobile devices.
AvantGo also recently unveiled AvantGo Mobile Inspection, a packaged mobile application designed to improve business inefficiencies in performing inspection, asset tracking, loss prevention, safety and environmental audit tasks. The solution eliminates transcription errors and improves the timeliness and quality of data collection. It also streamlines workflow by electronically transmitting results directly from the field and providing managers with the information they need to make timely, more informed operational decisions.
With these new applications, AvantGo further expands its broad suite of mobile solutions. AvantGo today provides server-based synchronization and online access to Microsoft Exchange and Lotus Notes schedules, contacts, tasks and e-mail, mission-critical custom applications written using Lotus Notes or other web-based development tools. In addition, AvantGo infrastructure now provides the foundation for packaged business applications including Mobile Sales, Mobile Delivery, Mobile Pharma and Mobile Inspection, enabling global organizations to standardize on a single infrastructure solution for both packaged and custom mobile applications.
AvantGo Investor Call
AvantGo's first quarter financial results will be discussed on April 24, 2002 at 2:00 p.m. PT/5:00 p.m. ET, and will be available via a live webcast on the Company's website, under the navigation bar "investor relations," or at www.streetevents.com. A replay also will be available from the Company's website through May 8, 2002.
About AvantGo
AvantGo, Inc. (Nasdaq: AVGO) is the leading provider of mobile enterprise software. AvantGo solutions automate business processes and improve the exchange of information between companies and their employees and customers, resulting in improved business efficiencies and more effective customer interactions. AvantGo solutions include the best-of-breed mobile software platform for creating and deploying enterprise applications, proven customer relationship management (CRM), supply chain management (SCM) and personal information management (PIM) mobile business applications, and professional services to assist in the strategy, design and delivery of end-to-end mobile solutions. AvantGo's customers, which include 28 of the Fortune 100 and over 2500 companies in 50 countries, include McKesson Corporation, Ford Motor Company, Cisco Systems, FedEx, Scottish Power, The US Senate, Tyco, Harvard Medical School, American Express, The World Economic Forum, BG Group, plc., Genencor and Alcatel. For more information, please visit www.avantgo.com.
Cautionary Statement
This news release regarding first quarter financial results includes forward-looking statements, including, but not limited to, revenue projections for next quarter and AvantGo's ability to maintain sufficient cash balances to cover future operations until reaching profitability. These forward looking statements are subject to a number of risks, uncertainties and other factors that could cause actual results to differ materially. Such factors include, but are not limited to, the following: the growth in the adoption of mobile infrastructure technology; the Company's ability to fund its operations with existing cash or by raising additional capital; risks related to market acceptance of AvantGo's products and services, and the products and services of AvantGo's customers and partners which integrate or interoperate with AvantGo technologies; the rates at which advertisers invest in mobile advertising; possible disruption in commercial activities occasioned by terrorist activity and armed conflict, such as changes in logistics and security arrangements, and reduced end-user purchases relative to expectations; quarterly fluctuations in AvantGo's revenues or other operating results; pricing pressures, including the pricing that content providers and advertisers are willing to pay us in connection with our AvantGo mobile Internet service; the pricing of AvantGo enterprise products and the rates that we are able to charge for AvantGo professional services; errors in forecasting or inability to meet sales goals; inability to control costs; customer dissatisfaction; failure to close anticipated key enterprise agreements; slowdown in the adoption of mobile devices for which the market for AvantGo's software and services is dependent; changes in customer order patterns; the impact of long sales and implementation cycles for AvantGo's enterprise products; AvantGo's failure to meet financial expectations of analysts and investors; unanticipated costs or other adverse effects associated with software bugs; continued success in technological advances, including development and implementation of new products and services that are interoperable with those of its customers and partners; delays in the development or introduction of such products and services; AvantGo's ability to manage growth and successfully integrate and operate any acquired businesses; AvantGo's ability to further its brand awareness and market effectively the functionality of its software; the risk of a significant monetary judgment against AvantGo in the current shareholder lawsuit or in any future litigation in which AvantGo may be named as a defendant; competitive factors, such as the release of competitive products and services; marketing programs and other actions by competitors; technical difficulties with networks or operating systems on which we rely to deliver some of AvantGo services; AvantGo's need to maintain and enhance business relationships with leading hardware and software manufacturers, important partners, content providers and other parties; the ability of AvantGo partners and customers to timely develop and deliver to market viable products and services; AvantGo's ability to attract new employees, particularly in the sales and engineering groups; retention of key personnel; AvantGo's activities and those of others regarding protection of intellectual property; vulnerability of the AvantGo Mobile Internet Service to events which may result in the inability of our sole bandwidth vendor to provide bandwidth services, such as loss of power, facility shutdown, break-ins, vandalism, terrorist acts, fire, floods, or earthquakes; the risk of AvantGo's failure to meet the continued listing requirements of the Nasdaq Stock Market which may result in delisting of AvantGo stock; other factors which increase operating costs; rapid inflation; general economic downturns; general business and economic conditions; and the impact of events outside the United States such as the business impact of fluctuating currency rates or unrest or political instability in a locale.
Further details on these risks are set forth in the AvantGo Inc. filings with the Securities and Exchange Commission, including the annual report filed on Form 10-K for the year ended December 31, 2001 and the quarterly report on Form 10-Q for the quarter ended September 30, 2001. These filings are available on a website maintained by the Securities and Exchange Commission at http://www.sec.gov. Forward-looking statements in this release are generally identified by words such as "forecast," "project," "expect," "anticipate,"' "intend," "believe," "assume," "estimate,'' "goal," "plan'' and other similar words and expressions. AvantGo does not undertake an obligation to update forward-looking statements.
For more information, contact:
Karen Logsdon
AvantGo, Inc.
(510) 259-4054
klogsdon@avantgo.com
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