iPrint Revenue Down from Last Quarter, Down Substantially from Last Year
Tuesday, July 31, 2001
MENLO PARK, Calif.- July 30, 2001--iPrint Technologies, inc., the leading online printing technology and infrastructure provider, today announced revenues of $2.5 million for the second fiscal quarter of 2001 (editors note: down from $4.5 million in second fiscal quarter of 2000 and down from $3.2 million in first fiscal quarter of 2001.) Pro-forma net loss for the second quarter was $3.5 million, or a loss of $0.12 per share, compared with a pro-forma net loss of $5.5 million, or $0.18 per share, in the first quarter of 2001, and a pro-forma net loss of $9.1 million, or $0.30 per share, in the second quarter of 2000. On a comparative basis, the pro-forma net loss for the second quarter beat the unrevised First Call consensus estimate of a net loss of $0.15 per share by $0.03. Pro-forma net loss and pro-forma net loss per share excludes non-cash compensation charges and corporate restructure costs. "Besides cost cutting and focusing on higher quality revenues, our Q2 was all about reaching a definitive agreement with our merger partner Wood Associates,'' stated Royal P. Farros, Chairman and CEO of iPrint Technologies, inc. "We believe that combining Wood's 200 enterprise customers and solid revenue stream with iPrint's award-winning technology and robust operating infrastructure will give us the future growth profile that our shareholders expect. We are very excited about this combination.'' On June 25, 2001, iPrint announced that it had entered into a definitive agreement to merge with Wood Associates, one of the leading suppliers of custom imprinted promotional items and marketing programs to the Fortune 1000. With 19 offices nationwide, Wood Associates services over 200 Fortune 1000 enterprise customers, including AOL Time Warner, BP, Charles Schwab, and Compaq. "Our overriding mission continues to be building a solid, profitable company,'' added Farros. "Penetrating the enterprise space will help us meet this goal and the Wood merger is an accelerator for us in this regard. That's why we made forging this relationship our most important priority in Q2.'' Cash, short-term investments and short-term restricted cash totaled $18.2 million as of June 30, 2001, $19.1 million including secured, long-term notes payable to the company on demand, compared to $23.1 million as of March 31, 2001. As of June 30, 2001, there were approximately 30.2 million shares of common stock outstanding. Farros continued, "There has been distraction regarding class action lawsuits. We urge investors to read the complaints against us. These lawsuits focus on alleged arrangements between the underwriters and some of their customers for the company's stock. We believe the lawsuits and claims asserted against iPrint are without merit, and we will continue to defend ourselves vigorously. In addition, we continue to work with Nasdaq to maintain our listing status. In early July we remedied our compliance for value of minimum public float, and once we've released the SEC documentation regarding the Wood merger, we will finally have the opportunity to discuss in detail with investors the strong benefits of this combination.'' Other Second Quarter Highlights * Focus on higher quality revenues. Gross margin increased to 41% from 33% in Q1 2001 and 28% in Q2 2000. * Significant new technology partnerships with PeopleSoft, Microsoft, and Ariba. * Significant internal cost cutting, including headcount reduction from 118 at the end of Q1 2001 to 80 at the end of Q2 2001. * Introduction of e-Fulfillment technology, allowing corporations to offer customers easy access to ordering multi-component kits and marketing material via a customized, personalized electronic interface. iPrint's value-added services include technology, internal billing, credit card processing, backend fulfillment, shipping, and order tracking functions. * Corporate name change to iPrint Technologies, inc., intended to better reflect the nature of our expanding business. Financial Guidance The company believes near-term revenues and loss per share will be affected by merger related activities. As a result, the company believes it will see flat revenue and flat to slightly higher loss per share for Q3 2001 as compared with Q2 2001. The company is keeping its annual guidance of $22.5 million to $28 million in revenues and pro-forma net loss per share of $0.45 to $0.50, but may revise this guidance as appropriate in accordance with merger related progress and economic conditions in the second half of 2001. The company believes it has appropriate cash reserves to reach profitability.