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Corel Announces 1Q Results, Reports Quarterly Loss of $3.1 Million

Press release from the issuing company

OTTAWA--March 28, 2002--Corel announced results for its first quarter of fiscal 2002, ended February 28, 2002. All figures are reported in US currency. Revenues for the first quarter of 2002 totaled $31.2 million, meeting consensus estimates. The company reported a net loss of $3.1 million or $(0.04) per share, exceeding consensus estimates of $(0.05). This compares to revenues of $32.5 million, with a net profit of $534,000, for the same period in fiscal 2001. In addition, total revenues for the first quarter 2002 are consistent with revenues for the fourth quarter of 2001, when the company reported $31.6 million in total revenues. Cash, cash equivalents, short-term investments and restricted cash amounts at the end of the first quarter stood at $114.7 million. The company expects fiscal Q2 results to be similar to this quarter and will update its outlook for the remainder of the year at alater date. "The quarter finished in line with the guidance we provided earlier this year, generating positive EBITDA of $1.3 million,'' said John Blaine, chief financial officer of Corel Corporation. "We have successfully managed our costs to match revenues enabling the company to support its current customer base while gaining traction in the enterprise market.'' "Today's results are consistent with our strategy to support the company's current business lines while investing for growth in the creative professional and enterprise markets,'' said Derek Burney, president and chief executive officer of Corel Corporation. "We continue to build momentum, announcing new bundling agreements with Hewlett-Packard and Sony Electronics, completing the SoftQuad acquisition, and introducing a new brand - DEEPWHITE - specifically designed to cater to enterprise customers.'' Recent Highlights The Ontario Ministry of Education has signed a contract with Corel Corporation to provide every public school in Ontario with licenses for CorelDRAW 10 and WordPerfect Office 2002. Corel Corporation recently announced two new bundling deals for WordPerfect with Hewlett-Packard and Sony Electronics Inc. The company announced the worldwide availability of Corel DESIGNER(TM) 9, a technical illustration package, at CeBIT in Hannover, Germany. Added to the Corel product line since the acquisition of Micrografx in October 2001, Corel DESIGNER 9 has been updated to facilitate the smooth integration of Designer into a technical graphics workflow alongside the company's best- selling creative package, CorelDRAW. The procreate(TM) family of products was featured on all workstations at Nikon's Press Centers at the 2002 Winter Olympic Games in Salt Lake City. The company's enterprise strategy was unveiled during Derek Burney's keynote presentation delivered at Seybold Seminars NY. As part of its strategy to address the enterprise market, the company introduced DEEPWHITE(TM), a new brand which will capitalize on the strengths of XML and other open standards to deliver solutions for content creation, enterprise process management and technical graphics. Corel Corporation completed its acquisition of SoftQuad Software, Ltd., a leading developer of XML-enabling technologies. The acquisition of SoftQuad will play a key role in the company's DEEPWHITE strategy. In addition to leveraging SoftQuad's exceptional XML technologies and development assets, the company will build upon its enterprise-level expertise through the addition of SoftQuad's highly-skilled marketing, sales and professional services teams.