NASHUA, N.H., June 16 /PRNewswire-FirstCall/ -- SkillSoft PLC (Nasdaq: SKIL), a leading global provider of comprehensive, multi-modal e-Learning content and software products for business and information technology (IT) professionals, today announced financial results for its quarter ended April 30, 2003, the first quarter of fiscal 2004.
SkillSoft reported total revenue of $43.6 million for the quarter ended April 30, 2003, which represented a modest increase compared to $42.9 million for the fiscal 2003 fourth quarter. The company reported total revenue of $13.8 million in the quarter ended April 30, 2002. Gross margin was 87% for its fiscal 2004 first quarter compared to 88% for the fiscal 2003 fourth quarter. The decrease, compared to the fiscal 2003 first quarter gross margin of 94%, is due primarily to the fact that the prior year figure represents the pre-merger SkillSoft Corporation gross margin without the impact of royalty-bearing product lines added as a result of the SmartForce merger.
SkillSoft's net loss was $12.6 million, or $0.13 per diluted share for the quarter ended April 30, 2003. This net loss includes a restructuring charge of $1.2 million or $0.01 per diluted share, costs in connection with the pending restatement of the historical SmartForce financial statements of $5.4 million or $0.05 per diluted share, and a charge of $2.2 million or $0.02 per diluted share for the settlement of its IP Learn litigation. For the comparable year ago period, the company had a net profit of $282,000, or $0.02 per basic and diluted share.
"Our better-than-anticipated first quarter results clearly demonstrate the success of our strategy - to attract and retain customers by providing the most comprehensive e-Learning offering in the market," commented Chuck Moran, President and Chief Executive Officer. "A cornerstone of our success has always been customer satisfaction, which we believe leads to higher renewal rates. We continue to make progress toward our goal of improving our renewal rates in fiscal 2004 over our fiscal 2003 reported level of 55%. Furthermore, our sales force - enabled with an offering no other company can match - is energized as their hard work and commitment is beginning to show in new customer wins."
SkillSoft achieved its net days sales outstanding (DSO) targeted range in the quarter, maintaining a strong cash position of $122 million as of April 30, 2003 compared to $125 million as of January 31, 2003. On a net basis, which considers only receivable balances for which revenue has been recorded, DSOs decreased to 14 days in the fiscal 2004 first quarter as compared to 39 days in the year ago quarter and 33 days in the fourth quarter of fiscal 2003. On a gross basis, which considers all items billed as receivables, DSOs were 99 days in the first quarter of fiscal 2004 compared to 99 days in the year ago comparable quarter and 141 days in the fourth quarter of fiscal 2003. The company is below its net DSO historical target range (45 to 60 days) and expects that DSOs are likely to return to that range in the future based on historical collection patterns.
In order to adequately assess the company's collection efforts, taking into account the seasonality of the company's business, DSO analysis must compare current period results to the results of the prior year comparable period. Given the quarterly seasonality of bookings, the deferral from revenue of subscription billings may increase or decrease the DSO on subsequent quarterly comparisons.
For the fiscal year ending January 31, 2004, SkillSoft is currently anticipating revenue to be at the higher end of its previously disclosed range of between $185.0 and $190.0 million. Quarterly revenue distribution for the remainder of fiscal 2004, Q2 to Q4, is targeted at 24%, 25%, 28% of the annual range, respectively.
The company continues to anticipate that its net loss for fiscal 2004 will be between to $0.22 and $0.23 per basic and diluted share. The net loss includes the settlement of the IP Learn litigation, which is reflected in General and Administrative expenses. The company's outlook excludes the potential negative impact of the resolution of any other litigation matters, as well as the potential impact of any future acquisitions, including potential non-recurring acquisition related-related expenses and the amortization of any purchased intangibles and deferred compensation charges resulting from an acquisition transaction.
SkillSoft will be hosting a conference call to discuss its first quarter earnings on Tuesday, June 17 at 10:00 AM EDT. To participate in the conference call, local and international callers can dial 952-556-2870. The live conference call will be available via the Internet by accessing the SkillSoft Web site at www.skillsoft.com. Please go to the Web site at least fifteen minutes prior to the call to register, download and install any necessary audio software.
A replay will be available approximately one hour after the call, until 11:59 p.m. EDT on June 24, 2003. The replay number is 703-925-2474, passcode: 176465. A web cast replay will also be available on the Company's web site at www.skillsoft.com.
SkillSoft is a leading provider of e-learning courseware and referenceware for business and IT professionals. SkillSoft products and services are designed to accelerate the ability of today’s workforce to master the business and technology skills required for competitive success. The company has more thousands of corporate customers worldwide and more than 4.5 million licensed users.
SkillSoft focuses on meeting the comprehensive business skills and information technology learning needs of professionals in Global 5000 organizations through a comprehensive range of content-focused, e-learning solutions, including:
Business Skills Library: More than 1,900 courseware and simulation titles encompassing professional effectiveness, management/leadership, project management, sales & customer-facing skills, business strategy/operations, finance, human resources, safety/health and financial services industry. Courses feature strong visual design; a focus on instructional objectives at the application and analysis levels; learner interactivity and reinforcement through RolePlays, SkillSimulations, and case studies; and pre- and post-course assessments with prescriptive learning capabilities.
IT Skills and Certification Library: More than 1,800 course titles encompassing software development, operating systems and server technologies, Internet and network technologies, enterprise database systems, web design, and desktop computer skills. The IT library also supports more than 70 current certification exams.
ITPro and Business Pro Referenceware: More than 3,600 unabridged IT and business books and reports are available to online subscribers through SkillSoft’s subsidiary, Books24x7. A unique, patent-pending search engine gives subscribers the ability to perform multi-level searches.
SkillSoft customers include organizations such as: Siemens
Business Services, Novell, American Red Cross, Fluor
Corporation, Verizon, U.S. Army, Deloitte Consulting,
Raytheon, IBM, Internal Revenue Service, Army National
Guard, Qwest, Department of Transportation, and NEC America.
SkillSoft, SkillPort, RolePlay, Search-and-Learn, e-Learning for the Knowledge Economy, NetUniversity, and Accelerated Path are trademarks and/or servicemarks of SkillSoft PLC. Books24x7 and Referenceware are servicemarks of Books24x7, Inc. All brand names, trademarks, or registered trademarks are the property of their respective holders.
This release includes information that constitutes forward-looking statements made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. Any such forward-looking statements involve risk and uncertainties that could cause actual results to differ materially from any future results encompassed within the forward-looking statements. Factors that could cause or contribute to such differences include difficulties in integrating the organizations of SmartForce and SkillSoft, competitive pressures, changes in customer demands or industry standards, adverse economic conditions, loss of key personnel, litigation and other matters disclosed under the heading "Risk Factors" in SkillSoft's Quarterly Report on Form 10-Q for the quarter ended October 31, 2002, as filed with the Securities and Exchange Commission. The forward-looking financial information provided by the Company in this press release represents the Company's estimates as of April xx, 2003. We anticipate that subsequent events and developments will cause the Company's estimates to change. However, while the Company may elect to update this forward-looking financial information at some point in the future, the Company specifically disclaims any obligation to do so. This forward-looking information should not be relied upon as representing the Company's estimates of its future financial performance as of any date subsequent to the date of this release.
Chief Financial Officer of SkillSoft PLC
603-324-3000, ext. 4232
Michael Polyviou or Kirin Smith