CIMdata PLM Industry Summary Online Archive
10 November 2004
Financial News
RAND Worldwide Announces Third Quarter 2004 Results
Rand A Technology Corporation, operating as RAND Worldwide ®, announced its financial results for the third quarter ended September 30, 2004.
The following financial figures have been adjusted to reflect discontinued operations based on the pending agreement with Dassault Systèmes (see Press Release dated October 26, 2004). The transaction is expected to close before year-end and the proceeds of approximately $50 million will eliminate $38 million of outstanding debt and move RAND Worldwide to a debt-free position for 2005. Additionally, the Company has decided to exit unprofitable operations in Italy and its Shared Services Centre in Ireland.
Revenue for the third quarter ended September 30, 2004 was $23.3 million, compared with $24.5 million the previous quarter and $27.5 million during the quarter ended September 30, 2003. RAND Worldwide's gross profit margin during the third quarter in 2004 was 49.6%, compared with 56.0% for the second quarter ended June 30, 2004 and 44.2% for the third quarter of 2003.
The Company recorded a loss in operating earnings during the third quarter ended September 30, 2004, before interest, taxes, depreciation and amortization, restructuring and asset write-downs, equity losses, net of dilution gains and losses and the results of discontinued operations (EBITDA loss 1 ), of ($2.1 million), compared with a loss of ($2.0 million) the previous quarter and a loss of ($7.9 million) during the third quarter ended September 30, 2003. Net loss for the nine month period ended September 30, 2004 was ($15.6 million), compared to a net loss of ($42.7 million) for the nine month period ended September 30, 2003.
The Company had cash and short-term investments totaling $6.4 million as at September 30, 2004, compared with $6.9 million on June 30, 2004.
The Company's net loss for the third quarter of 2004 was ($12.9 million), compared with net income of $4.6 million the previous quarter and a net loss of ($10.2 million) for the third quarter of 2003. The net loss for the third quarter of 2004 includes an accounting loss on the disposition of the discontinued operations discussed above of ($4.9 million), a net loss and related interest on discontinued operations held for sale of ($2.9 million), and a net loss and closing costs related to discontinued operations not held for sale of ($1.6 million).
The net loss per Common Share for the three months ended September 30, 2004 was ($0.77), compared with net earnings of $0.28 per Common Share for the second quarter ended June 30, 2004 and a net loss of ($0.61) per Common Share for the third quarter of 2003. The net loss per Common Share for the nine month period ended September 30, 2004 was ($0.93), compared to a net loss per Common Share of ($2.58) for the nine month period ended September 30, 2003.
Frank Baldesarra, President and Chief Executive Officer of RAND Worldwide stated, "After taking into account the major transaction with Dassault Systèmes last month, we have taken further steps to become a profitable business capable of delivering PLM solutions globally."
Kriss Bush, Chief Financial Officer of RAND Worldwide stated, "Once the Dassault transaction closes, RAND Worldwide will have a debt-free balance sheet and will be in a positive cash position, which gives the Company a solid foundation for the future."
Full financial results can be found at http://www.rand.com/uk/investors_uk.htm
The contents of this News Release has been reviewed and approved by the Audit Committee and the Board of Directors. All currencies are stated in Canadian dollars.
1 EBITDA is not a recognized measure under Canadian generally accepted accounting principles (GAAP). Management believes that, in addition to net income (loss), EBITDA is a useful supplemental measure as it is used by certain investors as one measure of the Company's financial performance. Investors should be cautioned, however, that EBITDA should not be construed as an alternative to net income (loss) determined in accordance with GAAP as an indicator of the Company's performance or to cash flows from operating, investing and financing activities as a measure of liquidity and cash flows. The Company's method of calculating EBITDA may differ from other companies and, accordingly, EBITDA may not be comparable to measures used by other companies.
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