Borland Announces Fourth Quarter and Fiscal Year 2000 Earnings Results

Outlines 2001 Strategy to Grow Revenue, Increase Profitability and Extend

Global Leadership in High-Performance Platforms for e-Business Application


Jan 25, 2001, 00:00 ET from Borland Software Corporation

    SCOTTS VALLEY, Calif., Jan. 25 /PRNewswire/ --
 Borland Software Corporation (Nasdaq:   BORL), formerly known as
 Inprise Corporation, today announced operating results for the Company's
 fourth quarter and its fiscal year ended December 31, 2000 and outlined its
 business strategy for 2001.
     For the fourth quarter, revenues were $50.3 million, up from
 $45.5 million in the same period one year ago, and excluding one time gains
 and losses, net income was $7.3 million or $0.11 per fully diluted share,
 compared to a net loss of ($3.0) million or ($0.05) per diluted share in the
 fourth quarter of 1999.
     For the fiscal year ended December 31, 2000, Borland reported revenues of
 $191.1 million, a 9% increase from revenues of $174.8 million in 1999.
 Excluding non-recurring gains and losses, Borland recorded net income of
 $20.2 million, or fully diluted earnings per share of $0.29, compared to a net
 loss of ($30.7) million, or diluted loss per share of ($0.56), for the same
 period last year.  Net income for fiscal 1999 included a $100 million one-time
 licensing fee received from Microsoft Corporation and one-time charges of
 $50.0 million for restructuring, severance and compensation expenses related
 to Borland's InterBase(R) product line, and the write-down of Borland's
 Scotts Valley facility which was sold in March 2000 for $47 million.
     "Our outstanding performance in the fourth quarter caps off a momentous
 year of transition at Borland," said Dale L. Fuller, president and
 chief executive officer of Borland.  "I think it is particularly fitting that
 we are announcing our third consecutive quarter of operating profitability at
 the same time we reclaim our well-recognized Borland name, symbolizing our
 return to Borland's historic commitment to superior technology and industry
 leadership.  Our renewed focus on product development, business execution and
 operational efficiency has created a solid foundation for even greater success
 in the year ahead as we help companies develop, deploy and manage applications
 for a new digital world."
     2000 Highlights
     In 2000, Borland undertook a number of critical steps to enhance operating
 efficiency and strengthen its business, the most important of which was the
 reorganization of the Company's core product groups into four distinct
 business units:  Rapid Application Development (RAD), Java, Enterprise
 Deployment and Borland(R) Developer Services.  In addition, Borland's sales
 and marketing groups were reorganized into three regional sales and marketing
 units to better support the Company's customers and partners in the Americas,
 Asia-Pacific and Europe/Middle-East/Africa (EMEA).  Dale Fuller agreed to
 serve as Borland's president and chief executive officer on a permanent basis,
 and the Company also put in place a seasoned senior management team with a
 proven ability to execute.  Several new product initiatives were undertaken to
 ensure that Borland will continue to be a technology innovator in the months
 and years ahead.
     Borland returned to operating profitability during the second quarter, and
 increased its revenues in each quarter of 2000.  The Company also bolstered
 its balance sheet, increasing cash, cash equivalents and short-term
 investments to $263 million at year-end.  New versions of the award-winning
 JBuilder(TM) development environment for Java(TM), a first generation wireless
 development product called JBuilder Handheld Express(TM) and Borland(R)
 AppServer(TM) were introduced during the third and fourth quarters.  Also
 during the fourth quarter, Borland acquired an e-services firm, Bedouin, Inc.,
 which will form the core of Borland's newest business unit, Borland Developer
 Services.  Borland Developer Services will leverage Bedouin's expertise in
 building and deploying e-services, such as team coordination, time tracking
 and customer relationship management, to deliver a new platform that will
 allow customers to build, deploy and manage applications via the Internet.
     2001 Outlook
     Borland's objectives for 2001 are:
     -- to achieve 20% revenue growth;
     -- to be the leader in cross-platform development, deployment and
        management; and
     -- to expand its global presence into high growth potential markets
        including China, Korea, India and Latin America.
     "We have an ambitious schedule of new product launches planned for 2001 in
 all of our product groups.  We are also implementing an aggressive global
 growth plan to further expand our overseas sales, which already account for
 more than half of our total revenues.  Additionally, we intend to capitalize
 on our strong OEM relationships and our excellent brand name recognition among
 Fortune 1000 companies to expand the ranks of Borland customers around the
 globe," Mr. Fuller said.
     Borland's line of enterprise development, deployment and management
 products has positioned the Company as a leader in a market that a leading
 research organization projects to grow from $1.7 billion to $5.5 billion by
 2003.  A significant number of the Fortune Global 500 Telecommunications
 Companies and the Fortune Global 500 Financial Securities and Diversified
 Financial Companies already rely on Borland's existing enterprise products,
 including AppServer, AppCenter(TM) and Visibroker(R), for their
 industry-leading security, legacy integration and scalability features.
 Further growth in this rapidly expanding market is expected to be achieved by
 leveraging Borland's existing OEM partnerships with leading e-business
 software brands and its position as the leader in the OEM space with its
 Visibroker J/C++ product.
     Later this quarter, Borland plans to launch Kylix(TM), the first visual
 development environment for the Linux(R) operating system.  Kylix is based
 upon a new technology, the Component Library for Cross-Platform development
 (CLX(TM)), which allows Delphi(TM), C++ and Visual Basic(R) developers to
 build applications for both Linux and Windows(R) servers and desktops using a
 common component architecture.  With the introduction of Kylix, Borland will
 be the first company on the market to offer an industrial-strength RAD tool
 for the rapidly growing Linux market, enabling developers to quickly and
 effectively write large-scale applications for this emerging global standard.
 Borland believes that between one million and two million users of its highly
 successful Delphi and C++Builder(TM) development environments will make the
 move to this new tool for Linux application development.
     Borland will also continue to be the leader in Java development, providing
 a powerful cross-platform environment for application development supporting
 all three of Sun Microsystems' Java platforms (J2EE(TM), J2SE(TM), and
 J2ME(TM)).  Borland's award-winning JBuilder development suite, with a current
 annual growth rate of over 100%, is one of the leading cross-platform
 environments for creating pure Java end-to-end solutions.  New releases of
 JBuilder will support an increasingly broad array of client and server
 computing platforms.
     Borland also intends to focus on products that will support mobile
 application development and deployment.  In addition to providing support for
 applications running on mobile devices, Wireless Application Protocol (WAP)
 server support will extend Borland's development and deployment product
 offerings.  Partnerships with key mobile device manufacturers will also play a
 role in establishing Borland as a leader in this new and rapidly expanding
     As the demand for cross platform applications grows, Borland is also
 developing environments capable of supporting connections from any number of
 different user interfaces or automatic processes.  These "network application
 services" will be built using a variety of standards, including XML/SOAP,
 CORBA(R) and Java.  Borland's technology initiatives will seek to add new
 products in all of the Company's business units to provide customers with
 flexibility and choice as they develop this new generation of applications
 within Microsoft Corporation's .Net(TM) initiative, Sun Microsystem's J2EE
 platform and open industry standards.
     "We are excited about the many opportunities 2001 holds for us, and we are
 delighted to be operating under the Borland name once again as we pursue our
 ambitious growth agenda.  By leveraging our unparalleled expertise in
 cross-platform development, deployment, and management solutions, we will
 enable our customers to move into the future without abandoning the past.  We
 look forward to carrying on Borland's 18-year tradition of providing our
 customers with high performance implementation platforms for professional
 e-business solution providers," Mr. Fuller concluded.
     Borland's fiscal year 2000 fourth quarter teleconference will be held at
 7:30 a.m. (PT) / 10:30 a.m. (ET) today.  To access the live Webcast, please
 visit or Borland's website at
     About Borland
     Borland is a leading provider of high performance e-business
 implementation solutions. Borland is the vendor of choice for professional
 e-business solution providers who demand a vendor-independent implementation
 platform that supports rapid time to market, high productivity, performance
 and availability.  Founded in 1983, Borland is headquartered in
 Scotts Valley, California, with operations worldwide.  To learn more, visit
 Borland at , the community site at or call Borland at 800-632-2864.
     NOTE:  Borland's product and brand names are trademarks or registered
 trademarks of Borland Software Corporation, formerly known as Inprise
 Corporation.  Other names mentioned herein may be trademarks of the party
 using such names. Forward-looking statements in this release, including but
 not limited to, those concerning Borland's future financial performance,
 product development plans, global expansion plans, estimated size of potential
 customer markets, the projected acceptance by existing or potential customers
 of new technologies and the potential features of or benefits to be derived
 from the products developed, marketed or sold by Borland, involve a number of
 uncertainties and risks, and actual events or results may differ materially.
 Factors that could cause actual events or results to differ materially
 include, among others, the following: possible disruptive effects of
 organizational or personnel changes by Borland, shifts in customer demand,
 market acceptance of new or enhanced products developed, marketed or sold by
 Borland, delays in scheduled product availability dates, actions or
 announcements by competitors, software errors, general business conditions and
 market growth rates in the client/server and Internet software markets, and
 other factors described in the reports on Forms 10-K and 10-Q filed by
 Borland Software Corporation with the SEC.
                            BORLAND SOFTWARE CORPORATION
                  (in thousands, except per share data, unaudited)
                                  Three Months Ended         Year Ended
                                Dec. 31,    Dec. 31,     Dec. 31,   Dec. 31,
                                  2000        1999         2000       1999
       Licenses and other       $43,030     $38,485     $163,730    $150,550
       Services                   7,264       6,989       27,337      24,256
     Total revenues              50,294      45,474      191,067     174,806
     Cost of revenues
       Licenses and other         2,573       4,006       12,004      19,267
       Services                   5,156       5,985       19,916      22,676
     Cost of revenues             7,729       9,991       31,920      41,943
     Gross profit                42,565      35,483      159,147     132,863
     Operating expenses
       Research and
        development              10,407      11,468       42,484      42,257
       Selling, general
        and administrative       27,949      29,797      104,793     123,530
     Total continuing expenses   38,356      41,265      147,277     165,787
       Provision for
        restructuring and
        acquisition charges     (1,151)      34,808        (562)      41,767
       Other non-recurring
        charges                      --          --           --       8,193
     Total restructuring,
      acquisition and
      non-recurring charges     (1,151)      34,808        (562)      49,960
     Total operating expenses    37,205      76,073      146,715     215,747
     Operating income (loss)      5,360    (40,590)       12,432    (82,884)
     Interest income, net
      and other (B)               4,158       2,295       13,276     114,234
     Income (loss)
      before taxes                9,518    (38,295)       25,708      31,350
     Provision (benefit)
      for income taxes            1,092       (467)        4,982       8,666
     Net income (loss)           $8,426   $(37,828)      $20,726     $22,684
     Income (loss) per
      share - Basic (A)           $0.13     $(0.64)        $0.32       $0.40
     Income (loss) per
      share - Diluted             $0.12     $(0.64)        $0.30       $0.35
     Shares used in the
      calculation of basic
      income (loss) per share    61,600      59,268       61,357      54,810
     Shares used in the
      calculation of diluted
      income (loss) per share    69,021      59,268       69,874      63,408
     (A) The calculation of net income per share for the three months and year
         ended December 31, 2000 includes an accretion to Preferred Stock of
         approximately $219,000 and $875,000, respectively. The calculation of
         net loss per share for the three months ended December 31, 1999 and
         the net income per share for the year ended December 31, 1999 includes
         an accretion to the Preferred Stock Series C and Mandatorily
         Redeemable Convertible Preferred Stock of approximately $219,000 and
         $506,000, respectively
     (B) The interest income, net and other for the quarter ended
         June 30, 1999 includes $100 million one-time license fee received from
                          BORLAND SOFTWARE CORPORATION
                                 (in thousands)
                                                  December 31,   December 31,
                                                      2000           1999
                                                   (Unaudited)     (Audited)
     Cash, cash equivalents and short-term
      investments                                    $262,559      $ 197,693
     Accounts receivables, net                         33,495         27,303
     Property and equipment, net                       20,438         75,002
     Other assets                                      24,411         13,018
     Total assets                                    $340,903       $313,016
     Current liabilities                              $78,908        $77,897
     Long-term debt and other                          19,316         19,462
     Stockholders' equity                             242,679        215,657
     Total liabilities and stockholders' equity      $340,903       $313,016

SOURCE Borland Software Corporation