Borland Increases Revenue and Earnings in First Quarter

Fourth Consecutive Quarter of Profitability



Apr 25, 2001, 01:00 ET from Borland Software Corporation

    SCOTTS VALLEY, Calif., April 25 /PRNewswire Interactive Release/ --
 Borland Software Corporation (Nasdaq: BORL) today announced its financial
 results for the first quarter ended March 31, 2001.
     For the first quarter, revenues increased 11 percent to $51.7 million from
 $46.5 million for the same quarter a year ago.  Net income for the first
 quarter advanced to $5.9 million, or $0.08 per diluted share, compared with a
 net loss of $(1.1) million, or $(0.02) per share, for the first quarter of
 2000.  Excluding $1.5 million in non-recurring merger-related expenses
 associated with the terminated merger with Corel Corporation during the first
 quarter of last year, the company reported net income of $400,000, or
 $0.01 per diluted share.
     Gross margins improved to 85 percent for the first quarter of 2001 versus
 81 percent for the comparable quarter a year ago.  The improvement is due to a
 shift toward higher-margin enterprise business and improved performance from
 the company's services and support organization.
     "We are very pleased with our first quarter performance," stated
 Dale L. Fuller, Borland's president and chief executive officer.  "Our
 continued focus on operational disciplines and business execution helped us
 achieve steadily increasing revenues and our fourth consecutive quarter of
 profitability.  Our performance this quarter sets the stage for our expansion
 plans in 2001 and beyond.
     "Our growth during the quarter was driven largely by the ongoing success
 of JBuilder(TM), the growing strength of Borland(R) enterprise deployment
 products, and increased services revenues.
     "Revenues from Borland's JBuilder increased 78 percent over the same
 quarter last year and remained the top-rated Java(TM) development environment
 in the world," continued Mr. Fuller.  "JBuilder dominates the market based on
 its superior technology and its status as the only application development
 environment in the market that supports multiple platforms, such as Linux(R),
 Solaris(TM), and Windows(R) and leading deployment environments, including our
 own Borland(R) AppServer(TM) as well as BEA's WebLogic(R) application server.
 Late in the quarter, we enhanced our Java offerings with the launch of our
 Enterprise Studio, a best-of-breed Java solution that is expected to add
 incrementally to revenues throughout the balance of the year."
     Revenues from the company's Enterprise business unit increased about
 40 percent year-over-year. "Even in today's challenging economic climate,
 customers increasingly need high-performance product solutions that enhance
 productivity while lowering costs, and our enterprise solutions meet those
 needs," added Mr. Fuller.
     During the last three weeks of the quarter, Borland began shipping
 Kylix(TM), the first fourth-generation development environment for Linux(TM)
 that enables the more than five million Windows developers to expand their
 options beyond the Windows platform.
     "We are pleased with the initial positive market acceptance of Kylix,
 which contributed incrementally to the first quarter's revenues.  Its positive
 reception supports our belief that it will continue performing well throughout
 the year," added Mr. Fuller.  Also contributing to Borland's RAD business were
 its franchise products Delphi(TM) and C++ Builder(TM).
     "Going into Q2, we expect to reinvigorate our RAD business through the
 next version release of Delphi along with the continuing market penetration by
 Kylix," continued Mr. Fuller.  "The upcoming Delphi release will ship with a
 new Web services capability that will permit rapid development of B2B and B2C
 applications using XML- and SOAP-based technologies.  Web services
 architectures are rapidly gaining acceptance in the marketplace, and we
 believe the next version of Delphi will be well positioned to take advantage
 of this next evolution in computing architectures."
     Fred Ball, the company's chief financial officer, added, "We are
 particularly pleased with our positive cashflow from operations this quarter.
 We generated approximately $9 million during the quarter, excluding a
 one-time, pre-paid license fee of $5.7 million to Sun Microsystems.  This fee
 covers a multi-year agreement related to licenses and support for their Java
 technology.  Additionally, Borland's financial position is the strongest it's
 been in five years.  At quarter end, the company had more than $264 million in
 cash, cash equivalents and short-term investments.  We believe our financial
 position provides us with the strength and flexibility we need to meet our
 customer needs now and over the long haul."
     Concluded Mr. Fuller, "It remains our goal to emerge as the number-one
 player in cross-platform application development, deployment, and management.
 Our strategy today to combine leading development environments such as Delphi,
 JBuilder, and C++ Builder, along with solid execution around legacy
 integration and enterprise deployment, is expected to enhance our ability to
 support our customers' needs around Web services and wireless on a global
 basis.  Borland is strongly positioned to capitalize on the anticipated growth
 in the enterprise software market, which industry analysts estimate will reach
 $5.5 billion by 2003 from $1.7 billion today.  We believe we have the
 technology, product pipeline, operational discipline, and management team to
 execute our plan."
 
     Future Outlook
     The company expects revenues to increase eight to 10 percent in Q2, and
 EPS to fall in the range of $0.08 to $0.10.  For 2001, management anticipates
 that overall revenues will increase approximately 20 percent as compared with
 2000.  Gross margins are expected to remain in the 83-85 percent range, and
 operating margins in the range of seven to nine percent.  Days sales
 outstanding are expected to remain relatively steady in the range of
 60-65 days.  Additionally, depending on Borland's stock price performance
 throughout 2001, weighted average shares outstanding could range from
 71 million to 75 million shares.
 
     Conference Call Information
     The Borland Software Corporation first quarter teleconference call and
 simultaneous Webcast is scheduled to begin at 7:30 a.m., Pacific Daylight
 Time, on Wednesday, April 25, 2001.  To access the live Webcast, please visit
 www.streetevents.com or Borland's Website at www.borland.com at least
 30 minutes prior to the call.
 
     Borland Software Corporation
     Borland is a leading provider of high-performance e-business
 implementation platforms designed to increase developer productivity and
 reduce time to market for enterprise software projects.  E-business
 implementation platforms consist of software products that allow businesses to
 develop, deploy, and manage e-business applications.  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 http://www.borland.com , the community site at
 http://community.borland.com , or call Borland at 800-632-2864.
     NOTE:  All Borland brand and product names are trademarks or registered
 trademarks of Borland Software Corporation, formerly known as Inprise
 Corporation, in the United States and other countries.  Other names mentioned
 herein may be trademarks of the party using such names.
 
     Forward-Looking Statement
     This release contains forward-looking statements.  All statements that are
 not historical are forward-looking.  Forward-looking statements may relate to,
 but are not limited to, Borland's future financial performance, capital
 expenditures, revenues, acquisitions, earnings, costs, product development
 plans, global expansion plans, estimated size of potential customer markets,
 demand for our products, 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, market and
 technological trends in the software industry and various economic and
 business trends. Such forward-looking statements are only predictions and
 involve a number of uncertainties and risks that may cause actual events or
 results to differ materially.  Factors that could cause actual events or
 results to differ materially include, among others, the following:  general
 economic factors and capital market conditions, general industry trends and
 the potential effects on us of competition in computer software product and
 services markets, growth rates in the software and professional services
 markets that we participate in, rapid technological change that can adversely
 affect the demand for our products, shifts in customer demand, market
 acceptance of new or enhanced products or services developed, marketed or sold
 by us, delays in scheduled product availability dates, actions or
 announcements by our competitors, software errors, reduction in sales to or
 loss of any significant customers, our ability to successfully integrate
 acquisitions, any failure by us to protect our intellectual property rights,
 the dependence of certain of our business units on licenses from third
 parties, our ability to attract and retain qualified personnel, and other
 factors described in our latest Annual Report on Form 10-K and our latest
 Quarterly Report on Form 10-Q filed by Borland Software Corporation with the
 SEC, copies of which may be obtained from the SEC at www.sec.gov.  Borland
 undertakes no obligation to update any information contained in this release.
 
                          BORLAND SOFTWARE CORPORATION
                CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                (in thousands, except per share data, unaudited)
 
 
                                                   Three Months Ended
                                                  March 31,    March 31,
                                                    2001         2000
     Revenues
       Licenses and other                           $42,407      $39,774
       Services                                       9,289        6,726
         Total revenues                              51,696       46,500
 
     Cost of revenues
       Licenses and other                             2,981        4,063
       Services                                       5,031        4,936
         Cost of revenues                             8,012        8,999
 
     Gross profit                                    43,684       37,501
 
     Operating expenses
       Research and development                      11,278       11,053
       Selling, general and administrative           28,538       27,221
       Merger-related expenses                           --        1,542
       Total operating expenses                      39,816       39,816
 
     Operating income (loss)                          3,868      (2,315)
     Interest income, net and other                   3,448        2,215
     Income (loss) before taxes                       7,316        (100)
     Provision for income taxes                       1,463        1,046
 
     Net income (loss)                               $5,853     $(1,146)
 
     Income (loss) per share - Basic (A)              $0.09      $(0.02)
 
     Income (loss) per share - Diluted                $0.08      $(0.02)
 
     Shares used in the calculation of
     basic income (loss) per share                   61,863       61,080
 
     Shares used in the calculation of
     diluted income (loss) per share                 71,890       61,080
 
 
     (A) The calculation of basic net income (loss) per share for the three
         months ended March 31, 2001 and 2000 includes an accretion to
         Borland's Series C Preferred Stock of approximately $219,000.
 
 
                          BORLAND SOFTWARE CORPORATION
                      CONDENSED CONSOLIDATED BALANCE SHEET
                                 (in thousands)
 
 
                                             March 31, 2001  December 31, 2000
                                              (Unaudited)         (Audited)
 
 
               ASSETS
     Cash, cash equivalents and
       short-term investments                   $264,108          $262,559
     Accounts receivables, net                    33,186            33,495
     Property and equipment, net                  20,777            20,438
     Other assets                                 23,876            24,411
 
         Total assets                           $341,947          $340,903
 
 
     LIABILITIES AND STOCKHOLDERS' EQUITY
     Current liabilities                         $55,456          $ 60,143
     Deferred revenue                             18,773            18,765
     Long-term debt and other                     18,463            19,315
 
     Stockholders' equity                        249,255           242,680
 
         Total liabilities and
           stockholders' equity                 $341,947          $340,903
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X81624525
 
 

SOURCE Borland Software Corporation
    SCOTTS VALLEY, Calif., April 25 /PRNewswire Interactive Release/ --
 Borland Software Corporation (Nasdaq: BORL) today announced its financial
 results for the first quarter ended March 31, 2001.
     For the first quarter, revenues increased 11 percent to $51.7 million from
 $46.5 million for the same quarter a year ago.  Net income for the first
 quarter advanced to $5.9 million, or $0.08 per diluted share, compared with a
 net loss of $(1.1) million, or $(0.02) per share, for the first quarter of
 2000.  Excluding $1.5 million in non-recurring merger-related expenses
 associated with the terminated merger with Corel Corporation during the first
 quarter of last year, the company reported net income of $400,000, or
 $0.01 per diluted share.
     Gross margins improved to 85 percent for the first quarter of 2001 versus
 81 percent for the comparable quarter a year ago.  The improvement is due to a
 shift toward higher-margin enterprise business and improved performance from
 the company's services and support organization.
     "We are very pleased with our first quarter performance," stated
 Dale L. Fuller, Borland's president and chief executive officer.  "Our
 continued focus on operational disciplines and business execution helped us
 achieve steadily increasing revenues and our fourth consecutive quarter of
 profitability.  Our performance this quarter sets the stage for our expansion
 plans in 2001 and beyond.
     "Our growth during the quarter was driven largely by the ongoing success
 of JBuilder(TM), the growing strength of Borland(R) enterprise deployment
 products, and increased services revenues.
     "Revenues from Borland's JBuilder increased 78 percent over the same
 quarter last year and remained the top-rated Java(TM) development environment
 in the world," continued Mr. Fuller.  "JBuilder dominates the market based on
 its superior technology and its status as the only application development
 environment in the market that supports multiple platforms, such as Linux(R),
 Solaris(TM), and Windows(R) and leading deployment environments, including our
 own Borland(R) AppServer(TM) as well as BEA's WebLogic(R) application server.
 Late in the quarter, we enhanced our Java offerings with the launch of our
 Enterprise Studio, a best-of-breed Java solution that is expected to add
 incrementally to revenues throughout the balance of the year."
     Revenues from the company's Enterprise business unit increased about
 40 percent year-over-year. "Even in today's challenging economic climate,
 customers increasingly need high-performance product solutions that enhance
 productivity while lowering costs, and our enterprise solutions meet those
 needs," added Mr. Fuller.
     During the last three weeks of the quarter, Borland began shipping
 Kylix(TM), the first fourth-generation development environment for Linux(TM)
 that enables the more than five million Windows developers to expand their
 options beyond the Windows platform.
     "We are pleased with the initial positive market acceptance of Kylix,
 which contributed incrementally to the first quarter's revenues.  Its positive
 reception supports our belief that it will continue performing well throughout
 the year," added Mr. Fuller.  Also contributing to Borland's RAD business were
 its franchise products Delphi(TM) and C++ Builder(TM).
     "Going into Q2, we expect to reinvigorate our RAD business through the
 next version release of Delphi along with the continuing market penetration by
 Kylix," continued Mr. Fuller.  "The upcoming Delphi release will ship with a
 new Web services capability that will permit rapid development of B2B and B2C
 applications using XML- and SOAP-based technologies.  Web services
 architectures are rapidly gaining acceptance in the marketplace, and we
 believe the next version of Delphi will be well positioned to take advantage
 of this next evolution in computing architectures."
     Fred Ball, the company's chief financial officer, added, "We are
 particularly pleased with our positive cashflow from operations this quarter.
 We generated approximately $9 million during the quarter, excluding a
 one-time, pre-paid license fee of $5.7 million to Sun Microsystems.  This fee
 covers a multi-year agreement related to licenses and support for their Java
 technology.  Additionally, Borland's financial position is the strongest it's
 been in five years.  At quarter end, the company had more than $264 million in
 cash, cash equivalents and short-term investments.  We believe our financial
 position provides us with the strength and flexibility we need to meet our
 customer needs now and over the long haul."
     Concluded Mr. Fuller, "It remains our goal to emerge as the number-one
 player in cross-platform application development, deployment, and management.
 Our strategy today to combine leading development environments such as Delphi,
 JBuilder, and C++ Builder, along with solid execution around legacy
 integration and enterprise deployment, is expected to enhance our ability to
 support our customers' needs around Web services and wireless on a global
 basis.  Borland is strongly positioned to capitalize on the anticipated growth
 in the enterprise software market, which industry analysts estimate will reach
 $5.5 billion by 2003 from $1.7 billion today.  We believe we have the
 technology, product pipeline, operational discipline, and management team to
 execute our plan."
 
     Future Outlook
     The company expects revenues to increase eight to 10 percent in Q2, and
 EPS to fall in the range of $0.08 to $0.10.  For 2001, management anticipates
 that overall revenues will increase approximately 20 percent as compared with
 2000.  Gross margins are expected to remain in the 83-85 percent range, and
 operating margins in the range of seven to nine percent.  Days sales
 outstanding are expected to remain relatively steady in the range of
 60-65 days.  Additionally, depending on Borland's stock price performance
 throughout 2001, weighted average shares outstanding could range from
 71 million to 75 million shares.
 
     Conference Call Information
     The Borland Software Corporation first quarter teleconference call and
 simultaneous Webcast is scheduled to begin at 7:30 a.m., Pacific Daylight
 Time, on Wednesday, April 25, 2001.  To access the live Webcast, please visit
 www.streetevents.com or Borland's Website at www.borland.com at least
 30 minutes prior to the call.
 
     Borland Software Corporation
     Borland is a leading provider of high-performance e-business
 implementation platforms designed to increase developer productivity and
 reduce time to market for enterprise software projects.  E-business
 implementation platforms consist of software products that allow businesses to
 develop, deploy, and manage e-business applications.  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 http://www.borland.com , the community site at
 http://community.borland.com , or call Borland at 800-632-2864.
     NOTE:  All Borland brand and product names are trademarks or registered
 trademarks of Borland Software Corporation, formerly known as Inprise
 Corporation, in the United States and other countries.  Other names mentioned
 herein may be trademarks of the party using such names.
 
     Forward-Looking Statement
     This release contains forward-looking statements.  All statements that are
 not historical are forward-looking.  Forward-looking statements may relate to,
 but are not limited to, Borland's future financial performance, capital
 expenditures, revenues, acquisitions, earnings, costs, product development
 plans, global expansion plans, estimated size of potential customer markets,
 demand for our products, 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, market and
 technological trends in the software industry and various economic and
 business trends. Such forward-looking statements are only predictions and
 involve a number of uncertainties and risks that may cause actual events or
 results to differ materially.  Factors that could cause actual events or
 results to differ materially include, among others, the following:  general
 economic factors and capital market conditions, general industry trends and
 the potential effects on us of competition in computer software product and
 services markets, growth rates in the software and professional services
 markets that we participate in, rapid technological change that can adversely
 affect the demand for our products, shifts in customer demand, market
 acceptance of new or enhanced products or services developed, marketed or sold
 by us, delays in scheduled product availability dates, actions or
 announcements by our competitors, software errors, reduction in sales to or
 loss of any significant customers, our ability to successfully integrate
 acquisitions, any failure by us to protect our intellectual property rights,
 the dependence of certain of our business units on licenses from third
 parties, our ability to attract and retain qualified personnel, and other
 factors described in our latest Annual Report on Form 10-K and our latest
 Quarterly Report on Form 10-Q filed by Borland Software Corporation with the
 SEC, copies of which may be obtained from the SEC at www.sec.gov.  Borland
 undertakes no obligation to update any information contained in this release.
 
                          BORLAND SOFTWARE CORPORATION
                CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                (in thousands, except per share data, unaudited)
 
 
                                                   Three Months Ended
                                                  March 31,    March 31,
                                                    2001         2000
     Revenues
       Licenses and other                           $42,407      $39,774
       Services                                       9,289        6,726
         Total revenues                              51,696       46,500
 
     Cost of revenues
       Licenses and other                             2,981        4,063
       Services                                       5,031        4,936
         Cost of revenues                             8,012        8,999
 
     Gross profit                                    43,684       37,501
 
     Operating expenses
       Research and development                      11,278       11,053
       Selling, general and administrative           28,538       27,221
       Merger-related expenses                           --        1,542
       Total operating expenses                      39,816       39,816
 
     Operating income (loss)                          3,868      (2,315)
     Interest income, net and other                   3,448        2,215
     Income (loss) before taxes                       7,316        (100)
     Provision for income taxes                       1,463        1,046
 
     Net income (loss)                               $5,853     $(1,146)
 
     Income (loss) per share - Basic (A)              $0.09      $(0.02)
 
     Income (loss) per share - Diluted                $0.08      $(0.02)
 
     Shares used in the calculation of
     basic income (loss) per share                   61,863       61,080
 
     Shares used in the calculation of
     diluted income (loss) per share                 71,890       61,080
 
 
     (A) The calculation of basic net income (loss) per share for the three
         months ended March 31, 2001 and 2000 includes an accretion to
         Borland's Series C Preferred Stock of approximately $219,000.
 
 
                          BORLAND SOFTWARE CORPORATION
                      CONDENSED CONSOLIDATED BALANCE SHEET
                                 (in thousands)
 
 
                                             March 31, 2001  December 31, 2000
                                              (Unaudited)         (Audited)
 
 
               ASSETS
     Cash, cash equivalents and
       short-term investments                   $264,108          $262,559
     Accounts receivables, net                    33,186            33,495
     Property and equipment, net                  20,777            20,438
     Other assets                                 23,876            24,411
 
         Total assets                           $341,947          $340,903
 
 
     LIABILITIES AND STOCKHOLDERS' EQUITY
     Current liabilities                         $55,456          $ 60,143
     Deferred revenue                             18,773            18,765
     Long-term debt and other                     18,463            19,315
 
     Stockholders' equity                        249,255           242,680
 
         Total liabilities and
           stockholders' equity                 $341,947          $340,903
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X81624525
 
 SOURCE  Borland Software Corporation