Open Market Announces Financial Results For The First Quarter Ended March 31, 2001

Apr 26, 2001, 01:00 ET from Open Market, Inc.

    BURLINGTON, Mass., April 26 /PRNewswire/ --Open Market, Inc.,
 (Nasdaq: OMKT), a provider of content-driven e-business solutions, today
 announced financial results for its first quarter ended March 31, 2001.
 Net revenues for the three months ended March 31, 2001, were $13.0 million,
 compared to net revenues of $24.8 million for the first quarter of 2000.
 Net loss for the first quarter ended March 31, 2001, including a $4.5 million
 non-operating gain related to the sale of certain technology assets to
 NextPage Inc. as previously announced, was $8.7 million, compared to a net
 loss of $4.8 million for the first quarter ended March 31, 2000.
     Revenues by line of business for the three months ended March 31, 2001 and
 2000(in millions), were as follows:
 
     Business Segment                    Q1 01          Q1 00     (Decline)
                                                                    Growth
     Content-driven
      e-Business Solutions              $7.7            $9.7         (21%)
     Transact/ShopSite                  $3.6           $13.8         (74%)
     NextPage/Other                     $1.7            $1.3          31 %
     Total                             $13.0           $24.8        (48 %)
 
     "A substantial portion of our revenue decline in Q1 2001, as compared to
 Q1 2000, relates to expected declines in our heritage commerce business. In
 addition, the slowing economy and uncertain business climate, which is
 adversely affecting many technology companies worldwide, also impacted our
 content management and delivery business, particularly in North America",
 stated Harland LaVigne, president and CEO of Open Market.
     "Despite these Q1 results, and the uncertain impact on IT spending
 resulting from a continuation of the soft external economic environment, we
 believe our revised strategy and commitment to the content management and
 delivery market, best positions us for long term success," LaVigne continued.
 "We remain focused on achieving our previously announced goal of attaining
 profitability in the fourth quarter of 2001.  The reduction in our cost
 structure in early April 2001, as previously announced, should assist us
 towards this end, and we will continue to monitor our cost structure as
 appropriate."
 
     New Business
     During Q1 2001, Open Market's content management and delivery solutions
 were selected by some of the world's leading enterprises in the media,
 financial services, and manufacturing industries.  These included companies
 such as Flextech Television Ltd., the U.K.'s largest supplier of themed
 channel programming; Netway Communications AG, providers of hosting and
 communications services; Alstom Holdings serving the energy infrastructure and
 transportation markets in over 70 countries; ChemWeb.com a portal site for
 over 250,000 of the world's chemical researchers; and Cofiniti, a leading
 developer of financial management software for the retail financial services
 industry.
 
     Products
     During Q1, Open Market announced its new product family, Content
 Server(TM) Enterprise Edition (CSEE), adding new e-marketing and business-to-
 business integration (B2Bi) capabilities to its award-winning content
 management and delivery system.  CSEE is designed, developed, and deployed as
 Java components built on leading Java(TM) 2 Enterprise Edition (J2EE(TM))
 application servers including the IBM WebSphere(R) Application Server, the BEA
 WebLogic Server(TM), and the iPlanet Application Server(TM). CSEE is the
 industry's first content management and delivery solution built directly on
 top of all three of these leading e-business platforms, reinforcing Open
 Market's long-standing Java and open standards development strategy.
     During the first quarter, Open Market's Content Server product family was
 once again recognized by one of the industry's leading analyst organizations.
 In January and February 2001, Forrester Research, Inc. (Nasdaq: FORR) ranked
 Open Market's Content Server(TM) product family first in its eBusiness
 TechRankings(TM) research and testing of content management vendors. The
 February award was the third consecutive month that Open Market had received
 the No. 1 ranking. In maintaining the top position in December, January and
 February, Open Market scored higher than the offerings of 12 other market-
 leading content management vendors.
 
     Partnerships
     During Q1 2001, the Company continued to devote efforts towards advancing
 its relationships with the leading application server vendors whose products
 they support.
     During the quarter, Open Market further strengthened its strategic
 alliance with IBM by announcing our support for AIX an open, scalable UNIX(R)
 operating system designed to support critical Internet and e-commerce
 applications.  An integrated CSEE and IBM WebSphere Application Server
 solution was shipped to a major U.S. insurance firm for the deployment of a
 scalable intranet project designed to enable the firm to reduce their total
 cost of ownership by standardizing on a joint IBM/Open Market solution.  A
 similar solution was also installed at a leading U.S. chemical manufacturer
 for the development of a comprehensive customer information site.   In
 addition, the company participated in several IBM industry events including
 Fasttrack, WebSphere 2001, PartnerWorld, and Link 2001.
     In Q1 2001, Open Market also continued its co-selling model with BEA
 Systems closing 11 new business deals to enterprises worldwide. Open Market
 was named a top-tier BEA Three Star Partner as a result of influencing at
 least $1 million in sales of BEA products during 2000.  In addition, Open
 Market has extended its relationship with the company by initiating a new
 partnership with the BEA
 E-Commerce Application Division.
     Finally, advancing its longtime strategic alliance with iPlanet(TM), Open
 Market participated in co-marketing events such as the multi-city roadshow
 Scale the World and the IEB industry event.
 
     About Open Market
     Open Market, Inc. makes content-driven e-business solutions that enable
 enterprises to better manage interactions with their site visitors, customers,
 employees, and channels. Leveraging the new Java(TM) 2 Platform Enterprise
 Edition (J2EE(TM)) standard, the Company's software products are built with
 Java, JSP and XML and are layered on top of popular application servers like
 the BEA WebLogic Server, the IBM WebSphere Application Server and the iPlanet
 Application Server. Open Market's roster of global customers includes
 publishers and media companies like The McGraw-Hill Companies, The Washington
 Post and The New York Times Company; financial services companies like Chase
 Manhattan Bank, GE Capital and The Hartford Financial Services Group; and
 manufacturers like 3Com, BASF and Milacron. The company, headquartered in
 Burlington, Massachusetts, has customers in 39 countries. Open Market's
 international head office is in the U.K. with additional offices in Australia,
 Canada, France, Germany, Italy, Japan, The Netherlands and Singapore. Open
 Market can be reached by calling 1-888-OPEN-MKT (toll-free) or 1-781-359-3000
 in the U.S. or 1753-838-000 in the U.K. or by visiting
 http://www.openmarket.com.
 
     NOTE:  The statements contained in this release regarding our new
 products, new and continuing strategic alliances, revised business strategy,
 the industry's recognition of our new product family, our goal to obtain
 profitability in the fourth quarter of 2001 and all other statements that are
 not purely historical, are forward-looking statements within the meaning of
 the Private Securities Litigation Reform Act of 1995.  All such forward-
 looking statements are based upon information available to us as of the date
 hereof, and we disclaim any intention or obligation to update any such
 forward-looking statements.  Actual results could differ materially from the
 current expectations.  Important factors that could cause actual results to
 differ materially from those indicated by such forward-looking statements are
 set forth under the heading "Certain Factors That May Affect Future Results"
 in the Company's Annual Report on Form 10-K for the year ended December 31,
 2000.  These include risks and uncertainties relating to: our history of
 operating losses, our ability to execute on our revised strategic plan, our
 ability to effectively restructure our operations, market acceptance of new
 product releases, continued development and growth of the content management
 product market, dependence on third party technology, difficulty in predicting
 quarterly results, lengthy sales cycles for our products, development and
 maintenance of relationships with our service partners, competitive pressures,
 product development and rapid technological change, attracting and retaining
 key employees, risks associated with international operations, dependence on
 intellectual property rights, possible changes in government regulations,
 dependence on the continued development and maintenance of the Internet,
 security issues, litigation and the costs thereof.
 
     Open Market, Catalog Centre, Content Centre, Content Server, Integration
 Centre, Marketing Studio, Personalization Centre, Satellite Server, ShopSite,
 Transact, and FutureTense are trademarks or registered trademarks of Open
 Market, Inc. in the United States and other countries. All other names are
 used for identification purposes only and may be trademarks of their
 respective owners.  Sun, Sun Microsystems, the Sun Logo, Java and J2EE are
 trademarks or registered trademarks of Sun Microsystems, Inc. in the United
 States and other countries.
 
                               OPEN MARKET, INC.
          CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
                     (in thousands, except per share data)
 
                                                        Three Months Ended
                                                             March 31
                                                         2001           2000
     Revenues
     Product revenues                                  $6,299        $15,355
     Service revenues                                   6,715          9,468
                          Total revenues               13,014         24,823
     Cost of revenues
     Product revenues                                     598          2,376
     Service revenues                                   6,285          7,714
                          Total cost of revenues        6,883         10,090
 
     Gross profit                                       6,131         14,733
 
     Operating expenses
     Selling and marketing                             10,744         10,477
     Research and development                           5,149          6,036
     General and administrative                         2,699          2,372
     Amortization of intangibles                          450            765
     Merger Costs
     Restructuring Costs
                          Total operating expenses     19,042         19,650
 
     Loss from operations                            (12,911)        (4,917)
 
 
     Gain from Sale of Asset                            4,710              -
 
     Interest income                                      141            352
     Interest expense                                   (363)           (93)
     Other expense                                      (124)           (58)
     Loss before provision for income taxes           (8,547)        (4,716)
 
     Provision for taxes                                  115             52
 
     Net loss                                       $ (8,662)      $ (4,768)
 
     Accretion of preferred stock dividends                29              -
 
 
     Net loss applicable to common shareholders     $ (8,691)      $ (4,768)
 
     Net loss per share - basic and diluted           $(0.19)        $(0.11)
 
     Weighted average shares outstanding -
      basic and diluted                                46,832         44,401
 
 
               CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
                                 (in thousands)
 
                                                      March 31,   December 31,
                                                         2001           2000
     Assets
     Cash, cash equivalents & marketable securities   $14,755        $30,430
     Trade accounts receivable, net                    15,541         22,385
     Prepaid expenses and other current assets          3,886          4,481
                          Current assets               34,182         57,296
     Property and equipment, net                        8,255          9,046
     Intangible assets, net                                 -          2,657
     Other assets                                       1,075          1,076
                          Total assets                $43,512        $70,075
 
     Liabilities, redeemable convertible preferred stock and stockholders'
     equity
     Short-term note payable                               $-        $17,405
     Accounts payable and accrued expenses             19,206         24,001
     Deferred revenues                                  6,981          8,012
                          Current liabilities          26,187         49,418
 
     Redeemable convertible preferred stock             3,557              -
 
 
     Common stock, additional paid-in
      capital and other equity                        224,797        222,993
     Accumulated deficit                            (211,029)      (202,336)
     Total liabilities, redeemable
      convertible preferred stock
      and stockholders' equity                        $43,512        $70,075
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X12632836
 
 

SOURCE Open Market, Inc.
    BURLINGTON, Mass., April 26 /PRNewswire/ --Open Market, Inc.,
 (Nasdaq: OMKT), a provider of content-driven e-business solutions, today
 announced financial results for its first quarter ended March 31, 2001.
 Net revenues for the three months ended March 31, 2001, were $13.0 million,
 compared to net revenues of $24.8 million for the first quarter of 2000.
 Net loss for the first quarter ended March 31, 2001, including a $4.5 million
 non-operating gain related to the sale of certain technology assets to
 NextPage Inc. as previously announced, was $8.7 million, compared to a net
 loss of $4.8 million for the first quarter ended March 31, 2000.
     Revenues by line of business for the three months ended March 31, 2001 and
 2000(in millions), were as follows:
 
     Business Segment                    Q1 01          Q1 00     (Decline)
                                                                    Growth
     Content-driven
      e-Business Solutions              $7.7            $9.7         (21%)
     Transact/ShopSite                  $3.6           $13.8         (74%)
     NextPage/Other                     $1.7            $1.3          31 %
     Total                             $13.0           $24.8        (48 %)
 
     "A substantial portion of our revenue decline in Q1 2001, as compared to
 Q1 2000, relates to expected declines in our heritage commerce business. In
 addition, the slowing economy and uncertain business climate, which is
 adversely affecting many technology companies worldwide, also impacted our
 content management and delivery business, particularly in North America",
 stated Harland LaVigne, president and CEO of Open Market.
     "Despite these Q1 results, and the uncertain impact on IT spending
 resulting from a continuation of the soft external economic environment, we
 believe our revised strategy and commitment to the content management and
 delivery market, best positions us for long term success," LaVigne continued.
 "We remain focused on achieving our previously announced goal of attaining
 profitability in the fourth quarter of 2001.  The reduction in our cost
 structure in early April 2001, as previously announced, should assist us
 towards this end, and we will continue to monitor our cost structure as
 appropriate."
 
     New Business
     During Q1 2001, Open Market's content management and delivery solutions
 were selected by some of the world's leading enterprises in the media,
 financial services, and manufacturing industries.  These included companies
 such as Flextech Television Ltd., the U.K.'s largest supplier of themed
 channel programming; Netway Communications AG, providers of hosting and
 communications services; Alstom Holdings serving the energy infrastructure and
 transportation markets in over 70 countries; ChemWeb.com a portal site for
 over 250,000 of the world's chemical researchers; and Cofiniti, a leading
 developer of financial management software for the retail financial services
 industry.
 
     Products
     During Q1, Open Market announced its new product family, Content
 Server(TM) Enterprise Edition (CSEE), adding new e-marketing and business-to-
 business integration (B2Bi) capabilities to its award-winning content
 management and delivery system.  CSEE is designed, developed, and deployed as
 Java components built on leading Java(TM) 2 Enterprise Edition (J2EE(TM))
 application servers including the IBM WebSphere(R) Application Server, the BEA
 WebLogic Server(TM), and the iPlanet Application Server(TM). CSEE is the
 industry's first content management and delivery solution built directly on
 top of all three of these leading e-business platforms, reinforcing Open
 Market's long-standing Java and open standards development strategy.
     During the first quarter, Open Market's Content Server product family was
 once again recognized by one of the industry's leading analyst organizations.
 In January and February 2001, Forrester Research, Inc. (Nasdaq: FORR) ranked
 Open Market's Content Server(TM) product family first in its eBusiness
 TechRankings(TM) research and testing of content management vendors. The
 February award was the third consecutive month that Open Market had received
 the No. 1 ranking. In maintaining the top position in December, January and
 February, Open Market scored higher than the offerings of 12 other market-
 leading content management vendors.
 
     Partnerships
     During Q1 2001, the Company continued to devote efforts towards advancing
 its relationships with the leading application server vendors whose products
 they support.
     During the quarter, Open Market further strengthened its strategic
 alliance with IBM by announcing our support for AIX an open, scalable UNIX(R)
 operating system designed to support critical Internet and e-commerce
 applications.  An integrated CSEE and IBM WebSphere Application Server
 solution was shipped to a major U.S. insurance firm for the deployment of a
 scalable intranet project designed to enable the firm to reduce their total
 cost of ownership by standardizing on a joint IBM/Open Market solution.  A
 similar solution was also installed at a leading U.S. chemical manufacturer
 for the development of a comprehensive customer information site.   In
 addition, the company participated in several IBM industry events including
 Fasttrack, WebSphere 2001, PartnerWorld, and Link 2001.
     In Q1 2001, Open Market also continued its co-selling model with BEA
 Systems closing 11 new business deals to enterprises worldwide. Open Market
 was named a top-tier BEA Three Star Partner as a result of influencing at
 least $1 million in sales of BEA products during 2000.  In addition, Open
 Market has extended its relationship with the company by initiating a new
 partnership with the BEA
 E-Commerce Application Division.
     Finally, advancing its longtime strategic alliance with iPlanet(TM), Open
 Market participated in co-marketing events such as the multi-city roadshow
 Scale the World and the IEB industry event.
 
     About Open Market
     Open Market, Inc. makes content-driven e-business solutions that enable
 enterprises to better manage interactions with their site visitors, customers,
 employees, and channels. Leveraging the new Java(TM) 2 Platform Enterprise
 Edition (J2EE(TM)) standard, the Company's software products are built with
 Java, JSP and XML and are layered on top of popular application servers like
 the BEA WebLogic Server, the IBM WebSphere Application Server and the iPlanet
 Application Server. Open Market's roster of global customers includes
 publishers and media companies like The McGraw-Hill Companies, The Washington
 Post and The New York Times Company; financial services companies like Chase
 Manhattan Bank, GE Capital and The Hartford Financial Services Group; and
 manufacturers like 3Com, BASF and Milacron. The company, headquartered in
 Burlington, Massachusetts, has customers in 39 countries. Open Market's
 international head office is in the U.K. with additional offices in Australia,
 Canada, France, Germany, Italy, Japan, The Netherlands and Singapore. Open
 Market can be reached by calling 1-888-OPEN-MKT (toll-free) or 1-781-359-3000
 in the U.S. or 1753-838-000 in the U.K. or by visiting
 http://www.openmarket.com.
 
     NOTE:  The statements contained in this release regarding our new
 products, new and continuing strategic alliances, revised business strategy,
 the industry's recognition of our new product family, our goal to obtain
 profitability in the fourth quarter of 2001 and all other statements that are
 not purely historical, are forward-looking statements within the meaning of
 the Private Securities Litigation Reform Act of 1995.  All such forward-
 looking statements are based upon information available to us as of the date
 hereof, and we disclaim any intention or obligation to update any such
 forward-looking statements.  Actual results could differ materially from the
 current expectations.  Important factors that could cause actual results to
 differ materially from those indicated by such forward-looking statements are
 set forth under the heading "Certain Factors That May Affect Future Results"
 in the Company's Annual Report on Form 10-K for the year ended December 31,
 2000.  These include risks and uncertainties relating to: our history of
 operating losses, our ability to execute on our revised strategic plan, our
 ability to effectively restructure our operations, market acceptance of new
 product releases, continued development and growth of the content management
 product market, dependence on third party technology, difficulty in predicting
 quarterly results, lengthy sales cycles for our products, development and
 maintenance of relationships with our service partners, competitive pressures,
 product development and rapid technological change, attracting and retaining
 key employees, risks associated with international operations, dependence on
 intellectual property rights, possible changes in government regulations,
 dependence on the continued development and maintenance of the Internet,
 security issues, litigation and the costs thereof.
 
     Open Market, Catalog Centre, Content Centre, Content Server, Integration
 Centre, Marketing Studio, Personalization Centre, Satellite Server, ShopSite,
 Transact, and FutureTense are trademarks or registered trademarks of Open
 Market, Inc. in the United States and other countries. All other names are
 used for identification purposes only and may be trademarks of their
 respective owners.  Sun, Sun Microsystems, the Sun Logo, Java and J2EE are
 trademarks or registered trademarks of Sun Microsystems, Inc. in the United
 States and other countries.
 
                               OPEN MARKET, INC.
          CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
                     (in thousands, except per share data)
 
                                                        Three Months Ended
                                                             March 31
                                                         2001           2000
     Revenues
     Product revenues                                  $6,299        $15,355
     Service revenues                                   6,715          9,468
                          Total revenues               13,014         24,823
     Cost of revenues
     Product revenues                                     598          2,376
     Service revenues                                   6,285          7,714
                          Total cost of revenues        6,883         10,090
 
     Gross profit                                       6,131         14,733
 
     Operating expenses
     Selling and marketing                             10,744         10,477
     Research and development                           5,149          6,036
     General and administrative                         2,699          2,372
     Amortization of intangibles                          450            765
     Merger Costs
     Restructuring Costs
                          Total operating expenses     19,042         19,650
 
     Loss from operations                            (12,911)        (4,917)
 
 
     Gain from Sale of Asset                            4,710              -
 
     Interest income                                      141            352
     Interest expense                                   (363)           (93)
     Other expense                                      (124)           (58)
     Loss before provision for income taxes           (8,547)        (4,716)
 
     Provision for taxes                                  115             52
 
     Net loss                                       $ (8,662)      $ (4,768)
 
     Accretion of preferred stock dividends                29              -
 
 
     Net loss applicable to common shareholders     $ (8,691)      $ (4,768)
 
     Net loss per share - basic and diluted           $(0.19)        $(0.11)
 
     Weighted average shares outstanding -
      basic and diluted                                46,832         44,401
 
 
               CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
                                 (in thousands)
 
                                                      March 31,   December 31,
                                                         2001           2000
     Assets
     Cash, cash equivalents & marketable securities   $14,755        $30,430
     Trade accounts receivable, net                    15,541         22,385
     Prepaid expenses and other current assets          3,886          4,481
                          Current assets               34,182         57,296
     Property and equipment, net                        8,255          9,046
     Intangible assets, net                                 -          2,657
     Other assets                                       1,075          1,076
                          Total assets                $43,512        $70,075
 
     Liabilities, redeemable convertible preferred stock and stockholders'
     equity
     Short-term note payable                               $-        $17,405
     Accounts payable and accrued expenses             19,206         24,001
     Deferred revenues                                  6,981          8,012
                          Current liabilities          26,187         49,418
 
     Redeemable convertible preferred stock             3,557              -
 
 
     Common stock, additional paid-in
      capital and other equity                        224,797        222,993
     Accumulated deficit                            (211,029)      (202,336)
     Total liabilities, redeemable
      convertible preferred stock
      and stockholders' equity                        $43,512        $70,075
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X12632836
 
 SOURCE  Open Market, Inc.

RELATED LINKS

http://www.openmarket.com