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Prescient Applied Intelligence Reports Second Quarter 2008 Results
WEST CHESTER, Pa. --(Business Wire)-- Prescient Applied Intelligence, Inc. (OTCBB:PPID), a leading provider of supply chain and advanced commerce solutions for retailers and suppliers, today reported financial results for the second quarter ended June 30, 2008.
SECOND QUARTER HIGHLIGHTS
Revenues
-- Total revenue was $2.1 million for the second quarter of 2008, which represented a decrease of 16% compared to the second quarter of 2007 and a 2% increase over the first quarter of 2008. The comparable quarter in 2007 included non-recurring revenue from a significant client that terminated its relationship with the Company during 2007.
Income
-- The Company recorded a net loss of ($7.2) million for the three months ended June 30, 2008. The Company's net loss reflects an impairment of goodwill of $7.5 million. Without the impairment, the Company would have reported net income of $0.3 million, representing a 35% decrease over the same period in 2007, and an increase of 160% from the first quarter of 2008.
-- The net loss applicable to common stockholders was ($7.6) million or ($0.23) per share for the second quarter of 2008 which includes accumulated undeclared dividends to the Series E Preferred stockholders of $0.3 million resulting from a beneficial conversion feature. This compares to a net loss applicable to common stockholders of ($0.03) million or ($.00) per share for the same period prior year.
"Our monthly subscription rate for our communities grew over 19% from the prior quarter as we see increased adoption of our Visibility and Analytics suite, as well as growth in our collaborative Scan Based Trading service," said Jane Hoffer, president and CEO of Prescient. "We continue to regain the revenues lost in 2007 by the departure of one of our largest communities. We are pleased by the response of our installed base of clients to our new product offerings."
Operating Expenses
-- Total operating expenses in the second quarter 2008 were $9.3 million, including $7.5 million impairment of goodwill, and $0.1 million of depreciation and amortization. Excluding the impairment to goodwill, operating expenses decreased $0.3 million or 13% compared to the same period in 2007 and decreased 4% from the first quarter of 2008.
Cash & Cash Equivalents
-- Cash provided by operations was $0.3 million during the six months ended June 30, 2008 as compared to $0.5 million in the same period in the prior year. Cash and cash equivalents were $2.8 million as of June 30, 2008, up from $2.6 million at December 31, 2007 and $1.2 million at June 30, 2007.
"Our new product release schedule continued in the second quarter with the introduction of the third in the series of Visibility and Analytics (V&A) modules," said Jane Hoffer, president and CEO of Prescient. "The new Inventory Module assists our clients in analyzing item at store level perpetual inventory, as well as the flow rate of product at store level. All of our V&A modules are assisting both retailer and supplier reduce out of stocks at store level."
About Prescient Applied Intelligence:
Prescient, founded in 1985 (OTCBB:PPID), provides innovative software solutions and services that enable retailers and suppliers to work collaboratively as strategic partners to improve sales, efficiencies, and customer service. Our tailored solutions capture, manage, and share critical data, giving companies the power to make better and more informed decisions. Our offerings include Vendor Managed Inventory, Store Level Replenishment, Scan Based Trading, and Visibility & Analytics(TM) business intelligence solution, which are all powered by our Demand Signal Repository (DSR). The comprehensive commerce data, aggregated by the DSR, brings greater visibility throughout the supply chain enabling businesses to forecast with more accuracy, reduce stock-outs and shrink, and improve performance at the store shelf. For more information, go to www.prescient.com.
Forward-Looking Statement: Any statements contained in this document that are not historical facts are forward-looking statements as defined in the U.S. Private Securities Litigation Reform Act of 1995. Words such as "anticipate," "believe," "estimate," "expect," "forecast," "intend," "may," "plan," "project," "predict," "if," "should" and "will" and similar expressions as they relate to Prescient Applied Intelligence, Inc. are intended to identify such forward-looking statements. Prescient may from time to time update these publicly announced projections, but it is not obligated to do so. Any projections of future results of operations should not be construed in any manner as a guarantee that such results will in fact occur. These projections are subject to change and could differ materially from final reported results. For a discussion of such risks and uncertainties, see "Risk Factors" in Prescient's report on Form 10-QSB filed with the Securities and Exchange Commission and its other filings under the Securities Exchange Act of 1934, as amended. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the dates on which they are made.
Prescient Applied Intelligence, Inc.
CONDENSED CONSOLIDATED BALANCE SHEETS
June 30, 2008 and December 31, 2007
June 30, December 31,
2008 2007
-----------------------------
ASSETS (unaudited)
Current assets:
Cash and cash equivalents $ 2,795,884 $ 2,594,149
Accounts receivable - net of
allowance for doubtful accounts of
$35,000 at June 30, 2008 and $43,000
at December 31, 2007 977,425 1,236,603
Prepaid and other current assets 194,844 100,504
-------------- --------------
Total current assets 3,968,153 3,931,256
Furniture, equipment and leasehold
improvements, net 183,939 200,057
Intangible assets, net 1,100,000 1,300,000
Goodwill 9,804,285 17,257,483
Other assets 53,503 49,342
-------------- --------------
Total Assets $ 15,109,880 $ 22,738,138
============== ==============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion note payable $ 203,492 $ 169,696
Accounts payable 152,317 163,526
Accrued expenses 451,645 632,648
Income taxes payable 15,000 29,071
Deferred revenues 1,145,355 1,357,953
-------------- --------------
Total current liabilities 1,967,809 2,352,894
Deferred maintenance - long-term portion 29,049 67,884
Long term portion note payable, net of
discount of $11,122 at June 30, 2008
and $15,889 at December 31, 2007 2,113,020 2,228,314
-------------- --------------
2,142,069 2,296,198
-------------- --------------
Stockholders' equity:
Series E Preferred Stock, $.001 par
value; 1,660 shares authorized;
1,657 shares issued and outstanding
at June 30, 2008 and December 31,
2007 (liquidation value $19,550,849
and $18,889,955 at June 30, 2008 and
December 31, 2007, respectively) 16,567,747 16,567,747
Series G Preferred Stock, $.001 par
value; 480 shares authorized; 479.9
shares issued and outstanding at
June 30, 2008 and December 31, 2007
(liquidation value $4,798,838 at
June 30, 2008 and December 31, 2007) 4,798,838 4,798,838
Common stock, $.001 par value;
400,000,000 shares authorized;
33,560,791 and 33,600,251 shares
issued and outstanding at June 30,
2008 and December 31, 2007,
respectively 33,561 33,600
Additional paid-in-capital 104,813,349 104,754,887
Accumulated deficit (115,213,493) (108,066,026)
-------------- --------------
Total stockholders' equity 11,000,002 18,089,046
-------------- --------------
Total liabilities and
stockholders' equity $ 15,109,880 $ 22,738,138
============== ==============
Prescient Applied Intelligence, Inc.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
For the Three and Six months ended June 30, 2008 and 2007
(unaudited)
Three months ended June 30, Six months ended June 30,
--------------------------- -------------------------
2008 2007 2008 2007
------------ -------------- ------------ ------------
Revenue:
Subscription
services $ 1,470,795 $ 1,522,102 $ 2,839,507 $ 3,092,261
Licenses 40,000 228,286 90,000 359,222
Maintenance 379,538 388,170 751,278 784,712
Professional
services 216,988 372,207 492,905 718,945
------------ -------------- ------------ ------------
Total
revenue 2,107,321 2,510,765 4,173,690 4,955,140
------------ -------------- ------------ ------------
Operating
expenses:
Customer[FEED_CRL
F] operations and
support 548,195 719,194 1,150,139 1,397,480
Development 304,891 223,906 623,641 546,129
Selling and
marketing 473,076 542,431 945,645 1,040,973
General and
administrative 403,557 509,445 821,219 1,050,238
Impairment of
goodwill 7,453,198 - 7,453,198 -
Depreciation
and
amortization 115,730 115,765 233,927 232,548
------------ -------------- ------------ ------------
Total
operating
expenses 9,298,647 2,110,741 11,227,769 4,267,368
------------ -------------- ------------ ------------
Income (loss)
from operations (7,191,326) 400,024 (7,054,079) 687,772
Other income
(expense):
Interest
expense (44,960) (69,329) (99,194) (138,960)
Interest income 11,277 - 21,735 -
------------ -------------- ------------ ------------
Total
other
expense (33,683) (69,329) (77,459) (138,960)
Net income
(loss) before
provision for
income taxes (7,225,009) 330,695 (7,131,538) 548,812
Provision for
income taxes 7,500 - 15,929 -
------------ -------------- ------------ ------------
Net income
(loss) (7,232,509) 330,695 (7,147,467) 548,812
Deemed dividend
on Series E
Preferred
Stock - (172,810) - (515,532)
Undeclared
dividend on
Series E
Preferred
Stock (330,447) (165,224) (660,894) (328,632)
Accrued damages
to certain
preferred
shareholders - (20,250) - (20,250)
------------ -------------- ------------ ------------
Net loss
applicable to
common
stockholders $(7,562,956) $ (27,589) $(7,808,361) $ (315,602)
============ ============== ============ ============
Net loss
applicable per
common share -
basic and
diluted $ (0.23) $ (0.00) $ (0.23) $ (0.01)
============ ============== ============ ============
Weighted average
common shares
outstanding -
basic and
diluted 33,560,791 33,326,670 33,572,282 33,326,670
============ ============== ============ ============
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