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Re: Overview of HCV Therapies in Development
Dew, very nice summary and very much appreciated. Thank you,
Rich
IDIX -
Dew, what (if any) do you make of the recent information provided by a poster identified as "magkfrog" on the Yahoo message board?
Best regards
rw
Dew et al... GTCB
Sincere congratulations for a great job of managing your risk reward. Congrats to all the longs who held on to those shares and picked some up below $1.
Have a great weekend!
GTCB - EMEA update????
Perhaps I missed something but shouldn't GTCB know the results of thier appeal?
TIA
IDIX...at least we are moving north. Have a great weekend!
Re IDIX
I asked gordon939 on the YMB and was told "There is no link. It was research entered into Thompson FirstCall. (you gotta pay to play)". I guess I'm not surprised, YMB posters are for the most part not very helpful (IMHO).
rich
Re IDIX and YMB posters
I rarely bother with YMB anymore. I just cannot tolerate the mud slinging, the BS posts, the day trades, the shorts and the cheerleaders. JMHO
IDIX....I guess a buy in at an average of $11.45 was poor judgment on my part. RTQ is $7.94 at present. Twelve months and a positive ruling by the FDA should change the prospect of this issue long term. What I find amazing is that some investors might still be shorting this issue at current the price.
VRTX...The current valuation is $3.99 Billion. Isn't this issue a little too rich or have I missed something?
Best Regards
IDIX....dido for me as well. I sold "some" of my SOFO for a great return (purchased last December) and purchased more IDIX at $10.07
Have agreat weekend
IDIX...purchased more at $10.89
Toddean & 5K,
I've heard many rumors over the years including one where IBM was going to buy Dell (many years ago). I have very little faith in these types of rumors and do not make my investment decisions based on such hearsay. If a buyout happens, my hope is it will be at a decent PPS which for the long time shareholders whom have been very patient over the years.
Best regards to you both.
Hi urche,
Good luck to you also. I purchased more this AM and honestly believe this is grossly oversold.
This reminds me of AMLN last year at $14-15, now at $47-49.
IDIX....In at $11.50 for 2000 shares. Will added more as/if price goes down. Anyone else buy today?
BR
Dew...Congrats!
The continued sell off of IDIX is overdone IMHO. Are you considering addition to your position?
Rich
IDIX......I almost pulled the trigger today at $11.85. Then I decided to wait until later this afternoon to see what happened at the end of day. I'm a hopeful buyer soon and prepared to jump in at this level.
Hey PCF,
If SOFO YMB continues to attract the nasty vermin (day traders), we will at least have a good place to move to. I did hear you mention and look forward to our next meeting during the summer months, just let me know when you guys decide to take the afternoon off.
BR
GENR
anyone...what do you make of the recent "insider" purchases by GENR executives?
TIA
OT-SOFO
Interesting activity today with very unusual high volume. This issue seems to have attracted a lot of attention lately with perhaps the insider purchasing activity.
I will be attending the Annual Shareholders meeting next Wednesday in Madison WI, and will provide commentary on I-Hub board created for SOFO.
regards
Here are my personal thoughts on Sonic Foundry (all IMHO) as of today.
Sales growth from quarter to quarter has been very encouraging. SOFO continue to improve on many different levels.
SOFO is no longer just a “hardware” company. They now are incurring services revenue that is also growing nicely but need to continue.
Valuation play. I feel that the market capitalization for SOFO today (30-40 Million) is very appealing. With the estimated growth rate that SOFO management foresees and has discussed on their recent quarterly update, I continue to believe the future of SOFO is very positive.
Management reiterated recently that they still expect to reach $15 Million in sales for 2006. They had a chance recently to revise these numbers down after a “slow” first quarter, but instead made comments alluding to tremendous growth/project prospects in the upcoming quarters.
I like Mediasite. It is a very simple tool and I believe has tremendous long term value as more individual in the Educational and Government market segments. I believe the other market of tremendous growth lie outside the US territories.
The recent “insider” purchasing by the CEO I believe is a strong positive sign of things to come. I am a simple Midwest individual. A personal investment of $100,000 is a lot of money, at least to my thinking.
If you look at the % amount of insider ownership, they own I believe 17%. Another 22% of the shares are held by Institutional & Mutual Fund Owners. Neither of these groups has sold one share.
Longer term, 12-36 months out, I see SOFO as a strong buyout candidate. The value attached to the buyout is uncertain at this juncture, all depends on how well their sales and service contracts grow and the acceptance of www.MediaSite.com
RW
RE ADH
My thinking as well. I watched it reach $0.95 for a while, then popped back up to $1.05. Will wait & see.
OXGN
I like insider buying!
CITRON JOEL TOMAS (Director)
18,400 @ $3.91
1,600 @ $3.92
OT - SOFO
http://post.messages.yahoo.com/bbs?.mm=FN&action=m&board=9029897&tid=sfo&sid=9029897...
02/27/06 BUINEVICIUS, RIMAS Chairman 6,000 Direct Purchase at $1.23 per share. $7,380
02/21/06 BUINEVICIUS, RIMAS Chairman 11,000 Direct Purchase at $1.20 per share. $13,200
02/15/06 BUINEVICIUS, RIMAS Chairman 7,900 Direct Purchase at $1.13 - $1.15 per share. $9,062
02/14/06 BUINEVICIUS, RIMAS Chairman 15,400 Direct Purchase at $1.10 - $1.15 per share. $17,002
02/10/06 BUINEVICIUS, RIMAS Chairman 25,000 Direct Purchase at $1.04 - $1.05 per share. $26,002
02/09/06 BUINEVICIUS, RIMAS Chairman 10,000 Direct Purchase at $1.02 - $1.04 per share. $10,002
02/09/06 BUINEVICIUS, RIMAS Chairman 21,095 Direct Purchase at $1 - $1.01 per share. $21,002
Recent Insider purchases for SOFO
Total shares purchased in last month 96,395 ($103,586)
02/27/06 BUINEVICIUS, RIMAS Chairman 6,000 Direct Purchase at $1.23 per share. $7,380
02/21/06 BUINEVICIUS, RIMAS Chairman 11,000 Direct Purchase at $1.20 per share. $13,200
02/15/06 BUINEVICIUS, RIMAS Chairman 7,900 Direct Purchase at $1.13 - $1.15 per share. $9,062
02/14/06 BUINEVICIUS, RIMAS Chairman 15,400 Direct Purchase at $1.10 - $1.15 per share. $17,002
02/10/06 BUINEVICIUS, RIMAS Chairman 25,000 Direct Purchase at $1.04 - $1.05 per share. $26,002
02/09/06 BUINEVICIUS, RIMAS Chairman 10,000 Direct Purchase at $1.02 - $1.04 per share. $10,002
02/09/06 BUINEVICIUS, RIMAS Chairman 21,095 Direct Purchase at $1 - $1.01 per share. $21,002
1st Qtr 2006 summary as I see it:
Cash down $0.854 M (not so good)
Receivables down $0.576 M compared to Q4 2005 (not so good)
Inventories up $0.184 M compared to Q4 2005 (not so good)
Accounts payable down $0.441 M compared to Q4 2005 (good)
Accrued liabilities down $0.339 M compared to Q4 2005 (good)
Total current liabilities down $0.638 compared to Q4 2005 (good)
Total cash & equiv down to $3,417 M (a growing concern)
The question I have is does SOFO foresee a significant financing deal in 2006
Sonic Foundry Reports First Quarter Results for Fiscal 2006
http://biz.yahoo.com/prnews/060202/lath044a.html?.v=1
MADISON, Wis., Feb. 2 /PRNewswire-FirstCall/ -- Sonic Foundry® Inc. (Nasdaq: SOFO - News), a leader in automated rich media communications technology, announced results for its first quarter of fiscal 2006. Financial and company highlights for the first quarter include:
* Revenues increase 18 percent year-to-year. For the first quarter of fiscal 2006, Sonic Foundry reported revenues of $1.9 million, an increase of 18 percent from $1.6 million reported for the first quarter of fiscal 2005. During this seasonally slow period, the company reported a net loss of $1.6 million or five cents per share for the first quarter of fiscal 2006 compared to $1.4 million or five cents per share in Q1-2005. Current period results include non-cash expense of $182 thousand related to a new accounting rule change requiring companies to record the cost of issuing stock options.
* Multi-unit sales grow as customer base rapidly expands. The customer base at the end of the first quarter of 2006 was 491, a 79 percent increase over the first quarter last fiscal year. The company reported multi-unit sales in key verticals including education (University of Cincinnati and Victoria University), government (Maryland House of Delegates) and corporate (Raytheon). Other new customers include Mutual of Omaha, Merck, Carnegie Mellon and the Tiger Woods Learning Center.
* Sonic Foundry featured in Dell Intelligent Classroom. As previously announced, Sonic Foundry recently became a supplier to the Dell education channel with a significant role in Dell's Intelligent Classroom marketing and sales initiative. In anticipation of this new initiative, first quarter sales and marketing efforts were focused on creating and planning new marketing programs as well as conducting initial sales training and customer visits with Dell personnel. This new distribution channel is expected to diversify Sonic Foundry's reach, especially in education sales, both to the higher education and K-12 markets.
* EX Server ships late in Quarter. Shipment of EX server software occurred later than anticipated in the quarter and therefore provided no significant contribution to revenues. However, the new offering has attracted large enterprise customers who are interested in deploying the highly scalable, secure rich media software platform. As such, the company expects larger contributions from server software license sales in the future and may potentially see dramatic swings in future sequential quarter results due to full scale enterprise deployments based on EX.
* Cash flow breakeven expected during fiscal 2006. As reported at fiscal 2005 year end, the company projected a seasonally slow quarter for the fiscal 2006 first quarter, with a significant pick up in business expected for the balance of fiscal 2006. The company believes it remains on pace to achieve breakeven operations some time in fiscal 2006
and has sufficient working capital to reach breakeven operations.
* Customer support revenues more than double. Customer support revenue represents the portion of fees charged for Mediasite SmartServe service contracts as well as training and installation services. In the first quarter of fiscal 2006, customer support revenue was $415,000, up from $189,000 in the first quarter of fiscal 2005. The increase was due primarily to support contracts on new Mediasite sales and renewals. At December 31, 2005, $1.1 million of unearned revenue was recorded for service and support contracts to be recognized in upcoming quarters.
* Gross margins improve from the same period one year earlier. For the first fiscal quarter of 2006, gross margins increased to 70 percent, up from 66 percent in the first quarter of 2005. Mediasite customer support revenues and server license fees contributed to the increase. The company expects margins for fiscal 2006 to be in the low 70's percent range.
* Improved search capabilities. Sonic Foundry introduced Mediasite.com, a website that aggregates public presentations created with Mediasite systems. Users can search for specific content in one location with a simple search phrase. Throughout the first quarter of fiscal 2006, the company's advanced R&D group incorporated unique ways in which data can
be indexed. Users are now employing these advanced search capabilities to drill further down into rich media communications that have been difficult to find, even through the use of traditional search engines like Google, Yahoo or MSN. Based on the initial positive reaction of customers, the company expects this initiative will lead to new products and services that further advantage the customer base with the Mediasite platform. Development efforts are now under way that provide for new automated metadata extraction and archiving technology, specific customizations and new hosting services.
"Over the last three years, we have evangelized our Mediasite product line as a new form of communication technology geared specifically to information providers," said Rimas Buinevicius, chairman and CEO of Sonic Foundry. "We've found that whether it's the professor, CEO, reporter, health care provider, product manager, lawyer or engineer, they all have one thing in common: a fundamental need to share knowledge and information quickly, and above all easily, with those that seek it. What makes Sonic Foundry unique is our ability to adapt the early ideas of television, telephony and audio/video production and meld them into an entirely new form of communication that is changing the way people deliver their message. This is still just the beginning of what we expect will turn into thousands of devices capturing and transmitting information for millions of hours of content, all accessible on a distributed network basis."
Sonic Foundry will host a Webcast today to discuss its first quarter 2006 results at 10:00 a.m. CT/11 a.m. ET. It will use Mediasite to Webcast the presentation for both live and on-demand viewing. To access the presentation, go to www.sonicfoundry.com. An archive of the Webcast will be available for 30 days.
About Sonic Foundry®, Inc.
Founded in 1991, Sonic Foundry (Nasdaq: SOFO - News) is a technology leader in the emerging rich media communications marketplace, providing enterprise solutions and services that link an information driven world. Sonic Foundry is changing the way organizations communicate via the Web and how people around the globe receive vital information needed for work, professional advancement, safety and education. The company's integrated Webcasting and Web presentation solutions are trusted by Fortune 500 companies, education institutions and government agencies for a variety of critical communication needs. Sonic Foundry is based in Madison, Wis. For more information about Sonic Foundry, visit the company's Website at www.sonicfoundry.com.
Certain statements contained in this news release regarding matters that are not historical facts may be forward-looking statements. Because such forward-looking statements include risks and uncertainties, actual results may differ materially from those expressed in or implied by such forward-looking statements. Factors that could cause actual results to differ materially include, but are not limited to, uncertainties pertaining to continued market acceptance for Sonic Foundry's products, its ability to succeed in capturing significant revenues from media services and/or systems, the effect of new competitors in its market, integration of acquired business and other risk factors identified from time to time in its filings with the Securities and Exchange Commission.
GTCB - apropos Insider buying....Maybe the management team had a "feeling" things were not going their way. Then again, maybe not.
BR
GTCB - I voted for answer "b". This is a tough day for most of us.
I'm heading for Guangzhou for a customer audit of two Glucosamine facilities. The recent headlines about Glucosamine & CS are not surprising. It will be very interesting to see if this impacts sales of G&CS in the year to come.
Best Regards,
RW
PS DEW...Hope you Dad is doing well.
Dew...Hope everything turns out OK and sincerely hope it's not too serious.
BR Rich
GTCB
I would like to purchase more shares but frankly this is or appears very suspicious to me. I'll pass for now, thank you. For 18 months this thing has been like a yoyo. Good luck!
Rich
Genentech's 4Q Earnings Match Expectations
Wednesday January 11, 1:00 am ET
By Michael Liedtke, AP Business Writer
Genentech's Fourth-Quarter Earnings Match Analyst Expectations
http://biz.yahoo.com/ap/060111/earns_genentech.html?.v=2
SAN FRANCISCO (AP) -- Genentech Inc.'s ability to develop a series of breakthrough drugs has helped establish it as one of the nation's smartest companies. Coming off one of the best years in its history, the biotechnology bellwether must now tackle a different kind of challenge -- managing investors' rising expectations.
Wall Street's response to the South San Francisco-based company's fourth quarter earnings, released Tuesday, suggests that won't be an easy task.
The company's profit rose 64 percent, yet it still wasn't good enough to propel its high-flying stock because of Genentech's recent history of surpassing expectations.
Net income for the three months ended in December totaled $339.2 million, or 32 cents per share. That compared with a profit of $206.6 million, or 19 cents per share, at the same time in 2004.
Fourth-quarter revenue hit $1.89 billion, a 44 percent increase from the previous year.
If not for accounting expenses unrelated to its ongoing operations, Genentech said it would have earned 34 cents per share to equal the average estimate among analysts surveyed by Thomson Financial.
It marked the first time in a year that Genentech's quarterly earnings didn't exceed analyst expectations by least 4 cents per share.
That succession of pleasant surprises helped boost Genentech's stock price by 70 percent last year, adding $40 billion in shareholder wealth as the company overtook Amgen Inc. as the biotech's most valuable company.
The latest results were released after the stock market closed. Genentech's shares gained 68 cents to close at $93.34 on the New York Stock Exchange, then shed $2.39, or 2.6 percent, in extended trading.
Arthur Levinson, Genentech's chief executive, painted a rosy outlook for analysts during a Tuesday conference call, predicting the company will be able to balance Wall Street's desire for short-term financial growth while continuing to develop new drugs that often require years of expensive testing.
"We believe the scientific opportunities before us are as exciting as they have ever been," Levinson said.
In a bullish sign, Levinson said Genentech plans to hire about 1,400 additional employees this year, a 15 percent increase from its current work force of 9,500 worldwide. Genentech added roughly 1,900 workers last year, a 25 percent increase from 2004.
The earnings growth during 2006 is likely to slacken slightly from 2005's pace on a so-called "pro-forma" basis -- a calculation that strips out accounting items that don't affect the ongoing operations. This earnings approach is favored by many investors.
Genentech also excluded stock option expenses of 15 cents to 17 cents per share from its 2006 forecast, which envisions an earnings increase of 35 percent to 45 percent. In 2005, Genentech's pro-forma earnings rose by 54 percent.
Based on Tuesday's estimates, Genentech's pro-forma earnings this year will range between $1.73 and $1.86 per share. The average estimate among analysts had been $1.18 per share, according to Thomson Financial.
Genentech's recent prosperity largely stems from sales of its flagship product, the non-Hodgkin's lymphoma drug Rituxan, and a relative newcomer called Avastin that has been approved to treat the sickest colon cancer patients.
Fourth-quarter sales of Rituxan totaled $484 million, a 13 percent increase from the comparable 2004 period.
Meanwhile, fourth-quarter sales of Avastin increased 89 percent to $359 million. Genentech's management is hoping to win regulatory approval to allow Avastin to treat lung and breast cancers, a breakthrough that would provide a significant sales stimulus. As it was, Avastin's sales for all of 2005 more than doubled to $1.1 billion.
Under the accounting principles mandated by securities regulators, Genentech earned $1.28 billion, or $1.18 per share, on revenue of $6.63 billion. In 2004, the company's profit totaled $784.6 million, or 73 cents per share, on revenue of $4.62 billion.
http://www.gene.com
Open positions @ SOFO
by: rwwine (40/M/Milwaukee, WI) 01/08/06 09:46 am
Msg: 25113 of 25113
According to Sonic's website, they have the following open positions:
Software Engineer - Rich Media Systems
NET Web Developer
Software Engineer - Web Development
Number of employees stands at 63
Over the holidays I watched a presentation by Sean Brown (SOFO) on October 21, 2005 and thought it was excellent. It helped me better understand the Mediasite functions & capabilities. During Sean's presentation, he mentioned Scott McNealy’s presentation (of Sun Microsystems). When I tried to access this presentation on the “Mediasite website” this last week, I received a message saying "Your search for Scott McNealy returned no results". This was rather frustrating since Rimas made a point that with Google, you had to click 5-6 times before your could find the presentation you were hunting for. At the end of the day and I found the presentation at Educause website (not Mediasite), maybe 20 clicks.
http://www.educause.edu/content.asp?page_id=9337&bhcp=1
http://fp3demo.mediasite.com/fp3demo/Viewer/NoPopupRedirector.aspx?peid=9955469f -0425-4b11-abfd-911f4396760e&shouldResize=False
I also found that when I attempted to send SOFO comments about their Mediasite website, I could not get confirmation that my email went to either the SOFO contact page or the Mediasite contact page.
In all fairness, Mediasite is classified as a "beta" program which will improve over time.
Best Regards,
Rich
GTCB
My nagging (minor) ongoing concern with the GTCB management team is why they collectively own so little of this company, especially at such a low pps.
If each executive purchased on the open market say 20 to 100k shares, I think this would send the investment community a "strong" positive message.
Happy New Year!!
Thanks Dew for your hard work.
Best Regards
Re: Pfizer survey
FWIW, I voted for "f) None of the above.". In the industry I service, Nutritional Supplements, it is widely known that CoQ10 supplementation should be strongly promoted for all those that take statin type drugs. Statin drugs inhibit the human bodies’ ability to natural synthesizes CoQ10. CoQ10 is considered an excellent supplement focused on improving "heart health". For more information, please see the following link.
http://www.atdonline.org/pdf/CoQ10-HeartDisease.pdf
I feel it is feasible that Kaneka, a Japanese company who is currently building an $80 million factory in Pasadena, Texas, may position themselves with PFE to promote a new product, a combination therapy if you will where Lipitor/CoQ10 could be lunched as a new "patented" product.
For more on Kaneka, please see the following link.
http://www.nutraingredients.com/news-by-health/news.asp?id=53873&k=kaneka-further-expands
FWIW, I sell sythetic Coenzyme Q10 USP grade manufactured by Daewoong in Korea. Going price today is $1350/kg.
Best Regards,
Rich
Road to Breakeven
Posted on YMB. After I carefully review of the information that Sonic Foundry management recently provided, I have summarized my opinion regarding future earns as outlined below.
If you extrapolate the two lines in the graph titled “Road to Breakeven” which is 31 minutes into the Fiscal 2005 Investor Presentation, you “could” come to the conclusion that if the slope of these two lines (GM/Employee & Expense/Employee) remain the same, that breakeven “should” occur in Q3 of 2006.
My best guess (SWAG) based on this assumption is we should see the following financial results for the upcoming quarters.
Q1 of 2006 -0.02/eps
Q2 of 2006 -0.01/eps
Q3 of 2006 0.00/eps (breakeven)
Q4 of 2006 0.01/eps
Therefore, Fiscal 2006 net result should be -0.02/eps.
Agree?
OT - SOFO
Dew,
Thanks for the additional color which I placed on the I-Hub board recently created to discuss the company’s prospects. Good, bad or indifferent, we need these types of opinions to keep balanced.
http://www.investorshub.com/boards/read_msg.asp?message_id=8790749
Thank you
Article apropos Mediasite.com
Thanks to IAM5000 on the YMB for the article find
http://wistechnology.com/article.php?id=2531
Sonic Foundry creates search engine for 7,000 expert video presentations
Eric Kleefeld • Published 12/07/05
Madison, Wis. — Sonic Foundry premiered this week a new Mediasite portal, venturing into what they believe is an untapped audience on the Internet interested in multimedia presentations featuring expert knowledge.
The site features direct links to presentations by users of the company’s rich media software and server tools, which combine audio and video content with other media sources slideshows and text. The site debuted with almost 7,000 presentations, totaling over 5,000 hours of content. Presentations include such subjects as bird flu, distance education, law and politics.
“Most of the glitz you find with entertainment content, or music downloads, or even video iPods, can only focus on Hollywood content,” said CEO Rimas Buinevicius. “We feel that there’s an underserved market here, with information technology that’s out there.”
The site is relatively inexpensive for the company to maintain, in that it does not actually host or stream video content. Instead, a program scans the Web for Mediasite presentations, and content providers also submit their entries to Sonic Foundry, who checks to make sure the links work and the content is not inappropriate before entering it into the search engine.
Buinevicius said using on-demand delivery for video content, estimated at an average 60 megabytes for a single hour, can be less expensive than live webcasts.
“There is a huge cost associated with live webcasts, that gets you into extremely expensive bandwidth to meet the needs of instantaneous communications when you go out and do, let’s say, one of the big online live webcasts,” he said. “Rather than doing that, on-demand spreads the cost of the bandwidth out so that it’s almost no different than your normal Internet connection.”
Buinevicius said costs for the site would initially be offset by ads, and the company could also negotiate for some percentage on any future offerings that content providers wish to present on a subscription or pay-per-view basis. Additionally, the site would also function as a promotion of the Mediasite presentation technology, though it is too early for Buinevicius to make any prediction on the returns.
"Mediasite.com is interesting and offers a broad spectrum of how the technology is being used,” said David Simpson, director of digital media for Florida State University Academic and Professional Program Services, which uses Sonic Foundry’s technology. “I see value in the site in it being a resource for individuals to view other presentations of interest."
Additional color apropos SOFO lastest CC
CC impressions:
by: DewDiligence 12/08/05 03:58 am
Msg: 25039 of 25039 YMB
I just don’t see why mediasite.com is all that big a deal for SOFO from a business standpoint. In listening to the CC last week, I thought all the attention devoted to the new website was a smokescreen so management wouldn’t have to spend much time talking about the FY2006 sales and earnings forecasts.
I was also disappointed that they did not address the unusual financing transaction.
The questions in the Q&A sounded scripted—I would much prefer a conventional kind of CC where investors and analysts ask their questions live.
JMHO, FWIW
pCf,
I'm comfortable with SOFO performance this last quarter and didn't have an issue with there achievement this year. Last year Rimas said they would reach the 10 Million mark in 2005, but I think that was an unrealistic expectation. It takes time to hire & train sales personnel and in my experience typically takes 12-18 months to see the results. In general, I think it may be incredibly difficult to grow as fast as SOFO has while trying to balance both their resources and cash flow while attempting to please all us inventories.
Take good care!
Rich
Sonic Foundry Reports Year-End Results for Fiscal 2005
Thursday December 1, 6:57 am ET
Mediasite Sales Continue Climbing as Company's End-To-End Solutions Attract Enterprise Customers, Multi-Unit Purchases and Repeat Sales
http://biz.yahoo.com/prnews/051201/lath044.html?.v=35
MADISON, Wis., Dec. 1 /PRNewswire-FirstCall/ -- Sonic Foundry® Inc. (Nasdaq: SOFO - News), a leader in automated rich media communications technology, today announced results for its 2005 fiscal year. Highlights for fiscal 2005 include:
* Revenues increase substantially from a year ago. Annual revenues for
2005 totaled $8.3 million, up 89 percent from $4.4 million reported the
year earlier. Multiple unit sales, repeat purchases from existing
customers, increased sales and marketing efforts, new software offerings
and product enhancements contributed to the significant increase. Units
sold increased 74 percent from 269 in 2004 to 467 in 2005. The company
continues to see marked growth in billings related to customer support,
product services and recently launched hosting services. These items
are initially recorded as unearned revenue and then recognized over
future periods. For fiscal 2005, customer support fees more than
doubled to $975,000 from $425,000 reported for 2004. Total billings for
fiscal 2005 were $8.8 million.
* Annual gross margins increase significantly. Gross margins for fiscal
2005 rose to 67 percent compared to 60 percent for fiscal 2004. As
expected, high margin customer support revenue and licensing of server
software applications accounted for the majority of the increase in
gross margin percentage over 2004 levels. The company anticipates
continued margin increases in the near term attributed to a higher mix
of support, server software, consulting and hosting revenues.
* Operating expenses increase with growth in revenues, marketing and sales
staff. Operating expenses increased to $9.9 million, representing a
20 percent increase compared to the 89 percent top line growth. For
fiscal 2005, the company increased its selling, marketing and customer
support staff by 55 percent. Continued expansion in personnel is
anticipated in fiscal 2006 to maintain current momentum, but is expected
to grow well below projected top line growth. Advertising and tradeshow
expenses increased incrementally as a result of increased tradeshow
attendance and print placements. The company believes these investments
are important in defending its market leadership position and critical
to sustaining the success of new product and service launches announced
in fiscal 2005 and new product offerings planned for fiscal 2006.
* Cash used for operations decreased by almost half. Sonic Foundry
continued to progressively improve its operating cash flow by reducing
cash used for operations from $6.2 million in fiscal 2004 to
$3.3 million in fiscal 2005. Year-to-date, cash used in operating
activities decreased 47 percent due to improved operating results and
reduced working capital needs. For the fourth fiscal quarter of 2005,
total cash burn was reduced to $243 thousand. The company remains
focused on maintaining revenue growth and managing expenses to reach
break-even operating results in the 2006 fiscal year.
* Year-to-year net loss and EPS again improve. Sonic Foundry reported an
improved net loss of $4.2 million for the fiscal year, or 14 cents per
share, versus a loss of $5.4 million, or 18 cents per share, for fiscal
2004.
* Solid customer growth with emphasis on the enterprise. During fiscal
2005, Sonic Foundry expanded its customer base to 433, up 90 percent
from 228 in 2004. The company made significant in-roads in the
corporate, education, healthcare and government sectors, including
defense and aerospace, pharmaceutical, financial services and
universities. Existing customers are experiencing strong internal
demand for rich media content and are making additional purchases, an
indication of the growing market acceptance and demand for Mediasite and
rich media communications in general. Fiscal 2005's growing focus on
the enterprise was marked by new technology developments, expanded
service offerings and Microsoft certification (see below). Recent
customer additions include Sandia National Laboratories, University of
Texas-Austin, MetLife, Ross University, Merck, the Maryland House of
Delegates and the State of Wisconsin Senate.
* Developments in server technology. Sonic Foundry's recent technology
development efforts are in response to the broadening use of rich media
communications within the enterprise. The company is currently
introducing the EX Server to meet the need for a powerful, rich media
communications platform that reduces the time and resource costs
associated with managing, distributing and securing content across the
enterprise. The EX Server software offers a full suite of centralized
management tools allowing business, government and higher education
organizations to secure content access, monitor and report on system
usage and customize presenter and viewer experiences. The robust,
database-driven architecture of the EX Server software positions Sonic
Foundry's enterprise solution uniquely in the market by providing solid
integration and performance that is trusted by IT professionals and
system administrators.
* Recorder technology. Sonic Foundry introduced the Mediasite 440 Series,
an entirely new line of rich media recording devices designed to appeal
to various customers with both mobile and rack-mounted configurations.
The company's engineering effort continues to focus on designing
powerful recorder technology built to meet the rigorous demands for
state-of-the-art performance.
* Expanded service capabilities. In fiscal 2005, the company launched a
new managed services offering to help customers expedite rich media
deployment. The new offering enables organizations to jump start their
rich media communications efforts without having to wade through the
complexities associated with their IT or network infrastructure issues.
The company sees early traction with health and telemedicine Mediasite
customers, including Johns Hopkins Center for Clinical and Global Health
Education, Virtual OR and University of Wisconsin Department of
Medicine, who chose Sonic Foundry's hosting services as a hassle-free
solution to deploying rich media communications.
* Microsoft certification. Demonstrating enterprise compatibility, Sonic
Foundry earned certified status in Microsoft's Partner Program and a
Microsoft Competency in the area of ISV/Software Solutions. The Partner
Program recognizes the company's expertise, impact in the technology
marketplace and proven ability to meet customer needs, while the
ISV/Software Solutions Competency assures Sonic Foundry customers of
high quality and interoperability between the Mediasite solution and
Microsoft technologies.
* Mediasite.com search portal. To aggregate the thousands of
presentations created by Mediasite customers every day around the world,
the company today launched a new search portal, Mediasite.com, to link
information seekers with the experts providing knowledge. The Website
is one of the first to provide a true rich media information exchange.
Access to rich media content is one click away, providing a brand new
seamless viewing experience. A diversity of presentations and lectures
is available on a wide range of topics such as cancer treatment,
robotics, business startups, sociology, ethics and personal improvement.
Mediasite.com will help close the loop on the full content capture,
management, delivery and access process users seek for this new emerging
form of communications.
* Greater penetration in higher education. Sonic Foundry continued to
expand throughout the higher education market segment with
154 university and college customers worldwide, representing
approximately 36 percent of the company's customer base. Distance
learning, continuing education and professional development deployments
rapidly expanded through multi-unit sales and hosting services.
Mediasite is becoming the de facto standard for higher education
institutions, which choose Sonic Foundry's solution for the simplicity,
cost-effectiveness, Web communications capability and strong content
management tools. To further distribution in this market, Sonic Foundry
recently became a supplier to the Dell education channel with new
marketing and sales initiatives scheduled throughout 2006. In addition,
the company announced forthcoming integration with Blackboard, the
leading learning management system for educational institutions. These
and future advances illustrate Sonic Foundry's continued market
penetration and focus on enhancing the process of education through the
assistance of technology.
* Expansion into new global markets. Awareness of Mediasite continued to
grow globally through Sonic Foundry's international sales force and
increasing content generated by customers around the world. In fiscal
2005, Sonic Foundry fueled that awareness with market development
efforts in Europe and Pac-Asia. During the year, the company announced
the first internationalized version of its Mediasite line of rich media
systems. The company is using the same market development approach
which achieved early success in North America to gain a strong presence
in other worldwide markets. Build-out of the global sales force
continued with current field staff in New Zealand, Europe and Canada.
* High-profile and novel Mediasite applications on the rise. Fiscal 2005
was punctuated with multiple global, national and nontraditional
Mediasite Webcasts, such as Mediasite capturing images from NASA's Deep
Impact space probe collision with comet Tempel 1. National
personalities and leaders captured by Mediasite include the former and
current Chairmen and CEOs of General Electric Jack Welch and Jeffrey
Immelt, Michael Dell, Tom Ridge, Tommy Thompson, Ruth Bader Ginsburg,
John Kerry and Scott McNealy, CEO of Sun Microsystems.
"As an early stage, high growth company, we've succeeded in establishing our vision for a new market and one which we feel will be highly lucrative for years to come," said Rimas Buinevicius, chairman and CEO of Sonic Foundry. "The evangelism and enthusiasm of past years is now paying off and is starting to show the results we've predicted. Our greatest accomplishment is seen through the Mediasite customers who are changing the face of education, business, government and health through the use of rich media. They are improving technical communication processes, public service information, business planning and health care. Moving forward, we'll continue to respond to market demand for new product enhancements and service offerings with cutting edge technology that empowers people to communicate in a new, powerful way."
Sonic Foundry will host a Webcast today to discuss its 2005 fiscal year results at 10:00 a.m. CT/11:00 a.m. ET. It will Mediasite the presentation for both live and on-demand viewing. To access the presentation, go to www.sonicfoundry.com. An archive of the Webcast will be available for 30 days.