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Red Hat Says Company Reached Break Even Per Share in Q4Mar 22, 2001, 21:44 (12 Talkback[s])RESEARCH TRIANGLE PARK, N.C.--March 22, 2001-- Red Hat, Inc., the leader in in developing, deploying and managing open source solutions, today reported revenue of $27 million for the fourth quarter ended February 28, 2001, an increase of 106% versus the $13.1 million reported for the fourth quarter of fiscal 2000 and an increase of 20% over the third quarter of fiscal 2001. The company reported an adjusted net loss of $600,000, or break even per share, for the fourth quarter of fiscal 2001, compared to an adjusted net loss of $5.6 million, or $0.04 per share, for the fourth quarter of fiscal 2000. On a reported basis, the net loss was $24.2 million, or $0.14 per share, compared with a net loss of $24.6 million, or $0.17 per share in fiscal 2000. The company also completed its fiscal year 2001, with revenues of $84 million, compared to $42 million in fiscal 2000, a 100% increase. The adjusted net loss for fiscal 2001 was $5.9 million or $0.03 per share, compared to $19 million or $0.19 per share for fiscal 2000. ``Red Hat expanded its sources of revenue by introducing strategic solutions to our global customers, which contributed to our strong operating results,'' commented Matthew Szulik, President and CEO of Red Hat. ``Our management team has continued to accomplish the operational and financial goals stated a year ago.'' Highlights for the fourth quarter include: CUSTOMER WINS / MAJOR DEALS
ACQUISITIONS
MANAGEMENT
About Red Hat, Inc. Red Hat is the leader in developing, deploying and managing solutions built on the benefits of an open source platform. These solutions include an open source product platform for devices to mainframes, a complete end to end set of Professional Services, and the Red Hat Network as the Internet-based backbone for deployment and management of the products and services. Red Hat's open source platform includes the award-winning Red Hat Linux operating system platform, the Interchange e-Commerce platform, Stronghold Secure Web Server, Credit Card Verification software, High Availability Server, GNU-based developer toolkit for embedded development, and embedded run-time Linux, eCOS, and RedBoot solutions. Red Hat backs up their open source offerings with end-to-end services that include Red Hat Professional Consulting focused on multiplatfom infrastructure and engineering services, Red Hat Engineering services for software development and porting of the operating system and for embedded platforms and devices, Red Hat Enterprise support services for installation services and web and telephone support, and Red Hat Learning services for Linux certification (RHCE) and courses for Apache, Embedded systems, Advanced Developer, and e-Commerce. Red Hat Network provides Red Hat's unique managed services capability to deploy and manage open source products, services, support and management information on-line in real-time to more cost effectively and reliably maintain open source based solutions. FORWARD-LOOKING STATEMENTS Forward-looking statements in this press release are made
pursuant to the safe harbor provisions of Section 21E of the
Securities Exchange Act of 1934. Investors are cautioned that
statements in this press release that are not strictly historical
statements, including, without limitation, management's plans and
objectives for future operations, and management's assessment of
market factors, constitute forward-looking statements which involve
risks and uncertainties. These risks and uncertainties include,
without limitation, Red Hat's ability to effectively integrate the
operations of Planning Technologies; Red Hat's ability to retain
Planning Technologies' traditional customers; Planning
Technologies' inexperience in offering professional consulting
services to Linux customers; Red Hat's lack of experience in
managing a large, geographically dispersed, professional services
organization; reliance upon strategic relationships, management of
growth, the possibility of undetected software errors, the risks of
economic downturns generally, and in Red Hat's industry
specifically, the risks associated with competition and competitive
pricing pressures, the viability of the Internet, and other risks
detailed in Red Hat's filings with the Securities and Exchange
Commission, copies of which may be accessed through the SEC's Web
site at http://www.sec.gov Three months Three months Year Year ended ended ended ended Feb. 28, Feb. 29, Feb. 28, Feb. 28, 2001 (A) 2000 (B) 2001 (A) 2001 (C) Revenue Subscription 11,790,059 8,138,222 45,498,605 45,498,605 Services 15,230,187 4,969,881 57,152,952 38,451,417 Hardware resale 777,070 Total revenue 27,020,246 13,108,103 103,428,627 83,950,022 Costs of Revenue Subscription 3,581,566 4,152,541 14,660,496 14,660,496 Services 8,232,795 2,742,704 33,402,199 21,088,108 Hardware resale 645,813 Total cost of revenue 11,814,361 6,895,245 48,708,508 35,748,604 Gross Profit 15,205,885 6,212,858 54,720,119 48,201,418 Operating expense Sales and marketing 11,758,221 7,429,364 48,979,339 40,110,319 Research and development 3,778,340 3,463,466 15,713,563 15,713,563 General and administrative 4,870,463 3,114,266 21,423,768 19,165,699 Total operating expenses 20,407,024 14,007,096 86,116,670 74,989,581 Income (loss) from operations (5,201,139) (7,794,238) (31,396,551)(26,788,163) Other income (expense), net 4,674,383 2,296,445 21,032,085 21,102,726 Income (loss) before income taxes (526,756) (5,497,793) (10,364,466) (5,685,437) Provision for income taxes 77,143 53,344 266,857 266,857 Net income (loss) (603,899) (5,551,137) (10,631,323) (5,952,294) Net income (loss) per common share Basic 0.00 (0.04) (0.06) (0.03) Diluted 0.00 (0.04) (0.06) (0.03) Weighted average common shares outstanding Basic 168,155,576 145,694,264 164,659,004 165,043,563 Diluted 168,155,576 145,694,264 164,659,004 165,043,563 Consolidated Statements of Operations Three months Three months Year Year ended ended ended ended Feb. 28, Feb. 29, Feb. 28, Feb. 28, 2001 (A) 2000 (B) 2001 (A) 2001 (C) Revenue Subscription 11,790,059 8,138,222 45,498,605 45,498,605 Services 15,230,187 4,969,881 57,152,952 38,451,417 Hardware resale 777,070 Total revenue 27,020,246 13,108,103 103,428,627 83,950,022 Costs of Revenue Subscription 3,581,566 4,152,541 14,660,496 14,660,496 Services 8,232,795 2,742,704 33,402,199 21,088,108 Hardware resale 645,813 Total cost of revenue 11,814,361 6,895,245 48,708,508 35,748,604 Gross Profit 15,205,885 6,212,858 54,720,119 48,201,418 Operating expense Sales and marketing 11,758,221 7,429,364 48,979,339 40,110,319 Research and development 3,778,340 3,463,466 15,713,563 15,713,563 General and administrative 4,870,463 3,114,266 21,423,768 19,165,699 Amortization of goodwill and intangibles 16,187,333 3,069,068 49,804,415 43,892,394 Stock based compensation 5,122,659 3,385,216 17,060,010 17,133,396 Merger, acquisition and other 2,306,335 12,604,058 9,219,862 9,219,862 Total operating expenses 44,023,351 33,065,438 162,200,957 145,235,233 Income (loss) from operations (28,817,466)(26,852,580)(107,480,838) (97,033,815) Other income (expense), net 4,674,383 2,296,445 21,032,085 21,102,726 Income (loss) before income taxes (24,143,083)(24,556,135) (86,448,753) (75,931,089) Provision for income taxes 77,143 53,344 266,857 266,857 Net income (loss) (24,220,226)(24,609,479) (86,715,610) (76,197,946) Net income (loss) per common share Basic (0.14) (0.17) (0.53) (0.46) Diluted (0.14) (0.17) (0.53) (0.46) Weighted average common shares outstanding Basic 168,155,576 145,694,264 164,659,004 165,043,563 Diluted 168,155,576 145,694,264 164,659,004 165,043,563 (A) Represents the pooled results of operations of Red Hat and Planning Technologies, Inc. for the period indicated. (B) Represents the previously reported results of operations of Red Hat for the period indicated. (C) Represents the previously reported results of operations of Red Hat for the nine month period ended November 30, 2000 and the pooled results of operations of Red Hat and Planning Technologies, Inc. for the three month period ended February 28, 2001. RED HAT, INC. Consolidated Balance Sheets February 28, February 29, 2001 2000(A) Assets Current assets: Cash and cash equivalents 85,212,830 242,426,032 Investments in debt and equity securities 62,911,634 27,460,222 Accounts receivable, net 24,753,635 7,893,936 Subcontractor receivable 3,441,394 0 Inventory 739,960 488,977 Prepaid expenses and other current assets 2,171,721 1,874,973 Total current assets 179,231,174 280,144,140 Property and equipment, net 14,591,510 7,909,103 Goodwill and intangibles, net 143,719,901 58,267,419 Investments in debt and equity securities 154,556,684 72,354,212 Other assets, net 9,108,984 4,859,958 Total assets 501,208,253 423,534,832 Liabilities and stockholders' equity Current liabilities Accounts payable 9,681,174 10,774,546 Royalties payable 115,117 Accrued expenses 15,915,682 7,571,058 Deferred revenue 12,150,549 11,030,337 Short-term notes payable 2,750,000 Current portion of capital lease obligation 336,143 366,062 Total current liabilities 40,833,548 29,857,120 Capital lease obligations 135,090 230,516 Commitments and contingencies 0 0 Stockholders' equity: Preferred stock Common stock 16,849 15,334 Additional paid-in capital 639,669,483 477,781,234 Shareholder receivables 0 (66,899) Deferred compensation (36,051,412) (35,159,127) Accumulated other comprehensive income 193,462 (515,868) Accumulated deficit (143,588,767) (48,607,478) Total stockholders' equity 460,239,615 393,447,196 Total liabilities and stockholders' equity 501,208,253 423,534,832 (A) Represents the previously reported balance sheet of Red Hat as of February 29, 2000. Contact: Company Contact: Red Hat, Inc. Melissa London (919) 547-0012 melissa@redhat.com or Investor Contact: Red Hat, Inc. Gabriel Szulik Investor Relations Manager (919) 547-0012 gszulik@redhat.com |