Novell Reports Financial Results for First Fiscal Quarter 2005
Novell, Inc. (NASDAQ:NOVL) today announced financial results for its first fiscal quarter ended Jan. 31, 2005. For the quarter, Novell reported revenues of $290 million, compared to revenues of $267 million for the first fiscal quarter 2004. Net income available to common stockholders in the first fiscal quarter 2005 was $392 million, or $0.90 per diluted common share. This compared to net income available to common stockholders of $10 million, or $0.03 per diluted common share, for the first fiscal quarter 2004.
On a non-GAAP basis, adjusted net income available to common stockholders for the first fiscal quarter 2005 was $10 million, or $0.03 per diluted common share, which excludes a $448 million net gain on a previously announced legal settlement with Microsoft, $6 million of restructuring expense, a $2 million gain on a sale of property, $1 million of long-term investment impairments and the related adjustments for income taxes and the allocation of earnings to preferred stockholders. This compares to non-GAAP adjusted net income available to common stockholders for the first fiscal quarter 2004 of $11 million, or $0.03 per diluted common share, which excludes the effect of long-term investment impairments of $1 million. Full details on Novell’s reported results, including a reconciliation of the non-GAAP adjusted results, are included in the financial schedules that are a part of this release.
In the first fiscal quarter 2005, foreign currency exchange rates favorably impacted total revenue by approximately $10 million year-over-year. Foreign currency exchange rates favorably impacted net income by $2 million year-over-year.
During the first fiscal quarter 2005, Novell recognized revenue of $15 million associated with its SUSE® LINUX business, including $7 million of recognized revenue from subscriptions to SUSE LINUX Enterprise Server. Sales of subscriptions to SUSE LINUX Enterprise Server totaled 21,000 units in the quarter.
“Novell made steady progress on executing its strategy this quarter. We still have work ahead of us as we continue to reposition the company in our growth markets ,” said Jack Messman, Chairman and CEO of Novell. “Our solid balance sheet gives us increased financial flexibility to execute strategic initiatives in the future.”
On the balance sheet, cash and short-term investments were $1.7 billion at Jan. 31, 2005, compared with $1.2 billion at Oct. 31, 2004. Days sales outstanding (DSO) in accounts receivable was 59 days at the end of the first fiscal quarter 2005, down from 60 days in the year ago quarter. Deferred revenues were $343 million at the end of the first fiscal quarter 2005, up $49 million or 17% year over year. Cash flow from operations was $452 million for the first fiscal quarter 2005, up from $31 million a year ago, mainly due to the net $448 million Microsoft settlement payment.
A summary of Novell’s vision, mission and strategy can be accessed on the Novell® Web site at: www.novell.com/company/ir/qresults.
Conference call notification and Web access detail
A live Webcast of a Novell conference call to discuss the quarter will be broadcast at 5PM ET Feb. 22, 2005, from Novell's Investor Relations Web page: http://www.novell.com/company/ir/qresults/. The domestic conference call dial-in number is 888-323-5254, password “Novell”, and the international dial-in number is +1-773-756-4625, password “Novell”.
The call will be archived on the Web site approximately 15 minutes after its conclusion, and will be available for telephone playback through midnight, March 8. The domestic toll-free replay number is 888-562-2893, and the international replay number is +1-402-530-7604.
A copy of this press release is posted on Novell’s Web site at: http://www.novell.com/company/ir/qresults/.
Legal notice regarding forward looking statements
This press release includes statements that are not historical in nature and that may be characterized as “forward-looking statements,” including those related to future financial and operating results, benefits and synergies of the company’s brands and strategies, future opportunities and the growth of the market for open source solutions. You should be aware that Novell’s actual results could differ materially from those contained in the forward-looking statements, which are based on current expectations of Novell management and are subject to a number of risks and uncertainties, including, but not limited to, Novell’s ability to integrate acquired operations and employees, Novell’s success in executing its Linux strategies, Novell’s ability to deliver on its one Net vision of the Internet, Novell’s ability to take a competitive position in the Linux industry, business conditions and the general economy, market opportunities, potential new business strategies, competitive factors, sales and marketing execution, shifts in technologies or market demand and the other factors described in Novell’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on Jan. 13, 2005. Novell disclaims any intention or obligation to update any forward-looking statements as a result of developments occurring after the date of this press release.
Novell, Inc. (Nasdaq: NOVL) is a leading provider of infrastructure software and services to over 50,000 customers in 43 countries. With more than 20 years of experience in data center, workgroup and desktop solutions, Novell's 6,000 employees, 5,000 partners and support centers around the world are meeting customer requirements for identity-driven computing and Linux solutions. By providing enterprise-class software and support for commercial and open source software, Novell delivers increased operating flexibility and choice at a lower total cost of ownership. More information about Novell can be found at http://www.novell.com.
Novell, Nsure and Ximian are registered trademarks; exteNd and Nterprise are trademarks; and Ngage is a service mark of Novell, Inc. in the United States and other countries. SUSE is a registered trademark of SUSE LINUX AG, a Novell business. *All third-party trademarks are the property of their respective owners.
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