DigitalThink Announces Record Revenues for Fourth Quarter of Fiscal 2001
SAN FRANCISCO — DigitalThink, Inc. (Nasdaq:DTHK),
the leading provider of business-to-business e-learning solutions to Fortune
1000 companies, today announced record revenues for its fourth quarter and the
fiscal year ended March 31, 2001.
Revenues for the fourth quarter of fiscal 2001 were $12.8 million
compared with $4.3 million for the same period last year, an increase
of 198% and an increase of $2.1 million or 19% over the quarter ended
December 31, 2000. Reported net loss for the fourth quarter was $9.9
million or a net loss of $.28 per share compared to a net loss of $7.2
million in the quarter ended March 31, 2000. Excluding non-cash
charges totaling $5.0 million for amortization of goodwill,
amortization of warrant expense associated with performance warrants
issued to Electronic Data Systems Corporation and amortization of
stock-based compensation, the net loss for the quarter ended March 31,
2001 was $4.9 million or $.14 per share.
Revenues for the fiscal year ended March 31, 2001 were $38.7
million, up $27.8 million from the same period last year, representing
annualized growth of over 250%. Reported net loss for the 12 months
ended March 31, 2001 was $52.2 million, or a loss of $1.51 per share.
Excluding non-cash charges totaling $29.3 million for write-off of
in-process research and development, amortization of goodwill,
amortization of warrant expense associated with performance warrants
issues to Electronic Data Systems Corporation and amortization of
stock-based compensation, the net loss for the fiscal year ended March
31, 2001 was $22.9 million, or $.66 per share. As of March 31, 2001,
DigitalThink ended the fiscal year with cash balances of $68 million.
“Fiscal 2001 was a record year for DigitalThink,” said Pete
Goettner, chairman and CEO of DigitalThink. “DigitalThink is
demonstrating that e-learning is an indispensable tool for global
businesses focused on reducing costs, maximizing revenue
opportunities, accelerating time-to-market for new products and
services, and communicating with geographically dispersed customer
bases. As we begin fiscal 2002, the business climate is clearly
toughening. However, we believe that customers will continue to choose
DigitalThink e-learning solutions for the near-term value it brings to
their businesses.”
In addition to the record revenues in the fourth quarter recent
highlights at DigitalThink include:
- DigitalThink added 22 new customers, including Honeywell, Marsh
& McLennan, Palm, Revlon and Texas Utilities. DigitalThink also
expanded relationships with several key customers including Aspect
Communications, Charles Schwab, Cisco Systems, General Electric,
Hewlett Packard, Intuit and PeopleSoft.
- EDS, one of DigitalThink’s global strategic alliance partners,
closed its first large e-learning initiative based on the DigitalThink
platform. DigitalThink and EDS will work in partnership to develop
mission critical e-learning solutions for Avaya’s employees and
customers.
- DigitalThink and KPMG, another global strategic partner, have
signed an agreement with a major governmental agency in the United
Kingdom to move critical personnel training programs online.
- DigitalThink launched the Enterprise Gateway, E-Learning’s
first open protocol for integration with third party enterprise
software applications. Based on industry standards XML, SOAP and SSL
technologies, the Enterprise Gateway allows DigitalThink’s platform to
securely communicate and exchange data with CRM, ERP, LMS and
e-commerce enterprise applications. In conjunction with this rollout,
DigitalThink announced a range of new partners committed to
interoperability with the company via the Enterprise Gateway,
including Boniva Software, Click2Learn, Docent, ISOPIA, Oracle,
Teamscape, and THINQ.
- John Olmstead has joined DigitalThink to head up its sales
organization in the role of vice president for sales. John has a long
and impressive track record at UUNet and Compuserve Network Services
(now WorldCom), most recently as a vice president of global sales.
- DigitalThink is also pleased to announce it has agreed to
purchase the outstanding shares of TCT Technical Training Pvt. Ltd.,
of Kolkata (formerly Calcutta), India. TCT currently has more than 60
employees with extensive experience in e-learning web design and
production. The transaction must be approved by the Indian government
and is expected to close by the second quarter of fiscal 2002.
About DigitalThink
DigitalThink, Inc. (Nasdaq:DTHK)
is the leading provider of e-learning business solutions to Global 2000 companies.
DigitalThink is at work training employees, making sales channels more effective
and assuring customer loyalty at smart companies such as Sun Microsystems, EDS,
Deutsche Bank, GE Capital, KPMG Consulting, The Gallup Organization, Charles
Schwab & Company, Cisco Systems and Circuit City. For comprehensive information,
visit the DigitalThink Web site at www.digitalthink.com.
"Safe Harbor” Statement Under the Private Securities Litigation Reform
Act 1995:
The statements contained in this release that are not purely
historical are forward-looking statements within the meaning of
Section 21E of the Securities Exchange Act of 1934, including
statements regarding DigitalThink’s expectations, beliefs, hopes,
intentions or strategies regarding the future. Forward-looking
statements include statements regarding future sales, beliefs about
the applicability of DigitalThink’s solutions, sales to existing
customers, growth of future enrollments, successful integration of the
newly acquired Indian operations and the growth of the e-learning
market. All forward-looking statements included in this release are
based upon information available to DigitalThink as of the date
hereof, and DigitalThink assumes no obligation to update any such
forward-looking statement. Actual results could differ materially from
DigitalThink’s current expectations. Factors that could cause or
contribute to such differences include, but are not limited to, our
limited operating history, expected fluctuation of our quarterly
revenues, our ability to recognize revenues in accordance with our
expectations, successful hiring and retention of qualified staff, the
continued success of our alliance program, and other factors and risks
discussed in DigitalThink’s filings with the Securities and Exchange
Commission on June 26, 2000 and any other reports filed from time to
time pursuant to the Securities and Exchange Act of 1934.
DigitalThink Inc. Statements of Operations (in thousands, except per share data) (unaudited)
Quarter Ended Year to Date
March 31, March 31,
2001 2000 2001 2000
-------- -------- -------- --------
Revenues:
Delivered Learning
fees $ 6,801 $ 1,938 $ 17,978 $ 4,994
Learning Solution
services 6,048 2,389 20,680 5,821
-------- -------- -------- --------
Total revenues 12,849 4,327 38,658 10,815
Costs and expenses:
Cost of Delivered
Learning fees 1,646 954 5,510 2,409
Cost of Learning
Solution services 3,018 1,517 11,212 3,337
Content research
and development 1,085 1,307 6,092 4,082
Technology research
and development 3,436 1,322 11,791 3,687
Selling and marketing 6,863 4,378 23,105 11,596
General and
administrative 1,816 823 6,046 2,342
Depreciation 935 390 3,190 915
Write-off of
in-process research
and development -- -- 7,118 --
Amortization of
goodwill 1,201 -- 3,603 --
Amortization of
warrants 2,751 -- 13,131 --
Stock-based
compensation 1,044 1,567 5,431 3,663
-------- -------- -------- --------
Total costs and
expenses 23,795 12,258 96,229 32,031
-------- -------- -------- --------
Loss from operations (10,946) (7,931) (57,571) (21,216)
Interest and other
income 1,045 706 5,344 1,055
-------- -------- -------- --------
Net loss $ (9,901) $ (7,225) $(52,227) $(20,161)
======== ======== ======== ========
Pro forma basic &
diluted net loss per
common share (1) $ (0.28) $ (0.24) $ (1.51) $ (0.79)
======== ======== ======== ========
Shares used in pro
forma basic and
diluted net
loss per
common share 34,885 29,857 34,524 25,412
Supplemental data :
Adjusted loss
applicable to
common shareholders
excluding in process
research and
development,
amortization of
goodwill,
amortization of
warrants and
stock-based
compensation $ (4,905) $ (5,658) $(22,944) $(16,498)
Adjusted pro forma
basic & diluted net
loss per share (1) $ (0.14) $ (0.19) $ (0.66) $ (0.65)
Shares used in pro
forma basic and
diluted net
loss per
common share(1) 34,885 29,857 34,524 25,412
(1) Pro forma results exclude accretion related to preferred stock
in 2000 and assumes the conversion of preferred stock into an
equivalent number of shares of common stock at time of issuance.
DigitalThink Inc.
Balance Sheet
(in thousands)
(unaudited)
March 31, March 31,
2001 2000
ASSETS
Current assets:
Cash & equivalents &
marketable securities $ 67,872 $ 98,498
Accounts receivable 9,027 5,322
Other 4,118 792
-------- --------
Total current assets 81,017 104,612
-------- --------
Property & equipment, net 15,061 5,564
Goodwill and other
intangible assets 15,611 --
-------- --------
Total assets $111,689 $110,176
======== ========
LIABILITIES &
STOCKHOLDERS' EQUITY
Current liabilities:
Deferred revenue $ 11,548 $ 7,035
Other 10,997 5,261
-------- --------
Total liabilities 22,545 12,296
-------- --------
Long-term liabilities 17 --
Total stockholders'
equity 89,127 97,880
-------- --------
Total liabilities and
stockholders' equity $111,689 $110,176
======== ========
Contact Information:
DigitalThink
Mike Pope, 415/625-4316 (Investor/Finance)
investorrelations@digitalthink.com
or
NRW for DigitalThink
Faith Brewitt, 650/827-7098 (Press)
