VCampus Online Tuition Revenues Up 6% Over Q2 2002
“VCampus continues to be an e-Learning industry leader. Our investments in sales and marketing this quarter, high customer satisfaction and our recent launch of VNexusTM, position the company for greater revenue growth in the coming year,” said Daniel Neal, President and Chief Executive Officer of VCampus. “Our technology enhancements, including recent SCORM conformance, support our commitment to superior service, functionality, flexibility and integration capability.”
“In addition to our technology advancements, we raised additional capital which provided additional ability to invest in the growth of our sales team,” said Christopher Nelson, Chief Financial Officer of VCampus. “Our management team’s continued focus on growth, particularly in the government, as well as careful cost containment, position us well to maintain our momentum in the e-Learning industry.”
Quarter Highlights:
— Online tuition revenues for Q3-2002 were $1,558,116, compared with $1,470,818 in Q2-2002, an increase of 6%.
— Total net revenues for Q3-2002 were $1,735,807, compared with $1,633,208 in Q2-2002, also a 6% increase.
— VCampus recorded a non-cash charge of $1.76 million for a dividend to preferred shareholders in the third quarter. $1.5 million of this dividend
(85%) was attributable to anti-dilution rights associated with the preferred stock Series F, F1 and F2, which were triggered by the issuance of Series G preferred stock in September 2002 at a conversion price below the conversion price of the Series F, F1 and F2 preferred stock.
— Excluding a non-recurring charge of $192,000 for a stranded lease, operating loss for Q3-2002 was $909,971. Although slightly below the same period of last year, this loss was 35% greater than Q2-2002. The increase in loss is primarily attributable to the Company’s decision to make further investments in sales and marketing to take advantage of the Company’s momentum, particularly in the government sector.
— VCampus announced the rollout of VNexus, a next generation platform making VCampus the first e-Learning company to launch a fully SOAP-compliant Learning Management platform with superior web services capabilities. Through VNexus, organizations can now take advantage of the cost effectiveness of an Application Service Provider while gaining a level of flexibility and customization previously attributed only to installed, behind-the-firewall solutions.
— VCampus continues to adhere to important industry standards. At the end of Q3-2002 the Company became SCORM 1.2 conformant, adding to its list of conforming standards, which includes Section 508, SOAP, AICC and W3C standards.
— The Company completed an expansion of its Data Center, providing enhanced service levels to customers.
— The Company renewed 5 customer contracts in the quarter, showing continued high levels of customer satisfaction with VCampus services.
— VCampus filled a key leadership position in the third quarter. Kathleen Hanafan was named the Company’s Senior Vice President, Sales and Marketing. Ms. Hanafan brings a wealth of e-Learning and other corporate sales experience to VCampus. Ms. Hanafan has added new sales representatives to the VCampus team, all with significant e-Learning experience, with a goal of increasing VCampus revenues and market share in the corporate sector.
— The Company completed a $1 million private equity placement through an offering of preferred stock and warrants. This placement allows the Company to continue its strong marketing program targeting the federal government, while enabling VCampus to also pursue new sales and marketing initiatives in the corporate sector.
— VCampus executed a reverse stock split during the third quarter, and thereby regained compliance with Nasdaq SmallCap’s $1.00 minimum bid price requirement for continued listing.
Looking Ahead:
— The Company expanded its corporate-focused sales force to continue towards its goal of increasing market share.
— VCampus continued its growth in the government sector with the addition of two customers in the third quarter of 2002, showing support of VCampus’ fully outsourced, content-neutral e-Learning solution. VCampus has focused significant sales and marketing efforts on the government sector, and anticipates continued penetration of this market.
— The Company has developed strong programs that are helping major universities and colleges compete for student enrollment, leading to increasing enrollment among existing higher education customers.
Total revenues for the third quarter of 2002 were $1,735,807 as compared with $1,678,833 for the same period last year, a 3.4% increase. Total revenues for Q3-2002 increased by 6.3% as compared to Q2-2002. Third quarter 2002 net loss to common shareholders was $2,794,858, or $1.83 per share, as compared to $1,272,999, or $0.89 per share, in the third quarter of 2001 and $1,806,500, or $1.23 per share, in the second quarter of 2002.
A conference call is scheduled for 11:00 a.m. Eastern Time on Thursday, October 31, 2002, to discuss the quarter. The dial-in number will be 877-329-7569. International callers may dial 908-228-5023.
About VCampus
VCampus® Corporation (Nasdaq: VCMP) is a leading provider of end-to-end e Learning solutions. The company develops, manages and hosts turnkey, web-based learning solutions for corporations, government agencies and higher education institutions. VCampus enables these organizations to offer complete global distance learning solutions to their customers, employees, distributors, suppliers and students. VCampus’ e-Learning solutions are designed to help clients deliver higher education programs to adult students; improve the performance of their distribution channels and suppliers; measure and develop their employees’ knowledge, skills and abilities; and increase their customers’ satisfaction and loyalty. VCampus distributes a courseware library of more than 5,200 web-based courses and has delivered more than 2.5 million courses to over 700,000 adult learners. VCampus Corporation is headquartered in Reston, VA. For more information, call 800-915-9298, or visit the VCampus website at www.vcampus.com. “VCampus” and “VNexus” is a registered trademark and trademark of VCampus Corporation respectively.
This press release contains forward-looking statements within the meaning of the federal Private Securities Litigation Reform Act of 1995. Statements contained herein that are not statements of historical fact are forward-looking. Without limiting the foregoing, references to future growth or expansion are forward-looking, and words such as “anticipates,” “believes,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “should,” “will,” and “would” and other forms of these words or similar words are intended to identify forward-looking information. You should read statements that contain these words carefully because they discuss our future expectations contain projections of our future results of operations or of our financial position or state other forward-looking information. There might be events in the future that we are not able to predict accurately or control, and any forward-looking statements are subject to risks and uncertainties that could cause our actual results to differ materially. These risks and uncertainties include: (1) our history of losses, projection of future losses and our need to raise additional capital; (2) market acceptance of our new and future products; (3) growing competition; and (4) our ability to maintain and manage our growth. For additional information regarding risk factors that could affect our future results, please refer to the discussions of “Risk Factors” in our Form 10-K for the year ended December 31, 2001, filed with the SEC on April 1, 2002, and other SEC filings.
To view the press release with earnings tables on our Web site please visit:
http://www.vcampus.com/corpweb/releases/20021030.cfm
Media Contact:
Lisa M. Sherwin Wulf
VCampus Corporation
(703) 893-7800 ext. 296
lsherwin@vcampus.com
Investor Contact:
Christopher Nelson
VCampus Corporation
(703) 893-7800 ext.214
cnelson@vcampus.com
