Esker returns to profitability for H2 2000

Intelligent Information Delivery (IID) products will drive Esker's growth in coming years

Lyon, March 12, 2001 -

(Million of euros)
6 month P&L
2000
2000
1999
H 2
H 1
Sales
27,38
27,72
14,57
12,80
EBIT
(3,73)
3,12
0,12
(3,86)
Interest income
0,29
0,68
0,10
0,19
Operating income / (loss)
(3,44)
3,80
0,22
(3,66)
Exceptional items
(1,07)
(0,58)
(0,48)
Taxes
(0,40)
(1,28)
(0,40)
Goodwill amortization
(0,24)
(0,24)
(0,14)
Net income / (loss)
(5,15)
2,27
(0,90)
(4,25)

Esker quickly returns to profitability for H2 2000

2000 was a year of transition for Esker. Stagnant IT markets worldwide combined with Host Access business starting to reach maturity have hurt Esker's results. Host Access products have indeed declined by 35% in 2000 compared to 1999. However, IID software sales have increased by 4% in 2000. Esker believes, with the launch in February 2001 of its new product PULSE (a multi-channel intelligent delivery solution for business information), that the IID market will provide significant growth for the company in coming years.

Consistent with Esker's previous announcements, the strong reorganization plan that the company carried out in summer 2000 has paid off and Esker has returned to operating profitability as early as H2 2000. Additional limited restructuring decisions implemented in the second half continue to improve the company's cost structure. In addition, treasury stocks owned by Esker have been written down to their market value as of December 31, 2000. The cost of these decisions is reflected in the exceptional section of the income statement. Finally, Esker has decided for conservatism to write down all deferred tax assets related to tax operating losses generated in the U.S. These tax credits remain however available to offset the company's future profits on this market.

2001 outlook

On March 6th 2001, Esker hosted a conference in Paris entitled "From Content Management to Information Delivery." Participants included the Gartner Group, La Poste (French national postal service), Hewitt Associates (largest employee benefit consulting firm in the US, an Esker customer and PULSE beta tester) and Credit Lyonnais Small Caps (a leading French financial institution). Participants have concluded that multi-channel information delivery systems would experience explosive growth at least through the year 2005. Support for new media and fast access to quality content via the desired channel have been identified as a clear market differentiator and a key success factors for this market. XML is considered a key enabling technology. Esker believes that PULSE clearly constitutes the most innovative and efficient offering to address customer needs. The successful launch of PULSE and the first reactions of customers, prospects and potential partners to its launch in February 2001, should lead Esker to significant growth in the years to come.

With 88% of its sales outside of France, including 52% in the Americas, Esker is one of the few French software companies to really succeed internationally. Esker will clearly benefit from this experience, from the highly skilled people it employs worldwide and from the quality of its distribution channels to make the launch of PULSE a real long-term success.

Esker has clearly chosen to preserve its capacity of investment in Research & Development, and to intensify its commercial and marketing activities in the year 2001 in order to deepen its competitive advantage with PULSE for the benefit of its customers, employees and shareholders.

About Esker
Esker software enables intelligent access to and delivery of core business information from any data source, in any format, to any recipient. Organizations use Esker software to streamline information exchange, open new channels of communication, and achieve business objectives with new levels of speed and efficiency. Esker extends the reach of information technologies and shortens the distance between people and information. The company's products include:

  • Corridor for Active Server and Corridor Wireless for legacy applications extension
  • Persona® for web-to-host connectivity
  • PulseTM for Intelligent Information Delivery
  • SmarTerm® for PC-based host access
  • Tun® Plus for PC-to-host, web-to-host, and multi-user Windows connectivity

The company was founded in 1985 and is traded on the French Stock Exchange (Le Nouveau Marché: 3581). In 1999, the company achieved sales of $29.4 million - a 44% increase over 1998. In September 2000, Esker finalized an agreement to acquire VSI, a California-based developer of fax server solutions. Esker's operations span North America, South America, Europe, and Asia/Pacific with about 300 employees and an installed base of two million licensed users worldwide. For more information, visit: http://www.esker.com.

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© 2001 Esker S.A. All Rights Reserved. Esker, Faxgate, General Document Recognition, GDR, Persona, Pulse, SmarTerm, and Tun and are trademarks or registered trademarks of Esker S.A. in the United States and/or other countries. Active Server is a trademark of Microsoft Corporation. All other trademarks mentioned are the property of their respective owners.