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WebEx announces first quarter 2004 results

  • 13 May, 2004 16:34

<p>Melbourne, 13th May, 2004 - WebEx Communications, Inc. recently announced financial results for its first quarter ended March 31, 2004.</p>
<p>For the first quarter of 2004, revenue was US$56.3 million, a 35 per cent increase compared to the first quarter of 2003. Net income calculated in accordance with generally accepted accounting principles, or GAAP, was US$10 million. Earnings per diluted share, or EPS, for the first quarter of 2004 were US$0.22, compared to EPS of US$0.15 for the first quarter of 2003. The increase in EPS was 100 per cent compared to EPS calculated not in accordance with GAAP, or non-GAAP, of US$0.11 reported by WebEx for the first quarter of 2003. The 2003 non-GAAP EPS assumed a 40 per cent tax rate and excluded equity based compensation expense. With the increase in its effective tax rate starting in the first quarter of 2004, WebEx is discontinuing reporting non-GAAP EPS.</p>
<p>During the first quarter of 2004, cash and short-term investments increased to US$143 million, up US$9 million from the fourth quarter of 2003. Cash flow from operations of approximately US$18.8 million was offset by capital expenditures of US$19.7 million, principally the purchase of a US$16 million switching center. WebEx received US$9.8 million in cash from stock issuances under WebEx’s employee stock plans.</p>
<p>Net accounts receivable at March 31, 2004 were US$22.9 million, up from US$21.4 million at December 31, 2003. Sales reserves increased by US$0.1 million during the quarter to US$4.7 million. Allowance for doubtful accounts decreased by US$0.6 million during the quarter to US$1.6 million. Sales reserves and allowance for doubtful accounts are adjusted each quarter based on WebEx’s historical experience over several quarters with collections, write-offs and recoveries.</p>
<p>"This quarter we continued to see the benefits of ongoing focus on operational excellence and made good progress in new customer acquisitions and increased penetration of our services within existing customers," said Subrah Iyar, chairman and chief executive officer of WebEx.</p>
The following contains forward-looking guidance regarding WebEx’s financial outlook.</p>
<p>The following statements are based on current expectations.</p>
<p>For fiscal year 2004, WebEx reiterates revenue in the range of US$235 to US$245 million. For fiscal year 2004, GAAP EPS is anticipated to be in the range of US$0.80 to US$0.90, an increase from earlier guidance in the range of US$0.75 to US$0.85.</p>
<p>For the second quarter of 2004, WebEx anticipates revenue in the range of US$59 to US$61 million. GAAP EPS is anticipated to be in the range of US$0.20 to US$0.22 for the second quarter of 2004.</p>
<p>Non-GAAP Financial Measures<br/>
This press release includes a financial measure for earnings per share for the first quarter of 2003 that was not calculated in accordance with generally accepted accounting principles (GAAP). This financial measure differs from GAAP in that it assumes a 40 per cent tax rate and excludes equity based compensation expense. WebEx no longer provides non-GAAP financial measures for the current period, but believes that providing this non-GAAP financial measure for the prior period is still useful to investors because it provides a basis for comparison of WebEx’s financial condition and results of operations between quarters, which comparison is not influenced by changes in its effective tax rate. Since WebEx has historically reported non-GAAP results to the investment community, WebEx also believes the inclusion of non-GAAP measurements for prior periods provides consistency in its financial reporting. The presentation of this additional information is not meant to be considered in isolation or as a substitute for earnings per share calculated in accordance with GAAP. A reconciliation of these GAAP and non-GAAP financial measures is included in the attached tables.</p>
<p>About WebEx Communications, Inc. <br/>
WebEx Communications, Inc. is the world’s leading provider of web communications services. WebEx is used across the enterprise in sales, support, training, marketing, engineering and product design. WebEx meetings simulate the spontaneity and interactivity of face-to-face meetings by allowing users to share presentations, applications, documents and desktop, with full-motion video and integrated telephony. WebEx provides carrier-class services using its MediaTone communications platform deployed over the WebEx MediaTone Network, a high-speed global network specifically designed for real-time web communications. With its unique information-switching technology, multimedia capabilities and standards-based APIs, MediaTone is the dial tone for Web communications. WebEx Communications is based in San Jose, California and has regional headquarters in Europe and Asia. Please call toll free (877) 509-3239 or visit for more information.</p>
<p>This press release contains forward looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements may be identified by use of the terms anticipates, believes, continue, could, estimates, expects, intends, may, plans, potential, predicts, should or will, or the negative of those terms or similar expressions. These forward-looking statements are subject to significant risks and uncertainties. Actual results may differ materially from those described in such statements as a result of these risks and uncertainties. In particular, these forward looking statements include, but are not limited to, statements regarding guidance for the second quarter of 2004 and fiscal year 2004 on anticipated revenue and earnings per share. Factors which could contribute to risks and uncertainties include, but are not limited to the failure of WebEx to meet financial expectations, decrease in demand for WebEx services, the failure of WebEx to meet projections in domestic and international direct sales activity, channel sales, customer retention and expense control, failures and interruptions in the software and systems underlying WebEx’s services, the effects of competitive offerings, and the impact of general economic conditions. A fuller discussion of the risks and uncertainties that could affect WebEx Communications, Inc. are more fully set forth in WebEx Communications, Inc.’s filings with the Securities and Exchange Commission, including WebEx’s Annual Report on Form 10-K filed on March 12, 2004. WebEx Communications, Inc. assumes no obligation to update forward-looking information contained in this press release.</p>

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