| SCO's 2Q Results Press Release and 8K |
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Tuesday, June 05 2007 @ 06:15 PM EDT
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Here's the press release on SCO's 2Q results as filed with the SEC as an attachment to SCO's 8K. Bleak as usual, with lots of upbeat talk about the future, as usual, at the conference call. No questions at all at the conference call, I'm told. What is there to say? The press release highlights their "current and beta" mobile products: At the recent CTIA Wireless Show, the Company exhibited many of its current and beta mobile technologies, including a soon to be released mobile technology that enables users to manage their life on the go. The Company’s latest release of Shout Postcard received favorable press coverage and product reviews during the CTIA Wireless Show. Shout Postcard is the Company’s new mobile technology for sharing life’s moments on the go with a personalized, multimedia postcard. Shout Postcard creates a rich, mobile experience by combining pictures, audio and text into a unique postcard that users can share through e-mail or other smart phones. Now what if it were true that Santa Cruz of old is now SCO Group? Let's just imagine it true for a moment. If it were, then this, ladies and gentlemen, is what the old Santa Cruz has become.
Not one thin dime of revenue this quarter from SCOsource to offset the costs of it.
Here's the press release announcing financial results for SCO's second quarter ended April 30, 2007:
*******************************
EXHIBIT 99.1
FOR IMMEDIATE RELEASE
Contact:
Craig Bushman
The SCO Group, Inc.
[email, telephone]
www.sco.com
The SCO Group Announces Second Quarter 2007 Results
LINDON, Utah — June 5, 2007 — The SCO Group, Inc. (Nasdaq: SCOX), a leading provider of UNIX®
software technology and mobile services, today reported results for its second quarter ended April
30, 2007.
Revenue for the second quarter of fiscal year 2007 was $6,014,000, down from $7,126,000 for the
comparable quarter of the prior year. The net loss for the second quarter of fiscal year 2007 was
$(1,143,000), or $(0.05) per diluted common share, an improvement over the net loss of
$(4,694,000), or $(0.22) per diluted common share, for the comparable quarter of the prior year.
Revenue for the first two quarters of fiscal year 2007 was $12,029,000, down from $14,469,000 for
the first two quarters of the prior fiscal year and the net loss for the first two quarters of
fiscal year 2007 was $(2,167,000), or $(0.10) per diluted common share, an improvement over the net
loss of $(9,275,000), or $(0.45) per diluted common share for the first two quarters of the prior
fiscal year. The decrease in revenue was primarily attributable to continued competitive pressures
on the Company’s UNIX products and services and the improvement in net loss was primarily
attributable to reduced legal costs and operating expenses.
“Even though competition continues to impact our revenue, we are pleased that our legal costs and
operating expenses are lower than the comparable prior periods which improved our financial
results,” said Darl McBride, president and CEO. “We are
committed to our strategy of serving our UNIX customers, developing
innovative new mobile technologies and protecting
our valuable intellectual property.”
Legal and related costs incurred in connection with the Company’s litigation were $1,066,000 for
the second quarter of fiscal year 2007, which was down significantly from costs of $3,762,000 for
the comparable quarter of the prior year. Because of the unique and unpredictable nature of the
Company’s litigation, the occurrence and timing of litigation-related costs is difficult to
predict, and will be difficult to predict in the future. While the Company expects to continue to
incur legal costs related to its ongoing litigation during the 2007 fiscal year, the Company’s
expectation is that fiscal 2007 costs will be less than they were for the 2006 fiscal year.
Cash and cash equivalents, available-for-sale marketable securities and restricted cash to be used
for certain legal expenditures totaled $11,181,000 as of April 30, 2007, compared to $12,664,000 as
of October 31, 2006.
The Company’s Business
During the second quarter of fiscal year 2007, the Company worked closely with customers and
partners to offer new solutions to the marketplace. The Company announced that it had partnered
with April System Design and Alpha Micro to help customers extend the life of their UNIX
applications. Through this partnership, customers can convert their green screen UNIX applications
to a modern new graphical interface without the need to rewrite applications or make large
investments in software development. This saves customers valuable time and money by allowing them
to stay on their familiar and reliable SCO UNIX platform while continuing to use their existing
applications.
The Company recently announced a new release of HipCheck, a unique mobile technology designed to
remotely control and manage UNIX and Windows server and PC systems. The new version of HipCheck
extends the product’s capabilities in terms of feature sets and the number of mobile handheld
devices that are supported.
At the recent CTIA Wireless Show, the Company exhibited many of its current and beta mobile
technologies, including a soon to be released mobile technology that enables users to manage their
life on the go. The Company’s latest release of Shout Postcard received favorable press coverage
and product reviews during the CTIA Wireless Show. Shout Postcard is the Company’s new mobile
technology for sharing life’s moments on the go with a personalized, multimedia postcard. Shout
Postcard creates a rich, mobile experience by combining pictures, audio and text into a unique
postcard that users can share through e-mail or other smart phones. A free download and more
information on Shout Postcard may be obtained by visiting www.shoutpostcard.com.
Conference Call
As previously announced, The SCO Group will host a conference call at 5:00 p.m. EST today, June 5,
2007, to discuss the second quarter 2007 results. To participate in the teleconference, please call
toll free 1-800-952-4629 or use the toll number 1-212-231-2901; confirmation code: 21340130,
approximately ten minutes prior to the time stated above. A listen-only Webcast of the call will be
broadcast live with a replay available the following day. The Webcast and replay may be accessed
from http://ir.sco.com/events.cfm.
Forward-Looking Statements
The statements contained in this press release regarding (i) our commitment to our UNIX business,
moving forward with our mobile services and defending our intellectual property rights, (ii) our
expectation that our legal costs will be less in fiscal 2007 than in
fiscal 2006, and (iii) other statements that are not historical facts are forward-looking
statements and are made under the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. These statements are based on management’s current expectations and are
subject to risks and uncertainties. We wish to advise readers that a number of important factors
could cause actual results to differ materially from historical results or those anticipated in
such forward-looking statements. These factors include, but are not limited to, continued
competitive pressure on the Company’s operating system products, which could impact the Company’s
results of operations, adverse developments in and increased or unforeseen legal costs related to
the Company’s litigation, the inability to devote sufficient resources to the development and
marketing of the Company’s products, including the Me Inc. mobile services and development
platform, and the possibility that companies with whom the Company has formed partnerships will
decide to terminate, or reduce the resources devoted to, their partnership with the Company. These
and other factors that could cause actual results to differ materially from those anticipated are
discussed in more detail in the Company’s periodic and current filings with the Securities and
Exchange Commission, including the Company’s Form 10-K for the fiscal year ended October 31, 2006
and Form 10-Q for the fiscal quarter ended January 31, 2007. These forward-looking statements speak
only as of the date on which such statements are made, and the Company undertakes no obligation to
update such statements to reflect events or circumstances arising after such date.
About The SCO Group
The SCO Group (NASDAQ: SCOX) is a leading provider of UNIX software technology and mobile
services, offering SCO OpenServer for small to medium business, UnixWare for enterprise
applications, and Me Inc. for mobile services. SCO’s highly innovative and reliable solutions help
millions of customers grow their businesses everyday, from SCO OpenServer on main street to
UnixWare on Wall Street, and beyond. SCO owns the core UNIX operating system, originally developed
by AT&T/Bell Labs and is the exclusive licensor to UNIX-based system software providers.
Headquartered in Lindon, Utah, SCO has a worldwide network of thousands of resellers and
developers. SCO Global Services provides reliable localized support and services to partners and
customers. For more information on SCO products and services, visit
http://www.sco.com.
SCO, SCO OpenServer, Me Inc. and the associated SCO logo are trademarks or registered
trademarks of The SCO Group, Inc. in the U.S. and other countries. UNIX and UnixWare are registered
trademarks of The Open Group. All other brand or product names are or may be trademarks of, and are
used to identify products or services of, their respective owners.
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| The SCO Group Announces Second Quarter 2007 Results
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Page 4 |
Condensed Consolidated Balance Sheet Data
(unaudited, in thousands)
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April 30, |
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October 31, |
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2007 |
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2006 |
Assets: |
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Cash and cash equivalents |
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$ |
7,787 |
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$ |
5,369 |
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Restricted cash |
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5,389 |
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8,024 |
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Available-for-sale marketable securities |
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— |
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2,249 |
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Accounts receivable, net |
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4,320 |
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5,123 |
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Other |
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1,402 |
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1,514 |
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Total current assets |
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18,898 |
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22,279 |
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Property and equipment, net |
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454 |
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608 |
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Other |
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495 |
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522 |
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Total assets |
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$ |
19,847 |
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$ |
23,409 |
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Liabilities: |
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Accounts payable |
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$ |
1,867 |
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$ |
2,338 |
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Accrued payroll and other expenses |
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4,363 |
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5,566 |
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Deferred revenue |
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3,120 |
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2,994 |
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Other |
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3,115 |
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4,237 |
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Total current liabilities |
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12,465 |
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15,135 |
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Long-term liabilities |
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189 |
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192 |
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Stockholders’ equity |
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7,193 |
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8,082 |
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Total liabilities and stockholders’ equity |
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$ |
19,847 |
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$ |
23,409 |
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| The SCO Group Announces Second Quarter 2007 Results
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Page 5 |
Condensed Consolidated Statement of Operations Data
(unaudited, in thousands, except per share data)
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Three Months Ended |
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Six Months Ended |
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April 30, |
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April 30, |
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2007 |
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2006 |
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2007 |
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2006 |
Products revenue |
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$ |
4,895 |
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$ |
5,703 |
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$ |
9,761 |
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$ |
11,703 |
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SCOsource licensing revenue |
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— |
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34 |
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23 |
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64 |
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Services revenue |
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1,119 |
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1,389 |
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2,245 |
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2,702 |
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Total revenue |
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6,014 |
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7,126 |
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12,029 |
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14,469 |
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Cost of products revenue |
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335 |
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497 |
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712 |
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1,081 |
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Cost of SCOsource licensing revenue |
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1,066 |
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3,762 |
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1,720 |
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7,772 |
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Cost of services revenue |
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546 |
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709 |
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1,105 |
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1,346 |
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Total cost of revenue |
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1,947 |
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4,968 |
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3,537 |
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10,199 |
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Gross margin |
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4,067 |
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2,158 |
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8,492 |
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4,270 |
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Operating expenses: |
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Sales and marketing |
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2,393 |
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2,857 |
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4,833 |
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5,545 |
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Research and development |
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1,554 |
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1,886 |
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3,313 |
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3,757 |
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General and administrative |
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1,351 |
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1,718 |
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2,674 |
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3,310 |
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Amortization of intangibles |
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— |
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593 |
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— |
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1,185 |
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Total operating expenses |
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5,298 |
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7,054 |
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10,820 |
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13,797 |
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Loss from operations |
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(1,231 |
) |
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(4,896 |
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(2,328 |
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(9,527 |
) |
Equity in income (loss) of affiliate |
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64 |
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— |
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106 |
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(8 |
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Other income, net |
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105 |
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316 |
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248 |
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461 |
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Loss before provision for income taxes |
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(1,062 |
) |
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(4,580 |
) |
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(1,974 |
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(9,074 |
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Provision for income taxes |
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(81 |
) |
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(114 |
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(193 |
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(201 |
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Net loss |
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$ |
(1,143 |
) |
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$ |
(4,694 |
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$ |
(2,167 |
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$ |
(9,275 |
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Basic and diluted net loss per common share |
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$ |
(0.05 |
) |
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$ |
(0.22 |
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$ |
(0.10 |
) |
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$ |
(0.45 |
) |
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Weighted average basic and diluted common
shares outstanding |
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21,233 |
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20,994 |
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21,209 |
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20,520 |
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| Authored by: Just_Bri_Thanks on Tuesday, June 05 2007 @ 06:26 PM EDT |
And please put the nature of the correction in the title of the comment!
---
Bri. Just Bri. Thank you.
(With a long i sound.)
Without qualification, certification,
exception, or (hopefully) bias.[ Reply to This | # ]
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| Authored by: Just_Bri_Thanks on Tuesday, June 05 2007 @ 06:28 PM EDT |
And please format hyperlinks by using the allowed HTML found in red at the
bottom of the comment edit box, and by formatting your post as HTML (The default
is "Plain Old Text".)
---
Bri. Just Bri. Thank you.
(With a long i sound.)
Without qualification, certification,
exception, or (hopefully) bias.[ Reply to This | # ]
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| Authored by: tiger99 on Tuesday, June 05 2007 @ 06:34 PM EDT |
| No questions at all, not even from the MOGster! I guess that means that there is
no interest whatsoever in SCO....... :-) [ Reply to This | # ]
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| Authored by: Anonymous on Tuesday, June 05 2007 @ 06:46 PM EDT |
"No questions at all at the conference call, I'm told."
These so-called conference calls should be renamed. Dear SCO marketing
department (if still existing at all), I'd propose the name
"cricket_chirp.wav Festival". Sincerely yours...[ Reply to This | # ]
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| Authored by: rocky on Tuesday, June 05 2007 @ 06:53 PM EDT |
I've often wondered, how do they get away with saying:
"SCO...is the exclusive licensor to UNIX-based system software
providers."
Isn't Sun an obvious example of how that's a total lie from SCOX? SCOX is not a
licensor of UNIX to Sun Solaris.
---
"I just *know* there's more to this than even Novell knows about. They didn't
buy what they thought they bought." -cybervegan[ Reply to This | # ]
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| Authored by: Anonymous on Tuesday, June 05 2007 @ 06:55 PM EDT |
They keep losing money but they never seem to run out. Clearly they will last
long enough for summary judgement, but can they make it to trial?[ Reply to This | # ]
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| Authored by: Felix_the_Mac on Tuesday, June 05 2007 @ 06:57 PM EDT |
| . [ Reply to This | # ]
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| Authored by: Anonymous on Tuesday, June 05 2007 @ 07:24 PM EDT |
Vultus was bought by SCO so some of SCO's hyper-inflated stock value could be
moved to Canopy afaict. Also afaict, there is no mention of anything Vultus
related in this 8k.
Have they dropped any pretense that Vultus was a worthwhile purchase? When was
the last time they mentioned any Vultus related product in an SEC filing?
It seems to me that they paid way more than they should have for an asset that
they should have known was worthless. In fact the deal seems fraudulent. It
seems to me that anyone who owned stock at the time of the transaction should be
able to sue SCO for harming the value of the stock.
Why hasn't anyone gone after them? What am I missing?
[ Reply to This | # ]
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| Authored by: Anonymous on Tuesday, June 05 2007 @ 07:42 PM EDT |
SCO always proudly announces itself as "the owner of UNIX" and acts as
thier multi-billion dollar assets are valid and impressive.
But their actual business seems to be dominated by tiny little .com toys like
"email postcards". Shouldn't they be talking about how they're
releasing new UNIX versions, how they've certified UNIX on new hardware
platforms, how they've created new server software to help Sun or Windows
businesses to transport their businesses to UNIX? Nope, you don't hear that,
you hear about postcards.
Actions show everything.[ Reply to This | # ]
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| Authored by: Anonymous on Tuesday, June 05 2007 @ 08:08 PM EDT |
It looks like SCOX doesn't have the decency to just die and relieve us of its
presence. With $7M in net cash and only $1.1M loss this quarter, it doesn't look
like SCOX is going to disappear any time soon. It appears that SCOX was able to
narrow its losses through massive layoffs, so it may well last through the
trial(s), if any.[ Reply to This | # ]
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| Authored by: Anonymous on Tuesday, June 05 2007 @ 08:59 PM EDT |
jeez, love the pump and dump!
keep it coming guys![ Reply to This | # ]
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| Authored by: valdis on Tuesday, June 05 2007 @ 09:39 PM EDT |
"The net loss for the second quarter of fiscal year 2007 was
$(1,143,000)"
"Legal and related costs incurred in connection with the Company’s
litigation were $1,066,000 for the second quarter of fiscal year 2007"
In other words, if they hadn't blown a million bucks on lawsuits, they'd be just
about breaking even.
[ Reply to This | # ]
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| Authored by: hAckz0r on Tuesday, June 05 2007 @ 10:19 PM EDT |
Daryl: Any questions from our stock holders out there?
<click>
One...Two...Three...Four...
Daryl: <click>Ok, see
you all next quarter! <click>
Daryl: Oops! Was that mute button on
again?
Seriously, anyone with a clue that cares already took their losses
and ran. It's likely that the only ones left are the ones in the board room who
hope not to go to jail when its all over. Some certain people might think that
by holding onto the company stock a jury might think that they actually believed
they had a case to file in the first place, and not just a grand extortion plan.
Of course those people would be wrong. No jurist in their right mind would think
that.
---
DRM - As a "solution", it solves the wrong problem; As a
technology its logically infeasible. [ Reply to This | # ]
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- No comments - Authored by: Anonymous on Tuesday, June 05 2007 @ 10:46 PM EDT
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| Authored by: ChefBork on Tuesday, June 05 2007 @ 10:39 PM EDT |
At the recent CTIA Wireless Show, the Company exhibited many of its
current and beta mobile technologies, including a soon to be released mobile
technology that enables users to manage their life on the
go....
How long are they going to keep saying "soon" and yet
never sell anything?
Does anyone remember when 'Go' (name?) was first
mentioned in a conference call or SEC document? Wasn't it over a year ago
now?
---
If two heads are better than one, then why are liars
two-faced and being of two minds indecisive? [ Reply to This | # ]
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| Authored by: _Arthur on Tuesday, June 05 2007 @ 10:42 PM EDT |
SCO has been selling Me Inc, HipCheck and Shout!Postcard for more than a year,
and their financials don't show any revenue from those sales, if any.
A SCO shareholder would be unable to evaluate the success of SCO Mobile
Division, unless he takes Darl's bluster at face value.[ Reply to This | # ]
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| Authored by: argee on Wednesday, June 06 2007 @ 12:00 AM EDT |
OK, let me see if I have this right. Rather than sending
a plain text email message on your cell phone, you get to
send the same message somehow wrapped in a graphical
postcard.
Takes longer to download, you have to maneuver the message
around the picture (or maybe it shows up before or after
the picture so it is superflous) and costs a *lot* more in
transmission costs.
This is not rich, mobile experience. It is a mobile
experience for the rich.
---
--
argee[ Reply to This | # ]
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| Authored by: Anonymous on Wednesday, June 06 2007 @ 12:55 AM EDT |
Not really, I know. But for me, it increasingly is. It's apparent to all and
sundry now that the endgame approaches, and SCOG is not going to survive it.
Now, don't get me wrong, I'm getting mucho freude from SCOG's schaden, and I'm
certainly not going to quit reading Groklaw, it just seems to me that we've now
crossed the point where the only legal analysis left is just documentation of
the endgame. On the other hand, now that oral arguments have begun, well the
actual courtroom coverage is our money shot for following this all the way
through, isn't it?
Now Groklaw does have other interests besides SCOG's immolation, and some of
them interest me more than others. Frex, I fully expect Groklaw to be *the*
place to turn for legal analysis of GPLv3.
So we're not going anywhere, me, you, PJ, mathfox, Groklaw...it just seems to me
that we're at a sea change here, and I wondered if I was alone in that thought.
bkd[ Reply to This | # ]
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| Authored by: belzecue on Wednesday, June 06 2007 @ 01:12 AM EDT |
Ransom Love: Oh, one last thing before I hand over to you...
Darl McBride: Yuh-huh?
Ransom Love: See that box labeled 'UNIX'?
Darl McBride: Yeah?
Ransom Love: We own that box. But do not EVER open it.
Darl McBride: So we own the box and we own what's IN the box?
Ransom Love: All I can tell you is, we own the box. That's all you need to know.
So long as you NEVER EVER open the box, things will be just fine. Do you
understand?
Darl McBride: Sure. We own the UNIX box. Don't ever open the UNIX box.
Ransom Love: Exactly. See ya.
[Ransom leaves...]
Darl McBride: All righty, let's see what's in the box...
[ Reply to This | # ]
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| Authored by: macrorodent on Wednesday, June 06 2007 @ 04:38 AM EDT |
| From the PR: Shout Postcard creates a rich, mobile experience by combining
pictures, audio and text into a unique postcard that users can share through
e-mail or other smart phones.
And this seems to be their main hope?
Pathetic. I don't know about how it is in America, but at least here in the Old
World, every GSM and 3G mobile phone (except some basic entry level handsets)
have for years supported multimedia messages (MMS) as a built-in feature. These
can include, audio, video, text etc.
[ Reply to This | # ]
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| Authored by: Anonymous on Wednesday, June 06 2007 @ 05:32 AM EDT |
I think the most honest (and funniest) part of this release has to when
detailing their legal costs they mention 'the unique and unpredictable nature of
the Company’s litigation'.
It sure is 'unique' (and hopefully we will never see anything like it again!).
And as for unpredictable, who could have guessed how ridiculous SCO's lawyers
would get.[ Reply to This | # ]
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| Authored by: blacklight on Wednesday, June 06 2007 @ 08:04 AM EDT |
SCOG's litigation strategy is highly successful, and SCOG's latest financials
prove it :) I am glad that SCOG has enough cash, cash equivalents and
receivables ($16 mils US) to cover the $10 mils US that Novell wants to claim.
Now is the best time for Novell to get seizure fever and have SCOG put the $10
mils US in escrow :)
---
Know your enemies well, because that's the only way you are going to defeat
them. And know your friends even better, just in case they become your enemies.[ Reply to This | # ]
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