<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE
SECURITIES EXCHANGE ACT OF 1934
For January 19, 2000
MADGE NETWORKS N.V.
(Translation of registrant's name into English)
Transpolis Schiphol Airport
Polaris Avenue 23
2132 JH Hoofddorp
The Netherlands
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports
under cover Form 20-F or Form 40-F
Form 20-F X Form 40-F
------ ------
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934
Yes No X
------ ------
If "Yes" is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b):
82- N.A.
-------
Page 1 of 15 Pages
Exhibit Index Appears on Page 2
<PAGE> 2
MADGE NETWORKS N.V.
On January 19, 2000, Madge Networks N.V. announced (1) its earnings for the
fourth quarter and full year ended December 31, 1999, (2) the completion of the
separate legal formation of Madge.connect and Madge.web, and (3) the filing of a
Form F-3 for the offering from time to time of common shares or debt securities
with a total value of $30 million. The press releases with respect to those
matters are attached as exhibits to this Form 6K and incorporated herein by
reference.
EXHIBIT INDEX
99.1 Press Release, dated January 19, 2000 with respect to filing
of Form F-3.
99.2 Press Release, dated January 19, 2000 with respect to separate
legal formation of Madge.connect and Madge.web.
99.3 Press Release, dated January 19, 2000 with respect to earnings
for the fourth quarter and full year ended December 31, 1999.
<PAGE> 3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this Report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Madge Networks N.V.
By: /s/ Robert H. Madge
-------------------
Robert H. Madge
Managing Director
Date: January 20, 2000
<PAGE> 1
EXHIBIT 99.1
MADGE NETWORKS N.V. [MADGE LOGO]
Transpolis Schiphol Airport
Polaris Avenue 23
2132 JH Hoofddorp
The Netherlands
Main: (+31) (0) 23 5685526
Fax: (+31) (0) 23 5685528
MADGE NETWORKS N.V. ANNOUNCES PLANS TO
RAISE UP TO $30 MILLION
Amsterdam, The Netherlands (January 19, 2000) -- Madge Networks N.V. (NASDAQ NM:
MADGF), a global network solutions provider, today announced that it has filed a
universal shelf registration statement on Form F-3 with the Securities and
Exchange Commission which will permit the Company to offer and sell, from time
to time, various types of securities including, but not limited to, common share
and debt securities, up to a total value of $30 million. The Company filed the
registration statement to gain flexibility in accessing the capital markets
primarily to fund the expansion of Madge.web. Any offers of securities pursuant
to the registration statement will be made only by means of a prospectus.
The registration statement relating to these securities has been filed with the
Securities and Exchange Commission but has not yet become effective. These
securities may not be sold nor may offers to buy be accepted prior to the time
the registration statement becomes effective. This press release shall not
constitute an offer to sell or the solicitation of an offer to buy nor shall
there be any sale of these securities in any State in which such offer,
solicitation or sale would be unlawful prior to registration or qualification
under the securities laws of any such State.
<PAGE> 2
ABOUT MADGE NETWORKS N.V.
Founded in 1986, Madge Networks N.V. (NASDAQ NM: MADGF) is a global managed
network services and product solutions provider specializing in mission-critical
enterprise needs. The company's goal is to optimize the implementation of
enterprises' voice, video and data networks with the ultimate aim of converging
all networking needs on Internet Protocol (IP) solutions. The company's main
business centers are at Wexham Springs, United Kingdom, New York City and
Eatontown, New Jersey. Madge Networks N.V., a company organized under the laws
of the Netherlands, is the parent company of Madge.web Holdings B.V. and
Madge.connect Holdings B.V. Information about Madge's complete range of products
and services can be accessed on the World Wide Web at www.madge.com
PRIVATE SECURITIES LITIGATION REFORM ACT STATEMENT
Investors should take note that certain statements in this press release are
forward-looking and may not give full weight to all of the potential risks
(e.g., ability to raise additional funds to fund the expansion of Madge.web,
changing technologies, competition, management of change, and changed resource
allocation resulting from these and other factors). Forward-looking statements
in this press release include statements that refer to raising up to $30
million, whether the SEC will declare the Form F-3 effective we have filed and
allow us to offer securities, funding the expansion of Madge.web, gaining
flexibility in accessing the capital markets and other statements which are not
completely historical. These statements may differ materially from actual future
actions, events or results. For more information on risks, please refer to
Madge's recent SEC filings on Form 20F, Form 6-K and Form F-3.
Contact: Madge Networks, Wexham Springs, United Kingdom
Internet: www.madge.com
Company Contact: Investor Relations Contact:
Chris Bradley, Chief Financial Officer John Nesbett
MADGE NETWORKS N.V. LIPPERT/HEILSHORN & ASSOC.
Tel: (+44) 1753 661172 Tel: 212-838-3777
Lisa Ellis, Director of Investor & Public Relations
MADGE NETWORKS N.V.
Tel: 212-709-1007
<PAGE> 1
EXHIBIT 99.2
MADGE NETWORKS N.V. [MADGE LOGO]
Transpolis Schiphol Airport
Polaris Avenue 23
2132 JH Hoofddorp
The Netherlands
Main: (+31) (0) 23 5685526
Fax: (+31) (0) 23 5685528
MADGE NETWORKS N.V. COMPLETES LEGAL FORMATION OF
MADGE.WEB AND MADGE.CONNECT SUBSIDIARIES
PLANS TO RAISE ADDITIONAL FUNDS FOR THE EXPANSION OF MADGE.WEB
Amsterdam, The Netherlands (January 19, 2000) -- Madge Networks N.V. (NASDAQ NM:
MADGF), a global network solutions provider, today announced the completion of
the legal formation of its two wholly-owned subsidiaries, Madge.web Holdings
B.V. and Madge.connect Holdings B.V. The Company plans to raise additional funds
to support the expansion of Madge.web, including the rapid deployment of the
pan-European Madge Broadcast Network in partnership with RealNetworks (as
announced December 21).
The formation of the two subsidiaries allows them to operate with greater
financial independence and measurability, and will allow the introduction of new
equity capital into Madge.web. Madge.web is in active discussions with a select
group of potential equity investors, as a step along the path to a possible
future independent public listing.
In a parallel move, Madge Networks N.V. has filed a Form F-3 with the Securities
and Exchange Commission (SEC) which will, if declared effective by the SEC,
permit the Company to offer and sell, from time to time, various types of
securities including, but not limited to, common share and debt securities, up
to a total value of $30 million.
"We are very pleased to announce the next step in the independence of Madge.web
and Madge.connect," said Robert Madge, chairman of Madge Networks N.V. and CEO
of Madge.web. "Recent successes of Madge.web, and the increase of our service
offerings which will come from the partnership with RealNetworks, show that
<PAGE> 2
we are on the right track with this business and that we need to press ahead
with our aggressive investment plans. In particular we intend to use additional
funds to further develop Madge.web's position as a strong European player.
Meanwhile Madge.connect will be continuing with its strategy of supporting Token
Ring customers into the next generation of local area networking, and will
primarily be funding itself through cash from operations."
Investors will have the opportunity to listen to management's discussion of its
fourth quarter and year-end results, and its funding plans for Madge.web, in a
conference call to be held Thursday, January 20th at 8:30 a.m. (Eastern Time)
over the Internet through Vcall at www.vcall.com. To listen to the live call
please go to the web site at least fifteen minutes early to register, download,
and install any necessary audio software. A link to the Vcall will also be
available from our website at www.madge.com. For those who cannot listen to the
live broadcast, a replay will be available shortly thereafter by dialing
1-800-633-8284 (858-812-6440 for international callers), reservation #14194855,
or by visiting our website at www.madge.com.
ABOUT MADGE.WEB
Madge.web is a European-based company which provides network infrastructure and
application services to address the specific needs of multinational finance and
media companies. Services provided include fully managed web hosting, virtual
private networking, private networking and Internet advertising, and will soon
include streaming media distribution via the Madge Broadcast Network. The
services are delivered via the company's Overnet, by-passing the public Internet
to more than 30 countries around the world.
ABOUT MADGE.CONNECT
Madge.connect is a global supplier of advanced networking product solutions to
large enterprises. As the market leader in Token Ring, Madge.connect is
pioneering next generation networking solutions which enable the painless
deployment of 100Mbps and Gigabit speed IP-based applications within existing
corporate networks while protecting customers' investments in Token Ring and
ATM. As part of this strategy, Madge.connect provides a range of ISDN switching
and IP-based video networking products for real-time multimedia communications
across the network.
<PAGE> 3
ABOUT MADGE NETWORKS N.V.
Founded in 1986, Madge Networks N.V. (NASDAQ NM: MADGF) is a global managed
network services and product solutions provider specializing in mission-critical
enterprise needs. The company's goal is to optimize the implementation of
enterprises' voice, video and data networks with the ultimate aim of converging
all networking needs on Internet Protocol (IP) solutions. The company's main
business centers are at Wexham Springs, United Kingdom, New York City and
Eatontown, New Jersey. Madge Networks N.V., a company organized under the laws
of the Netherlands, is the parent company of Madge.web Holdings B.V. and
Madge.connect Holdings B.V. Information about Madge's complete range of products
and services can be accessed on the World Wide Web at www.madge.com
PRIVATE SECURITIES LITIGATION REFORM ACT STATEMENT
Investors should take note that certain statements in this press release are
forward-looking and may not give full weight to all of the potential risks
(e.g., our ability to raise additional funds, changing technologies,
competition, management of change and changed resource allocation resulting from
these and other factors). Forward-looking statements in this press release
include statements that refer to whether we will be successful in raising funds,
the way we will use these funds, the formation of the subsidiaries allowing us
to operate with greater financial independence and measurability, a possible
future independent listing, whether the SEC will declare the Form F-3 effective
we have filed and allow us to offer securities, the increase in our service
offering following the RealNetworks partnership, our intention to use any funds
for expansion of Madge.web and other statements which are not completely
historical. These statements may differ materially from actual future actions,
events or results. For more information on risks, please refer to Madge's recent
SEC filings.
Madge, the Madge logo, Madge.web and Madge.connect are trademarks, and in some
jurisdictions may be registered trademarks of Madge Networks or its affiliated
companies.
Contact: Madge Networks, Wexham Springs, United Kingdom
Internet: www.madge.com
Company Contact: Investor Relations Contact:
Chris Bradley, Chief Financial Officer John Nesbett
MADGE NETWORKS N.V. LIPPERT/HEILSHORN & ASSOC.
Tel: (+44) 1753 661172 Tel: 212-838-3777
Lisa Ellis, Director of Investor & Public Relations
MADGE NETWORKS N.V.
Tel: 212-709-1007
<PAGE> 1
EXHIBIT 99.3
MADGE NETWORKS N.V. [MADGE LOGO]
Transpolis Schiphol Airport
Polaris Avenue 23
2132 JH Hoofddorp
The Netherlands
Main: (+31) (0) 23 5685526
Fax: (+31) (0) 23 5685528
MADGE NETWORKS N.V.
FOURTH QUARTER AND FISCAL 1999 RESULTS
SEQUENTIAL REVENUE INCREASE OF 23 PER CENT IN FOURTH QUARTER
Amsterdam, The Netherlands (January 19, 2000) -- Madge Networks N.V. (NASDAQ NM:
MADGF), a global network solutions provider, today announced results for its
fourth fiscal quarter and full financial year ended December 31, 1999. (1)
Madge reported revenues of US$51.8 million for the fourth fiscal quarter, an
increase of $9.6 million or 23 per cent compared to revenues of $42.2 million
for the third quarter of 1999. Revenues for the fourth quarter of 1998 were
$53.3 million. The net loss was $5.3 million, or $(0.13) per share for the
quarter, compared to a net profit of $2.7 million, or $0.06 per share, for the
fourth quarter of fiscal 1998. Results for the 1999 quarter include special
gains of $8.8 million related to the release of certain provisions partly offset
by a charge related to the reorganization of Madge.connect.
For the 1999 fiscal year Madge reported revenues from continuing operations of
$196.2 million, compared to $242.4 million for the twelve months ended December
1998. The net loss for the year ended December 1999, based on continuing
operations was $40.3 million, or $(1.00) per share, and compares to a net profit
on the same basis of $8.9 million or $0.20 per share, for 1998. (2)
Including Madge's Ethernet Division (disposed of in the third quarter of 1998)
revenues for the fiscal year ended 1998 were $301.4 million.
Net loss for the fiscal year ended December 1999, including disposals and
non-recurring charges, was $40.3 million, or $(1.00) per share, in comparison to
(1) For the purposes of presentation, the Company has indicated its fiscal
quarters within the year as ending on the calendar month end, whereas, in
fact, the Company operates on the basis of thirteen-week financial
quarters.
(2) Results of Continuing Operations exclude Madge's Ethernet
Division Lannet, disposed of in the third quarter 1998, and Non-Recurring
charges incurred in the year to December 1998.
<PAGE> 2
a profit of $35.8 million, or $0.80 per share for the same period in 1998.
Cash balances at December 31, 1999 were $30 million compared to $130 million at
December 31, 1998. Madge.web has significant investment plans and as announced
in separate press releases today Madge has started activities to fund these
plans, including the introduction of new equity into Madge.web and the option,
following the approval of the Securities and Exchange Commission, to sell
securities of Madge Networks N.V. Based on current business projections Madge's
existing resources are sufficient to continue its investment plans into the
third quarter.
MADGE.WEB
Madge.web is a European-based company which provides network infrastructure and
application services to address the specific needs of multinational finance and
media companies. During the fourth quarter, the division added 28 new customers.
Madge.web revenues for the fourth quarter were $7.8 million, compared with $7.9
million for the third quarter of 1999. Additional new contracts were signed
during the quarter to an annualized value of $5.5 million.
MADGE.CONNECT
Madge.connect is a global supplier of advanced networking products including
Token Ring solutions, ISDN switching and IP-based video networking for large
enterprises. Madge.connect revenues increased 28% to $44 million from $34.3
million in the third quarter.
"We are very pleased with the results for the fourth quarter," said Robert
Madge, Chairman of Madge Networks N.V. "The return to strength of Madge.connect
revenues, supported by last August's acquisition of Olicom's Token Ring
business, demonstrates the success of our strategy to consolidate our market
position as the number one player in the Token Ring market, and continued cost
reduction will provide the basis for significant profit and cash generation.
Madge.web is proceeding according to plan with a significant momentum of new
orders, and further signing of new customers."
"Last quarter was a particularly important period for Madge.web," continued
Madge, "as we showed the first fruits of our entry into services for the media
market, demonstrated by new orders for our advertising bureau services of more
than half a million dollars annualized. Our partnership with RealNetworks to
<PAGE> 3
establish the Madge Broadcast Network for streaming media in Europe will further
boost our position in this market."
Investors will have the opportunity to listen to management's discussion of its
fourth quarter and year-end results in a conference call to be held Thursday,
January 20th at 8:30 a.m. (Eastern Time) over the Internet through Vcall at
www.vcall.com. To listen to the live call please go to the web site at least
fifteen minutes early to register, download, and install any necessary audio
software. A link to the Vcall will also be available from our website at
www.madge.com. For those who cannot listen to the live broadcast, a replay will
be available shortly thereafter by dialing 1-800-633-8284 (858-812-6440 for
international callers), reservation #14194855, or by visiting our website at
www.madge.com.
ABOUT MADGE NETWORKS N.V.
Founded in 1986, Madge Networks N.V. (NASDAQ NM: MADGF) is a global managed
network services and product solutions provider specializing in mission-critical
enterprise needs. The company's goal is to optimize the implementation of
enterprises' voice, video and data networks with the ultimate aim of converging
all networking needs on Internet Protocol (IP) solutions. The company's main
business centers are at Wexham Springs, United Kingdom, New York City and
Eatontown, New Jersey. Madge Networks N.V., a company organized under the laws
of the Netherlands, is the parent company of Madge.web Holdings B.V. and
Madge.connect Holdings B.V. Information about Madge's complete range of products
and services can be accessed on the World Wide Web at www.madge.com
PRIVATE SECURITIES LITIGATION REFORM ACT STATEMENT
Investors should take note that certain statements in this press release are
forward-looking and may not give full weight to all of the potential risks
(e.g., ability to raise additional funds, changing technologies, competition,
management of change and changed resource allocation resulting from these and
other factors). Forward-looking statements in this press release include
statements that refer to the introduction of new equity, the issuing of new
securities, the sufficiency of Madge's existing resources to meet projected
requirements, our investment requirements, the continued cost reduction in
Madge.connect, the significant profit and cash generation in Madge.connect, the
momentum of new orders for Madge.web and the boost the RealNetworks partnership
will have on our position in the market, and other statements which are not
completely historical. These statements may differ materially from actual future
actions, events or results. For more information on risks, please refer to
Madge's recent SEC filings.
Madge, the Madge logo, Madge.web and Madge.connect are trademarks, and in some
jurisdictions may be registered trademarks of Madge Networks or its affiliated
companies.
<PAGE> 4
Contact: Madge Networks, Wexham Springs, United Kingdom
Internet: www.madge.com
Company Contact: Investor Relations Contact:
Chris Bradley, Chief Financial Officer John Nesbett
MADGE NETWORKS N.V. LIPPERT/HEILSHORN & ASSOC.
Tel: (+44) 1753 661172 Tel: 212-838-3777
Lisa Ellis, Director of Investor & Public Relations
MADGE NETWORKS N.V.
Tel: 212-709-1007
<PAGE> 5
Madge Networks N.V.
Condensed Consolidated Balance Sheets
(Unaudited)
(in thousands)
<TABLE>
<CAPTION>
DEC. 31, DEC. 31,
1999 1998
-------- --------
<S> <C> <C>
ASSETS
Current assets:
Cash, cash equivalents, and short-term investments(1) $ 29,971 $130,494
Accounts receivable, net 38,655 38,966
Inventories 16,160 11,474
Prepaid expenses and other current assets 10,697 13,884
-------- --------
Total current assets 95,483 194,818
Investments, property and equipment, net 44,923 30,174
Intangible assets, net 52,092 --
Total assets $192,498 $224,992
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities $ 92,639 $ 90,661
Income taxes payable 16,715 13,228
Short term borrowings 7,107 1,633
Short term obligations 3,298 2,178
-------- --------
Total current liabilities 119,759 107,700
Long-term obligations 3,563 899
-------- --------
Total liabilities 123,322 108,599
Shareholders' equity 69,176 116,393
-------- --------
Total liabilities and shareholders' equity $192,498 $224,992
======== ========
</TABLE>
________
(1) Cash includes a balance of $10.5M that has restricted use.
<PAGE> 6
Madge Networks N.V.
Condensed Consolidated Statements of Operations
(Unaudited)
(in thousands)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
DECEMBER 31,
1999 1998
-------------------------
<S> <C> <C>
Net sales $ 51,803 $ 53,317
Cost of sales 31,550 23,358
-------- --------
Gross profit 20,253 29,959
Operating expenses:
Sales & marketing 19,353 17,343
Research & development 6,859 9,244
General and administrative 7,824 1,156
Special Gains (8,776) --
-------- --------
Total operating expenses 25,260 27,743
-------- --------
(Loss) income from operations (5,007) 2,216
Net interest income (expense) 160 1,561
-------- --------
(Loss) income before tax (4,847) 3,777
Income tax provision (benefit) 409 1,083
-------- --------
Net (Loss) income $ (5,256) $ 2,694
======== ========
Earnings per share
Basic $ (0.13) $ 0.06
Diluted $ (0.13) $ 0.06
Weighted Average Shares Outstanding
Basic 40,305 43,191
Diluted 40,305 43,344
</TABLE>
<PAGE> 7
Madge Networks N.V.
Condensed Consolidated Statements of Operations
(Unaudited)
(in thousands)
<TABLE>
<CAPTION>
RESULTS OF CONTINUING GROUP RESULTS (INCL. DISPOSED
OPERATIONS DIVISION & NON-RECURRING ITEMS)
TWELVE MONTHS ENDED TWELVE MONTHS ENDED
DECEMBER 31, DECEMBER 31,
1999 1998 1999 1998
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Net sales $ 196,152 $ 242,356 $ 196,152 $ 301,372
Cost of sales 115,547 117,670 115,547 147,103
--------- --------- --------- ---------
Gross profit 80,605 124,686 80,605 154,269
Operating expenses:
Sales & marketing 73,145 64,194 73,145 81,667
Research & development 33,230 36,013 33,230 48,021
General and administrative 23,339 14,903 23,339 18,556
Special Gains (7,539) -- (7,539) (29,611)
--------- --------- --------- ---------
Total operating expenses 122,175 115,110 122,175 118,633
--------- --------- --------- ---------
(Loss) income from operations (41,570) 9,576 (41,570) 35,636
Net interest income (expense) 2,195 2,344 2,195 3,272
--------- --------- --------- ---------
(Loss) income before tax (39,375) 11,920 (39,375) 38,908
Income tax provision (benefit) 938 3,068 938 3,085
--------- --------- --------- ---------
Net (Loss) income $ (40,313) $ 8,852 $ (40,313) $ 35,823
========= ========= ========= =========
Earnings per share
Basic $ (1.00) $ 0.20 $ (1.00) $ 0.81
Diluted $ (1.00) $ 0.20 $ (1.00) $ 0.80
Weighted Average Shares Outstanding
Basic 40,420 44,404 40,420 44,404
Diluted 40,420 44,624 40,420 44,624
</TABLE>
