SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): December 14, 1999.
ADVANTAGE LEARNING SYSTEMS, INC.
(Exact name of registrant as specified in its charter)
Wisconsin 0-22187 39-1559474
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
2911 Peach Street
P.O. Box 8036
Wisconsin Rapids, Wisconsin 54495-8036
(Address of principal (Zip Code)
executive offices)
Registrant's telephone number, including area code: (715) 424-3636
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Item 5. Other Events
On December 14, 1999, Advantage Learning Systems, Inc. (the
"Company") issued a press release regarding expected financial
and operating results for the fourth quarter of 1999. A copy of
the December 14, 1999 press release is attached as an exhibit to
this report and is incorporated herein by reference.
Item 7. Exhibits.
Exhibit No. Description
99.1 Press Release dated December 14, 1999
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SIGNATURE
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 hereunto duly authorized.
Dated: December 15, 1999
ADVANTAGE LEARNING SYSTEMS, INC.
By: /s/Michael H. Baum
-----------------------------
Michael H. Baum
Chief Executive Officer
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EXHIBIT INDEX
Exhibit No. Description
99.1 Press Release dated December 14, 1999.
Exhibit 99.1
Wisconsin Rapids, Wis., Dec. 14/PRNewswire/ -- Advantage
Learning Systems, Inc. (Nasdaq: ALSI - news), a leading provider
of learning information systems to the K-12 school market, today
announced that fourth-quarter earnings are expected to decline
from the previous quarter. The Company expects quarterly
earnings to be between $0.08 and $0.10 per share, compared to
$0.16 per share in the third quarter of 1999, and $0.13 per share
in the fourth quarter 1998. Quarterly revenues are expected to
be up approximately 20% from last year, though down from the
third quarter 1999.
"The late shipment of the new version of Accelerated Reader
slowed both follow-on purchases and adoptions by new schools,"
said Michael Baum, chief executive officer. "Though about 15,000
schools ordered upgrades, we were not able to start shipping till
late September, which missed the prime fall buying season for
schools. We expect to feel the effects of this delay through the
first quarter of next year. Also, California sales were slower
than we expected in view of the recent state adoption of the
reading products; we believe this may be partially due to
districts delaying their orders while awaiting final funding
information from the state. To a lesser extent, results were
affected by purchasing freezes due to Y2K policies at any
corporations, which has impacted sales of our Generation21
training software."
Because of lower than expected sales, the Company said that
it expects its cost of sales and operating costs to be higher as
a percent of revenues than previous quarters. Also, the Company
has significantly increased marketing and product development
expenditures for its new math products, the new version of STAR
Reading, the new School Renaissance district-wide improvement
program, writing products, international expansion, and distance
learning.
"We are increasing our expenditures on new products and
marketing because we are very positive about the long-term
outlook," said Baum. "We have unique products and services that
are reaching more users in schools than ever before. We recently
introduced on-line ordering of Accelerated Reader quizzes over
the Internet, and initial results indicate that our customers are
very enthusiastic about this easier and more efficient way to
build their quiz collections. Our new math programs sold in
their first year to over 6,000 schools, and interest from
additional schools is running very strong, though the sales cycle
for math appears to be longer than for reading. Overall, our
market position has become even stronger over the last several
years and we are very confident about the future prospects for
both new and existing products."
The Company expects that it will add approximately 1,200 new
schools to its customer base during the fourth quarter, compared
to 1,900 in the third quarter and 1,700 in the fourth quarter
1998. Despite the slowdown, total new schools added in 1999 are
expected to exceed the Company's 1999 target of 6,000-7,000,
bringing the total school base to over 48,000, or more than 40%
of all US schools. The Company also expects to meet or exceed
its annual goal of 70,000 - 75,000 educators trained through its
Renaissance training programs.
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Advantage Learning Systems provides K-12 schools with
computerized learning information systems: software and related
training designed to improve academic performance by increasing
the quality, quantity, and timeliness of information in the
classroom.
Advantage Learning Systems' software products include
Accelerated Reader, the most widely-used reading software in K-12
schools; STAR Reading; STAR Math; Accelerated Math; and Perfect
CopyT writing skills software. The Company has trained about
200,000 educators through its Reading Renaissance and Math
Renaissance professional development programs; provides test
generation software to textbook publishers; and sells enterprise
software for organization-wide training and knowledge management.
The Company also has subsidiaries in Canada, India, Australia,
and the United Kingdom.
This press release contains forward-looking statements made
pursuant to the safe harbor provision of the Private Securities
Litigation Reform Act of 1995, including statements regarding
future financial and operating results for the fourth quarter of
1999. Any such forward-looking statements may involve risk and
uncertainties that could cause actual results to differ
materially from any future results encompassed within the forward-
looking statements. Factors that could cause or contribute to
such differences include those matters disclosed in the Company's
Annual Report on Form 10-K and the Company's other Securities and
Exchange Commission filings.
