Filed by NetIQ Corporation
Pursuant to Rule 425 Under the Securities Act of 1933
And Deemed Filed Pursuant to Rule 14a-12
Under the Exchange Act of 1934
Subject Company: WebTrends Corporation
Commission File No. 000-25215
PRESS RELEASE
NetIQ Corporation Announces
Record Second Quarter Revenue and Earnings
SAN JOSE, CA -- Jan. 18, 2001 -- NetIQ(R) Corporation (Nasdaq: NTIQ), a
leading provider of e-business infrastructure management software that enables
organizations to optimize the performance and availability of their Microsoft
Windows NT- and Windows 2000-based systems and applications, today reported
record revenue and earnings for its second fiscal quarter ended December 31,
2000.
Total revenue for the quarter ended December 31, 2000 increased to
$39,653,000, compared to $9,122,000 in the same quarter of the prior fiscal
year, representing a 335% increase. Excluding amortization of goodwill and
other intangibles and stock-based compensation, net income for the second
quarter was $8,553,000, or $0.20 per diluted share, compared to net income of
$1,608,000 or $0.09 per diluted share in the same quarter of the prior fiscal
year.
Revenue for the six months ended December 31, 2000 increased to
$70,182,000, compared to $16,708,000 in the same six-month period in the prior
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fiscal year. Excluding amortization of goodwill and other intangibles and
stock-based compensation, net income for the six months was $15,063,000, or
$0.36 per diluted share, compared to net income of $2,258,000 or $0.13 per
diluted share in the same six-month period of the prior fiscal year.
Since merging with Mission Critical Software in May 2000, the Company has
continued to meet its internal plans. On a pro-forma combined basis, revenues
in the quarter and the six months ended December 31, 1999, were $22,377,000 and
$41,692,000, respectively. On a pro-forma combined basis, excluding stock-based
compensation, net income for the quarter and six months ended December 31, 1999
was $2,455,000, or $0.06 per diluted share, and $3,323,000, or $0.08 per
diluted share, respectively.
"We are pleased to again announce record revenue and earnings. This is the
sixth consecutive quarter of increasing revenue and profitability since
becoming a public company in July 1999", said Ching-Fa Hwang, President and
CEO. "Customer demand for our solutions is strong and NetIQ's products are
becoming more widely accepted in the marketplace as the leading Windows-based
management solution for enterprises, eBusinesses and service providers."
Hwang added, "Our announcement yesterday to merge with WebTrends
Corporation is a strategically important and logical step in fulfilling our
goal to provide the most comprehensive infrastructure management and
intelligence solutions for all the components of eBusiness infrastructure --
from back-end servers, applications, networks and directories to front-end web
servers and applications."
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Second Quarter Operating highlights:
o NetIQ and Microsoft announced a licensing, development and marketing
agreement in which Microsoft was granted a perpetual non-exclusive
license of NetIQ's Operations Manager technology for $175 million, to
be paid over a period of three years, and agreed to other development
and marketing programs and fees. As part of this broad agreement,
NetIQ becomes the Premier Independent Software Vendor (ISV) partner
for Microsoft operations management solutions--the only vendor with
such a designation--and becomes a Microsoft Global Technology Partner;
o Significant new products such as Security Manager, AppManager for
Exchange 2000, AppManager for SQL Server 2000, Operations Manager 3.3,
Directory Migration Administrator, Server Consolidator 2.0, Chariot
4.0, ADCheck for Windows 2000 Active Directory were introduced;
o NetIQ's Operations Manager product received Network World's
prestigious "Best of Test" award and NetIQ's AppManager product was
chosen by Windows 2000 Magazine for the second consecutive year as
Application Management Software of the Year 2000;
o The Company's headquarters moved to a newly renovated facility in San
Jose, CA, which can accommodate more than 300 personnel;
o NetIQ expanded its presence in Latin America. The company now has
direct presence in Brazil and Mexico, with channel partner operations
delivering its solutions throughout Latin America.
NetIQ Analyst/Investor Conference Call
NetIQ will conduct a conference call at 1:30 p.m. PST today to discuss
results in more detail and to provide guidance for the remainder of the fiscal
year.
Conference numbers: Domestic: 800-562-8369 International: 913 981-5581
Conference ID: 514117
Replay: Domestic: 888-203-1112 International: 719-457-0820
Conference ID: 514117
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About NetIQ
NetIQ (Nasdaq:NTIQ) is a leading provider of e-business infrastructure
management software encompassing application, directory, server and network
performance management. The company is headquartered in San Jose, Calif., with
development and operational personnel in Houston, TX; Raleigh, NC; and
Bellevue, WA. For more information, please visit NetIQ's Web site at
http://www.netiq.com/ or call 408-856-3000.
# # #
All referenced product names are trademarks of their respective companies.
Shareholders of WebTrends and NetIQ are urged to read the joint proxy
statement-prospectus included in the registration statement on Form S-4 to be
filed by NetIQ with the Securities and Exchange Commission because it contains
important information. Upon filing with the SEC, this document will be
available free of charge on the SEC Website at http://www.sec.gov/ and from
WebTrends Corporation and NetIQ Corporation.
Safe Harbor Statement
Statements in this press release other than statements of historical fact are
"forward-looking" statements within the meaning of the Private Securities
Litigation Reform Act of 1995. The companies' actual future results could
differ materially from the results discussed herein. Factors that could cause
or contribute to such differences include the risks inherent in acquisitions of
technology businesses including the successful consummation of the merger and
integration of the companies, the timing and successful development of
technology; the ability to retain key management and hire technical personnel
and other employees; changing relationships with customers, suppliers and
strategic partners; unanticipated costs associated with development and
marketing activities; customer acceptance of new product offerings; pricing of
new products, and competition in our various product lines. For a more complete
discussion of risks and uncertainties for each company see the section entitled
"Factors That May Affect Future Results" in the NetIQ annual report on Form
10-K, and "Risk Factors" in the WebTrends annual report on Form 10-K as filed
with the Securities and Exchange Commission.
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NetIQ Corporation
Condensed Consolidated Balance Sheets
(In thousands)
December 31,
2000 June 30,
(Unaudited) 2000
----------- --------
ASSETS
Current assets:
Cash and cash equivalents $ 97,844 $ 187,610
Short-term investments 250,570 145,916
Accounts receivable, net 26,399 10,744
Prepaid expenses 953 3,478
---------- ----------
Total current assets 375,766 347,748
---------- ----------
Property and equipment, net 40,030 7,181
Goodwill and other intangibles, net 1,121,437 1,365,891
Other assets 903 941
---------- ----------
Total assets $1,538,136 $1,721,761
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 4,522 $ 2,044
Accrued compensation and related benefits 11,034 5,023
Other liabilities 9,513 11,285
Deferred revenue 21,988 17,687
---------- ----------
Total current liabilities 47,057 36,039
---------- ----------
Stockholders' equity:
Common stock 1,785,797 1,760,396
Deferred stock-based compensation (937) (1,286)
Accumulated deficit (294,371) (73,271)
Accumulated other comprehensive loss 590 (117)
---------- ----------
Total stockholders' equity 1,491,079 1,685,722
---------- ----------
Total liabilities and stockholders' equity $1,538,136 $1,721,761
========== ==========
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NetIQ Corporation
Condensed Consolidated Statements of Operations
(In thousands, except per share amounts)
<TABLE>
Three Months Six Months
Ended December 31, Ended December 31,
------------------ ------------------
(Unaudited) (Unaudited)
2000 1999 2000 1999
---- ---- ---- ----
<S> <C> <C> <C> <C>
Software license revenue $ 30,527 $ 7,379 $ 53,593 $ 13,600
Service revenue 9,126 1,743 16,589 3,108
--------- ---------- --------- --------
Total revenue 39,653 9,122 70,182 16,708
--------- ---------- --------- --------
Cost of software license revenue 511 173 856 329
Cost of service revenue 1,972 397 3,318 816
--------- ---------- --------- --------
Total cost of revenue 2,483 570 4,174 1,145
--------- ---------- --------- --------
Gross profit 37,170 8,552 66,008 15,563
--------- ---------- --------- --------
Operating expenses:
Sales and marketing 17,902 4,851 33,058 8,975
Research and development 7,441 1,879 14,050 3,588
General and administration 2,675 754 4,887 1,507
Stock-based compensation 170 174 340 352
Amortization of goodwill and other
intangibles 118,819 - 238,213
--------- ---------- --------- --------
Total operating expenses 147,007 7,658 290,548 14,422
--------- ---------- --------- --------
Income (loss) from operations (109,837) 894 (224,540) 1,141
--------- ---------- --------- --------
Interest income, net 4,861 918 10,680 1,265
--------- ---------- --------- --------
Income (loss) before income taxes (104,976) 1,812 (213,860) 2,406
Income taxes 4,340 379 7,240 501
--------- ---------- --------- --------
Net income (loss) (109,316) $ 1,433 (221,100) $ 1,905
========= ========== ========= ========
Basic net income (loss) per share $ (2.83) $ 0.09 $ (5.83) $ 0.14
Shares used to compute basic
net income (loss) per share 38,596 15,709 37,942 $13,832
Diluted net income (loss) per share $ (2.83) $ 0.08 $ (5.83) $ 0.11
Shares used to compute diluted
net income (loss) per share 38,596 17,556 37,942 16,868
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SUPPLEMENTAL INFORMATION:
Net income excluding stock-based
compensation, amortization of
goodwill and other intangilbes,
and related income tax effects $ 8,553 $ 1,608 $ 15,063 $ 2,258
========= ========== ========= ========
Diluted net income per share $ 0.20 $ 0.09 $ 0.36 $ 0.13
Shares used to compute diluted
net income per share 43,014 17,556 42,293 16,868
</TABLE>
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Contacts:
For NetIQ:
Susan Torrey, Press Relations, 713-548-1863, [email protected]
Jim Barth, Chief Financial Officer, 408-856-3000, [email protected]
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NetIQ Corporation, its officers and directors may be deemed to be
participants in the solicitation of proxies from NetIQ's shareholders with
respect to the transactions contemplated by the merger agreement. Information
regarding such officers and directors is included in NetIQ's proxy statement
filed with the SEC on October 6, 2000. This document is available free of
charge at the SEC website at www.sec.gov and from the NetIQ Corporation contact
listed below.
SHAREHOLDERS OF WEBTRENDS AND NETIQ ARE URGED TO READ THE JOINT PROXY
STATEMENT-PROSPECTUS TO BE INCLUDED IN THE REGISTRATION STATEMENT ON FORM S-4
TO BE FILED BY NETIQ WITH THE SECURITIES AND EXCHANGE COMMISION BECAUSE IT WILL
CONTAIN IMPORTANT INFORMATION. UPON FILING WITH THE SEC, THIS DOCUMENT WILL BE
AVAILABLE FREE OF CHARGE ON THE SEC WEBSIDE AT WWW.SEC.GOV AND FROM WEBTRENDS
CORPORATION AND NETIQ CORPORATION THROUGH THE CONTACTS LISTED BELOW.
Contacts:
NetIQ Corporation
Susan Torrey, Press Relations
(713) 548-1863
[email protected]
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