<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): July 25, 1996
QUARTERDECK CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Delaware 0-19207 95-4320650
(STATE OR OTHER (COMMISSION FILE (I.R.S. EMPLOYER
JURISDICTION OF NUMBER) IDENTIFICATION NO.)
INCORPORATION)
13160 Mindanao Way, Marina del Rey, California 90292
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (310) 309-3700
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ITEM 5. OTHER EVENTS.
On July 25, 1996, Quarterdeck Corporation issued a press
release with respect to results for the third quarter ended June 30, 1996. A
copy of the press release dated July 25, 1996 is filed as Exhibit 99.1.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(c) Exhibits.
99.1 July 25, 1996 press release.
Page 2 of 3 pages
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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 hereunto duly authorized.
QUARTERDECK CORPORATION,
a Delaware corporation
By: /s/ FRANK R. GREICO
--------------------------
Name: Frank R. Greico
Title: Senior Vice President and
Chief Financial Officer
July 25, 1996
Page 3 of 3 pages
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Contacts: Frank Greico/Ellen Spooren Jim Lucas
Quarterdeck Corporation Johnnie D. Johnson & Co., Inc.
(310) 309-4261 (213) 626-4848
[email protected] [email protected]
QUARTERDECK CORPORATION ANNOUNCES SHARPLY LOWER SALES
AND SUBSTANTIAL OPERATING LOSS FOR 3Q
ACCELERATES RESTRUCTURING, INTRODUCES NEW PRODUCTS TO RESTORE PROFITABILITY AND
GROWTH
MARINA DEL REY, Calif., July 25 -- Quarterdeck Corporation
(NASDAQ: QDEK), a leading developer and marketer of PC utilities and Internet
software, today announced sharply lower sales and a substantial operating loss
for the third quarter ended June 30, 1996. As the company stated on June 13,
the losses were due primarily to a significant decline in sell-through levels
for memory-management products that the company is about to update; a decline
to historic rates of sell-through of PROCOMM PLUS data communications software
following unusually high sales after a new-product launch in the prior quarter;
and slower than planned integration of acquisitions.
Results, in millions of dollars except per-share data, as restated for
acquisitions, were:
<TABLE>
<CAPTION>
3Q 3Q 9 mo. 9 mo.
96 95* 96* 95*
-- --- --- ----
<S> <C> <C> <C> <C>
Net revenues $16.0 $28.1 $105.7 $86.3
Operating income (loss) (26.9) 3.4 (15.4) 13.7
Net income (loss) (22.9) .5 (19.4) 11.0
Net income (loss) per share
before one-time charges (0.68) 0.12 (0.37) 0.46
Income (loss) per share (0.73) 0.02 (0.62) 0.35
</TABLE>
* = as restated for acquisitions
Gaston Bastiaens, president and chief executive officer of
Quarterdeck, said, "In the fourth quarter, we are introducing new versions of
many of the strongest products at the core of our franchise and accelerating
our restructuring to restore growth and profitability. Despite this major
correction, we still expect to return to a revenue level in the fiscal fourth
quarter that will enable the company to exceed 30% revenue growth in fiscal
1996 over the previous
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year." Bastiaens added, "Beginning in 1995, we set strategies to build a
diverse and balanced product portfolio. We continue to strengthen our
position in profitable utilities software markets, and to focus as well on the
most promising new Internet software solutions. In fact, for the first time, in
the third quarter, Internet products accounted for more than half of our
revenues."
The operating results reflect additional reserves for sales returns
and allowances of $4.2 million above normal reserves. In addition, the balance
sheet reflects non-cash charges of $4.5 million for accrued liabilities that
include reserves for inventory, capitalized third-party software costs and
prepaid royalties, legal expenses, and bad debts. Quarterdeck ended the
quarter with $14.4 million in cash.
After the close of the third quarter, Quarterdeck further strengthened
its utilities line and distribution reach with the accretive acquisition of
Vertisoft Systems, Inc., which had fiscal-year revenues of approximately $16
million. Its products include utilities such as Remove-It and the recently
launched Vertisoft Fix-It, a Windows 95 repair program. Vertisoft's direct-mail
marketing organization complements Quarterdeck's telemarketing operation
(Quarterdeck Select Corporation), enhancing distribution by providing a new
channel for selling Internet and utilities products.
In the fourth quarter, the company expects to launch upgrades of its
established utilities products, MagnaRAM, CleanSweep and HiJaak Pro. Also, in
the coming months, the company expects to ship a 32-bit version of PROCOMM
PLUS; an upgrade of QEMM; and an advanced version of WebCompass, an Internet
information management tool.
The company accelerated its previously announced restructuring
program. Through the reduction of overlapping positions, the company already
has eliminated more than half of the positions that are planned for the 11%
head count reduction to be completed during the fourth quarter. The
elimination of redundant positions, the consolidation of facilities and the
consolidation of the management structure into the Utilities and Internet
divisions has resulted in a reduction of ongoing operating costs in excess of
$20 million on an annualized basis.
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FORWARD-LOOKING STATEMENT: When used in the preceding discussion, the word
"expected" and similar conditional expressions are intended to identify
forward-looking statements. Such statements are subject to certain risks and
uncertainties that could cause actual results to differ materially from those
expressed in any of the forward-looking statements. Such risks and
uncertainties include, but are not limited to, conditions in the general
economy or the software industry, the timely development and market acceptance
of products and technologies, competitive factors, demand for memory-management
software products, sell-through of products in the sales channels, successful
integration of acquisitions, the ability to secure additional sources of
financing, and other risks described from time to time in Quarterdeck's SEC
reports and filings.
ABOUT QUARTERDECK CORPORATION
Quarterdeck Corporation is a pioneer in the development of software
products in the utilities and Internet areas. The company leads the industry
in bringing utilities solutions to the Windows environments, and offers an
entire line of powerful, next-generation Internet and communications tools for
corporate, small business and individual users. Quarterdeck Corporation is
headquartered at 13160 Mindanao Way, Marina del Rey, CA 90292. Its European
headquarters are in Dublin, Ireland, with other offices in England, France and
Australia. Further product availability and pricing information may be
obtained by calling (310) 309-3755, by accessing Quarterdeck's Internet Web
site is at http://www.quarterdeck.com/, or by sending an email request to
[email protected]/.
Quarterdeck, QEMM, HiJaak, Remove-It, DATASTORM and PROCOMM PLUS are registered
trademarks of Quarterdeck Corporation or its subsidiaries. WebCompass,
MagnaRAM, CleanSweep, Vertisoft Fix-It and Vertisoft are trademarks of
Quarterdeck Corporation or its subsidiaries. All other brand and product names
are trademarks or registered trademarks of their respective companies.
# # #
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QUARTERDECK CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
(AMOUNTS IN THOUSANDS)
ASSETS
<TABLE>
<CAPTION>
June 30, September 30,
1996 1995
(Unaudited)
============ ==============
<S> <C> <C>
Current assets
Cash and short-term investments $14,409 $39,669
Trade accounts receivable 12,623 13,621
Refundable income taxes 3,284 --
Deferred tax asset 4,515 2,178
Inventories 3,376 2,281
Other current assets 5,021 4,006
------------ --------------
Total current assets 43,228 61,755
Building 8,720 --
Note receivable from related party - building -- 469
Equipment and leasehold improvements 11,897 8,335
Capitalized software costs 4,433 2,807
Other assets 8,795 3,333
------------ --------------
$77,073 $76,699
============ ==============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable $7,855 $13,582
Accrued liabilities 17,331 14,973
Current portion of long-term obligations 17 255
Accrued acquisition, restructuring,
and other charges 3,380 3,455
------------ --------------
Total current liabilities 28,583 32,265
Convertible notes payable and other
long-term obligations 25,114 164
Stockholders' equity 23,376 44,270
------------ --------------
$77,073 $76,699
============ ==============
</TABLE>
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QUARTERDECK CORPORATION AND SUBSIDIARIES
CONSOLIDATED UNAUDITED CONDENSED STATEMENTS OF OPERATIONS
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
Three months ended Nine months ended
June 30, June 30,
1996 1995 1996 1995
========================= ==========================
<S> <C> <C> <C> <C>
Net Revenues 16,022 28,091 105,683 86,302
Less: Cost of Revenues 11,252 8,120 36,045 25,008
------------------------- --------------------------
Gross Margin 4,770 19,971 69,638 61,294
Operating Expenses
Research & Development 5,365 3,937 15,875 10,540
Sales & Marketing 17,089 7,699 48,253 21,320
General & Administrative 9,216 4,913 20,907 15,780
------------------------- --------------------------
Total Operating Expenses 31,670 16,549 85,035 47,640
------------------------- --------------------------
Operating Income (loss) before one-time charges (26,900) 3,422 (15,397) 13,654
Other income, net 1,305 1,718 1,279
------------------------- --------------------------
Income (loss) before taxes & one-time charges (25,595) 4,022 (13,679) 14,933
Provision (benefit) for income taxes (4,045) (2,058) 468
------------------------- --------------------------
Income (loss) before one-time charges (21,550) 3,786 (11,621) 14,465
Acquisition, restructuring and other one-time 1,660 3,459 9,130 3,603
Tax (benefit) from acquisition and other one-time (262) (1,373) (113)
------------------------- --------------------------
Net Income (loss) $ (22,948) $ 530 $ (19,378) $ 10,975
========================= ==========================
Net Income (loss) per share before one-time chgs $ (0.68) $ 0.12 $ (0.37) $ 0.46
========================= ==========================
Net Income (loss) per share $ (0.73) $ 0.02 $ (0.62) $ 0.35
========================= ==========================
Shares used to compute net income (loss) per share 31,547 30,649 31,421 31,501
========================= ==========================
</TABLE>
