<PAGE>
FORM 10-Q/A AMENDMENT NO. 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
[ X ] QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended March 31, 1997
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number 0-15935
ALTRIS SOFTWARE, INC.
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(Exact name of registrant as specified in its charter)
CALIFORNIA 95-3634089
- ------------------------------- ---------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
9339 CARROLL PARK DRIVE, SAN DIEGO, CA 92121
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(Address of principal executive offices and zip code)
(619) 625-3000
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(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
YES X NO
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Number of shares of Common Stock outstanding at April 25, 1997: 9,578,870
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<PAGE>
In March 1998, Altris Software, Inc. (the "Company") announced that it
was conducting a review of its interim financial information and annual
financial statements for 1996 and the interim information for the first three
quarters of 1997 with a view to determining whether the revenue previously
reported for such periods was recognized in accordance with generally
accepted accounting principles. As a result of this review, the Company has
restated such financial statements. This Amendment to the Company's
Quarterly Report on Form 10-Q sets forth the restated financial statements of
the Company for the three months ended March 31, 1997.
Information in the Quarterly Report on Form 10-Q as originally filed was
presented as of the date of such original filing or earlier, as indicated
therein. Unless otherwise stated, such information has not been updated in
this Amendment. In particular, "Item 2. Management's Discussion and
Analysis of Financial Condition and Results of Operations" as originally
filed discussed the Company's financial condition and results of operations
based on the financial statements in the Quarterly Report on Form 10-Q as
originally filed, without consideration of the restatement reflected herein,
and therefore no reliance should be placed thereon. Please refer to "Item 7.
Management's Discussion and Analysis of Financial Condition and Results of
Operations" appearing in the Company's Annual Report on Form 10-K for the
year ended December 31, 1997.
1
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ALTRIS SOFTWARE, INC.
PART I. FINANCIAL INFORMATION
CONSOLIDATED BALANCE SHEET
(Restated)
<TABLE>
<CAPTION>
March 31, 1997 December 31, 1996
-------------- -----------------
(unaudited)
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 1,440,000 $ 2,200,000
Short term investments - 90,000
Receivables, net 4,400,000 5,050,000
Inventory, net 539,000 472,000
Other current assets 917,000 683,000
------------ ------------
Total current assets 7,296,000 8,495,000
Property and equipment, net 2,075,000 2,156,000
Computer software, net 2,485,000 2,252,000
Goodwill, net 4,759,000 4,972,000
Other assets 455,000 385,000
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$ 17,070,000 $ 18,260,000
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------------ ------------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 2,979,000 $ 2,487,000
Accrued liabilities 1,507,000 1,686,000
Notes payable 1,019,000 710,000
Deferred revenue 1,507,000 1,548,000
------------ ------------
Total current liabilities 7,012,000 6,431,000
Long term notes payable 1,383,000 1,203,000
Other long term liabilities 312,000 763,000
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Total liabilities 8,707,000 8,397,000
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Commitments
Shareholders' equity:
Common stock, no par value, 20,000,000 shares
authorized; 9,573,444 and 9,559,944 issued
and outstanding, respectively 61,630,000 61,583,000
Foreign currency translation adjustment 56,000 3,000
Accumulated deficit (53,323,000) (51,723,000)
------------ ------------
Total shareholders' equity 8,363,000 9,863,000
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$ 17,070,000 $ 18,260,000
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</TABLE>
See accompanying notes to the consolidated financial statements.
2
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ALTRIS SOFTWARE, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited)
(Restated)
<TABLE>
<CAPTION>
For the three months
ended March 31,
-----------------------------
1997 1996
------------ ------------
<S> <C> <C>
Revenues $ 3,985,000 $ 4,161,000
Cost of revenues 2,142,000 2,407,000
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Gross profit 1,843,000 1,754,000
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Operating expenses:
Research and development 916,000 907,000
Marketing and sales 1,744,000 1,253,000
General and administrative 754,000 711,000
------------ ------------
Total operating expenses 3,414,000 2,871,000
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Loss from operations (1,571,000) (1,117,000)
Interest and other income 22,000 26,000
Interest and other expense (51,000) (26,000)
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Loss before income taxes (1,600,000) (1,117,000)
Provision for income taxes - -
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Net loss $ (1,600,000) $(1,117,000)
------------ ------------
------------ ------------
Net loss per share $ (.17) $ (.12)
------------ ------------
------------ ------------
Weighted average shares outstanding 9,565,000 9,027,000
</TABLE>
See accompanying notes to the consolidated financial statements
3
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ALTRIS SOFTWARE, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
(Restated)
<TABLE>
<CAPTION>
For the three months
ended March 31,
--------------------------
1997 1996
----------- -----------
<S> <C> <C>
Cash flow from operating activities:
Net loss $(1,600,000) $(1,117,000)
Adjustments to reconcile net loss to
net cash used in operating activities:
Depreciation and amortization 599,000 530,000
Changes in assets and liabilities:
Receivables, net 650,000 466,000
Inventory (67,000) (55,000)
Other assets (305,000) 163,000
Accounts payable 492,000 125,000
Accrued liabilities (179,000) (1,491,000)
Deferred revenue (41,000) (379,000)
Other long term liabilities (451,000) (123,000)
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Net cash used in operating activities (902,000) (1,881,000)
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Cash flows from investing activities:
Sale of short term investment 85,000 180,000
Purchases of property and equipment (122,000) (192,000)
Purchases of software (39,000) (15,000)
Computer software capitalized (371,000) (226,000)
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Net cash used in investing activities (447,000) (253,000)
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Cash flows from financing activities:
Principal payment under cash advanced
by a bank related to former Optigraphics
shareholder notes payable - (1,634,000)
Repayments under notes payable (174,000) (40,000)
Net borrowings under revolving loan
and bank agreements 663,000 -
Proceeds from exercise of stock options 47,000 210,000
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Net cash provided by (used in) financing activities 536,000 (1,464,000)
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Effect of exchange rate changes on cash 53,000 16,000
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Net decrease in cash and cash equivalents (760,000) (3,582,000)
Cash and cash equivalents at beginning of period 2,200,000 4,656,000
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Cash and cash equivalents at end of period $ 1,440,000 $ 1,074,000
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Supplemental cash flow information:
Interest paid $ 44,000 $ 25,000
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Schedule of non-cash financing activity:
Conversion of Series B Preferred Stock
to common stock $ - $ 3,306,000
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----------- -----------
Conversion of note payable to common stock $ - $ 1,000,000
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</TABLE>
See accompanying notes to the consolidated financial statements.
4
<PAGE>
ALTRIS SOFTWARE, INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE 1 - BASIS OF PRESENTATION
The accompanying consolidated balance sheet of Altris Software, Inc.
(the "Company") as of March 31, 1997 and the consolidated statement of
operations and of cash flows for the three month periods ended March 31, 1997
and 1996 are unaudited. The consolidated financial statements and related
notes have been prepared in accordance with generally accepted accounting
principles applicable to interim periods. In the opinion of management, the
consolidated financial statements reflect all adjustments, consisting only of
normal recurring adjustments, necessary for a fair presentation of the
consolidated financial position, operating results and cash flows for the
periods presented.
The consolidated financial statements include the accounts of the
Company and its wholly owned subsidiaries. All significant intercompany
balances and transactions have been eliminated.
The financial statements included herein have been restated from those
previously published to reflect corrections of misapplications of the
Company's for revenue recognition policies. The results for the quarters
ended March 31, 1997 and 1996 have been amended to reflect changes in the
timing and amount of revenue recognition for those contracts where
subsequently discovered facts indicate that revenue had initially been
recognized before: (a) there was persuasive evidence of an agreement between
the Company and the customer; (b) the amount of the fee had become fixed; (c)
there was sufficient evidence of the delivery of the product or services; (d)
customer cancellation rights had expired; or (e) a reasonable estimate could
be made of returns from those customers (primarily Value Added Resellers)
having exchange rights.
The reconciliation of previously reported results to restated results
for the three months ended March 31, 1997 and 1996 are as follows:
<TABLE>
<CAPTION>
For the three months For the three months
ended March 31, 1997 ended March 31, 1996
------------------------------ ------------------------------
(In thousands except per share data)
Previously As Previously As
Reported Adjustment Restated Reported Adjustment Restated
---------- ---------- -------- ---------- ---------- --------
<S> <C> <C> <C> <C> <C> <C>
Revenues $6,615 $(2,630) $ 3,985 $6,061 $(1,900) $ 4,161
Gross profit 3,744 (1,901) 1,843 3,548 (1,794) 1,754
Net income (loss) 534 (2,134) (1,600) 677 (1,794) (1,117)
Basic earnings (loss) per share .06 (.23) (.17) .07 (.19) (.12)
Diluted earnings (loss) per share .06 (.23) (.17) .07 (.19) (.12)
</TABLE>
NOTE 2 - NET INCOME (LOSS) PER SHARE
Net income (loss) per share is computed on the basis of weighted average
shares and common stock equivalent shares outstanding for each period
presented, if dilutive.
In February 1997, the Financial Accounting Standards Board issued SFAS
No. 128, "Earnings per Share," which establishes standards for computing and
presenting earnings per share ("EPS"). SFAS No. 128 will be adopted by the
Company as required for the interim period and fiscal year ending December
31, 1997. Upon adoption of SFAS No. 128, the Company will present basic EPS
as well as diluted EPS in the period of adoption and restate all prior-period
EPS data presented for comparative purposes. Basic EPS will be computed by
dividing income available to common shareholders by the weighted average
number of shares of common stock outstanding. Diluted EPS will be computed
similar to basic EPS except that the weighted average number of shares of
common stock outstanding will be increased to include the number of
additional common shares that would have been outstanding if the dilutive
potential common shares had been issued. The pro forma EPS calculations
based upon SFAS No. 128 are indicated below:
5
<PAGE>
<TABLE>
<CAPTION>
For the three months
ended March 31,
------------------------
1997 1996
--------- ---------
(RESTATED)
<S> <C> <C>
Basic earnings per common share
Net loss per share $ (.17) $ (.12)
--------- ---------
--------- ---------
Weighted average shares 9,565,000 9,027,000
Diluted earnings per common share
Net loss per share $ (.17) $ (.12)
--------- ---------
--------- ---------
Weighted average shares 9,565,000 9,027,000
</TABLE>
6
<PAGE>
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 thereunto duly authorized.
ALTRIS SOFTWARE, INC.
By: /s/John W. Low
--------------------------------
John W. Low
Chief Financial Officer
Dated: May 19, 1998
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7
<PAGE>
EXHIBIT 11
ALTRIS SOFTWARE, INC.
STATEMENT RE COMPUTATION OF NET INCOME (LOSS) PER SHARE
(Unaudited)
(Restated)
<TABLE>
<CAPTION>
For the three months
ended March 31,
--------------------------
1997 1996
----------- -----------
<S> <C> <C>
Net loss per consolidated financial statements $(1,600,000) $(1,117,000)
Primary net loss per share:
Weighted average common shares 9,565,000 9,027,000
Common stock equivalents:
Common stock options - -
----------- -----------
Weighted average shares outstanding 9,565,000 9,027,000
----------- -----------
----------- -----------
Fully diluted net loss per share:
Weighted average common shares 9,565,000 9,027,000
Common stock equivalents:
Common stock options - -
----------- -----------
Weighted average shares outstanding 9,565,000 9,027,000
----------- -----------
----------- -----------
Net loss per share
Primary $ (.17) $ (.12)
----------- -----------
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Fully diluted $ (.17) $ (.12)
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</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED BALANCE SHEET AND CONSOLIDATED STATEMENT OF OPERATIONS, AS
RESTATED, FOUND ON PAGES 2 OR 3 OF THE COMPANY'S FORM 10-Q FOR THE YEAR TO DATE
MARCH 31, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<RESTATED>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 1,440
<SECURITIES> 0
<RECEIVABLES> 4,400
<ALLOWANCES> 0
<INVENTORY> 539
<CURRENT-ASSETS> 7,296
<PP&E> 7,381
<DEPRECIATION> 5,306
<TOTAL-ASSETS> 17,070
<CURRENT-LIABILITIES> 7,012
<BONDS> 0
0
0
<COMMON> 61,630
<OTHER-SE> (53,323)
<TOTAL-LIABILITY-AND-EQUITY> 17,070
<SALES> 3,985
<TOTAL-REVENUES> 3,985
<CGS> 2,142
<TOTAL-COSTS> 2,142
<OTHER-EXPENSES> 916
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (51)
<INCOME-PRETAX> (1,600)
<INCOME-TAX> 0
<INCOME-CONTINUING> (1,600)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,600)
<EPS-PRIMARY> (.17)
<EPS-DILUTED> (.17)
</TABLE>
