<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, 1996
[ ] 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)
ALPHAREL, INC.
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(Former name of registrant)
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 May 2, 1996: 18,277,886
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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, 1996.
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, 1996, as
amended by the Form 10-K/A filed concurrently herewith, for a discussion of the
financial condition and results of operations of the Company at and for the year
ended December 31, 1996.
1
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ALTRIS SOFTWARE, INC.
PART I. FINANCIAL INFORMATION
All per share information does not reflect the effects of one-for-two
reverse stock split by the Company on October 25, 1996.
CONSOLIDATED BALANCE SHEET
<TABLE>
<CAPTION>
March 31, 1996 December 31, 1995
-------------- -----------------
(Unaudited)
(Restated)
ASSETS
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 1,074,000 $ 4,656,000
Short term investments 90,000 270,000
Receivables, net 3,741,000 4,207,000
Inventory, net 524,000 469,000
Other current assets 852,000 803,000
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Total current assets 6,281,000 10,405,000
Property and equipment, net 1,613,000 1,645,000
Computer software, net 1,477,000 1,549,000
Goodwill 4,763,000 4,945,000
Deposits and other assets 435,000 458,000
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$ 14,569,000 $ 19,002,000
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<CAPTION>
LIABILITIES AND SHAREHOLDERS' EQUITY
<S> <C> <C>
Current liabilities:
Accounts payable $ 2,317,000 $ 2,192,000
Accrued liabilities 1,720,000 3,211,000
Notes payable 200,000 1,834,000
Convertible note payable - 1,000,000
Deferred revenue 850,000 1,229,000
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Total current liabilities 5,087,000 9,466,000
Long term note payable 435,000 475,000
Other long term liabilities 822,000 945,000
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Total liabilities 6,344,000 10,886,000
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Commitments
Shareholders' equity:
Preferred stock, $1 par value,
1,000,000 shares authorized; 650,761 designated;
172,500 shares issued and outstanding - 3,306,000
Common stock, no par value, 20,000,000 shares authorized;
18,134,886 and 16,950,902 issued and outstanding,
respectively 58,601,000 54,085,000
Foreign currency translation adjustment 16,000 -
Accumulated deficit (50,392,000) (49,275,000)
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Total shareholders' equity 8,225,000 8,116,000
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$ 14,569,000 $ 19,002,000
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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)
<TABLE>
<CAPTION>
For the three months
ended March 31,
-----------------------
1996 1995
---- ----
(Restated)
<S> <C> <C>
Revenues $ 4,161,000 $ 3,151,000
Cost of revenues 2,407,000 1,692,000
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Gross profit 1,754,000 1,459,000
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Operating expenses:
Research and development 907,000 225,000
Marketing and sales 1,253,000 693,000
General and administrative 711,000 322,000
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Total operating expenses 2,871,000 1,240,000
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(Loss) income from operations (1,117,000) 219,000
Interest and other income 26,000 34,000
Interest and other expense (26,000) (28,000)
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(Loss) income before taxes (1,117,000) 225,000
Provision for taxes - -
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Net (loss) income $(1,117,000) $ 225,000
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Net (loss) income per share $ (0.06) $ .02
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Weighted average shares outstanding 18,053,000 14,065,000
</TABLE>
See accompanying notes to the consolidated financial statements
3
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ALTRIS SOFTWARE, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
For the three months
ended March 31,
--------------------------------
1996 1995
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(Restated)
<S> <C> <C>
Cash flow from operating activities:
Net (loss ) income $ (1,117,000) $ 225,000
Adjustments to reconcile net (loss) income to
net cash used by operating activities:
Depreciation and amortization 530,000 164,000
Changes in assets and liabilities:
Receivables 466,000 521,000
Inventory (55,000) 200,000
Other assets 163,000 (22,000)
Accounts payable 125,000 (113,000)
Accrued liabilities (1,491,000) (37,000)
Deferred revenue (379,000) (92,000)
Other long term liabilities (123,000) -
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Net cash (used in) provided by operating activities (1,881,000) 846,000
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Cash flows from investing activities:
Short term investments maturing 180,000 392,000
Purchases of property and equipment (192,000) (77,000)
Purchases of software (15,000) (9,000)
Computer software capitalized (226,000) (179,000)
Cash paid to former Optigraphics shareholders - (169,000)
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Net cash used in investing activities (253,000) (42,000)
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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) -
Principal payments under note payable (40,000) (14,000)
Proceeds from exercise of stock options 210,000 -
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Net cash used in financing activities (1,464,000) (14,000)
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Effect of exchange rate changes on cash 16,000 -
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Net increase (decrease) in cash and cash equivalents (3,582,000) 790,000
Cash and cash equivalents at beginning of period 4,656,000 1,036,000
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Cash and cash equivalents at end of period $ 1,074,000 $ 1,826,000
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Supplemental cash flow information:
Interest paid $ 25,000 $ 36,000
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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.
(formerly Alpharel, Inc.) (the "Company") as of March 31, 1996 and the
consolidated statement of operations and of cash flows for the three month
periods ended March 31, 1996 and 1995 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 intercompany accounts and transactions
have been eliminated.
These consolidated financial statements should be read in conjunction with
the financial statements included in the Company's Annual Report on Form 10-K,
as amended, for the year ended December 31, 1996, as filed with the Securities
and Exchange Commission.
The financial statements included herein have been restated from those
previously published to reflect corrections of misapplications of the
Company's revenue recognition policies. The results for the quarter ended
March 31, 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; or (c) there was sufficient
evidence of the delivery of the product or services.
The reconciliation of previously reported results to restated results for
the three months ended March 31, 1996 is as follows:
<TABLE>
<CAPTION>
For the three months
ended March 31, 1996
--------------------------------------
(In thousands except per share data)
Previously
Reported Adjustment As Restated
------------ ---------- -----------
<S> <C> <C> <C>
Revenues $ 6,061 $ (1,900) $ 4,161
Gross profit 3,548 (1,794) 1,754
Net income (loss) 677 (1,794) (1,117)
Net income (loss) per share 0.04 (0.10) (0.06)
</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.
5
<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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6
<PAGE>
EXHIBIT 11
ALTRIS SOFTWARE, INC.
STATEMENT RE COMPUTATION OF NET INCOME (LOSS) PER SHARE
(Unaudited)
<TABLE>
<CAPTION>
For the three months
ended March 31,
------------------------------
1996 1995
---- ----
(Restated)
<S> <C> <C>
Net (loss) income per consolidated financial statements $ (1,117,000) $ 225,000
Primary net (loss) income per share:
Weighted average common shares 18,053,000 13,741,000
Common stock equivalents:
Common stock options - 324,000
Common stock warrants - -
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Weighted average shares outstanding 18,053,000 14,065,000
------------ -----------
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Fully diluted net (loss) income per share:
Weighted average common shares 18,053,000 13,741,000
Common stock equivalents:
Common stock options - 324,000
Common stock warrants - -
------------ -----------
Weighted average shares outstanding 18,053,000 14,065,000
------------ -----------
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Net (loss) income per share:
Primary $ (0.06) $ .02
------------ -----------
------------ -----------
Fully diluted $ (0.06) $ .02
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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 AND 3 OF THE COMPANY'S FORM 10Q FOR THE YEAR TO DATE
MARCH 31, 1996 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-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> MAR-31-1996
<CASH> 1,074
<SECURITIES> 0
<RECEIVABLES> 3,741
<ALLOWANCES> 0
<INVENTORY> 524
<CURRENT-ASSETS> 6,281
<PP&E> 6,247
<DEPRECIATION> 4,634
<TOTAL-ASSETS> 14,569
<CURRENT-LIABILITIES> 5,087
<BONDS> 0
0
0
<COMMON> 58,601
<OTHER-SE> (50,392)
<TOTAL-LIABILITY-AND-EQUITY> 8,225
<SALES> 4,161
<TOTAL-REVENUES> 4,161
<CGS> 2,407
<TOTAL-COSTS> 2,407
<OTHER-EXPENSES> 907
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (26)
<INCOME-PRETAX> (1,117)
<INCOME-TAX> 0
<INCOME-CONTINUING> (1,117)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,117)
<EPS-PRIMARY> (.06)
<EPS-DILUTED> (.06)
</TABLE>
