SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) August 13, 1998
GIGA INFORMATION GROUP, INC.
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Exact name of registrant as specified in its charter
Delaware File No. 0-21529 06-1422860
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(State or other (Commission (I.R.S. Employer
jurisdiction or File Identification
organization) Number) Number)
One Longwater Circle,
Norwell, MA 02061
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (781) 982-9500
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Not Applicable
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(former name or former address, if changed since last report)
NYFS07...:\54\47954\0001\21\FRM8128R.050
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Item 5. Other Events
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Filed herewith is a copy of the Giga Information Group, Inc. (the
"Company") Press Release, dated August 13, 1998, announcing its results of
operations for the three and six months ended June 30, 1998. All normal
recurring adjustments that are, in the opinion of management, necessary for a
fair presentation of the results of operations for the periods presented have
been included. The nature of the Company's business is such that the results for
any interim period are not necessarily indicative of the results for an entire
fiscal year or any other interim period.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
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(a) Financial Statements of business acquired:
Not applicable.
(b) Pro Forma financial information:
Not applicable.
(c) Exhibit:
(99) Press Release, dated August 13, 1998
2
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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.
GIGA INFORMATION GROUP, INC.
By: /s/ Daniel M. Clarke
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Daniel M. Clarke
Senior Vice President and
Chief Financial Officer
Date: August 13, 1998
3
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GIGA INFORMATION GROUP, INC.
FORM 8-K
CURRENT REPORT
EXHIBIT INDEX
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Exhibit No. Description
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(99) Press Release, dated August 13, 1998
4
Giga
Information Group
For Immediate Release
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FOR INVESTOR INFORMATION CONTACT:
Daniel M. Clarke, Chief Financial Officer
Phone: 1 (781) 982-9500
Fax: 1 (781) 871-4098
Email: [email protected]
Giga Announces Second Quarter Results
Revenues increase 110%; Annualized Value up 128%
CAMBRIDGE, MASS. - August 13, 1998 - Giga Information Group, Inc. (NASDAQ: GIGX)
announced today that revenues for the second quarter ended June 30, 1998
increased 110% to $9.1 million from $4.3 million in the same period of 1997. The
net loss for the second quarter of 1998 decreased to $5.6 million from $6.8
million in the second quarter of 1997. The pro forma diluted loss per share
decreased to $0.82 per share from $1.01 per share in the second quarter of 1997.
Revenues for the six months ended June 30, 1998 increased 111% to $17.7 million
from $8.4 million in the same six-month period of 1997. The net loss for the six
months ended June 30, 1998 decreased to $9.5 million from $12.5 million in the
same period last year. The pro forma diluted loss per share decreased to $1.38
for the six months ended June 30, 1998 from $1.85 in the same six-month period
of 1997.
Annualized Value at June 30, 1998, was $33.3 million, representing a 128%
increase from $14.6 million at June 30, 1997. The Company defines Annualized
Value as the cumulative annualized subscription value of the Company's
Continuous Information Services agreements in effect at any given point in time
without regard to commencement date, duration, or risk of cancellation.
Giga Information Group, headquartered in Cambridge, Massachusetts, sells
knowledge which supports enterprise decision making in the field of Information
Technology ("IT") with a focus on computing, telecommunications and related
industries. Giga began providing its services in April 1996, and today, its
global client base exceeds 840 organizations including IT vendors, enterprise
users of IT products and services and institutional investors. Additional
information about Giga Information Group can be found on the Company's website:
www.gigaweb.com.
The Company's consolidated operating results are attached.
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Statements that are not historical fact may be considered forward-looking
statements (as defined in the Private Securities Litigation Reform Act of 1995)
that involve risks and uncertainties. Consequently, actual events or results may
differ materially from those expressed or implied by those set forth in such
forward-looking statements. Factors that could cause actual results to differ
materially include, but are not limited to, the Company's ability to attract and
retain highly skilled and experienced employees, ability to secure subscriptions
to its services and to achieve and sustain high renewal rates, ability to
effectively manage growth, ability to understand and anticipate market trends
and develop and offer new products and services, significant competition from
existing and new competitors, potential fluctuations in quarterly operating
results, dependence on Internet infrastructure for access to GigaWeb and other
risks as detailed from time-to- time in the Company's filings with the
Securities and Exchange Commission. The Company undertakes no obligation to
update any forward-looking statements as a result of new information,
unanticipated events, or otherwise.
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<TABLE>
<CAPTION>
Giga Information Group, Inc.
CONSOLIDATED OPERATING RESULTS
(unaudited, in thousands, except per share data) Quarter Ended June 30, Six Months Ended June 30,
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% %
1998 1997 Change 1998 1997 Change
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<S> <C> <C> <C> <C> <C> <C>
Revenues:
Continuous Information Services $ 7,604 $ 3,234 135% $ 14,408 $ 5,804 148%
Other, principally events 1,508 1,110 36% 3,256 2,566 27%
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Total revenues 9,112 4,344 110% 17,664 8,370 111%
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Costs and expenses:
Cost of services 5,231 3,389 54% 9,693 6,666 45%
Sales and marketing 6,538 5,295 23% 12,319 9,453 30%
Research and development 299 588 -49% 638 1,247 -49%
General and administrative 1,678 1,461 15% 3,046 2,522 21%
Depreciation and amortization 414 471 -12% 799 1,105 -28%
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Total costs and expenses 14,160 11,204 26% 26,495 20,993 26%
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Loss from operations (5,048) (6,860) -26% (8,831) (12,623) -30%
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Interest income 122 77 59% 159 175 -9%
Interest expense (694) (24) 2793% (780) (41) 1803%
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Loss from operations before income taxes (5,620) (6,807) -17% (9,452) (12,489) -24%
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Income tax (benefit) charge (4) 4 -200% - 11 -100%
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Net loss $ (5,616) $ (6,811) -18% $ (9,452) $ (12,500) -24%
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Net loss per common share - historical
basic and diluted (1) $ (2.60) $ (3.28) -21% $ (4.42) $ (6.06) -27%
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Net loss per common share - pro forma
basic and diluted (1) (2) $ (0.82) $ (1.01) -19% $ (1.38) $ (1.85) -25%
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Weighted average number of shares - historical (1) 2,161,542 2,075,628 4% 2,138,815 2,063,457 4%
========== ========== ====== =========== ==========
Weighted average number of shares - pro forma (1)(2) 6,848,326 6,762,412 1% 6,825,599 6,750,241 1%
========== ========== ====== =========== ==========
</TABLE>
(1) Restated to give effect to a 1 for 3 reverse stock split of the Common
Stock effective July 29, 1998. Does not include 3,000,000 shares issued
pursuant to an Initial Public Offering of Common Stock completed on August
4, 1998. Common equivalent shares resulting from the assumed exercise of
outstanding stock options and warrants have been excluded from the
computation of diluted loss per share as their effect would be
anti-dilutive. Options to purchase 1,278,977 and 1,129,815 shares of Common
Stock and warrants to purchase 857,056 and 35,959 shares of Common Stock
were outstanding at June 30, 1998 and 1997, respectively.
(2) Reflects the conversion of all outstanding shares of Convertible Preferred
Stock into 4,686,784 shares of Common Stock upon the the completion of the
aforementioned Initial Public Offering of Common Stock.
