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) April 28, 1999
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)
NY2:\446411\01\9KGB01!.DOC\47954.0001
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Item 5. Other Events
Filed herewith is a copy of the Giga Information Group, Inc.
(the "Company") Press Release, dated April 28, 1999, announcing its results of
operations for the three months ended March 31, 1999. 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
(a) Financial Statements of business acquired:
Not applicable.
(b) Pro Forma financial information:
Not applicable.
(c) Exhibit:
(99) Press Release, dated April 28, 1999
2
<PAGE>
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
------------------------------------
Daniel M. Clarke
Senior Vice President and
Chief Financial Officer
Date: April 30, 1999
3
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GIGA INFORMATION GROUP, INC.
FORM 8-K
CURRENT REPORT
EXHIBIT INDEX
Exhibit No. Description
- ----------- -----------
(99) Press Release, dated April 28, 1999
4
FOR IMMEDIATE RELEASE
FOR INFORMATION CONTACT:
DANIEL M. CLARKE
Chief Financial Officer
Giga Information Group
One Longwater Circle
Norwell, Massachusetts 02061
1 (781) 982-9500
Fax: 1 (781) 871-4098
[email protected]
GIGA INFORMATION GROUP REPORTS FIRST QUARTER RESULTS
TOTAL REVENUES UP 40 PERCENT; CONTINUOUS INFORMATION SERVICES REVENUES
UP 52 PERCENT; ANNUALIZED VALUE INCREASES 54 PERCENT
CAMBRIDGE, Mass. (April 28, 1999) -- Giga Information Group, Inc. (NASDAQ: GIGX)
today announced that revenues for the first quarter ended March 31, 1999
increased 40 percent to $11.9 million from $8.6 million in the same period of
1998. Revenues from continuous information services for the first quarter of
1999 increased 52 percent to $10.4 million from $6.8 million in the same period
last year. The net loss for the first quarter of 1999 decreased to $3.6 million,
or $0.36 per share, from $3.8 million, or $1.81 per share, in the first quarter
of 1998.
Annualized Value* at March 31, 1999 was $45.5 million versus $29.5 million at
March 31, 1998, representing a 54 percent increase year-over-year.
"While results in the first quarter of 1999 reflect some slowing in revenue and
AV growth, the likelihood of which we have previously discussed, our absolute
growth was strong," said Gideon I. Gartner, Chairman and CEO. "We remain
cautiously optimistic that, after this year of transition for Giga and its
industry sector, we will continue to outperform the sector. The first quarter
was impacted by the reorganization of Giga's sales force, a slowdown in sales of
its Y2K
(more)
<PAGE>
Giga Information Group Announces First Quarter 1999 Results 2-2-2
offering, and continuing competitive pressure, which I believe is affecting all
the major advisory companies. We are making good progress in the search for a
new company CEO."
ABOUT GIGA INFORMATION GROUP
Giga Information Group, founded by industry leader Gideon I. Gartner, delivers
technology and management advice to IT decision-makers via innovative research
processes and a leading-edge Web interface. Giga's research focus is on helping
companies integrate their businesses with the Internet; it also covers issues
pertaining to the computing, telecommunications and related industries. Giga
began providing its services in April 1996, and now has a global client base
exceeding 950 organizations and over 14,000 individuals. Its enterprise clients
include IT decision-makers who sell technology, who use technology, and who
invest in technology.
Headquartered in Cambridge, Massachusetts, Giga has 10 other offices covering
the Americas and Europe. Giga is also represented by distributors in other areas
of the world. The Company's Web site can be accessed at http://www.gigaweb.com.
The Company's logo with the name "Giga Information Group" is a registered
trademark of Giga Information Group, Inc.
*The Company defines Annualized Value as the cumulative annualized subscription
value of the Company's continuous information services contracts in effect at
any given point in time.
# # #
Statements that are not historical fact may be considered forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of
1995. Such forward looking statements, including those concerning the Company's
expectations, involve known and unknown risks, uncertainties and other factors
which may cause the actual results, performance or achievements of the Company,
or industry results, to be materially different from any future results,
performance, or achievements expressed or implied by such forward looking
statements. In evaluating such statements as well as the future prospects of the
Company, specific consideration should be given to various factors including the
following: the Company's prior losses and anticipation of future losses; the
Company's need to attract and retain qualified personnel; the Company's
dependence on sales and renewals of subscription-based services; the Company's
ability to achieve and sustain high renewal rates; the Company's ability to
manage and sustain growth; the Company's future capital needs and the risks of
working capital deficiency; the Company's dependence on key personnel;
competition; the risks associated with the development of new services and
products; the potential for significant fluctuations in quarterly operating
results; continued market acceptance and demand for Giga services; uncertainties
relating to proprietary rights; the Company's dependence on the Internet
infrastructure; the risk of system failure; the risks related to content; the
risks associated with international operations; 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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GIGA INFORMATION GROUP, INC.
<TABLE>
<CAPTION>
CONSOLIDATED OPERATING RESULTS
(IN THOUSANDS, EXCEPT SHARE AND QUARTER ENDED MARCH 31,
PER SHARE DATA) ---------------------------------
(UNAUDITED) %
1999 1998 CHANGE
----------- ----------- --------
<S> <C> <C> <C>
REVENUES:
Continuous Information Services $ 10,354 $ 6,804 52%
Other, principally events 1,586 1,748 -9%
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Total revenues 11,940 8,552 40%
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COSTS AND EXPENSES:
Cost of services 5,940 4,462 33%
Sales and marketing 6,782 5,781 17%
Research and development 254 339 -25%
General and administrative 2,118 1,352 57%
Depreciation and amortization 379 385 -2%
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Total costs and expenses 15,473 12,319 26%
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LOSS FROM OPERATIONS (3,533) (3,767) -6%
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INTEREST INCOME 254 37 n.a.
INTEREST EXPENSE (37) (86) -57%
FOREIGN EXCHANGE GAIN/(LOSS) (244) (16) n.a.
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LOSS FROM OPERATIONS BEFORE INCOME TAXES (3,560) (3,832) -7%
INCOME TAX (BENEFIT) CHARGE 42 4 n.a.
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NET LOSS $ (3,602) $ (3,836) -6%
=========== ===========
RESULTS PER COMMON SHARE:
HISTORICAL - BASIC AND DILUTED:
NET LOSS $ (0.36) $ (1.81) -80%
=========== ===========
WEIGHTED AVERAGE NUMBER OF SHARES (NOTE 1.) 9,955,957 2,115,837 n.a.
=========== ===========
</TABLE>
GIGA INFORMATION GROUP, INC.
NOTES TO CONSOLIDATED OPERATING RESULTS
NOTE 1. COMPONENTS OF WEIGHTED AVERAGE COMMON SHARES:
<TABLE>
<CAPTION>
QUARTER ENDED QUARTER ENDED
MARCH 31, 1999 MARCH 31, 1998
------------------------ -------------------------
Weighted Weighted
Actual Average Actual Average
----------- ----------- ------------ -----------
<S> <C> <C> <C> <C>
Shares issued and outstanding at beginning of period 9,943,502 9,943,502 2,093,107 2,093,107
Shares issued from exercise of warrants 12,666 7,681 - -
Shares issued from exercise of stock options 13,268 4,774 31,035 22,730
----------- ----------- ------------ -----------
Total (a) 9,969,436 9,955,957 2,124,142 2,115,837
=========== =========== ============ ===========
</TABLE>
(a) Historic amounts reported for actual and weighted average outstanding
shares for March 31, 1998 are not inclusive of 3,000,000 shares issued
pursuant to the Company's Initial Public Offering of Common Stock in
July 1998 and conversion of all of the Company's outstanding Preferred
Stock into 4,686,784 shares of Common Stock upon closing of the offering
in August 1998.
<PAGE>
GIGA INFORMATION GROUP, INC.
<TABLE>
<CAPTION>
CONSOLIDATED BALANCE SHEET DATA
(IN THOUSANDS, EXCEPT SHARE DATA) MARCH 31, DECEMBER 31,
1999 1998
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<S> <C> <C>
ASSETS
Cash, cash equivalents and marketable securities $ 20,160 $ 21,057
Accounts receivable, net 9,296 15,017
Total current assets 38,833 45,591
Property and equipment, net 4,170 3,430
Total assets 43,194 49,213
LIABILITIES AND STOCKHOLDERS' EQUITY
Deferred revenues $ 27,978 $ 29,470
Debt, current portion 481 461
Total current liabilities 36,407 39,363
Total liabilities 36,723 39,807
Total stockholders' equity 6,471 9,406
Total liabilities and stockholders' equity 43,194 49,213
COMMON STOCK ISSUED AND OUTSTANDING 9,969,436 9,943,502
</TABLE>
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