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 26, 2000
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GIGA INFORMATION GROUP, INC.
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)
139 Main Street
Cambridge, MA 02142
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (617) 949-4900
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(former name or former address, if changed since last report)
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Item 5. Other Events
1. Filed herewith is a copy of the Giga Information Group, Inc. (the
"Company") Press Release, dated April 26, 2000, announcing its results of
operations for the three months ended March 31, 2000. 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.
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 26, 2000
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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: April 27, 2000
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GIGA INFORMATION GROUP, INC.
FORM 8-K
CURRENT REPORT
EXHIBIT INDEX
Exhibit No. Description
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(99) Press Release, dated April 26, 2000
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EXHIBIT 99
FOR IMMEDIATE RELEASE
FOR INFORMATION CONTACT:
Investors: Media:
Karen Vahouny David Kitchen
The Poretz Group Director, Public Relations
[email protected] [email protected]
1 (703) 506-1778 1 (781) 792-2606
Giga Information Group
139 Main Street
Cambridge, MA 02142
www.gigaweb.com
1 (617) 949-4900
GIGA INFORMATION GROUP REPORTS FIRST
QUARTER FINANCIAL RESULTS
QUARTERLY NET LOSS PER SHARE CUT FROM $0.36 TO $0.24;
COMPANY ACHIEVES RECORD SALES OF $16.8 MILLION
CAMBRIDGE, Mass. (April 26, 2000) -- Giga Information Group (NASDAQ: GIGX) today
announced that revenues for the first quarter had increased 41% compared to the
same period last year, with a 40% drop in operating losses. The Company's net
loss in the first quarter of 2000 was $2.5 million, or $0.24 per share, versus
$3.6 million, or $0.36 per share, in the comparable quarter of last year.
Growth of the Company's e-Business research, advisory and consulting services
contributed to the rise in revenues from $11.9 million in the first quarter of
1999 to $16.8 million in the same quarter of 2000. The reduction in operating
losses, from $3.5 million to $2.1 million, reflects the growth in revenues, as
well as the benefit of previously implemented cost containment initiatives.
Notably, the cost of services dropped from 52% of sales in the first quarter of
1999 to 43% of sales in this year's first quarter.
According to Robert Weiler, chairman and chief executive officer of Giga
Information Group, "Both our top and bottom line performance came in ahead of
plan, and we believe we're in an excellent position to hit our goal of operating
profitability by the fourth quarter of this year."
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He adds, "Our goal remains to grow our new ePractices(TM) and Web Site
ScoreCard(TM) services, maximize our relationship with Wit Capital, and expand
the depth and breadth of our e-Business research and advisory services. At the
same time, we plan to accelerate our presence in non-U.S. markets, such as Latin
America and the Asia-Pacific regions."
The Company plans to hold an investor conference call at 10 a.m. Eastern
Daylight Time on Thursday, April 27, 2000, to discuss the first quarter
performance. The investor call will be accessible via webcast at www.vcall.com;
click on Giga under "Today's VCalls." The call will be archived for 90 days.
FIRST QUARTER HIGHLIGHTS
o Signing a two-year agreement with Wit Capital in which Giga will provide
its e-Business and technology research and analysis to supplement Wit's
financial research.
o Announcing a strategic web-based content agreement with DeepCanyon, the
first of several alliances targeted for fiscal 2000. Under this agreement,
DeepCanyon will make select Giga research available for sale through its
web offering.
o Going live with GigaWeb(R)3.0, the next generation of the Company's
on-line community for e-Business research and analysis.
o Leveraging agreements with distributors in Argentina and Brazil and hiring
an account manager to sell and support Giga's services in Mexico, as part
of the Company's expansion efforts in Latin America.
o Achieving a client retention rate of 84% compared to 72% in the same
quarter of last year.
The Company also reported that its revenue run rate at March 31, 2000, was $69.2
million versus $52.3 million at the end of the first quarter of 1999,
representing a 32% increase. Giga has defined revenue run rate as its Annualized
Value plus the previous 12 months' revenues from services not included in
Annualized Value, primarily events and Web Site ScoreCard. Annualized Value is
the cumulative annualized subscription value of Giga's advisory services and
ePractices contracts in effect at any given point in time.
ABOUT GIGA INFORMATION GROUP
Giga Information Group (NASDAQ: GIGX) provides objective research, advice and
continuous coaching on technology for e-Business. Giga's integrated suite of
offerings helps clients make strategic decisions about the technologies, people
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and processes needed to excel in the new digital economy. Emphasizing close
interaction between analysts and clients, Giga delivers support with the speed
and scope necessary for e-Business.
Giga began providing services in April 1996 and now has a global client base
encompassing more than 1,100 organizations and over 120,000 licensed users. Its
enterprise clients include companies that use, sell and 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.
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Statements that are not historical fact may be considered forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of
1995. Forward-looking statements are not statements of historical facts, but
rather reflect Giga's current expectations concerning future events and results.
Giga generally uses the words "believes", "expects", "intends", "plans",
"anticipates", "likely", "will" and similar expressions to identify
forward-looking statements. Such forward looking statements, including those
concerning Giga's expectations, involve known and unknown risks, uncertainties
and other factors, some of which are beyond Giga's control, which may cause
Giga's actual results, performance or achievements, 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 Giga, specific consideration
should be given to various factors including the following: Giga's prior losses
and anticipation of future losses; Giga's need to attract and retain qualified
personnel; Giga's dependence on sales and renewals of subscription-based
services; Giga's ability to achieve and sustain high renewal rates; Giga's
ability to manage and sustain growth; Giga's future capital needs and the risks
of working capital deficiency; Giga's dependence on key personnel; competition
from other companies including those with greater resources than Giga; the risks
associated with the development of new services and products; the potential for
significant fluctuations in quarterly operating results; continued market
acceptance of and demand for Giga services; uncertainties relating to
proprietary rights; Giga'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)
2000 1999
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<S> <C> <C>
REVENUES:
Research, advisory and consulting $ 14,766 $ 10,354
Other, principally events 2,073 1,586
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Total revenues 16,839 11,940
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COSTS AND EXPENSES:
Cost of services 7,296 6,152
Sales and marketing 7,672 6,570
Research and development 543 254
General and administrative 2,795 2,118
Depreciation and amortization 645 379
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Total costs and expenses 18,951 15,473
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LOSS FROM OPERATIONS (2,112) (3,533)
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INTEREST INCOME 107 254
INTEREST EXPENSE (23) (37)
FOREIGN EXCHANGE GAIN/(LOSS) (463) (244)
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LOSS FROM OPERATIONS BEFORE INCOME TAXES (2,491) (3,560)
INCOME TAX (BENEFIT)/CHARGE (27) 42
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NET LOSS $ (2,464) $ (3,602)
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RESULTS PER COMMON SHARE:
HISTORICAL - BASIC AND DILUTED:
NET LOSS $ (0.24) $ (0.36)
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WEIGHTED AVERAGE NUMBER OF SHARES 10,106,752 9,955,957
============= ===============
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<TABLE>
<CAPTION>
CONSOLIDATED BALANCE SHEET DATA
(IN THOUSANDS, EXCEPT SHARE DATA) MARCH 31, DECEMBER 31,
2000 1999
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<S> <C> <C>
ASSETS
Cash, cash equivalents and marketable securities $ 8,692 $ 6,182
Accounts receivable, net 13,961 21,199
Total current assets 34,057 37,529
Property and equipment, net 5,966 6,188
Total assets 40,495 44,195
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Deferred revenues $ 38,311 $ 37,817
Debt, current portion 404 527
Total current liabilities 47,773 50,012
Total liabilities 48,232 50,581
Total stockholders' equity (deficit) (7,737) (6,386)
Total liabilities and stockholders' equity (deficit) 40,495 44,195
COMMON STOCK ISSUED AND OUTSTANDING 10,159,236 10,043,401
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