Corel, who has inherited the “beleaguered” term from Apple in recent months, hopes to give up the descriptive word soon by announcing a net income of up to $0.5 million for the first quarter ended Feb. 28. That small profit comes ahead of its previously stated target of profitability by the third quarter of fiscal 2001.
Revenues for the first quarter are now expected to be approximately US$32.5 million, compared with a net loss of $12.4 million or ($0.19) per share on revenues of $44.1 million for the same period last year.
“We are pleased with these early signs of success with our new strategic direction for the company,” said Derek Burney, president and CEO of Corel, in a statement regarding the profit. “By returning the company to profitability earlier than anticipated, we are executing ahead of schedule one of the major milestones of our new growth strategy. While our revenues were lower than we expected, our positive operating cash flow and earnings make it clear our hard work is paying off.”
He added that the company is committed to executing a strategy for growth and are “squarely focused on capitalizing on both the near and longer term opportunities.” The immediate horizon includes the first major upgrade to their office suite in two years and the introduction of a “full line” of new graphics applications for the Mac and PC platforms, Burney said. Some, perhaps all of those products, will be Mac OS X compatible. Corel has already Carbonized its KnockOut masking software package for the next generation operating system, as MacCentral
reported on Feb. 10.
Cost of sales and operating expenses for this quarter are expected to be between $33 and $34 million resulting in a loss from operations of up to $1.5 million as compared to $62.8 million in costs and $18.7 million in operating losses for the same quarter last year. Interest income is expected to offset the operating loss and yield a modest net income. Final results, net of non-cash items, are also expected to demonstrate positive operating cash flow before payment of Novell obligations and other non-operating items.