Houseplans(TM) Business Driven by 21% Organic Growth and
Acquisition of globalHouseplans.com NOVATO, Calif., Feb. 14
/PRNewswire-FirstCall/ -- IMSI(R) (OTC:IMSI) (BULLETIN BOARD: IMSI)
, a leading provider of house plans online and a leading developer
and publisher of precision design, and consumer and business
software solutions, today announced its financial results for the
second fiscal quarter ended December 31, 2005. For the three months
ended December 31, 2005, IMSI reported net income of $121,000, or
($0.00) per share on net revenues of $3.7 million. Net revenues
increased by 69% in the Houseplans(TM) business and 7% overall, as
compared to the previous fiscal year, reflecting primarily
continued growth in the Houseplans(TM) business. The following are
highlights for the three months ended December 31, 2005: -- Net
income of $121,000. -- Growth in Houseplans(TM) was 69 % and 114%
for the three and six months, and 21% and 47% for the three and six
months without the acquisition of globalHouseplans.com. --
Houseplans(TM) gross margins improved to 64% from 54% as compared
to the previous fiscal year. -- International net revenue increased
48% driven by globalHouseplans.com. Non GAAP Information -- GAAP
net income (loss) when adjusted for certain non-cash activity and
taxes to "EBITDA" was a positive $603,000 for the quarter year.
"The Houseplans(TM) business acquired globalhouseplans.com in July
and has met our expectations to date for the sale of stock house
plans. We now have over 21,000 stock house plans, the largest
collection of exceptional house plans online, selling on 3 major
sites," said Martin Wade III, Chief Executive Officer. "Our balance
sheet continues to be strong $9.8 million in cash and cash
equivalents and without any call upon our resources by our
prospective partner AccessMedia under the joint operating
agreement," continued Mr. Wade. "We cannot include approximately
$1.2 million in escrow from the sale of Allume in July but we have
an expectation that these funds will eventually be released over
the coming year according to the terms of the sale agreement. The
sale of Smith Micro stock received in the Allume sale contributed a
realized gain of $923,000 during the quarter, and this was over and
above the initial sale price." IMSI will have an earnings call on
Tuesday, February 14, 2006, at 4:00 p.m. Eastern Time (1:00 p.m.
Pacific Time). The public may participate in this event by calling
877-704-5386. Individuals are also invited to listen to the
conference call, which will be broadcast live over the Internet
beginning Tuesday, February 14, 2006, at 4:00 p.m. Eastern Time. To
listen to the call live over the Internet, simply visit
http://www.imsisoft.com/ and select the earnings call icon. In
addition to disclosing results determined in accordance with
generally accepted accounting principles (GAAP), IMSI also
discloses non-GAAP results of operations that exclude certain
items. By disclosing this non-GAAP information, management intends
to provide investors with additional information to further analyze
the company's performance, core results and underlying trends.
Management utilizes a measure of net income on a non-GAAP basis
that excludes certain charges to better assess operating
performance. Non-GAAP information is not determined using GAAP;
therefore, the information is not necessarily comparable to other
companies and should not be used to compare the company's
performance over different periods. Non-GAAP information should not
be viewed as a substitute for, or superior to, net income or other
data prepared in accordance with GAAP as measures of our
profitability or liquidity. Users of this financial information
should consider the types of events and transactions for which
adjustments have been made. See the following table for a
reconciliation of this non-GAAP amount to amounts reported under
GAAP. EBITDA Analysis (In thousands) FY 2005 FY 2006 Q1 Q2 Q1 Q2
Net (Loss) Income - the GAAP measure ($275) $129 ($1,952) $122
Interest paid 70 55 123 21 Taxes 5 3 -- 39 Depreciation &
Amortization 262 303 356 422 EBITDA - Non-GAAP $62 $490 ($1,473)
$604 Notes on components of Net (Loss) Income related to
transactions Income from the sale of Discontinued Operations 285
159 0 0 Gain from the sale of Discontinued Operations 53 0 (843)
369 INTERNATIONAL MICROCOMPUTER SOFTWARE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands, except share
amounts) December 31, June 30, 2005 2005 Unaudited ASSETS Current
assets: Cash and cash equivalents $9,849 $4,347 Trading securities
-- 714 Receivables, less allowances for doubtful accounts,
discounts and returns of $551 as of December 31, 2005 and $626 as
of June 30, 2005. 1,384 773 Inventories, net 873 758 Receivables,
other (related to discontinued operations) -- 2,000 Receivables,
other - 30 Other current assets 1,278 530 Assets related to
discontinued operations -- 12,231 Total current assets 13,384
21,383 Fixed assets, net 340 377 Intangible assets Capitalized
software, net 322 494 Domain names and brands, net 1,960 1,574
Distribution rights and proprietary plans, net 773 170 Capitalized
customer lists, agreements and relationships, net 1,327 326
Goodwill 3,678 2,090 Trademarks, net 19 1 Total intangible assets
8,079 4,655 Total assets $21,803 $26,415 LIABILITIES AND
SHAREHOLDERS' EQUITY Current liabilities: Short-term debt 873 2,764
Trade accounts payable 1,364 2,245 Accrued and other liabilities
1,577 1,871 Deferred revenues 45 38 Liabilities related to
discontinued operations -- 1,037 Total current liabilities 3,859
7,955 Long-term debt and other obligations 173 230 Total
liabilities 4,032 8,185 Shareholders' equity Common stock, no par
value; 300,000,000 authorized; 29,845,877 Issued and outstanding as
of December 31, 2005 and 28,796,886 issued and outstanding as of
June 30, 2005 44,843 43,663 Accumulated deficit (27,161) (25,331)
Accumulated other comprehensive income (loss) 89 (102) Total
shareholders' equity 17,771 18,230 Total liabilities and
shareholders' equity $21,803 $26,415 INTERNATIONAL MICROCOMPUTER
SOFTWARE, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS
OF OPERATIONS and COMPREHENSIVE INCOME / (LOSS) (In thousands,
except per share amounts) (Unaudited) Three months ended Six months
ended December 31, December 31, 2005 2004 2005 2004 Net revenues
$3,719 $3,478 $7,684 $6,613 Product costs 1,328 1,122 2,783 2,143
Gross margin 2,391 2,356 4,901 4,470 Costs and expenses Sales and
marketing 1,658 1,538 3,189 2,888 General and administrative 1,329
982 2,754 1,841 Research and development 553 368 988 837 Total
operating expenses 3,540 2,888 6,931 5,566 Operating loss (1,149)
(532) (2,030) (1,096) Other income (expense) Interest and other,
net 17 33 (52) 39 Realized / unrealized gain on securities 923 471
765 422 Loss before income tax (209) (28) (1,317) (635) Income tax
provision (39) (2) (39) (8) Loss from continuing operations (248)
(30) (1,356) (643) Income from discontinued operations, net of
income tax -- 159 -- 444 Gain (loss) from the sale of discontinued
operations, net of income tax 369 -- (474) 53 Net income (loss)
$121 $129 ($1,830) ($146) Other comprehensive income (loss)
Unrealized loss on restricted securities (478) -- -- -- Foreign
currency translation adjustments 2 (24) 191 (34) Comprehensive
income (loss) ($355) $105 ($1,639) ($180) Basic earnings (loss) per
share: Loss from continuing operations ($0.01) $0.00 ($0.05)
($0.02) Income from discontinued Operations, net of income tax
$0.00 $0.01 $0.00 $0.02 Gain (loss) from the sale of discontinued
Operations, net of income tax $0.01 $0.00 ($0.02) $0.00 Net income
(loss) $0.00 $0.00 ($0.06) ($0.01) Diluted earnings (loss) per
share: Loss from continuing operations ($0.01) $0.00 ($0.05)
($0.02) Income from discontinued operations, net of income tax
$0.00 $0.01 $0.00 $0.02 Gain (loss) from the sale of discontinued
operations, net of income tax $0.01 $0.00 ($0.02) $0.00 Net income
(loss) $0.00 $0.00 ($0.06) ($0.01) Shares used in computing basic
earnings (loss) per share 29,821 27,196 29,755 27,605 Shares used
in computing diluted earnings (loss) per share 31,831 29,885 29,755
27,605 INTERNATIONAL MICROCOMPUTER SOFTWARE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY Six
months ended December 31, 2005 (In thousands, except share amounts)
(Unaudited) Common Stock Shares Amount Accumulated Accumulated
Total deficit other comprehensive income (loss) Balance at July 1,
2005 28,796,886 $43,663 ($25,331) ($102) $18,230 Issuance of common
stock related to: Stock options exercised 85,291 73 73 Warrants
exercised 117,117 -- -- Acquisitions 826,583 1,021 1,021 Finder's
fee related to acquisition 20,000 25 25 Issuance of stock options
related to: Consulting services rendered 21 21 Issuance of warrants
related to: Acquisitions 6 6 Procurement of short-term debt 68 68
Accrual of stock buy-back (30) (30) Issuance of stock options 2 2
Variable accounting adjustment (6) (6) Net loss (1,830) (1,830)
Foreign currency translation adjustment 191 191 Balance at December
31, 2005 29,845,877 $44,843 ($27,161) $89 $17,771 INTERNATIONAL
MICROCOMPUTER SOFTWARE, INC. AND SUBSIDIARIES CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) (Unaudited)
Six months ended December 31, 2005 2004 Cash flows from operating
activities: Net cash provided by (used in) operating activities
($753) $248 Cash flows from investing activities: Proceeds from
sale of discontinued operations 9,466 650 Proceeds from sale of
product line -- 258 Acquisition of subsidiaries (1,807) (1,356)
Acquisition of software development, domain names and trademarks --
(600) Purchases of equipment and software (29) (163) Transfer cash
to escrow for Jupitermedia -- (499) Proceeds from the sale of
marketable securities 1,524 1,780 Other (8) 25 Cash provided by
discontinued operations in investing activities -- 464 Net cash
provided by investing activities 9,146 559 Cash flows from
financing activities: Proceeds from borrowings 850 400 Repayments
of notes (3,802) (1,730) Proceeds from warrants and options
exercised 73 137 Cash provided by discontinued operations in
financing activities -- 12 Net cash used in financing activities
(2,879) (1,181) Effect of exchange rate change on cash and cash
equivalents (12) (34) Net increase (decrease) in cash and cash
equivalents 5,502 (408) Cash and cash equivalents at beginning of
period 4,347 3,212 Cash and cash equivalents at end of the period
$9,849 $2,804 Six months ended December 31, 2005 2004 SUPPLEMENTAL
DISCLOSURE OF CASH FLOW INFORMATION Interest paid 128 125
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING
ACTIVITIES Capital stock issued in conjunction with acquisitions
1,046 1,602 Warrants issued in conjunction with acquisitions 6 --
Notes payable incurred in conjunction with acquisitions 1,000 505
Warrants issued in conjunction with short-term debt 68 -- About
IMSI Founded in 1982, IMSI has established a tradition of providing
the professional and home user with innovative technology and
easy-to-use, high-quality software products at affordable prices.
Anchored by IMSI's flagship product, TurboCAD(R)
(http://www.turbocad.com/), the company continues to be a leading
developer and distributor of precision design and consumer software
solutions. IMSI also owns and operates Houseplans(TM)
(http://www.houseplans.com/), focused on expanding its network of
Web properties to serve the rapidly growing market for the sale of
stock house plans on-line and related home building services. More
information about IMSI can be found at http://www.imsisoft.com/.
When will a Proxy on the proposed IMSI -- AccessMedia Transaction
be available? In connection with the merger of International
Microcomputer Software, Inc. ("IMSI") and AccessMedia Networks,
Inc. ("AccessMedia"), IMSI will file a proxy statement for IMSI's
special stockholder meeting with the Securities and Exchange
Commission. Investors and security holders are advised to read the
proxy statement when it becomes available because it will contain
important information about the proposed merger. Investors and
security holders may obtain a free copy of the proxy statement
(when available) and other documents filed by IMSI with the
Securities and Exchange Commission at the Securities and Exchange
Commission's web site at http://www.sec.gov/ . Free copies of the
proxy statement (when available) and other documents filed by IMSI
with the Securities and Exchange Commission may also be obtained
from IMSI by directing a request to Investor Relations at IMSI
(telephone (415-878-4000). IMSI and its directors and its executive
officers may be deemed, under SEC rules, to be soliciting proxies
from IMSI's stockholders in favor of the proposed merger.
Information regarding the identity of these persons, and their
interests in the solicitation, will be set forth in a Schedule 14A
to be filed with the SEC, and will be available free of charge at
the SEC website and public reference rooms, and from the IMSI
corporate secretary. Safe Harbor Statement This announcement
contains forward-looking statements within the meaning of Section
27A of the Securities Act of 1933, Section 21E of the Securities
Exchange Act of 1934, and within the meaning of the Private
Securities Litigation Reform Act of 1995. Actual results could
differ materially from those projected in the forward-looking
statements as a result of various factors including the ability of
the company to successfully commercialize its new technologies as
well as risk factors set forth from time to time in the Form 10-KSB
for the period ended June 30, 2005 and other company's reports
filed with the Securities and Exchange Commission. The company
undertakes no obligation to publicly release the result of any
revisions to these forward-looking statements, which may be made to
reflect events or circumstances after the date hereof or to reflect
the occurrence of unanticipated events. DATASOURCE: International
Microcomputer Software, Inc. CONTACT: Robert O'Callahan, Chief
Financial Officer of International Microcomputer Software, Inc.,
+1-415-878-4020, or Web site: http://www.imsisoft.com/
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