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NEWS RELEASE
CENTRINITY REPORTS PRELIMINARY SECOND QUARTER FINANCIAL RESULTS FOR FISCAL 2002
Company increases revenue and lowers net loss
RICHMOND HILL, ON CANADA, April 16, 2002 - Centrinity Inc. (CTI: TSE), the developers of the FirstClass Communications Platform, today announced that its revenue for the second quarter ended March 31, 2002 is expected to be approximately $4.8 million, as compared to $4.0 million in the same quarter last year and $4.3 million in the first quarter of Fiscal 2002, representing increases of 20% and 12% respectively. Revenue for the six month period ended March 31, 2002 is expected to be approximately $9.1 million as compared to $8.6 million, for the same period in the prior year. All figures are unaudited and are in Canadian dollars.
Revenue in the second quarter from enterprise customers was $4.2 million as compared to $4.0 million in the second quarter of Fiscal 2001 with the growth being due to increased sales of Unified Communications. Revenue from service providers was approximately $0.6 million as compared to $50,000 in the second quarter of Fiscal 2001.
The Company expects a second quarter loss of approximately $2.9 million or $0.12 per share as compared to an $8.2 million loss in the same quarter of Fiscal 2001 ($0.34 per share) and a $3.2 million loss in the first quarter of Fiscal 2002 ($0.13 per share).
Cash on hand as of March 31, 2002 was approximately $16.0 million. The net cash outflow for the quarter was $1.9 million as compared to $8.9 million in the same period of the prior year and $2.3 million in the first quarter of Fiscal 2002.
Further details will be provided when the Company announces its final results in mid-May.
"Longer than anticipated sales and negotiation cycles for service providers in North America has meant lower than expected revenues in the quarter." said Jane Mowat, executive vice president and chief financial officer.
"Total expenses for the quarter increased by approximately $0.3 million as compared to the first quarter and the increase is primarily from charges to general and administrative expenses," added Ms. Mowat. "The company's net loss has been reduced on a year over year basis by over 60% and with the reduction in our expenses and cash burn rate we are able to withstand the impact of continued slow sales cycles. We still remain cautiously optimistic that we can deliver revenue growth and significant overall financial improvement this Fiscal year."
During the second quarter, Centrinity announced it signed a letter of intent with TDS TELECOM, the sixth largest Non-RBOC (Regional Bell Operating Company) telecommunications provider in the United States. Centrinity continues to negotiate with TDS TELECOM and anticipates signing a definitive agreement during the current quarter. The Company also announced an arrangement with Unicomms Ltd., an application services provider (ASP) located in the Channel Islands, to deliver Centrinity's FirstClass Unified Communications solution to their customer base in the United Kingdom and the Channel Islands.
In addition, Centrinity completed the first phase of implementation of its FirstClass Communications Platform at Tuskegee University in Alabama, recorded its largest Unified Communications sale ever to the Oklahoma City Board of Education and announced the availability of its Mac OS X beta version of FirstClass 6.1.
On March 26, Centrinity's founder, Myles McGovern, stepped down from his position as president and chief executive officer. The Company's board of directors created the office of the chief executive, which is comprised of Ms. Mowat and John Myers, the newly appointed executive vice president and chief operating officer. Ms. Mowat and Mr. Myers are responsible for the day-to-day operations of Centrinity until the board appoints a new chief executive officer. Mr. McGovern continues as a director of the Company.
Ms. Mowat and Mr. Myers have extensive general management, operational and high tech expertise that strongly complements the expertise of the existing senior management team. Both have contributed to the re-alignment of the Company's costs and to the creation and execution of its current go-to-market strategy.
"Since joining the company a year ago, I have worked with the senior management team to formulate the strategies to support Centrinity's growth plans and those strategies remain unchanged," said Mr. Myers. "I am excited by the opportunity the Company has before it and the tremendous potential of its FirstClass technology in both the Groupware and Unified Communications markets. Jane and I continue to focus on the execution of those strategies and will measure the Company's progress as compared to the specific milestones outlined at the beginning of Fiscal 2002."
Second Quarter Teleconference Call
John Myers, executive vice president and chief operating officer, Jane Mowat, executive vice president and chief financial officer, and Bruce Horton, vice president of finance and administration will host a teleconference call in mid-May to comment on the Company's second quarter financial results and provide guidance for the remainder of the Fiscal year. The date and time will be publicized one week prior and will be posted on the Company's web site at www.Centrinity.com in the "investors" category.
About FirstClass Communications Platform
FirstClass is a communications software solution that combines the Company's award-winning Collaborative Groupware and Unified Communications technology into one Common Communications Platform. At the foundation of the FirstClass Communications Platform is Centrinity's Collaborative Groupware, which provides users with the ability to effectively communicate and share valuable resources through email, conferencing, directories, calendaring and online chats.
Centrinity's FirstClass Unified Communications technology, seamlessly converges email, voice mail and fax messages into one unified mailbox thereby enabling users to access all of their data and messages via the device of their choice including cellphone, telephone, computer and handheld devices - anytime, anywhere.
About Centrinity Inc.
Centrinity is a leading provider of Unified Communications and Collaborative Groupware software solutions to service providers, enterprises and learning organizations. Our award-winning software solutions are designed to enhance productivity and efficiency by simplifying and facilitating the management of communications and information among individuals and groups. Centrinity is listed under the symbol 'CTI' on the Toronto Stock Exchange. Website: www.centrinity.com.
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For more information please contact:
Margaret Williamson
Manager, Corporate Communications
Tel: 905.762.6234
This news release may include statements about expected future events and/or financial results that are forward-looking in nature and subject to risks and uncertainties. The company cautions that actual performance will be affected by a number of factors, many of which are beyond its control. Future events and results may vary substantially from what the company currently foresees.
FirstClass is a registered trademark of a Centrinity Inc. subsidiary used under license. Centrinity and the Centrinity logo are trademarks of Centrinity Inc. All other trademarks are the property of their respective owners.
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