Sagent Reports $14.5 Million in Third Quarter Revenue; License Revenue Up 20 Percent Sequentially, Driven by New Federal Customers

Business Wire, Oct 30, 2001

Business Editors & High Tech Writers

MOUNTAIN VIEW, Calif.--(BUSINESS WIRE)--Oct. 30, 2001

Sagent (Nasdaq:SGNT), a leading provider of enterprise Business Intelligence solutions, today announced financial results for the third quarter ended September 30, 2001.

Sagent's revenues for the third quarter of 2001 were $14.5 million, a year-over-year increase of 5 percent compared to the $13.8 million reported in the third quarter of 2000, and an increase of 9 percent sequentially, compared to the $13.3 million reported in the second quarter of 2001. Sagent's license revenues for the third quarter of 2001 totaled $8.9 million, a sequential increase of 20 percent compared to the $7.4 million reported in the second quarter of 2001.

Sagent's net loss before stock-based compensation, amortization of goodwill, asset impairment, merger and integration charges and interest and taxes, was $7.2 million, or a loss of $0.18 per share on a fully diluted basis, compared to a net loss of $7.8 million, or a loss of $0.27 per share on a fully diluted basis, for the third quarter of 2000.

Net loss including those items was $9.9 million, or $0.24 per share, for the third quarter of 2001, compared to a net loss of $8.4 million, or $0.29 per share, for the third quarter of 2000. Included in the loss of $9.9 million were: an asset impairment charge related to the spin-off of Sagent's service bureau business; a one-time charge related to the sale of Sagent's small-office/home-office (SOHO) postal discount business; a charge related to the closing of Sagent's facility in Clearwater, Fla.; a charge related to the divestment of Sagent's online prospect listing service; and a bad debts charge for uncollectable accounts receivable. The total amount of these charges, which were largely non-cash, was $3.5 million.

"The third quarter was a challenging one for Sagent. Having been one of the only organizations in the Business Intelligence market to achieve growth in Q2 over Q1, we were tasked with meeting even higher expectations during Q3, a time of economic uncertainty, even before the September 11 terrorist attacks," said Ben Barnes, president and CEO, Sagent. "I am proud to say that Sagent employees worldwide rallied in the face of this adversity and continued to close deals through the end of the quarter leading us to meet our revenue expectations."

      Significant milestones in the third quarter of 2001 included:
       -- Signed 35 New Customers: This quarter Sagent increased its
        customer base with the addition of the American Dental
        Association, Aurora Foods, Bayer Pharmaceuticals, Blood
        Systems, Cincinnati Insurance and the Department of Commerce,
        among others.
       -- Federal Customer Base Grows: Sagent's Federal Government sales
        organization received orders from Fannie Mae, the National
        Security Agency, U.S. Navy Medical and the Pentagon, among
        others.
       -- Signed Repeat Business with 53 Customers: Sagent maintained
        a stronghold on its existing customer base by renewing
        license agreements with Allstate, Bank One, California
        AAA, Foxwoods Casino, Guinness United Distillers, Kemper
        Insurance, Longs Drugs, Microsoft, Nationwide Insurance,
        Pfizer, Sharp Electronics and Sun Chemical, among others.]
       -- Continued International Strength: Sagent continued to
        solidify its No. 1 market share in Japan, with new wins at
        Asahi Beer and Siebu Department Stores, as well as renewed
        business at Kawasaki, NTT-DoCoMo and Suruga Bank. Sagent
        also had a significant Unix win with Singapore Telecom.
       -- Appointed New Executives: Rich Ghiossi, former vice
        president, marketing for Tandem and WhiteLight Systems,
        joined Sagent this quarter as chief marketing officer.
        Ghiossi is responsible for corporate marketing, product
        marketing and product management. Chris Hamlin, formerly
        responsible for global strategic partnering efforts for
        SPSS, joined Sagent as vice president and general manager
        of Sagent's Data Analytics and Data Quality products.
       -- Indirect Channel Producing: Sagent's OEM/VAR/SI team
        represented 23 percent of Sagent's total revenues during
        the third quarter. This includes the signing of Dahlkia,
        the team's first overseas win with Sagent system
        integrator partner, Cap Gemini Ernst & Young; the renewal
        of an OEM agreement with Risk Management Systems; the
        creation of a system integration partnership with Satyam,
        an end-to-end IT solutions provider; and a joint
        sales-and-marketing agreement with CTC, the largest Sun
        distributor in Asia.
       -- Complete Business Intelligence Solution Confirmed: Of
        Sagent's 35 new customers, 40 percent of them bought the
        complete Sagent Solution during the third quarter. This
        indicates the validity of Sagent's complete, open, and
        thin solution in the marketplace.