Webhire Cash Flow From Operations is Positive for Fourth Consecutive Quarter; Webhire Announces Fiscal Year End 2002 Results

Business Wire, Dec 3, 2002

Business/Technology Editors

LEXINGTON, Mass.--(BUSINESS WIRE)--Dec. 3, 2002

Webhire, Inc. (Nasdaq: HIRE), today reported its financial results for the fourth quarter and year ending September 30, 2002.

Earnings before income tax, depreciation and amortization (EBITDA) were $0.4 million for the fourth quarter of 2002, compared with $0.7 million in the fourth quarter of 2001. EBITDA for the year ending September 30, 2002 was $1.7 million compared to a loss of $4.2 million for the year ending September 30, 2001.

Net cash flow from operations was a positive $0.4 million in the fourth quarter of fiscal 2002, compared with $1.3 million negative cash flow in the fourth quarter of 2001. Net cash flow from operations for fiscal 2002 was $3.0 million versus a negative cash flow from operations of $7.3 million in fiscal 2001.

Total Webhire revenue for the fourth quarter of fiscal 2002 was $3.9 million, compared with $4.9 million for the fourth quarter of 2001. Total revenue for fiscal 2002 was $16.4 million, compared with $21.9 million for fiscal 2001.

The fourth quarter net loss was $0.7 million or ($0.15) per share, compared with a loss of $0.6 million, or ($0.13) per share for the fourth quarter of 2001. Total net loss for fiscal 2002 was $3.0 million, compared with the net loss for fiscal 2001 of $11.0 million.

"A key goal entering fiscal 2002 last October was to drive Webhire to solid financial health," said Marty Fahey, Webhire's CEO. "Specifically, we hoped to reach positive EBITDA and positive cash flow for the year. I am pleased to announce that we have more than achieved our goal. We not only reached these key milestones for the year but also in each quarter. We ended the year with $1.3 million more in cash than when we started. With a solid financial base established, we are focusing on our fiscal 2003 goal to build revenue momentum."

In the quarter, the Company continued to add new subscribers which include Cousins Properties, Data Computer Corporation, Luck Stone Corporation, Medical & Health Research Association, AstraZeneca, Population Services International. Existing customers, Amgen, Immunex and MIT migrated from the Enterprise product to the internet service.

Conference Call Information

Webhire invites its shareholders, prospective shareholders, and analysts to attend its Q4 results conference call on Tuesday, December 3, 2002, at 4:30 p.m. (ET). Marty Fahey, Webhire's CEO, will host the call.

The dial in number for US and Canada is (800) 500-3792. International callers should dial (719) 457-2734. Please advise the operator that you are dialing in for the Webhire earnings call. The confirmation code for the call is 185963.

For the convenience of shareholders, analysts and others who are interested, the Webhire earnings call will be available for replay beginning at 7:30 p.m. (ET) on December 3, 2002 through midnight on December 10, 2002. The toll-free telephone number for the call replay is (888) 203-1112. International callers should dial (719) 457-0820 to hear the replay. The confirmation code is 185963.

About Webhire

With 20 years of experience in the industry, Webhire is the #1 Choice in Recruiting Solutions. Webhire delivers Web-based business-to-business solutions that help employers to quickly and cost-effectively manage the entire hiring process. The company's flagship product, Webhire Recruiter, is used by hundreds of companies to provide simple, reliable, browser-based access to powerful recruiting and hiring tools. Webhire Recruiter, Corporate Edition serves the needs of large enterprises and Webhire Recruiter, Professional Edition meets divisional or mid-sized company needs. Webhire customers and their recruiting requirements span the range from fast-growing firms such as The Sharper Image, and Lee Memorial Health System, to large corporations, such as Northrop Grumman and Heinz. Webhire investors include SOFTBANK Capital Partners and Korn/Ferry International, the world's leading recruitment company. Founded in 1982, Webhire is based in Lexington, Massachusetts (USA), and is traded on NASDAQ under the ticker symbol HIRE.

For more information, visit: www.webhire.com

Or call: 1-877-WEBHIRE (1-877-932-4473)

Outside the U.S., call: 781-869-5000

Webhire is a registered trademark of Webhire, Inc. All other products and trademarks mentioned may be registered trademarks or trademarks of their respective owners.

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. The Company's actual results could differ materially from those set forth in the forward-looking statements. Factors that might cause such a difference include overall economic conditions, the effectiveness of strategic partnerships, changes in technology and industry standards, increased competition and market acceptance of the Company's products and services and those of its competitors.

                             WEBHIRE, INC.
                 CONSOLIDATED STATEMENTS OF OPERATIONS
          (in thousands, except share and per share amounts)

                            Three Months Ended    Twelve Months Ended
                               September 30,          September 30,
                             2002       2001        2002        2001
Revenue:
  Services revenue -
   Internet            $    2,959  $    2,837  $   11,619  $   12,518
  Services revenue -
   Enterprise                 932       1,938       4,552       7,922
  Product Revenue              38         117         201       1,443
     Total Revenue          3,929       4,892      16,372      21,883

Cost of Revenue:
  Services -
   Internet                 1,246       1,903       5,695       9,445
  Services -
   Enterprise                 286         259       1,253       1,360
  Product revenue              31          56          82         366
  Amortization of
   acquired
   technologies               746         172       2,866       2,763
     Total Cost of
      Services Revenue      2,309       2,390       9,896      13,934

Gross Profit           $    1,620  $    2,502  $    6,476  $    7,949

Operating Expenses:
  Research and
   Development                497         623       2,262       6,053
  Sales and
   Marketing                  719       1,142       3,034       6,993
  General and
   Administrative           1,042         802       4,139       4,260
  Amortization of
   Other Intangibles           63         545         253       2,180
    Total Operating
     Expenses               2,321       3,112       9,688      19,486

Loss from Operations   $     (701) $     (610) $   (3,212) $  (11,537)

Other Income (Expense)
  Non-cash interest
   on warrants issued          --          --          --        (309)
  Other Income, Net             4          28          31         774
    Total Other Income          4          28          31         465

(Loss) Income Before
 (Benefit) Provision
 for Income Taxes      $     (697) $     (582) $   (3,181) $  (11,072)

   (Benefit) Provision
    for Income Taxes           (0)          0        (165)        (69)

Net (Loss) Income      $     (697) $     (582) $   (3,016) $  (11,003)

Basic and diluted
 net loss per
 common share          $    (0.15) $    (0.13) $    (0.67) $    (2.47)

Basic and diluted
 weighted average
 number of common
 shares outstanding     4,522,871   4,510,675   4,519,950   4,454,389

Earnings before
 interest, taxes,
 depreciation and
 amoritzation
 (EBITDA)              $      408  $      674  $    1,655  $   (4,194)


                             WEBHIRE, INC.
                      CONSOLIDATED BALANCE SHEETS
                 (in thousands, except share amounts)

                                                Sept. 30     Sept. 30
                                                  2002         2001
                                ASSETS
Current assets:
  Cash and cash equivalents                     $ 4,995       $ 2,982
  Short-term investments                              -           695
  Restricted cash                                 1,500         1,500
  Accounts and installments
   receivable, less allowance for
   doubtful accounts of $717 and
   $484 at September 30, 2002 and
   September 30, 2001, respectively                 744         2,041
  Other current assets                              882         1,822
     Total current assets                         8,121         9,040
  Long-term installments receivable, net              -            63
  Property and equipment, net                     1,038         2,518
  Acquired technologies, net of
   accumulated amortization of $7,346
   and $1,243 at September 30, 2002
   and September 30, 2001, respectively             523           826
  Intangible assets net of accumulated
   amortization of $945 and $3,928 at
   September 30, 2002 and
   September 30, 2001, respectively               1,796         3,246
  Other assets                                      301           398
      Total Assets                             $ 11,779      $ 16,091

                 LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
  Accounts payable                                $ 390       $ 1,930
  Accrued expenses                                1,615         1,305
  Notes payable - bank                            1,500         1,500
  Convertable Notes Payable
  Current portion of capital
   lease obligations                                 64           234
  Deferred revenue                                4,557         4,422
     Total current liabilities                    8,126         9,391
Other liabilities                                    99           152
     Total liabilities                            8,225         9,543
Commitments and contingencies                         -             -
Stockholders' equity:
  Preferred stock, $.01 par value.
   Authorized - 5,000,000 shares,
   Issued and outstanding - none
   at September 30, 2002 and
   September 30, 2001                                 -
  Common stock, $.01 par value.
   Authorized - 30,000,000 shares,
   Issued - 4,660,251 and 4,648,055
   shares at Septemer 30, 2002 and
   September 30, 2001, respectively
   Outstanding - 4,522,871 and
   4,510,675 shares at September
   30, 2002 and September 30, 2001,
   respectively                                      46            46
  Additional paid-in capital                     70,214        70,192
  Treasury stock, at cost - 137,380
   shares at September 30, 2002 and
   September 30, 2001, respectively                (831)         (831)
  Accumulated deficit                           (65,875)      (62,859)
    Total stockholders' equity                    3,554         6,548
      Total Liabilities and
       Stockholders' Equity                    $ 11,779      $ 16,091