Press Release

Wednesday, April 17, 1996 < Prev Next >

Visio Corporation Announces Second Quarter 1996 Results

SEATTLE, April 17 /PRNewswire/ — Visio Corporation (Nasdaq: VSIO) today reported results for the second quarter of fiscal 1996. Revenues for the quarter were $14.5 million, an 88 percent increase over second quarter fiscal 1995 revenues of $7.7 million. Net income was $2.3 million and earnings per share were $0.16, compared to net income of $.4 million and earnings per share of $0.03 for the second quarter of fiscal 1995, an increase of 475 percent and 433 percent, respectively. The Company achieved an operating margin of 21 percent, compared to 6 percent for the same period last year.

For the six months ended March 31, 1996, revenues were $27.9 million, a 75 percent increase from $15.9 million for the comparable period last year. Net income was $4.4 million, or $.31 per share, compared to $.7 million, or $.06 per share, for the comparable period of fiscal 1995, representing percentage gains of 529 percent and 417 percent, respectively.

"Visio had strong revenue growth in the quarter reflecting overall strength in our business," said Jeremy Jaech, Visio's chairman, president and chief executive officer. "Our customers are consolidating their graphics requirements onto Visio and Visio Technical from manual tools and other applications, and our products are increasingly deployed broadly within enterprises. The recently announced corporate licensing agreement with Hewlett-Packard is one such example."

During the second quarter, Visio generated $10.9 million in revenue and Visio Technical generated $3.5 million, an increase of 68 percent and 270 percent, respectively, over the prior year's comparable quarter. "We're especially pleased to see that both Visio 4.0 and Visio Technical 4.0 performed strongly. Visio Technical 4.0 increased its share of the technical drawing market according to our most recent market data, while Visio 4.0, which made up 75 percent of revenues for the second quarter, continued its strong growth trend as well," said Jaech. A Worldwide English version of Visio Technical 4.1 was introduced and a Kanji version of Visio 4.0 was shipped during the second quarter. The company anticipates that it will ship additional language versions of its products during fiscal 1996. International operations generated $5.4 million, or 37 percent of revenues, a 128 percent increase over the prior year period. The strong international growth is primarily due to revenue from the Pacific Rim region. Additionally, the Company experienced revenue growth in each of the distribution, direct and volume licensing channels. Volume licensing revenues increased 241 percent over the prior year period, which reflects Visio's focus on selling to enterprises.

Visio Corporation, a leading supplier of enterprisewide business diagramming and technical drawing software, was founded in September 1990. The Seattle-based company pioneered the drawing and diagramming market with the release of Visio 1.0 in November 1992. Since then, Visio has released additional Windows-based products for the creation of drawings and diagrams throughout business enterprises. The company markets the Visio product line in North America, South America, Europe and Asia.

This press release contains forward-looking statements. There are certain important factors that could cause results to differ materially from those anticipated by some of the statements made above. Among these are fluctuations in quarterly performance, dependence on other products including Microsoft Windows, competition in the business drawing and diagramming software market, timing and customer acceptance of new products, and changes in general economic conditions. Additional information concerning these and other risks is described in the "Risk Factors" section of the prospectus contained in the Registration Statement on Form S-1 filed by the Company on September 15, 1995, and, from time to time, in the Company's Securities and Exchange Commission reports, which include the Report on Form 10-Q for the quarter ended December 31, 1995. Actual results may differ materially.

Additional information about Visio Corporation is available on the Internet at http://www.visio.com . Details about Visio Corporation are also available on CompuServe and MSN, The Microsoft Network.

NOTE: Visio is a registered trademark of Visio Corporation. Microsoft and MSN are either registered trademarks or trademarks of Microsoft Corp. in the United States and/or other countries. CompuServe is a registered trademark of CompuServe Inc.


                            Visio Corporation
                          Statements of Income
                  (In thousands, except per share data)
                               (Unaudited)
                                               Three Months Ended
                                                    March 31,
                                              1996              1995
    Revenues                             $14,527  100%      $7,653  100%
    Cost of revenues                       2,384   16        1,373   18
    Gross Margin                          12,143   84        6,280   82
Operating expenses:

      Research and development             2,720   19        1,151   15
      Sales and marketing                  5,231   36        4,097   53
      General and administrative           1,080    7          602    8
    Total operating expenses               9,031   62        5,850   76
    Income from operations                 3,112   21          430    6
    Other income, net                        352    3          168    2
    Income before income taxes             3,464   24          598    8
    Provision for income taxes             1,143    8          210    3
    Net Income                            $2,321   16%        $388    5%
Pro forma:

      Net income per share, primary        $0.16             $0.03
Shares used in computation of
      pro forma net income per share      14,849            11,738

                            Visio Corporation
                          Statements of Income
                  (In thousands, except per share data)
                               (Unaudited)
                                Continued
                                               Six Months Ended
                                                    March 31,
                                              1996              1995
    Revenues                             $27,944  100%     $15,880  100%
   Cost of revenues                        4,729   17        2,715   17
    Gross Margin                          23,215   83       13,165   83
Operating expenses:

      Research and development             4,384   16        2,267   14
      Sales and marketing                 10,778   39        8,892   56
      General and administrative           2,119    7        1,145    7
    Total operating expenses              17,281   62       12,304   77
    Income from operations                 5,934   21          861    6
    Other income, net                        633    3          220    1
    Income before income taxes             6,567   24        1,081    7
    Provision for income taxes             2,167    8          379    3
    Net Income                            $4,400   16%        $702    4%
Pro forma:

      Net income per share, primary        $0.31             $0.06
Shares used in computation of
      pro forma net income per share      14,198            11,544

                            Visio Corporation
                             Balance Sheets
                             (in thousands)
                                                 Mar. 31,     Sept. 30,
                                                  1996          1995
                                              (unaudited)
ASSETS

CURRENT ASSETS:

      Cash and cash equivalents                 $51,067        $7,063
      Trade accounts receivable, net              3,680         4,462
      Inventories                                   998         1,431
      Prepaid expenses                            1,483         1,662
      Deferred income taxes                       1,736         2,136
    Total current assets                         58,964        16,754
    Equipment and leasehold improvements, net     2,594         2,308
    Other assets                                      6           185
    Total  assets                               $61,564       $19,247
LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)

CURRENT LIABILITIES:

      Accounts payable                          $ 4,002       $ 4,176
      Accrued compensation and benefits           1,629         1,025
      Other accrued liabilities                   7,522         5,041
      Income taxes payable                        1,790         2,653
      Current portion of long-term obligations      380           394
    Total current liabilities                    15,323        13,289
    Long-term obligations                           299           453
    Convertible & redeemable preferred stock          0         6,545
SHAREHOLDERS' EQUITY (DEFICIT):

      Common stock                                  133            56
      Additional paid-in capital                 42,993           487
      Translation adjustments                       (75)          (74)
      Retained earnings (accumulated deficit)     2,891        (1,509)
    Total shareholders' equity (deficit)         45,942        (1,040)
Total liabilities and shareholders'
     equity (deficit)                           $61,564       $19,247

/CONTACT: Leslie Deitz of Visio Corporation, 206-521-4546/

/Visio Corporation's press releases are available through Company News On-Call by fax, 800-758-5804, ext. 107036, or http://www.prnewswire.com /

(VSIO)

CO: Visio Corporation ST: Washington IN: CPR SU: ERN

JL — SEW012 — 9294 04/17/96 16:18 EDT

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