FOR IMMEDIATE RELEASE
CONTACT
Nigel Ekern
Chief Administrative Officer
Clarus Corporation
(203) 428-2000
nekern@claruscorp.com
CLARUS ANNOUNCES SECOND QUARTER 2004 RESULTS
STAMFORD, CONNECTICUT -- AUGUST 6, 2004 -- Clarus Corporation (Nasdaq: CLRS)
today announced financial results for the quarter ended June 30, 2004. Clarus
reported no revenues for the second quarter of 2004, compared to $25,000 from
the recognition of deferred software service fees during the comparable period
of 2003. Net loss for the second quarter of 2004 was $963,000 or $0.06 per
diluted share compared to a net loss of $1.0 million or $0.07 per diluted share
during the comparable period of 2003. As of June 30, 2004, Clarus' cash, cash
equivalents and marketable securities were $85.0 million (or $5.12 gross cash
per share1) compared to $88.7 million as of December 31, 2003.
Clarus estimates that it has available net operating loss, capital loss,
research and experimentation credit and alternative minimum tax credit
carryforwards for U.S. federal income tax purposes of approximately $113.8
million, $15.2 million, $1.3 million and $53,000, respectively, which expire in
varying amounts beginning in the year 2009 to the extent not limited under
section 382 of the Internal Revenue Code. Clarus has also incurred foreign
losses in the amount of approximately $4.0 million that are available to offset
future taxable income in foreign jurisdictions.
As reported in its June 25, 2004 press release, the Company is currently engaged
in negotiation of a significant transaction to redeploy its assets, however,
there can be no assurance that this transaction will be consummated. On June 22,
2004, the Company received notice from the staff of The Nasdaq Stock Market that
the Company's common stock would be delisted from the Nasdaq National Market
effective as of the opening of business on July 1, 2004. The Company has
appealed such delisting to the Nasdaq Listing Qualification Panel and such
appeal will stay the delisting of the Company's securities pending the Panel's
decision.
On July 1, 2004, the Company entered into a memorandum of understanding to
settle a securities class action brought against the Company that was originally
filed in 2000. Pursuant to the memorandum, the Company agreed in principle to
settle the lawsuit in exchange for a payment of $4.5 million, which is expected
to be covered by insurance. The final settlement of the consolidated class
action is subject to certain action including the execution of definitive
documentation and approval by the Court.
Nigel Ekern, Clarus' Chief Administrative Officer stated, "We continue to be
actively engaged in the negotiation of a significant transaction as part of our
strategy to redeploy our cash and utilize our NOL's, to the extent available. Of
course, no assurance can be given that this transaction will be consummated.
Also, we are pleased that the securities class action lawsuit has been settled
and that the settlement payment is expected to be covered by our insurance
carriers."
Clarus does not currently intend to hold conference calls to discuss quarterly
earnings releases unless we consummate an acquisition in connection with our
redeployment strategy. At such time, we plan to resume holding quarterly
conference calls to review earnings and our operating performance.
Clarus, formerly a provider of e-commerce business solutions, is seeking to
redeploy its assets and use its substantial cash and cash equivalent assets to
enhance stockholder value.
(1) Gross cash per share at June 30, 2004 equals cash, cash equivalents and
marketable securities of $85.0 million divided by 16.6 million common shares
outstanding. Clarus has provided this Non-GAAP measure because it believes that
it is useful to investors assessing the extent of the Clarus' assets available
for redeployment. Clarus is unaware of any comparable GAAP measure.
THIS PRESS RELEASE CONTAINS FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF THE
SECURITIES ACT OF 1933 AND THE EXCHANGE ACT OF 1934. INFORMATION IN THIS RELEASE
INCLUDES CLARUS' BELIEFS, EXPECTATIONS, INTENTIONS AND STRATEGIES REGARDING
CLARUS, ITS FUTURE AND ITS PRODUCTS AND SERVICES. ASSUMPTIONS RELATING TO THE
FORWARD-LOOKING STATEMENTS INVOLVE JUDGMENTS WITH RESPECT TO, AMONG OTHER
THINGS, FUTURE ECONOMIC, COMPETITIVE AND MARKET CONDITIONS AND FUTURE BUSINESS
DECISIONS, ALL OF WHICH ARE DIFFICULT OR IMPOSSIBLE TO PREDICT ACCURATELY AND
MANY OF WHICH ARE BEYOND OUR CONTROL. ACTUAL RESULTS COULD DIFFER MATERIALLY
FROM THOSE PROJECTED IN THE FORWARD-LOOKING STATEMENTS AS A RESULT OF CERTAIN
RISKS INCLUDING OUR INABILITY TO EXECUTE SUCCESSFULLY OUR PLANNED EFFORT TO
REDEPLOY OUR ASSETS TO ENHANCE STOCKHOLDER VALUE, THE UNAVAILABILITY OF OUR NET
OPERATING LOSS CARRY FORWARD, AND THAT THE UNAUDITED FINANCIAL INFORMATION
PROVIDED IN THIS PRESS RELEASE MAY BE ADJUSTED AS A RESULT OF THE YEAR END
AUDIT. CLARUS CANNOT GUARANTEE ITS FUTURE PERFORMANCE. ALL FORWARD-LOOKING
STATEMENTS CONTAINED IN THIS RELEASE ARE BASED ON INFORMATION AVAILABLE TO
CLARUS AS OF THE DATE OF THIS RELEASE AND CLARUS ASSUMES NO OBLIGATION TO UPDATE
THE FORWARD-LOOKING STATEMENTS CONTAINED HEREIN.
For further information regarding the risks and uncertainties in connection with
Clarus' business, please refer to the "Management's Discussion and Analysis of
Financial Condition and Results of Operations" and "Factors That May Affect Our
Future Results" sections of Clarus' filings with the Securities and Exchange
Commission, including but not limited to, its most recent annual report on Form
10-K and quarterly reports on Form 10-Q, copies of which may be obtained at the
SEC's web site at http://www.sec.gov.
CLARUS CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)
JUNE 30, DECEMBER 31,
2004 2003
--------- ---------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 34,798 $ 15,045
Marketable securities 50,150 73,685
Interest receivable 666 507
Prepaids and other current assets 698 132
--------- ---------
Total current assets 86,312 89,369
PROPERTY AND EQUIPMENT, NET 2,458 38
OTHER ASSETS:
Deposits and other long-term assets 1,536 38
--------- ---------
TOTAL ASSETS $ 90,306 $ 89,445
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable and accrued liabilities $ 3,357 $ 1,520
Deferred revenue 1,106 1,106
--------- ---------
Total current liabilities 4,463 2,626
LONG-TERM LIABILITIES:
Other long-term liabilities 41 --
--------- ---------
Total liabilities 4,504 2,626
--------- ---------
STOCKHOLDERS' EQUITY:
Preferred stock, $.0001 par value; 5,000,000 shares authorized; none
issued -- --
Common stock, $.0001 par value; 100,000,000 shares authorized;
16,663,240 and 16,649,048 shares issued and 16,588,240 and 16,574,048
outstanding in 2004 and 2003, respectively 2 2
Additional paid-in capital 369,232 367,031
Accumulated deficit (278,201) (276,767)
Treasury stock, at cost (2) (2)
Accumulated other comprehensive income (129) (17)
Deferred compensation (5,100) (3,428)
--------- ---------
Total stockholders' equity 85,802 86,819
--------- ---------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 90,306 $ 89,445
========= =========
CLARUS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
THREE MONTHS SIX MONTHS
ENDED JUNE 30, ENDED JUNE 30,
-------------------- ---------------------
2004 2003 2004 2003
-------- -------- -------- --------
REVENUES:
Services fees $ -- $ 25 $ -- $ 78
-------- -------- -------- --------
Total revenues -- 25 -- 78
COST OF REVENUES:
Services fees -- -- -- --
-------- -------- -------- --------
Total cost of revenues -- -- -- --
OPERATING EXPENSES:
General and administrative 1,202 1,522 1,925 3,831
Depreciation and amortization 14 -- 14 761
-------- -------- -------- --------
Total operating expenses 1,216 1,522 1,939 4,592
OPERATING LOSS (1,216) (1,497) (1,939) (4,514)
OTHER INCOME -- 75 17 380
INTEREST INCOME 253 390 487 748
INTEREST EXPENSE -- 10 -- 66
-------- -------- -------- --------
NET LOSS $ (963) $ (1,042) $ (1,435) $ (3,452)
======== ======== ======== ========
Loss per common share:
Basic $ (0.06) $ (0.07) $ (0.09) $ (0.22)
Diluted $ (0.06) $ (0.07) $ (0.09) $ (0.22)
Weighted average shares outstanding:
Basic 16,082 15,884 16,082 15,812
Diluted 16,082 15,884 16,082 15,812
CLARUS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
SIX MONTHS
ENDED JUNE 30,
---------------------
2004 2003
-------- ---------
OPERATING ACTIVITIES:
Net loss $ (1,434) $ (3,452)
Adjustments to reconcile net loss to net cash used in operating
activities:
Depreciation and amortization on property and equipment 14 761
Amortization of deferred employee compensation 478 --
Noncash other -- (70)
Amortization of premium on purchase of marketable securities 707 --
Gain on sale of marketable securities (17) --
Non-cash general and administrative expense -- 86
Provision for doubtful accounts -- (67)
Loss on disposal of assets -- 37
Changes in operating assets and liabilities:
Accounts receivable -- 534
Prepaid and other current assets (725) 252
Assets held for sale -- 48
Deposits and other long-term assets -- 8
Accounts payable and accrued liabilities (484) 12
Deferred revenue -- (79)
Liabilities to be assumed -- (220)
Other long-term liabilities 41 --
-------- ---------
NET CASH USED IN OPERATING ACTIVITIES (1,420) (2,150)
INVESTING ACTIVITIES:
Purchases of marketable securities (47,587) (109,823)
Proceeds from sale of marketable securities 51,244 125,629
Proceeds from maturity of marketable securities 19,076 --
Proceeds from sale of equipment -- 11
Increase in transaction costs (97) 8
Purchases of property and equipment (1,514) (4)
-------- ---------
NET CASH PROVIDED BY INVESTING ACTIVITIES 21,122 15,813
FINANCING ACTIVITIES:
Proceeds from the exercises of stock options 51 1,201
Repayment of debt -- (5,000)
-------- ---------
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES 51 (3,799)
-------- ---------
Effect of exchange rate change on cash -- (48)
CHANGE IN CASH AND CASH EQUIVALENTS 19,753 9,816
CASH AND CASH EQUIVALENTS, Beginning of Period 15,045 42,225
-------- ---------
CASH AND CASH EQUIVALENTS, End of Period $ 34,798 $ 52,041
======== =========
SUPPLEMENTAL DISCLOSURE OF NON-CASH OPERATING, INVESTING, AND FINANCING ACTIVITIES:
NON-CASH TRANSACTIONS
Increase in property and equipment included in
accounts payable and accrued liabilities $ 920 $ --
Increase in transaction costs included in other assets and
accounts payable and accrued liabilities 1,401 --
Issuance of Restricted Stock $ 50 $ --
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