Database vendor Informix has endeavored to reassure both existing and potential customers that, despite its recent rocky financials, the company is on the road to recovery.
Along with third quarter results for the period ending Sept. 28, 1997, Informix also released restated financial results for the first quarter of this year, the whole of 1996, 1995 and 1994, along with adjusted results for the second quarter of 1997. The company had not been expected to restate its 1994 results.
Given the adjustments to its financial results, the company has decreased revenues for the period between January 1994 and June 1997 by approximately $US278 million, while net income falls by around $236 million. Informix said these restatements were in line with the figure it quoted back in September of in excess of $250 million. The problems with its accounting took "numerous forms," the company said in a statement, and were mostly due to a lack of compliance with its procedures and controls.
Turning to Informix's third quarter results for 1997, company Chairman and CEO Bob Finocchio described the quarter as "very weak," with the database vendor reporting a net loss of $110.7 million on revenues of $149.9 million. On the plus side, Informix does have $95 million in cash and investments, he added.
Other good news for the company was the announcement of another significant cash investment in the shape of $50 million from a trio of investors headed up by an affiliate of Credit Suisse First Boston. Informix announced a $40 million cash injection by Fletcher International back in August.
The database vendor also revealed today that it has obtained a $75 million revolving line of credit for two years from Bank of Boston and Canadian Imperial Bank of Commerce. It has also sold off a 27-acre piece of land it bought earlier this year in Santa Clara, California for the same amount it paid for it -- $60 million.
As well as releasing financial data today, Informix also drew heavily on customer testimonials from the likes of Hilton Hotels, Domino's Pizza and The People's Daily of China to ward off suggestions from database rivals such as Oracle and Sybase that the company is finished as an independent entity.
Fears about the company's financial viability first surfaced when Informix declared a surprise third quarter loss of $140.1 million in May. At that time, Informix executives said the company's financial crisis was largely due to the vendor losing sight of its core relational database offering and focusing all its attentions of its object/relational hybrid database -- Universal Server.
The concerns over the database vendor's future reached fever pitch when Informix announced in September that it would be restating its financials and it was suggested that its stock might be delisted from Nasdaq.
This week, Informix said it hoped to receive approval from Nasdaq tomorrow to resume trading under its normal symbol "IFMX" on Thursday. The company is currently trading under the symbol "IFMXE" while Nasdaq investigates whether or not it should de-list the database vendor from the exchange.
Informix Chairman and CEO Finocchio also revealed today for the first time that his company has been under investigation by the Securities and Exchange Commission (SEC) since July. He added that the investigation was to be expected given the restating of the company's financials and that Informix was "cooperating fully" with the investigation.
As additional bolstering to suggest that Informix is now on the road to recovery, the company today took the somewhat unusual step of releasing details of early fourth quarter large customer wins.
Existing Informix user First Union Corp., the sixth-largest bank in the United States, signed a contract worth more than $1 million to expand its usage of Informix's Online Extended Parallel Server in its corporate data warehouse. Japanese provider of industrial products and service Komatsu Ltd. will be deploying Informix's Online Dynamic Server database in 10,000 seats to link its operations in Japan, Brazil, Germany and the United States in a multimillion dollar deal with the database vendor. The deal with Komatsu is Informix's largest-ever customer win in Japan.
Also announced today by the database vendor, was a management reshuffle, including the appointment of Jim Engle as company treasurer. He was previously vice president and corporate treasurer/chief tax officer at Octel Communications.
Informix, based in Menlo Park, California, can be reached on the Web at http://www.informix.com/.