SmartForce neemt Centra Software over. Cijfers SmartForce vierde kwartaal
Redwood City, Calif. – Jan. 16, 2002 – SmartForce (Nasdaq:SMTF) today announced that it has entered into a definitive agreement to acquire Centra Software (Nasdaq: CTRA). The transaction, the largest to date in the e-Learning industry, unites the world`s largest e-Learning company with the leading provider of live e-Learning and business e-Collaboration software. SmartForce today also announced revenues and earnings per share for the fourth quarter of 2001, meeting SmartForce`s targets and consensus First Call estimates.
Centra Software Acquisition
SmartForce announced today that it is expanding its industry leadership position by acquiring Centra Software in a stock for stock transaction. Based in Lexington, Mass. Centra`s solutions enable real-time, group-oriented human interaction over corporate networks and the Internet. Under the terms of the agreement, Centra shareholders will receive 0.425 shares of SmartForce for each Centra share. Based on yesterday`s closing price of SmartForce American Depository Shares, the transaction is valued at approximately $284 million, including the assumption of Centra`s stock options.
The acquisition further solidifies SmartForce`s position as the world`s premier e-Learning company. Centra brings to SmartForce world-class technology, talented employees and a blue-chip customer base that will complement the more than 2,500 customers SmartForce already enjoys. Through the acquisition, SmartForce will add Centra`s base of over 775 customers, the substantial majority of which are new to SmartForce. Moreover, the deal will solidify SmartForce`s position as a market leader with over 2,000 employees, including over 900 customer facing employees, and combined 2001 research and development investment of over $60 million, more than triple the investment of any other public e-Learning company.
The acquisition also increases SmartForce`s ability to provide targeted learning solutions that support enterprises` critical business processes. Centra`s proven collaboration solutions are designed to facilitate strategic business processes across the extended enterprise, including accelerated product introductions, customer interaction, sales training, hands-on software application deployments, new hire and employee training, change management initiatives and other revenue-generating activities. The integration of Centra`s collaboration technology with SmartForce`s key capabilities- including content, platform, tools and services- will help SmartForce to rapidly develop and deploy preconfigured learning solutions that address these processes, solutions that customers can easily customize for their specific objectives.
Furthermore, the integration of Centra`s collaboration software with the SmartForce e-Learning platform will also significantly advance the Company`s longer-term strategy of becoming the primary infrastructure used by global enterprises to drive knowledge transfer throughout the extended enterprise.
“This combination is truly a watershed event for the e-Learning industry,” said Greg Priest, Chairman and CEO of SmartForce. “Critical mass and scale have become increasingly important as the market`s requirements have matured and new market entrants have emerged. By joining together with Centra, we are taking another major step forward in building a company that can become a powerful and enduring franchise. We lead the market today by every significant measure, including customer base, salespeople, breadth of offerings and technology investment.”
“We are delighted to be joining forces with SmartForce,” said Leon Navickas, Chairman and CEO of Centra. “This transaction will enable the combined company to move beyond traditional training and skills applications to build solutions on a robust software infrastructure for our customers that gets to the core of their mission-critical business problems.”
The acquisition has been approved by both companies` Boards of Directors and is subject to various closing conditions, including approval by the shareholders of both companies and obtaining specific regulatory approvals. Credit Suisse First Boston is acting as financial advisor to SmartForce on this transaction.
Post-Acquisition Financial Guidance
SmartForce anticipates that the acquisition will be completed during the second quarter of 2002 and that the acquisition will be one cent accretive to earnings per share for the second half of 2002. In addition, the Company anticipates that the acquisition will be accretive to earnings in 2003, and has established a 2003 pre-amortization earnings per share target for the combined business of $1.05, up from our previous 2003 target of $1.00. There will be a substantial one-time charge in the second quarter of 2002 in connection with the acquisition and the transaction will also be dilutive to Q2 earnings with the exact amount depending on the timing of closing, given that this is a purchase transaction.
The above targets represent the Company`s current revenue and earnings goals as of the date of this release, and are based on current conditions. The Company does not undertake to update these targets in any way or for any reason.
2001 Financial Results
SmartForce`s revenues for the fourth quarter were $65.3 million, up 13 percent from the $57.7 million reported a year ago. Net income for the quarter excluding amortization of intangible assets was $2.6 million, or $0.04 per share, in line with First Call consensus estimates. This compares with net income of $648,000, or $0.01 per share, for the fourth quarter of 2000. On a reported basis, the company recorded a net loss for the quarter of $205,000 or $0.00 per share.
For 2001 as a whole, revenues were $261 million. Net income for the year, before amortization of acquired intangibles, was $13.2 million, or $0.22 per share. On a reported basis, the Company recorded net income for 2001 $3.0 million, or $0.05 per share.
SmartForce continued to execute on its strategy, posting solid growth and operating metrics. The Company reported that its average contract size increased to $180,000, sequentially up from $175,000 during the third quarter and up 13 percent from the same period a year ago. SmartForce continued to leverage its customer base by renewing and expanding existing contracts and penetrating multiple departments within its customer organizations. As a result, the Company`s dollar renewal rate remained strong, at over 150 percent. SmartForce again exceeded its goal of signing at least five deals worth over $1 million during the quarter. December bookings were particularly strong, representing the best bookings month of 2001.
We are encouraged by the strength we saw in the quarter and are particularly pleased with the success our sales force is having in selling solutions that are critical to our customers` business initiatives,” commented Mr. Priest. “Customers are increasingly looking to SmartForce as the partner to help them get the most out of their e-Learning solutions.”
SmartForce, the world`s largest e-Learning company, provides integrated enterprise e-Learning solutions. SmartForce e-Learning is a comprehensive application infrastructure to support e-Learning initiatives in enterprises globally. Encompassing the largest body of e-Learning content in the world, and a fully integrated student environment, learning management system and a range of custom content creation and publication tools, SmartForce e-Learning provides the architecture that global enterprises are using today to implement e-Learning strategies to support their critical strategic business initiatives. With more than 2,500 major corporate customers, SmartForce e-Learning solutions bring the power of the Internet to the critical training business process. SmartForce is quoted on the NASDAQ National Market under the symbol “SMTF.” The company, which has more than 1,800 employees worldwide, has corporate headquarters at 900 Chesapeake Drive, Redwood City, Calif., 94063. Phone: 650.817.5900. Fax: 650.817.5061. Web site: www.smartforce.com.
Centra is the world`s leading provider of e-Learning and business e-Collaboration applications. Used by more than 775 companies, government agencies, and universities worldwide, Centra offers a comprehensive suite of real-time knowledge delivery and management solutions, including voice-enabled virtual classrooms, Web conferences and online meetings. Centra offers the most advanced voice-over-IP technologies, with scalability across the extended enterprise and seamless access through thin client architecture. Using the broad suite of Centra applications, global organizations increase the overall effectiveness of their e-Learning and communication initiatives, targeting the appropriate mix of live and self-paced learning formats and activities for each audience or strategic business task.
Statements in this release, including but not limited to the statements contained in the “Financial Guidance” section of this release are forward-looking statements that involve a number of risks and uncertainties. Important factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to: risks associated with developing, deploying, maintaining and delivering the Company`s e-Learning solutions; market acceptance of the Company`s e-Learning solutions; competition from existing and new competitors; risks associated with international operations and expansion; the possibility of decreased demand for e-Learning solutions; changes in customer budget cycles, changes in general economic conditions and other factors detailed in the Company`s filings with the Securities and Exchange Commission, including but not limited to the Company`s report on Form 10-Q for the quarter ended Sept. 30, 2001.
Additional information about the merger and where to find it
SmartForce intends to file a registration statement on Form S-4 in connection with the transaction, and SmartForce and Centra intend to mail a joint proxy statement/prospectus to their respective stockholders in connection with the transaction. Investors and security holders of SmartForce and Centra are urged to read the joint proxy statement/prospectus when it becomes available because it will contain important information about SmartForce, Centra and the transaction. Investors and security holders may obtain a free copy of the joint proxy statement/prospectus (when it is available) at the SEC`s web site at WWW.SEC.GOV. A free copy of the joint proxy statement/prospectus may also be obtained (when it is available) from SmartForce or Centra. In addition to the registration statement on Form S-4 to be filed by SmartForce in connection with the transaction, and the joint proxy statement/prospectus to be mailed to the stockholders of SmartForce and Centra in connection with the transaction, each of SmartForce and Centra file annual, quarterly and special reports, proxy and information statements, and other information with the SEC. Investors may read and copy any of these reports, statements and other information at the SEC`s public reference rooms located at 450 5th Street, N.W., Washington, D.C., 20549, or any of the SEC`s other public reference rooms. Investors should call the SEC at 1-800-SEC-0330 for further information on these public reference rooms. The reports, statements and other information filed by SmartForce and Centra with the SEC are also available for free at the SEC`s web site at WWW.SEC.GOV. A free copy of these reports, statements and other information may also be obtained from SmartForce or Centra.
SmartForce`s executive officers and directors may be deemed to be participants in the solicitation of proxies from the stockholders of Centra and SmartForce in favor of the Merger. A description of the interests of SmartForce`s executive officers and directors in SmartForce is set forth in the proxy statement for SmartForce`s 2001 Annual Meeting of Stockholders, which was filed with the SEC on June 15, 2001. Investors and security holders may obtain more detailed information regarding the direct and indirect interests of SmartForce`s executive officers and directors in the Merger by reading the preliminary joint proxy statement/prospectus filed with the SEC when it becomes available.
Centra`s executive officers and directors may be deemed to be participants in the solicitation of proxies from the stockholders of Centra and SmartForce in favor of the Merger. A description of the interests of Centra`s executive officers and directors in Centra is set forth in the proxy statement for Centra`s 2001 Annual Meeting of Stockholders, which was filed with the SEC on March 30, 2001. Investors and security holders may obtain more detailed information regarding the direct and indirect interests of Centra`s executive officers and directors in the Merger by reading the preliminary joint proxy statement/prospectus filed with the SEC when it becomes available.
Condensed Consolidated Statements of Operations
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Condensed Consolidated Balance Sheets
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