Business Editors
NOVATO, Calif.--(BUSINESS WIRE)--July 10, 2000
IMSI(R), (OTC "Pink Sheets": IMSI), developer of design software including TurboCAD and FloorPlan3D, and owner of ArtToday.com and HomeDesignToday.com, Monday announced that it has achieved operating profits and positive operating cash flow for the quarter ending June 30, 2000.
IMSI will hold a national conference call on Thursday, July 13, 2000 at 8:00 a.m. PST to brief investors on current and upcoming corporate events. The call-in number is 800/218-0204 and the confirmation code is 735744. The toll-free call will be accessible to the first 200 participants who call in. Participants are encouraged to call five minutes prior to the scheduled start time. There will be a brief question and answer period at the end of the call.
The conference call can also be heard over the Internet through Vcall at http://www.vcall.com. To listen to the live call, listeners should go to the Web site at least 15 minutes early to register, download and install any necessary audio software. For those who are unable to listen to the live broadcast, a replay will be available shortly after the call on the Vcall.com Web site.
"IMSI had a positive EBITDA and positive cash flow from operations for the quarter ending June 30, 2000, on revenues for the three months of over $3.7 million," said Geoffrey Koblick, chief executive officer and president of IMSI. "Of equal importance, in the four months since I returned to IMSI, we have implemented a new strategic plan and restructured the company for future growth on a profitable operating basis."
"We started by adding experienced management with proven success records, including Jeff Morgan, CFO, and executive vice presidents, Paul Jakab and Mike Gariepy, to an already experienced management team (see more detail below). We have also added three new members to our board. I am confident this team can execute our plans."
"We are pleased with the progress we have made, but the company has several challenges ahead with respect to our balance sheet. While IMSI continues to be in default under its loan agreements, our creditors are working with the company by providing time to remedy this situation. In addition to our goal of continuing to operate profitably, we are exploring a wide range of alternatives to address these issues including bringing in new equity investment and/or the sale of business units or other intellectual property assets."
On June 19, 2000, IMSI became an NSCC (National Securities Clearing Corp.) eligible security designated by the NASD OTC Bulletin Board anticipated additions listing. IMSI is a fully reporting company as defined by the SEC; however, the company has not yet met all of the requirements for re-listing onto the NASD OTC Bulletin Board. Management is working closely with NASD Market Making firms sponsoring IMSI's return and anticipates once the NASDR (Regulations Division) receives notification that IMSI's filings have been approved by the SEC, its shares can then be re-listed.
Renewed Investment in Core Technology and Internet Marketing Opportunities
Over the last 17 years, IMSI has developed and sold millions of units of its award-winning design and graphics software products, which include TurboCAD, FloorPlan3D, TurboProject, FormTool, HiJaak Graphics, Flow, Lumiere, MasterClips and Org Plus. These software products have won industry awards like PC Magazine Editor's Choice and numerous others for their ease of use and power.
Koblick continued, "One of our first steps has been to re-invigorate development and sales of these outstanding software products. To that end, we quickly re-instituted our development efforts in Russia and have already begun shipping a new upgrade to TurboCAD. Secondly, we initiated automated sale and delivery of our software products over the Internet, and we entered into publishing arrangements for the retail versions of our software with strategic partners throughout the world.
"Thirdly, we have renewed development of ArtToday.com, one of the world's largest Internet graphics sites. Finally, the company has initiated two new business divisions: (1) HomeDesignToday.com, which will offer online design tools and content, and (2) LinuxDesignToday which is developing Linux versions of our design software. We see tremendous leverage and synergy with our core technology towards realizing these opportunities."
New Online Technology Ignites Revenue Growth with Digital River, Egghead.com, Beyond.com and Others
To launch the company's Internet sales initiative, IMSI has entered into a strategic agreement with Digital River (Nasdaq: DRIV), wherein Digital River hosts IMSI's software storefront and provides the infrastructure for online promotion and sales of these products. IMSI has seen an average 20 percent month over month growth in online sales of its software over the last three months. The online order process and delivery of software via download is automated, so the costs are minimal compared with retail software sales. IMSI software can also be purchased on the Internet from other online sellers of software including Egghead.com and Beyond.com.
New Licensing Strategy To Yield More Than $2.5 Million from Worldwide Distribution Agreements
Koblick continued, "One of our main goals in restructuring the company was to find partners with strong distribution resources to relaunch worldwide our software products into retail and other channels."
IMSI has entered into publishing agreements with ValuSoft in the United States, Sumitomo (SMI) and Rock Intl. in Japan, and SoftChina for Southeast Asia. IMSI also has entered into publishing agreements with MicroBasic in Germany, Austria and German speaking parts of Switzerland, with AB Soft in France, Belgium, and French speaking parts of Switzerland, and with MediaGold for the rest of Europe, Africa and Middle East.
These distribution arrangements generate more profitable revenues to IMSI than doing direct distribution because the publisher does all manufacturing, co-op and other promotion, technical support, and shipping and fulfillment, and pays IMSI a guaranteed royalty. In April and May, IMSI also entered into licensing agreements with Corel Corp. and Jasc Software, wherein IMSI received payments for non-exclusive source code licenses of its proprietary software technology.
The above contracts are expected to generate more than $2.5 million in present and future revenues for the company.
ArtToday.com Memberships Grow to 1.5 million
IMSI has refocused its efforts and investment in growing its wholly owned subsidiary, ArtToday.com. ArtToday is a leading site for graphics content on the Web with more than 1 million graphic images, photos and fonts available online. ArtToday.com currently has more than 1.5 million members, and according to PC Data Online, it is generating approximately 1.3 million unique visitors per month. ArtToday is operating profitably and is cash-flow positive.
"Our immediate goals for ArtToday.com are to leverage and grow our base of over 100,000 paying subscribers to the site, increasing advertising revenues from our over 20 million page views per month, and grow e-commerce from our over 1 million active e-mail names. We also hope to expand our content by forging new relationships with branded content suppliers and by entering the fast emerging digital photo market," said Koblick.
New "Online Design" Technology
IMSI has just launched a separate division, focused on creating new Web-based 3D design technology to allow people to design their dream home or to do remodeling projects on the Internet. Leveraging technology which has been developed over 10 years and which forms the basis for award-winning FloorPlan3D and TurboCAD software (1999 PC Magazine Editors Choice Award and 1999 PC Direct Editors Choice Award respectively), this technology will represent a revolutionary change in home design on the Internet.
IMSI also owns and licenses thousands of pre-designed home plans, kitchens, bathrooms, fixtures, appliances, electrical and plumbing fixtures to help people design their dream home or remodeling project. Koblick continued, "Our new Web-based 3D design technology will be of benefit to hundreds of leading companies in the home design/remodeling/construction/home furnishings industry. Our goal is to partner with several of these companies and license our online 3D design software to them."
TurboCAD for Linux Announced
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