Has anybody ever posted CEO's February letter to shareholders?|
Thoughts on Q4 results and looking forward!
SUMMARY - We are positioned to execute on our top line. Our products are there.
Our positioning is there. Our balance sheet is stronger than it has been in years.
While we continue to focus on demand creation and demand fulfillment, we will
now focus mostly on sales execution. Although we did show some growth during
the quarter, we did not have Raima's products in our numbers last year. Given
this comparison, our numbers are slightly down for the quarter. On the positive
side, we are beginning to book design wins for eSNAPP, RDM, Velocis and CTD
with our focus in B2B e-Business and Information Appliance solutions. Some of
these we have announced. Some we will announce soon. Our consulting
business is taking hold, up nearly 150% year over year. These will translate into
future royalty revenues and we will grow.
Let me say at the outset that we wanted to grow the business materially in Q4.
Although we closed great design wins (the proof points to our story), these wins
did not translate into enough top-line revenue growth. With many of the other
elements now in place, our focus shifts to growing our business and becoming
recognized as business leaders in these new markets.
Our spending remains under control and continues to be in alignment with our
operating plans. We have ramped up our market development and sales staff in
order to bring our solutions to market more rapidly. This is the organizational
investment we made during last quarter and announced late last year. Further,
we have action plans to bring our general and administrative expenses into
alignment with industry best practices.
We recently announced our new open-source product called db.linux for
Information Appliances. It is truly open source in the sense that it will be free for
both development and deployment. Our contention is that the value of the
information is in its dynamic accessibility and its security. Accordingly, our
business model is to establish an ecosystem with db.linux and to increase our
value proposition to our customers by enabling eSNAPP and our patent-pending
SafeGarde technology for secure dynamic connectivity. Additionally, CTD2000
will soon be available to build e-Business applications and Velocis Database
Server delivers e-Business solutions for Linux, Unix and Windows NT. db.linux
generated a great deal of interest at Linuxworld in New York City. We will
leverage that excitement in the near-term by engaging in design wins that
include other Centura solutions
Looking forward, we should grow approximately 20% for this year. This would
put us in line to perform better than $60 million in 2000. We have set up our new
EB and IA Strategic Business Units (SBU), focusing on certain vertical markets for
extending business systems to Information Appliances. To set the appropriate
expectation, we are expecting to run the business at operating income
break-even levels for the next couple of quarters. By my nature I am a cash flow
and profit driven CEO. However, I want to leverage our lead in this market and
will continue to invest in both market development and porting our technology to
new platforms. We are the most open, compelling and comprehensive company
in our market. We plan to do better than these estimates would indicate, but I
think it imprudent to set an unreasonable expectation and miss. I would rather
come in on the high side of the numbers. I do expect profitability in Q3 and Q4
and for the year as a whole, however.
Finally, I am excited about our growth opportunities over the next few years as
we continue to build Centura brick by brick, customer by customer, for the long
term. If you have any questions, please contact me via my e-mail shown below.
Scott Broomfield is Chairman & CEO of Centura Software Corporation located in the heart of
Silicon Valley, California. Mr. Broomfield also is a Board Member of Cam DATA corporation,
BENS Advisory Counsel and an active member of President Clinton's CIAO task force. You
can reach Scott at firstname.lastname@example.org.
Except for the historical information contained herein, the matters discussed in this news
release are forward looking statements that involve risks and uncertainties, including but
not limited to the Company's failure to timely develop new products which gain market
acceptance, failure of the Company's significant resellers or distributors to renew
agreements, delays in the timing of orders for the Company's products and services,
significant changes in the business environment in which the Company operates, the
effectiveness of the Company's management in executing the Company's recent strategic
changes, and the other risks detailed from time to time in the Company's SEC reports,
including the Annual Report on Form 10-K for the fiscal year ended December 31, 1998.