San Jose, Calif., July 19, 2002 - LogicVision, Inc. (Nasdaq: LGVN), a leading provider of embedded test IP for integrated circuits and systems, today announced financial results for the second quarter ended June 30, 2002. Revenues for the quarter ended June 30, 2002 were $3.7 million, a 5% decrease from revenues of $3.9 million for the quarter ended June 30, 2001.
As stated in the Company's preliminary results released on July 2, 2002, revenues for the second quarter were below expectations due to market weakness resulting in purchase deferrals by several customers and an industry-wide delay in system-on-a-chip design starts. The Company's fundamental business and financial condition remain strong. The Company ended the second quarter 2002 with no debt on its balance sheet, and a cash and marketable securities balance of $43.9 million or $2.94 per share at June 30, 2002.
On a generally accepted accounting principles (GAAP) basis, including deferred stock-based compensation and accretion of redeemable convertible preferred stock charges, LogicVision reported a net loss of $1.9 million or ($0.13) per share for the quarter, compared with a net loss of $2.1 million or ($1.11) per share for the second quarter of 2001. On a pro-forma basis, excluding deferred stock-based compensation and accretion of redeemable convertible preferred stock charges, net loss was $1.5 million or ($0.10) per share for the second quarter of 2002, compared with a net loss of $1.4 million or ($0.73) per share for the second quarter of 2001.
Total revenues for the six months ended June 30, 2002 were $9.5 million, representing an increase of 36% compared to $7.0 million for the six months ended June 30, 2001. On a GAAP basis, LogicVision reported a net loss of $1.9 million or ($0.13) per share for the six months ended June 30, 2002, compared with a net loss of $5.1 million or $(2.65) per share for the six months ended June 30, 2001. On a pro-forma basis, net loss was $1.0 million or ($0.07) per share for the six months ended June 30, 2002, compared with a net loss of $3.6 million or ($1.89) per share for the six months ended June 30, 2001.
Vinod Agarwal, President and Chief Executive Officer said, "We are disappointed with our second quarter financial results, which are a direct reflection of the conditions impacting the entire industry. The sharp falloff in design starts and changing patterns in the order cycle are resulting in longer approval processes and purchase deferrals. With that said, our technology remains the leader in its field and we continue to use this time to further strengthen our competitive position. Two such actions we have already taken include the establishment of a direct sales subsidiary in Japan and the formation of a new engineering support and services division dedicated to providing engineering and consulting services for a total debug and test solution to our top 25 customers."
John Barnet, Chief Financial Officer, commented, "We expect the cautious customer buying behavior will remain for the next few quarters and have adjusted our forecasts to reflect our more conservative outlook. We now expect revenues in the third quarter will be in the $3.9 million to $4.0 million range. Including a charge associated with the establishment of our direct sales subsidiary in Japan, we anticipate that we will report a net loss for the third quarter 2002 on a GAAP basis in the range of $2.2 million to $2.3 million, or ($0.15) to ($0.16) per share."
Vinod Agarwal and John Barnet, Chief Financial Officer, will host an investor conference call today, July 19, 2002, at 11:00 a.m. EST to review the Company's second quarter 2002 results. The dial-in number for the live audio call beginning at 11:00 a.m. EST is 800/711-5301 (domestic) and 785/832-0201 (international). Please call in at 10:50 a.m. EST to avoid delays. A live webcast of the conference call will be available on LogicVision's Web site at www.logicvision.com .
A replay of the call will be available from 2:00 p.m. EST on Friday, July 19, 2002, through midnight EST on Friday, July 26, 2002 at www.logicvision.com and by telephone at 800/283-4642 (domestic) and 402/220-0857 (international). The confirmation identification is LOGIC.
About LogicVision Inc.
LogicVision is a leading provider of proprietary technologies for embedded test that enable the more efficient design and manufacture of complex semiconductors. LogicVision's embedded test solution allows integrated circuit designers to embed into a semiconductor design test functionality that can be used during semiconductor production and throughout the useful life of the chip. LogicVision's embedded test products generate proprietary circuit structures that are incorporated into an integrated circuit to test and diagnose the chip at full speed, without the signal delay or degradation experienced by external testers. LogicVision's embedded test solution has been successfully deployed in complex semiconductors for gigabit switches, voice and data routers, high performance servers and wireless products.
Except for the historical information contained herein, the matters set forth in this press release, including statements as to market conditions, purchase deferrals by the Company's customers, industry-wide delays in design starts and changing patterns in the order cycle that are resulting in longer approval processes and purchase deferrals, the Company's business and financial condition, including liquidity, the Company's technology leadership and competitive position, expectations regarding the newly formed engineering support and services division, customer buyer behavior and an expected charge associated with the establishment of our direct sales subsidiary in Japan, and expected revenues and net loss for the third quarter of 2002, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially, including, but not limited to, trends in capital spending in the semiconductor industry, the timing of customer orders, the impact of competitive products and alternative technological advances, and other risks detailed in LogicVision's Form 10-Q for the quarter ended March 31, 2002 and from time to time in LogicVision's SEC reports. These forward-looking statements speak only as of the date hereof. LogicVision disclaims any obligation to update these forward-looking statements.
LogicVision, Embedded Test and LogicVision logos are trademarks or registered trademarks of LogicVision Inc. in the United States and other countries. All other trademarks and service marks are the property of their respective owners.
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