At a presentation at its annual Planet user conference this week, CFO Bill Beecher provided an update on the re-auditing status, and reiterated that the company expects to file in June its 10K and 10Q for the first quarter, as previously announced. He said that while the re-auditing covers all operations, the irregularities are expected to be confined to the way licenses were recognized, whereby license fees were recognized upfront rather than on an accounting basis.
He also said that the investigation into 1999 would not be a technical re-audit but a review, but 2000 and 2001 will be re-audited. Responding to rumors that the company has received notice regarding the $350m bonds it holds, Beecher said this was not the case.
The Dallas, Texas-based company plans to appeal against its Nasdaq delisting on the grounds that its delisting notification was based on its failure to file its 10K notice. As it expects to file this in June, it is hopeful that the grounds for delisting will be removed. It is also considering a reverse stock split to address the minimum $1 price issue.
On a more positive note, in an effort to assuage fears about its ongoing viability, he said that i2 achieved an operating profit in the fourth quarter, and even though it is subject to re-audit, he expects it to stand. Although the first-quarter 2003 figures have not been released, he revealed that the company ended the quarter with $441m in cash and investments. Cash burn was $16m and of that $13m was related to restructuring. This information was designed to show that the company has got the financial situation under control, while Sidhu stressed that its hurdles related to historic events.
Customers appear to be sticking with i2, and Sidhu said that 85% of existing customers are on maintenance, and the number of customers it lost during its troubled period was negligible.
Source: Computerwire
