A 57 per cent collapse in European revenues contributed substantially to a $140 million dollar quarterly loss, reported by Informix on Thursday. The figure, which was greater than the total revenues for the quarter, was even worse than the most pessimistic Wall Street predictions.
Revenues for the quarter were $133.7 million, down 34 per cent on the comparable period in 1996. Global licence revenue fell from $151.2 million last year to $71.7 million in 1997. The loss per share for stockholders was 93 cents, almost three times as much as most Wall Street analysts had expected.
As Wall Street struggled to come to terms with the scale of the losses, the company?s problems were compounded by the sudden resignation of its chief finance officer Alan Henricks, who had only been in the post since the departure of his predecessor last December. A recruitment firm has been hired to find a replacement.
In the meantime, it was left to chief executive Phil White to field financial analysts' questions following the release of the results on Thursday morning. "We screwed it up," he admitted bluntly. "This is probably the most trying period I?ve been through. I?ve never seen everything collapse at once like it did in the first quarter."
Among the problems identified by White as contributing to the massive losses were a collapse in European revenue, inaccurate sales forecasting, an inexperienced salesforce that was misdirected to sell the wrong product and an overly ambitious attempt to introduce a new sales channel in the shape of Informix superstores.
The collapse of the company?s European subsidiary is perhaps the greatest shock in a generally appalling financial report. European revenues crashed by 57 per cent from last year?s figure of $84.8 million to $36.5 million in the first quarter of 1997. In contrast, US revenues fell by 15 per cent from $81 million to 69.1 million.
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