Embattled software company Corel, which has seen its fortunes go up and down more often than an elevator, will post a profit in its first quarter, two quarters ahead of the company's scheduled return to the black.
The company said Thursday that it expects to report
net income of $500,000 on revenues of $32.5 million.
But that revenue figure is below internal expectations,
officials noted. Shares were up 6 cents to $2.06 in
Corel makes business and graphics software for various
Company officials did say they were unsure whether the
shortfall will be deferred to later quarters when new
product versions are released, and whether profit can
continue in the second quarter.
"We are pleased with these early signs of success with our new strategic direction for the company," CEO
Derek Burney said in a release. "While our revenues are
lower than expected, our positive operating cash flow
and earnings make it clear our hard work is paying
The company missed estimates for the fourth quarter,
although it said it expected to see growth this year. It
posted a net loss for that quarter of $8.6 million, or 12
cents per share, on sales of $40.4 million.
Only two analysts reported predictions for the first quarter, according to First Call, and they were expecting an average loss of 3 cents per share.
Corel has struggled since its proposed merger with
Inprise fell apart last year. The company replaced flamboyant CEO Michael Cowpland with
Burney in August, and got a helping hand from
Microsoft in October, in the form of a
$135 million cash infusion.
Corel announced a restructuring plan in January, saying
it would focus on core products such as the
WordPerfect Office desktop suite, the CorelDraw
drawing program, and other future "creative" products,
especially for the Apple Mac market.
In February, Chief Financial Officer John Blaine said
that Corel expected to see a slight dip in revenues in
the first quarter, with revenues for each quarter growing
over the year-ago figures. Annual revenue growth is
expected to be 18 percent to 20 percent, and the
company hopes to boost sales 20 percent a year for
the next three years.