Novell fourth quarter revenues down, losses up

21 Nov 2003

Network software maker Novell has reported that its revenues for the fourth quarter were US$287m, down from the US$300m reported last year. The company’s losses increased to US$109m from US$92m a year ago.

For the full year fiscal 2003, Novell’s revenues of US$1.1bn matched the US$1.1bn reported for the fiscal year 2002. However, overall net losses on the year were US$162m, down from the net loss of US$247m reported for the full year last year.

During the quarter Novell hoisted its colours firmly to the Linux mast with two strategic acquisitions, including the acquisition of Linux desktop and server software firm Ximian and an agreement to acquire SUSE Linux, one of the world’s leading suppliers of Linux software an dservices.

During the quarter the company recorded charges of US$130m to cover deferment of tax assets, restructuring and long-term investments such as the aforementioned acquisitions.

“We are pleased with the progress on operating profitability levels that we achieved in this quarter. Additionally, in our fourth quarter, we continued advancing toward many of the strategic goals we laid out at the beginning of our 2003 fiscal year,” said Jack L. Messman, Novell chairman, president and chief executive officer. “Building value for our shareholders has been a top priority for Novell during 2003. We feel that we are poised to enter fiscal year 2004 with a better positioned company in the marketplace.”

He continued: “Having taken important steps with both Ximian and SUSE Linux, we feel that the open source movement can be brought into the mainstream more expeditiously and with greater momentum,” Messman said.”The customer can be reassured that mission-critical applications can indeed run on the Linux platform, reinforced by a worldwide technical support organisation. We are responding to our customers, giving them the lower costs, flexibility and choice they have repeatedly told us they want.”

Novell, which employs 125 people at its Dublin offices, ended the fourth quarter with US$752m worth of cash and investments on its balance sheet. Cash flow from operations during the quarter was US$53m.

By John Kennedy