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October 15, 2001
- For Immediate Release
New York, NY - Caminus Corporation (Nasdaq: CAMZ), the energy industry's
leading provider of software and strategic consulting for trading and
risk management in North America and Europe, today announced that it has
signed a definitive purchase agreement to acquire the software operations
of Altra Energy Technologies, Inc.
Altra, a private company located in Houston, Texas, has its roots and
retains its dominant position in providing software systems primarily
focused on managing the transactions and physical movement of the gas/pipeline
segment of the energy industry. With over 100 customers, now including
some power and multi-fuel customers, Altra has the largest installed base
of systems in the gas segment of the market, thereby significantly enhancing
Caminus' leadership position in the energy software marketplace.
"By combining Caminus' historical strength in financial and risk management
of power transactions with Altra's expertise in managing physical logistics
and transactions in gas markets, we're creating an extremely strong suite
of integrated applications for the growing number of energy market participants
active in both gas and electricity," said David Stoner, Caminus' President
and CEO. "Further, we gain a large customer base to upgrade to a new generation
of systems. We will have the opportunity to sell our power and risk systems
to Altra customers and to sell Altra's new generation of systems to Caminus'
customers. We gain the strongest staff of gas sector subject matter experts
in the industry, and we have the opportunity to deepen the joint relationships
we already enjoy with key energy players like Conoco, PG&E and Dynegy."
Under the terms of the agreement, the acquisition will be financed with
1.975 million shares of Caminus common stock and $30 million in cash.
The transaction is expected to close in the fourth quarter, upon receipt
of applicable regulatory approvals. CIBC World Markets acted as financial
advisor to Altra.
Guidance Update
Caminus also reported today that it has adjusted its financial guidance
for the third and fourth quarters of 2001. The Company now expects total
revenues for the third quarter ended September 30, 2001 to be approximately
$15 million, compared with consensus analysts' estimates of $17.8 million.
Pro forma net income per diluted share for the third quarter is now expected
to be approximately $0.04, versus consensus analyst estimates of $0.13.
For the fourth quarter, pro forma net income per diluted share is expected
to increase to $0.27 per share from $0.23 per share.
The adjustment in third quarter guidance is a direct result of the events
of September. Prior to September 11th Caminus was on track to achieve
guidance given to investors, as it has done for all previous quarters
in its history. The Company books a large portion of its license revenue
in the last month of each quarter. This pattern is particularly true in
the third quarter because of the need to wait until the end of the European
vacation season and the North American summer power demand peaks to gain
sufficient institutional attention of our customers to close large sales.
This year business activity ceased just as the peak closing period got
underway. Certain well-qualified, anticipated license sales did not close
in September. None were lost to a competitor. All these prospects have
confirmed an intention to buy and all are expected to close in the months
ahead.
The Company's strategic and implementation consulting revenues are based
on time billing. Again, the events of September had an adverse effect.
The effective cessation of business activity and business travel for more
than a week resulted in a non-recoverable loss of some time-based billings.
The delay in closing certain license sales will reduce the level of fourth
quarter implementation consulting revenues that are driven by, but lag,
prior period license sales.
Because the Company expects to close the license transactions that slipped
from the third quarter, it is increasing its pro forma EPS guidance for
the fourth quarter of 2001 to $0.27 per share from $0.23 per share. The
revision excludes any consideration of the Altra transaction.
The Company expects Altra to add about 40% to Caminus' current stand-alone
guidance for 2002 revenues. The transaction is expected to be accretive
to Caminus pro forma earnings beginning in the 4th Quarter 2001, and the
combined operation is expected to produce growth rates and margins consistent
with prior guidance. More detailed guidance for the fourth quarter and
2002 inclusive of Altra will be provided on the Company's earnings announcement
call scheduled for October 30th.
"With respect to our near-term outlook, the tragic events of September
11th affected our ability to conduct normal business during a key period
for us," stated Mr. Stoner,. "However, as we move forward we continue
to see an excellent market environment in spite of challenging economic
conditions. The underlying strength in our business, both in North America
and Europe, is evidenced by a continued strong sales pipeline and a consistently
high win rate on competitive deals. The prospects and customers comprising
our pipeline assure us that they will continue with their plans to purchase
our products and services. We look forward to a strong fourth quarter
and confidently reiterate our very positive guidance for 2002."
Conference Call
Caminus will hold a conference call Monday morning, October 15th at 9:00
a.m. Eastern time to discuss today's announcement. To participate in the
teleconference, please dial 212-346-0175 ten minutes prior to the scheduled
start time. A replay of the conference call will be available approximately
one hour after the conclusion of the live call and will run until 11:00
a.m. Eastern Time on October 17, 2001. To access the replay, please dial
800-633-8284 (U.S.) / 858-812-6440 (Int'l) and enter the pass code of
19812505.
Caminus will also hold a live Webcast of the conference call at www.caminus.com.
Please visit the Web site about 15 minutes prior to 9:00 a.m. to download
and install any necessary audio software to access the Webcast.
About Caminus Corporation:
Caminus Corporation is a leading provider of risk management software
and strategic consulting services for participants in energy markets throughout
North America and Europe, including utilities, electrical power generating
companies, energy marketers, electric power pools, gas producers, processors,
and pipelines. Caminus offers a suite of software solutions and associated
services to enable energy market participants to manage complex risk scenarios
and effectively trade and manage energy transactions addressing multiple
energy commodities and types of risk across varied geographies.
In addition to its suite of risk management software solutions, Caminus
also provides strategic consulting services for market-related issues
within the energy sector. The company currently has over 150 energy enterprise
customers of its software solutions and strategic consulting services,
including British Energy, Consolidated Edison, Conoco, and Powergen. Caminus
is headquartered in New York, with offices in London and Cambridge, UK;
Houston and Dallas, Texas; and Calgary, Canada. For more information about
Caminus, please visit the corporate Web site at www.caminus.com.
This press release contains forward-looking statements relating to Caminus
Corporation's financial outlook for 2001, and such statements involve
a number of risks and uncertainties. Among the important factors that
could cause actual results to differ materially from those indicated by
such forward-looking statements are Caminus Corporation's lengthy sales
cycle, its dependence on large license agreements to meet revenue targets,
competition in the energy industry, continued market acceptance of Caminus
products, changes in customer requirements, Caminus Corporation's inability
to manage its growth, governmental regulations, general economic conditions
and the risk factors detailed from time to time in Caminus Corporation's
periodic reports and registration statements filed with the Securities
and Exchange Commission, including without limitation its Annual Report
on Form 10-K for the quarter ended December 31, 2000. Caminus Corporation
expressly disclaims any obligation to update or alter any of its forward-looking
statements, whether as a result of new information, future events or otherwise.
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