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May 2, 1997updated 05 Sep 2016 12:53pm

FINANCE OFFICER QUITS AS INFORMIX REVEALS MASSIVE LOSSES

By CBR Staff Writer

Informix Software Inc produced the expected bad results with first quarter losses of $140.1m – or 0.93 per share. Revenues slumped by 34 per cent to $133.7m. As the red-splattered figures hit Wall Street it was clear that some blood would also have to be splashed around and CEO Phil White announced that Alan Hendricks, the chief financial officer since January, had decided to resign ‘effective immediately.’ As he fell on his sword, Mr Hendricks had nothing but kind words for Informix and optimism for the company’s future while Mr White praised the ‘good job’ he had done – before he vanished from the organization. The company’s losses include $7m related to the acquisition of Centerview Software and a $30.5m write-off of goodwill and long- term assets. Mr White claims they had moved quickly to boost their sales’ organization and address the causes of the company’s revenue and earnings shortfall. The company’s business suffered worldwide with European revenues down 57 per cent to $36.5m, intercontinental sales slumped 26 per cent to $28.1m while revenue in North America fell back 15 per cent to $69.1m. Attempting to find a few glimmers of light in the gloom surrounding his company, Mr White boasted of several major new contracts in the quarter including Wal-Mart stores, Carrefour, the French retailer, Occidental Chemical, American International Airways and Hussmann Corp. And the company boasted that its technological advances maintained an extensive lead over competition. Meanwhile, the so-say ‘Dirty Twelve’ scandal gathers pace – with allegations and litigations and all sorts of unpleasantness to do with the $22.2m twelve senior Informix executives, including White and his chief technology officer Michael Stonebraker, are said to have recouped by dumping their shares while still at premium prices over the period April 16, 1996 to March 31, 1997: now Informix is in the unenviable position of having five class action law suits pending against it related to this canker. The time frame indicates the period from when Informix’s stock price was just over $19, through its high of over $30 last September, when it is alleged that the executives sold a total of 960,000 shares for as much as $26-plus per share before the true facts about Informix’s troubled operations, diminished profitability, false financial statements and failed new product development efforts were revealed and [its] stock collapsed to just over $7, a low it is still at, in the words of the latest filing in the Northern District of California. In the teeth of such a storm, one has to wonder how long White can be expected to survive as head of the company.

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