Year on year, relational database software and client/server development tool supplier Sybase made a net loss of $79.0m for 1996, compared to a $19.5m loss in the previous fiscal. Even worse, in a market where rivals Informix and Oracle are experiencing rapid growth, the battered rdbms company’s growth rate has slowed almost to a stop. In 1994 it grew an enviable 71%; in 1995 this had already slipped to 16%; and for 1996 it has trickled to 5.7%, or $54.9m, inching up from $956.6m to $1.01bn. The $79m loss includes the $49.2m hit it took in its third quarter to cover restructuring. With that factored in, one can allow President and Chief Operating Officer Mitch Kertzman, who replaced Sybase co-founder Mark Hoffman in July, his comment that the company returned to profitability in the second half. – but that by a measly combined $5.7m ($0.6m in the third quarter before charges, $5.1m in the fourth) before losses, of course. A net income of less than $6m for a billion dollar company in a growth market in a strong economy is no reason to cheer, to say the least. The company may have made decent money for a change in the traditionally strong end of year period, but it has still burnt through $68m of its cash reserves in 1996 (now down to $156m), and the state of the core revenue generator for the company, actual software product, is little short of disastrous. License fees are actually down over $20m from fourth quarter 1995 to fourth quarter 1996 – $179.1m to $159.9m; the fact that Sybase can say revenues are up overall year on year is down to the fact that services have plugged the gap, so that year on year sales for the three month period has scraped up from $267.3m to $267.8m. Net income is equivalent for the period, too – $5.9m in 1995 and $5.1m in 1996, though still down. The results were announced after the markets closed; share price at the end of Thursday stood at $18, up from its 52-week low of $13 but way off its year high of $35. The entire company is focused on profitable growth and customer satisfaction and we are all looking forward to 1997, added Kertzman. You can say that again.
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