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IntraNet Solutions releases Q4, YE '98 results

IntraNet Solutions reports Q4 and YE '98 financial results. A Q4 '98 net revenue of $4.9 million compares with Q4 '97 revenue of $4.4 million. A net loss of $1.3 million compares with a Q3 '98 net loss from discontinued operations of $651,000. The Q4 '98 losses include a $750,000 charge to write-down the assets of the Phoenix distribution group, a discontinued business venture.

For the year, IntraNet Solutions reports revenue of $19.5 million, up 20% from YE '97. Revenues from software, technical services and support were up 27% from the same period a year earlier. Net loss for the year was $5.3 million, compared to a 1997 net loss of $3.7 million. The YE '98 net loss includes a non-cash charge of $1.6 million and preferred stock dividends of $100,000, and a $2.6 million loss and write-downs from discontinued operations.

Software, technical services and support revenue were up 25% from Q3 '98 to Q4 '98. The company realized a Q4 '98 gross profit of 39%, up from 30% in Q4 '97. For the year, gross profit increased from 25% to 31%. Gross margins increased from 25% in YE '97 to 31% in YE '98. Software, technical services and support gross margins were 56%, compared to gross margins of 41% in 1997.

The company didn't achieve their profit objective in Q4 '98, "due to slower than anticipated buying cycles" and sales & service infrastructure expenses, according to president and CEO Bob Olsen. On the plus side, the company divested most of its discontinued operations, which removed a source of losses. They also added three people to their board of directors and added a VP of sales and services. "We are going into the new year with a great deal of market momentum, brand recognition, high profile installations and a more focused organization," said Olsen.

During the quarter IntraNet Solutions released Version 3.0 of their Intra.doc Web-based document management system. The company also signed a deal with Zuno, an E-commerce provider, and won business from Allina Health System, British Biotech Pharmaceuticals, Dayton Hudson, and Wellmark Blue Cross Blue Shield of Iowa.

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