ATG's Sales Slip


CEO emphasizes importance of channel


Art Technology Group Thursday reported a pro forma loss of $4.2 million on sales of $30.9 million for the fourth quarter of 2001, ended Dec. 31.

While First Call/Thomson Financial had predicted a loss of $0.10 per share, ATG's pro forma losses amortized out to $0.06 per share.

Quarter over quarter, ATG's losses shrunk sequentially, and its license revenue grew. For the third quarter of 2001, ATG lost $14.5 million, or $0.21 per share. Simultaneously, the company said its license revenue climbed 39 percent from the third quarter.

Yet, compared with the corresponding quarter in 2000, ATG saw its sales halved. For the quarter ended Dec. 31, 2000, ATG earned $7.2 million, or 10 cents per share, on revenue of $62.8 million.

ATG CEO Paul Shorthose said the company signed a number of new customers in the fourth quarter of 2001, including National Public Radio and Iladro. One new deal in the quarter accounted for 10 percent of total sales for the quarter, he said.

As in the previous quarter, partners are driving about half of ATG's sales, Shorthose said. "If we focus on loyal and effective SI partners . . . I think we will do very well into the future," he said on a conference call this afternoon with financial analysts and reporters.

Shorthose cited Cap Gemini Ernst and Young and Hewlett-Packard's consulting arm as driving sales in Europe, while the e-services practices of the Big 5 firms drive the bulk of implementations in the United States, along with some regional integrators.

ATG also reported results for fiscal 2001.

Total revenue was $138.9 million, compared with $163.3 million in sales for 2000.

ATG's loss for 2001 before charges was $60.2 million, or $0.88 per diluted share. After restructuring charges of $76.9 million, the net loss was $156 million.

Earlier this month, ATG, based here, shipped its Dynamo suite of e-business software for BEA's WebLogic Server. ATG is expected to roll out Dynamo for IBM's WebSphere application server by the end of the first quarter of 2002, and products for still more companies' application servers will follow throughout the year.

Shorthose said the company is developing editions of Dynamo for BEA's application server running on HP's HP-UX and IBM's AIX operating systems. He also said the beta edition Dynamo for WebSphere would be available ahead of schedule, likely within a few weeks.

ATG closed Thursday at $5. In January 2001, its share price hovered at the $42 mark.