ATG CEO Upbeat About Gains Despite 2Q Loss

For the quarter ended June 30, ATG reported a loss before charges of $2.8 million, or 4 cents per share, on sales of $25.2 million. That compares with a loss before charges of $17.3 million, or 61 cents per share, on sales of $35.5 million for the same quarter last year.

Wall Street analysts projected the company would lose 5 cents per share, according to Thomson Financial/First Call research.

"I am very pleased with the results this quarter," Shorthose told analysts during a Thursday afternoon conference call. "This is the fourth quarter in a row we've met or exceeded revenue guidance and [earnings per share and exceeded guidance in our cash position."

ATG reported $77.8 million in cash and equivalents at the close of the quarter. In addition to adding 26 new customers, including Merrill Lynch and Nintendo, Shorthose said the average deal increased during the quarter from $155,000 in the first quarter to $177,000 in the second quarter.

Shorthose said channel sales accounted for 10 percent of ATG revenue during the second quarter, and reiterated the company's goal to up that to 15 percent of overall revenue by the end of the year.

"Right now we're training these partners, and we expect to see an increasing revenue contribution from them over the coming quarters," Shorthose said. "So we are right on target."

Shorthose told analysts to expect new products and complementary technology alliances aimed at delivering new features and functionality to ATG's commerce and portal solutions later this summer. Key target areas for the new products include publishing, search, analytics and integration.

"Our ongoing product vision, coupled with these additional feature sets, will significantly expand our capability in direct and indirect selling solutions," Shorthose said.

Following up on some recent management reorganization announcements, Shorthose also took some time to emphasize his confidence in the company's top executives. Changes include the resignation of Bernard Bailey, COO, effective Aug. 3. Bailey is leaving ATG to take the role of CEO at a publicly traded biometrics technology company, according to ATG.

In addition, Greg Lazar was promoted from vice president of North American sales to vice president and general manager for North America. Lazar and Bernard Girbal, general manager of international operations, will assume Bailey's responsibilities until a replacement is found. ATG also appointed John Dragoon senior vice president of product management and marketing.

Looking forward, the company anticipates third-quarter 2002 revenue of between $24 million and $28 million, citing an expected seasonal decline in European sales during the period.