Corel Posts 4Q Loss, Sees Better Times AheadCorel Posts 4Q Loss, Sees Better Times Ahead

Corel Corp. says it will return to profitability this year, but the software marker posted a wider-than-expected fourth-quarter loss Monday.

Corel, best known for WordPerfect and CorelDraw and battling for market share against rivals such as Microsoft and Adobe Systems Inc., will launch more than a dozen new products or upgrades this year and said that it could see an increase in sales. It has cut 22% of its staff as it struggles with weak customer spending and an aging product line.

The company posted a net loss of $27.8 million, or 30 cents per share, in the quarter ended Nov. 30, up from a year-earlier loss of $10.7 million, or 14 cents a share. One broker expected the company to report a loss of 12 cents per share, according to research firm Thomson First Call.

Corel reported fourth-quarter revenue of $33.5 million, up from $31.6 million for the fourth quarter of 2001 and $31.3 million in the third quarter. The sales were slightly below company guidance in September of $34 million to $38 million.

The net loss for the fourth quarter included a charge of $5.9 million for severance costs and $17.2 million for the write-down of nontangible assets of technology and goodwill.

For fiscal 2002, the net loss was $96.4 million, or $1.09 a share, up from the year-ago loss of $7.3 million, or 17 cents a share. Sales dropped 6% year over year, to $126.7 million from $134.3 million.

The company begins 2003 with a strong cash position, no long-term debt, and a clean balance sheet, president and CEO Derek Burney says. Corel will continue to expand its network of partnerships in order to increase its presence in the enterprise and serve markets where adoption is driven by the increasing reliance on mobile devices and the growth of Web services, he adds.

Corel revealed layoffs in November, which left it with a staff of 769. Savings from the layoffs, expected to cut payroll costs by $12 million annually, will take effect in the first quarter.