ServiceWare Technologies Announces Third-Quarter Financial Results(email this article)

PITTSBURGH, Oct. 30 /PRNewswire-FirstCall/ -- ServiceWare Technologies (Company Profile, Past Stories, Case Studies), Inc. (OTC Bulletin Board: SVCW - News), a leading provider of Web-based knowledge management solutions for customer service and support, today announced results for the third quarter ended Sept. 30, 2003.
ServiceWare reported revenues of $2.7 million for the third quarter, up 24.9 percent when compared with the third quarter 2002 results of $2.2 million. The net loss for the quarter was down 78 percent to $494,000, or $0.02 per share, which compared to a net loss of $2,243,000 or $0.09 per share reported in the third quarter of 2002. The company also reported EBITDA of $174,000 for the quarter. Cash balances increased $77,000 to $1.2 million at Sept. 30, 2003.

ServiceWare signed contracts with 15 customers during the quarter, including Countrywide Home Loans, the United States Patent & Trademark Office, Texas Instruments, ACS and a major international consulting firm. Several of ServiceWare's customers upgraded their solution to ServiceWare Enterprise(TM) 5.0, ServiceWare's comprehensive suite of knowledge-powered support solutions. The company also secured add-on business from existing customers, such as Cingular Wireless, AT&T Wireless, Aventis, and Best Software. Sixteen of ServiceWare's customers signed maintenance renewals, including Duke University, Vanderbilt University, California State University, Fourth Shift, EDS Corporation and H&R Block.

   Third Quarter Highlights:
    - The company reported revenues of $2.7 million, up 24.9 percent year
      over year.
    - The company reduced its net loss by 78 percent to $494,000 or $0.02 per
      share from Q3 2002 to Q3 2003.
    - The company reported EBITDA of $174,000, its second consecutive
      EBITDA-positive quarter.
    - The company reported an operating loss of $51,000, an improvement of
      $1,708,000 over Q3 2002.
    - The company ended the quarter with cash equaling $1.2 million, an
      increase of $77,000 over June 30, 2003.
    - The company signed contracts with 15 customers during the quarter,
      including Countrywide Home Loans.
    - Sixteen existing customers signed maintenance renewals during the
      quarter.
    - The company recognized 57 percent of its license revenue during the
      quarter from new customers and 43 percent from its existing client
      base.
    - The company announced a master distribution agreement with Merlin
      Information Systems LTD; as a result, ServiceWare International was
      formed as the principal ServiceWare Technologies international
      distributor.
    - In July, the company received Remedy validation and is now a certified
      vendor in Remedy's Technology Alliance Partner program.
    - In August, the company announced a strategic partnership with M-Tech
      Information Technology, a leading provider of identity management
      solutions.
    - The company bolstered its sales team by 30 percent by hiring additional
      inside sales reps to generate leads and strengthen the pipeline.
      Additional district sales managers provide the company with a stronger
      regional presence in the South and Southeast.


"We are pleased with our third quarter results and the continued progress ServiceWare has made during the year as it reported its second consecutive EBITDA positive quarter," said ServiceWare President and CEO Kent Heyman. "The continued growth of our customer base during the quarter, as well as a significant percentage of follow-on orders from our existing customers, speaks to the quality of our software products and the ROI those products offer."

Mr. Heyman continued, "Looking ahead to the fourth quarter, we are cautiously optimistic as our pipeline remains strong. We expect revenues for the fourth quarter of 2003 to be in the range of $3.0 to $3.3 million, and to announce a third consecutive EBITDA-positive quarter."

ServiceWare will present the third quarter 2003 earnings in a teleconference today at 4:30 pm ET (1:30 pm PT). The call can be accessed by dialing (800) 374-0565 and giving the company name, "ServiceWare" or over the Internet at http://www.serviceware.com in the Investor Relations area. Participants are asked to call the assigned number approximately 10 minutes before the conference call begins. A replay of the conference call will be available beginning two hours after the call until 11:59 p.m. on Nov. 4, 2003. The replay can be accessed by dialing (800) 642-1687 and entering the following pass code: 3549204. The replay of the conference call also will be available on the ServiceWare Investor Relations site or by visiting http://www.mkr- group.com .

About ServiceWare Technologies, Inc.

ServiceWare is a leading provider of Web-based knowledge management solutions for customer service and support. ServiceWare software empowers organizations to deliver superior service while reducing support costs. Powered by ServiceWare's Cognitive Processor®, a patented self-learning search technology, ServiceWare Enterprise(TM) and ServiceWare Express(TM) enable businesses to develop and manage a repository of knowledge to effectively answer inquiries over the Web and in the call center. Leading organizations have implemented ServiceWare software including EDS, H&R Block, AT&T Wireless, Cingular Wireless, Fifth Third Bancorp, Green Mountain Energy, Reuters, and QUALCOMM. Learn more today by visiting www.serviceware.com or call 1.800.572.5748. Outside North America, call our international office at +(44) (0) 1280.826345.

SmartMiner, ServiceWare Enterprise, ServiceWare Express, ServiceWare Self-Service, ServiceWare Professional, ServiceWare Architect, ServiceWare Administrator, ServiceWare Knowledge Portal and Cognitive Processor are trademarks of ServiceWare Technologies, Inc. All other trademarks are properties of their respective owners.

Statements in this press release that are not historical facts, including those statements that refer to ServiceWare's plans, prospects, expectations, strategies, intentions, hopes and beliefs, are forward-looking statements. These forward-looking statements are based on information available to ServiceWare today, and ServiceWare assumes no obligation to update these statements as circumstances change. There are risks and uncertainties that could cause actual results to differ materially from the forward- looking statements, including, without limitation, risks related to revenue expectations, ServiceWare's software strategy, fluctuations in customer demand, use of the Web as a delivery vehicle for customer support solutions, risks resulting from new product introductions, integration of acquired products with current offerings, and customer acceptance of new products, rapid technological change, risks associated with competition, continued growth in the use of the Internet, ServiceWare's ability to retain and increase revenue from existing customers and to execute agreements with new customers, and ServiceWare's ability to attract and retain qualified personnel and to secure necessary financing for its operations and business development. Risk factors are described in more detail in ServiceWare's filings with the Securities and Exchange Commission.