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Primus Announces Earnings, Acquisition
Under the terms of the stock-and-cash deal, Primus will purchase Broad Daylight for 2,090,000 shares of Primus common stock, plus cash equal to the value of 110,000 shares of Primus common stock.
Posted Aug 13, 2003
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Assisted service and Web-based self-service provider Primus Knowledge Solutions announced a second-quarter earnings drop, along with an acquisition that the company hopes will pay off in the long term. The company says it has reached an agreement to acquire Broad Daylight, an e-service software developer specializing in solutions for customer and employee self-service. Under the terms of the stock-and-cash deal, Primus will purchase Broad Daylight for 2,090,000 shares of Primus common stock, plus cash equal to the value of 110,000 shares of Primus common stock. Barring typical regulatory hurdles, the acquisition is expected to close next month. In a prepared statement, Michael Brochu, president and CEO of Primus, says the acquisition helps Primus address the entire customer service continuum. Broad Daylight brings to the table a roster of high-profile customers, including Cisco, Kodak, McDonald's, and SBC Communications. "Primus is trying to broaden its offerings to become a complete customer-service solution," says Sheryl Kingstone, program manager of CRM for the Yankee Group. "I also think that it might be a nice fit since it looks like many of Broad Daylight's customers probably have something on the call center side, but they might not have the knowledge base that Primus offers." Primus also this week announced earnings for its second quarter, ending June 30, 2003. Revenue was $3.7 million, down from $4.2 million for the same quarter of 2002. The company also posted a net loss was $2.7 million, which is better than the company's net loss of $3.2 million for the corresponding quarter a year ago. The company also reduced its total operating expenses from $6.3 million to $5.1 million for the second quarter last year. Brochu noted in the statement that although the company continued to see growth in its sales pipeline, it also encountered delays as many businesses pushed back the sales cycle. The upside of the delays, according to Brochu, is that Primus has already booked more license revenue for the not-yet-ended third quarter than it had for the second quarter.
Kingstone avows that Primus stands to gain, as businesses are starting to spend money to decrease calls and increase efficiencies. "Primus is in a hot area," she says. "Companies are looking to small point companies like Primus to solve their problems. The problem is that it's taking a long time for them to realize that their existing CRM providers and back-office solutions vendors don't have what they need before they turn to edge-solution providers like Primus."
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