eklogix reports third quarter fiscal year 2000 results
Earns 33 cents per share
MISSISSAUGA, ON, Jan. 25 /CNW/ - Teklogix International Inc., a leading
developer and marketer of wireless communication systems for supply-chain
management today announced revenues of $53 million for the third quarter ended
December 31, 1999, a 13% increase compared with the third quarter of fiscal
1999, representing 18% growth before foreign exchange effects. Net earnings
were $4.6 million, or $0.33 per share in the current quarter, compared with
net earnings of $4.4 million, or $0.32 per share reported last year.
For the first nine months of fiscal 2000, Teklogix' revenues increased
25% to $154.7 million compared with the same period a year ago, and net
earnings increased 32% to $14.0 million, or $1.00 per share, from $10.6
million, or $0.77 per share last year.
Gross profit margin in the third quarter improved to 58.5% compared with
57.5% in the same quarter last year, while expenses increased as a percentage
of revenues to 43.9% compared to 42.1% in 1999. Expenses increased in the
quarter, in part, due to accelerated spending of approximately $1 million for
engineering and market development related to the Company's Wide Area Network
(WAN) initiative. The WAN product, which offers customers an integrated
solution for local and wide-area inventory management and which represents an
annual $300 million market opportunity, is expected to be delivered in early
fiscal 2001.
"We are very pleased to report that core product revenues surged ahead
27% in the third quarter versus last year, and 34% on a volume basis, which
excludes foreign currency effects," said Ian McElroy, President and CEO.
"However, revenues from our Integration Services Group (ISG) fell sharply in
the third quarter compared to both our second quarter this year and the same
quarter last year, as prospective customers deferred implementation decisions
due in part to external Y2K concerns. We are focussing hard to regain the
revenue momentum which ISG evidenced in the first and second quarters,"
continued McElroy. "With our expectation of continuing strength in core
markets, we anticipate meeting our full year earnings plan for fiscal 2000."
The company generated $6.5 million from operations in the third quarter
before $2.8 million in additional working capital investment, for a net
improvement of $3.7 million in cash provided by operating activities in the
quarter. As a result of increased cash generation, cash used in operating
activities for the nine month period improved to $2.6 million at December 31
from $6.3 million at September 30, 1999. The company had cash and short-term
deposits of $6.2 million at December 31, 1999, and had operating borrowings of
$6.9 million. Shareholders' equity improved to $81.7 million at December 31,
1999 from $61.3 million last year.
Teklogix is a global leader in wireless data communications and enabling
software for supply chain and inventory management. The company designs,
manufactures, markets, and supports large-scale systems and products for
corporations with a mobile workforce and a need for real-time interactive data
communications. The company's systems are typically used by large-scale
organizations in the manufacturing, retail, transportation and service
industries. An estimated 6,000 Teklogix systems are installed in more than 50
countries worldwide. The company has 38 sales and support offices and 26
independent distributors throughout North America, Europe, Asia, Australia,
and South & Latin America.
TEKLOGIX INTERNATIONAL INC.
CONSOLIDATED BALANCE SHEETS
AS AT DECEMBER 31
(unaudited)
(expressed in thousands of dollars) 1999 1998
--------- ---------
ASSETS
Current
Cash and short term deposits $6,208 $10,358
Accounts receivable 55,658 37,051
Inventories 28,106 21,940
Income taxes recoverable 1,636 --
Prepaid expenses and deposits 4,015 1,387
Shareholder loans receivable 15 35
Deferred income taxes 4,224 4,283
Discontinued operations -- 1,381
--------- ---------
Total current assets 99,862 76,435
Capital assets, net 27,429 23,826
Shareholder loans receivable 232 425
--------- ---------
$127,523 $100,686
--------- ---------
--------- ---------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Bank indebtedness $6,908 $ --
Accounts payable and accrued liabilities 29,472 27,795
Income taxes payable -- 412
Deferred revenue 9,398 6,672
Current portion of long-term debt 21 1,470
Discontinued operations -- 458
--------- ---------
Total current liabilities 45,799 36,807
Long-term debt -- 2,613
--------- ---------
Total liabilities 45,799 39,420
--------- ---------
Shareholders' equity
Share capital 35,593 33,823
Retained earnings 46,131 27,443
--------- ---------
Total shareholders' equity 81,724 61,266
--------- ---------
$127,523 $100,686
--------- ---------
--------- ---------
TEKLOGIX INTERNATIONAL INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE PERIOD ENDED DECEMBER 31
(unaudited)
Three Months Ended (expressed in thousands Nine Months Ended
December 31 of dollars, December 31
--------------------- except share and ----------------------
1999 1998 per share amounts) 1999 1998
---------- ---------- ----------- ----------
$53,015 $46,973 Revenues $154,695 $124,203
22,004 19,963 Cost of sales 63,365 53,448
---------- ---------- ----------- ----------
31,011 27,010 Gross profit 91,330 70,755
---------- ---------- ----------- ----------
Expenses
4,290 3,146 Research and development 11,690 8,626
16,216 14,420 Selling and marketing 46,129 38,055
2,789 2,193 General and administrative 10,121 6,462
---------- ---------- ----------- ----------
23,295 19,759 67,940 53,143
---------- ---------- ----------- ----------
7,716 7,251 Income before income taxes 23,390 17,612
3,086 2,827 Provision for income taxes 9,356 6,971
---------- ---------- ----------- ----------
$4,630 $4,424 Net income for the period $14,034 $10,641
---------- ---------- ----------- ----------
---------- ---------- ----------- ----------
Weighted average number
14,122,171 13,883,473 of shares 14,072,642 13,886,740
---------- ---------- ----------- ----------
---------- ---------- ----------- ----------
$0.33 $0.32 Basic earnings per share $1.00 $0.77
---------- ---------- ----------- ----------
---------- ---------- ----------- ----------
Fully diluted
$0.31 $0.30 earnings per share $0.94 $0.72
---------- ---------- ----------- ----------
---------- ---------- ----------- ----------
TEKLOGIX INTERNATIONAL INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE PERIOD ENDED DECEMBER 31
(unaudited)
Three Months Ended Nine Months Ended
December 31 December 31
--------------------- ----------------------
1999 1998 1999 1998
---------- ---------- ----------- ----------
100.0% 100.0% Revenues 100.0% 100.0%
41.5% 42.5% Cost of sales 41.0% 43.0%
---------- ---------- ----------- ----------
58.5% 57.5% Gross profit 59.0% 57.0%
---------- ---------- ----------- ----------
Expenses
8.1% 6.7% Research and development 7.6% 6.9%
30.6% 30.7% Selling and marketing 29.8% 30.6%
5.3% 4.7% General and administrative 6.5% 5.2%
---------- ---------- ----------- ----------
43.9% 42.1% 43.9% 42.8%
---------- ---------- ----------- ----------
14.6% 15.4% Income before income taxes 15.1% 14.2%
5.8% 6.0% Provision for income taxes 6.0% 5.6%
---------- ---------- ----------- ----------
8.7% 9.4% Net income for the period 9.1% 8.6%
---------- ---------- ----------- ----------
---------- ---------- ----------- ----------
TEKLOGIX INTERNATIONAL INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE PERIOD ENDED DECEMBER 31
(unaudited)
Three Months Ended Nine Months Ended
December 31 December 31
------------------ -----------------
1999 1998 (expressed in thousands of dollars) 1999 1998
------- --------- -------- -------
OPERATING ACTIVITIES
$4,630 $4,424 Income from continuing operations $14,034 $10,641
for the period
Add (deduct) items not affecting cash
60 80 Deferred income taxes 180 206
-- (36) Gain on disposal of capital assets -- (36)
1,802 1,170 Depreciation and amortization 4,988 3,351
------- -------- -------- -------
6,492 5,638 19,202 14,162
Net change in non-cash working
capital balances related
(2,826) 4,225 to continuing operations (21,799) 2,674
------- -------- -------- -------
Cash provided by (used in)
3,666 9,863 operating activities (2,597) 16,836
------- -------- -------- -------
INVESTING ACTIVITIES
(3,229) (2,002) Purchase of capital assets (6,536) (4,204)
Decrease in shareholder loans
12 92 receivable 126 152
------- -------- -------- -------
(3,217) (1,910) Cash used in investing activities (6,410) (4,052)
------- -------- -------- -------
FINANCING ACTIVITIES
(7) (264) Decrease in long-term debt (423) (1,128)
Proceeds from issuance of
861 276 common shares 1,373 334
------- -------- -------- -------
Cash provided by (used in)
854 12 financing activities 950 (794)
------- -------- -------- -------
Net increase (decrease) in cash
1,303 7,965 Continuing operations (8,057) 11,990
-- -- Discontinued operations -- (792)
------- -------- -------- -------
Net increase (decrease) in cash
1,303 7,965 during the period (8,057) 11,198
(2,003) 2,393 Cash position, beginning of period 7,357 (840)
------- -------- -------- -------
($700) $10,358 Cash position, end of period ($700) $10,358
------- -------- -------- -------
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%SEDAR: 00002715E
-0- 01/25/2000
For further information: Gordon Wilde, VP Finance & CFO, (905) 812-6220
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