Intelligent Systems Announces Second Quarter 2002 Results
NORCROSS, Ga., Aug. 7 /PRNewswire-FirstCall/ -- Intelligent Systems Corporation (Amex: INS - News; www.intelsys.com ) announced today its financial results for the second quarter and year-to-date periods ended June 30, 2002.
The 2002 results are not directly comparable to the prior periods because this year the company consolidates two information technology subsidiaries that were not consolidated in the second quarter and year-to-date periods of 2001. As previously announced, the company acquired a controlling interest in VISaer, Inc., a software firm, in July 2001 and acquired a controlling interest in CoreCard Software, Inc. (formerly Delos Payment Systems, Inc.), a development stage software company, in early 2002. The company also reported significant non-recurring investment income in the second quarter of 2001 that distorts period-to-period comparisons.
For the second quarter of 2002, Intelligent Systems recorded revenue of $2,213,000 compared to $1,519,000 in the second quarter of 2001. Net loss in the second quarter of 2002 was $4,708,000 or $1.05 per basic share as compared to net income of $17,931,000 or $3.19 per basic share for the same period in 2001. For the six month period ended June 30, 2002, revenue was $4,381,000 compared to $3,213,000 in the same period last year. Net loss for the six month period of 2002 was $6,830,000 or $1.52 per basic share compared to net income of $18,680,000 or $3.32 per basic share in the year-to-date period in 2001. As noted above, the second quarter and year-to-date results last year were impacted positively by a one-time investment gain of $17.8 million related to the sale of PaySys, a former affiliate company, to First Data Corporation.
Revenue grew 46 and 36 percent in the three and six month periods in 2002 compared to the same periods in 2001 mainly due to the consolidation of VISaer revenue in 2002 and revenue growth at the company's ChemFree subsidiary in the second quarter of 2002. The company's reported losses from operations of $3.5 million and $7.1 million in the three and six month periods, respectively, of 2002 are in line with expectations. The increased operating loss compared to prior periods reflects the inclusion of expenses of VISaer and CoreCard Software in 2002, mainly for significant software development expense at both new subsidiaries.
J. Leland Strange, President and Chief Executive Officer of Intelligent Systems Corporation, said, "VISaer is developing a new Web-native version of its maintenance repair and overhaul (MRO) software and has accrued over $3.2 million in deferred revenue that is expected to grow during 2002 and be recognized when the completed software is delivered to customers in 2003. Our CoreCard Software subsidiary expects to have its first customer live on its card transaction processing software in the fourth quarter this year. Meanwhile, we are consolidating their losses and providing the main source of funding."
Results for the second quarter this year include a net investment loss of $1,339,000 that reflects primarily a write-down totaling $1,246,000 to reduce the carrying value of the company's holdings in Daw Technologies' stock which was acquired in a prior period sale of a subsidiary. Year-to-date 2002, the company's investment loss of $542,000 includes other investment gains that offset in part the investment reserves recorded in the period. The year-to- date 2002 results also include $902,000 of other income, mainly related to the recognition of deferred gain from the sale of a VISaer subsidiary in 2000. |
