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TSR Announces Financial Results
Business Wire - July 22, 1997 15:00
HAUPPAUGE, N.Y.--(BUSINESS WIRE)--July 22, 1997--TSR Inc.
(NASDAQ:TSRI), a provider of computer programming services and Year 2000
software solutions, today reported operating results for the three months
and fiscal year ended May 31, 1997. The comparative results are:
Three Months Ended Year Ended
May 31, May 31,
1997 1996 1997 1996
Revenues $14,958,000 $ 8,632,000 $49,704,000 $31,810,000
Operating expenses 13,891,000 8,140,000 46,734,000 30,354,000
Income from
operations 1,067,000 492,000 2,970,000 1,456,000
Other income: 40,000 63,000 297,000 250,000
Pre-tax income 1,107,000 555,000 3,267,000 1,706,000
Income taxes 515,000 229,000 1,471,000 742,000
Net income $ 592,000 $ 326,000 $ 1,796,000 $ 964,000
Earnings per
share $ 0.20 $ 0.11 $ 0.62 $ 0.32
Average shares
outstanding 2,914,000 2,930,000 2,914,000 2,996,000
NOTE: Earnings per share and the average shares outstanding have been
adjusted for a two for one stock split declared Oct. 10, 1996 and paid Nov.
14, 1996.
J.F. Hughes, president, stated, "The increase in operating income for both the
current three months and fiscal year occurred primarily because of revenue
growth of 73% and 65% respectively, in the contract programming services
business. Such increase is directly attributable to an increase in the number
of programmers on billing with customers which primarily occurred in the
first and second quarters of fiscal 1997.
"Contract programming services revenues for the first quarter of fiscal
1998 will probably not continue to increase because an unusually high
number of consultants went off billing in May and June as a result of the
completion of a large client project. "During the current quarter and fiscal
year, TSR incurred operating expenses of $455,000 and $758,000
respectively, in connection with the development and marketing costs of
Catch/21, our Year 2000 compliance solution. Corresponding Year 2000
revenues were $125,000 and $171,000 for the quarter and fiscal year. Year
2000 development, production and marketing expenses are expected to rise
as planned by an estimated $400,000 in the first quarter of fiscal 1998 and
these expenses may impact first quarter earnings. "We are pleased with the
progress to date of our Year 2000 business. Thus far, we have successfully
converted 2,300,000 lines of code (a portion of which is subject to ongoing
testing by the clients). We have agreements with several major firms under
which we are converting IBM mainframe applications. We are currently
converting applications having approximately 1,000,000 lines of code and, as
a result of our successful conversion production, we expect to be provided
with significant additional lines of code for conversion from our client base.
We are also developing a good base of prospects which we expect will result
in additional conversion projects in the next couple of months. However
there can be no assurance that these prospects will become significant
clients. Our agreements do not provide for a minimum number of lines of
code to be converted or minimum payments. All our Year 2000 revenues are
conditioned on satisfactory conversion of the client's application. "While TSR
is expanding its capacity to perform Year 2000 conversions, this business is
still in the early stages and we are unable to predict the extent to which we
will obtain additional applications for Year 2000 conversion or the receipt
of revenues from this business."
CONTACT: TSR Inc., Hauppauge
J.F. Hughes, 516/231-0333
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