ENGLEWOOD, Colo., Feb. 17 /PRNewswire/ -- TAVA Technologies, Inc.,
(NASDAQ:TPRO) a leading provider of automation and information technology
solutions to industry, announced results for its second fiscal quarter ending
December 31, 1997.
Revenues for the second quarter were $10,484,000 representing an increase
of $2,347,000 or 29% compared to $8,137,000 recorded in the quarter ending
December 31, 1996. Gross profit was $3,677,000 (35.1% of revenue) an increase
of 45% compared to $2,539,000 (31.2% of revenue) recorded in the quarter
ending December 31, 1996. For the second quarter ending December 31, 1997 the
company recorded earnings before taxes, interest, depreciation and
amortization of $20,000 and a net loss of $581,000 ($0.03 per share).
For the six months ending December 31, 1997, revenues were $21,803,000
representing an increase of 35% from the $16,104,000 recorded for the six
months ending December 31, 1996. The company recorded earnings before taxes,
interest, depreciation, and amortization of $62,000 and a net loss of
$1,156,000 for the six months ending December, 31, 1996 (0.07 per share).
John Jenkins, TAVA Technologies CEO, stated, "Revenue for the quarter was
essentially flat with the quarter ending September, 30, 1997 after allowing
for changes in material resale content. Revenue and gross profit in the
quarter were effected by seasonal holiday schedules that reduced billable
hours by more than 15%, and the continued dedication of significant resources
to the PlantY2K One(TM)product extension and database development.
Considering this impact, we are pleased we were able to increase our gross
profit margin to greater than 35%." During the quarter the database count
increased by approximately 7,000 items since September 30, 1997 to a current
level of over 10,500 items."
Jenkins added, "The quarter included $1,736,000 of year 2000 related
revenue, including $1,497,000 from services and $236,000 from product sales.
All Y2K engagements were pilot stage or extended inventory assessments. Gross
margins realized on Y2K activity in the quarter were reduced by significant
training, general resource mobilization expense and inefficiencies inherent in
conducting rapid deployment for single pilots across a large number of
clients. The company fully expects to see margins improve as these costs are
leveraged."
Doug Kelsall, CFO noted "Our revenue and gross profit margins fluctuate
from quarter to quarter, depending on the mix of services, product licenses
and material and subcontract resale. During the December quarter, material
and subcontract resale declined by $647,000 from the quarter ending September
30, 1997." Kelsall added, "Interest expense was down slightly from the
September quarter due to the full impact of the debt conversion of $2,685,000
in the September quarter."
Kelsall also noted, "We are pleased with the significantly improved
balance sheet. Our working capital was $8,130,000 at December 31, 1997, with
over $3,000,000 in cash. Working capital has increased $7,963,000 since June
30, 1997. Kelsall added, "TAVA has recently been approved for a $4 million
senior debt facility and $600,000 in lease financing. Documentation is in the
final stage of completion. Proceeds will be used to refinance existing senior
debt, upgrade internal computer equipment and to support working capital
requirements associated with year 2000 business growth. Refinancing our
senior debt will also allow us to further consolidate our administrative
functions. Our current cash on hand and debt financing is expected to provide
the financing necessary to support our Y2K growth."
Jenkins stated, "The company's base business continues to be solid. Year
2000 activity continues to increase with new clients added, existing clients
moving from pilots to full inventory and assessment, and some now moving to
remediation programs. We have expanded our technical staff by 43 in the last
60 days, and currently have 85 engineers engaged in Y2K activity."
Jenkins added, "Investor interest remains high with the company planning
presentations at the Hanifen-Imhoff Investor Conference on February l8th and
the Cruttenden Roth Conference in early March."
Kelsall concluded, "Our shareholders approved the name change from Topro,
Inc. to TAVA Technologies, Inc. at the shareholders meeting on January, 29,
1998. Our common stock and common stock warrants currently trade on the
NASDAQ Small-Cap under the trading symbols TPRO and TPROW respectively. On
February 18th, 1998 our trading symbols will be changed to TAVA and TAVAW."
Earnings Recap:
3 Months 3 Months 6 Months 6 Months
Ending Ending Ending Ending
Dec 31 1997 Dec 31 1996 Dec 31 1997 Dec 31 1996
Revenue 10,484 8,137 21,803 16,104
Cost of Sales 6,807 5,598 14,595 10,680
3,677 2,539 7,208 5,424
Gross Margins 35.1% 31.2% 33.1% 33.7%
SG&A 3,923 2,346 7,609 4,892
Amort of Goodwill & Cap
Sftwr 258 87 533 174
4,181 2,433 8,142 5,066
Other Income (Expenses) (77) (190) (222) (362)
Net Income (loss) (581) (84) (1,156) (4)
Average shares
outstanding 17,110,148 7,796,321 16,070,391 7,221,023
Net income (loss)
per share (0.03) (0.01) (0.07) (0.00)
Balance Sheet Info:
Assets Liabilities and Equity
Cash 3,057 Total Current Liabilities 11,421
Other Current 16,494 Long Term Liabilities 2,531
Total Current assets 19,551 Total Liabilities 13,952
Other Assets 14,314 Shareholder Equity 19,914
Total Liabilities and
Total Assets 33,865 Shareholders Equity 33,865
Statements made in this Press Release that are not historical or current
facts are "forward looking statements" made pursuant to the safe harbor
provisions of federal securities laws. Forward-looking statements represent
management's best judgment as to what may occur in the future, but are subject
to certain risks and uncertainties that could cause actual results and events
to differ materially from those presently anticipated or projected. Such
factors include adverse economic conditions, entry of new and stronger
competitors, inadequate capital, unexpected costs, failure to integrate
operations of recently acquired subsidiaries and failure to capitalize upon
access of new clientele. Specific risks and uncertainties which may affect
forward-looking statements about the Company's Plant Y2K One(TM) business and
prospects include the possibility that a competitor will develop a more
comprehensive or less expensive Y2K solution, and delays in market awareness
of Topro and its product and service solutions. These factors and others are
discussed in the "Management's Discussion and Analysis" section of the
Company's Annual Report on Form 10-KSB for the fiscal year ended June 30,
1997, to which reference should be made. |
