note ref to cbis
Wiztec Solutions Reports Record Revenues and Earnings for First Quarter of 1998
HERZLIA, Israel--(BUSINESS WIRE)--May 12, 1998--Wiztec Solutions Ltd. (NASDAQ: WIZTF), a leading provider of Subscriber Management Systems (SMS) for multi-channel subscription television, reported record revenues of $3.51 million for the first quarter of 1998, compared to $2.97M in the first quarter of 1997, an increase of 18%.
The gross profit in the first quarter of 1998 increased 26% to $1.79 million from $1.42 million in the first quarter of 1997 and operating income increased 28% to $690,835 from $537,855. The net profit for the quarter was a record $681,024 or $0.10 per share, up 18% from $577,028 or $0.09 per share in the same quarter last year.
"We are pleased to report record revenues and earnings for this quarter, reflecting strong performance from both new projects and existing customers," commented Yaron Polak, President and CEO of Wiztec Solutions. "This is a direct result of our strong position as a leading SMS vendor in the international Direct Broadcast Satellite (DBS) and digital cable TV markets. In this quarter, we significantly increased our presence in the United States through our alliance with CBIS. This alliance has already proven successful with the win of a major WIZARD service bureau agreement for Bell Atlantic's offering of DBS services, as announced by CBIS last month."
In the first quarter of 1998, Wiztec Solutions also announced the signing of a major contract for the client/server version of WIZARD with @Entertainment, Inc. The client/server version was installed at the customer site in Poland on schedule and accepted by @Entertainment for its launch of digital satellite Direct-To-Home (DTH) television services. In addition, @Entertainment will use WIZARD to support its current base of more than 780,000 existing cable subscribers in Poland. Wiztec Solutions has also installed the client/server version of WIZARD at Tevel Communications in Israel.
As part of the joint R&D initiative for a common next generation billing product, that is based on the client/server version of WIZARD, CBIS funds 50% of Wiztec's R&D effort. This allows Wiztec Solutions to continue to expand its R&D activities at a rapid pace. CBIS also contributes telephony and large systems know-how to ensure that the WIZARD product line will continue to evolve as the leading product for the cable, satellite, broadband and convergence communications markets.
Adds Mr. Polak, "Our proven track record in the most advanced cable TV and DTH satellite installations around the world, along with our alliance with CBIS, places Wiztec Solutions in an excellent position to win very large domestic U.S. digital Pay TV projects, especially in the dynamic DBS market. Together with CBIS, Wiztec Solutions is now in an excellent position to replicate its leading international position in the North American market."
Wiztec Solutions Ltd., develops, markets and supports computer software which provides multi-channel subscription television system operators with one of the most comprehensive and advanced subscriber management systems available. The Company's software is marketed under the WIZARD (R) trade name and incorporates subscriber management functions such as billing, collection, customer service, work order processing, equipment inventory control and customer analysis for target marketing. Wiztec's subscriber management systems are installed in eight languages in close to one hundred cable, wireless and satellite TV operations worldwide, including large operators, such as Telecom Australia and Deutsche Telekom. Wiztec Solutions is publicly traded (Nasdaq: WIZTF) and is part of the Formula Group (Nasdaq: FORTY), which is the largest public IT group in Israel. Cincinnati Bell (NYSE: CSN) through its wholly owned subsidiary CBIS owns almost 20 percent of Wiztec Solutions. Wiztec Solutions' web address is wiztecsolutions.com.
This press release contains certain statements related to possible results and trends in 1998 and beyond which are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Actual results and trends could differ materially from those projected in the forward-looking statements, which involve a number of risks and uncertainties and should be considered in conjunction with the cautionary statements contained in the periodic filings with the Securities and Exchange Commission.
WIZTEC SOLUTIONS LTD. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
March 31 December 31
1998 1997
ASSETS
CURRENT ASSETS:
Cash $ 10,405,393 $ 10,014,705
Accounts receivable:
Trade 3,871,862 3,919,050
Other 545,101 415,308
Inventory 41,674 30,526
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Total current assets 14,864,030 14,379,589
----------- ----------
NON-CURRENT TRADE 516,823 808,611
-------- -------
FIXED ASSETS:
Cost 3,017,569 2,712,888
Less - accumulated depreciation 1,208,492 924,190
---------- -------
1,809,077 1,788,698
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SOFTWARE DEVELOPMENT:
Original amount 3,791,440 3,377,185
Less - accumulated amortization 906,542 870,493
-------- -------
2,884,898 2,506,692
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GOODWILL:
Original amount 1,393,735 1,393,735
Less - accumulated amortization 241,368 206,525
-------- -------
1,152,367 1,187,210
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Total assets $21,227,195 $20,670,800
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable and accruals:
Trade $ 345,061 $ 657,266
Other 1,125,449 1,142,570
Advances from customers 477,262 255,412
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Total current liabilities 1,947,772 2,055,248
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LONG TERM LIABILITIES:
Advances from customers 237,500 262,500
Accrued severance pay, net 75,243 67,395
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Total long term liabilities 312,743 329,895
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SHAREHOLDER'S EQUITY:
Share capital 2,088,076 2,088,076
Stock options 324,716 324,716
Share premium and capital surplus 13,355,961 13,355,961
Retained earnings 3,197,927 2,516,904
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Total shareholders' equity 18,966,680 18,285,657
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Total liabilities and equity $21,227,195 $20,670,800
=========== ===========
WIZTEC SOLUTIONS LTD. AND SUBSIDIARIES
CONSOLIDATED SUMMARY OF RESULTS
Three months ended Year ended
March 31 December 31
(Unaudited)
1998 1997 1997
REVENUES $3,509,863 $2,965,607 $11,974,705
COST OF REVENUES 1,722,135 1,541,620 5,992,240
--------- --------- ---------
GROSS PROFIT 1,787,728 1,423,987 5,982,465
--------- --------- ---------
SOFTWARE DEVELOPMENT COSTS:
Expenses incurred 433,157 354,742 1,599,533
Less - amounts capitalized 414,255 284,728 1,365,088
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NET SOFTWARE DEVELOPMENT COSTS 18,902 70,014 234,445
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SELLING, GENERAL AND ADMINISTRATIVE
EXPENSES 1,077,992 816,118 3,651,830
--------- ------- ---------
OPERATING INCOME 690,835 537,855 2,096,190
FINANCIAL INCOME, net 87,306 71,205 328,223
CAPITAL LOSS ON FIXED ASSETS 2,202 0 6,091
----- -- -----
INCOME BEFORE TAXES 775,939 609,060 2,418,322
TAXES ON INCOME 94,915 32,032 288,575
------ ------ -------
NET INCOME $681,024 $577,028 $2,129,747
======== ======== ==========
EARNINGS PER SHARE:
Basic $ 0.103 $ 0.095 $ 0.344
======== ======== ==========
Diluted $ 0.098 $ 0.094 $ 0.338
======== ======== ==========
WEIGHTED AVERAGE NUMBER OF
SHARES OUTSTANDING
Basic 6,600,000 6,070,000 6,193,764
Diluted 6,923,969 6,130,906 6,295,152
CONTACT: Wiztec Solutions Ltd.
Yaron Polak, +972 9 952 6555
or Mike Laor, +972 9 952 6555
or
For Wiztec Solutions Ltd.
Dennis S. Dobson, 203/255-7902
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