PC DOCS Group Expects 4Q Net Of C$0.03-C$0.05/Shr
By SCOTT ADAMS
Dow Jones Newswires
June 11, 1998
TORONTO -- PC DOCS Group International Inc. (DOCSF) expects to earn 3 Canadian cents to 5 Canadian cents a share in its fourth quarter, on revenues of C$39 million to C$40 million, chief financial officer Dennis Moir told Dow Jones.
PC DOCS provided guidance to analysts Thursday about its fourth quarter, which ends June 30. But Moir said he isn't giving any guidance yet in connection with fiscal 1999.
In the third quarter, PC DOCS had net of 10 Canadian cents a share, excluding charges, on revenues of C$34.5 million. In the nine months, it had net of 18 Canadian cents a share, excluding charges, on revenues of C$90.2 million.
Moir said fourth-quarter earnings will be below the third-quarter net because the company is expensing more costs, rather than capitalizing them.
As well, this will be the first quarter that Fulcum Technologies' results will be fully included PC DOCS' quarterly results, and Fulcrum was unprofitable before PC DOCS acquired it. The Fulcrum acquisition closed March 10. PC DOCS makes data management software and Fulcrum makes data retrieval software, and PC DOCS is integrating the two.
Michel DeLavergne, an analyst with Dlouhy Investments, said PC DOCS' net per share will be lower in the fourth quarter than in the third because there are more shares outstanding and the company's tax rate has increased.
For the past few months, analysts haven't been able to make reliable projections about PC DOCS because of management changes and because of the integration of Fulcrum. Thursday's guidance was the most analysts had receieved in weeks. DeLavergne added that it's also been difficult to make projections because Fulcrum's results haven't been available for a while.
DeLavergne is in the midst of revising his projections for PC DOCS' fiscal 1999, but said he's expecting net of about 50 Canadian cents to 60 Canadian cents a share on revenues of about C$180 million. He described the guidance he received Thursday as not a "big surprise."
Duncan Stewart, partner at Tera Capital Corp., said generally, observers expect PC DOCS to earn about 70 Canadian cents a share in fiscal 1999. He said the price targets on the stock are about C$17, based on 20 times expected fiscal 1999 earnings and C$3 a share of cash the company holds.
Pierre Boucher of HSBC Securities wouldn't disclose his projections, but said that if PC DOCS can turn its operations around in fiscal 1999, the "upside potential is considerable."
-By Scott Adams; 416-943-7800
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