Q3 Results 178 Percent Increase In Earnings
September 28, 1998
MONTREAL, QUEBEC--Informission Group Inc., announced today its
financial results for its third quarter ending August 31, 1998.
Financial Highlights
Revenues for this quarter were $6.5 million compared to $3.1
million for the same period a year ago. This 110 percent increase
in revenues is accompanied by a strong increase in earnings. Net
earnings were $988,000 compared to $356,000 for the same period a
year ago representing a 178 percent increase. Earnings per share
for the third quarter increased 75 percent to $0.07 compared to
$0.04 for the same period in 1997. Informission is well
capitalized, with working capital of $38.5 million and negligible
debt.
Revenues for the nine months ended August 31, 1998 were $19.5
million compared to $8.3 million for the same period a year ago.
The growth in revenues is accompanied by an increase in net
earnings of 343 percent to $2.7 million compared to $0.6 million
last year. Earnings per share more than tripled to $0.24 compared
to $0.07.
Operational Highlights
Informission firmly established its presence in the U.S. market in
the third quarter. Informission now has agreements with 3 out of
the 5 largest systems integrators worldwide for the use of
RECYC-ENTERPRISE(TM). In addition, the Company has recently
concluded a license agreement with PacifiCare Health Systems, one
of the leading managed health care companies in the U.S..
RECYC-ENTERPRISE(TM) represents INFORMISSION's suite of
re-engineering products designed to assist in renovation projects,
whether it involves Y2K, EURO or Web-Centric development.
In the international market, Informission announced this quarter
that it licensed DTS Software Latin America Inc. to distribute
RECYC-ENTERPRISE(TM) through its extensive sales network in Latin
America. The Company continued its operations in Europe, more
recently from its office in Paris, France to better address the
Euro currency conversion situation with RECYC-EURO(TM), define and
develop new marketing activities and maintain already existing and
very active partnerships.
During this period, Informission's management team has also
actively pursued the implementation of its acquisition program.
The Company is currently holding discussions with specialized
firms in telecommunications software and Web centric technologies
and is aiming to conclude an agreement before the end of this
fiscal year.
Prospects
Considering its work in progress and its order book, the Company
is very optimistic about the next quarter and months to come.
Informission Group Inc.
Informission Group Inc. is an information technology company
providing throughout the world proprietary re-engineering and
telecommunication software as well as system integration
solutions. Last year, Informission Group was selected one of the
50 best-managed private companies in Canada by Arthur Andersen and
the Financial Post. The Company was certified ISO 9001 in 1995.
/T/
INFORMISSION GROUP INC.
STATEMENT OF EARNINGS
The third quarter The three quarters
(3 months) ended (9 months) ended
August 31st August 31st
Unaudited Unaudited
In thousands of dollars,
except earnings per share 1998 1997 1998 1997
------------------------------------------------------------------------
Revenues
Systems integration
solutions $ 4,381 $ 2,397 $ 12,635 $ 6,658
Software products
and related revenues 2,168 684 6,907 1,651
-------- ------- -------- ---------
6,549 3,081 19,542 8,309
-------- ------- -------- ---------
Costs of revenues
System integration
solutions 2,573 1,338 7,809 4,137
Software products and
related revenues 397 233 1,192 711
--------- ------- ------- --------
2,970 1,571 9,001 4,848
--------- ------- ------- --------
Gross profit 3,579 1,510 10,541 3,461
--------- ------- ------- --------
Expenses
Selling and marketing 1,118 449 3,200 1,212
General and administrative 610 305 1,852 803
Research and development 382 111 1,071 361
Depreciation and
amortization 187 72 517 174
--------- ------ ------- -------
2,297 937 6,640 2,550
--------- ------ ------- -------
Operating income 1,282 573 3,901 911
Interest income 411 - 574 -
--------- ------ ------- -------
Earnings before income
taxes 1,693 573 4,475 911
Income taxes 705 217 1,792 306
--------- ------ ------- -------
NET EARNINGS $ 988 $ 356 $ 2,683 $ 605
--------- ------ ------- -------
--------- ------ ------- -------
Net earnings per share $ 0.07 $ 0.04 $ 0.24 $ 0.07
--------- ------ ------- -------
--------- ------ ------- -------
Weighted average number
of shares outstanding 13,214,634 9,237,962 11,191,573 9,223,503
---------- --------- ---------- ---------
---------- --------- ---------- ---------
GROUPE INFORMISSION INC.
BALANCE SHEET as of August 31st
Unaudited
In thousands of dollars 1998 1997
------------------------------------------------------------------------
ASSETS
Current assets
Cash $ 329 $ -
Short term investments 32,322 -
Accounts receivable 6,661 3,725
Income taxes receivable - 387
Work in process 1,354 367
Prepaid expenses 21 -
--------- ----------
40,687 4,479
FIXED ASSETS - Net 1,507 872
GOODWILL - Net 333 -
--------- ----------
$ 42,527 $ 5,351
--------- ----------
--------- ----------
LIABILITIES
Current liabilities
Bank indebtedness $ - $ 1,363
Accounts payable and accrued liabilities 1,664 675
Income taxes payable 7 -
Deferred income taxes 215 156
Deferred revenues 112 870
Long-term debt due within one year 225 229
---------- ---------
2,223 3,293
LONG-TERM DEBT 225 1,350
---------- ---------
2,448 4,643
SHAREHOLDERS' EQUITY
Share capital 37,939 245
Retained earnings 2,140 463
40,079 708
$ 42,527 $ 5,351
INFORMISSION GROUP INC.
STATEMENT OF CHANGES IN FINANCIAL POSITION
The three quarters (9 months)
ended August 31st
Unaudited
In thousands of dollars 1998 1997
----------------------------------------------------------------------
NET INFLOW (OUTFLOW) OF CASH RELATED
TO THE FOLLOWING ACTIVITIES
OPERATING
Net earnings $ 2,683 $ 605
ITEMS NOT AFFECTING CASH
Depreciation of fixed assets 393 174
Amortization of goodwill 124 -
Deferred income taxes (36) 119
----------- -----------
Funds from operations 3,164 898
Changes in non-cash operating working
capital items (2,878) (1,486)
----------- -----------
286 (588)
----------- -----------
FINANCING
Issue of long-term debt 109 374
Repayment of long-term debt (1,425) (6)
Issue of shares 35,982 36
----------- -----------
34,666 404
----------- -----------
INVESTING
Capital expenditures - net (784) (625)
----------- -----------
INCREASE (DECREASE) IN NET CASH POSITION 34,168 (809)
CASH (BANK INDEBTEDNESS) AT BEGINNING (1,517) (554)
----------- -----------
CASH (BANK INDEBTEDNESS) AT END $ 32,651 $ (1,363)
----------- -----------
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FOR FURTHER INFORMATION PLEASE CONTACT:
Informission Group Inc.
Claude Dore
CFO
(418) 627-2001
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