Earnings Report:
October 27, 1998 06:00 AM
ANNAPOLIS, Md., Oct. 27 /PRNewswire/ -- Condor Technology Solutions, Inc. CNDR , a leading provider of information technology solutions, today reported service revenue and net income growth of 109 percent and 77 percent, respectively, in the quarter ended Sept. 30, 1998, as compared to the pro forma results in the same quarter of 1997.
Third Quarter Results
Total revenues rose to $45 million in the third quarter of 1998, compared with $38 million in pro forma revenues for the third quarter of 1997. The company's net income in the third quarter of 1998 was $3 million, or 26 cents per diluted share, an increase of 77.3 percent over the pro forma net income in the third quarter of 1997 of $1.7 million. In the third quarter of 1998, the company's IT Service Revenue was $27.3 million, compared with $13.1 million in pro forma revenues for the third quarter of 1997, an increase of 109.1 percent. The company's Hardware Procurement Revenue for the third quarter of 1998 was $17.7 million, compared with $24.9 million in pro forma revenues for the third quarter of 1997, a decrease of 29.1 percent.
The company's gross margin grew during the third quarter of 1998 to 35.8 percent compared to 25 percent for the comparable pro forma period in 1997. The company's operating margin in the third quarter was 12.3 percent, compared to a pro forma operating margin of 7.7 percent for the comparable period in 1997. Pro forma operating results for the third quarter of 1997 do not include the costs of the corporate infrastructure.
Kenn Hill, chairman and chief executive officer, remarked, "We are extremely pleased with the strong growth of our Information Technology Service business. We continue to shift our business model to a service dominant model. During the third quarter, we saw solid growth in all of our service segments. Our business mix during the quarter included 61 percent of our revenue from the IT Service component of the business, up from 44 percent last quarter and 34 percent in the third quarter of last year."
Nine Months Results
Total pro forma revenues for the nine months ended Sept. 30, 1998 rose to $129.4 million, compared with $105.7 million in pro forma revenues for the same period in 1997. The Company's pro forma net income for the nine months ended Sept. 30, 1998 was $6.7 million or 59 cents per diluted share, an increase of 46.7 percent, over the pro forma net income for the nine months ended Sept. 30, 1997 of $4.5 million. For the nine months ended Sept. 30, 1998, the Company's pro forma IT service revenue was $63.6 million, compared with $37.9 for the same period in 1997, an increase of 68.1 percent. The Company's pro forma gross margin grew to 30.3 percent for the nine months ended Sept. 30, 1998, compared to 24.2 percent for the comparable pro forma period in 1997.
Performance Highlights
Kenn Hill, Condor's chairman and chief executive officer, said, "Our continued growth reflects the progress we have made toward becoming a strategic, full-service, single-source IT services company that provides cost-effective, synergistic solutions to our customers. Our growth strategies of expanding our organic business, making the right acquisitions, obtaining large contracts, and maintaining a lean central management structure are working."
Dan Roche, Condor's president and chief operating officer, said, "These results reflect real momentum toward achieving our desired revenue mix among our Consulting, Systems, and Desktop divisions. We are witnessing growth in both our Consulting and Systems groups, which is also indicative of the headway we are making in forging Condor companies into a single, unified team.
Bill Caragol, Condor's vice president and chief financial officer, said, "Our focus continues to be on supporting the organic growth in the 11 operating units. The continued shift toward a service-dominated business model will provide Condor with continued margin expansion in the near- and long-term. During the third quarter, the company's IT Service Revenue, excluding the effects of the DST, Louden and LINC acquisitions, increased 63.4 percent from the comparable period in the prior year."
Condor Technology Solutions, Inc.
Condor Technology Solutions, Inc. CNDR is a leading provider of full-service information technology solutions to Fortune 1000 firms, middle-market companies and government entities. Founded in 1996 and headquartered in Annapolis, Md., Condor offers complementary consulting, systems and desktop services. This unique integration offers customers a single source for virtually all information technology solutions. Condor's three divisions have offices in 24 cities with 865 employees. The company's website can be reached at condorweb.com.
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