Abacus Direct Corporation Reports Record Full-Year
Results; Income Before Taxes Rises 110 Percent on
Revenue Growth of 88 Percent
PR Newswire - February 05, 1997 07:03
FINANCIAL ABDR ERN V%PRN P%PRN
WESTMINSTER, Colo., Feb. 5 /PRNewswire/ -- Abacus Direct Corporation
(Nasdaq: ABDR) reported record net income of $3.9 million or $.40 per share on
revenue of $17.5 million for the year ended December 31, 1996. Net income for
1995 was $2.4 million, or $.26 per share, on revenue of $9.3 million. Fourth
quarter 1996 net income was $1.3 million or $.12 per share, on revenue of
$5.1 million, compared with net income of $1.1 million or $.11 per share on
revenue of $2.9 million for the same period a year ago. Net income reflects a
tax rate of 18.5% in 1995 compared to 38.2% in 1996.
ABACUS DIRECT CORPORATION
Financial Highlights
(In millions, except earnings per share)
Three Months Ended Twelve Months Ended
December 31 December 31
1996 1995 1996 1995
Revenue $5.1 $2.9 $17.5 $9.3
Net income 1.3 1.1 3.9 2.4
Earnings per share $0.12 $0.11 $0.40 $0.26
"This was an exciting year for all of us at Abacus," noted Tony White,
Chairman and Chief Executive Officer. "Our 88% revenue increase and
110% increase in income before taxes was achieved in part through better
penetration and servicing of our existing customer base, as well as providing
an expanded product line. The market environment for the catalog industry
improved during 1996 due to catalogers absorbing the significant postage rate
hike imposed in 1995 and the fact that paper costs actually declined.
Consequently the majority of our customers mailed considerably more in
1996 then they had in 1995."
"Since we were approaching the major milestone of signing our 700th new
participant," Mr. White continued, "we increased our account representatives
staff by 50% to deliver more value to our customers. Consequently, customers
spent more money with us, as we increased product penetration among existing
clients. We continued to broaden the product line by refining our database,
increasing the number of transactions and data, including demographic data.
Through ongoing investments in technology, we substantially expanded our
computing capacity and enhanced our ability to refine housefile scoring and
list optimization products. A number of market breakthroughs in our modeling
approach improved the responsiveness of lists and enlarged universes."
"During the year," Chairman White stated, "we launched a number of
ventures including 1) Abacus E-Net giving us a faster way to distribute
products and services; 2) Our new data enhancement area enabling us to enter
new markets; and 3) Industry information reports giving our customers
information never before available to them about market share, seasonality and
competition."
"Total operating expenses increased by 85.4% for the year ended
December 31, 1996 when compared to the year ended December 31, 1995.
Contributing to the increase in expenses were significant staffing increases
in the sales and R & D departments. In the 4th quarter of 1996 we accelerated
our staff hiring plans in anticipation of 1997 growth and granted a one time
bonus payment to senior management associated with over-achievement of the
Company's goals. The Company anticipates that in the future, bonuses for
over-achievement will be incorporated into management and staff compensation
plans."
Mr. White continued, "Recognizing the seasonality in our business, revenue
decreased from $6.4 million in Q3 to $5.1 million in Q4 but were up
78.1% versus the fourth quarter a year ago. Historically Abacus recognizes
its highest quarter revenue and net income during the third quarter due to
client demands as they prepare for the holiday season. The first and second
quarters which we are now entering are historically the lowest revenue and
income generating quarters."
Abacus Direct Corporation is a leading provider of information products
and marketing research services to the direct marketing industry,
specifically, the catalog industry. The company completed its initial public
offering on September 26, 1996 at $14.00 per share, managed by Robertson,
Stephens & Company LLC, Hambrecht & Quist LLC and William Blair & Company,
LLC.
This release contains statements that are forward-looking in nature,
including those related to the Company's thresholds, operating strategy and
results, seasonality and cyclical nature of the industry. A variety of
important factors could cause actual results to differ materially from such
goals, expectations or potential results. These factors include, but are not
limited to: the actions of current and potential new competitors, rapid
changes in technology, overall economic conditions, changes in postal rates
and paper prices and the nature and the amount of the Company's revenue and
expenses.
ABACUS DIRECT CORPORATION
(Dollar amounts in thousands, except per share data)
(Unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
1996 1995 1996 1995
Revenue from operations $5,116,575 $2,872,590 $17,532,006 $9,330,942
Cost of operations 919,606 514,358 3,221,440 1,886,430
Gross Profit 4,196,969 2,358,232 14,228,057 7,444,511
Other Operating Costs
Sales and marketing 1,340,075 674,531 4,480,204 2,456,207
Research and development 220,957 106,508 760,572 406,966
General and administration 783,319 199,l12 2,677,674 1,407,596
Total Operating Expenses 2,344,351 980,152 7,918,450 4,270,768
Operating Profit 1,852,618 1,378,080 6,369,607 3,173,744
Interest and Other Income
(Expense) 50,885 (52,524) (116,001) (198,060)
Net Income Before
Income Taxes 1,903,503 1,325,557 6,253,606 2,975,683
Income tax expense 648,806 245,004(a) 2,388,906 550,000(a)
Net Income $1,254,697 $1,080,553 $3,864,700 $2,425,683
Earnings Per Common Share $0.12 $0.11 $0.40 $0.26
Weighted Average Number of
Common and Common Equivalent
Shares Outstanding 10,138,201 9,424,595 9,682,003 9,256,312
(a) 1995 earnings were not subject to a normal effective income tax rate
due to the utilization of certain tax benefits.
SOURCE Abacus Direct Corporation
CONTACT: Tony White, investors, 303-657-2800, or Karen Peck, media,
914-345-0441, both of Abacus Direct Corporation |
