ACE*COMM Corporation Announces Improved Revenues and Profits
GAITHERSBURG, Md., Oct. 27 /PRNewswire/ -- ACE*COMM Corporation (Nasdaq: ACEC)
today announced results for the first quarter of fiscal year 2000, ended September 30, 1999. Revenues
were $8.2 million for the quarter, compared to $6.7 million for the first quarter of fiscal 1999, a gain of
22% over the 1999 fiscal quarter. Net income and income per fully diluted share for the quarter were
$542,000 and $.06, respectively, compared to $89,000 and $.01, respectively, for the first quarter of
fiscal 1999.
"During the past twelve months management has worked effectively to strengthen our balance sheet,
improve our financial ratios, and build our technology and customer base to enable stronger participation
in the telecommunications and Internet markets, where we provide products and services," according to
James K. Eckler, Executive Vice President of Finance and Administration. "This quarter's results are
very gratifying, and demonstrate our customers' continuing commitment to ACE*COMM technologies."
George Jimenez, ACE*COMM's Chairman and Chief Executive Officer commented, "Improvements in
our financial picture, which began last year, continued into the first quarter with substantial growth in
both revenue and profits, compared to the same period a year ago. Results were generally in line with
our internal plan for the quarter and we expect to be on plan at year-end. We may continue to
experience effects of the Y2K slowdown, or lockdown as referred to by some in the industry, in this
period but we believe any such effects should be resolved by mid way through the March quarter."
Mr. Jimenez continued, "Strong business activity in this quarter was again generated by current
customers such as GTE/General Dynamics, IBM, Level 3, Motorola, Samsung, Telcel-Mexico, U.S.
Air Force and Winstar. Revenues from new Customers such as Bell Canada, Navitar and Southern Linc
were also realized. It is also significant that applications software and products for IP mediation, data
warehousing, and usage measurement are playing a stronger role in our business mix, as are services."
ACE*COMM also recently announced the appointment of a new President and Chief Operating
Officer, and an expanded financing arrangement with Silicon Valley Bank. The Company continues to
employ strategies focused both on domestic and international markets and on expanding the potential for
revenue from new and existing customers by offering technology based services and systems integration.
Except for historical information, the matters discussed in this news release include forward-looking
statements that are subject to certain risks and uncertainties that could cause the actual results to differ
materially from those projected, including, but not limited to: Delays or cancellations of orders due to
various factors, including business and economic conditions in the U.S. and foreign countries;
industry-wide slowdowns, such as the Y2K slowdown; customer purchasing and budgetary patterns or
lack thereof; pricing pressures and the impact of competitive products; the timely development and
acceptance of new products; manufacturing efficiencies and other risks detailed from time to time in the
Company's reports filed with the Securities Exchange Commission. About ACE*COMM:
ACE*COMM delivers product based solutions for Telecommunications and Internet services providers
worldwide. The Company develops technology, including equipment and applications software, and
provides related services for voice, conventional data networks and Internet protocol (IP) based
networks. ACE*COMM specializes in products and services that enable the capture, management,
enhancement and distribution of network data used to support carrier business operations. These
Operations Support Systems (OSS) are provided by the Company to a broad range of customers,
carrying both public and private communications traffic, and include wireless carriers, incumbent and
competitive local exchange carriers, national and international long distance carriers, internet services
providers and enterprises. ACE*COMM's products are installed in over 2,000 customer sites and
perform or support such mission critical functions as billing data collection, data mediation, billing,
customer management, network performance monitoring, alarm processing and network traffic
surveillance. The Company's systems are deployed in networks for some of the largest carriers and
enterprises in over 55 countries. To provide this range of capabilities, the Company employs the latest in
scaleable client server systems, data warehousing, data mining and real-time data delivery technology in
its solutions for carriers and enterprises, worldwide. ACE*COMM is a registered ISO 9001 quality
standard company. For more information, visit ACE*COMM on the internet at www.acecomm.com .
ACE*COMM is a registered trademark of ACE*COMM Corporation
ACE*COMM CORPORATION
BALANCE SHEETS
(in thousands)
September 30, June 30,
1999 1999
Assets (Unaudited)
Current assets:
Cash and cash equivalents $3,622 $3,424
Accounts receivable, net 8,677 6,547
Inventories, net 1,793 2,152
Note receivable 266 516
Prepaid expenses and other 621 466
Total current assets 14,979 13,105
Property and equipment, net 3,660 3,779
Capitalized software development costs, net 1,430 1,747
Other assets 67 68
Total assets $20,136 $18,699
Liabilities and Stockholders' Equity
Current liabilities:
Borrowings $1,204 $47
Accounts payable 1,081 1,517
Accrued expenses 786 797
Accrued compensation 1,910 1,621
Accrued contract costs 442 718
Deferred revenue 288 446
Total current liabilities 5,711 5,146
Noncurrent borrowings 368 74
Total liabilities 6,079 5,220
Commitments and contingencies
Stockholders' equity:
Preferred stock, $.01 par value, 5,000,000
shares authorized, 0 shares issued and
outstanding
Common stock, $.01 par value, 45,000,000
shares authorized, 8,910,559 and 8,877,628
shares issued and outstanding 89 89
Additional paid-in capital 19,933 19,897
Accumulated deficit (5,965) (6,507)
Total stockholders' equity 14,057 13,479
Total liabilities and stockholders'
equity $20,136 $18,699
ACE*COMM CORPORATION
STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
For the three months ended
September 30,
1999 1998
(Unaudited) (Unaudited)
Revenue $8,179 $6,723
Cost of revenue 3,844 3,083
Gross profit 4,335 3,640
Selling, general and administrative expense 3,530 3,175
Research and development expense 258 360
Provision for doubtful accounts 25 55
Income from operations 522 50
Interest income (24) (64)
Interest expense 4 25
Net income $542 $89
Basic net income per share $0.06 $0.01
Diluted net income per share $0.06 $0.01
Shares used in computing net income per share:
Basic 8,890 8,836
Diluted 9,120 8,893
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