Informission Q2 results - revenues up 119%, EPS up 166%
INFORMISSION GROUP'S REVENUES MORE THAN DOUBLE - EARNINGS PER SHARE
INCREASE 166%
MONTREAL, June 18 /CNW/ - Informission Group Inc., (TSE, MSE: IFN),
announced today a strong increase in both revenues and earnings for its second
quarter ending May 31st 1998.
Revenues for the three months ended May 31st were $6.8 million compared
to $3.1 million for the same period last year. The growth in revenues is
accompanied by a strong increase in earnings. Net earnings more than tripled
to $0.8 million. Earnings per share for the quarter increased 166% to $0.08
compared to the same period in 1997.
Revenues for the six months ended May 31st, 1998 were $ 13.0 million
compared to $ 5.2 million for the same period last year. The growth in
revenues is accompanied by an increase in earnings of 573% to $1.7 million.
Earnings per share were $0.17 compared to $0.03.
The increase in revenues is attributable to the international
partnerships and license agreements for its family of conversion solutions
RECYC-ENTREPRISE(TM), and specifically RECYC2000(TM), the year 2000 conversion
solution. Systems integration including the telecommunications division,
acquired last September, also contributed to this increase.
Informission has a strong cash position having completed an initial
public offering and subsequent over allotment of approximately $36 million net
in April of this year, and negligible debt. The Company's increasing profits
and strong cash position will allow significant investment in its sales and
marketing network, research and development activities, as well as allow for
the funding of acquisitions.
In response to trends in the growing market segments of integrators,
distributors and end-users, the Company's lead product RECYC-ENTREPRISE(TM) is
now focused on the RECYC technologies and its different modules. Its modules
include RECYC2000(TM), RECYC-EURO(TM), RECYC-ASSIST(TM), RECYC2000-AUDIT(TM)
and RECYC-WEB Objects Factory(TM).
One of these modules, RECYC-EURO(TM), has recently been successfully
launched in Europe after months of rigorous testing. Since RECYC-EURO(TM) is
based on the same re-engineering technology as RECYC2000(TM), software that
deals with Year 2000 solutions, Informission can offer Year 2000 and
Euro-currency conversion to its customers simultaneously. The RECYC2000(TM)
solution's success is undoubtedly acting as leverage for the European
conversion solution. Informission's solutions are currently promoted in Europe
directly and through its partners.
To keep pace with a rapidly expanding business, Informission has
significantly increased its personnel, and now has over 275 employees, with
four offices in Canada and one office in the United States. The opening of an
office in Paris is anticipated before the end of fiscal 1998.
''The company has experienced significant growth over the past twelve
months,'' commented Jacques Topping, Chief Executive Officer of Informission
Group Inc., ''With more partnership and licensing agreements in progress, we
see our current growth sustainable.''
Informission Group Inc.
Informission Group Inc. is an information technology company providing
innovative and cost-effective solutions for the conversion, development and
migration of information systems. The Company offers systems integration
solutions, telecommunications software and proprietary re-engineering software
products to clients primarily located in North America and Europe. Last year,
Informission Group was selected as 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.
Statement of earnings
<<
The second The two
quarter quarters
(3 months) (6 months)
ended May 31 ended May 31
Unaudited Unaudited
In thousands of dollars,
except earnings per share 1998 1997 1998 1997
------------------------------------------------------------------------
Revenues
Systems integration
solutions $ 4,449 $ 2,437 $ 8,258 $ 4,262
Software products and
related revenues 2,341 677 4,735 967
--------- -------- --------- ---------
6,790 3,114 12,993 5,229
--------- -------- --------- ---------
Costs of revenues
Systems integration
solutions 2,690 1,575 5,236 2,800
Software products and
related revenues 412 267 795 478
--------- -------- --------- ---------
3,102 1,842 6,031 3,278
--------- -------- --------- ---------
Gross profit 3,688 1,272 6,962 1,951
--------- -------- --------- ---------
Expenses
Selling and marketing 1,206 385 2,083 762
General and administrative 685 291 1,241 497
Research and development 370 168 689 250
Depreciation and
amortization 175 59 331 103
--------- -------- --------- ---------
2,436 903 4,344 1,612
--------- -------- --------- ---------
Operating income 1,252 369 2,618 339
Interest income 163 - 163 -
--------- -------- --------- ---------
Earnings before income
taxes 1,415 369 2,781 339
Income taxes 580 94 1,087 89
--------- -------- --------- ---------
NET EARNINGS $ 835 $ 275 $ 1,694 $ 250
--------- -------- --------- ---------
--------- -------- --------- ---------
Net earnings per share $ 0.08 $ 0.03 $ 0.17 $ 0.03
--------- -------- --------- ---------
--------- -------- --------- ---------
Weighted average number
of shares outstanding 10,934,146 9,223,528 10,168,920 9,216,194
--------- -------- --------- ---------
--------- -------- --------- ---------
Balance sheet
as of May 31
Unaudited
In thousands of dollars 1998 1997
------------------------------------------------------------------------
ASSETS
Current assets
Short term investments $ 34,190 $ -
Accounts receivable 6,772 2,777
Investment tax credits
receivable - 448
Work in process 990 480
Prepaid expenses 22 -
--------- -------
41,974 3,705
FIXED ASSETS Net 1,392 699
GOODWILL Net 375 -
--------- -------
$ 43,741 $ 4,404
--------- -------
--------- -------
LIABILITIES
Current liabilities
Bank indebtedness $ 616 $ 1,036
Accounts payable and
accrued liabilities 2,389 992
Income taxes payable 630 -
Deferred income taxes 168 128
Deferred revenues 249 470
Long-term debt due within
one year 150 203
--------- -------
4,202 2,829
LONG-TERM DEBT 300 1,228
--------- -------
4,502 4,057
SHAREHOLDERS' EQUITY
Share capital 38,088 240
Retained earnings 1,151 107
--------- -------
39,239 347
--------- -------
$ 43,741 $ 4,404
--------- -------
--------- -------
Statement of changes in financial position
The two quarters (6 months) ended May 31
Unaudited
In thousands of dollars 1998 1997
------------------------------------------------------------------------
NET INFLOW (OUTFLOW) OF
CASH RELATED TO THE
FOLLOWING ACTIVITIES:
OPERATING
Net earnings $ 1,694 $ 250
Items not affecting cash
Depreciation of fixed assets 247 103
Amortization of goodwill 83 -
Deferred income taxes (83) 91
--------- -------
Funds from operations 1,941 444
Changes in non-cash operating
working capital items (718) (796)
--------- -------
1,223 (352)
--------- -------
FINANCING
Issue of long-term debt 109 293
Repayment of long-term debt (1,425) (74)
Issue of shares 36,129 31
Share Capital increase
resulting from the merger 1,792 -
Deficit resulting from the merger (2,214) -
--------- -------
34,391 250
--------- -------
INVESTING
Capital expenditures, - net (523) (380)
--------- -------
INCREASE (DECREASE) IN NET
CASH POSITION 35,091 (482)
CASH (BANK INDEBTEDNESS)
AT BEGINNING (1,517) (554)
--------- -------
CASH (BANK INDEBTEDNESS)
AT END $ 33,574 $ (1,036)
--------- -------
--------- -------
>>
For further information: Mr. Claude Dor‚, CFO, (418) 627-2001
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