To all...impressive!
Saville Announces 1998 Third Quarter Results; Third Quarter Revenue Increases 49% Over Prior Year
Results
BURLINGTON, Mass.--(BUSINESS WIRE)--Oct. 26, 1998--Saville
Systems PLC (NASDAQ:SAVLY), a leading provider of convergent billing
and customer care software solutions for the telecommunications
industry, today announced third quarter revenue of $42.6 million,
representing a 49% increase over revenue of $28.6 million for the same
period in the previous year. Net income for the quarter ended
September 30, 1998 was $8.6 million, or $0.21 per diluted share,
compared to $6.3 million, or $0.16 per diluted share for the quarter
ended September 30, 1997.
Net income for the nine months ended September 30, 1998,
excluding a one-time charge for purchased in-process research and
development, was $26.5 million, or $0.65 per diluted share, on revenue
of $123.5 million, as compared to $16.1 million, or $0.41 per diluted
share, on revenue of $74.2 million, for the nine months ended
September 30, 1997. Including the one-time charge of $17.7 million
(net of an associated tax benefit of $1.1 million) taken in the second
quarter of 1998 for certain technology under development at the time
of acquisition and associated acquisition costs and expenses, net
income for the nine months ended September 30, 1998 was $8.8 million,
or $0.22 per diluted share. During the first nine months of 1998, cash
and short-term investment balances increased 19% to $81.8 million from
$68.8 million at December 31, 1997.
Jack Boyle, Saville's Chairman and CEO commented: "We are
particularly pleased with our overall performance in the third quarter
because, despite continued consolidation in the domestic
telecommunications marketplace, weakening credit markets and a
slowdown in global economic growth, Saville achieved revenue growth of
49% over 1997. We also added new customers in North America and
Europe, including two licenses for our Convergent Billing Platform
(CBP(R)) for Oracle(R) product. Additionally, our recent service
bureau initiative produced four contracts for our CBP for DB2/400
product. Finally, we have received positive initial feedback on the
second version of our CBP for Oracle product, which we released on
schedule in September."
Boyle added, "We continue to invest in our product lines and
service delivery capabilities. Based on our current sales pipeline,
the increasingly global nature of our business, and the continued
success of our service bureau initiative and licensing efforts, we
expect to see strong revenue growth in 1999."
Founded in 1982, Saville is a leading provider of convergent
billing and customer care solutions for the telecommunications
industry. Saville operates globally with offices in the U.S., Canada,
Ireland, Australia, Singapore, U.K. and Germany, and has more than
1,400 employees worldwide. Saville is a publicly held company, traded
on the Nasdaq National Market (US) market under the symbol SAVLY. For
more information, Saville can be reached at www.savillesys.com, or
call (+1) 781-270-6500.
This press release contains forward-looking statements, as that
term is used in Section 21E of the Securities Exchange Act of 1934,
that involve a number of risks and uncertainties. These
forward-looking statements include Mr. Boyle's comments on sales
opportunities, expected success of current initiatives, product line
investments and expected revenue growth. Important factors that could
cause actual results to differ materially from those indicated by such
forward-looking statements are set forth in the company's periodic
reports and registration statements filed with the Securities and
Exchange Commission, including in Item 2 of the company's Quarterly
Report on Form 10-Q for the quarter ended June 30, 1998, which risks
include those associated with customer concentration, intense
competition, product development and market acceptance, international
market fluctuations, the management of rapid operations expansion and
the availability of favorable tax treatment.
Note: Consolidated Statements of Income and Consolidated Balance
Sheets follow.
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Saville Systems PLC
CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
(in thousands of U.S. dollars, except share and per share data)
Three months ended Nine months ended
Sept. 30 Sept. 30 Sept. 30 Sept. 30
1998 1997 1998 1997
REVENUE
Services $ 31,332 $ 22,575 $ 92,385 $ 59,178
License fees 11,245 6,006 31,125 15,026
Total revenue 42,577 28,581 123,510 74,204
EXPENSES
Cost of services 15,505 10,852 45,616 28,337
Cost of license fees 372 165 922 381
Sales and marketing 2,194 1,600 6,302 4,324
Research and development 5,362 2,805 15,261 6,816
General and administrative 8,851 5,325 23,174 14,147
Charge for purchased
in-process research
and development -- -- 18,808 --
Total expenses 32,284 20,747 110,083 54,005
Income from operations 10,293 7,834 13,427 20,199
Other income, net 837 596 2,191 1,509
Income before income taxes 11,130 8,430 15,618 21,708
Provision for income taxes 2,560 2,096 6,814 5,416
Income before minority
interest 8,570 6,334 8,804 16,292
Minority interest
share in subsidiaries'
net income -- 50 -- 165
Net income $ 8,570 $ 6,284 $ 8,804 $ 16,127
Basic earnings per share $ 0.22 $ 0.17 $ 0.23 $ 0.44
Diluted earnings per share $ 0.21 $ 0.16 $ 0.22 $ 0.41
(in thousands)
Ordinary shares 38,679 36,965 38,352 36,541
Ordinary shares
assuming dilution 40,271 39,597 40,795 39,093
Saville Systems PLC
CONSOLIDATED BALANCE SHEETS
(in thousands of U.S. dollars, except share data amounts)
Sept. 30 Dec. 31
1998 1997
(unaudited)
Current
Cash and cash equivalents $ 37,240 $ 55,785
Short-term investments 44,604 13,015
Accounts receivable, less
allowance for doubtful accounts
of $1,740 and $1,687, respectively 37,827 22,373
Prepaid expenses and other assets 5,120 3,581
Total current assets 124,791 94,754
Property and equipment, net 12,390 10,621
Other assets, net 6,266 --
Total assets $ 143,447 $ 105,375
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Accounts payable 3,256 5,336
Accrued compensation and related benefits 6,263 5,248
Accrued expenses and other liabilities 6,555 3,084
Income taxes payable 7,302 7,167
Deferred revenue 4,358 3,402
Current portion of long-term liabilities 1,114 134
Total current liabilities 28,848 24,371
Long-term liabilities 1,213 336
Minority interest 244 366
Total liabilities 30,305 25,073
Shareholders' equity
Ordinary Shares, nominal value
$0.0025 per share
Authorized: 75,000,000
Issued and outstanding:
38,731,115 and 37,504,596 97 94
Deferred Ordinary Shares, nominal value
IR pounds sterling 1.00 per share
Authorized, issued and
outstanding: 30,000 48 48
Additional paid-in capital 62,680 37,734
Retained earnings 51,554 42,750
Accumulated other comprehensive income (1,237) (324)
Total shareholders' equity 113,142 80,302
Total liabilities and
shareholders' equity $ 143,447 $ 105,375
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