Teri,
GSOF - Group 1 Software just popped due to great earnings report. Up 50%... 11 1/2 up 4.
LANHAM, Md., Feb. 12 /PRNewswire/ -- Group 1 Software (NASDAQ:GSOF)
(previously traded under the Nasdaq symbol CNET) today reported financial
results for the third fiscal quarter ended December 31, 1998. Revenues for the
third quarter grew to $18.0 million from $15.9 million. Net earnings
available to common shareholders more than doubled for the quarter to $820,000
from $379,000. Earnings per share were $0.22 compared with $0.12 for the same
period the previous year.
"The quarterly results are particularly gratifying in that all areas of
Group 1 showed growing strength," said Group 1 CEO Robert Bowen. "Even beyond
the reported results, the company closed several important contracts for
database marketing solutions. These contracts, totaling $1.6 million in
value, did not contribute to the current quarter's performance but continue
building the company's backlog; revenue will be recognized as the contracts
are performed over coming quarters," Bowen added. "Providing comprehensive
database marketing systems is a new thrust for Group 1. These contracts
provide a strong foundation in three different vertical markets: publishing,
medical, and hospitality."
"We continue to see very strong growth in sales of our electronic document
composition system, DOC1, while our core mailing efficiency products are
meeting with success in new applications such as data integrity and
identification of local tax jurisdictions," Bowen said.
For the first nine months of the fiscal year, the company reported net
earnings of $1.23 million or $0.35 per share, compared with a net loss of
$137,000 or $0.04 per share reported for the prior year. Revenue was $44.5
million, compared with $43.1 million in the same period of the prior year. At
the end of the quarter, Group 1 Software had cash and equivalents of $7.0
million and virtually no debt. For comparison, cash and equivalents were $3.7
at March 31, 1998 and $0.7 million at December 31, 1997, with $5.1 million in
short-term debt at that time.
Group 1 Software is the leading provider of software for database
marketing, electronic document systems and mailing efficiency. Group 1
supports UNIX, Windows NT and other operating systems and various computer
platforms including IBM mainframe, and AS/400, PC, Digital, HP and others.
Group 1 has offices throughout the US and in Canada, the United Kingdom and
Scandinavia. The company is also represented in Latin America, Australia and
Europe.
Certain statements made herein that are not historical are forward-looking
within the meaning of the Private Securities Litigation reform Act of 1995.
The words "estimate," "project," "intend," "expect," "believe," and similar
expressions are intended to identify forward-looking statements. These
forward-looking statements involve known and unknown risks and uncertainties.
For additional information regarding these and other risks and uncertainties
associated with the company's business, reference is made to the company's
reports filed from time to time with the Securities and Exchange Commission.
Group 1 Software is a registered trademark of Group 1 Software, Inc. All
other trademarks referred herein are the properties of their respective
owners.
GROUP 1 SOFTWARE, INC.
CONSOLIDATED STATEMENTS OF EARNINGS
(in thousands, except per share data)
Unaudited
For the For the
Three Month Nine Month
Period Ended Period Ended
December 31, December 31,
1998 1997 1998 1997
(FY99) (FY98) (FY99) (FY98)
Revenue:
Software licenses and related revenue $9,377 $8,989$21,082 $22,425
Maintenance and service revenue 8,599 6,870 23,384 20,668
Total revenue 17,976 15,859 44,466 43,093
Costs and expenses:
Software licenses expenses 3,194 2,774 7,923 7,569
Maintenance and service expenses 3,256 2,920 9,124 9,540
Research, development and indirect support 674 822 1,893 2,099
Selling and marketing 5,997 5,210 15,313 15,576
General and administrative 2,443 2,118 5,936 5,587
Provision for doubtful accounts receivable1,100 1,000 2,205 2,105
Total costs and expenses 16,664 14,844 42,394 42,476
Operating income 1,312 1,015 2,072 617
Non-operating income (expense), net 43 (104) 160 (418)
Earnings before provision for
income taxes and minority interest 1,355 911 2,232 199
Provision for income taxes 521 356 847 163
Minority interest - - - 132 83 40
Net earnings (loss) 834 423 1,302 (4)
Preferred stock dividend requirements 14 44 72 133
Net earnings (loss) available to
common stockholders $820 $379 $1,230 $(137)
Basic earnings (loss) per
share of common stock $0.22 $0.12 $0.36 $(0.04)
Diluted earnings (loss) per
share of common stock $0.22 $0.12 $0.35 $(0.04)
Basic weighted average number
of common shares outstanding 3,719 3,275 3,437 3,273
Diluted weighted average number
of common and common equivalent
shares outstanding 3,798 3,292 3,505 3,273
GROUP 1 SOFTWARE, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except per share data)
Unaudited
December 31, 1998 March 31, 1998
ASSETS
Current assets:
Cash and cash equivalents $7,014 $3,683
Trade and installment accounts receivable,
less allowance of $3,436 and $3,603 21,958 27,233
Deferred income taxes 3,112 3,408
Prepaid expenses and other current assets 3,236 3,086
Total current assets 35,320 37,410
Installment accounts receivable, long-term 2,686 3,810
Property and equipment, net 3,640 3,544
Computer software, net 22,520 23,359
Goodwill 5,303 1,286
Other assets 499 1,221
Total assets $69,968 $70,630
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable 2,103 2,099
Current portion of long-term debt 74 157
Accrued expenses 4,984 6,279
Accrued compensation 4,803 4,699
Current deferred revenues 18,569 17,484
Total current liabilities 30,533 30,718
Long-term debt, net of current portion 223 389
Deferred revenues, long-term 2,542 3,653
Deferred income taxes, net 2,769 3,029
Minority interest in net earnings of
consolidated subsidiary - - - 5,683
Total liabilities 36,067 43,472
Commitments and contingent liabilities
Stockholders' equity:
6% cumulative convertible preferred
stock, $0.25 par value; 48 and 148
shares issued and outstanding 916 2,846
Common stock, $0.50 par value;
10,000 shares authorized; 4,040 and
3,594 issued and outstanding 2,020 1,797
Capital contributed in excess of par value 24,993 17,763
Retained earnings 7,710 6,480
Accumulated other comprehensive income 277 287
35,916 29,173
Less treasury stock at cost, 317 shares (2,015) (2,015)
Total stockholders' equity 33,901 27,158
Total liabilities and stockholders' equity $69,968 $70,630
SOURCE Group 1 Software
-0- 02/12/99
/CONTACT: Mark Funston, Chief Financial Officer of Group 1, 301-918-0400;
Investor Contact: Joseph Zappulla, ext. 223 or Doug Poretz, ext. 222, of The
Poretz Group, 703-506-1778, for Group 1/
/Web site: g1.com
Companies or Securities discussed in this article:
Symbol Name
NASDAQ:GSOF
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