News, both bad and encouraging ("value enhancing alternatives"). I do not own this one but tomorrow's open should be interesting.
biz.yahoo.com
Wednesday March 24, 4:05 pm Eastern Time
Company Press Release
Aztec Technology Partners Announces Lower Than Expected First Quarter
and Calendar Year Earnings
Board Committee Formed to Explore Shareholder Value Enhancing
Alternatives
BOSTON--(BUSINESS WIRE)--March 24, 1999-- Aztec Technology Partners,
Inc., (NASDAQ:AZTC - news), a leading single-source provider of
information technology business solutions and internet development and
utilization consulting, today announced that based on management's
current assessment, the Company will report lower than expected earnings
for both the first quarter ending March 31, 1999, and for the fiscal
year ending December 31, 1999.
The Company anticipates that earnings per share for the first quarter
will be in the range of $.01 to $.03 per share compared with analysts'
estimates of $0.12 per share, and that earnings for calendar 1999 are
currently expected to be in the range of $0.20 to $0.30 per share
compared with estimates of $.55 to $.58 per share. The Company expects
that total revenues for the first quarter of 1999 will be $80 million to
$85 million compared with analysts' expectations of $89 million to $93
million, and for calendar 1999 will be $375 million to $385 million
compared with analysts' expectations of $384 million to $399 million.
EBITDA for calendar 1999 is expected to be between $23 million and $25
million.
Jim Claypoole, Aztec's chairman and chief executive officer stated:
''The reduction in expected earnings reported today is caused primarily
by three factors: the effects of continued competitive pressure on
product margins not offset by higher service growth; a slowdown in the
cabling portion of our voice and data business unit in Southern
California; and higher overhead at one of our branches that increased
staff in anticipation of fulfilling service revenues that did not
materialize.''
Mr. Claypoole added: ''Since our spin-off in June 1998, we have been
transitioning to a stronger IT service model by expanding our pure
services business - particularly web and internet applications
development - and increasing the amount of IT services revenue in
branches that have been dependent on the sale of computer products. The
disappointment with these operating results highlights the need to
further accelerate our move toward a stronger contribution from IT
services. Ultimately, faster migration away from product dependency in
some branches of the Company will help offset the adverse effects in our
performance that we are currently experiencing.''
Doug Johnson, Aztec's executive vice president and chief financial
officer, noted that the Company had a strong cash position at year-end
of $8.8 million, and that the Company expects to remain cash flow
positive, and remain in compliance with the financial covenants in its
bank line.
The Company also announced that the NASDAQ has agreed to exempt the
Company from the $5.00 per share minimum bid price requirement for
NASDAQ listing purposes until May 17, 1999. If the bid price of the
Company's shares does not satisfy the minimum requirement by that date,
the Company could then apply before a NASDAQ hearing panel for a further
extension or a permanent exemption. If the panel concludes that the
Company's shares should be de-listed from the NASDAQ National Market,
the Company will seek an alternative listing on the NASDAQ Small
Capitalization Market.
The Company also announced that the Board of Directors has established a
Strategic Committee to explore and evaluate financial and strategic
alternatives for increasing shareholder value including ways of
repositioning the Company in higher margin business and other
alternatives such as strategic alliances, recapitalization, taking the
company private, or merger.
''Implementation plans are well underway to correct each of the problems
that contributed to its reduction in expected earnings,'' explained Mr.
Claypoole. ''Based on the growth of its services revenue and the
continued demand for engagements that require multiple IT solutions, we
remain optimistic that Aztec will realize our goal of becoming a
dominant force as a single-source IT provider in the web and internet
services industry.''
About Aztec Technology Partners
Aztec Technology Partners, Inc. is a ''one-stop'' information technology
solutions provider for middle market and Fortune 1000 companies from a
broad range of industries. Aztec provides superior client service and
value-added solutions to customers throughout the U.S. For more
information, please visit the Company's web site at www.aztectech.com.
This press release contains ''forward-looking statements.''
Forward-looking statements give our current expectations or forecasts of
future events. You can identify these statements by the fact that they
do not relate strictly to historical or current facts. They use words
such as ''anticipate,'' estimate,'' ''expect,'' ''project,'' ''intend,''
''plan,'' ''believe,'' and other words and terms of similar meaning in
connection with any discussion of future operating or financial
performance. In particular, these include statements relating to our
anticipated operating results for the quarter ended March 31, 1999, and
the full year ended December 31, 1999, and our anticipated cash flow,
and to future actions, future performance, or results of current and
anticipated sales and marketing efforts, expenses, the outcome of
contingencies such as legal proceedings and other financial results.
Any of these forward-looking statements may turn out to be wrong. They
can be affected by inaccurate assumptions we might make or by known or
unknown risks and uncertainties. These risks include the absence of the
Company's history as a stand-alone company, the risks relating to
acquisitions, our dependence on acquisitions for future growth, the
variability of our quarterly operating results, the inherent
difficulties in projecting financial results in the services industry,
and other risks identified by us from time to time in our 1O-Q, 8-K and
1O-K reports filed with the Securities and Exchange Commission. We urge
you to read these reports in evaluating the forward-looking statements
in this press release. Other factors besides those listed could also
adversely affect the Company. Finally, we call your attention to the
fact that we undertake no obligation to publicly update any
forward-looking statement, whether as a result of new information,
future events or otherwise.
------------------------------------------------------------------------
Contact:
Aztec Technology Partners, Inc., Boston
Doug Johnson, (781) 849-1702
dougj@aztectech.com |
