Press Release
- Date:
- Thursday, August 03, 2000
- Contact:
- David Peikin
- Phone:
- (301) 918-0818
- Email:
- G1@schwartz-pr.com
Group 1 Software Reports Record First Quarter Results
EPS More Than Doubles to $0.16Revenues up 20% to $20.1 million
Lanham, MD — Group 1 Software (Nasdaq: GSOF) today reported results for its first fiscal quarter ended June 30, 2000. The Company reported revenues of $20.1 million, up 20% over the prior year's first quarter revenues of $16.8 million. Net income available to common stockholders nearly tripled to $1.1 million from $0.4 million the prior year. Diluted earnings per share increased 167% to $0.16 per share from $0.06 per share the prior year. (The increased price of Group 1 stock resulted in a 22% increase in diluted weighted average shares outstanding which reduced the growth in earnings per share.)
Operating income nearly tripled to $1.1 million from $0.4 million in the prior year while non-operating income increased to $0.8 million from $0.2 million the prior year. Non-operating income in the current quarter was positively impacted by a net $250,000 currency gain. Excluding this gain, non-operating income still rose by 150% to $521,000. Group 1's cash flow also continued strong. Cash and short-term investments totaled $32.3 million (approximately $4.68 per diluted share) at June 30, 2000 compared with $32.0 million at March 31, 2000 and $14.8 million at March 31, 1999.
"I am highly pleased with our bottom line growth improvement, especially as we continue to invest in our e-commerce initiatives," said Group 1 CEO Bob Bowen. "We made substantial progress on these initiatives during the quarter, including:
Release of significant enhancements to our DOC1 product to facilitate applications in the rapidly growing Electronic Bill Presentation and Payment arena. Release of our DataVerse product suite, a Web-enabled group of products which enables e-businesses easily to integrate Group 1's state-of-the-art address verification technologies into their Internet applications. Signing of a number of leading e-businesses as beta customers of DataQuality.net, our new web service which provides customer data quality and data enrichment solutions for e-commerce and enterprise-wide applications. We anticipate a September launch of DataQuality.net," Bowen concluded.
Group 1 Software is a leading provider of software for data quality, database marketing, electronic document composition applications, and mailing efficiency and direct marketing applications. Group 1 supports MVS, VSE, AS/400, UNIX (including Linux), Windows NT, Windows 2000 and other operating systems and various computers. Group 1 has offices throughout the United States and in Canada, the United Kingdom, and continental Europe; the Miami office serves the Latin American market. The company is also represented in Asia and Australia.
GROUP 1 SOFTWARE, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data)
For the Three Month Period Ended June 30, 2000 1999 Revenues: Software license and related revenues $ 7,637 $ 6,885 Maintenance and services 12,425 9,872
Total revenue 20,062 16,757
Cost of revenue: Software license expense 3,060 3,199 Maintenance and service expense 4,212 3,709 Total cost of revenue 7,272 6,908
Gross profit 12,790 9,849
Operating expenses: Research and development 1,511 802 Sales and marketing 6,512 5,863 General and administrative 3,642 2,774 Total operating expenses 11,665 9,439 Income from operations 1,125 410
Non-operating income 771 208
Income from operations before provision for income taxes 1,896 618
Provision for income taxes 765 239 Net income 1,131 379
Preferred stock dividend requirements (14) (14)
Net income available to common stockholders $ 1,117 $365
Basic earnings per share $ 0.19 $ 0.06
Diluted earnings per share $ 0.16 $ 0.06
Basic weighted average shares outstanding 5,980 5,588
Diluted weighted average shares outstanding 6,898 5,670
GROUP 1 SOFTWARE, INC. CONSOLIDATED BALANCE SHEETS (in thousands, except per share data)
June 30, March 31, 2000 2000 ASSETS Current assets: Cash and cash equivalents $22,937 $20,735 Short-term investments 9,343 11,259 Trade and installment accounts receivable, less allowance of $3,276 and $3,317 16,730 21,561 Deferred income taxes 3,469 3,297 Prepaid expenses and other current assets 3,528 3,407 Total current assets 56,007 60,259
Installment accounts receivable, long-term 1,652 1,945 Property and equipment, net 4,633 4,290 Computer software, net 20,867 21,823 Other assets 4,548 4,750 Total assets $87,707 $93,067
LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable 2,025 1,940 Current portion of capital lease obligation 112 109 Accrued expenses 6,385 6,627 Accrued compensation 5,383 7,617 Current deferred revenues 23,863 26,865 Total current liabilities 37,768 43,158
Capital lease obligation, net of current portion 59 88 Deferred revenues, long-term 917 1,169 Deferred income taxes 3,324 3,724 Total liabilities 42,068 48,139
Commitments and contingencies
Stockholders' equity: 6% cumulative convertible preferred stock, $0.25 par value; 200 shares authorized; 48 shares issued and outstanding 916 916 Common stock, $0.50 par value; 14,000 shares authorized; 6,497 and 6,468 issued and outstanding 3,248 3,234 Additional paid in capital 27,611 27,431 Retained earnings 16,801 15,684 Accumulated other comprehensive income (602) (2) Less treasury stock at cost, 497 shares (2,335) (2,335) Total stockholders' equity 45,639 44,928 Total liabilities and stockholders' equity $87,707 $93,067