4Front Software International, Inc. announces fiscal 1997 first quarter results.LONDON--(BUSINESS WIRE)--June 11, 1997--4Front Software International, Inc. ("4Front") (Nasdaq NM: FFST FFST First Failure Support TechnologyFFST Fat Free Soft Tissue FFST Full and Flat Square Tube (Cathode Ray Tube design) ) today announced results for the first quarter ended April 30, 1997.
Highlights(a)
First Quarter ended April 30,
1997 1996 %Increase
Revenues $ 18,624,000 $ 10,550,000 77%
Net income $ 631,000 $ 198,000 219%
Net income per
share (basic) $ 0.10 $ 0.07 43%
Net income per
share (diluted) $ 0.09 $ 0.05 80%
Fully diluted
shares
outstanding 6,695,698 3,697,573
(a) A substantial part of the company's growth in the past three
years has been achieved through acquisition. Accordingly, the
results of operations from period to period are not necessarily
comparable.
For the first quarter ended April 30, 1997, revenues increased 77%
to $18,624,000, versus $10,550,000 reported for the comparable
year-ago period. Net income for the most recent quarter was
$631,000, or $0.09 per share fully diluted (based on 6,695,698
shares), versus $198,000, or $0.05 per share fully diluted (based on
3,697,573 shares), for the comparable year-ago period. The
significant increase in shares outstanding reflects the impact of the
company's secondary offering of Common Stock that was completed
during the second quarter of 1996 and the assumed conversion of
applicable stock options and warrants for the first quarter ended
April 30, 1997.
Anil Doshi, Chairman and Chief Executive Officer of 4Front, said,
"Overall, we are pleased with our performance for the quarter,
especially with that of our services business, where most activities
continue to surpass our expectations. Reflecting the increased
service contribution, margins continued to improve. As we have
stated, margin improvement, and profitability, is now our main focus.
"A year ago, 4Front was not even ranked among the UK's top 25
largest third party computer maintenance companies. It is a sign of
the pace of growth in 4Front's services business that it is now
ranked as the 13th largest such company. During the quarter the new
4Front National Call Center became operational. All of our hardware
and software support activities are coordinated from this new central
facility, which is currently handling an average of 1,000 support
calls a day. The move to this facility provides 4Front with a
stronger foundation from which to handle the increasing level of
business being contracted.
"During the quarter, 4Front's help-desk business made significant
progress in attracting customers on both the retail and the corporate
fronts. On the retail side, a new large supply contract with Byte
Ltd. was signed and, after the quarter-end, 4Front signed an
agreement to provide the John Lewis Group, a major retailer, with an
estimated $500,000 worth of software support contracts. On the
corporate side, the company is increasing its participation in major
corporate help-desk bids, following its recent contract successes."
Mr. Doshi concluded, "In general, our services business is gaining
an increasing number of higher value contracts, which reflects both
our excellent record of service and the benefit of `critical mass'
that 4Front has worked hard to achieve over the past few years."
Mark Ellis, President of 4Front, added, "Orders in our storage
business were in line with targets. However, overall first quarter
business was affected by worldwide product shortages, particularly in
the high-end disc drive market. Elsewhere on the product side,
indications are that the network computer technology is being well
received on both sides of the Atlantic and looks to be a fast growing
market. Our sales of network computers are picking-up steadily and
we have a number of promising large-scale opportunities where pilot
systems are being evaluated."
Mr. Ellis concluded, "Lastly, the UK economy remains strong and
conditions in the computer service markets in which 4Front operates
continue to be good."
4Front Software International, Inc., a UK-based specialized computer
services company provides a wide range of specialized high-end
information technology solutions and services principally to
Financial Times UK Top 500 companies and government authorities. The
company provides key elements of distributed computing, including
systems development and integration, storage and client-server
solutions and products, as well as extensive hardware and software
support services. The company's customers include Mobil Oil, Royal
Dutch/Shell Group, GEC/Marconi, JP Morgan, Fujitsu, Dupont, Reuters
and the U.K. Ministry of Defense.
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4FRONT SOFTWARE INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
For the Three Months Ended
April 30, April 30,
1997 1996
(unaudited) (unaudited)
REVENUES:
Products $ 10,427,687 $ 7,328,339
Services 8,196,598 3,221,899
18,624,285 10,550,238
Cost of Products 8,880,689 6,002,795
Cost of Services 4,148,921 1,276,346
13,029,610 7,279,141
GROSS PROFIT
Products 1,546,998 1,325,544
Services 4,047,677 1,945,553
5,594,675 3,271,097
OPERATING EXPENSES:
Selling, general and
administrative 4,354,626 2,712,078
Depreciation 195,166 80,959
Amortization 210,481 61,870
Total operating
expenses 4,760,273 2,854,907
INCOME BEFORE INTEREST, INCOME
TAXES AND SHARE OF RESULTS
IN EQUITY INVESTEE: 834,402 416,190
Interest income 77,644 3,841
Interest expense (71,145) (103,614)
INCOME BEFORE INCOME TAXES AND
SHARE OF RESULTS IN EQUITY
INVESTEE: 840,901 316,417
SHARE OF OPERATING (LOSS) OF
EQUITY INVESTEE --- (52,173)
INCOME BEFORE INCOME TAXES 840,901 264,244
INCOME TAXES 210,225 66,061
NET INCOME $ 630,676 $ 198,183
NET INCOME PER
COMMON SHARE (Basic) $ 0.10 $ 0.07
NET INCOME PER COMMON
SHARE (Fully Diluted) $ 0.09 $ 0.05
WEIGHTED AVERAGE SHARES
OUTSTANDING 6,514,747 3,011,068
FULLY DILUTED SHARES
OUTSTANDING 6,695,698 3,697,573
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4FRONT SELECT BALANCE SHEET INFORMATION
April 30, 1997 January 31, 1997
(unaudited) (audited)
Current assets $ 29,747,000 $ 30,349,000
Current liabilities 23,417,000 24,764,000
Total assets 41,216,000 42,021,000
Long-term debt 421,000 489,000
Shareholders' equity $ 17,378,000 $ 16,769,000
CONTACT: Investor Relations Investor relations The process by which the corporation communicates with its investors. : Jason Thompson Jason Thompson can refer to different people:
212/838-3777 or Company Contact: 4Front Software International, Inc. Mark Ellis Mark Ellis is the name of:
011/44-1923-294555 |
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