A D S Financial Services Solutions Announces Fourth Quarter and Fiscal Year 2002 Results.Business Editors QUINCY, Mass.--(BUSINESS WIRE)--May 2, 2002 A D S Financial Services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. Solutions(TM) (ADS) (Nasdaq: ADSC ADSC Adobe Document Structuring Conventions ADSC Active Duty Service Commitment ADSC Address Status Changed ADSC Army Development and Selection Centre (UK MoD) ADSC Automatic Data Service Center ), today announced revenues and net income (loss) for the fourth quarter and fiscal year ended March 31, 2002. For the quarter ended March 31, 2002, ADS posted revenues of $5.8 million, down 2.3% from revenues of $5.9 million for the same period in fiscal 2001. Income from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the for the three months ended March 31, 2002 was $2.2 million or $0.17 per share (diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. ) on 13,201,000 shares. Included in income from continuing operations was a tax benefit of $1.7 million ($0.13 per share) resulting from the recent passage of the Economic Stimulus stimulus /stim·u·lus/ (stim´u-lus) pl. stim´uli [L.] any agent, act, or influence which produces functional or trophic reaction in a receptor or an irritable tissue. Act which allows a company to carry-back The name given to the method provided under federal tax law that allows a taxpayer to apply net operating losses incurred during one year to the recomputation of Income Tax owed to the government for three preceding taxable years. losses for five years to recover taxes previously paid. Because the Economic Stimulus Act was passed in the fourth quarter, the benefit to be realized for the entire year was recognized in the fourth quarter. Net income for the quarter ended March 31, 2002 was $410,000, or $0.03 per share (diluted) on 13,201,000 shares compared to a net loss of $(1.0) million, or $(0.08) per share on 13,010,000 shares in fiscal 2001. On March 29, 2002, the Company announced its decision to discontinue dis·con·tin·ue v. dis·con·tin·ued, dis·con·tin·u·ing, dis·con·tin·ues v.tr. 1. To stop doing or providing (something); end or abandon: the operations of EarningsInsights ("EI"). Consequently, the Company incurred a charge of $1.9 million or $(0.15) per share, net of income tax benefits, related to the write-off Write-Off A reduction in the value of an asset or earnings by the amount of an expense or loss. Companies are able to write off certain expenses that are required to run the business, or have been incurred in the operation of the business and detract from retained revenues. of the EI assets and an accrual accrual, n continually recurring short-term liabilities. Examples are accrued wages, taxes, and interest. for estimated losses during the phase-out period. Results of operations of EI have been classified as discontinued dis·con·tin·ue v. dis·con·tin·ued, dis·con·tin·u·ing, dis·con·tin·ues v.tr. 1. To stop doing or providing (something); end or abandon: and for the fourth quarter represented income of $92,000, or $0.01 per share, net of tax benefits. Revenues for the fiscal year ended March 31, 2002 were $20.4 million, a 40.2% decrease compared to revenues of $34.1 million for fiscal year 2001. Loss from continuing operations for the year was $(3.4) million or $(0.26) per share on 13,028,000 shares. Included in the loss from continuing operations for the year was a tax benefit of $1.3 million ($0.10 per share) resulting from the aforementioned a·fore·men·tioned adj. Mentioned previously. n. The one or ones mentioned previously. aforementioned Adjective mentioned before Adj. 1. passage of the Economic Stimulus Act allowing the carry-back of losses to recover taxes previously paid. This tax benefit is net of a provision for taxes in fiscal Q1 of $.4 million, or $0.03 per share, to establish a valuation allowance for deferred taxes that may not be realizable in the near future. Net income (loss) for the year was $(6.1) million or $(0.47) per share on 13,028,000 shares compared to $26,000 or $0.0 per share (diluted) on 13,213,000 shares for fiscal 2001. Included in the net loss for the year ended March 31, 2002 are charges aggregating $3.9 million relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the following: a $.9 million restructuring charge restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. and an investment write-down Write-Down Reducing the book value of an asset because it is overvalued compared to the market value. Notes: This is usually reflected in the company's income statement as an expense, thereby reducing net income. of $3.0 million. In addition, the aggregate charges net of tax benefits relating to the discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. of EI were $2.7 million or $(0.21) per share. "While fiscal 2002 was very challenging and our revenue was 40.2% less than the prior fiscal year, we did improve our gross profit margin Gross profit margin Gross profit divided by sales, which is equal to each sales dollar left over after paying for the cost of goods sold. gross profit margin A measure calculated by dividing gross profit by net sales. 3.7 percentage points from 30.0% of revenue to 33.7%, primarily due to increases in our average billing rates. Further, we decreased general and administrative and sales and marketing expenses by 26.4% or $3.1 million," said Robert W. Howe, Chairman and Chief Executive Officer. First Quarter FY2003 Outlook. With respect to ADS' earnings projections for the future, Howe continued, "We anticipate that first quarter revenue for fiscal 2003 will be in the $6.0 to $6.4 million range with net income of $0.00 to $0.02 per share. Net income for fiscal Q1 2003 will be net of a provision for tax whereas fiscal Q4 2002 net income was net of a tax credit." "Despite the continued economic uncertainty, we remain financially strong and are committed to returning to revenue growth and profitability. At March 31, 2002, we had cash and short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. investments of $32.0 million, a refund TO REFUND. To pay back by the party who has received it, to the party who has paid it, money which ought not to have been paid. 2. On a deficiency of assets, executors and administrators cum testamento annexo, are entitled to have refunded to them legacies due from the U.S. government of $2.8 million, days sales outstanding In accountancy, Days Sales Outstanding is a company's average collection period. A low figure indicates that the company collects its outstanding receivables quickly. Typically it is looked at either quarterly or yearly (90 or 365 days). of 49, no debt, and a current ratio of 12.5 to 1.0," Howe concluded. About A D S Financial Services Solutions A D S Financial Services Solutions is a trademark of Atlantic Data Services, Inc., a Quincy, Mass.- based IT strategy consulting and systems integration firm exclusively serving the needs of the financial services industry. ADS offers rapid, cost effective IT solutions to the business challenges faced by financial services companies through its in-depth financial services experience, technological expertise and project management skills. The Company's service offerings are organized around four areas: Customer Relationship Management (CRM (Customer Relationship Management) An integrated information system that is used to plan, schedule and control the presales and postsales activities in an organization. ), Conversions and Consolidations, IT Strategy and Consulting, and e-Business. For additional information about ADS please visit our website at www.adsfs.com. This press release includes forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. , which are made pursuant to the safe-harbor provisions of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. You can identify these forward-looking statements when you see us using words such as "expect," "anticipate," "believe," "intend," "may," "predict," and other similar expressions. These forward-looking statements cover, among other items: events, conditions and financial trends that may affect the Company's future plans of operation, business strategy, growth of operations and financial position, including statements regarding revenue and earnings or loss per share projections. Any forward-looking statements are not guarantees of future performance and are necessarily subject to a number of risks and uncertainties, some of which are beyond our control. Because of these risks and uncertainties, the forward-looking events discussed in this release might not transpire.
Atlantic Data Services, Inc.
Consolidated Statements of Operations
(in thousands, except per share data)
Three Months Ended Year Ended
March 31, March 31,
2002 2001 2002 2001
(unaudited) (unaudited)
Revenues $5,781 $5,918 $20,419 $34,135
Cost of Revenues 3,265 4,810 13,537 23,890
Gross Profit 2,516 1,108 6,882 10,245
Operating Expenses:
Sales and Marketing 744 1,239 3,284 4,856
General and Administrative 1,356 1,691 5,382 6,920
Restructuring Expense -- 337 925 337
Total Operating Expenses 2,100 3,267 9,591 12,113
Income (Loss) from Operations 416 (2,159) (2,709) (1,868)
Interest Income, Net 172 492 1,041 2,144
Write-Down of Investment -- -- 3,000 --
Income (Loss) from Continuing
Operations before Provision
for Income Taxes 588 (1,667) (4,668) 276
Provision (Benefit) for
Income Taxes (1,660) (670) (1,274) 250
Income (Loss) from
Continuing Operations 2,248 (997) (3,394) 26
Discontinued Operations:
Loss (Income) from Operations
of Discontinued Business
(Less Applicable Income Tax
Benefit of $410) (92) -- 797 --
Loss on Disposal of Business
(Less Applicable Income Tax
Benefit of $735) 1,930 -- 1,930 --
Net Income (Loss) $410 $(997) $(6,121) $26
Earnings (Loss) per Share from
Continuing Operations:
Basic $0.17 $(0.08) $(0.26) $ --
Diluted $0.17 $(0.08) $(0.26) $ --
Loss from Discontinued
Operations:
Basic $0.14 $ -- $(0.21) $ --
Diluted $0.14 $ -- $(0.21) $ --
Earnings (Loss) per Share
from Net Income:
Basic $0.03 $(0.08) $(0.47) $ --
Diluted $0.03 $(0.08) $(0.47) $ --
Shares Used in Computing
Earnings per Share (Basic) 13,033 13,010 13,028 12,998
Shares Used in Computing
Earnings per Share (Diluted) 13,201 13,010 13,028 13,213
Atlantic Data Services, Inc.
Condensed Consolidated Balance Sheets
(in thousands)
March 31, March 31,
2002 2001
(unaudited)
Cash and Cash Equivalents $15,457 $36,655
Short-Term Investments 16,601 --
Accounts Receivable, Net 3,170 3,090
Due from Government 2,784 --
Prepaid Expenses 260 243
Deferred Taxes -- 464
Total Current Assets 38,272 40,452
Long-Term Investment -- 3,000
Property and Equipment, Net 308 629
Other Assets 182 536
Total Assets $38,762 $44,617
Current Liabilities $ 3,053 $ 3,452
Total Stockholders' Equity 35,709 41,165
Total Liabilities and Stockholders' Equity $38,762 $44,617
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