Ambassadors Group Announces Earnings Increase for Second Quarter.SPOKANE Spokane, city, United States Spokane (spōkăn`), city (1990 pop. 177,196), seat of Spokane co., E Wash., at the spectacular falls of the Spokane River; inc. 1881. , Wash. -- Ambassadors Group The Ambassadors Group was originally an operating division of Ambassadors International, Inc., but was divested into a separate corporation in 2002 to form the company under its current name. , Inc. (Nasdaq:EPAX EPAX Electronic Private Automatic Exchange ), a leading provider of educational travel experiences, announced an increase in fully 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. second quarter earnings ended June June: see month. 30, 2004, of 40 percent. Earnings per share for the second quarter of 2004 were $1.26 per share compared to $0.90 in the second quarter of 2003. For the six months ended June 30, 2004, fully diluted earnings increased 42 percent, from $0.73 per share in 2003 to $1.04 in 2004. Quarter Ended June 30, 2004 Gross program receipts increased 36 percent in the second quarter of 2004, from $53.7 million in 2003 to $72.8 million in 2004. Net revenue increased 42 percent in the second quarter of 2004, an increase from $18.2 million in 2003 to $25.9 million in 2004. The overall increase of gross program receipts and net revenue resulted from an increased number of delegates traveling during 2004. The Company's gross margin was 36 percent for the quarter ended June 30, 2004, compared to 34 percent for the same period of 2003. This increase was a direct result of cost management and program quality enhancements. Operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. were $6.3 million in the second quarter of 2004, from $4.8 million in the comparable quarter of 2003. The increase of $1.5 million for the second quarter ended June 30, 2004, is primarily due to higher selling and tour promotion costs. These higher costs are the result of planned increases in marketing expenses associated with new and existing programs and additional personnel to support the increased number of delegates traveling in 2004. The Company's cash, cash equivalents and available-for-sale securities balances at June 30, 2004, and June 30, 2003, were $98.9 million and $69.1 million, respectively. The Company's deployable cash at June 30, 2004, and June 30, 2003, was $40.1 million and $30.8 million, respectively (see definition on final page of the press release). Six Months Ended June 30, 2004 For the six months ended June 30, 2004, gross program receipts increased 36 percent, from $56.3 million in 2003 to $76.9 million in 2004. For the six months ended June 30, 2004, net revenue increased 41 percent, from $19.2 million in 2003 to $27.1 million in 2004. The increase in gross program receipts and net revenue resulted from a greater number of delegates traveling in the first six months of 2004 compared to the first six months of 2003. The Company's gross margin was 35 percent for the six months ended June 30, 2004, compared to 34 percent for the same period of 2003. This increase was a direct result of cost management and program quality enhancements. Operating expenses for the six months ended June 30, 2004 were $11.1 million compared to $8.6 million in 2003. The increase of $2.5 million was due primarily to higher selling and tour promotion costs. These higher costs are the result of planned increases in marketing expenses associated with new and existing programs and additional personnel to support the increased number of delegates traveling in 2004. The Company's cash, cash equivalents and available-for-sale securities balances at June 30, 2004, and December December: see month. 31, 2003, were reported at $98.9 million and $67.5 million, of which $40.1 million and $32.9 million represented deployable cash (see definition on final page of the press release). Jeff Thomas (language) Thomas - A language compatible with the language Dylan(TM). Thomas is NOT Dylan(TM). The first public release of a translator to Scheme by Matt Birkholz, Jim Miller, and Ron Weiss, written at Digital Equipment Corporation's Cambridge Research Laboratory runs , president and chief executive officer of Ambassadors Group, Inc. stated, "We are more than pleased with our financial results in 2004 so far. Due to our seasonality, the changes and improvements that we have been making to our operations, brand strength and financial management have not been fully visible outside of our organization. Our 46 percent quarter over quarter increase in net income reflects these changes. "While making these improvements over the last two years, we have been forward looking and positioning ourselves to capitalize on Cap´i`tal`ize on` v. t. 1. To turn (an opportunity) to one's advantage; to take advantage of (a situation); to profit from; as, to capitalize on an opponent's mistakes s>. positive changes in the geopolitical ge·o·pol·i·tics n. (used with a sing. verb) 1. The study of the relationship among politics and geography, demography, and economics, especially with respect to the foreign policy of a nation. 2. a. and economic environment. Although some troubling global issues remain, there are developments in the world that have enabled us to safely travel over 16,000 delegates in the first half of 2004, compared to 12,000 delegates one year ago. "We have also made progress with capital deployment Installing, setting up, testing and running. This military term, which means the placement of troops and equipment in the field, is widely used with computers as an alternate to the word "implementation. . We have initiated purchases of our own stock through the share repurchase Share Repurchase A program by which a company buys back its own shares from the marketplace, reducing the number of outstanding shares. This is usually an indication that the company's management thinks the shares are undervalued. program that was announced in May 2004. We have also issued $2.2 million in dividends year to date. "Throughout the last couple of years, we have enjoyed strong shareowner share·own·er n. See shareholder. Noun 1. shareowner - someone who holds shares of stock in a corporation shareholder, stockholder investor - someone who commits capital in order to gain financial returns support and believe that support has been very helpful in allowing us to focus building shareowner value for the longer term. We look forward to continuing to grow with you." Ambassadors Group, Inc. will host a conference call to discuss results of operations and the outlook for 2004, Tuesday Tuesday: see week. , July July: see month. 20 at 8:30 a.m. Pacific Time. Interested parties may join the call by dialing 800-884-5695, then entering the pass code: 54134039. The conference call may also be joined via the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the at www.AmbassadorsGroup.com/EPAX. For replay access, parties may dial 888-286-8010 with the pass code of 90322944 and follow the prompts, or visit the www.AmbassadorsGroup.com/EPAX web site. Replay access will be available beginning July 20 at 10:30 a.m. through July 27. Post-view web cast access will be available following the conference call through September September: see month. 20, 2004. Ambassadors Group, Inc. is a leading educational travel company that organizes and promotes international and domestic programs for students, athletes, and professionals. These programs provide opportunities for grade school, junior, and senior high school students to visit foreign and domestic destinations to learn about the history, government, economy and culture of such areas, as well as for junior and senior high school athletes to participate in international sports challenges Sports Challenge was a sports-centered game show that aired in weekly syndication from 1971 to 1979, with a separate version airing briefly on CBS in 1973. Dick Enberg was host. Johnny Gilbert, Art James, and John Harlan announced. . The Company's professional programs emphasize meetings and seminars between participants and persons in similar professions abroad. 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. This press release contains forward-looking statements regarding the Company's actual and expected financial performance and the reasons for variances between quarter-to-quarter results. Forward-looking statements, which are included per the "safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. " 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, may involve known and unknown risks, uncertainties and other factors that may cause the Company's actual results and performance in future periods to be materially different from any future results or performance suggested by the forward-looking statements in this release. Such forward-looking statements speak only as of the date of this release and may not reflect risks related to the conflict in the Middle East and international unrest Unrest is a sociological phenomenon, for instance:
see epidemic. of disease, conditions in the travel industry, direct marketing environment, changes in economic conditions and changes in the competitive environment. The Company expressly disclaims any obligation to provide public updates or revisions ReVisions is a 2004 anthology of alternate history short-stories. It is edited by Julie E. Czerneda and Isaac Szpindel. Contents Title Author The Resonance of Light James Alan Gardner Out of China Julie E. to any forward-looking statements found herein to reflect any changes in Company expectations or any change in events. Although the Company believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that its expectations will be attained at·tain v. at·tained, at·tain·ing, at·tains v.tr. 1. To gain as an objective; achieve: attain a diploma by hard work. 2. . For a more complete discussion of these and other factors, please refer to Ambassadors Group, Inc. 10K filed March 12, 2004, 10Q filed May 10, 2004 and proxy See proxy server. (networking) proxy - A process that accepts requests for some service and passes them on to the real server. A proxy may run on dedicated hardware or may be purely software. filed April 14, 2004.
The following summarizes the Company's financial information for
the quarters ended June 30, 2004 and 2003 (in thousands, except per
share amounts):
UNAUDITED
-----------------
Quarter ended
June 30
-----------------
2004 2003
-----------------
Gross program receipts $72,760 $53,749
Net revenue 25,854 18,184
Operating expenses:
Selling and tour promotion 4,897 3,572
General and administration 1,382 1,214
------- -------
Total operating expenses 6,279 4,786
Operating income 19,575 13,398
Other income, net 302 267
------- -------
Income before tax 19,877 13,665
Income tax provision 6,758 4,646
------- -------
Net income $13,119 $ 9,019
======= =======
Earnings per share - basic $ 1.31 $ 0.91
======= =======
Weighted average shares outstanding -
basic 10,049 9,897
Earnings per share - diluted $ 1.26 $ 0.90
======= =======
Weighted average shares outstanding -
diluted 10,423 10,069
The following summarizes the Company's financial information for
the six months ended June 30, 2004 and 2003 (in thousands, except per
share amounts):
UNAUDITED
-----------------
Six months ended
June 30
-----------------
2004 2003
------- -------
Gross program receipts $76,859 $56,349
Net revenue 27,114 19,221
Operating expenses:
Selling and tour promotion 8,593 6,477
General and administration 2,544 2,168
------- -------
Total operating expenses 11,137 8,645
Operating income 15,977 10,576
Other income, net 505 489
------- -------
Income before tax 16,482 11,065
Income tax provision 5,604 3,762
------- -------
Net income $10,878 $ 7,303
======= =======
Earnings per share - basic $ 1.08 $ 0.74
======= =======
Weighted average shares outstanding - basic 10,033 9,889
Earnings per share - diluted $ 1.04 $ 0 .73
======= =======
Weighted average shares outstanding - diluted 10,415 10,046
The Company has a single operating segment consisting of the
educational travel and sports programs for students, athletes and
professionals. These programs have similar economic characteristics
and offer comparable products to participants, as well as utilize
similar processes for the program marketing.
The following summarizes the Company's balance sheets as of June
30, 2004, June 30, 2003 and December 31, 2003 (in thousands):
UNAUDITED AUDITED
---------------- -----------
June 30 December 31
2004 2003 2003
------- ------- -----------
Assets
------
Cash and cash equivalents $ 37,705 $ 40,341 $ 33,653
Available-for-sale securities 61,168 28,742 33,872
Foreign currency exchange contracts 499 1,928 5,209
Prepaid program costs and expenses 27,677 24,362 1,608
Other current assets 539 104 233
------- ------- -----------
Total current assets 127,588 95,477 74,575
Property and equipment, net 3,742 1,688 2,966
Deferred tax asset 1,614 1,663 1,664
Other assets 115 70 116
------- ------- -----------
Total assets $133,059 $ 98,898 $ 79,321
======= ======= ===========
Liabilities and Stockholders' Equity
------------------------------------
Accounts payable and accruals $ 20,147 $ 15,045 $ 4,435
Participants' deposits 62,404 47,608 28,220
Deferred tax liability 45 598 1,690
Other current liabilities 3,947 - 3,575
------- ------- -----------
Total current liabilities 86,543 63,251 37,920
Capital lease, long term 526 - 592
------- ------- -----------
Total liabilities 87,069 63,251 38,512
Stockholders' equity 45,990 35,647 40,809
------- ------- -----------
Total liabilities and stockholders'
equity $133,059 $ 98,898 $ 79,321
======= ======= ===========
Deployable cash is a non-GAAP liquidity measure. The following
summarizes the Company's deployable cash as of June 30, 2004, June 30,
2003 and December 31, 2003 (in thousands):
UNAUDITED AUDITED
------------------ ------------
June 30 December 31
2004 2003 2003
-------- -------- ------------
Cash, cash equivalents and $ 98,873 $ 69,083 $ 67,525
available-for-sales equivalents
Prepaid program cost and expenses 27,677 24,362 1,608
Less: Participants' deposits (62,404) (47,608) (28,220)
Less: Accounts payable/accruals/other
liabilities (24,094) (15,045) (8,010)
-------- -------- -----------
Deployable cash $ 40,052 $ 30,792 $ 32,903
======== ======== ===========
Management believes this non-GAAP measure is useful to investors
in understanding the cash available to deploy for future business
opportunities.
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