BTG Reports 2nd Quarter, Six-Month Financial Results; Posts Strong Increases in EBITDA, Operating Income and Net Earnings.Business Editors/High Tech Writers FAIRFAX, Va.--(BUSINESS WIRE)--Oct. 25, 2000 BTG BTG BIT (Built-In Test) Target Generator BTG Bridging the Gap BTG British Technology Group BtG Betreuungsgesetz (Germany) BTG Biomass Technology Group BV BTG Begbies Traynor Group , Inc. (Nasdaq: BTGI), an information systems and technical services company, today announced unaudited financial results for its fiscal year 2001 second quarter, which ended September 30, 2000. Net 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 was $1.3 million for the quarter, and diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of were $0.14. Revenue for the quarter was $54.8 million, down from the $63.9 million reported in the same period last year. This was due to an 83% decrease in product sales resulting from BTG's divestiture The breakup of AT&T. By federal court order, AT&T divested itself on January 1, 1984 of its 23 operating companies, which became known as the Regional Bell Operating Companies (RBOCs). of its product reselling contracts in late 1999. The company's operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. for the three months was $3.1 million, a 23% increase from last year's second quarter; operating profit margin Operating profit margin The ratio of operating profit to net sales. increased to 5.7%, compared to 4.0% for the same period in fiscal 2000. Earnings before interest, taxes, depreciation, and amortization Earnings before interest, taxes, depreciation, and amortization (EBITDA) A financial measure defined as revenues less cost of goods sold and selling, general, and administrative expenses. (EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become ) were $3.8 million, or a 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. cash flow per share of $0.42. This compares to EBITDA of $3.0 million, or a fully diluted cash flow per share of $0.33, for the same period last year. For the first six months of fiscal 2001, net income from continuing operations was $2.7 million, a 26% increase from the same period last year. Diluted earnings per share were $0.30, a 30% increase over the $0.23 reported in the first half of fiscal 2000. Revenue from the company's core information systems and technical services business increased from $101.1 million last year to $110.4 million this year. Total revenue for the six months was $114.7 million, down from $130.2 million reported last year, again due to the company's decision to significantly reduce its efforts in the product reselling business. For the first six months of fiscal 2001, operating income was $6.5 million, a 39% increase from last year. Operating profit margin increased to 5.7%, compared to 3.6% for the same period in fiscal 2000. EBITDA was $7.8 million or a fully diluted cash flow per share of $0.86. This is a 34% increase from the EBITDA of $5.8 million and a fully diluted cash flow per share of $0.64 reported for the first half of last fiscal year. BTG President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. Edward H. Bersoff Edward H. Bersoff is the President, CEO and founder of BTG, Inc. Prior to founding BTG in 1982, Bersoff was President of CTEC, Inc. Previously, as an officer in the U.S. Army, he was assigned to the NASA Electronics Research Center in Cambridge, Massachusetts. said the company continues to improve its operating results while investing significantly in business development opportunities. "We have expanded and strengthened our business development and operations efforts with the hiring of several key individuals focused on our targeted markets. We have identified additional larger contract opportunities and the business development team is aggressively pursuing new and extended business. The results are beginning to show in new and follow-on contract awards. Our bid-and-proposal backlog Backlog The total value of sales orders waiting to be fulfilled. Notes: This figure is used mainly in the manufacturing industry. Increases or decreases in a company's backlog indicate the future direction of sales and earnings. at the end of September was $311.5 million and we have identified another $693 million in qualified pursuits for a total business pipeline in excess of one billion dollars. Our contract backlog - work that we are already contracted to perform, and a significant indicator of future growth - increased to $441 million." Bersoff said new and expanded contract awards since the beginning of the second quarter include the following: --The company was recently awarded a $69 million, five-year contract for the Joint Deployable Intelligence Support System A transportable workstation and communications suite that electronically extends a joint intelligence center to a joint task force or other tactical user. Also called JDISS. (JDISS JDISS Joint Deployable Intelligence Support System JDISS Joint Defense Intelligence Support System JDISS Joint Data Imagery Support System .) --BTG received two awards from the Joint Staff at the Pentagon Pentagon Huge five-sided building (1941–43) in Arlington, Va., that is the headquarters of the U.S. Department of Defense. Designed by George Edwin Bergstrom, it was, on its completion, the world's largest office building, covering 34 acres (14 hectares) and offering under the Information Technology Omnibus omnibus: see bus. Procurement The fancy word for "purchasing." The procurement department within an organization manages all the major purchases. (ITOP-II) contract: a $23 million contract for information technology support services support services Psychology Non-health care-related ancillary services–eg, transportation, financial aid, support groups, homemaker services, respite services, and other services that range from help desk operations to administration of the Joint Staff training program; and an $8 million information technology engineering, integration, and logistics support contract for systems planning, requirements analysis (project) requirements analysis - The process of reviewing a business's processes to determine the business needs and functional requirements that a system must meet. , integration engineering, computer lab testing and logistics activities. --BTG is a partner on the Veridian team selected as one of the primary information assurance providers on the $1.5 billion Defense Information systems Agency (DISA 1. (body) DISA - Defense Information Systems Agency. 2. (standard) DISA - Data Interchange Standards Association. ) contract for information security services Security services are state institutions for the provision of intelligence, primarily of a strategic nature, but also including protective security intelligence. Examples include the Security Service (MI5) and the Secret Intelligence Service (MI6) in the United Kingdom, and the . --The company won a series of new awards, with an estimated value of $8 million over three years, to provide Remedy-based solutions for trouble management and report management systems for defense and intelligence agencies. --BTG was awarded multiple delivery orders on contracts for the U.S. Army Intelligence and Security Command. The new orders have an estimated value of $5.5 million to BTG over the next year. Bersoff added that the company continues to make progress in reduction of long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. . As of September 30, total debt was $34.7 million, down from the $38.4 million reported at the end of the first quarter. He said the reduction of debt continued into the third quarter. On Monday, October 23, 2000, BTG received proceeds of approximately $5.5 million in cash from the sale of 1.3 million shares of common stock in GTSI GTSI Government Technology Services, Incorporated GTSI Greyhound Travel Services, Inc. (former subsidiary of Greyhound Lines) GTSI Government Technology Services Inc. Corp., representing all of BTG's remaining holdings in GTSI. The shares were repurchased by GTSI. Bersoff said that the company will recognize a pre-tax, non-operating loss in the third quarter of $910,000 in connection with the sale. However, he noted that by agreement with GTSI, BTG had been effectively prohibited pro·hib·it tr.v. pro·hib·it·ed, pro·hib·it·ing, pro·hib·its 1. To forbid by authority: Smoking is prohibited in most theaters. See Synonyms at forbid. 2. from selling any portion of its holdings until February 2004. "Although we will recognize a non-operating loss from this transaction, liquidating this investment several years before we would otherwise have been able to do so is clearly in the best interests of the company since it converts a restricted asset into cash." With these proceeds, plus cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses since October 1st, BTG's total debt as of October 25, is $32 million. BTG is an information systems and technical services firm that provides computer-based solutions for government and commercial clients. Information about BTG is available on the web at www.btg.com, by e-mail at info@btg.com, or by calling 703-383-8140. "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. " STATEMENT UNDER 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: The statements contained in this release which are not historical facts are 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. that are subject to risks and uncertainties that could cause actual results to differ materially from those set forth in or implied by these forward-looking statements. These risks and uncertainties include the amount of work actually to be awarded under any contract or subcontract sub·con·tract n. A contract that assigns some of the obligations of a prior contract to another party. intr. & tr.v. sub·con·tract·ed, sub·con·tract·ing, sub·con·tracts , dependence on continued funding of U.S. government programs, government contract procurement and termination risks, including risks associated with protests, and other risks described in the Company's Securities and Exchange Commission filings. For past press releases, visit this company's Corporate News On the Net site at http://www.businesswire.com/cnn
BTG, Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(In thousands, except Per Share Data)
Quarter Quarter Six Months Six Months
Ended Ended Ended Ended
9/30/00 9/30/99 9/30/00 9/30/99
------- ------- ---------- ----------
Revenues:
Contract revenue $52,485 $50,568 $110,433 $101,137
Product sales 2,268 13,343 4,243 29,110
------- ------- ---------- ----------
$54,753 $63,911 $114,676 $130,247
Direct costs:
Contract costs 33,555 33,328 72,124 66,696
Cost of product sales 2,014 12,830 3,943 28,278
------- ------- ---------- ----------
$35,569 $46,158 $76,067 $ 94,974
Indirect, general and
administrative expenses 15,768 15,041 31,552 30,250
Amortization expense 296 174 551 348
------- ------- ---------- ----------
$51,633 $61,373 $108,170 $125,572
------- ------- ---------- ----------
Operating income $ 3,120 $ 2,538 $ 6,506 $ 4,675
Interest expense, net (929) (448) (1,751) (877)
Loss on conversion of investment - - (50) -
------- ------- ---------- ----------
Income from continuing
operations before income
taxes $ 2,191 $ 2,090 $ 4,705 $ 3,798
Provision for income taxes (931) (909) (2,000) (1,652)
------- ------- ---------- ----------
Income from continuing
operations $ 1,260 1,181 2,705 2,146
Loss from discontinued
operations, net of income
taxes - (116) - (116)
------- ------- ---------- ----------
Net income $ 1,260 $ 1,065 $ 2,705 $ 2,030
======= ======= ========== ==========
Basic earnings per share $ 0.14 $ 0.12 $ 0.30 $ 0.23
======= ======= ========== ==========
Diluted earnings per share $ 0.14 $ 0.12 $ 0.30 $ 0.23
======= ======= ========== ==========
Weighted average shares
outstanding (used in the
calculation of basic
earnings per share) 9,005 8,836 8,997 8,839
======= ======= ========== ==========
Weighted average shares
outstanding (used in the
calculation of diluted
earnings per share) 9,129 9,062 9,119 8,966
======= ======= ========== ==========
BTG, Inc. and Subsidiaries
CONSOLIDATED BALANCE SHEETS
September 30, 2000 and March 31, 2000
(In thousands)
September 30, March 31,
2000 2000
------------- -----------
(Unaudited)
ASSETS
Investments, at fair value $ 68 $ -
Receivables, net 63,773 69,352
Inventory, net 533 507
Prepaid expenses and other 2,890 3,528
------------- -----------
Total current assets 67,264 73,387
------------- -----------
Property and equipment, net 9,107 9,043
Goodwill, net 23,771 14,551
Restricted investments 6,429 6,429
Notes receivable 1,000 1,000
Other 794 2,972
------------- -----------
$ 108,365 $107,382
============= ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current maturities of long-term debt $ 3,200 $ -
Accounts payable 15,662 21,342
Accrued expenses 10,856 12,840
Other 3,168 1,644
------------- -----------
Total current liabilities 32,886 35,826
Line of credit 29,046 30,466
Long-term debt, excluding current
maturities 2,418 -
Other 783 877
------------- -----------
Total liabilities 65,133 67,169
------------- -----------
Preferred stock $ - $ -
Common stock 54,681 54,308
Accumulated deficit (11,390) (14,095)
Unrealized holding losses on
investments, net of income taxes (59) -
------------- -----------
Total shareholders' equity 43,232 40,213
------------- -----------
$ 108,365 $107,382
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