BTG Reports Second Consecutive Quarter of Profitable Financial Results; Operating Income Up 76% from Q1.FAIRFAX Fairfax, city (1990 pop. 19,622), historic seat of Fairfax co., NE Va., a residential suburb of Washington, D.C.; inc. 1892, as a city 1961 (at which time it became independent and no longer included in a county). There is some light manufacturing. , Va.--(BUSINESS WIRE)--Oct. 22, 1998--BTG, Inc. (Nasdaq: BTGI), an information systems and services company, today announced unaudited financial results for its fiscal year 1999 second quarter, which ended September September: see month. 30, 1998. This is the company's second financial report since the 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 division. Because of the divestiture, the company finds it more meaningful to present financial results of the second quarter with the first quarter of this fiscal year. Revenue for the quarter was $88.2 million, compared to $84.6 million in the first quarter; net income was $93,000, up from $82,000 reported for the quarter ending June 30. Net income in the second quarter included a loss of $404,000, on a pretax pre·tax adj. Existing before tax deductions: pretax income. pretax adj [profit] → vor (Abzug der) Steuern basis, from the sale of 1.1 million shares of common stock in Government Technology Services, Inc. (GTSI GTSI Government Technology Services, Incorporated GTSI Greyhound Travel Services, Inc. (former subsidiary of Greyhound Lines) GTSI Government Technology Services Inc. ). This stock was received in consideration for the sale of substantially all of BTG's product reselling division to GTSI in February 1998. (See 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 release 98-18, July 30, 1998.) 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 for the quarter were $0.01, the same as in the previous quarter. 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. EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. would have been $0.04 without the loss from the sale of the GTSI stock. For the first six months of FY 1999, from April 1 to September 30, 1998, BTG reported revenue of $172.8 million, net income of $175,000, and diluted EPS of $0.02. 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 he continues to be very pleased with the progress of the company in the 1999 fiscal year. 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 second quarter increased by 76%, from $785,000 in the first quarter to $1.4 million. He said other highlights of the quarter include the continuing reduction of debt, which fell 23% from $40 million on June 30, 1998 to $31 million on September 30 while payables Payables Related: Accounts payable decreased 46% from $37 million at the end of the first quarter to $20 million at the end of the second. As a result, interest expense fell 50%, from $1.7 million to $840,000. The company also continues to reduce indirect general and administrative (G&A) expenses as a percentage of revenue. Bersoff said the six months of profitable growth in this fiscal year are the result of management's concentration on the threefold strategy implemented in last year's fourth quarter, following the divestiture of the product reselling division and the restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). of the company. "Our strategy focuses on the continuing reduction of debt, the expansion of our core business expertise in systems integration and engineering services within our traditional government client base, and the migration of that expertise to clients in the commercial sector. Management's implementation of this strategy has returned us to profitability and I believe it will continue to drive our growth." BTG provides information systems integration and engineering services to government and commercial clients. More information about BTG is available on the Web at www.btg.com, by e-mail at info@btg.com, or by calling 703-383-8000. 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 in this news 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 forward-looking statements. These risks and uncertainties include the review by regulatory authorities Noun 1. regulatory authority - a governmental agency that regulates businesses in the public interest regulatory agency administrative body, administrative unit - a unit with administrative responsibilities , the Company's dependence on contractual commitments and continued funding of U.S. government programs, government contract procurement The fancy word for "purchasing." The procurement department within an organization manages all the major purchases. and termination risks, and other risks described in the Company's Securities and Exchange Commission filings. -Financials Follow- -0-
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
9/30/98 6/30/98 9/30/98 9/30/97
Revenue:
Contract revenue $ 46,556 $ 43,656 $ 90,212 $ 86,911
Product sales 41,660 40,927 82,587 221,996
88,216 84,583 172,799 308,907
Direct costs:
Contract costs 31,277 29,293 60,570 59,484
Cost of product sales 40,414 39,478 79,892 202,597
Indirect, general and
administrative expenses 14,778 14,751 29,529 43,284
Amortization and other
operating costs, net 365 276 641 694
Operating income 1,382 785 2,167 2,848
Interest expense (840) (1,693) (2,533) (3,648)
Equity in earnings
of affiliate 24 -- 24 --
Gain (loss) on sale of
investments (404) 1,051 647 --
Income (loss) from
continuing operations
before income taxes 162 143 305 (800)
Income tax expense (benefit) 69 61 130 (199)
Income from continuing
operations 93 82 175 (601)
Loss from discontinued
operations of CNI,
net of income taxes -- -- -- (1,499)
Net income (loss) $ 93 $ 82 $ 175 $ (2,100)
Basic earnings (loss)
per share $0.01 $0.01 $ 0.02 $ (0.25)
Diluted earnings (loss)
per share $0.01 $0.01 $ 0.02 $ (0.25)
Weighted average shares
outstanding (used in
calculation of basic
earnings per share) 8,803 8,679 8,741 8,501
Weighted average shares
outstanding (used in
calculation of diluted
earnings per share) 8,819 8,743 8,790 8,501
BTG, Inc. and Subsidiaries
CONSOLIDATED BALANCE SHEETS
September 30, 1998 and March 31, 1998
September 30, 1998
(unaudited) March 31, 1998
ASSETS
Current assets:
Investments, at
fair value $ 4,566 $ 22,286
Receivables, net 65,105 135,050
Inventory, net 1,586 2,214
Prepaid expenses 3,990 3,338
Income tax receivable 1,501 10,348
Other 5,053 9,128
Total current assets $ 81,801 $ 182,364
Property and equipment,
net 4,129 4,508
Other assets:
Goodwill, net 8,681 8,860
Other intangible assets,
net 469 874
Investments in
unconsolidated affiliates 9,396 14,813
Other 976 1,020
$ 105,452 $ 212,439
LIABILITIES AND
SHAREHOLDERS' EQUITY
Current liabilities:
Current maturities
of long-term debt $ -- $ 15,000
Current maturities
of line of credit -- 31,417
Accounts payable 20,286 74,573
Accrued expenses 14,798 13,483
Other 2,627 4,079
Total current
liabilities $ 37,711 $ 138,552
Line of credit,
excluding current
maturities 30,742 38,835
Other 1,969 1,992
Total liabilities $ 70,422 $ 179,379
Shareholders' equity:
Common stock $ 54,561 $ 53,384
Accumulated deficit (20,355) (20,530)
Treasury stock, at cost (32) (527)
Unrealized gains on
investments, net of
related tax effects 856 733
Total shareholders'
equity $ 35,030 $ 33,060
$ 105,452 $ 212,439
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