BTG Reports Third Quarter Financial Results.Business Editors FAIRFAX, Va.--(BUSINESS WIRE)--Jan. 27, 2000 Increased 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. , Net Income and 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. 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 2000 third quarter, which ended December 31, 1999. Net income for the third quarter was $1.1 million, compared to a loss of $268,000 for the same quarter last year. 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 third quarter were $0.13, compared to a loss of $0.03 reported for last year's comparable period. Revenue for the third quarter was $59.3 million, down from $84.0 million in the third quarter of fiscal 1999. This was due to a 74% 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 unit in February of 1998. Revenue from information systems and technical services in the third quarter was up 19% over the same period of fiscal 1999. The company's operating income rose to $2.5 million, a significant increase over the $1.1 million reported in last year's third quarter. Net interest costs decreased 40% to $471,000, compared to $787,000 in the third quarter of fiscal 1999. For the first nine months of FY 2000, April 1 through December 31, 1999, BTG reported revenue of $189.6 million, net income of $3.2 million, and 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 of $0.35, which is 52% greater than the diluted EPS realized for all of fiscal 1999. Revenue from information systems and technical services increased 18% over the comparable period last year and operating income more than doubled to $7.2 million. Earnings 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 before interest, taxes, depreciation and amortization (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 ) for the quarter were $3.1 million or a fully diluted cash flow per share of $0.34. EBITDA for the first nine months of fiscal 2000 was $8.8 million, up 46% over the same period for fiscal 1999. 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. Dr. 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 is very pleased with the company's operating results: &uot;BTG continues to grow services revenue from an extensive base of existing contracts and new business. The balance sheet is appreciably ap·pre·cia·ble adj. Possible to estimate, measure, or perceive: appreciable changes in temperature. See Synonyms at perceptible. stronger than it was last year, and operating profit margins Operating profit margin The ratio of operating profit to net sales. continue to improve.&uot; He said the company is continually reviewing all aspects of its business to assess future strategic value. As a result of this assessment, BTG divested its product reselling unit two years ago, sold its Pentagon product reselling outlet in the second quarter of this fiscal year and, in the third quarter, decided 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 business unit responsible for its remaining product reselling contracts. Bersoff said, &uot;Product sales artificially depressed our profit margins and misrepresented our core competencies A core competency is something that a firm can do well and that meets the following three conditions specified by Hamel and Prahalad (1990):
DISCONTINUANCE, pleading. A chasm or interruption in the pleading. 2. of product sales allows us to focus on our primary business - information systems and technical services.&uot; Bersoff said the company is concentrating on increasing its bid backlog of services work by targeting larger, long-term opportunities in the federal government sector, coupled with the development of state and local business through BTG's Technologies in Schools practice. He added: &uot;Executive Vice President Paul Leslie, our new Chief Operating Officer Chief Operating Officer (COO) The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. , is providing strong leadership in growing day-to-day operations while reducing non-strategic costs. The management expertise he has brought to our business operations Business operations are those activities involved in the running of a business for the purpose of producing value for the stakeholders. Compare business processes. The outcome of business operations is the harvesting of value from assets points to a bright future for BTG.&uot; He said that highlights for the quarter just ended include: -- the selection of BTG to develop a state-of-the-art digital production capability for the Defense Intelligence Agency Noun 1. Defense Intelligence Agency - an intelligence agency of the United States in the Department of Defense; is responsible for providing intelligence in support of military planning and operations and weapons acquisition DIA to improve the speed, accuracy and security of intelligence reporting The preparation and conveyance of information by any means. More commonly, the term is restricted to reports as they are prepared by the collector and as they are transmitted by the collector to the latter's headquarters and by this component of the intelligence structure to one or more for analysts throughout the Department of Defense; -- an extension of BTG's Office Automation Integrated Support Services support services Psychology Non-health care-related ancillary services–eg, transportation, financial aid, support groups, homemaker services, respite services, and other services contract for the Department of Education, under which the company provides services ranging from integration and network operations to infrastructure/information assurance; and, -- the award of a five-year contract with the Headquarters, Department of the U.S. Army at the Pentagon, a continuation of BTG's 15 years of providing information technology support services to the Department. BTG is an information systems and technical services firm that provides solutions to complex information technology issues for government and commercial clients. More information 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.
BTG, Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
(In thousands, except Per Share Data)
Three Months Ended Nine Months Ended
Dec. 31, Dec. 31, Dec. 31, Dec. 31,
1999 1998 1999 1998
Revenues:
Contract Revenue $48,248 $40,513 $146,613 $124,086
Product sales 11,100 43,518 42,982 131,708
$59,348 $84,031 $189,595 $255,794
Direct costs:
Contract costs 31,682 25,931 95,830 80,507
Cost of product sales 10,261 42,233 41,087 127,206
$41,943 $68,164 $136,917 $207,713
Indirect, general and
administrative
expenses 14,750 13,060 45,000 42,605
Amortization expense 177 145 525 498
Restructuring charges -- 1,532 -- 1,532
$56,870 $82,901 $182,442 $252,348
Operating income $ 2,478 $ 1,130 $ 7,153 $ 3,446
Interest expense, net (471) (787) (1,348) (3,305)
Gain on sales of
investments, net -- 640 -- 1,287
Unusual charge -- (1,201) -- (1,201)
Other expenses -- (179) -- (155)
Income (loss) from
continuing operations
before income taxes $2,007 ($397) $5,805 $72
Income tax expense
(benefit) 873 (177) 2,525 10
Income (loss) from
continuing
operations $1,134 ($220) $3,280 $62
Loss from discontinued
operations, net of
income taxes -- (48) (116) (155)
Net income (loss) $1,134 ($268) $3,164 ($93)
Basic earnings (loss)
per share $ 0.13 ($0.03) $0.36 ($0.01)
Diluted earnings (loss)
per share $ 0.13 ($0.03) $0.35 ($0.01)
Weighted average shares
outstanding (used in the
calculation of basic
earnings per share) 8,839 8,796 8,839 8,760
Weighted average shares
outstanding (used in the
calculation of diluted
earnings per share) 9,029 8,796 8,982 8,760
BTG, Inc. and Subsidiaries
CONSOLIDATED BALANCE SHEETS
December 31, 1999 and March 31, 1999
(In thousands)
Dec. 31, March 31,
1999 1999
(Unaudited)
ASSETS
Receivables, net $ 65,742 $ 53,281
Inventory, net 153 378
Prepaid expenses 1,595 2,786
Other 4,675 4,846
------------- ------------
Total current assets $ 72,165 $ 61,291
------------- ------------
Property and equipment, net 8,620 5,202
Goodwill, net 14,687 15,211
Other intangible assets, net -- 48
Restricted investments 6,429 6,429
Notes receivable 1,750 1,500
Other 878 696
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$ 104,529 $ 90,377
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current maturities of
long-term debt $ -- $ 1,700
Accounts payable 14,939 18,203
Accrued expenses 13,337 11,050
Income taxes currently payable 1,287 309
Other 4,267 3,134
------------- ------------
Total current liabilities 33,830 34,396
Line of credit 31,066 17,666
Other 1,147 2,304
------------- ------------
Total liabilities $ 66,043 $ 54,366
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Common stock 55,166 54,860
Treasury stock (1,310) (315)
Accumulated deficit (15,370) (18,534)
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Total shareholders' equity $ 38,486 $ 36,011
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$ 104,529 $ 90,377
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