Best Software Announces Record Revenue for the Third Quarter.RESTON Reston, uninc. city (1990 pop. 48,556), Fairfax co., N Va., a planned community established in 1961. A suburb of Washington, D.C., Reston is organized in a series of residential villages and commercial areas. , Va.--(BUSINESS WIRE)--Oct. 21, 1998--Best Software, Inc. (Nasdaq:BEST), the provider of corporate resource management software and services, today announced financial results for the third quarter, ended September September: see month. 30, 1998, highlighted by record revenue of $18.0 million and by 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 of $0.17. "We continue to experience strong growth from our core FAS and Abra Abra favorite concubine of Solomon. [Br. Lit.: Solomon on the Vanity of the World, Benét, 3] See : Mistresses Suite businesses," commented Tim Davenport Davenport, city (1990 pop. 95,333), seat of Scott co., E central Iowa, on the Mississippi River; inc. 1836. Bridges connect it with the Illinois cities of Rock Island and Moline; the three communities and neighboring Bettendorf, Iowa, are known as the Quad Cities. , 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. of Best Software. "At the same time, we are ramping up our new Best! Imperativ client/server An architecture in which the user's PC (the client) is the requesting machine and the server is the supplying machine, both of which are connected via a local area network (LAN) or wide area network (WAN). product line and growing our European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. operations." Best Software's total third quarter revenue grew 52% to $18.0 million compared to $11.8 million in the quarter ended September 30, 1997. License fees and royalties rose 53% to $9.0 million from $5.9 million with contributions from all major product lines and regions, particularly in the payroll payroll a list of employees, their salary rates, tax deductions, amounts paid, payroll tax, long service leave entitlements. and fixed asset areas. Services revenue increased 51% to $9.0 million from $5.9 million due to continued growth in support fees as well as contributions from professional services (job) professional services - A department of a supplier providing consultancy and programming manpower for the supplier's products. . 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. rose 61% to $2.7 million from $1.7 million for the same calendar quarter last year. Operating income was 15% of revenue in the current quarter compared with the 14% operating income margin achieved in the quarter ended September 30, 1997. Net income for the third quarter was $2.1 million and represented an 88% improvement over net income of $1.1 million in the same quarter in 1997. Diluted earnings per share of $0.17 rose from $0.12 in the quarter ended September 30, 1997. Revenue for the first three quarters of 1998 was $48.0 million compared to $32.6 million during the same periods in 1997, an increase of 47%. Pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma operating income for the nine-month period ended September 30, 1998 was $7.7 million compared with $4.1 million for the same period in 1997, an increase of 88%. On a year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. basis, pro forma diluted earnings per share were $0.48 with pro forma net income of $5.8 million, compared to pro forma earnings pro forma earnings Income not necessarily calculated in accordance with generally accepted accounting principles. For example, a company might report pro forma earnings that exclude depreciation expense and nonrecurring expenses such as restructuring costs. per share of $0.29 and pro forma net income of $2.5 million for the same period a year ago. The Company's pro forma financial results for the year to date exclude the $9.4 million pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta charge (and the related tax effect) associated with the acquisition of HR Management Software GmbH GmbH Gesellschaft mit Beschränkter Haftung (German: limited liability company; business entity) in March 1998. The pro forma results also normalize normalize to convert a set of data by, for example, converting them to logarithms or reciprocals so that their previous non-normal distribution is converted to a normal one. the income tax provision in the quarter ended March 31, 1997 to reflect the Company's current effective income tax rate of 38%, rather than the recorded tax benefit. As recorded, including the $9.4 million pre-tax charge in March 1998, net income for the year to date was $66,000 compared to net income for the nine months ended September 30, 1997 of $3.5 million. On a 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. per share basis, the year-to-date earnings were $0.01 compared with $0.42 for the same three quarters last year. Highlights since the Second Quarter earnings release include: -0-
-- Solomon Software, Inc. and Best Software expanded their
relationship in August to offer the industry-standard payroll
solution, Abra Payroll(R), for Solomon IV for Windows(R) 2.52,
and Solomon IV for BackOffice(R) 4.0. As it has for years with
Best Software's fixed asset products, Solomon will recommend Abra
Payroll as the preferred solution to its customers through its
channel partners.
-- Another strategic alliance was announced in October with Smart
Shop Software, Inc., a leading provider of Enterprise Resource
Planning manufacturing management software. Smart Shop has
integrated Best Software's comprehensive human resources and
payroll software solution, Abra Suite(TM), into the standard and
enterprise versions of its manufacturing application, Smart
Manager(TM), that company's flagship product.
-- Best Software announced that Dr. Frank W. King, a widely
recognized technologist and industry expert, had joined its board
of directors effective in June 1998. Dr. King also is the
president and CEO of PSW Technologies, a leading provider of
software development and systems integration services.
Best Software, with principal offices in Reston, Virginia Reston is an internationally known planned community whose goal was to revolutionize post-World War II concepts of land use and residential/corporate development in American suburbia. ; St. Petersburg, Florida St. Petersburg (often shortened to St. Pete) is a city in Pinellas County, Florida, United States. The city is known as a vacation destination for North American and European vacationers, as well as a politically important battleground in U.S. Presidential politics. ; Burlington, Ontario Burlington (2006 population 164,415) is a city located in the Golden Horseshoe, across Lake Ontario and Burlington Bay harbour from Hamilton, in Halton Region, Ontario, Canada. , Canada Canada (kăn`ədə), independent nation (2001 pop. 30,007,094), 3,851,787 sq mi (9,976,128 sq km), N North America. Canada occupies all of North America N of the United States (and E of Alaska) except for Greenland and the French islands of ; and Dusseldorf, Germany Germany (jûr`mənē), Ger. Deutschland, officially Federal Republic of Germany, republic (2005 est. pop. 82,431,000), 137,699 sq mi (356,733 sq km). is a leading provider of software and services that help organizations better manage their assets, people and budgeting processes. Its cost-effective cost-effective, n the minimal expenditure of dollars, time, and other elements necessary to achieve the health care result deemed necessary and appropriate. solutions complement core accounting systems and are scaleable, supporting Microsoft operating systems The following is a list of Microsoft operating systems. For the codenames that Microsoft gave their operating systems, see Microsoft codenames. Before Windows
Best Software will hold an investor conference call today at 5:30 p.m. EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT to review its results. Those US investors interested in participating should dial 800-425-7617 and reference the "Best Software Earnings Release Conference Call." Investors from outside the US or without access to the toll-free number should dial 212-748-2220. Forward looking statements in this release, including statements concerning market demand for the Company's products, are based on information available to the Company as of the date hereof here·of adv. Of this. hereof Adverb Formal or law of or concerning this Adv. 1. hereof - of or concerning this; "the twigs hereof are physic" . Such forward looking statements are made only as of the date hereof. The Company's actual results could differ materially from those stated or implied Inferred from circumstances; known indirectly. In its legal application, the term implied is used in contrast with express, where the intention regarding the subject matter is explicitly and directly indicated. by such forward looking statements due to risks and uncertainties associated with fluctuations in the Company's quarterly operating results, concentration of the Company's product offerings, development risks involved with new products and technologies, competition, international operations Internal Operations (I.O., IO or I/O) is a fictional American Intelligence Agency in Wildstorm comics. It was originally called International Operations. I.O. first appeared in WildC.A.T.S. volume 1 #1 (August, 1992) and was created by Brandon Choi and Jim Lee. , and other risk factors disclosed dis·close tr.v. dis·closed, dis·clos·ing, dis·clos·es 1. To expose to view, as by removing a cover; uncover. 2. To make known (something heretofore kept secret). in the Company's filings with the Securities and Exchange Commission. Best Software, FAS and Best! Imperativ are trademarks, and the Best logo is a registered trademark of Best Software, Inc. Abra and Abra Payroll are registered trademarks and Abra Suite is an unregistered trademark of Abra Software, Inc., a wholly-owned subsidiary of Best Software, Inc. Solomon Solomon, d. c.930 B.C., king of the ancient Hebrews (c.970–c.930 B.C.), son and successor of David. His mother was Bath-sheba. His accession has been dated to c.970 B.C. According to the Bible. Software and Solomon IV are trademarks of Solomon Software, Inc. Smart Manager is a trademark of Smart Shop Software Inc. Microsoft (Microsoft Corporation, Redmond, WA, www.microsoft.com) The most successful and influential software company. Microsoft's software and Intel's hardware pioneered the PC and revolutionized the computer industry. , Windows, Windows 95 and Windows NT are registered trademarks of Microsoft Corporation (company) Microsoft Corporation - The biggest supplier of operating systems and other software for IBM PC compatibles. Software products include MS-DOS, Microsoft Windows, Windows NT, Microsoft Access, LAN Manager, MS Client, SQL Server, Open Data Base Connectivity (ODBC), MS Mail, . All other trademarks are the property of their respective holders. The historical and pro forma results of operations for the quarter and nine months ended September 30 follow. -0-
Best Software, Inc.
Consolidated Financial Information - Unaudited
Pro Forma Consolidated Statements of Operations
(in thousands, except per share amounts)
Quarter Ended Nine-Months Ended
September 30 September 30
1998 1997 1998 1997
---- ---- ---- ----
Revenue:
License fees
and royalty $ 9,035 $ 5,889 $ 24,177 $ 16,237
Services 8,967 5,936 23,776 16,400
-------- -------- -------- --------
Total 18,002 11,825 47,953 32,637
-------- -------- -------- --------
Cost of revenue:
License fees
and royalty 422 556 1,317 1,730
Services 3,051 1,492 7,997 4,527
-------- -------- -------- --------
Total 3,473 2,048 9,314 6,257
-------- -------- -------- --------
Gross margin 14,529 9,777 38,639 26,380
-------- -------- -------- --------
Operating expenses:
Sales and marketing 6,559 4,418 17,110 12,267
Research and
development 2,898 2,077 7,719 5,463
General and
administrative
(Note 1) 2,336 1,584 6,142 4,561
-------- -------- -------- --------
Total 11,793 8,079 30,971 22,291
-------- -------- -------- --------
Operating income 2,736 1,698 7,668 4,089
Other income
(expense), net 606 82 1,758 (86)
-------- -------- -------- --------
Income before
income taxes 3,342 1,780 9,426 4,003
Income tax
provision (Note 2) 1,280 685 3,590 1,535
-------- -------- -------- --------
Net income $ 2,062 $ 1,095 $ 5,836 $ 2,468
-------- -------- -------- --------
-------- -------- -------- --------
Basic earnings per
common share $ 0.18 $ 0.15 $ 0.51 $ 0.35
-------- -------- -------- --------
-------- -------- -------- --------
Diluted earnings
per common share $ 0.17 $ 0.12 $ 0.48 $ 0.29
-------- -------- -------- --------
-------- -------- -------- --------
Basic shares used
in computing earnings
per share 11,610 7,437 11,389 7,058
-------- -------- -------- --------
-------- -------- -------- --------
Diluted shares used
in computing earnings
per share 12,284 8,848 12,122 8,487
-------- -------- -------- --------
-------- -------- -------- --------
Note 1. For the nine months ended September 30, 1998, excludes
$9.4 million related to the write-off of in-process research and
development related to the acquisition in March 1998 of HR Management
Software GmbH.
Note 2. The nine-month period ended September 30, 1997 reflects the
Company's current effective tax rate of 38%. As reported, Best
Software recorded an income tax benefit during the March 1997 quarter
of approximately 28% or $455,000 representing a $1.1 million one-time
benefit to the Company.
Best Software, Inc.
Consolidated Financial Information - Unaudited
Consolidated Statements of Operations
(in thousands, except per share amounts)
Quarter Ended Nine-Months Ended
September 30 September 30
1998 1997 1998 1997
---- ---- ---- ----
Revenue:
License fees
and royalty $ 9,035 $ 5,889 $ 24,177 $ 16,237
Services 8,967 5,936 23,776 16,400
-------- -------- -------- --------
Total 18,002 11,825 47,953 32,637
-------- -------- -------- --------
Cost of revenue:
License fees
and royalty 422 556 1,317 1,730
Services 3,051 1,492 7,997 4,527
-------- -------- -------- --------
Total 3,473 2,048 9,314 6,257
-------- -------- -------- --------
Gross margin 14,529 9,777 38,639 26,380
-------- -------- -------- --------
Operating expenses:
Sales and marketing 6,559 4,418 17,110 12,267
Research and
development 2,898 2,077 7,719 5,463
General and
administrative 2,336 1,584 15,512 4,561
-------- -------- -------- --------
Total 11,793 8,079 40,341 22,291
-------- -------- -------- --------
Operating income 2,736 1,698 (1,702) 4,089
Other income, net 606 82 1,758 (86)
-------- -------- -------- --------
Income before
income taxes 3,342 1,780 56 4,003
Income tax
provision (benefit) 1,280 685 (10) 455
-------- -------- -------- --------
Net income $ 2,062 $ 1,095 $ 66 $ 3,548
-------- -------- -------- --------
-------- -------- -------- --------
Basic earnings per
common share $ 0.18 $ 0.15 $ 0.01 $ 0.50
-------- -------- -------- --------
-------- -------- -------- --------
Diluted earnings
per common share $ 0.17 $ 0.12 $ 0.01 $ 0.42
-------- -------- -------- --------
-------- -------- -------- --------
Basic shares used
in computing earnings
per share 11,610 7,437 11,389 7,058
-------- -------- -------- --------
-------- -------- -------- --------
Diluted shares used
in computing earnings
per share 12,284 8,848 12,122 8,487
-------- -------- -------- --------
-------- -------- -------- --------
Consolidated Condensed Balance Sheets
(In thousands)
September 30 December 31
1998 1997
---- ----
Assets:
Cash, cash equivalents
and short term investments $46,740 $45,432
Accounts receivable,
net of allowances 6,601 4,661
Other current assets 4,394 2,399
Property and equipment, net 3,667 2,182
Other non-current assets 6,468 2,336
------- -------
Total assets $67,870 $57,010
------- -------
------- -------
Liabilities and Shareholders'
Equity:
Current deferred
maintenance and
services revenue $17,856 $14,918
Other current liabilities 14,856 11,025
Non-current deferred
maintenance and
services revenue 788 1,313
Other non-current
liabilities 374 --
------- -------
Total liabilities 33,874 27,256
------- -------
Total shareholders' equity 33,996 29,754
------- -------
Total liabilities and
shareholders' equity $67,870 $57,010
------- -------
------- -------
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