CBT Group Reports Third Quarter Results.MENLO PARK Menlo Park. 1 Residential city (1990 pop. 28,040), San Mateo co., W Calif.; inc. 1874. Electronic equipment and aerospace products are manufactured in the city. Menlo College and a Stanford Univ. research institute are there. 2 Uninc. , Calif.--(BUSINESS WIRE)--Oct. 13, 1998--CBT Group PLC (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : CBTSY) today announced financial results for the third quarter ended Sept. 30, 1998. CBT (Computer-Based Training) Using the computer for training and instruction. CBT programs are called "courseware" and provide interactive training sessions for all disciplines. Group's revenues for the third quarter were $35.2 million, compared to $35.1 million in the third quarter of 1997. Net income for the third quarter was $2.9 million or $0.06 per equivalent American Depositary Share American Depositary Share (ADS) Foreign stock issued in the US and registered in the ADR system. , compared to $4.9 million or $0.11 per equivalent American Depositary Share before deducting after-tax af·ter-tax also af·ter·tax adj. Relating to or being that which remains after payment, especially of income taxes: after-tax profits. costs of acquisitions in the third quarter of 1997. "Obviously we are very disappointed with these results," said William William, crown prince of Germany William or Frederick William, 1882–1951, crown prince of Germany, son of William II. In World War I he commanded (1914) an army on the Western Front and was nominal commander in the German attack G. McCabe, CBT Group's former chairman and a member of the company's management committee. "As a result of the performance in the third quarter numbers and following a review of the underlying reasons behind this performance, it is the view of the board and the members of the management committee that significant operating challenges must be met and overcome in order to restore CBT Group to a path of growth and profitability. While the board believes that restoring the company to such a path is realistic and achievable, it is anticipated that this will take several quarters to bring about. "Notwithstanding the current challenges facing the company, CBT Group is the clear leader in the market for interactive IT education," McCabe added. "The company currently has significantly more revenues and profits than any of its competitors COMPETITORS, French law. Persons who compete or aspire to the same office, rank or employment. As an English word in common use, it has a much wider application. Ferriere, Dict. de Dr. h.t. . Crucially, CBT Group has a content library of more than 750 titles. In addition, CBT Group enjoys relationships with 19 IT vendors, a number of which are long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. and exclusive to the company. "Finally, CBT Group's significant financial strength is underlined by almost $100 million in cash and short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. investments on its balance sheet. Without question, a range of operating issues face the company; however, the board and members of the management committee believe that CBT Group occupies a pre-eminent pre·em·i·nent or pre-em·i·nent adj. Superior to or notable above all others; outstanding. See Synonyms at dominant, noted. [Middle English, from Latin prae market position and are determined to maintain and grow that leadership position," McCabe concluded. This press release contains statements that are forward looking. These statements are based on current expectations that are subject to risks and uncertainties. Actual results may vary because of factors such as product ship schedules, life cycles, terms and conditions, product mix, competitive products and pricing, customer demand, technological shifts, litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. and other issues discussed in the company's most recent annual report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. . About CBT Group CBT Group is a leading provider of interactive education software for information technology professionals in business, education and government markets worldwide. The company's comprehensive library, which covers a range of 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). , mainframe mainframe Digital computer designed for high-speed data processing with heavy use of input/output units such as large-capacity disks and printers. They have been used for such applications as payroll computations, accounting, business transactions, information retrieval, , and 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 and intranet technologies, is used by the world's leading corporations to train employees to develop and apply mission-critical technologies in the workplace. For information on CBT Group products, call (800) 387-0932, fax (650) 614-5901, or send an email to salesinfo@cbtsys.com. CBT Group is located on the World Wide Web at http://www.cbtsys.com. -0- Note to Editors: CBT Systems (CBT Systems, Menlo Park, CA) An acknowledged leader in the design and development of interactive education software for information technology training. Specializing in self-study courses that users can take at their own PCs, CBT developed a library of more than 600 titles for , CBT Campus, CBTWeb, CBTWeb Plus, LivePlay, and the CBT Systems logo are trademarks of CBT Group PLC. All other company and product names may be trademarks of the respective companies with which they are associated. -0-
CBT GROUP PLC
Condensed Consolidated Statements of Operations
(dollars in thousands, except per share amounts)
Three Months Nine Months
Ended September 30, Ended September 30,
1997 1998 1997 1998
(Unaudited)(Unaudited) (Unaudited)(Unaudited)
Revenues $ 35,136 $ 35,182 $ 91,618 $119,963
Cost of revenues 5,657 5,998 15,511 18,639
Gross profit 29,479 29,184 76,107 101,324
Operating expenses:
Research and
development 5,105 5,762 14,267 18,756
Sales and marketing 14,680 17,684 40,923 53,174
General and
administrative 2,624 4,179 8,588 10,987
Acquired research
and development 3,650 -- 4,097 --
Cost of acquisitions 242 -- 1,168 5,505
Total operating
expenses 26,301 27,625 69,043 88,422
Income from
operations 3,178 1,559 7,064 12,902
Other income, net 2,599 1,786 3,819 3,689
Income before provision
for income taxes 5,777 3,345 10,883 16,591
Provision for
income taxes 1,043 468 2,379 2,273
Net income 4,734 2,877 8,504 14,318
Net income per
equivalent ADS
(1) - Basic $ 0.12 $ 0.07 $ 0.21 $ 0.33
ADSs used in
computing net
income per 40,855 43,944 40,060 43,262
equivalent ADS
- Basic
Net income per
equivalent ADS (1) - $ 0.11 $ 0.06 $ 0.19 $ 0.31
Diluted
ADSs used in
computing net
income per equivalent 44,854 46,498 44,247 46,222
(1) Net income per equivalent ADS gives effect to both two-for-one
share splits of Registrants' ADSs effected in May 1996 and March
1998
CBT GROUP PLC
Condensed Consolidated Balance Sheets
( dollars in thousands)
December September
31, 30,
1997 1998
(Unaudited)
ASSETS
Current assets
Cash $35,505 $63,086
Short term investments 36,038 36,217
Accounts receivable, net 40,031 43,484
Inventories 615 701
Deferred tax assets, net 140 234
Prepaid expenses 4,198 5,830
Total Current Assets 116,527 149,552
Intangible Assets 5,600 4,502
Property and equipment, net 10,207 16,569
Investment 200 550
Deferred tax assets, net 342 47
Other assets 8,453 13,883
Total assets 141,329 185,103
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities 32,510 32,846
Total current liabilities 32,510 32,846
Non current liabilities 1,141 909
Shareholders' equity 107,678 151,348
Total liabilities and
shareholders' equity 141,329 185,103
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