Cass Information Systems Reports 2nd Quarter 2003 Earnings.Business Editors ST. LOUIS--(BUSINESS WIRE)--July 17, 2003 Cass Information Systems, Inc. (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 :CASS), the nation's leading provider of freight and utility invoice An itemized statement or written account of goods sent to a purchaser or consignee by a vendor that indicates the quantity and price of each piece of merchandise shipped. A consular invoice is one used in foreign trade. payment, rating, auditing and information services See Information Systems. , reported second quarter earnings of 66 cents per 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. share matching the results of the same period last year. Total net income for the quarter was $2,239,000, compared to $2,231,000 in 2002. For the six-month period ended June 30, 2003, the company generated $1.11 fully 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 , a 5% increase over the $1.06 fully diluted earnings per share reported for the first half of 2002. Net income was $3,757,000, compared to $3,577,000 in 2002. The results for the second quarter included a 15%, or $2,211,000, increase in revenue. Despite a lethargic economy, the addition of new customers enabled Cass to boost utility transaction volume by 32% and transportation transaction volume by 9% in the quarter. 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, these levels have increased 34% and 12% respectively. Revenues also increased as a result of Cass consolidating the operating results of a software subsidiary, Government e-Management Solutions (GEMS). The subsidiary, which markets integrated financial, property and human resource management systems to the public sector, generated second quarter revenues of $1,829,000. Offsetting the boost in information revenue was a $949,000 decrease in net investment income. The continuing effects of a low interest rate environment caused the decrease. Partially offsetting the decrease in interest income was an additional gain of $418,000 on the sale of securities compared to the second quarter of 2002. Operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. rose 18% in the quarter, attributable mainly to the GEMS' consolidation. Prior to Dec. 31, 2002, GEMS was accounted for as an asset held for sale and its operating results were not consolidated with those of the company. Statement of Financial Accounting Standards No.144, adopted by the company in 2002, now requires that GEMS be reclassified as an asset held and used. Consequently, Cass reclassified the entity's net assets Net assets The difference between total assets on the one hand and current liabilities and noncapitalized long-term liabilities on the other hand. net assets See owners' equity. and consolidated its operations with the parent company on Jan. 1, 2003. Excluding the effect of the consolidation, second quarter operating expenses were 3% higher than those reported in the same period of 2002. The increase is mainly attributable to increased salaries and benefit expenses related to higher processing volume. "The prevailing low interest rate environment continues to adversely affect revenue," commented Lawrence A. Collett, chief executive officer and chairman of the board. "To date, we have successfully mitigated mit·i·gate v. mit·i·gat·ed, mit·i·gat·ing, mit·i·gates v.tr. To moderate (a quality or condition) in force or intensity; alleviate. See Synonyms at relieve. v.intr. To become milder. some of the effect by capitalizing on gains in our securities portfolio and by increasing processing An increasing process is a stochastic process where the random variables volumes and associated revenues. We remain confident in our ability to grow our information processing information processing: see data processing. information processing Acquisition, recording, organization, retrieval, display, and dissemination of information. Today the term usually refers to computer-based operations. businesses. If current interest rate levels linger lin·ger v. lin·gered, lin·ger·ing, lin·gers v.intr. 1. To be slow in leaving, especially out of reluctance; tarry. See Synonyms at stay1. 2. , it could negatively affect the results of such growth." Selected Consolidated Financial Data The following table presents selected unaudited consolidated financial data (in thousands, except share and per share data) for the periods ended June 30, 2003 and 2002.
Six Six
Quarter Quarter Months Months
Ended Ended Ended Ended
6/30/03 6/30/02 6/30/03 6/30/02
Transportation Invoice
Volume 5,810 5,316 11,476 10,275
Transportation Dollar
Volume $2,154,256 $1,886,067 $4,208,168 $3,727,704
Utility Transaction
Volume 1,116 845 2,149 1,607
Utility Dollar Volume $ 788,714 $ 589,295 $1,614,075 $1,193,662
Payment and Processing
Fees $ 6,870 $ 6,122 $ 13,839 $ 11,673
Software Revenue 1,829 -- 3,607 --
Net Investment Income 6,485 7,434 13,074 14,712
Gain on Sale of Debt
Securities 1,362 944 1,362 944
Other 601 436 1,156 889
---------- ---------- ---------- ----------
Total Revenues $ 17,147 $ 14,936 $ 33,038 $ 28,218
Salaries and Benefits $ 9,400 $ 7,897 $ 18,752 $ 15,503
Occupancy 457 384 893 748
Equipment 1,121 1,115 2,282 2,204
Other 2,893 2,317 5,721 4,582
---------- ---------- ---------- ----------
Total Operating
Expenses $ 13,871 $ 11,713 $ 27,648 $ 23,037
Income before Income
Taxes $ 3,276 $ 3,223 $ 5,390 $ 5,181
Provision for Income
Taxes $ 1,037 $ 992 $ 1,633 $ 1,604
Net Income $ 2,239 $ 2,231 $ 3,757 $ 3,577
Average Earning Assets $ 534,810 $ 543,006 $ 534,564 $ 539,930
Net Interest Margin 5.02% 5.84% 5.15% 5.78%
Allowance for Loan
Losses to Loans 1.22% 1.24% 1.22% 1.24%
Non-performing Loans
to Total Loans .39% .16% .39% .16%
Net Loan Charge-offs
to Loans -- .02% -- .02%
Provision for Loan
Losses $ -- $ 180 $ 90 $ 270
Non-performing Loans $ 1,728 $ 650 $ 1,728 $ 650
Basic Earnings per
Share $ .67 $ .67 $ 1.12 $ 1.07
Diluted Earnings per
Share $ .66 $ .66 $ 1.11 $ 1.06
About Cass Information Systems Cass has been a leading provider of payables Payables Related: Accounts payable services and information support systems to companies throughout North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. since 1956. The company pays over $10 billion annually in freight and utility invoices on behalf of its customers from processing centers in St. Louis, Mo., Columbus, Ohio Columbus is the capital and the largest city of the American state of Ohio. Named for explorer Christopher Columbus, the city was founded in 1812 at the confluence of the Scioto and Olentangy rivers, and assumed the functions of state capital in 1816. and Boston, Mass. The support of its bank subsidiary, Cass Commercial Bank, founded in 1906, makes Cass Information Systems unique in the industry. Note to Investors Certain matters set forth in this news release may contain 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 provided to assist in the understanding of anticipated future financial performance. However, such performance involves risks and uncertainties that may cause actual results to differ materially from those in such statements. For a discussion of certain factors that may cause such forward-looking statements to differ materially from the company's actual results, see the company's 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. for the year ended December 31, 2002. |
|
||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion