Crystal Systems Solutions Announces Second Quarter Results; Gross Profit Margins Widen; Positive Net Income.Business Editors HERZLIA Herzlia: see Herzliya, Israel. , Israel--(BUSINESS WIRE)--Aug. 13, 2002 Crystal Systems Solutions Ltd. (Nasdaq:CRYS Crys are a Welsh heavy rock/metal band from Resolven, South Wales, United Kingdom. The band was formed in 1976 by brothers Liam (Vocals, Rhythm guitar) and Scott Forde (Bass guitar) while attending boarding school in Hereford, England. ), a global provider of leading software products and support services support services Psychology Non-health care-related ancillary services–eg, transportation, financial aid, support groups, homemaker services, respite services, and other services for the modernization modernization Transformation of a society from a rural and agrarian condition to a secular, urban, and industrial one. It is closely linked with industrialization. As societies modernize, the individual becomes increasingly important, gradually replacing the family, of existing information systems, today announced its financial results for the second quarter and six months ended June June: see month. 30, 2002. Revenues for the second quarter of 2002 were $7.5 million, 7% lower than in the previous quarter. Gross profit margins Gross profit margin Gross profit divided by sales, which is equal to each sales dollar left over after paying for the cost of goods sold. gross profit margin A measure calculated by dividing gross profit by net sales. for the second quarter of 2002 were 61%, compared to 60% for the first quarter of 2002. The Company reported a net income for the second quarter of 2002 of $26K, compared to a net loss of $238K for the first quarter of 2002. The increased gross profit margins compared to the same period last year were largely due to the company's focus on license sales and fixed price projects, and a significantly reduced expense structure. Revenues for the first six months of 2002 were $15.6 million, compared to $21.2 million for the first six months of 2001. Gross profit margins for the first half of 2002 were 61%, compared to 52% for the first six months of 2001. The Company reported a net loss for the first half of 2002 of $210K, or $(0.02) per share, compared to a net loss of $6.3 million, or $(0.83) per share in the first half of 2001. "Revenues for the second quarter were impacted by the continuing cautious approach of companies to engage in major capital expenditures, and the ongoing trend to procure To cause something to happen; to find and obtain something or someone. Procure refers to commencing a proceeding; bringing about a result; persuading, inducing, or causing a person to do a particular act; obtaining possession or control over an item; or making a person products and services in a phased approach," observed Chanan Weiss, Chief Executive Officer. "Nevertheless, it's it's 1. Contraction of it is. 2. Contraction of it has. See Usage Note at its. it's it is or it has it's be ~have encouraging to see that gross margins continue to increase as a result of our restructured business model, which focuses more on license sales and fixed price projects. Moreover, our bottom line improved, achieving operating profitability and a positive cash flow due to the comprehensive cost-control programs we implemented last year. "The positive second quarter results have been achieved in spite of in opposition to all efforts of; in defiance or contempt of; notwithstanding. See also: Spite the MCI (1) (Media Control Interface) A high-level programming interface from Microsoft and IBM for controlling multimedia devices. It provides commands and functions to open, play and close the device. (2) (Microwave Communications Inc. WorldCom The former name of MCI. Based in Jackson, MS, WorldCom, Inc. was a major, international telecommunications carrier. It was founded in 1983 by Bernard Ebbers as Long Distance Discount Service (LDDS), a reseller of AT&T WATS lines to small businesses. affair, which resulted in the loss of an expected annual income of $2 million, predominantly pre·dom·i·nant adj. 1. Having greatest ascendancy, importance, influence, authority, or force. See Synonyms at dominant. 2. from the revenue assurance sector. I believe that this cut will be counterbalanced coun·ter·bal·ance n. 1. A force or influence equally counteracting another. 2. A weight that acts to balance another; a counterpoise or counterweight. tr.v. by the sale of Crystal's legacy modernization tools, which offer a high return on investment. "Whether via revenue assurance or cost-saving legacy modernization, Crystal's tools are ideally positioned in this period of budgetary constraints CONSTRAINTS - A language for solving constraints using value inference. ["CONSTRAINTS: A Language for Expressing Almost-Hierarchical Descriptions", G.J. Sussman et al, Artif Intell 14(1):1-39 (Aug 1980)]. ," concluded Chanan Weiss. Mr. Gad Goldstein Gold·stein , Joseph Leonard Born 1940. American biochemist. He shared a 1985 Nobel Prize for discoveries related to cholesterol metabolism. , Chairman of the Board, added, "I am satisfied with our overall performance in these difficult and uncertain economic times. Looking forward, Crystal, and its subsidiary Mainsoft, continue to invest in the development of sophisticated modernization tools. The recurring re·cur intr.v. re·curred, re·cur·ring, re·curs 1. To happen, come up, or show up again or repeatedly. 2. To return to one's attention or memory. 3. To return in thought or discourse. deals with leading software developers, such as Siebel For the tech company, see . Siebel, originally Flugzeugbau Halle, was a German aircraft manufacturer in Halle an der Saale. Siebel aircraft included:
v. au·to·mat·ed, au·to·mat·ing, au·to·mates v.tr. 1. To convert to automatic operation: automate a factory. 2. tools with a proven history of a high return on investment. We will take advantage of opportunities in all our target markets, continue to improve our products, and keep close control of our expenses." Conference Call Details: Gad Goldstein Chairman, of the Board, and Iris Yahal, the company's Chief Financial Officer, will discuss the second quarter results and will be available to answer questions in a conference call on: Tuesday, August 13, 2002 at 10 A.M. (EST EST electroshock therapy. EST abbr. electroshock therapy ) / 5 P.M. Israel time. To participate, please call In the US call: 888/428-4473 Outside the US call: 612/332-0107 Callers should reference "Crystal Systems Solutions Second Quarter Results" to the AT&T conference call operator. An automated replay of the conference call will be available from August 13 at 2 P.M. through August 15 at 11:59 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 access the replay, please call (USA) 800/475-6701, (International) 320/365-3844. Callers should enter Crystal's access code: 648629. About Crystal Systems Solutions Crystal Systems Solutions Ltd. develops solutions that enable clients to efficiently manage the IT assets at their disposal, including legacy applications, modern application packages, middleware Software that functions as a conversion or translation layer. It is also a consolidator and integrator. Custom-programmed middleware solutions have been developed for decades to enable one application to communicate with another that either runs on a different platform or comes from a , and networking technologies. Its products provide cross-platform software renovation, modernization, and IT asset management solutions that are designed to accelerate the process of mission-critical legacy renewal, integration, and maintenance during an application's entire life cycle. For more information, please visit our web site at http://www.crystal-sys.com. Crystal Systems Solutions is a member of the Formula Group (Nasdaq:FORTY). The Formula Group is an international information technology company principally engaged, through its subsidiaries and affiliates, in providing software consulting services Noun 1. consulting service - service provided by a professional advisor (e.g., a lawyer or doctor or CPA etc.) service - work done by one person or group that benefits another; "budget separately for goods and services" , developing proprietary software products, and providing computer-based solutions. 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. : Certain statements contained in this release may be deemed 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. , with respect to plans, projections, or future performance of the Company, the occurrence of which involves certain risks and uncertainties that could cause actual plans to differ materially from these statements. These risks and uncertainties include but are not limited to: market demand for the Company's tools, successful implementation of the Company's tools, competitive factors, the ability to manage the Company's growth, the ability to recruit and retrain re·train tr. & intr.v. re·trained, re·train·ing, re·trains To train or undergo training again. re·train additional software personnel, and the ability to develop new business lines. This press release is also available at www.crystal-sys.com. All names and trademarks are their owners' property.
CRYSTAL SYSTEMS SOLUTIONS LTD.
(AN ISRAELI CORPORATION)
CONSOLIDATED STATEMENT OF INCOME
(In thousands, except per-share data)
Six months ended Three months ended
June 30, June 30,
------------------ ------------------
2002 2001 2002 2001
-------- -------- -------- --------
Revenues $15,568 $21,165 $7,515 $10,151
Cost of revenues 6,137 10,201 2,946 4,868
-------- -------- -------- --------
Gross profit 9,431 10,964 4,569 5,283
Software development costs 3,701 4,675 1,828 2,300
Selling, general and
administrative expenses 4,830 9,293 2,351 4,330
-------- -------- -------- --------
EBITDA 900 (3,004) 390 (1,347)
Depreciation 592 857 294 447
Amortization of goodwill - 821 - 465
Goodwill impairment,
Restructuring costs
& Non-recurring expenses - 1,724 - 854
-------- -------- -------- --------
Operating income (loss) 308 (6,406) 96 (3,113)
Financial income (expenses), net 92 (275) 159 (125)
Other income (loss), net 105 (136) (1) (129)
-------- -------- -------- --------
Income (loss) before taxes 505 (6,817) 254 (3,367)
Taxes on income 55 78 24 0
-------- -------- -------- --------
450 (6,895) 230 (3,367)
Minority interest (244) 1,158 12 704
Equity in losses of affiliated
companies, net (418) (527) (216) (187)
-------- -------- -------- --------
Net income (loss) (212) (6,264) 26 (2,850)
======== ======== ======== ========
Basic earnings per share $(0.02) $(0.63) 0.00 $(0.30)
======== ======== ======== ========
Diluted earnings per share $(0.02) $(0.63) 0.00 $(0.30)
======== ======== ======== ========
Common shares outstanding 10,062 9,909 10,074 9,860
======== ======== ======== ========
Common shares assuming dilution 10,062 9,950 10,074 9,860
======== ======== ======== ========
CRYSTAL SYSTEMS SOLUTIONS LTD.
(AN ISRAELI CORPORATION)
CONSOLIDATED BALANCE SHEETS
(In thousands)
June 30, December 31
2002 2001
-------- --------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $10,104 $9,374
Marketable securities 834 574
Accounts receivable:
Trade 10,107 12,171
Other 1,811 2,253
-------- --------
Total current assets 22,856 24,372
-------- --------
INVESTMENTS 9,549 8,053
-------- --------
FIXED ASSETS
Cost 9,845 9,799
Less - accumulated depreciation 6,762 6,449
-------- --------
Total fixed assets 3,083 3,350
-------- --------
OTHER ASSETS, NET 19,280 18,892
-------- --------
Total assets $54,768 $54,667
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Short-term bank credit $3,718 $2,280
Accounts payable and accruals:
Trade 3,535 5,261
Other 6,906 6,930
-------- --------
Total current liabilities 14,159 14,471
-------- --------
LONG-TERM LIABILITIES:
Accrued severance pay, net 622 702
Loans from banks and others 285 281
-------- --------
Total long-term liabilities 907 983
-------- --------
MINORITY INTEREST 4,212 3,956
-------- --------
SHAREHOLDERS' EQUITY
(net of cost of 1,766,100
shares held by subsidiaries) 35,490 35,257
-------- --------
Total liabilities and
shareholders' equity $54,768 $54,667
======== ========
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