Crystal Systems Solutions Ltd. Announces First Quarter 2000 Financial Results.Business Editors HERZILIA, Israel--(BUSINESS WIRE)--May 15, 2000 Crystal Systems Solutions Ltd. (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 : 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 leading provider of cross-platform (software, hardware) cross-platform - A term that describes a language, software application or hardware device that works on more than one system platform (e.g. Unix, Microsoft Windows, Macintosh). E.g. Netscape Navigator, Java. software renovation and porting solutions, today announced its financial results for the first quarter ended March 31, 2000. Revenues from the company's new product lines reached $12M during the quarter, compared to $11M in the corresponding first quarter of 1999. Crystal's newly introduced suite of tools began to generate significant interest from key target markets during the quarter. The demand and initial market penetration Noun 1. market penetration - the extent to which a product is recognized and bought by customers in a particular market penetration - the act of entering into or through something; "the penetration of upper management by women" were both higher than originally expected. As anticipated, Crystal's gross income was offset due to much higher Research and Development costs, which are critical to meet the challenge of the integration of our generic technology based tools in the new markets, and especially to accommodate e-Business (Electronic-BUSINESS) Doing business online. The term is often used synonymously with e-commerce, but e-business is more of an umbrella term for having a presence on the Web. market needs. Furthermore, in comparison to the first quarter of 1999, Crystal doubled its sales force to take advantage of business opportunities and to exploit the challenges faced. Net income was $1.2M as compared to $2.4M in the first quarter of 1999. In the first quarter of FY2000 Crystal earned $0.11 per share as compared to $0.23 per share in the corresponding first quarter of 1999. Crystal is encouraged by the positive response in the marketplace to its tools, and is currently enhancing its sales force. The training, reorganization and expansion of its sales force; along with the addition of new strategic partners, distributors and value added Value Added The enhancement a company gives its product or service before offering the product to customers. Notes: This can either increase the products price or value. re-sellers (VARs), and the significant investments in creating market awareness of Crystal's multi-dimensional solutions, will begin to impact the company's financial results in the future. The company believes it will quickly be able to gain recognition as a market leader. The following highlights significant events since the beginning of this year: - C-MIDAS was ordered by, and is involved in two conversion projects of Database migration to advanced relational environments, at leading financial institutions in the US. - There has been increase in awareness of Crystal's strategic presence and activities in Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). . This includes:
a) Recognition of our tools by the European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. Market, and the addition of Cap-Gemini Europe to Crystal's strategic alliances; b) Winning of a large-scale large-scale adj. 1. Large in scope or extent. 2. Drawn or made large to show detail. large-scale Adjective 1. wide-ranging or extensive 2. C-Euro project with our partners in the Netherlands Netherlands (nĕth`ərləndz), Du. Nederland or Koninkrijk der Nederlanden, officially Kingdom of the Netherlands, constitutional monarchy (2005 est. pop. 16,407,000), 15,963 sq mi (41,344 sq km), NW Europe. ; c) The completion of a successful Euro conversion at a large European car manufacturer. - The completion of a substantial part of an innovative e-Business enabling MQSeries Messaging middleware from IBM that allows programs to communicate with each other across all IBM platforms, Windows, VMS and a variety of Unix platforms. Introduced in 1994, it provides a common programming interface (API) that programs are written to. The MQ stands for Message Queue. based project, that contains the conversion of Legacy code to XML XML in full Extensible Markup Language. Markup language developed to be a simplified and more structural version of SGML. It incorporates features of HTML (e.g., hypertext linking), but is designed to overcome some of HTML's limitations. , at a large leading Bank in Israel Israel, in the Bible Israel (ĭz`rēəl, ĭz`rāəl) [as understood by Hebrews,=he strives with God], according to the book of Genesis, name given to Jacob as eponymous ancestor of the Hebrews, the chosen people of God. . In this quarter we also started efforts in packaging this tool to meet international standards. - First budding budding, type of grafting in which a plant bud is inserted under the bark of the stock (usually not more than a year old). It is best done when the bark will peel easily and the buds are mature, as in spring, late summer, or early autumn. of eMaker and JavaMaker. Although not substantial yet, we already have two orders for these tools, one of which is also our first engagement in Japan. - The completion of "phase one" of our first C-Merge project. This phase has already enabled two large merged European banks to consolidate their applications into a uniform environment. - Positive developments in MainSoft. There has been a substantial expansion in the cooperation of our subsidiary MainSoft with 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, . The expanded terms of the agreement with 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. Corp., specifically relate to providing advanced graphical capabilities for the CAD/CAM CAD/CAM in full computer-aided design/computer-aided manufacturing. Integration of design and manufacturing into a system under direct control of digital computers. and Visual Simulation markets, yet unexploited by MainSoft. In addition, there has been a significant increase in sales of MainSoft's Windows for UNIX UNIX Operating system for digital computers, developed by Ken Thompson of Bell Laboratories in 1969. It was initially designed for a single user (the name was a pun on the earlier operating system Multics). , which enable the porting of Windows applications A program that is written to run under Microsoft's Windows operating system. Such applications typically run under all 32-bit versions of Windows, but earlier applications might also run under the 16-bit versions (Windows 3.x) as well. See Windows. to run natively on UNIX and LINUX operating systems Operating systems can be categorized by technology, ownership, licensing, working state, usage, and by many other characteristics. In practice, many of these groupings may overlap. . Worldwide leading independent software vendors such as Siebel Systems Siebel is a brand name of Oracle Corporation. Siebel Systems, Inc., founded by Thomas Siebel in 1993, was principally engaged in the design, development, marketing and support of CRM applications. , Dassault Systems and Mentor Mentor, in Greek mythology Mentor (mĕn`tər, –tôr'), in Greek mythology, friend of Odysseus and tutor of Telemachus. Graphics have been added to MainSoft's prestigious list of customers, which already includes Computer Associates International, Rational Software Corporation, Cadence cadence, in music, the ending of a phrase or composition. In singing the voice may be raised or lowered, or the singer may execute elaborate variations within the key. Design Systems and Bridge Information Technology Inc. "Crystal is highly encouraged by the positive indicators and responses received from the market", Mr. Gad Goldstein Gold·stein , Joseph Leonard Born 1940. American biochemist. He shared a 1985 Nobel Prize for discoveries related to cholesterol metabolism. , Crystal's Chairman of the Board, commented. "Therefore, our extensive efforts will continue and progress over the next few quarters to reach a leading market position, while continuous investment in R&D will complete our suite of tools and strengthen our strategic alliances to realize the benefits of the emerging e-Business market." About Crystal: Crystal Systems Solutions Ltd. has been providing proprietary software technologies and services for Fortune 1000 companies since 1987. Crystal's solutions include e-Business enabling for legacy systems, cross-platform migration and IT mergers and acquisitions (M&A). Crystal provides comprehensive enterprise products spanning mainframe, midrange midrange Epidemiology The halfway point or midpoint in a set of observations; for most data, MR is calculated as the sum of the smallest observation and the largest observation, divided by 2; for age data, one is added to the numerator; a midrange is usually and client/server computing platforms See platform. . Crystal has enhanced its expertise through the successful completion of projects for many prestigious organizations, establishing solid credibility and achieving global recognition and presence. Crystal is totally committed to supporting its customers, both directly and via its partners, offering end-to-end solutions (jargon) end-to-end solution - (E2ES) A term that suggests that the supplier of an application program or system will provide all the hardware and/or software components and resouces to meet the customer's requirement and no other supplier need be involved. Compare: turn-key solution. through consultancy, assistance and service in conjunction with its wide variety of proprietary software tools. For more information on Crystal's services and technologies, please visit the company's World Wide Web site at www.crystal-sys.com About Formula: Crystal, 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 business solutions. 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. All names and trademarks are their owners' property. -0-
CRYSTAL SYSTEMS SOLUTIONS LTD.
CONSOLIDATED FINANCIAL STATEMENTS
CONSOLIDATED BALANCE SHEETS
(in thousands)
March 31, December 31,
2000 1999
---------- -----------
Unaudited
----------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $22,723 $24,232
Marketable securities 7,110 7,513
Accounts receivable:
Trade 13,919 15,098
Other current assets 3,963 3,479
------ ------
Total current assets 47,715 50,322
------ ------
INVESTMENTS 7,102 3,253
------ ------
FIXED ASSETS
Cost 9,042 8,523
Less - accumulated depreciation 4,718 4,440
------ ------
Total fixed assets 4,324 4,083
------ ------
OTHER ASSETS, NET 9,476 10,441
------ ------
Total assets $68,617 $68,099
====== ======
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Short-term bank credit 1,263 3,309
Accounts payable and accruals:
Trade 2,494 3,599
Other 9,462 8,149
------ ------
Total current liabilities 13,219 15,057
------ ------
LONG-TERM LIABILITIES:
Accrued severance pay, net 753 718
Loans from banks 51 171
------ ------
Total long-term liabilities 804 889
------ ------
MINORITY INTEREST 3,087 4,410
------ ------
SHAREHOLDERS' EQUITY:
Share capital 23 21
Capital surplus 40,104 37,513
Retained earnings 21,963 20,792
------ ------
62,090 58,326
Less cost of 1,243,300 shares in treasury (10,583) (10,583)
------ ------
Total shareholders' equity $51,507 $47,743
------ ------
Total Liabilities $68,617 $68,099
------ ------
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share data)
Three months ended Year ended
March 31, December 31,
--------------------- ----------------
2000 1999 1999
--------- ---------- ----------------
(unaudited)
Revenues $12,004 $11,030 $45,907
Cost of revenues 5,153 5,267 20,924
----- ----- ------
Gross profit 6,851 5,763 24,983
----- ----- ------
Software development
costs 2,337 1,136 6,037
Selling, general and
administrative expenses 4,090 1,745 9,053
----- ----- ------
424 2,882 9,893
Amortization of goodwill 291 66 514
----- ----- ------
Operating income 133 2,816 9,379
Financial income, net 548 307 1,020
Other income (loss), net 985 (44) (69)
----- ----- ------
Income before taxes 1,666 3,079 10,330
Taxes on income - 200 646
----- ----- ------
1,666 2,879 9,684
Minority interest (274) (207) (876)
Equity in losses of
affiliated companies (302) (720) (843)
---- ----- ------
Net income $1,171 $2,370 $7,965
===== ===== ======
Basic earnings per share $0.12 $0.23 $0.81
==== ===== ======
Diluted earnings per
share $0.11 $0.23 $0.79
==== ===== ======
Common shares outstanding 9,974 10,104 9,802
===== ====== ======
Common shares assuming 10,520 10,490 10,106
====== ====== ======
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