DOCdata continues strong growth in first half 1998; Operating income up by 28% to NLG 9.7 million; Net income up by 36% to NLG 5.9 million.VUGHT Vught ( (helpinfo)) is a municipality and a town in the southern Netherlands. It is a town where lots of commuters live and has recently been named "Best place to live" by the Dutch magazine Elsevier. , The Netherlands--(BUSINESS WIRE)--July 21, 1998--DOCdata N.V. (Nasdaq: DOCDF, AEX AEX See: Amsterdam Exchange : DOCD DOCD Development Operations Coordination Document ).
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Six months ended June 30,
1998 1997
(In millions, except
percentage figures) NLG % NLG %
---------------------------------------
Net Sales 113.4 100.0 62.8 100.0
Gross Profit 30.5 26.9 20.4 32.4
EBITDA 19.4 17.1 13.1 20.8
EBIT 9.7 8.5 7.6 12.0
Net Income 5.9 5.2 4.3 6.8
Average Number of Shares 8.0 6.0
Net Income per Share in NLG 0.73 0.72
Net Income per Share in NLG -
potentially fully diluted 0.73
Sales Growth 80.5
----------------------------------------------------------------------
Sales by existing businesses increased by 15.4% to NLG NLG The ISO 4217 currency code for the Dutch Guilder. 72.5 million, new businesses contributed NLG 40.9 million resulting in an overall net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight growth of 80.5%. Existing businesses showed an increase in gross profit of 12.2% to NLG 22.9 million and an increase in operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. of 21.6% to NLG 9.2 million. The operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: of the existing businesses increased from 12.0% to 12.7%. The new businesses (acquired in the last 12 months), important for DOCdata's future growth, did well in terms of sales Terms of sale Conditions under which a firm proposes to sell its goods or services for cash or credit. and as a result improved the Media Group's market share. Due to start-up Start-up The earliest stage of a new business venture. costs of DOCdata Connectivity A generic term for connecting devices to each other in order to transfer data back and forth. It often refers to network connections, which embraces bridges, routers, switches and gateways as well as backbone networks. & Media, a software house specialized spe·cial·ize v. spe·cial·ized, spe·cial·iz·ing, spe·cial·iz·es v.intr. 1. To pursue a special activity, occupation, or field of study. 2. in communication- and media-applications, and losses in the combined California California (kăl'ĭfôr`nyə), most populous state in the United States, located in the Far West; bordered by Oregon (N), Nevada and, across the Colorado River, Arizona (E), Mexico (S), and the Pacific Ocean (W). operations primarily due to non-availability of reliable production capacity, the contribution of the new businesses to gross profit and 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. was still limited. The new businesses generated a gross profit of NLG 7.7 million and an operating income of NLG 0.5 million. As a result of the addition of the new businesses, the group's operating margin decreased from 12.0% to 8.5%. While the availability of the production capacity has been addressed, DOCdata continues to focus on improving the group's margins through a combination of focussing sales on higher margin products and services, and the addition of new 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. services rendered to customers. Management At his own request Mr. Jaap JAAP Joliet Army Ammunition Plant JAAP joint airborne advance party (US DoD) JAAP Journal of the American Academy of Psychoanalysis JAAP Joint Airprox Assessment Panel (UK) Ruigrok van der Werven, CFO See Chief Financial Officer. of the Company, will retire from the Company in the fourth quarter of 1998. He will be succeeded by Mr. Michiel Alting von Geusau. Mr. Alting von Geusau (age 34) is currently employed by Philips (company) Philips - A Dutch multinational electronics company. It produces washing machines, consumer electronics, integrated circuits and light bulbs. Together with Sony they set the Compact Disc standard, especially Green Book CD-ROM. Domestic Appliances domestic appliance domestic n → appareil ménager and Personal Care B.V. as Finance & Accounting Manager Domestic Appliances. Stock Option Plan In the first half of 1998, DOCdata implemented a stock option plan with a duration of five years to reward its employees. A total number of 400,000 stock options are available under the plan. Currently 86,540 stock options have been granted for a price of NLG 57.45 each. The main conditions of the plan are: -- The plan is applicable to all employees who are employed by the Company for at least one year; -- Employees are entitled en·ti·tle tr.v. en·ti·tled, en·ti·tling, en·ti·tles 1. To give a name or title to. 2. To furnish with a right or claim to something: to retain gains on sales of the underlying shares after a three year period; -- The exercise price will be calculated as the average of the closing prices of the DOCdata shares on the Amsterdam Exchanges Amsterdam Exchange (AEX) Exchange that comprises the AEX-Effectenbeurs, the AEX-Optiebeurs (formerly the European Options Exchange or EOE) and the AEX-Agrarische Termijnmarkt. over a period of 14 days following the offering. DOCdata is a leading independent service provider to the audio and multimedia publishers and software industries with facilities 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. , United Kingdom, France, 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). and the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. . DOCdata also provides industrial automation software design and 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" and designs and builds production systems based on optical and laser technology. Note: This statement should be read in conjunction with the enclosed en·close also in·close tr.v. en·closed, en·clos·ing, en·clos·es 1. To surround on all sides; close in. 2. To fence in so as to prevent common use: enclosed the pasture. financial statements. Note: The management of DOCdata will review the 1998 first half results today in a conference call for North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. and European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. investors and analysts. For other interested parties, the recorded conference call can be listened to afterwards af·ter·ward also af·ter·wards adv. At a later time; subsequently. afterwards or afterward Adverb later [Old English æfterweard] Adv. 1. . The conference call playback Playback could mean:
around the clock, round the clock . Net Sales Net sales increased 80.5% from NLG 62.8 million in the six months ended June June: see month. 30, 1997 to NLG 113.4 million in the six months ended June 30, 1998. Excluding the acquisitions of DOCdata UK in August 1997, the acquisitions of DOCdata California and Mastering Services in December December: see month. 1997, and the distribution activities of Arcade arcade, series of arches supported by columns or piers. An arcade may stand free; if it is attached to a wall it is called a wall arcade or a blind arcade. The earliest-known arcades were in Roman architecture, in which piers, ornamented with engaged columns carrying as per January January: see month. 1, 1998, net sales of DOCdata's existing businesses increased 15.4% to NLG 72.5 million. Media Group's total net sales increased 95.0%, excluding acquisitions net sales increased 16.5% primarily due to strong sales in CD-ROM CD-ROM: see compact disc. CD-ROM in full compact disc read-only memory Type of computer storage medium that is read optically (e.g., by a laser). . Total discs sold increased by 104.0%, 65.6% was attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to sales by acquisitions. Discs sold by the Media Group's existing businesses increased by 38.4% due to a 102.4% increase in CD-ROM unit sales unit sales Sales measured in terms of physical units rather than dollars. Unit sales data are often used by financial analysts when evaluating the health of a company. and a 1.1% increase of CD-Audio unit sales. Automation Group's net sales increased 10.0% attributable mainly to the growth of the consultancy and software operation.
(In thousands, except percentage figures)
Six months ended June 30,
1998 1997
--------------------------------
Net sales by division NLG % NLG %
--------------------------------
Media Group
- Existing business 60,699 53.5 52,095 82.9
- New business 40,872 36.1 - -
--------------------------------
101,571 89.6 52,095 82.9
Automation Group 11,789 10.4 10,718 17.1
--------------------------------
Total 113,360 100.0 62,813 100.0
--------------------------------
Geographic mix NLG % NLG %
----------------------------------
Netherlands
- Existing business 27,129 23.9 24,454 38.9
- New business 2,924 2.6 - -
----------------------------------
30,053 26.5 24,454 38.9
Germany
(existing business) 14,886 13.1 12,838 20.5
France
- Existing business 14,953 13.2 12,464 19.8
- New business 2,041 1.8 - -
----------------------------------
16,994 15.0 12,464 19.8
United Kingdom
(new business) 29,025 25.6 - -
United States
- Existing business 15,519 13.7 13,057 20.8
- New business 6,882 6.1
----------------------------------
22,401 19.8 13,057 20.8
Total
- Existing business 72,488 63.9 62,813 100.0
- New business 40,872 36.1 - -
----------------------------------
113,360 100.0 62,813 100.0
----------------------------------
(In thousands, except percentage figures)
Six months ended June 30,
1998 1997
-----------------------------------------------
Media Group's
unit sales Discs % Discs %
-----------------------------------------------
CD-Audio
CD-ROM 30,678 50.2 18,941 63.2
30,486 49.8 11,046 36.8
-----------------------------------------------
Total 61,164 100.0 29,987 100.0
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Gross Profit Gross profit increased 49.9% to NLG 30.5 million in the six months ended June 30, 1998 from NLG 20.4 million in the same period of 1997 of which 37.7% was attributable to DOCdata's acquisitions. As a percentage of total net sales, gross profit decreased from 32.4% to 26.9%. Excluding acquisitions, the gross profit margin 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. decreased only slightly to 31.6%. The decrease in gross profit margin resulted from the lower margins generated by the new businesses. The lower margins in the new businesses are mainly a result of the start-up costs of DOCdata Connectivity & Media and the losses of the combined California operations, primarily caused by non-availability of reliable production capacity in mastering and the development of a desirable customer base.
(In thousands, except
percentage figures) Six months ended June 30,
1998 1997
--------------------------------------------
Gross profit by
division NLG % NLG %
--------------------------------------------
Media Group
- Existing business 19,002 62.2 17,002 83.4
- New business 7,679 25.1 - -
--------------------------------------------
26,681 87.3 17,002 83.4
Automation Group 3,868 12.7 3,377 16.6
--------------------------------------------
Total 30,549 100.0 20,379 100.0
--------------------------------------------
--------------- ------------
Gross profit margin % %
--------------- ------------
Media Group
- Existing business 31.3 32.6
- New business 18.8 -
Total Media Group 26.2 32.6
Automation Group 32.8 31.5
Total 26.9 32.4
Selling, General and Administrative expenses Media Group's selling expenses comprised 6.3% of Media Group's total net sales (7.5% in the six months ended June 30, 1997). The decrease was mainly attributable to efficiencies in the UK, where a relative small sales force can cover the London London, city, Canada London, city (1991 pop. 303,165), SE Ont., Canada, on the Thames River. The site was chosen in 1792 by Governor Simcoe to be the capital of Upper Canada, but York was made capital instead. London was settled in 1826. area with a high net sales volume. Automation Group's selling expenses increased from 6.2% in the six months ended June 30, 1997 to 7.7% of total Automation Group's net sales in the six months ended June 30, 1998, primarily due to CAE's increased sales force. Media Group's general and administrative expenses increased slightly to 9.9% of Media Group's total sales in the six months ended June 30, 1998 compared to 9.7% in the same period of 1997. Automation Group's general and administrative expenses decreased from 16.5% in the six months ended June 30, 1997 to 14.3% in the same period of 1998 due to economies of scale.
(In thousands,
except percentage figures) Six months ended June 30,
1998 1997
----------------------------------------
SGA in % of net sales NLG % NLG %
----------------------------------------
Selling expenses 7,298 6.4 4,631 7.4
General and administrative
expenses 11,723 10.3 6,801 10.8
----------------------------------
Total 19,021 16.7 11,432 18.2
----------------------------------
Operating income Operating income increased by 27.7% to NLG 9.7 million in the six months ended June 30, 1998 from NLG 7.6 million in the same period of 1997. Excluding acquisitions, operating income increased by 21.6% to NLG 9.2 million. Due to acquisitions, operating income as a percentage of total net sales decreased from 12.0% to 8.5%. Operating income as a percentage of total net sales of the existing business increased to 12.7%.
(In thousands,
except percentage
figures) Six months ended June 30,
1998 1997
-------------------------------------------
Operating income
by division NLG % NLG %
---------------------------------
Media Group
- Existing business 7,937 82.1 6,626 87.6
- New business 461 4.8 - -
---------------------------------
8,398 86.9 6,626 87.6
Automation Group 1,267 13.1 941 12.4
---------------------------------
Total 9,665 100.0 7,567 100.0
---------------------------------
--------------------------
Operating income margin % %
--------------------------
Media Group
- Existing business 13.1 12.7
- New business 1.1 -
Total Media Group 8.3 12.7
Automation Group 10.7 8.8
Total 8.5 12.0
Net Financial Expenses Net financial expenses increased by 15% from NLG 1.3 million in the first half 1997 to NLG 1.5 million in the same period of 1998. The level of net financial expenses in the period under review is mainly the effect of the repayment Repayment The act of paying back a debt. Notes: Everyone has to repay their debts eventually. See also: Debt, Defeasance, Loan of the interest bearing debt following the Initial Public Offering in May 1997 and subsequently the acquisition of the businesses in the UK in August 1997, California in December 1997 and the Arcade Distribution Services in January 1998. Income Taxes The effective tax rate was 33.4% for the six months ended June 30, 1997 and 32.0% for the same period of 1997. The utilization utilization, n 1. the extent to which a given group uses a particular service in a specified period. Although usually expressed as the number of services used per year per 100 or per 1000 persons eligible for the service, utilization rates may be of net operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. carry-forwards of the Company's operating subsidiaries An operating subsidiary is a business term frequently used within the United States railroad industry. In the case of a railroad, it refers to a company that is a subsidiary but operates with its own identity and rolling stock. has resulted in lower effective tax rates for the Company than the Netherlands statutory tax rate of 35%. DOCdata France and the Automation Group have a total of approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. NLG 10.0 million in remaining net operating tax loss carry-forwards from prior periods. Liquidity and Capital Resources The Company invested NLG 7.6 million in the six months ended June 30, 1998 mainly in disc production equipment. The acquisition of the distribution activities of Arcade have been financed by short term bank facilities.
Financial Information
Condensed Consolidated Balance Sheets
----------------------------------------------------------------------
June 30, December 31,
1998 1997
----------------------------
(in thousands) (NLG) (NLG)
(Unaudited)
Assets
Current assets
Cash and cash equivalents 3,435 4,640
Trade receivables 64,301 59,866
Other receivables and
prepayments 9,644 5,198
Inventory 8,786 6,104
---------- ---------
Total current assets 86,166 75,808
---------- ---------
Fixed assets
Tangible fixed assets 85,489 85,118
Goodwill 27,781 20,942
---------- ---------
Total fixed assets 113,270 106,060
---------- ---------
Total 199,436 181,868
---------- ---------
Liabilities and shareholders'
equity
Current liabilities
Current portion of long term debt 3,231 3,326
Short term bank facilities 39,473 31,672
Trade payables 19,569 19,072
Tax and social security charges 7,990 5,475
Other liabilities 11,823 9,872
---------- ---------
Total current liabilities 82,086 69,417
Loans and mortgages 11,939 12,199
Provisions 1,676 2,423
---------- ---------
Total liabilities 95,701 84,039
Government grants 605 630
Equity
Shareholders' equity
Paid up and called up
Share capital 1,600 1,600
Share premium 68,884 68,954
Cumulative translation
adjustment 2,182 1,762
Other reserves 31,660 25,776
---------- ---------
Shareholders' equity 104,326 98,092
Minority interest (1,196) (893)
---------- ---------
103,130 97,199
---------- ---------
Total 199,436 181,868
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Condensed Consolidated Statements of Income
----------------------------------------------------------------------
Six months to end Six months ended
June 30, June 30,
1998 1997
------------------- ------------
(In thousands) (NLG) (NLG)
(Unaudited) (Unaudited)
Net sales 113,360 62,813
Cost of goods sold 82,811 42,434
------------------- ------------
Gross profit 30,549 20,379
Selling expenses 7,298 4,631
General and administrative
expenses 11,723 6,801
Amortisation expense 1,863 1,380
------------------- ------------
Operating income 9,665 7,567
Net financial expenses 1,483 1,294
Other income - 67
------------------- ------------
Income before taxes 8,182 6,340
Income taxes (2,622) (2,119)
Minority interest 303 104
------------------- ------------
Net income 5,863 4,325
Earnings per share 0.73 0.72
Average shares outstanding 8,000,000 6,000,000
---------------------------------------------------------------
Condensed Consolidated Statements of Cash Flows
----------------------------------------------------------------------
Six months ended Six months ended
June 30, 1998 June 30, 1997
------------------ ------------------
(In thousands) (NLG) (NLG)
(Unaudited) (Unaudited)
Net income 5,863 4,325
Adjustment on foreign
currency translation to
weighted average (9) (44)
Depreciation and amortisation 9,770 5,507
(Profit) loss on sale of tangible
fixed assets (14) (435)
Adjustment to reconcile net income
to net cash provided by operating
activities:
Inventory (2,682) 310
Receivables (8,881) 583
Trade payables 497 (1,459)
Taxes and social security 2,515 (1,753)
Other liabilities 1,951 (1,066)
Government grants (25) (25)
Other (1,051) (331)
Net cash provided (used) by
operating activities 7,936 5,612
Cash flows from investing activities:
Capital expenditures (7,612) (6,827)
Acquisitions (8,701) 304
Proceeds from sale of tangible
fixed assets 43 2,335
Net cash used in investing activities (16,270) (4,188)
Cash flows from financing activities:
Repayment of loans (355) (60,472)
Changes in bank overdraft 7,801 1,713
Proceeds from issuance of shares - 69,725
Other (319) (202)
Net cash provided by (used in)
financing activities 7,127 10,764
Effect of exchange rate changes on cash 2 9
Net increase (decrease) in cash and
cash equivalents (1,205) 12,197
Cash and cash equivalents at
beginning of year 4,640 1,881
Cash and cash equivalents at June 30 3,435 14,078
--------------------------------------------------------------------
Notes to Condensed con·dense v. con·densed, con·dens·ing, con·dens·es v.tr. 1. To reduce the volume or compass of. 2. To make more concise; abridge or shorten. 3. Physics a. Consolidated Financial Statements Consolidated Financial Statements The combined financial statements of a parent company and its subsidiaries. Notes: Because consolidated financial statements present an aggregated look at the financial position of a parent and its subsidiaries, they enable you to gauge 1. Preparation of Interim Financial Statements The condensed consolidated financial statements of DOCdata N.V. (referred to as "DOCdata" or the "Company") have been prepared on the basis of accounting principles generally accepted in The Netherlands together with a reconciliation to United States generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting ("US GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). ") of net income and shareholders' equity Shareholders' Equity A firms' total assets minus its total liabilities. Equivalently, it is share capital plus retained earnings minus treasury shares. Shareholders' equity is the amount by which a company is financed through common and preferred shares. . In the opinion of the management, these statements include all adjustments necessary for a fair presentation of the financial position, operating results and cash flows of all interim reporting periods herein. All such adjustments are of a normal 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. nature. The results of operations for the six months ended June 30, 1998 are not necessarily indicative indicative: see mood. of the results for the entire fiscal year ending December 31, 1998. 2. Tangible Possessing a physical form that can be touched or felt. Tangible refers to that which can be seen, weighed, measured, or apprehended by the senses. A tangible object is something that is real and substantial. An automobile is an example of tangible Personal Property. fixed assets fixed assets npl → activo sg fijo fixed assets npl → immobilisations fpl fixed assets fix npl →
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June 30, December 31,
1998 1997
------------------- ------------------
(in thousands) (NLG) (NLG)
(Unaudited)
Land and buildings 22,569 22,625
Machinery and equipment 56,192 56,777
Other 5,660 4,921
----------------------------------------
84,421 84,323
Tangible fixed assets on order 1,068 795
------------------- ------------------
Total 85,489 85,118
---------------------------------------------------------------------
3. Minority interest Minority interest represents the 45% participation in CD-One as per June 30, 1998 held by third parties. 4. Reconciliation of net income and shareholders' equity to US GAAP Application of US GAAP leads to a net income of NLG 5,295,000 and a shareholders' equity of NLG 99,182,000.
CONTACT: DOCdata N.V.
Hans van Gerwen, Chief Executive Officer,+31 73 684 7000
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