Datatec Systems Reports Record Q3 FY2003 Sales of $35.3 Million and EPS of $0.01; Delivers First Ever Third Quarter Sequential Sales Growth and Profitability.Business Editors FAIRFIELD Fairfield. 1 City (1990 pop. 12,200), Jefferson co., N central Ala., an industrial suburb of Birmingham; inc. 1919. Founded (1910) by the United States Steel Corp., its steel industry has greatly declined, negatively affecting the city's economy. , N.J.--(BUSINESS WIRE)--March 17, 2003 Datatec Systems, Inc. (Nasdaq: DATC DATC Davis Applied Technology College (Kaysville, Utah) DATC Days After Test Completion DATC Deferred Adverse Tax Consequence DATC Direct Assistance & Training Command DATC Director of Air Traffic Control ), a leading provider of technology deployment Installing, setting up, testing and running. This military term, which means the placement of troops and equipment in the field, is widely used with computers as an alternate to the word "implementation. services and software tools, today reported results for the third quarter of fiscal 2003 ended January January: see month. 31, 2003. Highlights of the report are: -- Q3 FY2003 sales at $35.3 million were the highest quarterly revenues in Datatec history, representing an increase of 118% versus the same quarter last year and 6% higher than the previous record quarter of Q2 FY2003. -- Net Income was $201,000 or $0.01 per share, compared to a net loss of $2.01 million or ($0.06) per share in the same period last year and a net income of $1.6 million or $0.05 per share in the prior quarter. -- As a percentage of sales, Selling, General and Administrative expenses were 16.5% for the three months ended January 31, 2003 compared to 33% for the same period last year and 15.7% in the prior quarter. -- Trailing 12-month revenues of $113 million for the period ending January 31, 2003 were the highest sequential 12-month revenues in Datatec history. -- The 12-month backlog as at March 14, 2003 stood at a record $81.1 million, with a total pipeline of $197 million. Commenting on the results, Isaac Gaon Gaon may refer to
Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. were $6.4 million with a net profit of $3.1 million or the equivalent of 9 cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. . These are huge achievements especially when one considers the brutally hostile economic environment in which we are working." Datatec will discuss its second quarter results in an investor conference call today, March 17, 2003 at 4:30 p.m. Eastern Time. Conference call details are: US & Canada Toll Free 877-601-3547 International 712-257-3321 Password Third Quarter Conference Leader Bob Engelberg About Datatec Systems, Inc. Fairfield, NJ-based Datatec Systems specializes in the rapid, 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. market absorption absorption [Lat.,=sucking from], taking of molecules of one substance directly into another substance. It is contrasted with adsorption, in which the molecules adhere only to the surface of the second substance. of networking technologies. Datatec's deployment services utilize a software-enabled implementation model to configure See configuration. (software) configure - A program by Richard Stallman to discover properties of the current platform and to set up make to compile and install gcc. Cygnus configure was a similar system developed by K. , integrate and roll out new technology solutions using a "best practices" structured process. Its customers include Fortune 1000 companies and world-class world-class adj. 1. Ranking among the foremost in the world; of an international standard of excellence; of the highest order: a world-class figure skater. 2. technology providers. Datatec stock is listed on the Nasdaq Stock Market Nasdaq stock market The first electronic stock market listing over 5000 companies. The Nasdaq stock market comprises two separate markets, namely the Nasdaq National Market, which trades large, active securities and the Nasdaq Smallcap Market that trades emerging growth companies. (DATC). For more information, visit http://www.datatec.com/ This Press Release contains 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. within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements involve risks and uncertainties that may cause the actual results or objectives to be materially different from those expressed or implied Inferred from circumstances; known indirectly. In its legal application, the term implied is used in contrast with express, where the intention regarding the subject matter is explicitly and directly indicated. by such forward-looking statements.
DATATEC SYSTEMS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS EXCEPT FOR SHARE AND PER SHARE AMOUNTS)
(unaudited)
For The Three Months For The Nine Months
Ended January 31, Ended January 31,
2002 2003 2002 2003
(As (As
Restated) Restated)
----------------------------------------------
Revenue $16,237 $35,275 $53,898 $91,550
Cost of revenue 12,409 28,266 37,815 70,257
------ ------ ------ ------
Gross profit 3,828 7,009 16,083 21,293
Selling, general and
administrative
expenses 5,366 5,807 17,500 16,072
------ ----- ------ -------
Operating income
(loss) (1,538) 1,202 (1,417) 5,221
Interest expense 475 1,001 1,525 2,671
------ ----- ------- -------
Income (loss) before
minority interest (2,013) 201 (2,942) 2,550
Minority interest - - 318 -
-------- ------- ------- -------
Net income (loss) $(2,013) $201 $(3,260) $2,550
Earnings (loss) per
common share -
Basic $(0.06) $0.01 $(0.09) $0.07
Diluted $(0.06) $0.01 $(0.09) $0.07
Weighted average
common shares
outstanding -
Basic 35,226,000 36,168,000 34,919,000 35,878,000
Diluted 35,226,000 36,604,000 34,919,000 36,101,000
CONDENSED CONSOLIDATED STATEMENTS OF
COMPREHENSIVE INCOME (LOSS)
(IN THOUSANDS)
(unaudited)
For The Three Months For The Nine Months
Ended January 31, Ended January 31,
2002 2003 2002 2003
(As (As
Restated) Restated)
--------------------------------------------
Net income (loss) $(2,013) $201 $(3,260) $2,550
Other comprehensive
income (loss) -
Foreign currency
translation adjustment 1 1 5 (1)
Comprehensive income
(loss) $(2,012) $202 $(3,255) $2,549
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
(unaudited)
April 30, January 31,
2002 2003
-----------------------
ASSETS
-------
Current Assets:
Cash and cash equivalents $49 $155
Accounts receivable, net 14,578 30,980
Costs and estimated earnings in excess
of billings 7,224 16,821
Inventory 3,176 2,814
Prepaid expenses and other current assets 725 1,042
-----------------------
Total current assets 25,752 51,812
Property and equipment, net 3,259 3,713
Goodwill, net 2,665 2,665
Other assets 4,170 3,097
-----------------------
TOTAL ASSETS $35,846 $61,287
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
Current Liabilities:
Short-term borrowings $17,464 $22,811
Current portion of long-term debt 42 9
Accounts payable 7,789 16,286
Accrued expenses and other liabilities 3,631 4,619
Billings in excess of costs and estimated
earnings 69 7,393
Subordinated Secured Convertible
Debentures, net of unamortized discount - 1,806
-------------------------
Total current liabilities 28,995 52,924
Long-term debt:
Notes payable 1,414 1,414
Capital lease obligation 2 -
Subordinated Secured Convertible
Debentures, net of unamortized
discount 1,457 -
-------------------------
Total long-term debt 2,873 1,414
Stockholders' equity:
Common stock, $0.001 par value
(authorized 75,000,000 shares;
issued and outstanding 35,591,000
shares and 36,344,000 shares as of
April 30, 2002 and January 31, 2003,
respectively) 35 36
Additional paid-in capital 53,532 53,953
Accumulated deficit (49,239) (46,689)
Accumulated other comprehensive loss (350) (351)
--------------------------
Total stockholders' equity 3,978 6,949
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $35,846 $61,287
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