Digital Processing Announces Strong Third Quarter Results.MARKHAM Markham City (pop., 1991: 154,000), southeastern Ontario. It is situated on the Rouge River, northeast of Toronto. Settled in 1794, the town was named for William Markham, archbishop of York. It annexed the nearby township of Markham in 1971. , Ontario--(BUSINESS WIRE)--Nov. 6, 1996-- Digital Processing Digital processing is the process of altering digital data in any form. The most common situations where digital processing is involved are computer graphics and digital audio processing. S(TSE See Tokyo Stock Exchange. TSE 1. See Tokyo Stock Exchange (TSE). 2. See Toronto Stock Exchange (TSE). DPS Minicomputer series from Bull HN. 1. (language, text) DPS - Display PostScript. 2. (language) DPS - A real-time language with direct expression of timing requests. ["Language Constructs for Distributed Real-Time PRogramming", I. . ) Digital Processing Systems Inc. today announced that consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: revenue for the third quarter ended September September: see month. 30, 1996 increased by 23 percent to $9,460,000, from $7,675,000 in the same period of 1995. Net earnings for the period increased 27 percent to $1,302,000. Earnings per share (basic) were 11 cents, unchanged from 1995 despite an increase in weighted average number of shares outstanding to 12.3 million from 9.4 million. DPS continues to achieve revenue growth in all geographic geographic /geo·graph·ic/ (je?o-graf´ik) in pathology, of or referring to a pattern that is well demarcated, resembling outlines on a map. geographic pertaining to geography. regions, with particularly strong gains in the Pacific Rim Pacific Rim, term used to describe the nations bordering the Pacific Ocean and the island countries situated in it. In the post–World War II era, the Pacific Rim has become an increasingly important and interconnected economic region. . DPS Asia/Pacific continues to expand its distribution network, contributing to a 370 percent sales increase in the region from 1995. Sales in 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. were also healthy with a 22 percent advance. European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. sales were seasonally low in the third quarter, consistent with prior years. The year-over-year revenue increase in the third quarter was less than during the first six months because the third quarter of 1995 reflected the first shipments of the Perception Video Recorder See DVR, DVD-R and DVD drives. , one of the cornerstone cornerstone Ceremonial building block, dated or otherwise inscribed, usually placed in an outer wall of a building to commemorate its dedication. Often the stone is hollowed out to contain newspapers, photographs, or other documents reflecting current customs, with a view to products of the Company. Gross margins and pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta profit ratio were maintained, while investment in research and development activities increased to 8.2 percent of sales, up from 4.6 percent in 1995. Having fallen behind in 1995, R and D expenditures have now returned to an appropriate level. For the nine months, consolidated revenue was $28,829,000, 35 percent ahead of the $21,302,000 reported in 1995. Net income increased 26 percent to $3,809,000, or 36 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. (basic), from $2,594,000 (32 cents per share) in the first nine months of 1995. The Company is now in an intense period of product introductions. Two of the four major new products scheduled for launch in 1996 are now being shipped to customers. These new products are the Video Effects See digital video effects. Accelerator accelerator: see particle accelerator. (1) A key combination such as Alt-G or Ctrl-Shift H that is used to activate a task. (2) An incubator that expects to develop the company considerably faster than normal. See incubator. (the first DPS offering in the Video Effects field) and the DPS 465 (DPS' first all-digital Studio product). First shipment of two additional products are planned for the fourth quarter. In mid-October n. 1. the middle part of October. Noun 1. mid-October - the middle part of October period, period of time, time period - an amount of time; "a time period of 30 years"; "hastened the period of time of his recovery"; "Picasso's blue period" 1996, the Company moved into a new 52,000 square foot manufacturing and head office building in Markham, just north of Toronto Toronto (tərŏn`tō), city (1998 est pop. 2,400,000), provincial capital, S Ont., Canada, on Lake Ontario. Toronto is the largest city in Canada and since the 1970s has been one of the fastest-changing cities in North America, experiencing . In connection with this move, the Company negotiated a release from its remaining commitment to the former leased premises premises n. 1) in real estate, land and the improvements on it, a building, store, shop, apartment, or other designated structure. The exact premises may be important in determining if an outbuilding (shed, cabana, detached garage) is insured or whether a person . The settlement resulted in DPS reporting a reduction in reserves of $150,000 in the third quarter. DPS had provided a $227,000 reserve in the second quarter. Digital Processing Systems is a leading designer and manufacturer of electronic hardware and related software used for creating, editing and processing broadcast-quality video and audio material. The Company's products are used throughout the world by the computer-based desktop video production industry, television broadcasters, and by video production and post-production Post-production occurs in the making of audio recordings, films/movies, photography and digital art, videos and television programs. It is the general term for all stages of production occurring after the actual recording and ending with the completed work. studios. -0-
DIGITAL PROCESSING SYSTEMS INC.
CONSOLIDATED STATEMENTS OF INCOME AND RETAINED EARNINGS
(unaudited)
For the three months For the nine months
ended September 30 ended September 30
------------------------------------------
1996 1995 1996 1995
Revenue $9,459,803 $7,675,308 $28,828,868 $21,301,636
Cost of sales 4,468,516 3,578,319 13,612,868 10,118,277
------------------------------------------------
Gross profit 4,991,287 4,096,989 15,216,000 11,183,359
Interest income 200,222 14,419 237,742 40,478
Expenses
Marketing 1,637,420 1,543,269 4,200,336 3,389,476
Administration 606,090 541,854 2,810,619 1,959,571
Research and 773,643 354,966 2,201,925 914,721
development
-----------------------------------------------
3,017,153 2,440,089 9,212,880 6,263,768
-----------------------------------------------
Income before
income taxes 2,174,356 1,671,319 6,240,862 4,960,069
Income taxes 872,413 648,449 2,431,776 1,934,427
-----------------------------------------------
Net income for
the period 1,301,943 1,022,870 3,809,086 3,025,642
Retained earnings,
beginning of
period 6,107,292 4,597,254 3,600,149 2,594,482
-----------------------------------------------
Retained earnings,
end of period 7,409,235 5,620,124 7,409,235 5,620,124
-----------------------------------------------
Basic earnings
per share (Note) 0.11 0.11 0.36 0.32
Weighted average
number of
shares
outstanding 12,288,560 9,375,000 10,590,627 9,375,000
Fully diluted
earnings per
share (Note) 0.10 0.11 0.33 0.32
Fully diluted
number of
shares
outstanding 13,074,833 9,375,000 13,074,833 9,375,000
Note
The weighted average number of shares by the end of 1996 are
anticipated to be 11,059,020.
Dilutive factors include a compensation option for 162,333 common
shares provided to the underwriters of the Company's initial public
offering and stock options for 490,000 common shares issued to
employees and directors. Earnings of $48,000 for the three months
and $483,000 for the nine months ended September 30, 1996 have been
imputed on these dilutive factors using a rate of return of 4.75
percent.
DIGITAL PROCESSING SYSTEMS INC.
CONSOLIDATED STATEMENTS OF CHANGES IN FINANCIAL POSITION
(unaudited)
For the three months ended
September 30
1996 1995
------ ------
Cash provided by (used in)
Operating activities
Net income for the period $ 1,301,943 $ 1,022,870
Amortization 130,893 112,638
Increase in non-cash working
capital balances (1,016,123) 642,984
----------- -----------
416,713 1,778,492
Financing activities
Issuance of capital stock,
net of issuance costs 3,008,557 --
Advances from (to)
shareholders, net 207,785 (3,302,474)
Proceeds from long-term
debt, net 28,098 (19,545)
Dividends paid (1,428,670) --
----------- -----------
1,815,770 (3,322,019)
Investing activity
Capital asset additions (1,547,743) (134,910)
Investment in affiliated
company -- (116,840)
----------- -----------
(1,547,743) (251,750)
----------- -----------
Increase (decrease) in cash
during the period 684,740 (1,795,277)
Cash and short-term investments,
beginning of period 16,161,644 2,085,447
----------- -----------
Cash and short-term investments,
end of period $16,846,384 $ 290,170
----------- -----------
----------- -----------
For the nine months ended
September 30
1996 1995
------ ------
Cash provided by (used in)
Operating activities
Net income for the period $ 3,809,086 $ 3,025,642
Amortization 311,496 242,130
Increase in non-cash working
capital balances (5,357,250) (2,033,552)
----------- -----------
(1,236,668) 1,234,220
Financing activities
Issuance of capital stock,
net of issuance costs 23,578,746 --
Advances from (to)
shareholders, net 940,687 (1,085,549)
Proceeds from long-term
debt, net 162,634 56,055
Dividends paid (3,007,000) --
----------- -----------
21,675,067 (1,029,494)
Investing activity
Capital asset additions (4,346,893) (605,601)
Investment in affiliated
company -- (116,840)
----------- -----------
(4,346,893) (722,441)
----------- -----------
Increase (decrease) in cash
during the period 16,091,506 (517,715)
Cash and short-term investments,
beginning of period 754,878 807,885
----------- -----------
Cash and short-term investments,
end of period $16,846,384 $ 290,170
----------- -----------
----------- -----------
DIGITAL PROCESSING SYSTEMS INC.
CONSOLIDATED BALANCE SHEETS
(unaudited)
September 30
--------------------------
1996 1995
------------ ------------
Assets
Current assets
Cash and short-term investments $ 16,846,384 $ 290,170
Accounts receivable 4,283,201 3,728,025
Inventories 8,263,705 5,927,044
Deferred income taxes 247,600 -
Other assets 779,466 1,310,550
------------ ------------
30,420,356 11,255,789
Investment in affiliated company 116,840 116,840
Deferred income taxes 654,607 -
Capital assets 5,183,296 1,061,215
------------ ------------
$ 36,375,099 $ 12,433,844
------------ ------------
------------ ------------
Liabilities
Current liabilities
Accounts payable and
accrued liabilities $ 3,953,100 $ 5,857,799
Income taxes payable 279,880 747,554
------------ ------------
4,232,980 6,605,353
Long-term liabilities 288,538 207,767
Shareholders' equity
Capital stock 24,444,346 600
Retained earnings 7,409,235 5,620,124
------------ ------------
31,853,581 5,620,724
------------ ------------
$ 36,375,099 $ 12,433,844
------------ ------------
------------ ------------
CONTACT: Digital Processing Systems Inc. Dr. Keith Lucas Keith Lucas FRS (8 March 1879 - 5 October 1916) was a British scientist who worked at Trinity College, Cambridge doing pioneering work in Neuroscience. He was elected a Fellow of the Royal Society in 1913. He was the son of Francis Robert Lucas and K. Lucas. , 905/ 944-4004 or Digital Processing Systems Inc. Ken MacKenzie Mackenzie, river, c.1,120 mi (1,800 km) long, issuing from Great Slave Lake, Northwest Territories, Canada, and flowing generally NW to the Arctic Ocean through a great delta. Between Great Slave Lake and Lake Athabasca it is known as the Slave River. , 905/ 944-4005 |
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