Information Holdings Reports Results for Third Quarter Ended September 30, 2004.STAMFORD Stamford, town, England Stamford, town (1991 pop. 18,127), in the Parts of Kesteven, Lincolnshire, E central England, on the Welland River. It is a market town. Products include diesel engines, electrical equipment, bricks, and tiles. , Conn. -- Information Holdings Inc. (NYSE NYSE See: New York Stock Exchange : IHI IHI Institute for Healthcare Improvement (Boston, MA, USA) IHI Ishikawajima-Harima Heavy Industries (Japan, ship building, aerospace & others) IHI Institute of History IHI I'd Hit It ) today announced results for the quarter ended September September: see month. 30, 2004. Earnings per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. common share (EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. ) from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the were $0.12 in the third quarter of 2004 compared to $0.05 in the third quarter of 2003. EPS in the third quarter of 2004 includes charges equal to approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $0.02 per share for costs associated with the pending merger with The Thomson Corporation (Thomson). Including discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. , EPS was $0.12 in the third quarter of 2004, compared to $0.06 in the third quarter of 2003. Third Quarter Results Revenues in the third quarter of 2004 increased 23.0% to $23.2 million from $18.9 million in the third quarter of 2003. Revenues in the Company's data segment (MicroPatent Micropatent is a subsidiary of the Thomson Corporation. It is the world’s leading private source for online patent and trademark information and produces the world's largest commercial collection of searchable full-text patent information. , Master Data Center and IDRAC IDRAC International Drug Regulatory Affairs Compendium ) increased 14.4% to $16.6 million, based on continued strength in the Company's patent information subscription products, patent and trademark management services and regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. database subscriptions. Software segment revenues increased 51.6% to $6.7 million due to revenues associated with CDC See Control Data, century date change and Back Orifice. CDC - Control Data Corporation Solutions (CDC), which was acquired in December December: see month. 2003. Overall software revenues were below expected levels due to a decreased volume of license deals. The Company currently expects improvement in license sales beginning in the fourth quarter of 2004, both from existing products and from the release of its new InSight Manager products. 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. for the third quarter of 2004 was 71.9%, compared to 69.0% in the comparable prior year period. The increase in gross margins is due primarily to improved gross profit margins at Liquent based on increased revenues, cost reduction initiatives and the integration of CDC. Income from operations increased $2.7 million, or 236%, to approximately $3.8 million compared to $1.1 million in the third quarter of 2003. Income from operations in the data businesses increased 45% to $5.4 million, compared to $3.8 million in the prior year period, due primarily to improved profitability in the Company's intellectual property information and management businesses. Profit improvements reflect the operating leverage Operating Leverage A measurement of the degree to which a firm or project relies on fixed rather than variable costs. Notes: The higher the degree of operating leverage, the greater the potential danger from forecasting risk. associated with increasing revenues in these units. Loss from operations in the Company's software segment decreased to $0.3 million from $1.6 million in the comparable prior year quarter. Improved operating results in this segment are due primarily to cost containment cost containment, n the features of a dental benefits program or of the administration of the program designed to reduce or eliminate certain charges to the plan. initiatives and the integration of CDC. In addition, the prior year period includes severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when charges of approximately $0.8 million. Corporate expenses reduced income from operations by $1.3 million in the third quarter of 2004 and $1.0 million in the third quarter of 2003. The Company evaluates the earnings performance of its segments based primarily on EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become (earnings before interest, taxes, depreciation and amortization Earnings before interest, taxes, depreciation and amortization (EBITDA) is a non-GAAP metric that can be used to evaluate a company's profitability.
An asset that is not physical in nature. Notes: Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. . The Company generally does not incur To become subject to and liable for; to have liabilities imposed by act or operation of law. Expenses are incurred, for example, when the legal obligation to pay them arises. An individual incurs a liability when a money judgment is rendered against him or her by a court. capital expenditures to replace intangible assets within existing operations. A reconciliation of EBITDA to income from operations before income taxes is presented after the attached financial information. Based primarily on the factors impacting revenue and income from operations discussed above, EBITDA approximated $6.0 million in the third quarter of 2004, compared to $3.9 million in the third quarter of 2003. EBITDA in the third quarter of 2004 includes non-operating expenses of $0.8 million, related to costs associated with the pending merger with Thomson, while EBITDA in the third quarter of 2003 includes severance charges of $0.8 million. EBITDA in the third quarter of 2004 for the data segment approximated $7.6 million, an increase of 29% from the comparable prior year period. EBITDA in the third quarter of 2004 for the software segment approximated $0.5 million, compared to a loss of $1.0 million in the comparable prior year period. Other EBITDA was a loss of $2.1 million in the third quarter of 2004, compared to a loss of $1.0 million in the third quarter of 2003, related to corporate operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. and merger-related charges. Commenting on the results, Mason Slaine, President & CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. said, "Our third quarter results reflect continued strong revenue and profit growth in our data businesses, while software license sales were lower than expected at Liquent. We are encouraged by market response to the impending im·pend intr.v. im·pend·ed, im·pend·ing, im·pends 1. To be about to occur: Her retirement is impending. 2. launch of Liquent's InSight Manager products and are hopeful that overall operating results will continue to improve in the fourth quarter. With respect to the pending acquisition of IHI by Thomson, our stockholders approved the merger agreement during the third quarter of 2004. As we announced previously, IHI and Thomson have received a request for additional information and documentary material from the Department of Justice (DOJ (Department Of Justice) The legal arm of the U.S. government that represents the public interest of the United States. It is headed by the Attorney General. ), following DOJ's review of the proposed acquisition of IHI by Thomson. Accordingly, the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act The Hart-Scott-Rodino Antitrust Improvements Act of 1976 (Public Law 94-435, known commonly as the HSR Act) is a set of amendments to the antitrust laws of the United States, principally the Clayton Antitrust Act. The HSR Act was signed into law by President Gerald R. of 1976 is extended and will expire expire /ex·pire/ (ek-spi´er) 1. to exhale. 2. to die. ex·pire v. 1. To breathe one's last breath; die. 2. To exhale. 30 days after substantial compliance by Thomson and IHI with this "second request", unless terminated ter·mi·nate v. ter·mi·nat·ed, ter·mi·nat·ing, ter·mi·nates v.tr. 1. To bring to an end or halt: earlier by the DOJ. Information Holdings Inc. will broadcast its third quarter earnings conference call via the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the on Friday Friday: see Sabbath; week. Friday young Indian rescued by Crusoe and kept as servant and companion. [Br. Lit.: Robinson Crusoe] See : Servant , October October: see month. 22, 2004 at 10:00 a.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 . The broadcast can be accessed through the Company's web site www.informationholdings.com. About Information Holdings Inc. Information Holdings Inc. is a leading provider of information products and services to intellectual property and life science markets. IHI's data businesses, which include MicroPatent(R), Master Data Center(TM) and IDRAC, provide a broad array of databases, information products and complementary services for intellectual property and regulatory professionals. IHI's Liquent unit is a leading provider of life science regulatory intelligence and publishing solutions. The statements in this press release that are not historical facts are 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. . Forward-looking statements are typically statements that are preceded by, followed by or include the words "believes," "plans," "intends," "will," "expects," "anticipates," or similar expressions. Actual results may differ materially from the results predicted, and reported results should not be considered as an indication of future performance. These forward-looking statements involve risks and uncertainties that could render (1) To make visible; to draw. The term comes from the graphics world where a rendering is an artist's drawing of what a new structure would look like. In computer-aided design (CAD), a rendering is a particular view of a 3D model that has been converted into a realistic image. them materially different. More information about factors that could potentially affect IHI's financial results is included in IHI's filings with the SEC, including its Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ended December 31, 2003. The forward-looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. information in this release reflects management's judgment only on the date of this press release.
Information Holdings Inc.
Consolidated Statements of Operations
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
------------------ ------------------
(in thousands, except per share
data) 2004 2003 2004 2003
-------- --------- -------- ---------
Revenues:
Product $13,055 $11,466 $41,214 $35,372
Service 10,226 7,456 29,747 22,962
-------- --------- -------- ---------
Total revenues 23,281 18,922 70,961 58,334
-------- --------- -------- ---------
Cost of sales:
Product 3,119 2,885 9,521 8,948
Service 3,412 2,988 10,449 9,680
-------- --------- -------- ---------
Total cost of sales 6,531 5,873 19,970 18,628
-------- --------- -------- ---------
Gross profit 16,750 13,049 50,991 39,706
-------- --------- -------- ---------
Operating expenses:
Selling, general and
administrative 10,088 9,194 31,111 27,234
Depreciation and amortization 2,839 2,719 8,876 8,073
-------- --------- -------- ---------
Total operating expenses 12,927 11,913 39,987 35,307
-------- --------- -------- ---------
Income from operations 3,823 1,136 11,004 4,399
-------- --------- -------- ---------
Other income (expense):
Interest income, net 792 519 2,367 1,327
Costs associated with pending
merger (778) - (1,368) -
Early termination of credit
agreement - - - (575)
Other income (expense), net 3 (3) 321 (3)
-------- --------- -------- ---------
Income from continuing operations
before income taxes 3,840 1,652 12,324 5,148
Provision for income taxes 1,389 603 4,360 1,833
-------- --------- -------- ---------
Income from continuing operations 2,451 1,049 7,964 3,315
Income (loss) from discontinued
operations,
net of income taxes - 103 (1,361) 29,703
-------- --------- -------- ---------
Net income $2,451 $1,152 $6,603 $33,018
======== ========= ======== =========
Net income (loss) per basic
common share:
Continuing operations $0.12 $0.05 $0.38 $0.16
Discontinued operations 0.00 0.00 (0.07) 1.40
-------- --------- -------- ---------
Net income $0.12 $0.06 $0.32 $1.56
======== ========= ======== =========
Net income (loss) per diluted
common share:
Continuing operations $0.12 $0.05 $0.38 $0.16
Discontinued operations 0.00 0.00 (0.06) 1.40
-------- --------- -------- ---------
Net income $0.12 $0.06 $0.31 $1.56
======== ========= ======== =========
Information Holdings Inc.
Consolidated Balance Sheets
(in thousands)
September 30, December 31,
2004 2003
------------- -------------
Assets (Unaudited)
Current assets:
Cash and cash equivalents $ 58,805 $ 39,693
Short-term investments 9,281 12,271
Restricted cash - 3,000
Accounts receivable, net 35,651 37,650
Prepaid expenses and other current assets 4,922 5,669
Income taxes receivable 202 11,899
Deferred income taxes 2,001 2,001
------------ ------------
Total current assets 110,862 112,183
Investments 86,071 83,207
Property and equipment, net 3,952 4,281
Identified intangible assets, net 65,320 70,248
Goodwill 99,699 100,871
Other assets 5,839 3,880
------------ ------------
Total assets $ 371,743 $ 374,670
============ ============
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $ 32,105 $ 32,073
Accrued expenses 13,290 18,124
Deferred revenue 22,302 25,753
------------ ------------
Total current liabilities 67,697 75,950
Long-term deferred income taxes 14,789 16,307
------------ ------------
Total liabilities 82,486 92,257
------------ ------------
Stockholders' equity:
Preferred stock $ - $ -
Common stock 219 219
Additional paid-in capital 248,966 247,964
Retained earnings 44,907 38,304
Treasury stock, at cost (14,723) (14,723)
Accumulated other comprehensive income 9,888 10,649
------------ ------------
Total stockholders' equity 289,257 282,413
------------ ------------
Total liabilities and stockholders' equity $ 371,743 $ 374,670
============ ============
Information Holdings Inc.
Reconciliation of Segment Income (loss) from continuing operations
before income taxes to EBITDA
Three Months Nine Months Ended
Ended September 30,
September 30,
---------------- -----------------
(in thousands) 2004 2003 2004 2003
-------- ------- -------- --------
Data Segment
Income from continuing operations
before income taxes $5,480 $3,763 $14,657 $10,857
Amortization of capitalized
software - 2 1 11
Depreciation 601 719 2,064 2,062
Amortization of intangible assets 1,535 1,414 4,632 4,247
Interest income, net (61) (21) (151) (140)
-------- ------- -------- --------
EBITDA 7,555 5,877 21,203 17,037
Software Segment
(Loss) income from continuing
operations before income taxes (288) (1,622) 753 (2,471)
Amortization of capitalized
software 75 42 224 118
Depreciation 225 299 734 881
Amortization of intangible assets 475 282 1,434 849
Interest (income) expense, net (5) 4 (11) 11
-------- ------- -------- --------
EBITDA 482 (995) 3,134 (612)
Other
Loss from continuing operations
before income taxes (1,352) (489) (3,086) (3,238)
Depreciation 3 5 12 34
Interest income, net (726) (502) (2,205) (1,198)
-------- ------- -------- --------
EBITDA (2,075) (986) (5,279) (4,402)
Consolidated
Income from continuing operations
before income taxes 3,840 1,652 12,324 5,148
Amortization of capitalized
software 75 44 225 129
Depreciation 829 1,023 2,810 2,977
Amortization of intangible assets 2,010 1,696 6,066 5,096
Interest income, net (792) (519) (2,367) (1,327)
-------- ------- -------- --------
EBITDA $5,962 $3,896 $19,058 $12,023
======== ======= ======== ========
|
|
||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion