MKS Announces Record Second Quarter Results.WATERLOO, Ontario Coordinates: Waterloo is a city in Ontario, Canada. It is the smallest of the three cities in the Regional Municipality of Waterloo, and is adjacent to the larger city of Kitchener. -- MKS (Mortice Kern Systems Inc., Waterloo, Ontario, www.mks.com) A software company that specializes in programming tools and utilities for a variety of platforms. For example, its RCS system for Windows, OS/2 and Unix is a version control software package. Inc. (MKS) (TSX TSX Toronto Stock Exchange (TSE before April, 2002) TSX Transfer from Stack Pointer to Index TSX True Space Extension :MKX MKX Mortal Kombat Extreme ) today announced its financial results for the second quarter of fiscal 2006 which ended on October October: see month. 31, 2005. All amounts are reported in US dollars under 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. 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 . Highlights for the quarter included: - Comparing Q2 fiscal 2006 to Q2 fiscal 2005: - 23 percent increase in total revenue, from $9.4 million to $11.5 million - Increased net income from $0.2 million or $0.00 per share to $0.9 million or $0.02 per share - 31 percent growth in application lifecycle management The administration and control of an application from inception to its demise. It embraces requirements management, system design, software development and configuration management and implies an integrated set of tools for developing and controlling the project. (ALM) revenues from $7.3 million to $9.6 million - $0.6 million improvement in ALM profit from a loss of ($0.2) million to $0.4 million. "We were pleased to deliver a quarter that was right on track with continued license growth, outstanding services performance and steady maintenance revenue gains," said Philip C. Deck, 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. of MKS. "We were particularly gratified grat·i·fy tr.v. grat·i·fied, grat·i·fy·ing, grat·i·fies 1. To please or satisfy: His achievement gratified his father. See Synonyms at please. 2. by the substantial increase in profitability and cash flow this quarter, delivered without the reliance on any large license transactions and given the Company's continued significant investments in growth." - Significant customer wins at Automatic Data Processing Same as data processing. (ADP (1) (Automatic Data Processing) Synonymous with data processing (DP), electronic data processing (EDP) and information processing. (2) (Automatic Data Processing, Inc., Roseland, NJ, www.adp. ) Inc.; Axalto N.V.; BearingPoint Inc.; Continental Automotive Systems Continental Automotive Systems (CAS), founded in 1906 by Alfred Teves, a division of Continental AG, is a leading brake and electronics supplier to the automotive industry, delivering systems, components, electronics, lithium-ion batteries and engineering services for vehicle ; The Centers for Medicare Medicare, national health insurance program in the United States for persons aged 65 and over and the disabled. It was established in 1965 with passage of the Social Security Amendments and is now run by the Centers for Medicare and Medicaid Services. & Medicaid Medicaid, national health insurance program in the United States for low-income persons; established in 1965 with passage of the Social Security Amendments and now run by the Centers for Medicare and Medicaid Services. ; Deutsche Lufthansa AG; Federal Aviation Administration Federal Aviation Administration (FAA), component of the U.S. Department of Transportation that sets standards for the air-worthiness of all civilian aircraft, inspects and licenses them, and regulates civilian and military air traffic through its air traffic control ; NCR Corporation (company) NCR Corporation - Electronics company mainly active in the midrange server market. NCR was founded 1884 as National Cash Register Company. It joint the computer industry in th 1950s. ; The Neiman Marcus Neiman Marcus U.S. department-store chain. It was founded in Dallas, Texas, in 1907 by Herbert Marcus, his sister Carrie Marcus Neiman, and her husband, A.L. Neiman. Group Inc.; Royal Bank Financial Group; Tele Atlas  This article or section is written like an .Please help [ rewrite this article] from a neutral point of view. Mark blatant advertising for , using . N.V.; Volkswagen AG Volkswagen AG (VW) Major German automobile manufacturer. It was founded in 1937 to mass-produce a low-priced “people's car” (Volkswagen). After World War II the company was rebuilt with Allied help, and within a decade it was producing half of West Germany's ; and Wincor Nixdorf Wincor Nixdorf (FWB: WIN) is a corporation that provides retail and retail banking hardware, software, and services. Wincor Nixdorf is engaged primarily in the sale, manufacture, installation and service of self-service transaction systems (such as ATMs), retail banking equipment International GmbH. - 19 contracts worth greater than $100,000 vs. 17 in the same period last year - 94 percent growth in ALM service revenue over the second quarter of fiscal 2005. - MKS Integrity Suite(R) acclaimed ac·claim v. ac·claimed, ac·claim·ing, ac·claims v.tr. 1. To praise enthusiastically and often publicly; applaud. See Synonyms at praise. 2. by UK analyst firm Butler Group as "powerful and enterprise strength." - Partnership with RCM RCM Reliability-Centered Maintenance RCM Royal College of Music RCM Royal Conservatory of Music RCM Royal Canadian Mint RCM Reliability Centered Maintenance RCM Revenue Cycle Management RCM Regional Climate Model RCM Ring-Closing Metathesis Technologies providing access to deep consulting, implementation and process expertise across the United States, along with new partnerships with Anexinet Corporation, ARTiSAN Software, DCDP Ltd., Highbury Solutions, iTKO Inc., Objects Logic, Parasoft Corporation, Phoenix Business, ProxyCo, Utopia Solutions and Systems Process Inc. "Our attention continues to be focused at building on our outstanding win rate and record of successful deployments through aggressive field force expansion" said Michael Harris Mike Harris or Michael Harris may refer to:
Management Changes Today MKS announced changes to its management organization. Michael W. Harris has been promoted to President, in addition to his longstanding role as Chief Operating Officer Chief Operating Officer (COO) The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. . All employees of MKS will now report through Mr. Harris in this expanded capacity. Mr. Harris will continue to report to Philip C. Deck, Chairman and CEO, whose role and title remains unchanged. Douglas Sawatzky, Vice President Finance has been promoted to Chief Financial Officer. Robert Dietrich, formerly CFO See Chief Financial Officer. , is leaving the company. "Today's management changes reflect the entire board's continued appreciation and confidence in Michael's role in the success of MKS. With our continued profitable growth, we continue to evolve the structure of our organization towards better execution, organizational scalability and governance Governance makes decisions that define expectations, grant power, or verify performance. It consists either of a separate process or of a specific part of management or leadership processes. Sometimes people set up a government to administer these processes and systems. ," said Philip C. Deck. "I would like to congratulate Michael and Doug on their expanded responsibilities and to thank Rob for his tireless efforts and significant role in the rebuilding of MKS over the past 4 years." Financial Review Total revenue for the second quarter of fiscal 2006 was $11.5 million, a 23 percent or $2.1 million increase from $9.4 million in the second quarter of fiscal 2005. Net income for the second quarter of fiscal 2006 was $0.9 million, or $0.02 per share, an improvement of 356 per cent or $0.7 million compared to net income of $0.2 million or $0.00 per share in the second quarter of fiscal 2005. Six month revenue for fiscal 2006 was $22.3 million, a 22 percent or $4.1 million increase from $18.2 million for the same period in fiscal 2006. Six month net income was $1.5 million, up $1.1 million, or $0.03 per share, from the net income of $0.4 million, or $0.01 per share, reported in the same period of fiscal 2005. Second quarter fiscal 2006 ALM revenues were $9.6 million, representing 31 percent growth over ALM revenues of $7.3 million in the second quarter of fiscal 2005. The Company's cash position increased to $10.5 million from $8.9 million during the quarter. Outlook MKS expects that the trend of revenue growth will continue throughout fiscal 2006 by developing ALM licensing opportunities through expansion of existing customer relationships and through targeting of Global 1000 companies in its primary markets worldwide. MKS believes that the positive results in Q2 06 and the anticipated growth in ALM revenue in the balance of fiscal 2006 will lead to annual fiscal 2006 revenue in the range of $47 to $51 million, (increased from our expectation of a range of $46 to $51 million announced last quarter), and income from operations before tax in the range of $3 to $4 million (unchanged from our expectation last quarter). Factors to be considered in arriving at these ranges, identified in the April 30, 2005 MD&A, yet still relevant as of October 31, 2005, include: the intention of MKS to expand its sales and services staff, increased marketing expenditures and increased ALM research and development expenditures to ensure MKS maintains its technical leadership in the ALM market and the expectation that MKS's Interoperability The capability of two or more hardware devices or two or more software routines to work harmoniously together. For example, in an Ethernet network, display adapters, hubs, switches and routers from different vendors must conform to the Ethernet standard and interoperate with each other. business will decline 5 to 10 percent over the course of the year. Conference Call Details Interested parties may access the call by dialing 877-871-9526 or 416-620-2400. A digital recording of the call will be available for one (1) week, from November 30, 2005 to December 07, 2005, and may be accessed by dialing 800-558-5253 or 416-626-4100 and by entering reservation #21268923. About MKS MKS is the premier provider of application lifecycle management solutions for the global 1000. MKS's solution spans from requirements management The administration and control of the information needs of users. In order to achieve business objectives within an organization via information systems, user requirements must be defined in a consistent manner, prioritized and monitored. to deployment providing customers with enhanced development productivity, visibility over processes, and improved IT controls for regulatory compliance. MKS's software is distinguished by its single architecture and deep integration of features delivering collaboration Working together on a project. See collaborative software. throughout the development lifecycle, rapid implementation and low total cost of ownership. Founded in 1984, MKS serves more than 10,000 customers in countries across the world. Whether through deployment of MKS's solution strategically on an enterprise scale, or by leveraging individual components to solve project-level challenges, our customers can use MKS's software to enable higher levels of process maturity, better manage global development activity and safeguard their most critical business applications and software assets. Under its widely known MKS Toolkit MKS Toolkit is a software package produced and maintained by MKS Inc. that provides a Unix environment for scripting, connectivity and porting Unix and Linux software to both 32- and 64-bit Microsoft Windows systems. brand, MKS also provides UNIX-Windows co-existence and system administration that significantly cut development and administrative costs administrative costs, n.pl the overhead expenses incurred in the operation of a dental benefits program, excluding costs of dental services provided. and reduce time to market, while enabling enhanced performance. More information about MKS can be found at http://www.mks.com, or by calling 1-800-265-2797 (US & Canada), +49-711-351775-0 (Germany), +44-1483-733900 (United Kingdom) and 1-519-884-2251 (Rest of World). Copyright (C) 2005 MKS Inc. MKS, MKS Integrity Suite, and MKS Toolkit are trademarks or registered trademarks of MKS Inc. All other trademarks mentioned in this release are the property of their respective owners. This news 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. that involve risks and uncertainties, which may cause actual results to differ materially from the statements made. When used in this document, the words "may", "would", "could", "will", "intend", "plan", "anticipate", "believe", "estimate", "expect" and similar expressions are intended to identify forward-looking statements. Such statements reflect the Company's current views with respect to future events and are subject to such risks and uncertainties. Although the Company believes the expectations represented by such forward looking statements are reasonable, there can be no assurance that those expectations will prove to be correct. Many factors could cause our actual results to differ materially from the statements made including those factors detailed from time to time in filings made by the Company with Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. securities regulatory authorities Noun 1. regulatory authority - a governmental agency that regulates businesses in the public interest regulatory agency administrative body, administrative unit - a unit with administrative responsibilities . Should one or more of these risks or uncertainties materialize ma·te·ri·al·ize v. ma·te·ri·al·ized, ma·te·ri·al·iz·ing, ma·te·ri·al·iz·es v.tr. 1. To cause to become real or actual: By building the house, we materialized a dream. , or should assumptions underlying the forward looking statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated or expected. The Company does not intend and does not assume any obligation to update these forward-looking statements.
MKS Inc.
Consolidated Balance Sheets
(Dollar Amounts In US, In Thousands, Unaudited)
(Audited)
October 31 April 30
2005 2005
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Assets:
Current assets:
Cash and cash equivalents $ 10,485 $ 7,799
Accounts receivable, net of
allowances for doubtful accounts
of $157 (April 30, 2005 - $148) 7,418 8,126
Other 2,245 2,039
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Total current assets 20,148 17,964
Fixed assets 3,445 3,250
Intangibles and goodwill 2,424 2,426
Other - 395
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Total assets $ 26,017 $ 24,035
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Liabilities and shareholders' equity:
Current liabilities:
Accounts payable $ 1,703 $ 1,753
Accrued liabilities 2,804 3,455
Income taxes payable 389 320
Deferred revenue 9,349 9,704
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Total current liabilities 14,245 15,232
Long-term liabilities:
Deferred revenue 178 149
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Total liabilities 14,423 15,381
Shareholders' equity:
Share capital 49,258 47,933
Accumulated other comprehensive loss (1,192) (1,332)
Accumulated deficit (36,472) (37,947)
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Total shareholders' equity 11,594 8,654
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Total liabilities and shareholders'
equity $ 26,017 $ 24,035
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MKS Inc.
Consolidated Statements of Operations
(Dollar Amounts in US, In Thousands,
Except Per Share Data, Unaudited)
Three Months Ended Six months Ended
October 31 October 31
2005 2004 2005 2004
---- ---- ---- ----
Revenue:
License $ 5,431 $ 4,790 $ 10,676 $ 9,246
Maintenance 4,704 3,868 9,059 7,481
Service 1,401 747 2,606 1,518
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Total revenue 11,536 9,405 22,341 18,245
Operating expenses:
Cost of product and
support 888 774 1,738 1,557
Cost of service 979 606 2,003 1,169
Sales and marketing 4,735 4,291 9,383 8,239
Research and development 2,312 2,070 4,522 4,123
General and administrative 1,722 1,463 3,279 2,779
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Total operating expenses 10,636 9,204 20,925 17,867
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Income from operations 900 201 1,416 378
Interest income, net 39 5 59 3
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Net income $ 939 $ 206 $ 1,475 $ 381
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Earnings per share:
Basic and diluted $ 0.02 $ 0.00 $ 0.03 $ 0.01
Weighted average number
of shares outstanding 42,916 41,413 42,645 41,413
MKS Inc.
Consolidated Statements of Cash Flows
(Dollar Amounts in US, In Thousands, Unaudited)
Three Months Ended Six months Ended
October 31 October 31
2005 2004 2005 2004
---- ---- ---- ----
Cash flows from operating
activities:
Net income $ 939 $ 206 $ 1,475 $ 381
Adjustments to reconcile
net income to net cash
used for operating
activities:
Depreciation and
amortization 203 207 390 406
Interest on deferred
compensation - 4 2 9
Loss on disposal of
capital assets - 10 10 10
Change in operating
assets and liabilities:
Accounts receivable (859) 605 708 (162)
Other assets 291 165 189 (143)
Accounts payable, net
of deferred compensation 377 63 285 (295)
Accrued liabilities 139 (26) (651) (104)
Income taxes payable - 8 69 7
Deferred revenue 347 (521) (326) (714)
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Net cash provided by
(used for)
operating activities 1,437 721 2,151 (605)
Cash flows from investing
activities:
Purchase of fixed assets (474) (264) (627) (547)
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Net cash used for investing
activities (474) (264) (627) (547)
Cash flows from financing
activities:
Proceeds on issuance of
common shares 793 - 1,325 4
Payments of deferred
compensation (145) (137) (335) (334)
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Net cash provided by
(used for)
financing activities 648 (137) 990 (330)
Effect of exchange rates
on cash and cash equivalents (39) (72) 172 (127)
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Change in cash and cash
equivalents 1,572 248 2,686 (1,609)
Cash and cash equivalents,
beginning of period 8,913 4,510 7,799 6,367
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Cash and cash equivalents,
end of period $10,485 $ 4,758 $ 10,485 $ 4,758
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Supplemental schedules:
Cash paid for:
Interest $ 3 $ 15 $ 5 $ 31
Income taxes $ - $ 1 $ 22 $ 2
MKS Inc. (TSX:MKX) |
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