NIC Grows Portal Revenue 19 Percent in the Fourth Quarter and Declares a Special Cash Dividend of $0.75 Per Share.OLATHE, Kan. -- NIC (1) (Network Interface Card) See network adapter. See also InterNIC. (2) (New Internet Computer) An earlier Linux-based computer from The New Internet Computer Company (NICC), Palo Alto, CA. Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : EGOV) today announced net income of $2.1 million and earnings per share of three cents on total revenues of $18.8 million for the three months ended December 31, 2006. 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 $2.7 million for the quarter. The Company reported net income of $2.4 million and earnings per share of four cents on total revenues of $16.4 million in fourth quarter 2005. On January 29, 2007, the NIC Board of Directors also declared a special dividend of $0.75 per share payable on February 20, 2007, to shareholders of record on February 12, 2007. The dividend payout pay·out n. 1. The act or an instance of paying out. 2. A percentage of corporate earnings that is paid as dividends to shareholders. will total $46.2 million based on the current number of shares outstanding. "We believe this special dividend is an efficient way to distribute to all of our shareholders a substantial portion of NIC's excess cash," said Jeff Fraser, Chief Executive Officer of NIC. "The strength of our balance sheet and confidence in the future prospects of NIC prompted the Board of Directors to declare this special cash dividend. We are very pleased to be able to return cash to shareholders." The Company has made a preliminary determination that the dividend will result in a partial return of capital to shareholders, with the balance being taxable to shareholders as a qualified dividend. The exact amount of the return of capital is dependent on the earnings of the Company through the end of its 2007 fiscal year. Once a final determination is made, the Company will make appropriate notification to shareholders after the close of the year. Shareholders are encouraged to consult with their tax specialists regarding the circumstances of their particular tax situations. Fourth Quarter 2006 Performance Quarterly portal revenues were a record $18.0 million, up 19 percent over fourth quarter 2005. On a same state basis, portal revenues grew 17 percent in the fourth quarter, compared to a 13 percent increase during the same period a year ago. NIC's online vehicle tag renewal, hunting and fishing license, and professional license renewal services performed well in the fourth quarter, helping same state transaction-based revenues from non-driver record exchange (non-DMV) applications to rise 38 percent. Total DMV DMV abbr. Department of Motor Vehicles revenues grew 8 percent on a same state basis in the fourth quarter. In the fourth quarter, NIC's portals launched 72 new non-DMV revenue-generating services and another 148 applications are in the development pipeline. "NIC will continue to focus on innovation in 2007 as we expand our base of more than 1,000 revenue-generating services," said NIC President Harry Herington. Selling and administrative expenses rose to $4.4 million in the current quarter compared to $3.1 million in the fourth quarter of 2005. As a percentage of portal revenue, selling and administrative expenses were 25 percent in the current quarter compared to 21 percent in the fourth quarter of 2005. NIC ended the year with approximately $81.8 million in cash and investments, up $7.1 million from September 30, 2006. Full-Year 2006 Performance For fiscal year 2006, portal revenues rose 21 percent to $70.0 million. On a same state basis, portal revenues grew 10 percent and transactional non-DMV revenues rose 27 percent. Selling and administrative expenses as a percentage of portal revenue were unchanged year-over-year at 22 percent. Operating income was $16.1 million for the year, up from $10.2 million in 2005. The Company earned 17 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. in 2006, compared to 11 cents per share in 2005 (10 cents on a fully 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. basis). Results for 2005 include a $5.0 million pretax pre·tax adj. Existing before tax deductions: pretax income. pretax adj [profit] → vor (Abzug der) Steuern charge recorded in the first quarter relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc NIC's software and services engagement with the California Secretary of State. Absent this charge, the Company would have posted operating income of $15.1 million and earnings per share of 16 cents in 2005 (15 cents on a fully diluted basis). Investing in Growth NIC continued its investment in growth in the fourth quarter, which led to an increase in selling and administrative expenses to $4.4 million, up from $3.1 million in the same quarter last year. "The next several years will be critical for adding new state portals, and the most effective way to do that is to increase our presence in the states that have the highest likelihood of success," continued Fraser. "We will also continue to enhance our operations to do an even better job of cross-selling our most promising non-DMV services across the country." The Company estimates the cost of these initiatives will be $4 - $6 million in 2007, with associated revenue unlikely prior to 2008. Operating Highlights During the fourth quarter, Vermont (www.Vermont.gov) signed a new self-funded portal management agreement with NIC for a contract term of up to six years. The Company now manages official government Web portals See portal. for 19 states. NIC also signed a one-year portal management contract renewal with Hawaii (www.eHawaii.gov). "We are honored that the leadership in Vermont has put its trust in NIC and thank our partners in Hawaii for their vote of confidence," concluded Fraser. Full-Year 2007 Outlook For full-year 2007, NIC expects total revenues of $80.0 - $81.5 million, portal revenues of $77.0 - $78.0 million, and software and services revenues of $3.0 - $3.5 million. The Company also anticipates operating income between $11.8 - $12.2 million and net income of $7.5 - $8.0 million. "While our overall 2007 results will be tempered by investments in growth, we expect our portal business to have another solid year," said Eric Bur, Chief Financial Officer of NIC. "Note that our projections do not include any new portal contracts." "Portal margins should range from 45 - 47 percent in 2007 as we continue to reinvest re·in·vest tr.v. re·in·vest·ed, re·in·vest·ing, re·in·vests To invest (capital or earnings) again, especially to invest (income from securities or funds) in additional shares. in the portal business," continued Bur. "We also expect selling and administrative expenses to range from 28 - 29 percent of portal revenue in 2007, which reflects higher investment in sales, marketing, and operations to drive future growth opportunities." Fourth Quarter Earnings Webcast Details
Wednesday, January 31, 2007
4:30 p.m. (EST)
Call leaders: Jeff Fraser, Chief Executive Officer
Harry Herington, President
Eric Bur, Chief Financial Officer
To sign in and listen: The Webcast system is available at www.nicusa.com/investor. Some users may need to refresh (1) To continuously charge a device that cannot hold its content. CRTs must be refreshed, because the phosphors hold their glow for only a few milliseconds. Dynamic RAM chips require refreshing to maintain their charged bit patterns. See vertical scan frequency and redraw. their browsers to view the Webcast information. A replay of the Webcast will be available until 11:00 p.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 ) on April 30, 2007, by visiting www.nicusa.com/investor. An audio replay of NIC's fourth quarter earnings call will be available until 4:00 p.m. (EST EST electroshock therapy. EST abbr. electroshock therapy ) on February 6 by dialing 1-800-405-2236 and using passcode 11065543. NIC's earnings announcements are also available via podcast (iPOD broadCAST) An audio broadcast that has been converted to an MP3 file or other audio file format for playback in a digital music player or computer. The "pod" in podcast was coined from "iPod," the predominant portable, digital music player, and although podcasts are download. For more information, visit www.nicusa.com/investor. About NIC NIC manages more eGovernment services than any provider in the world. The company is helping governments communicate more effectively with citizens and businesses by putting essential services online. NIC provides eGovernment solutions for 2,200 state and local agencies that serve more than 60 million people in 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. . Additional company information is available at www.nicusa.com. The statements in this release regarding continued implementation of NIC's business model and its development of new products and services 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. . There are a number of important factors that could cause actual results to differ materially from those suggested or indicated by such forward-looking statements. These include, among others, the success of the Company in signing contracts with new states and government agencies, including continued favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. government legislation; NIC's ability to develop new services; existing states and agencies adopting those new services; acceptance of eGovernment services by businesses and citizens; competition; and general economic conditions and the other important cautionary statements and risk factors described in NIC's 2005 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. filed on March 16, 2006, with the Securities and Exchange Commission. [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] |
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