Phoenix International Announces Fourth Quarter and Year End 1998 Results.ORLANDO Orlando, city, United StatesOrlando (ôrlăn`dō), city (1990 pop. 164,693), seat of Orange co., central Fla., in a lake region; inc. 1875. In a citrus fruit and farm area, it is one of the world's most visited vacation spots. , Fla.--(BUSINESS WIRE)--Feb. 4, 1999--Phoenix International Ltd., Inc. (Nasdaq/NM:PHXX) a world leader in installed client/server An architecture in which the user's PC (the client) is the requesting machine and the server is the supplying machine, both of which are connected via a local area network (LAN) or wide area network (WAN). retail banking management solutions, today reported revenues and earnings for the fourth quarter and year ended December December: see month. 31, 1998. Revenues for the fourth quarter ended December 31, 1998 totaled $7.7 million, an increase of 26% from $6.1 million for the fourth quarter ended December 31, 1997. Net income totaled $782,000, or $0.09 per share (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. ), on 8.9 million average shares outstanding for the fourth quarter ended December 31, 1998, versus $1.3 million, or $0.14 per share (diluted), on 8.7 million average shares outstanding in the fourth quarter last year. Revenues for the twelve months ended December 31, 1998 totaled $25.9 million, up 45% from $17.8 million reported for the twelve months ended December 31, 1997. Net income for the year ended December 31, 1998 was $2.4 million, compared with $3.0 million reported in the same period of 1997. Earnings per share amounted to $0.27 per share (diluted), on 8.9 million average shares outstanding for the twelve months ended December 31, 1998, versus $0.41 per share (diluted), on 7.3 million average shares outstanding a year ago. As a result of an accounting change for Phoenix effective January January: see month. 1, 1998, there is a deferral deferral - Waiting for quiet on the Ethernet. effect on revenues and earnings for the fourth quarter and twelve months ended December 31, 1998, compared with revenue recognition for the same period in 1997. AICPA AICPA See American Institute of Certified Public Accountants (AICPA). Statement of Position (SOP) 97-2 "Software Revenue Recognition," which supersedes SOP 91-1, mandates mandates, system of trusteeships established by Article 22 of the Covenant of the League of Nations for the administration of former Turkish territories and of former German colonies. all software companies to recognize any revenue from software that requires extensive modification A change or alteration in existing materials. Modification generally has the same meaning in the law as it does in common parlance. The term has special significance in the law of contracts and the law of sales. to be recognized over the period of the modification. License revenue that had been booked when the software was delivered, but required modification, is now recognized on a percentage-of-completion basis. The Company believes that this effect will be reduced in future periods. The 20% increase in the average number of shares outstanding for the twelve months ended December 31, 1998, respectively, is due principally to the shares issued in the Company's common stock offering in August 1997. All figures in this release have been adjusted to reflect the Company's three-for-two stock split, which was effected May 18, 1998. "The overall momentum in our business remains strong as Phoenix International achieved substantial growth and reported record revenues in 1998," commented Bahram Bahram or Vahram (Persian: بهرام), alternative spelling Bahran or Vahran, (Uzbek: Баҳром, Bahrom Yusefzadeh, chairman of the board and chief executive officer of Phoenix International. "As previously reported, we did not achieve our targeted level of revenues in the fourth quarter due to an unexpected shortfall Shortfall The amount by which the capital required to fulfill a financial obligation exceeds available capital. Notes: Shortfall risk is often combated with an efficient hedging strategy created by a fund, group, institution, or individual. in sales in Latin America Latin America, the Spanish-speaking, Portuguese-speaking, and French-speaking countries (except Canada) of North America, South America, Central America, and the West Indies. and Year 2000 deferrals 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. . While we expected to finish the year on a high note, we believe this setback setback In architecture, a steplike recession in the profile of a high-rise building. Usually dictated by building codes to allow sunlight to reach streets and lower floors, the building must take another step back from the street for every specified added height interval. will prove to be temporary as we focus on capitalizing on the increasing interest in the Phoenix System. Our sales trends remain positive as banks continue to embrace the value of client/server systems over older, legacy systems. This trend is confirmed by the growth in our customer base over the past year. Phoenix had a total of 64 banks implemented domestically and internationally at the end of 1998, a 64% increase compared with 39 banks implemented at the end of 1997. "1998 was marked by a number of impressive milestones for Phoenix," Yusefzadeh added. "We released version released version - release 2.0 of the Phoenix System to support our growing customer base and deliver enhanced capabilities. As a result of focused investments in our infrastructure, we saw significant improvement in our implementation cycles resulting in more installations and improved customer satisfaction. We launched several major marketing initiatives including our entry into the credit union market and the establishment of offshore development facilities in Australia Australia (ôstrāl`yə), smallest continent, between the Indian and Pacific oceans. With the island state of Tasmania to the south, the continent makes up the Commonwealth of Australia, a federal parliamentary state (2005 est. pop. and the Middle East. In addition, we announced strategic alliances with world technology leaders such as Microsoft Corporation (company) Microsoft Corporation - The biggest supplier of operating systems and other software for IBM PC compatibles. Software products include MS-DOS, Microsoft Windows, Windows NT, Microsoft Access, LAN Manager, MS Client, SQL Server, Open Data Base Connectivity (ODBC), MS Mail, , IBM (International Business Machines Corporation, Armonk, NY, www.ibm.com) The world's largest computer company. IBM's product lines include the S/390 mainframes (zSeries), AS/400 midrange business systems (iSeries), RS/6000 workstations and servers (pSeries), Intel-based servers (xSeries) and Siemens (Siemens AG, Munich, Germany, www.siemens.com) A leading European electrical and electronics firm founded in 1847. Siemens has more than 430,000 employees in nearly 200 countries, and more than 50,000 professionals are engaged in research and development. Business Services which will support our sales and distribution capabilities and are clear indications of the strength of our product. We believe we have created the right infrastructure to support our future growth and remain optimistic op·ti·mist n. 1. One who usually expects a favorable outcome. 2. A believer in philosophical optimism. op about our prospects with a growing worldwide customer base, superior technology and a focused growth strategy." Phoenix International Ltd., Inc., headquartered in Orlando, Florida The city of Orlando is a major city in central Florida and is the county seat of Orange County, Florida. According to the 2000 census, the city population was 185,951. A 2006 U.S. , is a leading provider of highly adaptable a·dapt·a·ble adj. Capable of adapting or of being adapted. a·dapt  a·bil , enterprise-wide
client/server application software to the financial services The examples and perspective in this article or section may not represent a worldwide view of the subject.Please [ improve this article] or discuss the issue on the talk page. industry worldwide. The Company's products include the Phoenix System, a fully integrated client/server retail banking system that includes customer relationship information management, on-line customer profitability Customer profitability (CP) is the difference between the revenues earned from and the costs associated with the customer relationship in a specified period. According to Philip Kotler,"a profitable customer is a person,household or a company that overtime,yields a revenue analysis, financial reporting, an executive information management system and fully integrated teller TELLER. An officer in a bank or other institution. He is said to take that name from tallier, or one who kept a tally, because it is his duty to keep the accounts between the bank or other institution and its customers, or to make their accounts tally. , telephone, ATM and 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 banking modules; Phoenix TradeWind(TM), a trade finance system; and Phoenix TradeCentre, a global payments system. As a full service provider, Phoenix offers clients a full complement of professional and systems integration services. This press release contains statements which constitute 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, as amended a·mend v. a·mend·ed, a·mend·ing, a·mends v.tr. 1. To change for the better; improve: amended the earlier proposal so as to make it more comprehensive. 2. , and Section 21E of the Securities Exchange Act of 1934, as amended. These statements appear in a number of places in this release and include all statements that are not statements of historical fact regarding the intent, belief or expectations of the Company and its management with respect to, among other things: (i) the anticipated impact of certain events and circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or ; (ii) trends affecting the Company's financial condition or results of operations; and (iii) the Company's growth strategy and operating strategy. Phoenix's actual results may vary significantly from the results anticipated in these forward-looking statements as a result of various risks, assumptions and certain factors. Among the key risks, assumptions and factors that may affect operating results, performance and financial condition are the Company's reliance on significant new customers and the timing of customer contracts; dependence on strategic alliances and marketing relationships; ability to expand and leverage its sales force and other distribution channels worldwide; fluctuations in quarterly results; ability to continue and manage growth; Year 2000 risks and concerns; competition and other factors that are discussed in detail in Phoenix's filings with the Securities and Exchange Commission, including the "Risk Factors" section in Phoenix's Registration Statement on Form S-1 (Registration No. 333-31415), as declared de·clare v. de·clared, de·clar·ing, de·clares v.tr. 1. To make known formally or officially. See Synonyms at announce. 2. To state emphatically or authoritatively; affirm. 3. effective by the Securities and Exchange Commission on August 13, 1997. -0-
PHOENIX INTERNATIONAL LTD., INC.
Condensed Consolidated Financial Results
(Unaudited)
Three Months Ended
December 31,
--------------------------------
1998 1997
-------------- --------------
Total revenues $ 7,671,000 $ 6,068,000
Net income $ 782,000 $ 1,254,000
Net income per share (basic) $ 0.09 $ 0.15
Weighted average number of shares
outstanding (basic) (1) 8,494,000 8,153,000
Net income per share (diluted) $ 0.09 $ 0.14
Weighted average number of shares
outstanding (diluted) (1) 8,935,000 8,727,000
Twelve Months Ended
December 31,
--------------------------------
1998 1997
-------------- --------------
Total revenues $ 25,938,000 $ 17,843,000
Net income $ 2,431,000 $ 3,041,000
Net income per share (basic) $ 0.29 $ 0.45
Weighted average number of shares
outstanding (basic) (1) 8,379,000 6,698,000
Net income per share (diluted) $ 0.27 $ 0.41
Weighted average number of shares
outstanding (diluted) (1) 8,866,000 7,343,000
Net income excluding
acquisition expenses(2) $ 2,431,000 $ 3,315,000
Net income per share (basic)
excluding acquisition
expenses (2) $ 0.29 $ 0.50
Net income per share (diluted)
excluding acquisition
expenses (2) $ 0.27 $ 0.45
(1) Reflects three-for two stock split effective May 18, 1998.
(2) Excluding nonrecurring Priority Solutions acquisition expense of
$274,000 in the quarter ended June 30, 1997.
Phoenix International Ltd., Inc.
Consolidated Statement of Operations
(In thousands except per share amounts)
Three Months Ended Twelve Months Ended
December 31, December 31,
------------------ ------------------
1998 1997 1998 1997
----- ---- ---- ----
Revenues: (Unaudited) (Unaudited)
License fees
and other $ 4,561 $ 4,740 $ 16,034 $ 12,664
Implementation,
customer and
software support
and other service fees 3,110 1,328 9,904 5,179
---------- -------- -------- ---------
Total revenues 7,671 6,068 25,938 17,843
Expenses:
Cost of license
fees and other 126 465 1,694 1,595
Cost of implementation,
customer and software
support and other
service fees 1,795 1,058 6,356 3,887
Sales and marketing 1,307 1,243 4,440 3,264
General and
administrative 1,249 766 4,562 2,743
Product development 2,408 1,113 6,869 3,274
---------- -------- -------- ---------
Total expenses 6,885 4,645 23,921 14,763
Other income (expense):
Interest income 453 438 1,698 800
Interest expense (17) (15) (57) (53)
Other income (19) 24 82 134
---------- -------- -------- ---------
Income before taxes 1,203 1,870 3,740 3,961
Income tax expense 421 616 1,309 920
---------- -------- -------- ---------
Net income $ 782 $ 1,254 $ 2,431 $ 3,041
---------- -------- -------- ---------
---------- -------- -------- ---------
Net income per
share - Basic $ 0.09 $ 0.15 $ 0.29 $ 0.45
---------- -------- -------- ---------
---------- -------- -------- ---------
Net income per
share - Diluted $ 0.09 $ 0.14 $ 0.27 $ 0.41
---------- -------- -------- ---------
---------- -------- -------- ---------
Weighted average
shares outstanding
- Basic 8,494 8,153 8,379 6,698
Weighted average
shares outstanding
- Diluted 8,935 8,727 8,866 7,343
Phoenix International Ltd., Inc.
Consolidated Balance Sheets
December 31, December 31,
1998 1997
------------ ------------
(Unaudited)
ASSETS
Current assets:
Cash and investments $ 9,791 $ 20,739
Accounts receivable 15,656 8,345
Deferred tax asset 3,682 2,229
Other current assets 476 592
------------ ------------
Total current assets 29,605 31,905
Long term investments 16,534 13,088
Property and equipment, net 4,329 2,346
Capitalized software costs, net 7,155 3,522
Other assets 1,879 1,296
------------ ------------
Total assets $ 59,502 $ 52,157
------------ ------------
------------ ------------
LIABILITY AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 600 $ 625
Accrued expenses 2,128 1,811
Capital lease, current portion 142 130
Deferred revenue 2,649 1,851
------------ ------------
Total current liabilities 5,519 4,417
Long term liabilities
Deferred revenue under economic
development grant - 95
Deferred tax liability 2,817 1,309
Capital lease, long term portion 358 501
------------ ------------
Total long term liabilities 3,175 1,905
Shareholders' equity 50,808 45,835
------------ ------------
Total liabilities and shareholders'
equity $ 59,502 $ 52,157
------------ ------------
------------ ------------
Refer to the Company's Form 10-K and Form 10-Q for more detailed
financial statements
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