Transaction Network Services Announces Third Quarter 1999 Financial Results.RESTON Reston, uninc. city (1990 pop. 48,556), Fairfax co., N Va., a planned community established in 1961. A suburb of Washington, D.C., Reston is organized in a series of residential villages and commercial areas. , Va.--(BUSINESS WIRE)--Oct. 20, 1999-- Revenues Up 80 Percent, Earnings Up 138 Percent Transaction Network Services, Inc. (TNS TNS transcutaneous neural stimulation. ) (NYSE NYSE See: New York Stock Exchange :TNI TNI Transnational Institute (Amsterdam, Netherlands) TNI Tentara Nasional Indonesia TNI Troponin I TNI Trusted Network Interpretation TNI The New Information TNI Telephone Network Interface ) today reported third quarter revenues of $46.1 million, a 80 percent increase over third quarter 1998 revenues of $25.6 million. Revenues for the nine months ended September September: see month. 30, 1999 reached $126.9 million, compared to $64.1 million for the year-ago period. Net income for the quarter reached $5.5 million, or $0.38 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. share, compared to $2.1 million, or $0.16 per diluted share in the year-ago quarter. Net income for the nine months was $9.6 million, or $0.69 per diluted share, compared to $5.8 million, or $0.44 per diluted share for the same period in 1998. The company's POS (1) See point of sale and packet over SONET. (2) "Parent over shoulder." See digispeak. POS - point of sale division contributed $31.1 million to revenues this quarter compared to $16.4 million in the year-ago quarter, representing a 90 percent increase. Year-over-year transaction volume grew from 907 million in the year-ago quarter to 1.6 billion this quarter. Average daily transaction volume for the quarter grew to 17.3 million compared to 9.9 million for the same period last year. These increases reflect incremental Additional or increased growth, bulk, quantity, number, or value; enlarged. Incremental cost is additional or increased cost of an item or service apart from its actual cost. volumes from the September 1998 acquisition of AT&T's Transaction Access Service (TAS TAS abbr. 1. telephone answering system 2. true airspeed ) business, as well as continued growth from existing POS customers. TNS' migration of all TAS transactions to its network was completed in September of 1999. TNS' Telecom Services division third quarter revenues grew 24 percent year-over-year to $9.8 million from increased usage of its CARD
EL(R) telephone call billing validation and fraud control
services and other telecommunications services.
The International Systems division, which includes TNS
subsidiaries in Ireland, Sweden, France, and the UK, contributed $3.4
million to revenues this quarter, an increase of 475 percent from
$591,000 for the same period last year. These revenues include
transaction revenues primarily from TNS' UK subsidiary and royalty
revenues generated from transactions in Canada.
The Financial Services division contributed $1.9 million to
revenue this quarter, a 187 percent increase over third quarter
revenues of $662,000 in 1998. These revenues were generated primarily
from the addition of new customers to the financial services network
and from revenues added through the acquisition of Transline
Communications Inc. in January, 1999. The TNS financial services
network provides a secure, independent, Internet Protocol ("IP")
Extranet for transacting securities trading orders and associated data
electronically between brokerage firms and financial institutions.
Transaction Network Services, Inc. (TNS), headquartered in
Reston, Virginia, provides data communications services for
transaction-oriented applications. The company is listed on the New
York Stock Exchange under the symbol TNI. Additional company
information is available on the TNS website at http://www.tnsi.com .
The statements and information contained in this news release
that are not descriptions of historical fact may be deemed to be
"forward looking statements" within the meaning of Section 27A of the
Securities Act and Section 21E of the Securities Exchange Act that
involve a number of risks and uncertainties that could cause actual
results to differ materially from those currently anticipated. The
risks and uncertainties to which these statements are subject include,
but are not limited to, TNS' ability to complete the expansion of its
"800" backbone and access capacity, the extent to which acquired
businesses and assets are able to meet TNS' expectations and operate
profitably, continuation of TNS' long standing relationships with
major customers and vendors, the impact of future revisions to the
cost of TNS' network services under the Telecommunications Act of
1996, competition, TNS' dependence upon key personnel and its ability
to retain and attract highly skilled personnel, technological change,
and seasonality and fluctuations in quarterly results. See TNS'
reports filed with the SEC for additional discussion of these risks
and other factors which may effect TNS' services, revenues, and costs.
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TRANSACTION NETWORK SERVICES, INC. AND SUBSIDIARIES 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: STATEMENTS OF OPERATIONS (Unaudited) (in thousands, except per share amounts) Three Months Ended Nine Months Ended September 30, September 30, ------------------- ------------------- 1999 1998 1999 1998 ------- ------- ------- ------ Revenues $ 46,127 $ 25,582 $126,954 $ 64,092 Cost of network services 24,513 15,175 75,413 37,049 ------- -------- --------- ------ Gross profit 21,614 10,407 51,541 27,043 ------- -------- --------- ------ Other 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. : Engineering & development 1,735 1,370 4,662 3,538 Selling, general & administrative 5,611 3,152 14,631 8,337 Depreciation 2,732 1,805 7,812 4,792 Amortization of intangibles Property that is a "right" such as a patent, Copyright, or trademark, or one that is lacking physical existence, such as good will. 2,019 1,031 6,205 2,123 Reserve for AMNEX assets (Note 2) - - 919 - ------- ------- -------- -------- Total other operating expenses 12,097 7,358 34,229 18,790 ------- ------- -------- -------- Income from operations before provision for income taxes, equity in earnings of affiliate Affiliate Relationship between two companies when one company owns substantial interest, but less than a majority of the voting stock of another company, or when two companies are both subsidiaries of a third company. See: Subsidiaries, parent company. and minority interest 9,517 3,049 17,312 8,253 Interest expense (1,126) - (3,051) - Interest income and other 379 54 1,253 910 ------- -------- --------- -------- Income before provision for income taxes 8,770 3,103 15,514 9,163 Provision for income taxes 3,290 1,202 5,842 3,597 Equity in earnings of Unconsolidated affiliate - 178 93 259 Minority interest in net income of consolidated subsidiary - 20 (128) 20 ------- -------- --------- ------- Net income $ 5,480 $ 2,099 9,637 $ 5,845 ======= ======== ========= ======= Diluted earnings per common share $ 0.38 $ 0.16 $ 0.69 $ 0.44 Basic earnings per common share $ 0.41 $ 0.17 $ 0.73 $ 0.46 ======= ======== ========= ======== Weighted average shares - diluted 14,555 13,470 14,058 13,253 ======= ======== ========= ======== Weighted average common shares - basic 13,530 12,690 13,199 12,577 ======= ======== ========= ======== |
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