ANNOUNCES FIRST QUARTER RESULTS THE CONTINUUM COMPANY, INC.
ANNOUNCES FIRST QUARTER RESULTS THE CONTINUUM COMPANY, INC. AUSTIN, Texas, July 23 /PRNewswire/ -- The Continuum Company, Inc. (NYSE: CNU) announced improved earnings for the quarter ended June 30, 1992 compared to the same quarter last year. The improvement was caused by substantial license sales. For the first fiscal quarter ended June 30, 1992 compared to a year earlier, net income increased 50 percent to $1,591,000 and earnings per share increased from $.10 to $.15. License revenue increased from $1,086,000 to $3,543,000 more than offsetting decreased service gross profit and increased marketing and administrative expenses. W. Michael Long, chief executive officer, noted, "We are pleased with the significant new CCA2 (TM) and COGEN (TM) product licenses sales in Europe and North America and the launch of the CCA2 implementation at Asahi Mutual Life Insurance Company of Japan. This broad market acceptance is further confirmation of our new product line for the life and property and casualty insurance industries. "We are continuing to increase our marketing investments for product and outsourcing sales in North America as well as pressing our attack on Continental Europe. Service revenue declines occurred in our CCA (TM) business as customers repositioned their implementation investments in anticipation of CCA2. Our second quarter service revenue will benefit as we assign staff to our Asahi project in Japan." THE CONTINUUM COMPANY, INC. Service Revenue Profitability (000 omitted): Quarter ended June 30 Mar 31 June 30 1992 1992 1991 Service revenue $26,004 $30,306 $27,917 Service expenses 20,125 20,616 21,407 Service gross profit $ 5,879 $ 9,690 $ 6,510 Service gross profit 23pct. 32pct. 23pct. Compared to a year earlier, service revenue decreased 7 percent and service expenses decreased 6 percent, resulting in a service gross profit decrease of approximately $600,000. Compared to the fourth quarter of 1992, service revenue decreased 14 percent. Service expenses decreased $500,000. Resources were retained for the Asahi project and for new implementation projects resulting from product sales the company anticipates during the remainder of the fiscal year. Customer Geography U.S. customers accounted for 37 percent of first quarter service revenue and European customers accounted for 45 percent. U.S. customers accounted for 40 percent of total revenues and European customers accounted for 44 percent. Australian and Japanese customers accounted for the remainded. Service Revenue by Product Approximately 37 percent of first quarter revenue was related to Continuum's CCA software product and 28 percent was related to Continuum's other life insurance products, LIFE-COMM (TM), LIFE/70 (TM) and CLOAS (TM). The remaining 35 percent of revenue was primarily related to COGEN and COLOSSUS (TM), systems for property and casualty insurance companies. Advanced Development Program Revenue ADP revenue for the first quarter of fiscal 1993 was approximately $400,000 more than the same quarter last year but approximately $1 million less than the fourth quarter of fiscal 1992. Delivery of the CCA2 products resulting from the ADP has begun and will continue throughout the remainder of the fiscal year. Marketing and Administrative Expenses Marketing and administrative expenses for the first fiscal quarter were $7,020,000 or 24 percent of total revenue, compared to a year ago when they were $6,212,000 or 21 percent of revenue. Continuum has increased investments and emphasis on its U.S. marketing activities for product sales and outsourcing and has continued to invest heavily in growth strategies to increase its presence in Europe and the Pacific Rim and in the property and casualty insurance industry. Personnel Continuum employment worldwide was 1050, a decrease of 30 during the first fiscal quarter. THE CONTINUUM COMPANY, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (unaudited) Periods ended Three Months June 30 1992 1991 Revenue: Software systems licensing $ 3,543,000 $ 1,086,000 Service revenues 26,004,000 27,917,000 Interest income 299,000 432,000 29,846,000 29,435,000 Expenses: Service expenses 20,125,000 21,407,000 Marketing and administration 7,020,000 6,212,000 Total 27,145,000 27,619,000 Income before provision for income taxes 2,701,000 1,816,000 Provision for income taxes 1,110,000 745,000 Total $ 1,591,000 $ 1,071,000 Earnings per common share $ 0.15 $ 0.10 Average common shares outstanding 10,780,000 10,684,000 -0- 7/23/92 /CONTACT: John L. Westermann III of The Continuum Company, Inc., 512-345-5700/ (CNU) CO: The Continuum Company ST: Texas IN: SU: ERN
AH -- NY126 -- 2860 07/23/92 20:21 EDT
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|Date:||Jul 23, 1992|
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