Printer Friendly


 RIVERWOODS, Ill., Oct. 21 /PRNewswire/ -- Tax and business law publisher Commerce Clearing House, Inc. (NASDAQ: CCLR A & B) announced third quarter net income of $2,322,000, or $.07 per share, as compared to a net loss of ($2,698,000), or ($.08) per share, in 1992. Also, the company (CCH) reported consolidated revenues of $123,163,000, down 10 percent from the same period in 1992.
 Third quarter results included approximately $2.5 million of tax benefits arising from the change in federal income tax rates and from divested businesses. Other income included receipt of a $3 million settlement of a business dispute with a former vendor.
 Overall, CCH reported sales of its Electronic Product Lines and Services remained strong, and it experienced high demand for publications relating to the 1993 Tax Legislation and President Clinton's Health Care Reform Plan.
 For the nine-month period ending Sept. 30, 1993, the company reported a net loss of ($7,708,000), or ($.22) per share, compared to a net loss of ($65,500,000), or ($1.88) per share, in 1992. Consolidated revenues of $419,573,000 decreased 16 percent from 1992 during the same period.
 In the past two years, CCH has undertaken a complete overhaul of its Business Units in an effort to reduce its cost structure, develop more value-added products across a broader range of media and improve selling and marketing efforts. During the second quarter of 1993 and 1992, the company recorded restructuring charges of $36 million and $50 million respectively for the anticipated costs of these changes.
 "CCH has implemented a major phase of re-engineering in our Legal Information Services (LIS) segment and virtually concluded our integration of CCH Computax and Domestic Publishing operations," said Edward L. Massie, president and CEO of CCH. "We are committed to our re-engineering efforts and will continue heavy investment in developing capabilities necessary to support our strategy."
 Revenues for LIS Increased 9.3 percent and 4.5 percent, as compared to the third quarter and nine-month periods in 1992. Representation renewals and new electronic product sales contributed to the increases.
 Operating earnings improvements are due in part to the reduced cost structure arising from implementation of key re-engineering initiatives during
the quarter. LIS is expected to benefit increasingly during the fourth quarter as these and additional initiatives are put into place.
 CCH COMPUTAX REVENUES for the quarter of $4,887,000 and for the nine-month period of $55,255,000 decreased $6,003,000 and $67,589,000 from comparable 1992 periods. Operating losses for the quarter of ($9,109,000) compared to ($15,278,000) for the third quarter of 1992 and the nine-month period of ($9,677,000), compared to operating earnings of $5,303,000 in 1992.
 CCH has moved this segment away from mainframe service bureau tax return processing to personal computer-based tax compliance software. As anticipated, these changes resulted in a significantly smaller business with the majority of revenues generated in the fourth and first quarters as opposed to the first and second quarters for service bureaus. Third quarter 1993 results reflected the reduced operating cost structure needed to support a tax compliance software business. Management anticipates this segment will be profitable for 1993 and should experience further improvements in 1994.
 Revenues for the quarter of $92,389,000 and for the nine-month period of $289,330,000 decreased $9,806,000 and $17,768,000 from comparable 1992 periods. Operating earnings for the quarter of $2,998,000 and nine-month period of $7,377,000 decreased $5,360,000 and $13,585,000, respectively, from 1992 periods.
 CCH'S Facts On File and National Quotation Bureau subsidiaries were divested in June 1993, resulting in a pre-tax gain of approximately $13 million. These businesses contributed approximately $28 million in annual revenue in 1992, and $12 million in revenue in 1993 prior to divestiture.
 Publishing experienced improved book sales during the third quarter of 1993 due to passage of Revenue Reconciliation Act of 1993 and increased momentum in electronic product revenues with the addition of new content areas. These increases were offset by declines in loose leaf revenue and a stronger dollar, which devalued revenue and earnings growth in international operations.
 Operating earnings decreased as a result of the Matthew Bender Tax Product Line acquisition impact, concluded during the second quarter of 1993. Acquisition amortization and product conversion costs are expected to dilute earnings for all of 1993 by approximately $5 million. this product line is expected to break-even in 1994.
 Effective Jan. 1, 1992, the company changed its method of accounting for postretirement benefits, postemployment benefits and income taxes to comply with new financial accounting standards board pronouncements. The company recorded an after tax charge of $50,502,000, or $1.45 per share, in 1992 for the cumulative effects of these changes in accounting methods.
 "We'll maintain our aggressive response to the changing market and deliver value to our customers through innovative new products and improved customer satisfaction," said Massie. "Given our progress in reshaping our businesses and our reputation for authoritative products, CCH is positioned to move assertively in the fourth quarter and beyond, particularly in the areas of tax, health care and human resources."
 Consolidated Summary Of Operations
 (Unaudited, in Thousands, Except Share Data)
 Three Months Nine Months
 Periods ended Sept. 30 1993 1992 1993 1992
 Publishing $ 92,389 $ 102,195 $ 289,330 $ 307,098
 Computer processing
 services 4,887 10,890 55,255 122,844
 Legal information
 services 25,887 23,693 74,988 71,757
 Total $ 123,163 $ 136,778 $ 419,573 $ 501,699
 Operating (loss)
 earnings before
 provision for
 restructured operations:
 Publishing $ 2,998 $ 8,358 $ 7,377 $ 20,962
 Computer processing
 services (9,109) (15,278) (9,677) 5,303
 Legal information
 services 727 (69) (1,438) 1,113
 Total (5,384) (6,989) (3,738) 27,378
 Provision for restructured
 operations -- -- (36,000) (50,000)
 Operating loss (5,384) (6,989) (39,738) (22,622)
 Other income, net 5,021 2,461 22,230 6,934
 Loss before income taxes
 and cumulative effect
 of accounting changes (363) (4,528) (17,508) (15,688)
 Income taxes (benefit) (2,685) (1,830) (9,800) (690)
 Earnings (loss) before
 Cumulative effect of
 accounting changes 2,322 (2,698) (7,708) (14,998)
 Cumulative effect of
 changes in method of
 accounting for:
 postretirement and
 postemployment benefits
 other than pensions -- -- -- (51,675)
 income taxes -- -- -- 1,173
 Net earnings (loss) $ 2,322 $ (2,698) $ (7,708) $ (65,500)
 Earnings (loss) per share
 of class a and b common
 stock $ .07 $(.08) $(.22) $(1.88)
 Weighted average number
 of shares
 outstanding 34,209,904 34,762,575 34,566,537 34,794,954
 -0- 10/21/93
 /CONTACT: Kate Arney, 312-463-0074, ext. 2214 or John Abernethy, 312-463-0074, ext. 2134, both of Commerce Clearing House/

CO: Commerce Clearing House, Inc. ST: Illinois IN: SU: ERN

WB -- NY123 -- 2162 10/21/93 18:06 EDT
COPYRIGHT 1993 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1993 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Oct 21, 1993

Terms of use | Copyright © 2017 Farlex, Inc. | Feedback | For webmasters