PADUCAH, Ky., July 7, 2014 /PRNewswire/ -- Computer Services,
Inc. (CSI) (OTCQX: CSVI) today reported record revenues and
net income for the first quarter of fiscal 2015, which ended
May 31, 2014.
(Logo: http://photos.prnewswire.com/prnh/20080418/CSILOGO )
CSI's revenues grew 5.5% to $54.6
million for the first quarter of fiscal 2015 compared with
$51.7 million for the first
quarter of fiscal 2014. Net income rose 4.7% to $6.3 million for the first quarter of fiscal 2015
compared with $6.0 million in the
first quarter of fiscal 2014. Net income per share increased 7.3%
to $0.44 for the first quarter
of fiscal 2015 compared with $0.41
for the prior year's first quarter.
"CSI's record results benefited from solid growth in revenues
from new customers and increased volume from existing customers,"
stated Chief Executive Officer Steven A.
Powless. "This quarter marked our 40th
consecutive quarter of revenue growth. We continue to benefit from
customers signing long-term processing contracts that highlight
their confidence in CSI's continuing to deliver high-quality
services in the future. Other revenues benefited from growth
in transaction volume, as well as increased demand for both
regulatory compliance services and Internet and mobile banking
products.
"Our outlook for fiscal 2015 remains positive based on our
pipeline for new processing business, high contract renewal rate
from customers and expanded revenues from regulatory compliance
services. We remain focused on driving revenue growth through
our expanded national sales network and product innovation, and
expanding our market reach as a total solutions provider," Powless
continued.
First Quarter Results
Consolidated revenues rose 5.5% to $54.6
million for the first quarter of fiscal 2015 compared with
$51.7 million in the first
quarter of fiscal 2014. Processing revenues rose 1.6% to
$34.2 million compared with
$33.6 million for the first
quarter of fiscal 2014. The growth in processing revenues was
driven primarily by sales to new customers, cross-sales to existing
customers and increases in transaction volume from existing
customers, offset partially by the effect of lost business. Other
revenues rose 12.8% to $20.4 million
compared with the first quarter of fiscal 2014. Other revenues
benefited from growth in Internet and mobile banking services,
growth in homeland security products and fraud prevention services,
and increased demand for our document services.
Operating income rose 5.0% to $10.5
million for the first quarter of fiscal 2015 compared with
$10.0 million for the first
quarter of fiscal 2014. Operating margin was 19.2% in the first
quarter of fiscal 2015 compared with 19.3% for the first quarter of
fiscal 2014. The slight decrease in operating margin was due
primarily to the ramp up of expenses related to our Strategic
Growth Initiative (SGI)that we launched in fiscal 2012. In
addition, expenses increased for equipment, increased fees related
to growth in our ATM and debit card business, and higher network
communications expense.
Net income for the first quarter of fiscal 2015 rose 4.7% to
$6.3 million compared with
$6.0 million for the first quarter of
fiscal 2014. Net income per diluted share increased 7.3% to
$0.44 for the first quarter of fiscal
2015 on 14.2 million weighted average diluted shares outstanding
compared with $0.41 for the
first quarter of fiscal 2014 on 14.6 million weighted average
diluted shares outstanding.
"CSI's balance sheet remained strong on May 31, 2014, with $9.2
million in cash and no long-term debt," Powless said. "Our
cash flow from operations increased to $14.7
million in the first quarter of fiscal 2015. We continue to
use our strong financial position and solid cash flow to invest in
our business while returning a portion of our earnings to
shareholders through our cash dividend program and repurchases of
CSI stock. During the first quarter, we invested about $3.1 million in new equipment and software to
support our continued growth and returned $3.5 million to shareholders in cash dividends
and stock repurchases and redemptions."
About Computer Services, Inc.
Computer Services, Inc. delivers core processing, managed
services, mobile and Internet solutions, payments processing, print
and electronic distribution, and regulatory compliance solutions to
financial institutions and corporate customers across the nation.
Exceptional service, dynamic solutions and superior results are the
foundation of CSI's reputation, and have resulted in the company's
inclusion in such top industry-wide rankings as the FinTech 100,
Talkin' Cloud 100 and MSPmentor Top 501 Global Managed Service
Providers List. CSI's stock is traded on OTCQX under the symbol
CSVI. For more information about CSI, visit www.csiweb.com.
Forward-Looking Statements
This news release contains "forward-looking statements" as that
term is defined in the Private Securities Litigation Reform Act of
1995. All statements except historical statements contained herein
constitute "forward-looking statements." Forward-looking statements
are inherently uncertain and are based only on current expectations
and assumptions that are subject to future developments that may
cause results to differ materially. Readers should carefully
consider: (i) economic, competitive, technological and governmental
factors affecting CSI's operations, customers, markets, services,
products and prices; (ii) risk factors affecting the financial
services information technology industry generally including, but
not limited to, cybersecurity risks that may result in increased
costs for us to protect against the risks, as well as liability or
reputational damage to the Company in the event of a breach of our
security; and (iii) other factors discussed in CSI's Annual Report,
Quarterly Reports, Information and Disclosure Statements and other
documents posted from time to time on the OTCQX website
(www.otcqx.com), including without limitation, the description of
the nature of CSI's business and its management discussion and
analysis of financial condition and results of operations for
reported periods. Unless required by law, CSI undertakes no
obligation to update, and is not responsible for updating, the
information contained in this report beyond the publication date,
whether as a result of new information or future events, or to
conform the statement to actual results or changes in CSI's
expectations, or otherwise or for changes made to this document by
wire services or Internet services.
COMPUTER SERVICES,
INC. AND SUBSIDIARIES
|
Condensed
Consolidated Statements of Income
|
(Unaudited)
|
(in thousands,
except share and per share data)
|
|
|
|
|
|
Three Months Ended
May 31,
|
|
2014
|
|
2013
|
|
|
|
|
Processing
revenues
|
$ 34,163
|
|
$ 33,623
|
Other
revenues
|
20,407
|
|
18,097
|
Total revenues
|
54,570
|
|
51,720
|
Operating
expenses
|
44,075
|
|
41,729
|
Operating income
|
10,495
|
|
9,991
|
Interest income
(expense)
|
-
|
|
(12)
|
Income before income
taxes
|
10,495
|
|
9,979
|
Provision for income
taxes
|
4,172
|
|
3,942
|
|
|
|
|
Net income
|
$ 6,323
|
|
$ 6,037
|
|
|
|
|
|
|
|
|
Earnings per share,
basic and diluted
|
$
0.44
|
|
$
0.41
|
|
|
|
|
Shares used in
computing earnings per
|
|
|
|
common and common equivalent
share
|
14,222,915
|
|
14,615,121
|
COMPUTER SERVICES,
INC. AND SUBSIDIARIES
|
Condensed
Consolidated Balance Sheets
|
(in thousands,
except share data)
|
|
|
|
|
|
|
|
05/31/2014
|
|
02/28/2014
|
|
05/31/2013
|
|
(Unaudited)
|
|
(Audited)
|
|
(Unaudited)
|
ASSETS
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
Cash and cash
equivalents
|
$ 9,203
|
|
$ 1,078
|
|
$ 5,134
|
Accounts
receivable
|
22,857
|
|
25,962
|
|
22,074
|
Income tax
receivable
|
-
|
|
538
|
|
-
|
Prepaid expenses and
other current assets
|
10,018
|
|
9,628
|
|
7,331
|
Total current assets
|
42,078
|
|
37,206
|
|
34,539
|
Property
and equipment, net of accumulated depreciation
|
35,055
|
|
35,252
|
|
35,727
|
Software
and software licenses, net of accumulated amortization
|
17,470
|
|
17,963
|
|
19,147
|
Goodwill
|
60,115
|
|
60,115
|
|
60,115
|
Intangible
assets
|
7,936
|
|
8,264
|
|
9,057
|
Other
assets
|
16,523
|
|
16,120
|
|
8,783
|
|
|
|
|
|
|
Total
assets
|
$ 179,177
|
|
$ 174,920
|
|
$ 167,368
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
Accounts payable and
accrued expenses
|
$ 19,148
|
|
$ 18,536
|
|
$ 16,582
|
Deferred
revenue
|
8,544
|
|
9,430
|
|
8,496
|
Income tax
payable
|
2,745
|
|
-
|
|
2,075
|
Notes
payable
|
-
|
|
7
|
|
49
|
Total
current liabilities
|
30,437
|
|
27,973
|
|
27,202
|
Long-term liabilities
|
|
|
|
|
|
Deferred income
taxes
|
14,418
|
|
14,418
|
|
13,193
|
Other long-term
liabilities
|
1,243
|
|
1,198
|
|
1,278
|
Total long-term liabilities
|
15,661
|
|
15,616
|
|
14,471
|
|
|
|
|
|
|
Total liabilities
|
46,098
|
|
43,589
|
|
41,673
|
|
|
|
|
|
|
Shareholders' equity
|
|
|
|
|
|
Preferred stock;
shares authorized, 5,000,000; none issued
|
-
|
|
-
|
|
-
|
Common stock, no par;
shares authorized, 20,000,000 in fiscal 2015 and
|
|
|
|
|
|
fiscal 2014; shares issued and outstanding, 14,231,626 at May 31,
2014,
|
|
|
|
|
|
14,227,951 at February 28, 2014 and 14,558,794 at May 31,
2013
|
21,332
|
|
20,316
|
|
20,504
|
Retained
earnings
|
111,747
|
|
111,015
|
|
105,191
|
Total shareholders' equity
|
133,079
|
|
131,331
|
|
125,695
|
|
|
|
|
|
|
Total liabilities and
shareholders' equity
|
$ 179,177
|
|
$ 174,920
|
|
$ 167,368
|
SOURCE Computer Services, Inc.