Easley, SC – (MARKET WIRE) – November 16, 2009 – Computer Software Innovations, Inc. (OTCBB: CSWI), CSI Technology Outfitters(TM) ("CSI") today announced its financial results for the third quarter and nine months ended September 30, 2009.
• Software Segment Grows 20.9% in Q3 2009
• Revenues Increased 6.5% to quarterly record $17.8 Million in Q3 2009 versus $16.7 Million in Q3 2008
• Gross Profit Increased 13% to $3.8 Million in Q3 2009
• Net Income Increased 62.9% to $0.7 Million in Q3 2009
“We were able to continue the momentum from second quarter and are pleased with our third quarter results. We saw top line growth while also improving our margins in our software segment and being profitable in our software and technology segments,” said Nancy Hedrick, CEO of CSI. “Our team has worked hard to achieve these results under very challenging economic conditions. And we expect fourth quarter bottom line performance better than the prior year, as a result of our earlier cost containment efforts effected at the end of the second quarter.”
Three Month Financial Results for the Period Ended September 30, 2009.
CSI posted revenue of approximately $17.8 million for the third quarter ended September 30, 2009, up approximately $1.1 million or 6.5% compared to the third quarter of 2008. CSI experienced significant growth in its software sector in Q3 of $0.7 million or 20.9%, due to increased new product sales and support. Technology revenues increased $0.4 million or 3.0%, primarily from increased sales in interactive classroom solutions, interactive classroom installations, third party warranties, and technology support.
Gross profit for the third quarter of 2009 was approximately $3.8 million, an increase of $0.4 million, or 13%, compared to the same period of the prior year. The increase was due primarily from an increase in gross profit from the software segment from increased new product sales and support, and a slight increase in gross profit from the technology segment primarily from increased interactive classroom solutions sales.
Operating income for the third quarter of 2009 was approximately $1.3 million, an increase of $0.5 million, or 55%, compared to the same period of the prior year. The increase came from the increase in gross profit coupled with a slight decrease in operating expenses primarily due to a reduction in workforce in May of 2009.
CSI posted net income for the quarter ended September 30, 2009 of approximately $0.7 million, or $0.11 earnings per basic share and $0.05 earnings per diluted share, compared to a net income of approximately $0.4 million or $0.08 earnings per basic share and $0.03 earnings per diluted share for the same period last year.
Earnings before interest, taxes, depreciation and amortization ("EBITDA") were approximately $2.0 million, an increase of $0.6 million or 39.1%. The increase in EBITDA was primarily due to the increase in net income over the prior year after adding back the related tax effects on the increases in net income. (EBITDA is a non-GAAP financial measure. See reconciliation to GAAP measure net income which follows below.)
Nine Month Financial Results for the Period Ended September 30, 2009 .
CSI posted revenue of approximately $40.5 million for the nine months ended September 30, 2009, a decrease of $5.9 million or 13% compared with the same period of the prior year. The decrease was due to a decrease in technology revenues, partially offset by an increase in software revenues over the same period of the prior year. The improvement in software revenues was due primarily to increases in services and support and increased revenues from the acquisition of Version3, offset by a decrease in new product sales. The decrease in technology revenues was due primarily to a decrease in interactive classroom solutions, infrastructure solutions, and engineering, also driven by reductions in education spending in most other hardware categories. These decreases were partially offset by increases in third party warranties and technology support.
Gross profit for the first nine months was approximately $8.8 million, a decrease of $2.2 million, or 19.9% compared to the prior year. The decline was due primarily to a decline in technology segment revenues coupled with a significant portion of personnel costs being fixed and the addition of acquired businesses with traditionally lower margins and increased amortization, and lower new and third-party product sales in the software segment.
Operating income for the first nine months was approximately $1.0 million, a decrease of $2.5 million, or 73% compared to the same period of the prior year. The decline for the nine months was driven primarily by the decrease in gross profit and margins coupled with increased research and development in the Version3 acquired operations, and selling and marketing costs.
CSI posted net income in the first nine months of approximately $0.3 million, or $0.05 earnings per basic share and $0.02 earning per diluted share, compared to a net income of $1.9 million, or $0.37 earnings per basic share and $0.15 earnings per diluted share for the same period last year.
EBITDA decreased 45% or $2.2 million to $2.7 million for the nine months ended September 30, 2009 compared to EBITDA of $5.0 million reported for the same period in 2008. The decrease in EBITDA was primarily due to the decrease in net income over the prior year after adding back the related tax effects on the decreases in net income. (EBITDA is a non-GAAP financial measure. See reconciliation to GAAP measure net income which follows below.)
Conference Call Reminder for Today:
The Company will host a conference call today, Monday, November 16, 2009 at 4:15 Eastern Time to discuss the Company's financial and operational results for third quarter 2009, which ended September 30, 2009.
Conference Call Details
Date: Monday, November 16 2009
Time: 4:15 p.m. (EST)
Dial-in Number: 1-877-941-8416
International Dial-in Number: 1-480-629-9808
It is recommended that participants phone-in approximately 5 to 10 minutes prior to the start of the 4:15 p.m. call. A replay of the conference call will be available approximately three hours after the completion of the call for 30 days, until December 15, 2009. To listen to the replay, dial 1-800-406-7325 if calling within the U.S., 1-303-590-3030 if calling internationally and enter the pass code 4176697.
The call is also being webcast and may be accessed at CSI's website at www.csioutfitters.com. The webcast will be archived and accessible until December 15, 2009 on the Company website.
About Computer Software Innovations, Inc.
CSI provides software and technology solutions to public sector markets. CSI has more than doubled its revenue in the past two years to over $58 million by using organic growth and acquisitions. The CSI solution portfolio encompasses proprietary accounting software specialized for the public sector, lesson planning and identity lifecycle management software, SharePoint development, network infrastructure and end device solutions, IP telephony and IP convergence applications, network management solutions and services, and interactive classroom technologies. More information about CSI (OTC BB: CSWI.OB - News) is available at www.csioutfitters.com
For Finacial Tables, click here.
Forward-Looking and Cautionary Statements
This release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Among other things, these statements relate to our financial condition, results of operations and future business plans, operations, opportunities and prospects. In addition, we and our representatives may from time to time make written or oral forward-looking statements, including statements contained in filings with the Securities and Exchange Commission and in our reports to stockholders. These forward-looking statements are generally identified by the words or phrases “may,” “could,” “should,” “expect,” “anticipate,” “plan,” “believe,” “seek,” “estimate,” “predict,” “project” or words of similar import. These forward-looking statements are based upon our current knowledge and assumptions about future events and involve risks and uncertainties that could cause our actual results, performance or achievements to be materially different from any anticipated results, prospects, performance or achievements expressed or implied by such forward-looking statements. These forward-looking statements are not guarantees of future performance. Many factors are beyond our ability to control or predict. You are accordingly cautioned not to place undue reliance on such forward-looking statements, which speak only as of the date that we make them. We do not undertake to update any forward-looking statement that may be made from time to time by or on our behalf.
In our most recent Form 10-K, we have included risk factors and uncertainties that might cause differences between anticipated and actual future results. We have attempted to identify, in context, some of the factors that we currently believe may cause actual future experience and results to differ from our current expectations regarding the relevant matter or subject area. The operations and results of our software and systems integration businesses also may be subject to the effects of other risks and uncertainties, including, but not limited to:
• a reduction in anticipated sales;
• an inability to perform customer contracts at anticipated cost levels;
• our ability to otherwise meet the operating goals established by our business plan;
• market acceptance of our new software, technology and services offerings;
• an economic downturn; and
• changes in the competitive marketplace and/or customer requirements.
Company Contact: David Dechant
Computer Software Innovations, Inc.
Investor Contact: Daniel Conway
DC Consulting, LLC