©2000-2010 Intelligent Systems
FOR IMMEDIATE RELEASE
SYSTEMS ANNOUNCES FIRST QUARTER 2004 RESULTS
Conference Call and Webcast at 11 AM Today ***
GA – May 12, 2004 –
Intelligent Systems Corporation [AMEX:INS; www.intelsys.com] announced today the financial results
for its first fiscal quarter ended March 31,
For the quarter ended March 31, 2004, the
company recorded revenue of $4,612,000, a 45
percent increase compared to revenue of
$3,170,000 for the three-month period ended
March 31, 2003.
The loss from operations for the
three-month period ended March 31, 2004 was
$837,000 compared to a loss from operations of
$2,574,000 in the quarter ended March 31, 2003.
The company recorded a net loss for the
three months ended March 31, 2004 of $820,000 or
$0.18 per basic and diluted common share
compared with a net profit of $949,000 or $0.21
per basic and diluted common share in the
comparable period in 2003.
In the first quarter of 2003, the
company’s results were impacted positively by
investment income of $3,464,000 that offset its
loss from operations and resulted in positive
earnings for the first quarter of last year.
The company did not have any such
investment income in the first quarter of 2004.
The period-to-period growth in revenue is
due to a higher level of software license sales
in the first quarter of 2004 as compared to the
quarter ended March 31, 2003, principally
because the company’s CoreCard Software
subsidiary recorded its first significant
customer revenue during the period.
Although management believes it is
unlikely that the company will experience
similar period-to-period revenue growth in other
fiscal quarters of 2004, the specific timing of
revenue recognition for software licenses is
difficult to predict with any certainty due to a
number of factors that often are not under the
The loss from operations in the first
quarter of 2004 was 67 percent lower than the
loss from operations of $2,574,000 in the first
quarter of 2003 due to the 45 percent increase
in revenue, a lower cost of sales resulting from
a favorable mix of high-margin software sales
and lower marketing and general and
administrative expenses due to cost reductions.
At March 31, 2004, the company has
$3,266,000 in current deferred revenue comprised
of amounts recorded by its four consolidated
subsidiaries and $5,015,000 in non-current
deferred revenue associated with its VISaer
Such deferred revenue will be recognized
in future periods as completed products and
services are delivered to customers.
Subsequent to end of the first quarter,
on May 10, 2004 the company confirmed that it
sold all of its holdings in Cirronet, Inc., a
privately held technology company based in
The unsolicited offer to acquire the
company’s shares of common stock of Cirronet,
Inc. in a private transaction netted cash
proceeds of $1,073,000 to the company and
resulted in an investment gain which will be
reported in the second quarter ended June 30,
Call and Webcast Information
As announced previously, Intelligent
Systems has scheduled a conference call for
today at 11 AM EDT to discuss the results of the
first quarter for 2004.
The call-in number is (877) 266-7144
(domestic) and (706) 679-3941 (local and
A live webcast will be available at the
same time by logging onto www.intelsys.com
and clicking on the webcast icon.
An archived version of the webcast will
be available for 12 months.
Intelligent Systems Corporation
thirty years, Intelligent Systems Corporation
[AMEX: INS] has identified, created, operated
and grown early stage technology companies.
The company has operations and
investments, principally in the information
The company’s consolidated subsidiaries
include VISaer, Inc. (www.visaer.com), QS
Technologies, Inc. (www.qsinc.com),
CoreCard Software, Inc. (www.corecard.com),
(all software companies) and ChemFree
(an industrial products company).
Since 1990, the company has operated the
Intelligent Systems Incubator, an award-winning
pioneer in privately sponsored incubators.
Further information is available on the
company’s website at www.intelsys.com,
or by calling the company at 770/381-2900.
addition to historical information, this news
release may contain forward-looking statements
relating to Intelligent Systems and its
subsidiary and affiliated companies. These
statements include all statements that are not
statements of historical fact regarding the
intent, belief or expectations of Intelligent
Systems and its management with respect to,
among other things, results of operations,
product plans, and financial condition.
The words "may,"
"plan," "strategy" and
similar expressions are intended to identify
forward-looking statements. Prospective
investors are cautioned that any such
forward-looking statements are not guarantees of
future performance and involve risks and
uncertainties and that actual results may differ
materially from those contemplated by such
forward-looking statements. The company does not
undertake to update or revise any
forward-looking statements whether as a result
of new developments or otherwise.
Among the factors that could cause actual
results to differ materially from those
indicated by such forward-looking statements are
delays in product development, undetected
software errors, competitive pressures
(including pricing), changes in customers’
requirements or financial condition, market
acceptance of products and services, changes in
financial markets, changes in the performance,
financial condition or valuation of affiliate
companies, the risks associated with investments
in privately-held early stage companies, the
impact of events, such as the war against IRAQ
and the SARS epidemic, on the worldwide
commercial aviation industry, other geopolitical
or military actions, and general economic
conditions, particularly those that cause
business or government to delay or cancel
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share amounts) (unaudited)
Includes $4.2 million gain on escrow settlement
offset in part by a $719,000 investment
CONSOLIDATED BALANCE SHEETS
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