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©2000 Intelligent Systems |
FOR IMMEDIATE RELEASE For further
information, call INTELLIGENT
SYSTEMS ANNOUNCES 4TH QUARTER AND FISCAL 2004
RESULTS ***Earnings Conference Call and Webcast at 11 AM Today *** Norcross,
GA – March 17, 2005 –
Intelligent Systems Corporation [AMEX:INS;
www.intelsys.com] announced today its
financial results for the fourth quarter and
fiscal year ended December 31, 2004. For
the fiscal year ended December 31, 2004, the
company recorded revenue of $22.3 million, a 67
percent increase compared to revenue of $13.3
million for the twelve-month period in 2003.
Net income for the twelve-month period in
2004 was $2.6 million or $0.57 per basic share,
compared to a net loss of $4.8 million or $1.07
per basic share recorded in 2003. For
the fourth quarter ended December 31, 2004,
Intelligent Systems recorded revenue of $4.0
million compared to revenue of $4.6 million in
the same period last year.
Net income for the three months ended
December 31, 2004 was $572,000 or $0.13 per
share compared to a net loss of $1.2 million or
$0.26 per share for the same three-month period
in 2003. Compared
to 2003, annual revenue from product sales grew
34 percent in 2004, whereas annual revenue from
services increased 125 percent in 2004.
The year-to-year increase in product
revenue reflects primarily the impact of a $7.5
million software license earned by the
company’s VISaer subsidiary upon completion of
a significant multi-year contract in the third
quarter of 2004, as reported in the previously
announced third quarter results.
The increase in revenue from services
reflects not only the contribution of various
professional services delivered under the major
VISaer contract but also a larger installed base
of customers that purchased maintenance and
support services at all three of the company’s
software subsidiaries.
Additionally, the company reduced
consolidated operating expenses by nine percent
in 2004 compared to 2003.
The
results for the twelve-month period ended
December 31, 2004 include $2.5 million in net
investment income comprised of $2.7 million
related to distributions from minority-owned ISC
Guernsey, an entity that realized a significant
gain from the sale of stock in a U.K. based
company, and investment gains aggregating
$513,000 on transactions involving three other
minority owned technology companies, offset in
part by a write-off of $639,000 on the
company’s minority ownership in an early stage
technology company. The
company also recognized $392,000 in other income
in 2004, almost all of which reflects the final
net gain on the sale of a VISaer product line in
July 2000. By
comparison, in 2003, the company recorded net
investment income of $3.0 million related to a
gain of $4.5 million on the settlement of an
escrow fund related to an earlier sale of an
affiliate company, offset in part by write-downs
aggregating $1.5 million against the carrying
values of investments in certain minority-owned
companies.
During
2004, the company continued to support
investment in important product development
activities at both its CoreCard Software and
VISaer subsidiaries for new software products,
although such expenses were lower in both the
fourth quarter and annual periods of 2004
compared to the same periods in 2003. As
previously noted, the VISaer software contract
that contributed to the sales and profit
increase in 2004 was significantly larger than
the typical software sale recorded by any of the
company’s software subsidiaries and is not
expected to represent a trend. Typically,
software sales and installations take 12 to 24
months to complete, during which time milestone
payments are generally recorded as deferred
revenue until the software is delivered and
customer acceptance occurs.
At December 31, 2004, the company has
recorded $4.9 million in current net deferred
revenue comprised of amounts recorded by its
four consolidated subsidiaries, net of
associated costs, that is expected to be
recognized in 2005. Conference
Call and Webcast Information
As
announced previously, Intelligent Systems has
scheduled a conference call for today at 11 AM
EST to discuss the results of the fourth quarter
and annual periods for 2004.
The call-in number is (877) 226-7144
(domestic) and (706) 679-3941 (local and
international).
A transcript of the conference call will
be available by the end of the day and will be
archived on the company’s website at www.intelsys.com
for 12 months.
About
Intelligent Systems Corporation
For
over 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 technology
industry. 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
Corporation (www.chemfree.com)
(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. In 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," "will," "anticipate," "believe," "intend," "expect," "estimate," "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 company’s worldwide market opportunity, other geopolitical or military actions, and general economic conditions, particularly those that cause business or government to delay or cancel purchase decisions. CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS (in
thousands, except share amounts)
a. Includes $3.2 million investment gains, offset in part by $639,000 write-off of investment. b. Includes $4.5 million gain on escrow settlement, offset in part by $1.5 million in reserves/losses on investments. CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands)
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