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Exhibit 99.1

 

 

CIBER, Inc.

6363 S. Fiddler’s Green Circle, Suite 1400

Greenwood Village, CO 80111

www.ciber.com

 

For Immediate Release

Contact:

Doug Eisenbrandt

 

 

Director/Investor Relations

 

 

303-220-0100

 

 

deisenbrandt@ciber.com

 

CIBER REPORTS THIRD QUARTER AND NINE MONTHS 2009 RESULTS

 

GREENWOOD VILLAGE, Colorado – October 27, 2009 – Today CIBER, Inc. (NYSE: CBR), a leading international IT outsourcing and software services consultancy, reported its financial results for the third quarter of 2009.  We will hold a conference call on October 27, 2009 at 11:00 a.m. EST to discuss this information; the conference call and webcast information can be found later in this release.

 

Management Comments:

 

CIBER posted positive cash flow for the 63rd consecutive quarter, continuing its 100% track record of generating quarterly positive cash flow as a public company.  Additionally, CIBER’s new $155 million credit facility gives the company ample liquidity to support growth with reasonable covenants that allow for operational flexibility.

 

CIBER’s diversified global operations in 18 countries on 4 continents have served as a strategic bulwark in mitigating the global economic recession.  With an average of 20 years of industry experience, the Company’s seasoned management team continues to effectively provide the leadership required during this challenging economic environment.  Well versed in difficult decision making, the company has weathered the economic storm by lowering SG&A costs until recovery signs are evident, while at the same time taking advantage of opportunities to add quality employees that become available during these periods.

 

“Our third quarter results continued to reflect the global economic malaise.  However, beginning in September we have seen more customer activity, stable headcounts and new contracts, particularly in the U.S. Federal Government Division and our international operations,” said Mac Slingerlend, CIBER’s President and Chief Executive Officer.  “Cash collections were strong in 3Q09 and our new 3-year bank facility is a solid underpinning to our financial resources.  Although we were frustrated to settle a non-substantiated legal action in late September, we assured ourselves of no greater negative consequences.  We are now focused on sequential quarterly improvements in overall business levels.”

 



 

Sequential Quarterly Results:  3Q09 as Compared to 2Q09

 

·                  Revenue of $256.4 million for 3Q09 compares to $260.6 million for 2Q09.  This 1.6% sequential decrease primarily reflects seasonal holidays and vacations.

 

·                  Operating income (net of $2.5 million of one-time charges; discussed below) of $7.0 million for 3Q09 compares to $7.5 million for 2Q09.  Prior to the one-time charges, operating income actually increased by approximately $2.0 million, or 27%, from the second quarter to the third quarter.

 

·                  3Q09 GAAP EPS of $0.05 per share, net of $0.03 per share of non recurring charges, compares to $0.07 per share for 2Q09.  Before the charges, the $0.01 per share sequential improvement reflects the cost savings undertaken by the Company and improved results in the U.S. ERP and European Divisions.

 

·                  EBITDA for 3Q09 of $12.3 million, or $14.8 million prior to the non recurring charges, compares to $13.0 million for 2Q09.

 

Non Recurring 3Q09 Charges

 

·                  The Company was compelled to settle a lawsuit in the quarter that had previously been considered not meaningful.  The 2½ year old suit from a 5 year ago matter was expected to be dismissed against the Company.  The Company’s request to be released from all charges only achieved a partial dismissal.  In mid-September, the trial commenced.  Given the sizable sums sought by the Plaintiffs and joint liability of the multiple defendants, the Company concluded it was appropriate to avoid any further inclusion in this matter.  The Company paid $2-2.25 million in total settlement and legal fees to be dismissed, admitting no fault.

 

·                  In securing a new, improved three-year credit facility, the Company accelerated unamortized fees and costs of the prior facility by approximately $0.3 million.

 

On a combined basis these two non recurring charges adversely impacted Q309 by approximately $0.03 per share.

 

3Q09 Operational Highlights

 

Custom Solutions Division (Including Indian Operations)

 

·                  Efforts to pursue larger wins by combining teams from branch offices and Strategic Practices are now a more organized focus.

 

·                  Most new IT spending has been business intelligence and maintenance oriented, with new development generally on hold at corporate clients.  That said, a few clients have commented that they are just now commencing new development.

 

·                  Indian operations continue to build headcount and utilization.

 

IT Outsourcing Division

 

·                  Vibrancy in our longer-term contracts IT Outsourcing Division continued in the quarter, with the signing of a new $48.0 million, 6-year contract, in addition to several smaller wins.  The large contract covers full IT operations and service desk solutions for a major quasi-governmental

 

2



 

financial institution.  This Division also shared in wins in Europe during the quarter and early in the fourth quarter.

 

U.S. ERP Division

 

·                  The Oracle ERP Practice remains stable, with public sector clients more active now than higher education work.

 

·                  The U.S. SAP Practice had smaller wins in the quarter, but has a sizeable, diversified pipeline and it is kicking-off joint lead activities with specific verticals with its SAP partnership.

 

·                  Our Lawson Practice remains positive in their healthcare and public sector verticals pipeline.

 

Federal Government Division

 

·                  After a slow contract start to the third quarter, this Division finished the quarter with a flurry, which continued into October.

 

·                  Renewals, recompetes and extensions support this revenue base while incremental prime contractor wins are being sought.

 

European Division

 

·                  The July-August summer holiday combination was a greater challenge in 2009, as utilization levels were already under greater pressure.  However, beginning September, utilization improved meaningfully.

 

·                  Wins in Norway, Germany and the UK led the quarterly activity, with European IT Outsourcing wins commencing in September and the current quarter.

 

Eastern Asia & Pacific Operations

 

·                  Australia/New Zealand operations remained profitable while material projects continued to be pipeline-oriented.

 

·                  China operations saw greater offshore support activity for European and U.S. customers as it builds its domestic base.

 

Balance Sheet Highlights (September 30, 2009)

 

·                  In August, the Company completed its refinancing of an intermediate term credit support with a new three-year, $155 million facility led by Bank of America, a new lender to our lender group.  The syndicated bank group included all of the former participants, except the agent, plus an additional bank.  The new facility extended the maturity and is more flexible in its covenant structure.

 

·                  Cash was $56.2 million and long-term debt was $92.9 million.

 

·                  DSOs for services were 65 days, a one day sequential improvement.

 

Bookings Data

 

Bookings for the third quarter were $265 million, representing a 1.1:1 book-to-bill ratio.

 

3



 

Outlook

 

The Company currently believes that the fourth quarter will be sequentially better than the September quarter, and now anticipates 2009 fiscal revenue of $1.035-1.040 billion and, net of the current quarter’s $0.03/share nonrecurring charges, fiscal GAAP EPS of $0.25-0.26/share.

 

Conference Call and Webcast

 

A webcast to discuss the Company’s financial results and outlook will be held at 11:00 a.m. EST on Tuesday, October 27, 2009 and may be heard live by visiting the Investor Relations portion of the Company website at www.ciber.com/cbr/.  To participate in the call, dial 877-941-0843 within the United States, and 480-629-9644 internationally, using the conference ID number 4170518.  A replay of the conference call will be available for 30 days by dialing 800-406-7325 within the United States, and 303-590-3030 internationally, using the ID number 4170518.  The replay will also be available on CIBER’s website.

 

About CIBER, Inc.

 

CIBER, Inc. (NYSE: CBR) is a pure-play international IT outsourcing and software implementation and integration consultancy with superior value-priced services and reliable delivery for both private and government sector clients. CIBER’s services are offered globally on a project- or strategic-staffing basis, in both custom and enterprise resource planning (ERP) package environments, and across all technology platforms, operating systems and infrastructures. Founded in 1974 and headquartered in Greenwood Village, Colo., CIBER now serves client businesses from over 40 U.S. offices, 25 European offices and seven offices in Asia/Pacific. Operating in 18 countries, with more than 8,500 employees and annual revenue of $1.1 billion, CIBER and its IT specialists continuously build and upgrade clients’ systems to “competitive advantage status.”  CIBER is included in the Russell 2000 Index and the S&P Small Cap 600 Index. CIBER, the Reliable Global IT Services Partner.  www.ciber.com.

 

Forward-Looking and Cautionary Statements

 

Statements contained in this release may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995.  These statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially, as discussed in the Company’s filings with the Securities and Exchange Commission.  CIBER undertakes neither intention nor obligation to publicly update or revise any forward-looking statements.  CIBER and the CIBER logo are trademarks or registered trademarks of CIBER, Inc.  Copyright© 2009.

 

4



 

CIBER, Inc. and Subsidiaries

Condensed Consolidated Statements of Operations

(Unaudited)

 

 

 

Three Months Ended
Sept. 30,

 

Nine Months Ended
Sept. 30,

 

In thousands, except per share data

 

2008

 

2009

 

2008

 

2009

 

Consulting services

 

$

286,004

 

$

245,113

 

$

867,484

 

$

743,170

 

Other revenue

 

13,962

 

11,254

 

44,525

 

32,276

 

Total revenue

 

299,966

 

256,367

 

912,009

 

775,446

 

 

 

 

 

 

 

 

 

 

 

Cost of consulting services

 

209,515

 

184,028

 

632,811

 

559,121

 

Cost of other revenue

 

8,170

 

7,382

 

28,850

 

20,557

 

Selling, general and administrative expenses

 

67,464

 

56,417

 

200,000

 

169,879

 

Amortization of intangible assets

 

1,604

 

1,506

 

4,823

 

4,371

 

Operating income

 

13,213

 

7,034

 

45,525

 

21,518

 

Other expense, net

 

2,778

 

2,074

 

11,510

 

2,930

 

Income before income taxes

 

10,435

 

4,960

 

34,015

 

18,588

 

Income tax expense

 

3,003

 

1,401

 

11,844

 

6,023

 

Consolidated net income

 

7,432

 

3,559

 

22,171

 

12,565

 

Net income noncontrolling interests

 

197

 

54

 

824

 

139

 

Net income attributable to CIBER, Inc.

 

$

7,235

 

$

3,505

 

$

21,347

 

$

12,426

 

 

 

 

 

 

 

 

 

 

 

Earnings per share – diluted

 

$

0.12

 

$

0.05

 

$

0.35

 

$

0.18

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares – diluted

 

60,791

 

69,809

 

60,485

 

67,573

 

 

For the three months ended September 30, 2008 and 2009, respectively, earnings per share – basic were $0.12 and $0.05 and weighted average shares – basic were 60,032 and 69,664.

 

For the nine months ended September 30, 2008 and 2009, respectively, earnings per share – basic were $0.36 and $0.18 and weighted average shares – basic were 60,098 and 67,484.

 

5



 

CIBER, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(Unaudited)

 

In thousands

 

December 31,
2008

 

September 30,
2009

 

 

 

 

 

 

 

Assets

 

 

 

 

 

Current assets:

 

 

 

 

 

Cash and cash equivalents

 

$

48,849

 

$

56,247

 

Accounts receivable, net

 

235,066

 

216,658

 

Prepaid expenses and other current assets

 

20,633

 

24,177

 

Deferred income taxes

 

4,883

 

7,189

 

Total current assets

 

309,431

 

304,271

 

 

 

 

 

 

 

 

 

 

 

 

 

Property and equipment, net

 

27,372

 

26,710

 

Intangible assets, net

 

449,813

 

457,965

 

Other assets

 

10,904

 

13,011

 

Total assets

 

$

797,520

 

$

801,957

 

 

 

 

 

 

 

Liabilities and Shareholders’ Equity

 

 

 

 

 

Current liabilities:

 

 

 

 

 

Accounts payable

 

$

35,373

 

$

27,301

 

Accrued compensation and related liabilities

 

62,437

 

66,275

 

Other accrued expenses and liabilities

 

44,514

 

63,656

 

Income taxes payable

 

1,874

 

11,299

 

Total current liabilities

 

144,198

 

168,531

 

 

 

 

 

 

 

Long-term bank debt

 

165,710

 

92,865

 

Deferred income taxes

 

34,288

 

36,400

 

Total liabilities

 

344,196

 

297,796

 

 

 

 

 

 

 

Total shareholders’ equity

 

453,324

 

504,161

 

Total liabilities and shareholders’ equity

 

$

797,520

 

$

801,957

 

 

6



 

CIBER, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(Unaudited)

 

 

 

Nine Months Ended
September 30,

 

In thousands

 

2008

 

2009

 

 

 

 

 

 

 

Operating activities:

 

 

 

 

 

Net income

 

$

22,171

 

$

12,565

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

 

Depreciation

 

9,513

 

9,007

 

Amortization of intangible assets

 

4,823

 

4,371

 

Other, net

 

27,492

 

35,399

 

Net cash provided by operating activities

 

63,999

 

61,342

 

 

 

 

 

 

 

Investing activities:

 

 

 

 

 

Acquisitions, net of cash acquired

 

(7,790

)

(4,258

)

Purchases of property and equipment, net

 

(10,837

)

(7,960

)

Other

 

233

 

 

Net cash used in investing activities

 

(18,394

)

(12,218

)

 

 

 

 

 

 

Financing activities:

 

 

 

 

 

Employee stock purchases and options exercised

 

3,559

 

1,871

 

Purchases of treasury stock

 

(7,519

)

(3,877

)

Borrowings (payments) on long-term bank debt, net

 

42,155

 

(63,882

)

Retirement of debentures

 

(68,779

)

 

Sales of common stock

 

 

23,220

 

Other, net

 

(5,558

)

(3,687

)

Net cash used in financing activities

 

(36,142

)

(46,355

)

 

 

 

 

 

 

Effect of foreign exchange rate changes on cash

 

(1,839

)

4,629

 

Net increase in cash and cash equivalents

 

7,624

 

7,398

 

Cash and cash equivalents, beginning of period

 

31,717

 

48,849

 

Cash and cash equivalents, end of period

 

$

39,341

 

$

56,247

 

 

7



 

Selected Financial Information

Unaudited Reconciliation of Non-GAAP and Segment Financial Measures

 

I.                  Reconciliation of Revenue Growth Components ($ in millions)

 

Sequential Three Months Ended

 

Divisions

 

June 30,
2009

 

Organic

 

Acquired

 

Foreign
Exchange

 

Total

 

Sept. 30,
2009

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Custom Sols & ITO

 

$

113.1

 

-5.8

%

%

%

-5.8

%

$

106.5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. ERP

 

32.3

 

-3.1

 

 

 

-3.1

 

31.3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Federal

 

29.9

 

-2.7

 

 

 

-2.7

 

29.1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Europe

 

85.3

 

-1.3

 

 

6.2

 

4.9

 

89.5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

260.6

 

-3.6

%

%

2.0

%

-1.6

%

$

256.4

 

 

Three Months Ended

 

Divisions

 

Sept. 30,
2008

 

Organic

 

Acquired

 

Foreign
Exchange

 

Total

 

Sept. 30,
2009

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Custom Sols & ITO

 

$

133.2

 

-21.0

%

1.0

%

%

-20.0

%

$

106.5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. ERP

 

30.1

 

4.0

 

 

 

4.0

 

31.3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Federal

 

31.4

 

-7.3

 

 

 

-7.3

 

29.1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Europe

 

105.3

 

-7.3

 

 

-7.7

 

-15.0

 

89.5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

300.0

 

-12.2

%

0.4

%

-2.7

%

-14.5

%

$

256.4

 

 

Nine Months Ended

 

Divisions

 

Sept. 30,
2008

 

Organic

 

Acquired

 

Foreign
Exchange

 

Total

 

Sept. 30,
2009

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Custom Sols & ITO

 

$

401.2

 

-17.0

%

0.9

%

%

-16.1

%

$

336.6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. ERP

 

93.1

 

-0.2

 

 

 

-0.2

 

92.9

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Federal

 

96.7

 

-9.1

 

 

 

-9.1

 

87.9

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Europe

 

321.0

 

-3.4

 

0.2

 

-16.4

 

-19.6

 

258.0

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

912.0

 

-9.7

%

0.5

%

-5.8

%

-15.0

%

$

775.4

 

 

8



 

II.            EBITDA Reconciliation to Net Income ($ in thousands)

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

 

Sept. 30,
2008

 

June 30,
2009

 

Sept. 30,
2009

 

Sept. 30,
2008

 

Sept. 30,
2009

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income Attributable to CIBER

 

$

7,235

 

$

4,656

 

$

3,505

 

$

21,347

 

$

12,426

 

Net Income Noncontrolling Interest

 

197

 

53

 

54

 

824

 

139

 

Consolidated Net Income

 

7,432

 

4,709

 

3,559

 

22,171

 

12,565

 

Income Tax

 

3,003

 

2,206

 

1,401

 

11,844

 

6,023

 

Pre-Tax Income

 

10,435

 

6,915

 

4,960

 

34,015

 

18,588

 

Other Expense, net

 

2,778

 

553

 

2,074

 

11,510

 

2,930

 

Operating Income

 

13,213

 

7,468

 

7,034

 

45,525

 

21,518

 

Share Based Comp.

 

977

 

1,093

 

817

 

2,537

 

2,986

 

Amortization

 

1,604

 

1,457

 

1,506

 

4,823

 

4,371

 

Depreciation

 

3,253

 

3,000

 

2,982

 

9,513

 

9,007

 

EBITDA

 

$

19,047

 

$

13,018

 

$

12,339

 

$

62,398

 

$

37,882

 

 

9



 

III.           Segment Operating Results Analysis

 

Operating Results Analysis

($ in millions)

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

 

Sept. 30, 2008

 

Sept. 30, 2009

 

Sept. 30, 2008

 

Sept. 30, 2009

 

 

 

$

 

%

 

$

 

%

 

$

 

%

 

$

 

%

 

Revenue

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Custom Sols & ITO (1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial/ITO

 

$

107.3

 

36

 

$

83.9

 

33

 

$

308.5

 

34

 

$

267.1

 

35

 

State & Local

 

25.9

 

8

 

22.6

 

9

 

92.7

 

10

 

69.5

 

9

 

Sub

 

133.2

 

44

 

106.5

 

42

 

401.2

 

44

 

336.6

 

44

 

U.S. ERP (2)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

 

16.4

 

5

 

11.9

 

5

 

41.9

 

5

 

37.2

 

5

 

State & Local

 

13.7

 

5

 

19.3

 

7

 

51.2

 

5

 

55.7

 

7

 

Sub

 

30.1

 

10

 

31.3

 

12

 

93.1

 

10

 

92.9

 

12

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Federal

 

31.4

 

11

 

29.1

 

11

 

96.7

 

11

 

87.9

 

11

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Europe (3)

 

105.3

 

35

 

89.5

 

35

 

321.0

 

35

 

258.0

 

33

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

$

300.0

 

100

%

$

256.4

 

100

%

$

912.0

 

100

%

$

775.4

 

100

%

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

 

Sept. 30, 2008

 

Sept. 30, 2009

 

Sept. 30, 2008

 

Sept. 30, 2009

 

 

 

$

 

%

 

$

 

%

 

$

 

%

 

$

 

%

 

EBITA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Custom Sols & ITO (1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial/ITO

 

 

 

 

 

 

 

 

 

 

 

 

 

State & Local

 

 

 

 

 

 

 

 

 

 

 

 

 

Sub

 

$

13.5

 

10

 

$

7.0

 

7

 

$

40.3

 

10

 

$

22.5

 

7

 

U.S. ERP (2)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

 

 

 

 

 

 

 

 

 

 

 

 

 

State & Local

 

 

 

 

 

 

 

 

 

 

 

 

 

Sub

 

(1.7

)

(6

)

2.8

 

9

 

0.1

 

0

 

6.4

 

7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Federal

 

2.8

 

9

 

1.5

 

5

 

7.1

 

7

 

4.9

 

5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Europe (3)

 

7.3

 

7

 

4.8

 

5

 

23.7

 

8

 

13.2

 

5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate

 

(7.1

)

(2

)

(7.6

)

(3

)

(20.9

)

(2

)

(21.1

)

(3

)

EBITA

 

14.8

 

5

 

8.5

 

3

 

50.3

 

6

 

25.9

 

3

 

Amortization

 

(1.6

)

(1

)

1.5

 

 

(4.8

)

(1

)

4.4

 

 

Operating Income

 

$

13.2

 

4

%

$

7.0

 

3

%

$

45.5

 

5

%

$

21.5

 

3

%

 


Note:      India operations are in Custom Solutions and Asia Pacific operations are in Europe; Custom Solutions also includes domestic eliminations.

(1)   These Divisions have been combined and prior revenue partially reclassified, accordingly, margins cannot be accurately separated.

(2)   This activity has always been operated together; highlighting State & Local revenue will assist the overall view of CIBER’s public sector emphasis.

(3)   Public sector business also exists in the European Division, both national and local; it is approximately 5% of these revenues.

 

###

 

10