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8-K - 8-K - ANALYSTS INTERNATIONAL CORPa12-5501_18k.htm

Exhibit 99.1

 

GRAPHIC

 

Media Contact:

Marne Oberg

Analysts International Corporation

952.838.2867

moberg@analysts.com

 

Analysts International Corporation Reports Fourth Quarter and
Fiscal Year 2011 Financial Results

 

·    Revenue was $27.1 million, a 6.9% increase from the 2010 fourth quarter

 

·    Net income was $1.3 million, a $0.3 million increase from the 2010 fourth quarter

 

·    Gross margin rates remained constant at 24.8% for the 2011 and 2010 fourth quarters

 

·    Selling, administrative and other operating costs represented 20.1% of revenue for the 2011 fourth quarter, a 1.0% decrease from the 2010 fourth quarter

 

·    $5.1 million in cash with no amounts outstanding under the Company’s credit facility

 

·    Company amends credit facility resulting in increased availability

 

MINNEAPOLIS — February 23, 2012 — Analysts International Corporation (AIC) (Nasdaq: ANLY), an information technology services company, today announced financial results for the fourth quarter and fiscal year 2011 which ended on December 31, 2011.

 

AIC reported fourth quarter revenue of $27.1 million as compared to 2010 fourth quarter revenue of $25.3 million. AIC reported a 2011 fourth quarter net income of $1.3 million, or $0.25 per share, as compared to a 2010 fourth quarter net income of $0.9 million, or $0.19 per share.

 

For fiscal year 2011, AIC reported revenue of $109.1 million compared to $106.7 million in fiscal year 2010. The net income for fiscal 2011 was $3.3 million, or $0.66 per share, compared to a net loss of $0.5 million, or $0.10 per share, in the prior year. The fiscal 2011 net income included restructuring charges related to severance and office closures of $0.8 million, or $0.15 per share. Excluding these charges, the Company’s net income was $4.1 million in fiscal 2011, or $0.81 per share. The fiscal 2010 net loss included a net reversal of certain restructuring obligations previously recorded of $0.3 million, or $0.06 per share. Excluding these charges, the Company’s net loss in fiscal 2010 was $0.8 million, or $0.16 per share.

 



 

“2011 marked a significant turning point for AIC,” said Brittany McKinney, President and CEO. “We achieved annual profitability, stabilized revenues and made the investments necessary to drive future growth.

 

“Our market opportunity remains strong with solid demand for IT services,” added McKinney. “We believe AIC is ideally positioned to capitalize on that opportunity and will continue to invest in positioning the Company as a leader in the industry.”

 

2011 Fourth Quarter and Fiscal Year Review

 

Our revenues increased $1.8 million, or 6.9%, in the fourth quarter of 2011 compared to the fourth quarter of 2010, and by $2.4 million, or 2.3%, for fiscal year 2011, when compared to fiscal year 2010.  Adjusting for the exit from non-core lines of business in 2010, revenue increased 2.7% for fiscal year 2011. There were 62 billing days in the 2011 fourth quarter as compared to 61 billing days in the 2010 fourth quarter.

 

In the fourth quarter of 2011, gross margins were $6.7 million, or 24.8% of revenue, as compared to $6.3 million, or 24.8% of revenue in the fourth quarter of 2010. Gross margins were $26.4 million, or 24.2% of revenue, for the fiscal year 2011, compared to $23.8 million, or 22.3% of revenue, for fiscal year 2010. The increase in gross margins as a percent of revenue primarily reflects the impact of implementing our strategy of evolving our mix of business and a decrease in our benefit costs.

 

Selling, general and other administrative expenses represented 20.1% of revenue for the fourth quarter of 2011, as compared to 21.1% for the fourth quarter of 2010, and 20.4% for fiscal year 2011, as compared to 23.0% for fiscal year 2010. The decrease in our SG&A expense is primarily the result of lower benefit costs and previously implemented general expense reductions.

 

We used cash from operations of $0.1 million in the fourth quarter of 2011 compared to $0.3 million in the fourth quarter of 2010. For fiscal year 2011, we generated cash from operations of $2.4 million compared to $0.6 million for fiscal year 2010. As of December 31, 2011, we had a cash balance of $5.1 million and no borrowings from our $15 million credit facility.

 

Amended Credit Facility

 

On February 22, 2012, the Company amended its $15 million credit facility agreement with Wells Fargo Bank, National Association. The amended agreement increases borrowing availability and restructures some of the covenant-related terms to better reflect the current business.

 

Fourth Quarter and Fiscal Year 2011 Conference Call

 

AIC will host a conference call on Friday, February 24 at 10 a.m. CT to discuss the fourth quarter and fiscal year 2011 financial results. Participants may access the call by dialing 1.888.397.5338, or

 



 

1.719.457.2617 for international callers, and entering the conference ID number 1308764. Live audio of the conference may also be accessed via the Internet at www.analysts.com, where it will be archived for 90 days following the completion of the conference call. Interested parties can also hear a replay of the call from 1 p.m. CT on February 24, 2012, to 10:59 p.m. CT on March 1, 2012, by calling 1.888.203.1112, or 1.719.457.0820 for international callers, and using access code 1308764.

 

About Analysts International Corporation

 

Analysts International Corporation (AIC) is an IT services firm fully dedicated to the success and satisfaction of its clients. From IT staffing to project-based solutions, AIC provides a broad range of services designed to help businesses and government agencies drive value, control costs and deliver on the promise of a more efficient and productive enterprise. The Company offers a flexible, collaborative approach; clear industry perspective; and the breadth, scale and experience to deliver results. For more information, visit www.analysts.com.

 

Cautionary Statement for the Purpose of Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995

 

This press release contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Statements made in this press release (or during the conference call referred to herein) by the Company, its President and CEO Brittany McKinney or its CFO William Wolff, regarding, for instance: Current expectations as to future financial performance and the Company’s ability to execute against its strategic plan, increase revenues, maintain profitability, achieve anticipated gross profit margin rates, build cash, control costs and return value to its shareholders, are forward-looking statements. These forward-looking statements are based on current information, which we have assessed, which by its nature is dynamic and subject to rapid and even abrupt changes. As such, results may differ materially in response to a change in this information. Forward-looking statements include statements expressing the intent, belief or current expectations of AIC and members of our management team and involve certain risks and uncertainties, including (i) the risk that management may not fully or successfully implement its business plan or maintain profitability in the future; (ii) the risk that AIC will not be able to realize the benefits of its investments or exploit other opportunities of the business in a timely manner or on favorable terms; (iii) prevailing market conditions in the IT services industry, including intense competition for billable technical personnel at competitive rates, strong pricing pressures from many of our largest clients and difficulty in identifying, attracting and retaining qualified billable technical personnel; (iv) potentially incorrect assumptions by management with respect to the financial effect of prior cost reduction initiatives and current strategic decisions; and (v) other economic, business, market, financial, competitive and/or regulatory factors affecting AIC’s business generally, including those set forth in AIC’s filings with the SEC. You are cautioned not to place undue reliance on these or any forward-looking statements, which speak only as of the date of this press release and conference call. Such forward-looking statements should be read in conjunction with the Company’s filings with the SEC. AIC assumes no responsibility to update the forward-looking statements contained in this release.

 



 

Analysts International Corporation

Consolidated Statements of Operations

 

 

 

Three Months Ended

 

Twelve Months Ended

 

(In thousands except per share amounts)

 

Dec. 31, 2011

 

Jan. 1, 2011

 

Dec. 31, 2011

 

Jan. 1, 2011

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

$

27,095

 

$

 25,341

 

$

109,118

 

$

 106,688

 

Cost of revenues

 

20,385

 

19,055

 

82,734

 

82,911

 

Gross profit

 

6,710

 

6,286

 

26,384

 

23,777

 

 

 

 

 

 

 

 

 

 

 

Selling, administrative and other operating costs

 

5,434

 

5,345

 

22,279

 

24,554

 

Restructuring costs and other severance related costs

 

 

 

769

 

(300

)

Total operating expenses

 

5,434

 

5,345

 

23,048

 

24,254

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss)

 

1,276

 

941

 

3,336

 

(477

)

 

 

 

 

 

 

 

 

 

 

Non-operating income

 

 

 

 

14

 

Interest expense

 

 

(2

)

 

(13

)

 

 

 

 

 

 

 

 

 

 

Income (loss) before income taxes

 

1,276

 

939

 

3,336

 

(476

)

 

 

 

 

 

 

 

 

 

 

Income tax expense (benefit)

 

15

 

(1

)

42

 

4

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

$

1,261

 

$

 940

 

$

3,294

 

$

 (480

)

 

 

 

 

 

 

 

 

 

 

Per common share:

 

 

 

 

 

 

 

 

 

Basic income (loss)

 

$

 0.25

 

$

 0.19

 

$

 0.66

 

$

 (0.10

)

Diluted income (loss)

 

$

 0.25

 

$

 0.19

 

$

 0.66

 

$

 (0.10

)

 

 

 

 

 

 

 

 

 

 

Weighted-average shares outstanding:

 

 

 

 

 

 

 

 

 

Basic

 

5,023

 

4,986

 

5,012

 

4,986

 

Diluted

 

5,054

 

4,987

 

5,027

 

4,986

 

 


 


 

Analysts International Corporation

Condensed Consolidated Balance Sheets

 

 

 

December 31,

 

January 1,

 

(In thousands)

 

2011

 

2011

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

Current assets:

 

 

 

 

 

Cash and cash equivalents

 

$

5,135

 

$

4,328

 

Accounts receivable, less allowance for doubtful accounts

 

18,016

 

17,425

 

Other current assets

 

489

 

643

 

Total current assets

 

23,640

 

22,396

 

 

 

 

 

 

 

Property and equipment, net

 

2,095

 

784

 

Other assets, net

 

457

 

432

 

Total assets

 

$

26,192

 

$

23,612

 

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

Accounts payable

 

$

3,847

 

$

4,261

 

Salaries and benefits

 

2,078

 

2,189

 

Deferred revenue

 

285

 

359

 

Deferred compensation

 

136

 

181

 

Restructuring accrual

 

442

 

339

 

Other current liabilities

 

664

 

694

 

Total current liabilities

 

7,452

 

8,023

 

 

 

 

 

 

 

Non-current liabilities:

 

 

 

 

 

Deferred compensation

 

379

 

901

 

Restructuring accrual

 

28

 

167

 

Other long-term liabilities

 

 

52

 

 

 

 

 

 

 

Shareholders’ equity

 

18,333

 

14,469

 

Total liabilities and shareholders’ equity

 

$

26,192

 

$

23,612

 

 



 

Analysts International Corporation

Reconciliation of non-GAAP Financial Measures

 

 

 

Three Months Ended

 

Twelve Months Ended

 

 

 

December 31,

 

January 1,

 

December 31,

 

January 1,

 

(In thousands)

 

2011

 

2011

 

2011

 

2011

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) as reported

 

$

1,261

 

$

940

 

$

3,294

 

$

(480

)

Plus:

 

 

 

 

 

 

 

 

 

Restructuring costs and other severance related costs

 

 

 

769

 

(300

)

Loss on asset sales

 

 

 

 

48

 

 

 

 

 

 

 

 

 

 

 

Income (loss) before other reconciling items

 

1,261

 

940

 

4,063

 

(732

)

 

 

 

 

 

 

 

 

 

 

Stock based compensation expense

 

112

 

34

 

531

 

1

 

Depreciation

 

168

 

183

 

632

 

860

 

 

 

 

 

 

 

 

 

 

 

Net interest and non-operating expense (income)

 

 

2

 

 

(1

)

Income tax expense (benefit)

 

15

 

(1

)

42

 

4

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

 

$

1,556

 

$

1,158

 

$

5,268

 

$

132

 

 


* Non-GAAP Financial Information

 

In evaluating the Company’s business, the Company’s management considers and uses Adjusted EBITDA as a supplemental measure of operating performance. Adjusted EBITDA refers to a financial measure that the Company defines as net income (loss) excluding interest, taxes, depreciation, amortization, share-based compensation, special charges and other gains and losses that are not related to the Company’s operations. This measure is an essential component of the Company’s internal planning process because it facilitates period-to-period comparisons of the Company’s operating performance by eliminating potential differences in net income (loss) caused by the existence and timing of certain non-cash items, special charges and other gains and losses. This measure should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for or superior to GAAP results. The non-GAAP financial measure included in this press release has been reconciled to the nearest GAAP measure.