Softchoice Announces First Quarter Earnings
- Gross profit grows 11.3 percent - Gross margins up 130 basis points - U.S. revenues increase 28 percent
(firmenpresse) - TORONTO, ONTARIO -- (Marketwire) -- 05/14/12 -- Softchoice Corporation (TSX: SO), a North American provider of technology solutions and services, today reported earnings for the first quarter of 2012.
For the three month-period ended March 31st, 2012, Softchoice reported net earnings of US$5.1 million compared to net earnings of $5.2 million for the same period the year prior. Eliminating the impact of foreign exchange gains and losses, adjusted net earnings(i) amounted to US$4.4 million, or US$0.22 per share (basic and fully diluted) compared to US$4.2 million, or US$0.21 per share (basic and fully diluted) recorded for the same period the year prior, representing an increase of 5.6 percent. The lower than anticipated earnings growth is attributed to unexpected delays in contract negotiations between the Canadian federal government and key software publishers.
Softchoice's first quarter net revenues increased 3.8 percent to US$259.1 million compared to US$249.7 million reported for the same period in 2011. Net revenues from the company's U.S. operations demonstrated particularly strong growth, increasing by 28 percent year-over-year.
"Despite the challenges in Canada, the ongoing integration of the business of UNIS LUMIN, and the investments we're making in the cloud to drive our future growth, we continued to deliver earnings growth and are well-positioned to improve upon our performance for the balance of the year," said David MacDonald, President and CEO of Softchoice. "I am pleased to say that our U.S. operations exceeded expectations, our expanded coverage of the small and medium-size business segment is fueling gains in our Microsoft market share and sales of enterprise software, server, storage and networking solutions continue to post double-digit growth."
Revenues from the company's professional services business grew by 50 percent in the period reflecting the impact of the acquisition of the business of UNIS LUMIN, while sales of enterprise software, servers, storage and networking increased by 17 percent. Sales of Microsoft grew 8 percent compared to the same quarter the year prior, while total Microsoft revenue, including imputed revenue(ii), grew by 22 percent.
"We have made great progress with the integration of the business of UNIS LUMIN as we strengthen our ability to meet the growing demand for Managed Services as well as expertise in the design and delivery of advanced networking solutions," added Mr. MacDonald. "While still early, we are already realizing some of the cross-selling synergies we anticipated as we begin extending the full-value of our combined capabilities to legacy Softchoice and UNIS LUMIN customers."
At the end of the quarter, cash on hand was US$42.1 million, with cash flow from operations of $10.5 million, and total debt of nil.
Highlights
Softchoice AGM and 2012 First Quarter Earnings Call
Softchoice will host its Annual General Meeting tomorrow, Tuesday May 15, 2012 at 10:00 a.m. at the Westin Harbour Castle Hotel in Pier 7 & 8. The hotel is located at 1 Harbour Square in downtown Toronto. The meeting will run from 10:00 am to 12:00 pm. Presenters will include Bill Linton, Chairman of the Softchoice Board, and President and CEO, David MacDonald.
The quarterly earnings conference call will take place the same day at 8:00 a.m. The conference call will begin with a brief presentation followed by a question and answer period.
Participant Dial in Numbers:
416 800 1066 - North American Toll
866 212 4491 - North American Toll Free
Webcast URL:
To ensure participation, please dial in at least 10 minutes prior to the start of the conference at 8:00 a.m. EDT.
For those unable to attend the call, a link will be made available on the Softchoice website to an archived web and audio version on May 16th, 2012.
About Softchoice
As a leading North American provider of technology solutions and services, Softchoice combines the efficiency and reliability of a national IT supplier with the personal touch and technical expertise of a local solutions provider. Softchoice's holistic approach to technology includes solution design, implementation and asset management services, as well as access to one of the most comprehensive and cost-effective technology distribution networks in North America. With over 1,100 employees located in more than 40 branch offices, Softchoice manages the technology needs of thousands of corporate and public sector organizations across the United States and Canada.
Softchoice stock is listed on the Toronto Stock Exchange (TSX) under the trading symbol "SO." The common shares of Softchoice are not registered under the U.S. Securities Act of 1933 and are not publicly traded in the United States.
Forward-Looking Statements
This press release contains forward-looking statements that involve risks and uncertainties. These forward-looking statements relate to expectations, intentions and plans contained in this press release that are not historical fact. When used in this press release, the words "anticipate", "expect", "will" and similar expressions generally identify forward-looking statements. These statements reflect our current expectations and are subject to a number of risks and uncertainties including, but not limited to, change in technology and general market conditions, many of which are set out or incorporated by reference in the Company's latest Annual Information Form. Due to the many risks and uncertainties, Softchoice cannot assure that the forward-looking statements contained in this press release will be realized.
(i) Use of Non-GAAP Measures - Adjusted Net Earnings
Adjusted net earnings eliminate the after-tax impact related to any foreign exchange gain or loss on the cash, intercompany debt and external debt denominated in a currency other than the Company's functional currency. Adjusted net earnings highlight underlying business performance by adjusting for the impact of these currency changes.
(ii) Use of Non-GAAP Measures - Imputed Revenue
Microsoft imputed revenue is defined as the price paid by the customer to Microsoft for sales of Enterprise Agreements ("EAs") that are transacted through Softchoice sales representatives plus the gross amount billed to customers for Software Assurance ("SA") agreements.
Microsoft pays Softchoice an agency fee or commission for sales of EAs, and therefore Softchoice does not reflect the imputed revenue in the revenue line for these transactions but records only the agency fees earned within revenue. Microsoft imputed revenue allows for better comparability between fiscal periods since an increase in the product mix of EAs and SA agreements would make it appear that Softchoice is selling fewer products, when that would not be the case. Management believes that an EA often provides a more cost-effective solution for customers, particularly in the small and medium business ("SMB") market.
Other imputed revenue includes the difference between what the Company invoices customers for non-Microsoft maintenance contracts and the net amount that is reflected in the financial statements. Management believes that reporting the imputed revenue for these arrangements is helpful to investors to put the Company's trade accounts receivable and trade payables balances into context. The Company records these arrangements on a net basis, as an agent, rather than on a gross basis, as a principal in the transaction, as the services are provided primarily by third parties.
The table below shows total revenue, including imputed revenue, for the first quarter compared to the same period of the prior year.
Interim Condensed Consolidated Financial Statements
(Expressed in U.S. dollars)
SOFTCHOICE CORPORATION
Three-month periods ended March 31, 2012 and 2011
(Unaudited)
The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.
Contacts:
Media Contact: Softchoice Corporation
Eric Gardiner
Manager of Communications
416.588.9002 Ext. 2358
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Unternehmensinformation / Kurzprofil:
Datum: 15.05.2012 - 01:51 Uhr
Sprache: Deutsch
News-ID 146297
Anzahl Zeichen: 7132
contact information:
Town:
TORONTO, ONTARIO
Kategorie:
Software
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