EXHIBIT 99.1
FOR IMMEDIATE RELEASE
NASDAQ: AMSY
Investor Relations Contact:
Ronald Schillereff
703-267-5140
ronald.schillereff@ams.com
Media Relations Contact:
Anne Burt
703-267-8142
anne.burt@ams.com
AMS REPORTS Q1 2003 RESULTS
Meets Analysts’ Earnings Estimates
FAIRFAX, Va, April 22, 2003 – American Management Systems, Incorporated (NASDAQ: AMSY), a global business and IT consulting firm, today announced first quarter 2003 earnings of $6.3 million ($0.15 per diluted share) compared to $10.7 million, ($0.25 per diluted share) and $8.0 million ($0.19 per diluted share) in the first and fourth quarters of 2002, respectively.
Revenues for the first quarter 2003 were $227.0 million, compared with $251.4 million and $236.1 million for the first and fourth quarters in 2002, respectively. Approximately $4.8 million, or 53%, of the decline in revenues in the first quarter 2003 over the fourth quarter of 2002 was attributable to the sale of AMS’s Global Utilities practice in December 2002 as part of its strategy to divest non-core operations.
“We are pleased that we met guidance on earnings and EPS and that key operating metrics, such as utilization rates, are stable. However, macroeconomic and competitive conditions continue to be challenging,” Alfred T. Mockett, Chairman and CEO, stated. “We have taken and continue to take actions to aggressively address our costs while investing in business development and other programs that position us for future industry growth. Further, we will continue the previously announced stock repurchase program, which we began in March 2003, based on our belief that AMS’s stock is undervalued,” he concluded.
Conference Call
AMS will hold a conference call to review first quarter results at 5:00 p.m. Eastern Time on April 22, 2003 that will be accessible by dialing 913-981-5507. An audio replay of the call will be available from 8:00 p.m., April 22, 2003 through 12:00 midnight, April 29, 2003 by dialing 719-457-0820 and entering pass code 783074. The call may also be accessed via a live Webcast on the AMS Website atams.com. The Webcast will be available for replay through April 21, 2004.
About AMS
AMS is a global business and IT consulting firm whose customers include 44 state, local and provincial governments, a majority of federal agencies, and hundreds of companies in the Fortune 500. With deep industry experience and technical know-how in all levels of government and throughout the private sector, the company delivers results that measurably improve business performance and the relationship between an organization and its customers. Founded in 1970, AMS is headquartered in Fairfax, Va. with 50 offices worldwide. The company is traded on the Nasdaq National Market under the symbol AMSY. For detailed information about AMS, visit ams.com.
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This release may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management’s current expectations and are subject to risks, uncertainty and changes in circumstances. Actual results may vary materially from the expectations contained in the forward-looking statements. All statements contained in this release that are not clearly historical in nature are forward-looking, and the words “anticipate,” “believe,” “expect,” “estimate,” “intends” and similar expressions are generally intended to identify forward-looking statements. The following factors, among others, could cause actual results to differ materially from those described in the forward-looking statements: risks in project delivery and staffing, risk of revenues not being realized when expected, risk of increased competition in the markets, and the effects of economic uncertainty on client expenditures as well as other factors described in AMS’s Annual Report on Form 10-K for the year ended 2002. The company specifically disclaims any obligation to update these forward-looking statements. These forward-looking statements should not be relied upon as representing the company’s (estimates or) views as of any subsequent date.
American Management Systems, Incorporated
CONSOLIDATED CONDENSED INCOME STATEMENTS
Unaudited
(In thousands, except per share data)
For the Quarter | |||||||||
Ended March 31, | |||||||||
2003 | 2002 | ||||||||
REVENUES | $ | 226,972 | $ | 251,430 | |||||
EXPENSES(1): | |||||||||
Cost of Revenues | 135,047 | 147,587 | |||||||
Selling, General and Administrative | 77,582 | 79,164 | |||||||
Research and Development | 3,330 | 5,958 | |||||||
INCOME FROM OPERATIONS | 11,013 | 18,721 | |||||||
OTHER (INCOME) EXPENSE, NET: | |||||||||
Interest Expense | 509 | 797 | |||||||
Other Income | (103 | ) | (249 | ) | |||||
406 | 548 | ||||||||
INCOME BEFORE INCOME TAXES | 10,607 | 18,173 | |||||||
INCOME TAXES | 4,349 | 7,451 | |||||||
NET INCOME | $ | 6,258 | $ | 10,722 | |||||
WEIGHTED AVERAGE SHARES OUTSTANDING | 42,362 | 41,780 | |||||||
BASIC EARNINGS PER SHARE | $ | 0.15 | $ | 0.26 | |||||
WEIGHTED AVERAGE SHARES AND EQUIVALENTS | 42,622 | 42,373 | |||||||
DILUTED EARNINGS PER SHARE | $ | 0.15 | $ | 0.25 | |||||
1 Certain amounts from prior year have been reclassified for comparative purposes
1
American Management Systems, Incorporated
CONSOLIDATED REVENUES BY MARKET
(In thousands)
For the Quarter | For the Quarter | |||||||||||||||
Ended March 31, | Ended December 31, | |||||||||||||||
2003 | 2002 | 2002 | 2001 | |||||||||||||
Federal Government Agencies | $ | 85,923 | $ | 83,675 | $ | 88,524 | $ | 78,156 | ||||||||
State and Local Governments and Education | 61,382 | 71,525 | 62,560 | 71,911 | ||||||||||||
Communications, Media and Entertainment | 42,597 | 53,202 | 41,438 | 64,623 | ||||||||||||
Financial Services Institutions | 30,268 | 30,780 | 31,631 | 30,355 | ||||||||||||
Other Corporate Clients | 6,802 | 12,248 | 11,935 | 14,886 | ||||||||||||
Total Revenues | $ | 226,972 | $ | 251,430 | $ | 236,088 | $ | 259,931 | ||||||||
American Management Systems, Incorporated
CONSOLIDATED CONDENSED BALANCE SHEETS
(In thousands)
3/31/2003 | |||||||||||
ASSETS | (Unaudited) | 12/31/2002 | |||||||||
CURRENT ASSETS: | |||||||||||
Cash and Cash Equivalents | $ | 115,266 | $ | 136,191 | |||||||
Accounts Receivable, Net | 219,903 | 212,098 | |||||||||
Prepaid Expenses and Other Current Assets | 34,704 | 35,126 | |||||||||
Total Current Assets | 369,873 | 383,415 | |||||||||
NONCURRENT ASSETS: | |||||||||||
Property and Equipment (Net of Accumulated Depreciation and Amortization of $46,318 and $44,751) | 23,874 | 24,518 | |||||||||
Purchased and Developed Computer Software (Net of Accumulated Amortization of $144,798 and $136,591) | 109,637 | 90,797 | |||||||||
Goodwill, Net | 24,331 | 24,331 | |||||||||
Cash Value of Life Insurance | 23,214 | 29,830 | |||||||||
Other Assets | 54,375 | 69,605 | |||||||||
Total Noncurrent Assets | 235,431 | 239,081 | |||||||||
TOTAL ASSETS | $ | 605,304 | $ | 622,496 | |||||||
American Management Systems, Incorporated
CONSOLIDATED CONDENSED BALANCE SHEETS — CONTINUED
(In thousands, except share data)
3/31/2003 | ||||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | (Unaudited) | 12/31/2002 | ||||||||
CURRENT LIABILITIES: | ||||||||||
Accounts Payable | $ | 14,674 | $ | 17,118 | ||||||
Accrued Compensation and Related Items | 36,542 | 52,674 | ||||||||
Deferred Revenues | 29,118 | 26,115 | ||||||||
Accrued Liabilities | 12,653 | 14,592 | ||||||||
Accrued Restructuring Charge | 5,031 | 7,988 | ||||||||
Income Taxes Payable | 409 | 1,061 | ||||||||
Deferred Income Taxes | 18,304 | 17,159 | ||||||||
Total Current Liabilities | 116,731 | 136,707 | ||||||||
NONCURRENT LIABILITIES: | ||||||||||
Deferred Compensation and Other | 30,839 | 36,364 | ||||||||
Deferred Income Taxes | 21,472 | 20,044 | ||||||||
Accrued Restructuring Charge | 7,973 | 9,356 | ||||||||
Total Noncurrent Liabilities | 60,284 | 65,764 | ||||||||
TOTAL LIABILITIES | 177,015 | 202,471 | ||||||||
STOCKHOLDERS’ EQUITY: | ||||||||||
Preferred Stock ($0.10 Par Value; 4,000,000 Shares Authorized, None Issued or Outstanding) | — | — | ||||||||
Common Stock ($0.01 Par Value; 200,000,000 Shares Authorized, 51,057,214 and 51,057,214 Issued and 42,249,988 and 42,324,218 Outstanding) | 510 | 510 | ||||||||
Capital in Excess of Par Value | 81,059 | 80,309 | ||||||||
Unearned Compensation | (1,676 | ) | (2,146 | ) | ||||||
Retained Earnings | 391,321 | 385,063 | ||||||||
Accumulated Other Comprehensive Loss | (12,150 | ) | (14,915 | ) | ||||||
Treasury Stock, at Cost (8,807,226 and 8,732,996 Shares) | (30,775 | ) | (28,796 | ) | ||||||
Total Stockholders’ Equity | 428,289 | 420,025 | ||||||||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 605,304 | $ | 622,496 | ||||||
American Management Systems, Incorporated
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
Unaudited
(In thousands)
For the Quarter | |||||||||||||
Ended March 31, | |||||||||||||
2003 | 2002 | ||||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||||||||
Net Income | $ | 6,258 | $ | 10,722 | |||||||||
Adjustments to Reconcile Net Income to Net Cash (Used in) Provided by Operating Activities | |||||||||||||
Depreciation | 1,737 | 1,929 | |||||||||||
Amortization | 8,094 | 7,537 | |||||||||||
Stock Compensation Expense | 383 | 933 | |||||||||||
Deferred Income Taxes | 2,718 | 2,768 | |||||||||||
Increase in Cash Surrender Value of Life Insurance | (433 | ) | (360 | ) | |||||||||
Loss on Disposal of Assets | 8 | 77 | |||||||||||
Changes in Assets and Liabilities: | |||||||||||||
(Increase) Decrease in Accounts Receivable | (5,913 | ) | 27,651 | ||||||||||
Decrease (Increase) in Prepaid Expenses and Other Current Assets | 773 | (2,164 | ) | ||||||||||
Decrease (Increase) in Other Assets | 1,617 | (2,985 | ) | ||||||||||
Decrease in Accounts Payable and Other Accrued Liabilities | (5,078 | ) | (5,729 | ) | |||||||||
Decrease in Accrued Compensation and Related Items | (21,974 | ) | (17,250 | ) | |||||||||
Increase (Decrease) in Deferred Revenue | 2,966 | (963 | ) | ||||||||||
Decrease in Accrued Restructuring Charge | (4,341 | ) | (7,734 | ) | |||||||||
Decrease in Income Taxes Payable | (671 | ) | (13,149 | ) | |||||||||
Net Cash (Used in) Provided by Operating Activities | (13,856 | ) | 1,283 | ||||||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||||||||
Purchase of Property and Equipment | (1,038 | ) | (182 | ) | |||||||||
Purchase and Development of Computer Software | (13,288 | ) | (4,638 | ) | |||||||||
Other Assets | 6,644 | (4,060 | ) | ||||||||||
Net Cash Used in Investing Activities | (7,682 | ) | (8,880 | ) | |||||||||
CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||||||||
Proceeds from Common Stock Options Exercised and Employee Stock Purchase Plan | 1,206 | 3,352 | |||||||||||
Payments to Acquire Treasury Stock | (2,341 | ) | (286 | ) | |||||||||
Net Cash (Used in) Provided by Financing Activities | (1,135 | ) | 3,066 | ||||||||||
Effect of Exchange Rate Changes on Cash | 1,748 | (628 | ) | ||||||||||
NET DECREASE IN CASH AND CASH EQUIVALENTS | (20,925 | ) | (5,159 | ) | |||||||||
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 136,191 | 53,347 | |||||||||||
CASH AND CASH EQUIVALENTS AT END OF PERIOD | $ | 115,266 | $ | 48,188 | |||||||||
NON-CASH INVESTING AND FINANCING ACTIVITIES: | |||||||||||||
Exchange of Investment for Intangible Assets, Net of Cash | $ | 16,266 | $ | — | |||||||||
Issuance of Treasury Stock for Stock Options Exercised, Employee Stock Purchase Plan, and Restricted Stock | $ | 217 | $ | 1,679 |