Exhibit 99.1
FOR IMMEDIATE RELEASE
AGILYSYS, INC. REPORTS FISCAL 2005 THIRD-QUARTER RESULTS
| | • | Sales of $516 Million Increase 12 Percent Year Over Year |
| | • | Net Income Increases 64 Percent to $14.2 million |
| | • | Earnings Per Share of $0.42 versus $0.28 Last Year |
CLEVELAND — February 9, 2005 — Agilysys, Inc. (Nasdaq: AGYS), a leading provider of enterprise computer technology solutions, today announced its fiscal 2005 third-quarter and nine months results for the period ended December 31, 2004. For the quarter, the company’s sales increased 12 percent to $515.7 million compared with $459.4 million for the third quarter last year. Gross margin was 12.8 percent of sales versus 12.9 percent in the prior year. Net income for the quarter was $14.2 million, or $0.42 per share, compared with net income of $8.7 million, or $0.28 per share in the third quarter last year.
Arthur Rhein, chairman, president and chief executive officer of Agilysys, said, “Agilysys continued its strong performance in our highest-volume quarter with solid execution across the entire business.”
Nine Months Results
For the nine months ended December 31, 2004, sales were $1.27 billion, a 23 percent increase over sales of $1.03 billion reported for the same period last year. The company recorded net income for the nine months of $21.8 million, or $0.70 per share, compared with net income of $3.8 million, or $0.14 per share last year.
Update on Fiscal 2005 Business Outlook
Agilysys said based on current business trends it expects fiscal 2005 sales growth to be approximately 20 percent. Full-year gross margin is expected to be approximately 13 percent of sales, with increased operating leverage resulting in earnings per share of $0.90 to $0.93.
Agilysys also said it expects to incur fiscal 2005 capital expenditures of approximately $2.0 million, depreciation and amortization of approximately $11.3 million and interest expense, net of interest income, of approximately $3.5 million, assuming no additional retirement of its Senior Notes.
Conference Call Information
A conference call to discuss the quarterly results is scheduled for 11 a.m. ET on Wednesday, February 9, 2005. The conference call will be broadcast live over the Internet and a replay will be accessible on the investor relations page of the company’s Web site:www.agilysys.com.
A taped replay of the conference call will be available at 2 p.m. ET on Wednesday, February 9, 2005 through midnight ET on Wednesday, February 16, 2005, accessible by dialing 877-344-7529 or 412-858-1440 (event code #529 and passcode #364381).
Forward-Looking Language
Portions of this release, particularly the statements made by management and those that are not historical facts, are forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on current assumptions and expectations, and are subject to risks and uncertainties, many of which are beyond the control of Agilysys.
Many factors could cause Agilysys actual results to differ materially from those anticipated by the forward-looking statements. These factors include those referenced in the Annual Report on Form 10-K or as may be described from time to time in Agilysys subsequent SEC filings.
Potential factors that could cause actual results to differ materially from those expressed or implied by such statements include, but are not limited to, those relating to Agilysys anticipated revenue gains, margin improvements, cost savings, and new product introductions.
Other associated risks include geographic factors, political and economic risks, the actions of Agilysys competitors, changes in economic or industry conditions or in the markets served by Agilysys, and the ability to appropriately integrate acquisitions, strategic alliances, and joint ventures.
In addition, this release contains time-sensitive information and reflects management’s best analysis only as of the date of this release. Agilysys does not undertake any obligation to publicly update or revise any forward-looking statements to reflect future events, information or circumstances that arise after the date of this release. Information on the potential factors that could affect Agilysys actual results of operations is included in its filings with the Securities and Exchange Commission, including, but not limited to, its Annual Report on Form 10-K for the fiscal year ended March 31, 2004. Interested persons can obtain it free at the Securities and Exchange Commission’s website, which is located at www.sec.gov.
About Agilysys, Inc.
Agilysys, Inc. is one of the foremost distributors and premier resellers of enterprise computer technology solutions. It has a proven track record of delivering complex servers, software, storage and services to resellers and corporate customers across a diverse set of industries. In addition, the company provides customer-centric software applications and services focused on the retail and hospitality markets. Headquartered in Cleveland, Ohio, Agilysys has sales offices throughout the U.S. and Canada. For more information, visit the company’s website atwww.agilysys.com.
| | | |
| For more information contact: | | Martin Ellis |
| | Executive Vice President, Corporate Development |
| | and Investor Relations |
| | Agilysys, Inc. |
| | 440-720-8682 |
| | martin.ellis@agilysys.com |
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AGILYSYS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
| | | | | | | | | | | | | | | | | |
| | | Three Months Ended | | | Nine Months Ended | |
| | | December 31 | | | December 31 | |
| (In Thousands, Except Share and Per Share Data) | | 2004 | | | 2003 | | | 2004 | | | 2003 | |
| Net Sales | | $ | 515,684 | | | $ | 459,363 | | | $ | 1,266,766 | | | $ | 1,031,639 | |
| Cost of Goods Sold | | | 449,880 | | | | 399,937 | | | | 1,103,956 | | | | 902,572 | |
| | | | | | | | | | | | | |
| Gross Margin | | | 65,804 | | | | 59,426 | | | | 162,810 | | | | 129,067 | |
| Operating Expenses | | | | | | | | | | | | | | | | |
| Selling, General, and Administrative | | | 39,702 | | | | 38,497 | | | | 117,880 | | | | 101,871 | |
| Restructuring Charges | | | 107 | | | | 860 | | | | 408 | | | | 2,054 | |
| | | | | | | | | | | | | |
| Operating Income | | | 25,995 | | | | 20,069 | | | | 44,522 | | | | 25,142 | |
| Other (Income) Expense | | | | | | | | | | | | | | | | |
| Other Income, net | | | (156 | ) | | | (160 | ) | | | (582 | ) | | | (710 | ) |
| Interest Expense, net | | | 678 | | | | 2,111 | | | | 2,848 | | | | 6,909 | |
| Loss on Retirement of Debt | | | — | | | | 712 | | | | — | | | | 3,343 | |
| | | | | | | | | | | | | |
| Income Before Income Taxes | | | 25,473 | | | | 17,406 | | | | 42,256 | | | | 15,600 | |
| Provision for Income Taxes | | | 9,637 | | | | 6,967 | | | | 15,859 | | | | 6,248 | |
| Distributions on Mandatorily Redeemable Convertible Trust Preferred Securities, net of Tax | | | 1,378 | | | | 1,319 | | | | 4,089 | | | | 3,986 | |
| | | | | | | | | | | | | |
| Income from Continuing Operations | | | 14,458 | | | | 9,120 | | | | 22,308 | | | | 5,366 | |
| Loss from Discontinued Operations, net of Tax | | | 229 | | | | 458 | | | | 489 | | | | 1,540 | |
| | | | | | | | | | | | | |
| Net Income | | $ | 14,229 | | | $ | 8,662 | | | $ | 21,819 | | | $ | 3,826 | |
| | | | | | | | | | | | | |
| Earnings Per Share — Basic | | | | | | | | | | | | | | | | |
| Income from Continuing Operations | | $ | 0.51 | | | $ | 0.33 | | | $ | 0.80 | | | $ | 0.19 | |
| Loss from Discontinued Operations | | | — | | | | (0.02 | ) | | | (0.02 | ) | | | (0.05 | ) |
| | | | | | | | | | | | | |
| Net Income | | $ | 0.51 | | | $ | 0.31 | | | $ | 0.78 | | | $ | 0.14 | |
| | | | | | | | | | | | | |
| Earnings Per Share — Diluted | | | | | | | | | | | | | | | | |
| Income from Continuing Operations | | $ | 0.42 | | | $ | 0.29 | | | $ | 0.72 | | | $ | 0.19 | |
| Loss from Discontinued Operations | | | — | | | | (0.01 | ) | | | (0.02 | ) | | | (0.05 | ) |
| | | | | | | | | | | | | |
| Net Income | | $ | 0.42 | | | $ | 0.28 | | | $ | 0.70 | | | $ | 0.14 | |
| | | | | | | | | | | | | |
| Weighted Average Shares Outstanding | | | | | | | | | | | | | | | | |
| Basic | | | 28,119,460 | | | | 27,742,163 | | | | 28,057,571 | | | | 27,744,300 | |
| Diluted | | | 37,269,747 | | | | 36,255,843 | | | | 36,825,936 | | | | 28,214,590 | |
| Cash Dividends Per Share | | $ | 0.03 | | | $ | 0.03 | | | $ | 0.09 | | | $ | 0.09 | |
AGILYSYS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts at December 31, 2004 are Unaudited)
| | | | | | | | | |
| | | December 31 | | | March 31 | |
| (In Thousands) | | 2004 | | | 2004 | |
| ASSETS | | | | | | | | |
| Current Assets | | | | | | | | |
| Cash and Cash Equivalents | | $ | 212,049 | | | $ | 149,903 | |
| Accounts Receivable, net | | | 372,071 | | | | 295,272 | |
| Inventories, net | | | 54,345 | | | | 52,236 | |
| Deferred Income Taxes | | | 17,285 | | | | 9,255 | |
| Prepaid Expenses | | | 2,151 | | | | 2,234 | |
| Assets of Discontinued Operations | | | 1,122 | | | | 5,451 | |
| | | | | | | |
| Total Current Assets | | | 659,023 | | | | 514,351 | |
| Goodwill and Intangible Assets, net | | | 180,114 | | | | 179,975 | |
| Investments | | | 18,506 | | | | 18,819 | |
| Other Assets | | | 18,582 | | | | 11,396 | |
| Property and Equipment, net | | | 31,631 | | | | 35,121 | |
| | | | | | | |
| Total Assets | | $ | 907,856 | | | $ | 759,662 | |
| | | | | | | |
| LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | | | | | |
| Current Liabilities | | | | | | | | |
| Accounts Payable | | $ | 310,508 | | | $ | 208,115 | |
| Accrued Liabilities | | | 50,805 | | | | 39,047 | |
| Liabilities of Discontinued Operations | | | 3,585 | | | | 4,006 | |
| | | | | | | |
| Total Current Liabilities | | | 364,898 | | | | 251,168 | |
| Long-Term Debt | | | 59,568 | | | | 59,503 | |
| Deferred Income Taxes | | | 13,283 | | | | 4,426 | |
| Other Liabilities | | | 10,867 | | | | 10,150 | |
| Mandatorily Redeemable Convertible Trust Preferred Securities | | | 125,325 | | | | 125,425 | |
| Shareholders’ Equity | | | 333,915 | | | | 308,990 | |
| | | | | | | |
| Total Liabilities and Shareholders’ Equity | | $ | 907,856 | | | $ | 759,662 | |
| | | | | | | |
