Contacts:
Chief Executive Officer SVP Finance
Zach Lonstein William McHale
Infocrossing, Inc. Infocrossing, Inc.
201-840-4710 201-840-4732
zlonstein@infocrossing.com wmchale@infocrossing.com
Media Relations Investor Relations
Michael Wilczak Don Duffy
Infocrossing, Inc. Integrated Corporate Relations
201-840-4941 203-222-9013
mwilczak@infocrossing.com
INFOCROSSING REPORTS FIRST QUARTER 2003 RESULTS
o First quarter revenue grows 17%
o EBITDA increases to $2.3 million from $.3 million
LEONIA, NJ, May 7, 2003 -- Infocrossing, Inc. (Nasdaq: IFOX), a premier provider
of information technology and business process outsourcing solutions to large
and mid-sized companies, announced today strong results for the first quarter
ended March 31, 2003. For the first quarter of 2003, revenues increased 16.9% to
$13.1 million compared with $11.2 million for the same quarter last year.
The Company also reported strong growth in earnings before interest, taxes,
depreciation and amortization (EBITDA) compared with the result for the same
quarter last year. Excluding $2.8 million of expense credits recorded in the
first quarter of last year related to the settlement of a dispute with a
software licensor, EBITDA increased to $2.3 million in the first quarter of 2003
from $0.3 million in the first quarter of 2002. EBITDA is another measure of a
company's ability to generate cash from its operations and Management believes
this measure is important to disclose, as it is a commonly used financial
metric. A reconciliation of net income to EBITDA follows in the Summary
Consolidated Statements of Operations.
"Infocrossing's results for the first quarter reflect the wider acceptance of
our selective IT outsourcing solutions as a viable way of cutting IT
infrastructure costs while accessing leading edge technology," stated Zach
Lonstein, Infocrossing's Chairman and Chief Executive Officer. "Our clients
achieve cost and performance benefits while we achieve enhanced profitability
through operational leverage," he continued.
During the first quarter of 2003, Infocrossing signed several new, multi-year
contracts for the Company's selective mainframe, AS/400 and open system
outsourcing services. Including signed letters of intent, Infocrossing has
received commitments totaling more than $500,000 per month in new revenue, and
$21 million over the respective contract terms ranging from two to seven years.
The Company estimates that these commitments will generate additional revenues
of approximately $.7 million in the second quarter and approximately $1.5
million per quarter thereafter.
Mr. Lonstein added: "Through the first four months of 2003, we've signed new
revenue commitments nearly equal to the amount of new contracts signed during
the entire year in 2002." In 2002, Infocrossing announced $22 million in new
contracts signed throughout the year.
The Company reported a net loss to common stockholders of $2.2 million, or $0.40
per share, in the first quarter of 2003, compared with a net loss of $3.7
million or $0.70 per share in 2002, excluding the $2.8 million of expense
credits recorded in the first quarter of 2002 related to the settlement of a
dispute with a software licensor. Including the effect of the one-time expense
credits, net loss to common stockholders was $0.9 million, or $0.17 per share in
the first quarter of 2002. The net loss to common stockholders includes non-cash
items for accretion on redeemable preferred stock and accumulated preferred
stock dividends totaling $2.4 million, or $0.46 per common share, in the first
quarter of 2003 versus $2.2 million, or $0.42 per common share, in the same
period of 2002.
Mr. Lonstein concluded: "Our financial results and contract signings validate
the value of our selective IT outsourcing solutions. Given the demand we are
seeing for our services, we have tremendous confidence that 2003 will turn into
another record year".
Infocrossing will hold a teleconference to discuss first quarter results with
the financial community today, Wednesday, May 7, 2003, at 4:30 p.m. Eastern
Time. Dial in: 1-888-371-9318 or 973-935-2100 for international callers, at
least 10 minutes before the start of the call. A telephone replay will also be
available until May 21, 2003 starting one hour after the conclusion of the
teleconference. Interested persons may listen to the playback of the
teleconference by calling 1-877-519-4471 toll free or 973-341-3080 for
international callers and entering the pass code number 3911424.
"EBITDA" is defined as earnings before income taxes, depreciation, amortization,
amortization of a restricted stock award, interest, and, when applicable,
restructuring costs, impairment of assets, and other income and expenses. The
issuance of purchase credits by a software licensor in connection with the
settlement of a dispute has been treated as an operating item and is included in
EBITDA. EBITDA should not be considered as an alternative to operating income,
as defined by generally accepted accounting principles, as an indicator of our
operating performance, or to cash flows, as a measure of liquidity.
About Infocrossing, Inc. (http://www.infocrossing.com) Infocrossing, Inc. (IFOX)
is a premier provider of a full range of IT outsourcing services, including
mainframe and open system outsourcing, remote systems and network management,
business process outsourcing and IT infrastructure consulting services. With
more than 17 years of experience managing large, mission-critical IT systems,
Infocrossing assures the optimal performance, security, reliability, and
scalability of customers' mainframe and web environments, irrespective of where
the systems components are located. Infocrossing maintains strategic alliances
with leading technology providers, including IBM, Computer Associates, EMC, Sun
Microsystems, Intel and Cisco Systems.
This release contains forward-looking statements within the meaning of Section
21E of the Securities Exchange Act of 1934, as amended. As such, final results
could differ from estimates or expectations due to risks and uncertainties,
including, but not limited to: incomplete or preliminary information; changes in
government regulations and policies; continued acceptance of the Company's
products and services in the marketplace; competitive factors; new products;
technological changes; the Company's dependence upon third-party suppliers;
intellectual property rights; and other risks. For any of these factors, the
Company claims the protection of the safe harbor for forward-looking statements
contained in the Private Securities Litigation Reform Act of 1995, as amended.
INFOCROSSING, INC.
AND SUBSIDIARIES
SUMMARY CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited, in thousands,
except per share amounts)
Three Months Ended
March 31,
------------------------------------
2003 2002
---------------- ----------------
Revenues $ 13,129 $ 11,233
----------- -----------
Operating costs 8,310 5,418
Selling and administrative expenses 2,540 2,742
Depreciation and amortization 1,416 1,362
----------- -----------
Income from operations 863 1,711
Net interest expense 573 381
----------- -----------
Income before income taxes 290 1,330
Income tax expense 20 -
----------- ----------
Net income 270 1,330
Accretion and dividends on redeemable preferred stock (2,448) (2,249)
----------- -----------
Net loss to common stockholders $ (2,178) $ (919)
=========== ===========
Basic and Diluted Earnings per Share:
Net loss to common stockholders $ (0.40) $ (0.17)
=========== ===========
Weighted average number of common shares outstanding 5,379 5,342
=========== ===========
The net loss to common stockholders is on both a basic and diluted net loss per
share basis. Common stock equivalents are excluded from the computation of
diluted net loss per share since the inclusion of such equivalents would be
anti-dilutive.
The following table reconciles EBITDA to net income for the quarters ended March
31, 2003 and 2002.
Reconciliation - in Thousands
Three Months Ended March 31,
2003 2002
----------------- -----------------
NET INCOME $ 270 $ 1,330
Add back:
Tax expense 20 -
Net interest expense 573 381
Depreciation and amortization 1,416 1,362
----------- -----------
EBITDA $ 2,279 $ 3,073
=========== ===========
INFOCROSSING, INC.
AND SUBSIDIARIES
SUMMARY CONSOLIDATED BALANCE SHEETS
(in thousands)
March 31, December 31,
2003 2002
----------------- ----------------
(Unaudited)
ASSETS:
Cash and equivalents $ 7,137 $ 7,026
Other current assets 5,710 6,720
----------- -----------
Total current assets 12,847 13,746
Property and equipment, net 20,509 19,437
Other non-current assets 32,145 32,312
----------- -----------
Total Assets $ 65,501 $ 65,495
=========== ===========
LIABILITIES AND STOCKHOLDERS' DEFICIT:
Current liabilities $ 10,260 $ 11,612
Long-term liabilities 13,987 12,899
Redeemable preferred stock 55,637 53,189
Common stockholders' deficit (14,383) (12,205)
----------- -----------
Total Liabilities and Stockholders' Deficit $ 65,501 $ 65,495
=========== ===========