FOR IMMEDIATE RELEASE
Contact:
James L. Fox
Executive Vice President and Chief Financial Officer
(212) 907-6015
The BISYS Group, Inc.
(NYSE: BSG)
www.bisys.com
BISYS(R) REPORTS FISCAL SECOND QUARTER RESULTS
-- Revenue Increases 13 Percent to Record $263 Million --
-- Internal Revenue Growth Improves Across All Business Groups --
-- Net Cash Provided by Operating Activities
Increases 29 Percent to $58.8 Million --
NEW YORK, N.Y. (January 21, 2004) -- BISYS, a leading provider of business
process outsourcing solutions for the financial services sector, today reported
the results of its fiscal second quarter ended December 31, 2003.
For the fiscal second quarter, BISYS reported net income of $20.0 million or
$0.17 per diluted share, as compared to net income of $28.7 million or $0.24 per
diluted share for the same period in fiscal 2003. Actual results for the fiscal
second quarter of 2004 include restructuring charges of $1.4 million or $0.01
per diluted share net of tax, primarily related to the implementation of the
reorganization plan for certain business operations as announced in September
2003. Excluding restructuring charges, pro forma net income was $21.4 million or
$0.18 per diluted share for the fiscal 2004 second quarter, in line with
analysts' consensus expectations.
Revenue for the quarter was $263.3 million, an increase of 13 percent from
$233.1 million in the same period last year. Net cash provided by operating
activities was $58.8 million, an increase of more than 29 percent from $45.4
million in the same period last year.
BISYS reported net income of $24.9 million or $0.21 per diluted share for the
six months ended December 31, 2003, as compared to net income of $45.5 million
or $0.37 per diluted share for the six months ended December 31, 2002. Actual
results for the six months ended December 31, 2003 include restructuring,
impairment, and other charges of $14.5 million or $0.12 per diluted share net of
tax, primarily related to the integration, consolidation, and reorganization of
certain business operations, particularly in the Company's European Fund
Services division and the Insurance and Education Services group. Actual results
for the six months ended December 31, 2002 include restructuring charges of $7.5
million or $0.06 per diluted share net of tax, related to the integration,
consolidation, and relocation of certain business operations, primarily as a
result of acquisition activity.
Excluding restructuring, impairment, and other charges, pro forma net income for
the six months ended December 31, 2003 was $39.3 million or $0.33 per diluted
share, as compared to pro
forma net income of $53.1 million or $0.44 per diluted share for the same period
last year. BISYS' six months revenue increased to $500.7 million, up nine
percent over fiscal 2003 six months revenue of $460.5 million.
The Company has included the above pro forma information concerning
restructuring, impairment, and other charges to assist investors in analyzing
BISYS' results of operations. The Company has elected to provide this
information to enable investors to perform meaningful comparisons of past,
present, and future operating results, and as a means to emphasize the results
of core, ongoing operations.
ABOUT BISYS
The BISYS Group, Inc. (NYSE: BSG), headquartered in New York City, provides
business process outsourcing solutions that enable investment firms, insurance
companies, and banks to capitalize on convergence by entering new segments of
the financial services industry. BISYS currently supports more than 22,000
domestic and international financial institutions and corporate clients through
three business units. Its INVESTMENT SERVICES group provides administration and
distribution services for approximately 370 clients, representing approximately
2,200 mutual funds, hedge funds, private equity funds, and other alternative
investment products with approximately $750 billion in assets under
administration. BISYS' largest group also provides retirement services to more
than 18,000 companies in partnership with 40 of the nation's leading banks and
investment management companies, and offers analytical research and competitive
information through its Financial Research Corporation (FRC) subsidiary. Through
its INSURANCE AND EDUCATION SERVICES group, BISYS is the nation's largest
independent distributor of life insurance and the premier provider of the
support services required to sell traditional and variable life, long-term care,
disability, and annuity products. BISYS is also the nation's second largest
independent wholesale distributor of commercial property/casualty insurance.
This group complements its insurance distribution services with a comprehensive
compliance management solution that supports insurance and investment firms and
professionals with more than 215 certification and continuing education training
courses, and a sophisticated suite of products and services that automates the
entire licensing process. BISYS' INFORMATION SERVICES group supports
approximately 1,450 banks, insurance companies, and corporations with
industry-leading information processing and imaging solutions, turnkey asset
retention solutions, and specialized corporate banking solutions. Additional
information is available at www.bisys.com.
Except for the historical information contained herein, the matters discussed in
the press release are forward-looking statements within the meaning of the
safe-harbor provisions of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements are subject to risks and uncertainties that may
cause actual results to differ materially, including but not limited to
economic, competitive, governmental and technological factors affecting the
Company's operations, markets, services and related products, prices and other
factors discussed in the Company's periodic filings with the Securities and
Exchange Commission.
###
THE BISYS GROUP, INC.
SUMMARY CONSOLIDATED FINANCIAL DATA
(Unaudited)
(In thousands, except per share data)
THREE MONTHS ENDED SIX MONTHS ENDED
DECEMBER 31, DECEMBER 31,
Statement of Operations Data: 2003 2002 2003 2002
--------- --------- --------- ---------
Revenues $ 263,331 $ 233,112 $ 500,713 $ 460,456
--------- --------- --------- ---------
Operating cost and expenses:
Service and operating 168,691 136,126 321,203 271,675
Selling, general and administrative 49,397 42,593 95,526 87,179
Amortization of intangible assets 6,693 4,393 12,499 8,665
Restructuring, impairment and other charges 2,151 -- 14,775 12,079
--------- --------- --------- ---------
Total expenses 226,932 183,112 444,003 379,598
--------- --------- --------- ---------
Operating earnings 36,399 50,000 56,710 80,858
Interest income 282 535 607 908
Interest expense (4,735) (4,568) (9,399) (8,953)
--------- --------- --------- ---------
Income before income taxes 31,946 45,967 47,918 72,813
Income taxes 11,900 17,238 23,061 27,305
--------- --------- --------- ---------
Net income $ 20,046 $ 28,729 $ 24,857 $ 45,508
========= ========= ========= =========
Basic earnings per share $ 0.17 $ 0.24 $ 0.21 $ 0.38
Diluted earnings per share $ 0.17 $ 0.24 $ 0.21 $ 0.37
Weighted average shares outstanding 119,350 119,273 119,578 119,393
Weighted average equivalent shares outstanding 120,091 120,967 120,730 121,886
Pro forma:
Reported net income $ 20,046 $ 28,729 $ 24,857 $ 45,508
Addback:
Restructuring, impairment and other charges, net of tax 1,350 -- 14,483 7,549
Pro forma net income 21,396 28,729 39,340 53,057
Diluted earnings per share:
Reported net income $ 0.17 $ 0.24 $ 0.21 $ 0.37
Addback:
Restructuring, impairment and other charges, net of tax 0.01 -- 0.12 0.06
Pro forma net income $ 0.18 $ 0.24 $ 0.33 $ 0.44
THE BISYS GROUP, INC.
SUMMARY CONSOLIDATED FINANCIAL DATA
(Unaudited)
(In thousands)
THREE MONTHS ENDED SIX MONTHS ENDED
DECEMBER 31, DECEMBER 31,
Business Segment Data: 2003 2002 2003 2002
--------- --------- --------- ---------
Revenues:
Investment Services $ 138,211 $ 121,853 $ 266,382 $ 242,797
Insurance and Education Services 68,438 58,830 125,564 114,529
Information Services 56,682 52,429 108,767 103,130
--------- --------- --------- ---------
Total $ 263,331 $ 233,112 $ 500,713 $ 460,456
========= ========= ========= =========
Operating earnings (loss)*:
Investment Services $ 16,457 $ 17,872 $ 32,870 $ 33,956
Insurance and Education Services 13,414 23,738 22,229 43,407
Information Services 14,839 13,825 27,726 26,230
Corporate (6,160) (5,435) (11,340) (10,656)
--------- --------- --------- ---------
Total $ 38,550 $ 50,000 $ 71,485 $ 92,937
========= ========= ========= =========
* Excludes the impact of restructuring, impairment and other charges.
DECEMBER 31, JUNE 30,
Balance Sheet Data: 2003 2003
---------- ----------
Cash and cash equivalents $ 85,054 $ 79,558
Restricted cash 56,324 26,603
Accounts receivable, net 95,055 96,237
Insurance premiums and commissions receivable, net 189,000 169,780
Total assets 1,663,795 1,526,893
Insurance premiums and commissions payable 129,666 79,398
Short-term borrowings 200,000 172,000
Long-term debt 300,000 300,000
Stockholders' equity 806,874 785,061
Other Financial Data: THREE MONTHS ENDED SIX MONTHS ENDED
DECEMBER 31, DECEMBER 31,
2003 2002 2003 2002
------- ------- ------- -------
Capital expenditures $ 7,315 $11,277 $16,802 $25,178
Net cash provided by operating activities $58,775 $45,418 $85,207 $62,222
Effective tax rate, excluding impact of restructuring,
impairment and other charges 37.25% 37.50% 37.25% 37.50%