ePLUS REPORTS RECORD ANNUAL REVENUES,
NET EARNINGS, AND EPS
Earnings Conference Call Scheduled for Friday, July 1st
HERNDON, VA - June 29, 2005 - ePlus inc. (Nasdaq NM: PLUS - news), a leading
provider of Enterprise Cost Management (ECM) solutions, announced record
financial results for its quarter and year ended March 31, 2005. For the year,
net earnings increased 149% to $25.3 million from $10.2 million, and fully
diluted earnings per share increased 164% to $2.68 from $1.02 per share.
Revenues increased 74% to $576 million from $331 million the prior year.
For the quarter ended March 31, 2005 net earnings increased 646% to $19.4
million from $2.6 million the prior year, and fully diluted earnings per share
increased 692% to $2.06 from $0.26. Revenues for the quarter increased 97% to
$168.3 million as compared to $85.3 million recorded in the fourth quarter of
2004.
A significant contributor to the increase in net earnings and earnings per share
for the year and quarter was a $37 million payment received in settlement of a
patent infringement lawsuit recorded in the fourth quarter. The settlement
payment was recorded as fee and other income. As a result, for the quarter, fee
and other income increased to $39.9 million from $3.3 million the prior year,
and for the twelve months ended March 31, 2005, increased to $48.5 million from
$11.4 million the prior year.
The Company repurchased 448,616 shares of common stock during the year at a
total cost of $5.7 million. Weighted average diluted shares outstanding were 9.4
million shares on March 31, 2005 as compared to 10.0 million shares the prior
year. The actual number of shares of common stock issued and outstanding on
March 31, 2005 was 8.6 million shares.
At March 31, 2005, the Company had cash and cash equivalents of $38.9 million
and total stockholder's equity of $132 million, as compared to $25.2 million and
$112 million, respectively, at March 31, 2004.
"Competition intensified during our fiscal year ending March 31, 2005, and our
increase in revenues was offset by margin pressure in all business lines, and
increased costs" stated Phillip G. Norton, chairman, president and chief
executive officer of ePlus. "In our software business, we successfully defended
our intellectual property and received a substantial cash settlement, and
continued to invest in software development. ePlus Technology, our wholly owned
subsidiary engaged in IT fulfillment and advanced professional services,
successfully acquired and integrated Manchester Technology's IT sales business,
and its revenues increased both organically and through the proven execution of
strategic acquisitions. With new customers from the acquisition and targeted
marketing campaigns, we continue to expand the base from which to cross-sell our
business process automation and our Enterprise Cost Management solutions."
"Our objective going forward is to improve our internal systems to increase
efficiency and reduce costs, seek out strategic acquisitions to enhance our
portfolio of services and locations, and drive organic growth through more
focused cross-selling and strengthening vendor relations" concluded Mr. Norton.
Investors are encouraged to read the company's Form 10-K for the period ended
March 31, 2005, when filed. Copies will be available at http://www.eplus.com/,
http://www.sec.gov/, or by contacting the company at info@eplus.com or (888)
482-1122.
About ePlus inc.
A leading provider of Enterprise Cost Management, ePlus provides a comprehensive
solution to reduce the costs of purchasing, owning, and financing goods and
services. ePlus Enterprise Cost Management (eECM) packages business process
outsourcing, eProcurement, asset management, product and catalog content
management, supplier enablement, strategic sourcing, financial services and
document access and collaboration into a single integrated solution, all based
on ePlus' leading business application software. The company is headquartered in
Herndon, VA, and has more than 30 locations in the U.S. For more information,
visit http://www.eplus.com/, call 888-482-1122 or email info@eplus.com.
ePlus, eECM, and ePlus Enterprise Cost Management are registered trademarks
ePlus inc. in the U.S. and/or other countries.
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of
1995: Statements in this press release, which are not historical facts, may be
deemed to be "forward-looking statements". Actual and anticipated future results
may vary due to certain risks and uncertainties, including, without limitation,
the existence of demand for, and acceptance of, our services; our ability to
adapt our services to meet changes in market developments; the impact of
competition in our markets; the possibility of defects in our products or
catalog content data; our ability to hire and retain sufficient personnel; our
ability to protect our intellectual property; the creditworthiness of our
customers; our ability to raise capital and obtain non-recourse financing for
our transactions; our ability to realize our investment in leased equipment; our
ability to reserve adequately for credit losses; fluctuations in our operating
results; our reliance on our management team; and other risks or uncertainties
detailed in our Securities and Exchange Commission filings.
All information set forth in this release and its attachments is as of June 29,
2005. ePlus inc. undertakes no duty to update this information. More information
about potential factors that could affect ePlus inc.'s business and financial
results is included in the Company's Annual Report on Form 10-K for the fiscal
year ended March 31, 2004, the Quarterly Report on Form 10-Q for the quarter
ended December 31, 2005, and its Form 10-K for the fiscal year ended March 31,
2005 when filed including (without limitation) under the captions "Risk Factors"
and "Management's Discussion and Analysis of Financial Condition and Results of
Operations," which are on file with the SEC and available at the SEC's website
at http://www.sec.gov/.
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ePlus inc. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
Year Ended March 31,
---------------------------------
2004 2005
---------------------------------
REVENUES
Sales of product $ 267,898,937 $480,970,082
---------------------------------
Lease revenues 51,253,518 46,343,797
Fee and other income 11,405,033 48,484,643
---------------------------------
62,658,551 94,828,440
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TOTAL REVENUES 330,557,488 575,798,522
---------------------------------
COSTS AND EXPENSES
Cost of sales, product 236,283,350 432,774,189
---------------------------------
Direct lease costs 10,560,586 11,508,820
Professional and other fees 3,700,795 9,417,010
Salaries and benefits 41,325,224 54,858,181
General and administrative expenses 14,630,731 18,253,106
Interest and financing costs 6,847,072 5,981,054
---------------------------------
77,064,408 100,018,171
---------------------------------
TOTAL COSTS AND EXPENSES 313,347,758 532,792,360
---------------------------------
Earnings before provision for income taxes 17,209,730 43,006,162
---------------------------------
Provision for income taxes 7,055,989 17,718,360
---------------------------------
NET EARNINGS $ 10,153,741 $25,287,802
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NET EARNINGS PER COMMON SHARE - BASIC $1.09 $ 2.84
=================================
NET EARNINGS PER COMMON SHARE - DILUTED $1.02 $ 2.68
=================================
WEIGHTED AVERAGE SHARES OUTSTANDING - BASIC 9,332,324 8,898,112
WEIGHTED AVERAGE SHARES OUTSTANDING - DILUTED 9,976,458 9,433,250
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ePlus inc. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
As of March 31, As of March 31,
2004 2005
--------------------------------------
ASSETS
Cash and cash equivalents $25,155,011 $38,851,714
Accounts receivable, net of allowance for doubtful
accounts of $1,584,358 and $1,959,049 as of March 31, 2004
and 2005, respectively 51,188,640 93,555,462
Notes receivable 51,986 114,708
Inventories 899,748 2,116,855
Investment in leases and leased equipment - net 186,667,141 189,468,926
Property and equipment - net 5,230,473 6,647,781
Other assets 4,765,782 3,859,791
Goodwill 20,243,310 26,125,212
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TOTAL ASSETS $294,202,091 $360,740,449
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LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Accounts payable - equipment $9,993,077 $8,965,022
Accounts payable - trade 32,140,670 55,332,993
Salaries and commissions payable 583,934 771,487
Accrued expenses and other liabilities 11,983,798 32,945,931
Recourse notes payable 5,863 6,264,897
Nonrecourse notes payable 117,857,208 114,838,994
Deferred tax liability 10,053,226 9,519,309
--------------------------------------
Total Liabilities 182,617,776 228,638,633
COMMITMENTS AND CONTINGENCIES - -
STOCKHOLDERS' EQUITY
Preferred stock, $.01 par value; 2,000,000 shares authorized;
none issued or outstanding - -
Common stock, $.01 par value; 25,000,000 authorized,
10,717,242 issued and 8,939,958 outstanding at March 31,
2004; and 25,000,000 authorized, 10,807,392 issued and
8,581,492 outstanding at March 31, 2005 $107,172 $108,074
Additional paid-in capital 64,339,988 65,181,862
Treasury stock, at cost, 1,777,284 and 2,225,900 shares,
respectively (17,192,886) (22,887,881)
Retained earnings 64,211,474 89,499,096
Accumulated other comprehensive income - Foreign currency
translation adjustment 118,567 200,665
--------------------------------------
Total Stockholders' Equity 111,584,315 132,101,816
--------------------------------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $294,202,091 $360,740,449
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Contact: Kleyton L. Parkhurst, SVP
ePlus inc.
kparkhurst@eplus.com
703-984-8150