Exhibit 99.1
Innodata Isogen Reports Fourth Quarter and Year-End 2004 Results
NEW YORK--(BUSINESS WIRE)--March 17, 2005--Innodata Isogen, Inc.
(NASDAQ:INOD)
-- Q4 revenues rise 25%, earnings jump 50%
-- Annual revenues jump 47%, earnings up 16-fold
-- More than $20 million in cash balances
-- Company withdraws public offering
Innodata Isogen, Inc. (NASDAQ:INOD), a leading provider of content
supply chain solutions, today announced net income of $1,097,000, or
$0.04 per diluted share, for the fourth quarter of 2004, versus net
income of $734,000, or $0.03 per diluted share, for the fourth quarter
of 2003.
The fourth quarter results reflect an after-tax charge of
approximately $381,000, or $0.01 per diluted share, for costs of a
planned public offering that the company has withdrawn.
Revenues were $13,511,000 for the three months ended December 31,
2004, compared to revenues of $10,821,000 for the same period in 2003,
climbing approximately 25%.
Net income for the twelve months ended December 31, 2004 was
$7,857,000, or $0.32 per diluted share, up substantially from net
income of $475,000, or $0.02 per diluted share, for the comparable
period in 2003. Revenues for the twelve months ended December 31, 2004
were $53,949,000 versus $36,714,000 in the same period the year
before.
Innodata Isogen's cash position rose to $20,663,000 as of December
31, 2004, up from approximately $6,000,000 as of December 31, 2003.
The company generated approximately $15,669,000 cash from operating
activities in 2004 and working capital climbed to more than $22
million by the end of the fourth quarter of 2004.
The company attributed the financial results to a more favorable
business climate, in which capital spending in the commercial and
enterprise publishing sectors began to accelerate in 2004.
The company expects a decline in year-over-year revenues in the
first half of 2005, principally because of the conclusion of two
significant projects, one of which was terminated in January, and
delays in the start of a new project.
"We believe that overall demand for the type of the information
management and knowledge services we provide will remain strong in
2005," said Jack Abuhoff, chairman and chief executive officer of
Innodata Isogen. "We have a solid business model and many talented
people. We're all working very hard to build the kind of organization
that can better capitalize on the opportunities before us."
The company also announced that it has withdrawn its planned
public offering of 4.25 million common shares and 3.25 million common
shares that were to be offered for resale by selling shareholders.
"Our primary objective is maximizing shareholder value," Abuhoff
commented. "We concluded that the timing for an offering was not
right."
The company had planned to use net proceeds of the public offering
to fund acquisitions and accelerate other growth opportunities.
Abuhoff noted that potential acquisitions continue to be a part of the
company's overall growth strategy.
Timing of Conference Call with Q&A
Innodata Isogen will conduct an earnings conference call,
including a question & answer period, at 11:00 a.m. ET today. You can
participate in this call by dialing the following call-in numbers:
1-800-289-0507 (Domestic)
1-913-981-5540 (International)
1-888-203-1112 (Domestic Replay)
1-719-457-0820 (International Replay)
Passcode on Replay only: 1608374
Investors are also invited to access a live webcast of the
conference call at the Investor Relations section of
www.innodata-isogen.com. Please note that the webcast feature will be
in listen-only mode.
Call-in or webcast replay will be available for 30 days following
the conference call.
About Innodata Isogen
Innodata Isogen (www.innodata-isogen.com) provides business and
technology services that help organizations create, manage and
distribute information more effectively and economically. We are
headquartered in Hackensack, New Jersey, just outside of New York
City. We have two additional solution centers in North America, seven
content production facilities in North America and Asia (the
Philippines, India and Sri Lanka) and a technology and tools
development center in India.
This release contains certain forward-looking statements,
including without limitation, statements concerning the company's
operations, economic performance, and financial condition. These
forward-looking statements are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
The words "estimate," "believe," "expect," and "anticipate" and other
similar expressions generally identify forward-looking statements,
which speak only as of their dates.
These forward-looking statements are based largely on the
company's current expectations, and are subject to a number of risks
and uncertainties, including without limitation, continuing revenue
concentration in a limited number of clients, continuing reliance on
project-based work, worsening of market conditions, changes in
external market factors, the ability and willingness of the company's
clients and prospective clients to execute business plans which give
rise to requirements for digital content and professional services in
knowledge processing, difficulty in integrating and deriving synergies
from acquisitions, potential undiscovered liabilities of companies
that Innodata Isogen acquires, changes in the company's business or
growth strategy, the emergence of new or growing competitors, various
other competitive and technological factors, and other risk and
uncertainties indicated from time to time in the company's filings
with the Securities and Exchange Commission.
Actual results could differ materially from the results referred
to in the forward-looking statements. In light of these risks and
uncertainties, there can be no assurance that the results referred to
in the forward-looking statements contained in this release will
occur.
We undertake no obligation to update or review any guidance or
other forward-looking information, whether as a result of new
information, future developments or otherwise.
INNODATA ISOGEN, INC., AND SUBSIDIARIES
CONDENSED CONSOLIDATED INCOME STATEMENT
(In thousands, except per share amounts)
Three Months Ended 12 Months Ended
December 31, December 31,
2004 2003 2004 2003
--------- --------- ---------- --------
(Unaudited) (Unaudited)(Audited)
REVENUES $ 13,511 $ 10,821 $ 53,949 $ 36,714
--------- --------- ---------- --------
OPERATING COSTS AND EXPENSES:
Direct operating expenses 8,569 7,571 33,050 27,029
Selling and administrative
expenses 2,691 2,337 10,205 8,898
Aborted offering costs 625 625 -
Bad debt recovery - net - (963) -
Interest income - net (49) (2) (62) (21)
--------- --------- ---------- --------
Total 11,836 9,906 42,855 35,906
--------- --------- ---------- --------
INCOME BEFORE PROVISION FOR
INCOME TAXES 1,675 915 11,094 808
PROVISION FOR INCOME TAXES 578 181 3,237 333
--------- --------- ---------- --------
NET INCOME $ 1,097 $ 734 $ 7,857 $ 475
========= ========= ========== ========
INCOME PER SHARE:
Basic $ .05 $ .03 $ .35 $ .02
========= ========= ========== ========
Diluted $ .04 $ .03 $ .32 $ .02
========= ========= ========== ========
WEIGHTED AVERAGE SHARES
OUTSTANDING:
Basic 22,622 21,782 22,288 21,570
========= ========= ========== ========
Diluted 25,640 24,368 24,817 22,966
========= ========= ========== ========
INNODATA ISOGEN, INC., AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In Thousands)
December 31, December 31,
2004 2003
------------- -----------
(Unaudited) (Audited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 20,663 $ 5,051
Cash and cash equivalents - restricted - 1,000
Accounts receivable-net 8,019 8,497
Prepaid expenses and other current assets 1,757 999
Refundable income taxes - 1,075
Deferred income taxes 645 1,421
------------- -----------
Total current assets 31,084 18,043
PROPERTY AND EQUIPMENT - NET 4,559 5,628
OTHER ASSETS 893 800
GOODWILL 675 675
------------- -----------
TOTAL $ 37,211 $ 25,146
============= ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable and accrued expenses $ 3,412 $ 2,451
Accrued salaries, wages and related benefits 3,979 2,865
Income and other taxes 1,304 598
Current portion of capital lease obligations 180 146
------------- -----------
Total current liabilities 8,875 6,060
DEFERRED INCOME TAXES 1,449 1,410
OBLIGATIONS UNDER CAPITAL LEASE 150 272
STOCKHOLDERS' EQUITY 26,737 17,404
------------- -----------
TOTAL $ 37,211 $ 25,146
============= ===========
CONTACT: Innodata Isogen
Al Girardi, 201-488-1200, ext. 5392
agirardi@innodata-isogen.com