Exhibit 99.1
Innodata Isogen Reports First Quarter
2005 Results; Company Reports Revenues of Approximately $11.2 Million;
Cash Balances Again Increase
NEW YORK--(BUSINESS WIRE)--May 12, 2005--INNODATA ISOGEN, INC.
(NASDAQ: INOD), a leading provider of content supply chain solutions,
today announced net income of $299,000, or $0.01 per diluted share,
for the first quarter of 2005, versus net income of $2,080,000, or
$0.08 per diluted share, for the first quarter of 2004, and net income
of $1,097,000, or $0.04 per diluted share, for the fourth quarter of
2004.
Revenues were $11,190,000 for the three months ended March 31,
2005, down almost 8% from revenues of $12,157,000 for the same period
last year and approximately 17% from revenues of $13,511,000 last
quarter.
The company saw unrestricted cash and equivalents again increase,
from approximately $20,663,000 at December 31, 2004 to approximately
$23,422,000 at March 31, 2005. This growth also represents a 127%
increase from the approximately $10,316,000 in unrestricted cash and
equivalents that the company reported at this time last year.
Innodata Isogen attributed its results in large part to the
unexpected early termination of a large project by an ongoing client,
the completion of another large project for a different client and to
delays in the start-up of a new project for yet another client.
"We understand where we need to make progress," said Jack Abuhoff,
chairman and CEO of Innodata Isogen. "Project-based work, especially
when concentrated in large chunks, can create revenue choppiness,
which can hurt profitability in the short-term and distract from the
fundamental strength of our business model overall."
Innodata Isogen will continue to invest in business development
initiatives aimed at increasing and diversifying the company's client
roster and lessening project concentration, Abuhoff asserted.
Abuhoff noted that he expected that second quarter 2005 results
will likely be lower than first quarter 2005 results. But Abuhoff also
said that the company is growing its business development
infrastructure to drive improved performance in the second half of
this year.
Timing of Conference Call with Q&A
Innodata Isogen will conduct an earnings conference call,
including a question & answer period, at 11:00 AM ET today. You can
participate in this call by dialing the following call-in numbers:
1-800-289-0493 (Domestic)
1-913-981-5510 (International)
1-888-203-1112 (Domestic Replay)
1-719-457-0820 (International Replay)
Pass code on Replay only: 6384203
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 STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended
March 31,
2005 2004
---- ----
REVENUES $11,190 $12,157
-------- --------
OPERATING COSTS AND EXPENSES:
Direct operating expenses 8,203 7,775
Selling and administrative expenses 2,684 2,254
Bad debt recovery - net - (963)
Interest (income) expense - net (81) 1
-------- --------
Total 10,806 9,067
-------- --------
INCOME BEFORE PROVISION FOR INCOME TAXES 384 3,090
PROVISION FOR INCOME TAXES 85 1,010
-------- --------
NET INCOME $299 $2,080
======== ========
BASIC INCOME PER SHARE $.01 $.09
======== ========
WEIGHTED AVERAGE SHARES OUTSTANDING 22,691 21,952
======== ========
DILUTED INCOME PER SHARE $.01 $.08
======== ========
ADJUSTED DILUTIVE SHARES OUTSTANDING 25,110 24,527
======== ========
INNODATA ISOGEN, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in Thousands)
March 31, December 31,
2005 2004
---- ----
Unaudited Derived from
audited
financial
statements
ASSETS
CURRENT ASSETS:
Cash and equivalents $23,422 $20,663
Accounts receivable-net 6,058 8,019
Prepaid expenses and other current assets 882 1,757
Deferred income taxes 607 645
------------ ------------
Total current assets 30,969 31,084
PROPERTY AND EQUIPMENT - NET 4,275 4,559
OTHER ASSETS 969 893
GOODWILL 675 675
------------ ------------
TOTAL $36,888 $37,211
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable and accrued expenses $3,210 $3,412
Accrued salaries, wages and related benefits 3,884 3,979
Income and other taxes 984 1,304
Current portion of capital lease obligations 180 180
------------ ------------
Total current liabilities 8,258 8,875
DEFERRED INCOME TAXES 1,432 1,449
OBLIGATIONS UNDER CAPITAL LEASE 108 150
STOCKHOLDERS' EQUITY 27,090 26,737
------------ ------------
TOTAL $36,888 $37,211
============ ============
CONTACT: Innodata Isogen, Inc.
Al Girardi, 201-488-1200, ext. 5392
agirardi@innodata-isogen.com