Exhibit 99.1
Creative Computer Applications, Inc. Reports Results of Operations for
the Third Fiscal Quarter Ended September 30, 2005
CALABASAS, Calif.--(BUSINESS WIRE)--Nov. 14, 2005--Creative
Computer Applications, Inc. or CCA (AMEX:CAP), a provider of Clinical
Information Systems (CIS) for hospital and clinic-based laboratories,
pharmacies, and radiology departments, announced today the results of
operations for its third fiscal quarter and nine-month period ended
September 30, 2005.
Sales for the third fiscal quarter ended September 30, 2005 were
$1,727,672 compared to sales of $2,285,208 for the comparable quarter
ended September 30, 2004. The Company incurred a net loss of
$1,073,152 or $.31 basic and diluted earnings per share, for the
current fiscal quarter, compared to income of $312,066, or $.09 basic
and diluted earnings per share, for the comparable quarter ended
September 30, 2004.
Sales for the nine-month period ended September 30, 2005 were
$5,108,967 compared to sales of $6,038,902 for the comparable
nine-month period one year ago. The Company incurred a net loss of
$1,498,654 or $.44 basic and diluted loss per share, for the current
nine-month period, compared to net income of $448,877, or $.14 basic
and $.13 diluted earnings per share, for the comparable nine-month
period one year ago. Included in the net loss for the quarter and nine
month period is an adjustment of $793,877 to the Company's deferred
tax asset.
Steven M. Besbeck, President and CEO, stated, "CCA's results of
operation for our third fiscal quarter over the comparable period were
impacted by continued legal, accounting, consultant, and other
expenses associated with our pending merger with StorCOMM, Inc., and a
reduction in sales primarily attributable to an unanticipated turnover
in our sales department. As previously announced, we appointed a new
Vice President of Sales effective July 1, 2005 and have now recruited
a new sales force.
"Since the beginning of fiscal year 2005, we have been involved in
activities related to the proposed merger with StorCOMM. We originally
anticipated that the merger would be completed in the summer of 2005.
However, due to a number of factors, the merger completion date was
extended and we now expect it to close on or about November 21, 2005,
subject to shareholder approval. In order to mitigate the delays in
completing the merger and put the combined company in the best
position to immediately execute its integration plan and launch new
products following the merger, we determined it was in the best
interests of the Company to proceed with the development of its
integration plan with StorCOMM prior to the completion of the merger.
This required significant investment in infrastructure and product
development. This investment has been financed through the utilization
of working capital and short-term borrowings, which we anticipate
repaying once the merger and the private placement of $3,000,000 in
common stock and warrants are consummated. The costs associated with
this investment have been expensed as incurred, which increased the
operating expenses of CCA during the current quarter and nine-month
period ended September 30, 2005, and is more fully discussed in our
quarterly report on Form 10QSB. While some of these expenses are
non-recurring, others including the addition of key personnel in
product management, regulatory affairs, and product development, which
we considered be essential additions to management in order to assure
the success of the Company's integration strategy.
"The operating losses incurred by the Company during the
nine-month period ended September 30, 2005 were primarily a result of
expenses incurred in connection with the proposed merger with StorCOMM
and the related integration plan. Due to the accumulated net losses
incurred by the Company, we have established an additional valuation
allowance against our net deferred tax asset. Management anticipated
the net deferred tax asset would have been eliminated in any case as a
result of the accounting for the purchase transaction upon the
completion of the merger as described in the Company's registration
statement on Form S-4 filed on October 3, 2005."
Creative Computer Applications, Inc.
Operating Results (Unaudited)
Three Months Ended Nine Months Ended
----------------------- -----------------------
September September September September
30, 2005 30, 2004 30, 2005 30, 2004
----------- ----------- ----------- -----------
Net Sales and Service
Revenues $1,727,672 $2,285,208 $5,108,967 $6,038,902
Gross Margin 919,001 1,456,126 2,651,035 3,426,718
Operating Income
(Loss) (279,159) 427,447 (706,042) 564,085
Provision for Income
Taxes 793,877 117,763 793,877 117,763
Net Income (Loss) (1,073,152) 312,066 (1,498,654) 448,877
Basic Earnings (Loss)
Per Share (.31) .09 (.44) .14
Diluted Earnings
(Loss) Per Share (.31) .09 (.44) .13
Average Shares
Outstanding (Basic) 3,465,900 3,318,900 3,401,011 3,318,900
(Diluted) 3,465,900 3,369,832 3,401,011 3,405,437
About Creative Computer Applications, Inc.
CCA is a healthcare information technology and service provider
that provides software and browser-based solutions, specializing in
Clinical Information Systems (CIS) for hospital and clinic-based
laboratories, pharmacies, and imaging departments. Its primary
products, CyberLAB(R), CyberMED(R) and CyberRAD(R) are highly
functional, scalable, and can be deployed in a variety of healthcare
settings. CCA's systems are deployed in more than 500 sites. For more
information about CCA, its products and services, visit
http://www.ccainc.com/
Safe Harbor Statement
This press release may include forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995,
including statements related to anticipated revenues, expenses,
earnings, operating cash flows, the outlook for CCA's markets and the
demand for its products. Forward-looking statements are not guarantees
of future performance and are inherently subject to uncertainties and
other factors which could cause actual results to differ materially
from the forward-looking statement. Such statements are based upon,
among other things, assumptions made by, and information currently
available to, management, including management's own knowledge and
assessment of the Company's industry and competition. Factors that
could cause CCA's actual results to differ materially from these
forward-looking statements include among others: whether the merger
with StorCOMM will be completed; if the merger is completed, whether
the combined company will realize the potential benefits of the
merger; the competitive environment; unexpected technical and
marketing difficulties inherent in major product development efforts
such as those described about CyberLAB 7.0; the potential need for
changes in our long-term strategy in response to future developments;
future advances in clinical information technology and procedures, as
well as potential changes in government regulations and healthcare
policies, both of which could adversely affect the economics of the
products offered by CCA; and rapid technological change in the
microelectronics and software industries. The Company refers
interested persons to its most recent Annual Report on Form 10-KSB and
its other SEC filings for a description of additional uncertainties
and factors, which may affect forward-looking statements. The Company
assumes no duty to update its forward-looking statements.
CONTACT: Creative Computer Applications, Inc.
Steven M. Besbeck, 818-880-6700 X-252