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| Home
> News
& Events > Press Releases > 2001 |
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| Teaneck, NJ
- February 5, 2002 - Cognizant Technology
Solutions Corp. (Nasdaq: CTSH), a leading
application management and e-business
solutions provider, today announced financial
results for the fourth quarter and year
ended December 31, 2001.
Revenue for the fourth quarter increased
to $43.5 million, up 6 percent from $41.1
million in the fourth quarter of 2000.
Gross margin and operating margin for
the fourth quarter improved to 49.4 percent
and 20.8 percent, respectively from 48.8
percent and 19.2 percent, respectively
in the prior year.
Pro forma net income for the fourth quarter
increased to $5.9 million or $0.29 per
diluted share from $5.4 million or $0.27
per diluted share in the fourth quarter
of 2000. Pro forma amounts exclude the
effect of a one-time, non-cash, after-tax
charge of $1.2 million, related to an
impairment loss write-off of Questra,
the Company's only venture capital investment.
Net income for the fourth quarter of 2001,
inclusive of the one-time charge, was
$4.6 million, or $0.23 per diluted share.
Revenue for the year ended December 31,
2001 increased 30 percent to $177.8 million
from $137.0 million in 2000. Pro forma
net income for 2001 increased 32 percent
to $23.4 million, from $17.7 million in
the prior year. 2001 Pro forma EPS increased
32 percent to $1.15 per diluted share
from $0.87 per diluted share in 2000.
Net income for the year ended December
31, 2001, inclusive of the one-time charge,
increased to $22.2 million or $1.09 per
diluted share.
"Offshore application management
continued to move to the forefront of
corporate IT spending as a result of its
cost effectiveness and value added capabilities,"
said Kumar Mahadeva, Chairman and Chief
Executive Officer. "Cognizant's results
benefited from this mainstream acceptance
and resulted in 22 percent growth in application
management revenue during the fourth quarter
and a 43% increase for the full year.
Additionally, investments in our vertical
market strategy continue to bear fruit
as we experienced sequential growth in
the fourth quarter in our health care
and financial services practices. This
partially offset the substantial decline
in revenue from our travel industry clients.
We do not expect any further decline in
revenues from the travel segment."
"Our cash balance increased over
$5 million during the fourth quarter to
approximately $85 million as we continued
to generate significant cash flow from
operations. Also, DSOs remained strong
at 59 days," said Gordon Coburn,
Chief Financial Officer. "Additionally,
our customer base remains strong and loyal.
Over 80% of our fourth quarter revenue
came from customers who have utilized
our services for more than one year."
Coburn added, "Although spending
on development and integration projects
remains weak, we continue to see strong
demand for offshore outsourcing services
and as a result expect to resume sequential
revenue growth in the first quarter of
2002."
Conference Call
Cognizant Technology Solutions will host
a conference call today, Tuesday February
5, at 10:00 a.m. (eastern) to discuss
the Company's quarterly results. To listen
to the call please dial 706-679-3318.
The call will also be broadcast live via
the Internet at Cognizant's web site,
www.cognizant.com. Please go to the web
site at least fifteen minutes prior to
the call to register, download and install
any necessary audio software. A replay
will be made available on the web site
at www.cognizant.com or by calling 706-645-9291
and entering "2804625" from
two hours after the end of the call until
11:59 p.m. (EST) on February 12, 2002. |
| |
About Cognizant
Cognizant is a leading provider of custom
software development, integration and
maintenance services that link e-business
with core information systems for companies
worldwide. Cognizant operates under a
high quality, high value onsite/offshore
model that enables better, faster and
more cost effective development and deployment
of large-scale systems across a wide range
of transaction intensive business needs.
Its more than 3,900 employees are committed
to partnerships that sustain long-term,
proven value in order to win in today's
global marketplace. Cognizant was listed
as one of the ``Best Small Companies in
America,'' by Forbes and as the top solutions
provider and one of the top 200 Hot Companies
by Business Week. Cognizant has been assessed
at SEI/CMM Level 5, the highest possible
rating. For more information, visit Cognizant
on the web at www.cognizant.com.
|
| Certain statements
contained herein, including statements regarding
the development of the Company's services,
markets and future demand for the Company's
services, projections on future growth potential,
and other statements regarding matters that
are not historical facts, are forward-looking
statements (as defined in the Private Securities
Litigation Reform Act of 1995). Such forward-looking
statements include risks and uncertainties;
consequently, actual results may differ
materially from those expressed or implied
thereby. Factors that could cause actual
results to differ materially include, but
are not limited to, variability of quarterly
operating results, reliance on large projects,
concentration of revenue, ability to attract
and retain professional staff, dependence
on key personnel, ability to manage growth
effectively, risks associated with rapid
technological advances, risks associated
with possible acquisitions, risks associated
with the Company's strategic partnerships,
various project-associated risks, substantial
competition, general economic conditions,
risks associated with intellectual property
rights, risks associated with international
operations and other risk factors listed
from time to time in the Company's filings
and reports with the Securities and Exchange
Commission. |
| COGNIZANT
TECHNOLOGY SOLUTIONS CORPORATION |
| CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS (Unaudited) |
| (In thousands, except
per share data) |
| |
Three Months Ended |
Nine
Months Ended |
|
December 31, |
December
31, |
|
2001 |
2000 |
2001 |
2000 |
| Revenues |
$38,166 |
$37,766 |
$158,969 |
$122,758 |
| Revenues-related party |
5,295 |
3,287 |
18,809 |
14,273 |
| Total revenues |
43,461 |
41,053 |
177,778 |
137,031 |
| Cost of revenues |
21,989 |
21,012 |
90,848 |
70,437 |
| Gross profit |
21,472 |
20,041 |
86,930 |
66,594 |
| Selling, general
and administrative expenses |
10,636 |
10,891 |
44,942 |
35,959 |
| Depreciation and amortization expense |
1,802 |
1,265 |
6,368 |
4,507 |
| Income from operations |
9,034 |
7,885 |
35,620 |
26,128 |
| Other income: |
| Interest income |
495 |
870 |
2,501 |
2,649 |
| Other, net |
(163) |
(98) |
(767) |
(530) |
| Total other income |
332 |
772 |
1,734 |
2,119 |
| Income before provision for income
taxes |
9,366 |
8,657 |
37,354 |
28,247 |
| Provision for income taxes |
(3,502) |
(3,237) |
(13,970) |
(10,564) |
| Pro forma Net income |
5,864 |
5,420 |
23,384 |
17,683 |
| Impairment loss on Investment,
net of tax benefit |
(1,224) |
- |
(1,224) |
- |
| Net income |
4,640 |
5,420 |
22,160 |
17,683 |
| Pro forma Basic EPS |
0.30 |
0.29 |
1.23 |
0.95 |
| Pro forma Diluted EPS |
0.29 |
0.27 |
1.15 |
0.87 |
| Basic earnings per share |
0.24 |
0.29 |
1.17 |
0.95 |
| Diluted earnings per share |
0.23 |
0.27 |
1.09 |
0.87 |
| Weighted average number of common
shares outstanding |
19,283 |
18,634 |
19,017 |
18,565 |
| Weighted average number of common
and dilutive shares outstanding * |
20,284 |
20,118 |
20,371 |
20,256 |
|
| |
| COGNIZANT TECHNOLOGY
SOLUTIONS CORPORATION |
| CONDENSED CONSOLIDATED
STATEMENT OF FINANCIAL POSITION
(Unaudited) |
| (In thousands) |
| |
December
31, 2001 |
December
31, 2000 |
| Assets |
| Current Assets |
|
|
| Cash and cash equivalents |
$84,977 |
$61,976 |
| Trade accounts receivable, net
of allowances of $882 and $516 respectively |
21,063 |
19,187 |
| Trade accounts receivable - related
party |
1,481 |
1,361 |
| Unbilled Accounts Receivable |
5,005 |
1,941 |
| Unbilled Accounts Receivable -
related party |
417 |
-- |
| Other current assets |
4,392 |
3,758 |
| Total Current Assets |
117,335 |
88,223 |
| Property and equipment - net |
24,339 |
15,937 |
| Goodwill - net |
878 |
1,195 |
| Investments |
- |
1,955 |
| Other assets |
2,431 |
2,230 |
| Total Assets |
144,983 |
109,540 |
| Liabilities
and Stockholders' Equity |
| Current Liabilities |
|
|
| Accounts payable |
$3,652 |
$2,849 |
| Accounts payable - related party |
- |
8 |
| Accrued and other current liabilities |
18,046 |
23,865 |
| Total Current Liabilities |
21,698 |
26,722 |
| Deferred income taxes |
24,493 |
16,702 |
| Total Liabilities |
46,191 |
43,424 |
| Stockholders' Equity |
98,792 |
66,116 |
| Total Liabilities
and Stockholders' Equity |
144,983 |
109,540 |
| *In
the first quarter, the Company began
to classify its investment in auction-rate
securities as short-term investments.
These investments were included
in cash and equivalents in previous
periods ($94.15) million as of December
31, 2004), and such amounts have
been reclassified in the accompanying
financial statements to conform
to the current period classification.
This change in classification had
no effect on the amounts of total
current assets, total assets, net
income or cash flow from operations
of the Company. |
|
|
Contact |
Investors
Contact |
Media
Contact |
Gordon Coburn
Chief Financial Officer
Cognizant Technology Solutions
201-678-2712 |
Corey Cutler/Ian
Hirsch |
Brian Maddox/Scot
Hoffman
Morgen-Walke Associates
212-850-5600 |
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