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& Events > Press Releases > 2002 |
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Teaneck, NJ
- July 15, 2002 - Cognizant Technology
Solutions Corp. (Nasdaq: CTSH), a leading
application management and e-business
solutions provider, today announced financial
results for the second quarter ended June
30, 2002.
Revenue for the second quarter increased
to $54.4 million, up 20 percent from $45.4
million in the second quarter of 2001,
and up 17% sequentially from the first
quarter of 2002. Net income for the second
quarter increased to $8.6 million, or
$0.41 per diluted share, from $5.8 million,
or $0.29 per diluted share, in the second
quarter of 2001.
Operating Margin for the quarter was
19.7% up from 19.5% in the year ago quarter.
Gross margin was 46.0%, compared with
48.5% in the year ago quarter, and 48.0%
in the first quarter of 2002. The decline
in gross margin was primarily due to increased
bonus accruals driven by the Company's
higher than expected revenue performance.
"The increasing recognition of Cognizant's
market-leading service offerings combined
with the fuller acceptance of the offshore
outsourcing model, accelerated our results
beyond our own internal expectations this
quarter," said Kumar Mahadeva, Chairman
and Chief Executive Officer. "Application
management revenues increased 21% sequentially
and 34% year over year, and we also recorded
a modest rebound in development revenues
from existing customers. Twelve new customers
were signed this quarter, primarily large
blue chip names with substantial revenue
potential, and our new deal pipeline remains
strong."
"During the second quarter, our balance
sheet remained strong with approximately
$104 million in cash as we generated over
$12 million in cash flow from operations,"
said Gordon Coburn, Chief Financial Officer.
"Furthermore, client satisfaction remained
high as approximately 90 percent of our
second quarter revenue came from customers
who have employed our services for more
than one year. Utilization increased to
76% worldwide, which accelerated the Company's
hiring plans. We ended the quarter with
headcount of 4,240, a 10% sequential increase."
Conference Call
Cognizant will host a conference call
tomorrow, Tuesday, July 16, at 10:00 a.m.
(EST) to discuss the Company's quarterly
results. To listen to the call please
dial 706-645-0156. 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 "4697802"
from two hours after the end of the call
until 11:59 p.m. (EST) on July 23, 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 4,200 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 June 30 |
Six
Months Ended June 30, |
| 2002 |
2001 |
2002 |
2001 |
| Revenues |
$49,146 |
40,414 |
90,796 |
80,400 |
| Revenues-related party |
5,212 |
4,997 |
10,046 |
8,415 |
| Total revenues |
54,358 |
45,411 |
100,842 |
88,815 |
| Cost of revenues |
29,348 |
23,381 |
53,537 |
45,750 |
| Gross profit |
25,010 |
22,030 |
47,305 |
43,065 |
| Selling, general and administrative
expenses |
12,561 |
11,657 |
23,783 |
22,865 |
| Depreciation and amortization expense |
1,747 |
1,499 |
3,674 |
2,937 |
| Income from operations |
10,702 |
8,874 |
19,848 |
17,263 |
| Other income: |
| Interest income |
405 |
617 |
834 |
1,363 |
| Other expense, net |
46 |
(150) |
(113) |
(395) |
| Total other income |
451 |
467 |
721 |
968 |
| Income before provision for income
taxes |
11,153 |
9,341 |
20,569 |
18,231 |
| Provision for income taxes |
(2,506) |
(3,494) |
(4,813) |
(6,819) |
| Net income |
8647 |
5,847 |
15,756 |
11,412 |
| Basic earnings per share |
$ 0.44 |
0.31 |
0.80 |
0.61 |
| Diluted earnings per share |
$ 0.41 |
0.29 |
0.75 |
0.56 |
| Weighted average number of common
shares outstanding * |
19,579 |
18,913 |
19,579 |
18,801 |
| Weighted average number of common
and dilutive shares outstanding * |
21,055 |
20,464 |
20,918 |
20,329 |
|
| |
| COGNIZANT TECHNOLOGY
SOLUTIONS CORPORATION |
| CONDENSED CONSOLIDATED
STATEMENT OF FINANCIAL POSITION
(Unaudited) |
| (In thousands) |
| |
June
30, 2002 |
December
31 2000 |
| Assets |
| Current Assets |
|
|
| Cash and cash equivalents |
$103,843 |
84,977 |
| Trade accounts receivable, net
of allowances of $760 and $882 respectively |
28,671 |
21,063 |
| Trade accounts receivable - related
party |
2,411 |
1,481 |
| Unbilled Accounts Receivable |
6,193 |
5,005 |
| Unbilled Accounts Receivable -
related party |
840 |
417 |
| Other current assets |
7,986 |
4,392 |
| Total Current Assets |
149,944 |
117,335 |
| Property and equipment - net |
25,165 |
24,339 |
| Goodwill - net |
878 |
878 |
| Other assets |
4,805 |
2,431 |
| Total Assets |
$ 180,792 |
$ 144,983 |
| Liabilities
and Stockholders' Equity |
| Current Liabilities |
| Accounts payable |
4,607 |
3,652 |
| Accrued and other current liabilities |
27,501 |
18,046 |
| Total Current Liabilities |
32,108 |
21,698 |
| Deferred income taxes |
25,591 |
24,493 |
| Total Liabilities |
57,699 |
46,191 |
| Stockholders' Equity |
123,093 |
98,792 |
| Total Liabilities
and Stockholders' Equity |
$ 180,792 |
$ 144,983 |
| *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/Stephanie
Prince |
Brian Maddox/Scot
Hoffman
Morgen-Walke Associates
212-850-5600 |
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