NORCROSS, Ga., May 15, 2007 (PRIME NEWSWIRE) -- Intelligent Systems Corporation (AMEX:INS), (www.intelsys.com) announced today the financial results for its first quarter ended March 31, 2007. Net loss for the first quarter of 2007 was $133,000 ($0.03 per basic and diluted share) compared to a net loss of $445,000 ($0.10 per basic and diluted share) for the corresponding period in 2006.
Revenue from product sales in the first quarter of 2007 was $3.1 million, a 67 percent increase over the first quarter of 2006, while revenue from services declined by 68 percent to $963,000 in the quarter ended March 31, 2007 compared to the first quarter of 2006. Overall, the company reported total revenue of $4.0 million in the quarter ended March 31, 2007 compared to total revenue of $4.9 million in the quarter ended March 31, 2006.
The period-to-period increase in product revenue reflects growth in international sales of the ChemFree subsidiary products as well as new license revenue recognized by the CoreCard Software subsidiary. The period-to-period decline in services revenue is mainly due to an unusually large multi-year software services contract that was recognized in the first quarter of 2006. Consolidated operating expenses declined by 15 percent in the first quarter of 2007, lowering the loss from operations to $274,000 compared to a loss from operations of $702,000 in the first quarter of 2006.
As previously disclosed, as a result of the sale of the company's QS Technologies business in July of 2006, the company classified the QS business as Discontinued Operations and the financial results for 2006 have been reclassified to conform to this presentation. In the quarter ended March 31, 2007, the company reported an additional gain of $97,000 on the sale of the QS business following completion of an earn-out period in which there were no proposed adjustments by the buyer.
About Intelligent Systems Corporation
For over thirty years, Intelligent Systems Corporation (AMEX:INS) has identified, created, operated and grown early stage technology companies. The company has operations and investments in the information technology and industrial products industries. The company's consolidated subsidiaries include VISaer, Inc. (www.visaer.com), CoreCard Software, Inc. (www.corecard.com), (both software companies) and ChemFree Corporation (www.chemfree.com) (an industrial products company). Further information is available on the company's website at www.intelsys.com, or by calling the company at 770/381-2900.
In addition to historical information, this news release may contain forward-looking statements relating to Intelligent Systems and its subsidiary and affiliated companies. These statements include all statements that are not statements of historical fact regarding the intent, belief or expectations of Intelligent Systems and its management with respect to, among other things, results of operations, product plans, and financial condition. The words "may," "will," "anticipate," "believe," "intend," "expect," "estimate," "plan," "strategy" and similar expressions are intended to identify forward-looking statements. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties and that actual results may differ materially from those contemplated by such forward-looking statements. The Company does not undertake to update or revise any forward-looking statements whether as a result of new developments or otherwise. Among the factors that could cause actual results to differ materially from those indicated by such forward-looking statements are delays in product development, undetected software errors, competitive pressures, changes in customers' requirements or financial condition, market acceptance of products and services, changes in financial markets, changes in the performance, financial condition or valuation of affiliate companies, the risks associated with investments in privately-held early stage companies, the impact of events such as rising gas prices that could impact the aviation industry, the price of certain plastics components and the company's other worldwide market opportunities, other geopolitical or military actions, and general economic conditions, particularly those that cause businesses to delay or cancel purchase decisions.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share amounts)
Three Months Ended March 31,
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2007 2006
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Revenue
Products $ 3,086 $ 1,852
Services 963 3,024
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Total revenue 4,049 4,876
Total cost of revenue 1,642 2,434
Expenses
Marketing 437 521
General & administrative 980 1,102
Research & development 1,264 1,521
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Loss from operations (274) (702)
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Interest income (expense), net 63 (28)
Investment income (loss), net (11) 5
Equity in income of
affiliate companies 1 72
Other income (loss), net (9) 34
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Loss from continuing operations (230) (619)
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Income from discontinued
operations -- 174
Gain on sale of discontinued
operations 97 --
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Net loss $ (133) $ (445)
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Loss per share - continuing
operations: basic and diluted $ (0.05) $ (0.14)
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Income per share - discontinued
operations: basic and diluted 0.02 0.04
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Net loss per share:
basic and diluted $ (0.03) $ (0.10)
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Basic weighted average
shares outstanding 4,478,971 4,478,971
Diluted weighted average
shares outstanding 4,582,666 4,478,971
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CONSOLIDATED BALANCE SHEETS
(in thousands)
March 31, December 31,
2007 2006
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ASSETS (Unaudited)
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Current assets:
Cash $ 3,576 $ 2,136
Accounts receivable, net 2,238 2,006
Notes and interest receivable,
current portion 538 3,445
Inventories 934 904
Other current assets 963 1,072
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Total current assets 8,249 9,563
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Long-term investments 1,175 1,174
Notes receivable, net of
current portion 722 841
Property and equipment, net 1,161 1,009
Goodwill, net 2,047 2,047
Other intangibles, net 347 359
Other assets, net 17 17
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Total assets $ 13,718 $ 15,010
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LIABILITIES AND STOCKHOLDERS' EQUITY
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Current liabilities:
Accounts payable $ 1,156 $ 1,558
Deferred revenue 2,259 3,094
Accrued payroll 953 974
Accrued expenses and other
current liabilities 1,233 1,088
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Total current liabilities 5,601 6,714
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Other long-term liabilities 293 356
Minority interest 1,516 1,516
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Total stockholders' equity 6,308 6,424
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Total liabilities and
stockholders' equity $ 13,718 $ 15,010
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