NORCROSS, Ga., Aug. 13, 2007 (PRIME NEWSWIRE) -- Intelligent Systems Corporation (AMEX:INS) (www.intelsys.com) announced today the financial results for its second quarter and year-to-date periods ended June 30, 2007.
In the quarter ended June 30, 2007, total revenue was $3.9 million compared to total revenue of $3.6 million in the quarter ended June 30, 2006, an increase of 9 percent. Revenue from product sales in the second quarter of 2007 was $2.6 million, a 10 percent increase over the second quarter of 2006, while revenue from services grew by 6 percent to $1.3 million in the quarter ended June 30, 2007 compared to $1.2 million in the second quarter of 2006.
For the six month period ended June 30, 2007, total revenue was $7.9 million compared to $8.4 million in the six month period in 2006. In 2007, year-to-date product revenue grew by 35 percent year-over-year to $5.7 million. However, year-to-date service revenue in 2007 declined to $2.2 million compared to $4.2 million in the six month period ended June 30, 2006.
The period-to-period increase in product revenue in both the three and six month periods ended June 30, 2007 reflects strong growth in sales of the ChemFree subsidiary products, as well as new license revenue recognized by the CoreCard Software subsidiary in the first quarter of 2007. The decline in 2007 year-to-date services revenue is mainly due to an unusually large $1.8 million multi-year software services contract that was recognized in the first quarter of 2006.
Net loss for the second quarter of 2007 was $922,000 ($0.21 per basic and diluted share) compared to a net loss of $776,000 ($0.17 per basic and diluted share) for the corresponding period in 2006. For the six month period ended June 30, 2007, net loss was $1.1 million ($0.24 per basic and diluted share) compared to a net loss of $1.2 million ($0.27 per basic and diluted share) in the comparable period in 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 six month period ended June 30, 2007, the company reported an additional gain of $97,000 on the sale of the QS discontinued operations following completion of an earn-out period in which there were no proposed adjustments by the buyer.
The company expects to file its Form 10-QSB for the quarter ended June 30, 2007 with the Securities and Exchange by the end of the day today. For additional information about the company's reported results, investors will be able to access the Form 10-QSB on the company's website at www.intelsys.com or at the SEC site, www.sec.gov. In keeping with prior practice, the company will schedule investor conference calls from time to time as appropriate and will announce future conference calls in advance.
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
(unaudited; in thousands, except share and per share amounts)
Three Months Ended Six Months Ended
June 30, June 30,
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2007 2006 2007 2006
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Revenue
Products $ 2,573 $ 2,340 $ 5,659 $ 4,192
Services 1,284 1,213 2,247 4,237
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Total revenue 3,857 3,553 7,906 8,429
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Cost of revenue
Products 1,496 1,227 2,566 2,227
Services 781 532 1,353 1,965
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Total cost of
revenue 2,277 1,759 3,919 4,192
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Expenses
Marketing 590 512 1,027 1,032
General &
administrative 918 863 1,898 1,966
Research &
development 1,164 1,368 2,428 2,889
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Loss from operations (1,092) (949) (1,366) (1,650)
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Other income (expense)
Interest income
(expense), net 34 (33) 97 (61)
Investment income, net 92 2 82 7
Equity in income of
affiliate companies 41 91 42 162
Other income (loss),
net 3 3 (7) 38
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Loss before income
taxes (922) (886) (1,152) (1,504)
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Income from
discontinued
operations -- 110 -- 283
Gain on sale of
discontinued
operations -- -- 97 --
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Net loss $ (922) $ (776) $ (1,055) $ (1,221)
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Loss per share from
continuing
operations $ (0.21) $ (0.19) $ (0.26) $ (0.33)
Income per share from
discontinued
operations 0.00 0.02 0.02 0.06
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Net loss per share:
Basic & diluted $ (0.21) $ (0.17) $ (0.24) $ (0.27)
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Basic and diluted
weighted average
common shares
outstanding 4,478,971 4,478,971 4,478,971 4,478,971
CONSOLIDATED BALANCE SHEETS
(in thousands)
June 30, December 31,
2007 2006
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ASSETS (Unaudited)
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Current assets:
Cash $ 2,338 $ 2,136
Accounts receivable, net 2,828 2,006
Notes and interest receivable, current portion 521 3,445
Inventories 1,112 904
Other current assets 482 1,072
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Total current assets 7,281 9,563
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Long-term investments 1,216 1,174
Notes receivable, net of current portion 600 841
Property and equipment, net 1,468 1,009
Goodwill, net 2,047 2,047
Other intangibles, net 336 359
Other assets, net 17 17
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Total assets $ 12,965 $ 15,010
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LIABILITIES AND STOCKHOLDERS' EQUITY
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Current liabilities:
Note payable $ 221 $ --
Accounts payable 1,558 1,558
Deferred revenue 2,051 3,094
Accrued payroll 931 974
Accrued expenses and other current liabilities 1,061 1,088
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Total current liabilities 5,822 6,714
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Other long-term liabilities 257 356
Minority interest 1,516 1,516
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Total stockholders' equity 5,370 6,424
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Total liabilities and stockholders' equity $ 12,965 $ 15,010
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