ALPHARETTA, Ga., June 13, 2005 (PRIMEZONE) -- Optio Software (OTCBB:OPTO), a leading provider of document automation solutions to help organizations achieve unprecedented speed, accuracy, functionality and quality in their inbound and outbound document processes, today reported financial results for its first fiscal quarter ended April 30, 2005.
First Quarter Revenue and Cost of Revenue
For the first quarter, total revenue was $6.9 million, down 4 percent from $7.2 million in the prior year quarter. Software license revenues were $2.2 million in the three months ended April 30, 2005, compared to $2.9 million in the first quarter of the prior year.
Optio's subscription licensing contracts contributed $509,000 to the quarter ended April 30, 2005. Services and maintenance revenues declined 3 percent to $4.2 million for the three months ended April 30, 2005, compared to $4.3 million for the same period in fiscal 2005.
Total cost of revenue increased slightly to $1.8 million in the first quarter of fiscal 2006 from $1.7 million reported during the same quarter in the prior year.
Operating Expenses
Optio continued its investment in sales and marketing and research and development, reporting an increase in total operating expenses of 7 percent to $5.2 million during the first quarter of fiscal year 2006, compared to $4.9 million for the three months ended April 30, 2004.
Net Income (Loss)
Net loss for the first quarter of fiscal 2006 was $90,000 and diluted earnings per share (EPS) were $0.00, a decline from net income of $569,000 and diluted EPS of $0.02 in the prior-year quarter. The net loss for the first quarter of fiscal 2006 was the second net loss reported in the prior nine fiscal quarters. The company reported four straight quarters of profitability during fiscal 2005.
"We anticipated and planned for this small net loss resulting from our shift to the subscription licensing model in our healthcare market and our strategic investments in sales and marketing and research and development personnel and activities during the first quarter," said Wayne Cape, chairman, president and chief executive officer of Optio Software. "We believe these prudent investments are necessary to execute on our strategy, grow revenues and build on our success in the months and years ahead. We also believe our move to a subscription license contracts will help us boost market share in the healthcare market."
First Quarter Highlights and Business Metrics
-- Several significant software license transactions were closed
during the quarter, including sales to GE Infrastructure
Security, U.S. Department of Interior -- National Business
Center, and Mercy Health Partners.
-- Other notable sales during the quarter included: Huttig
Building Products, Thermos, LLC, LabOne and AAI Corporation.
-- Wray Community Hospital, an acute-care facility in Wray,
Colo., signed a five-year subscription license for Optio
QuickRecord(r) Suite electronic health record and Optio
MedEx(tm) forms management solutions.
-- Optio closed the quarter with $5.8 million in cash and cash
equivalents, compared to $5.4 million as of Jan. 31, 2005.
-- Cash flows from operations were $221,000.
-- The company had no outstanding balance on its line of credit
as of April 30, 2005.
-- Optio invested $170,000 more in direct marketing activities
than in the same quarter of the prior year.
-- Optio launched the Optio QuickRecord Suite at the 2005 Healthcare
Information and Management Systems Society (HIMSS) Annual
Conference and Exhibition in mid-February. The company also
announced at the HIMSS conference a new version of its MedEx
product that improves documents-on-demand and forms automation
performance.
-- Twenty new Optio employees were hired between April 30, 2004 and
April 30, 2005, including the additional employees gained with
the VertiSoft acquisition, bringing the company's total headcount
to 171 as of April 30, 2005 and strengthening Optio's research
and development, marketing and sales teams.
-- Five new members joined Optio's 2005-2006 Enterprise and
Healthcare Customer Advisory Boards, which offer insights and
provide feedback on product direction.
For further information, please contact:
Sheryl A. Roehl Director of Communications Optio Software, Inc. Tel: 770.576.3613 Email: sroehl@optiosoftware.com
About Optio Software
Optio Software provides document automation solutions to help organizations achieve unprecedented speed, accuracy, functionality and quality in their inbound and outbound document processes. More than 5,000 customers use Optio solutions to streamline business document-intensive processes and reduce costs as they extend their investments in hospital information systems (HIS) and enterprise resource planning (ERP) applications. Founded in 1981, Optio Software, headquartered in Alpharetta, Ga., maintains Europe, Middle East and Africa headquarters in Paris, and sales offices in Germany and the United Kingdom. More information about Optio Software (OTCBB:OPTO.OB) is available at OptioSoftware.com.
(c) Copyright 2005, Optio Software, Inc. All Rights Reserved. Optio is a registered trademark and Optio Imaging Solutions is a trademark of Optio Software, Inc. Other companies and products mentioned in this document are the property of their respective owners.
Forward Looking Statements
This press release includes statements and other matters that could be considered to be forward-looking and subject to a number of risks and uncertainties that could cause actual results to differ materially from expectations. Such forward-looking statements are made pursuant to the "safe-harbor" provisions of the Private Securities Litigation Reform Act of 1995 and are made based on management's current expectations or beliefs as well as assumptions made by, and information currently available to, management. Factors that might cause or contribute to such differences include, but are not limited to, risks associated with Optio's reliance on strategic marketing and reseller relationships, the collectibility of Optio's accounts receivable and note receivable (specifically, the M2 note receivable), fluctuations in operating results because of acquisitions or dispositions, failure to integrate new products and newly acquired companies, diversion of management resources relating to acquisitions, reduction in cash reserves relating to acquisitions, challenges relating to acquisitions and the possibility that this may cause Optio to no longer be profitable, the negative effect on Optio's earnings relating to the amortization or potential write-down of acquired assets or goodwill, failure to retain the business relationships with existing customers of acquisitions, changes in competition, changes in economic conditions in the U.S. and in other countries in which Optio currently does business (both general and relative to the technology industry), delays or inability in developing new or unique software, market acceptance of new products, the failure of new products to operate as anticipated, expectation of achieving and sustaining operating profits and earnings, including the timing of such cash flow and company performance, disputes regarding Optio's intellectual property, risks relating to the delisting of our stock, possible adverse results of pending or future litigation, or risks associated with Optio's international operations. In addition, other written or oral statements that constitute forward-looking statements may be made by or on behalf of Optio. These and additional factors are set forth in "Safe Harbor Compliance Statement for Forward-Looking Statements" included as Exhibit 99.1 to Optio's most recent Annual Report on Form 10-K. You should carefully review these risks and additional risks described in other documents Optio files from time to time with the Securities and Exchange Commission, including the Quarterly Report of Form 10-Q that Optio will file on or before June 14, 2005.
OPTIO SOFTWARE, INC.
Consolidated Statements of Operations
(in thousands, except per share data)
Three Months Ended
April 30,
----------------------------
2005 2004
------------ ------------
Revenue:
License fees $ 2,211 $ 2,881
Subscription revenue 509 --
Services, maintenance,
and other 4,196 4,325
------------ ------------
6,916 7,206
Cost of revenue:
License fees 182 149
Services, maintenance,
and other 1,615 1,586
------------ ------------
1,797 1,735
------------ ------------
5,119 5,471
Operating expenses:
Sales and marketing 2,861 2,695
Research and
development 1,278 1,085
General and
administrative 917 1,053
Depreciation and
amortization 188 71
------------ ------------
5,244 4,904
------------ ------------
Income (loss) from
operations (125) 567
Other income (expense):
Interest income 56 42
Interest expense (2) (4)
Other (1) 21
------------ ------------
53 59
------------ ------------
Income (loss) before
income taxes (72) 626
Income tax expense 18 57
------------ ------------
Net income (loss) (90) 569
============ ============
Net income (loss) per
share -- basic $ (0.00) $ 0.03
============ ============
Net income (loss) per
share -- diluted $ (0.00) $ 0.02
============ ============
Weighted average shares
outstanding -- basic 20,860,295 19,399,918
============ ============
Weighted average shares
outstanding -- diluted 20,860,295 23,002,374
============ ============
OPTIO SOFTWARE, INC.
Condensed Consolidated Balance Sheets
(in thousands)
April 30, January 31,
2005 2005
------- -------
ASSETS
Current Assets:
Cash and cash equivalents $ 5,797 $ 5,433
Accounts receivable, net 4,245 4,734
Note receivable from M2 376 353
Other current assets 630 430
------- -------
Total current assets 11,048 10,950
Property and equipment, net 699 668
Note receivable 1,904 2,008
Goodwill and other
intangible assets, net 3,709 3,778
Other assets 147 91
------- -------
Total assets $17,507 $17,495
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 897 $ 932
Other accrued liabilities 1,634 2,000
Deferred revenue 6,765 6,458
Current portion of debt
and capital lease
obligations 65 86
------- -------
Total current liabilities 9,361 9,476
Long-term portion of debt
and capital lease
obligations 7 7
Long-term accrued expenses 78 85
Shareholders' equity 8,061 7,927
------- -------
Total liabilities and
shareholders' equity $17,507 $17,495
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