Business Services Industry
IHS Inc. Announces First Quarter 2006 Results Driven By Eleven Percent Revenue Growth
Business Wire, March 28, 2006
IHS INC.
CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per-share amounts)
February 28, November 30,
2006 2005
------------- -------------
(Unaudited)
Assets
Current assets:
Cash and cash equivalents $125,729 $132,365
Short-term investments 25,853 27,223
Accounts receivable, net 146,268 136,950
Deferred subscription costs 31,022 27,918
Deferred income taxes 9,547 11,351
Other 9,149 10,638
------------- -------------
Total current assets 347,568 346,445
Non-current assets:
Property and equipment, net 48,462 46,580
Intangible assets, net 42,514 27,456
Goodwill, net 320,120 296,394
Prepaid pension asset 89,899 88,516
Other 1,770 1,765
------------- -------------
Total non-current assets 502,765 460,711
------------- -------------
Total assets $850,333 $807,156
============= =============
Liabilities and stockholders' equity
Current liabilities:
Short-term debt $500 $--
Accounts payable 42,487 41,625
Accrued compensation 13,712 20,135
Accrued royalties 24,218 26,139
Other accrued expenses 28,521 34,975
Income tax payable 7,144 7,726
Deferred subscription revenue 183,443 149,552
Risk management liabilities -- 2,705
------------- -------------
Total current liabilities 300,025 282,857
Long-term debt 249 262
Accrued pension liability 7,303 6,824
Accrued post-retirement benefits 20,563 20,278
Deferred income taxes 14,066 15,044
Other liabilities 7,890 4,402
Minority interests 337 309
Commitments and contingencies
Stockholders' equity:
Class A common stock, $0.01 par value per
share, 80,000,000 shares authorized,
44,794,672 and 44,078,231 issued and
outstanding at February 28, 2006 and
November 30, 2005, respectively 448 441
Class B common stock, $0.01 par value per
share, 13,750,000 shares authorized,
issued and outstanding at February 28,
2006 and November 30, 2005 138 138
Additional paid-in capital 171,668 168,196
Retained earnings 357,148 343,684
Accumulated other comprehensive loss (7,119) (10,486)
Unearned compensation (22,383) (24,793)
------------- -------------
Total stockholders' equity 499,900 477,180
------------- -------------
Total liabilities and stockholders' equity $850,333 $807,156
============= =============
IHS INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per-share amounts)
Three Months Ended
February 28,
---------------------
2006 2005
--------- ---------
(Unaudited)
Revenue:
Products $106,582 $97,325
Services 23,284 19,658
--------- ---------
Total revenue 129,866 116,983
Operating expenses:
Cost of revenue:
Products 44,620 42,861
Services 15,148 12,518
Compensation expense related to equity awards 1,095 79
--------- ---------
Total cost of revenue 60,863 55,458
Selling, general and administrative 42,804 40,559
Depreciation and amortization 3,370 2,907
Restructuring and other charges 2 --
Compensation expense related to equity awards 2,571 1,195
Gain on sales of assets, net -- (617)
Net periodic pension and post-retirement
benefits (726) (931)
Earnings in unconsolidated subsidiaries (28) (28)
Other income, net (403) (319)
--------- ---------
Total operating expenses 108,453 98,224
--------- ---------
Operating income 21,413 18,759
Interest income 914 718
Interest expense (85) (502)
--------- ---------
Non-operating income, net 829 216
--------- ---------
Income from continuing operations before income
taxes and minority interests 22,242 18,975
Provision for income taxes (7,473) (5,406)
--------- ---------
Income from continuing operations before minority
interests 14,769 13,569
Minority interests (25) 7
--------- ---------
Income from continuing operations 14,744 13,576
Discontinued operations:
Loss from discontinued operations, net (1,280) (443)
--------- ---------
Net income $13,464 $13,133
========= =========
Income from continuing operations per share:
Basic (Class A and Class B common stock) $0.26 $0.25
========= =========
Diluted (Class A and Class B common stock) $0.26 $0.24
========= =========
Loss from discontinued operations per share:
Basic (Class A and Class B common stock) $(0.02) $(0.01)
========= =========
Diluted (Class A and Class B common stock) $(0.02) $(0.01)
========= =========
Net income per share:
Basic (Class A and Class B common stock) $0.24 $0.24
========= =========
Diluted (Class A and Class B common stock) $0.24 $0.23
========= =========
Weighted average shares:
Basic (Class A common stock) 42,125 41,256
========= =========
Basic (Class B common stock) 13,750 13,750
========= =========
Diluted (Class A common stock) 56,062 56,151
========= =========
Diluted (Class B common stock) 13,750 13,750
========= =========
IHS INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
Three Months Ended
February 28,
-------------------
2006 2005
--------- ---------
(Unaudited)
Operating activities
Net income $13,464 $13,133
Reconciliation of net income to net cash provided
by operating activities:
Depreciation and amortization 3,370 2,967
Compensation expense related to equity awards
(non-cash portion) 3,920 1,274
Gain on sales of assets, net -- (617)
Impairment of assets of discontinued operations 1,012 --
Net periodic pension and post-retirement benefits
income (726) (931)
Minority interests 25 (7)
Deferred income taxes 702 (30)
Change in assets and liabilities:
Accounts receivable, net (10,183) (8,402)
Other current assets (1,658) (2,063)
Accounts payable 387 (2,051)
Accrued expenses (15,629) (15,927)
Income taxes (601) 492
Deferred subscription revenue 28,425 23,283
--------- ---------
Net cash provided by operating activities 22,508 11,121
Investing activities
Capital expenditures on property and equipment (2,368) (930)
Change in other assets 1,991 (949)
Purchase of investments (5,113) --
Sales and maturities of investments 6,458 --
Acquisitions of businesses, net of cash acquired (32,976) (875)
--------- ---------
Net cash used in investing activities (32,008) (2,754)
Financing activities
Net payments on debt (16) (17)
Tax benefit from equity compensation plans 1,969 --
--------- ---------
Net cash provided by (used in) financing activities 1,953 (17)
--------- ---------
Foreign exchange impact on cash balance 911 (87)
--------- ---------
Net increase (decrease) in cash and cash
equivalents (6,636) 8,263
Cash and cash equivalents at the beginning of the
year 132,365 124,452
--------- ---------
Cash and cash equivalents at the end of the year $125,729 $132,715
========= =========
IHS INC.
RECONCILIATIONS OF NON-GAAP FINANCIAL MEASUREMENTS TO
MOST DIRECTLY COMPARABLE GAAP FINANCIAL MEASUREMENTS
(In thousands)
Three Months Ended
February 28,
------------------
2006 2005
-------- --------
(Unaudited)
Energy operating income $16,148 $12,283
Engineering operating income 8,225 6,202
-------- --------
Total segment operating income 24,373 18,485
Adjustments:
Corporate-level restructuring and other charges (20) --
Compensation expense related to equity awards (3,666) (1,274)
Gain on sales of corporate assets, net -- 617
Net periodic pension and post-retirement benefits 726 931
-------- --------
Operating income $21,413 $18,759
======== ========
Three Months Ended February 28, 2006
---------------------------------------------
Energy Engineering Adjustments Consolidated
-------- ----------- ----------- ------------
(Unaudited)
Operating income $16,148 $8,225 $(2,960) $21,413
Adjustments:
Allocation of corporate
costs 3,045 3,045 (6,090) --
Depreciation and
amortization 1,701 1,460 209 3,370
Restructuring and other
charges -- (18) 20 2
Compensation expense
related to equity
awards -- -- 3,666 3,666
Net periodic pension and
post-retirement
benefits -- -- (726) (726)
Minority interest -- (25) -- (25)
-------- ----------- ----------- ------------
Adjusted EBITDA $20,894 $12,687 $(5,881) $27,700
======== =========== =========== ============
Three Months Ended February 28, 2005
---------------------------------------------
Energy Engineering Adjustments Consolidated
-------- ----------- ----------- ------------
(Unaudited)
Operating income $12,283 $6,202 $274 $18,759
Adjustments:
Allocation of corporate
costs 2,399 2,399 (4,798) --
Depreciation and
amortization 1,672 1,040 195 2,907
Compensation expense
related to equity
awards -- -- 1,274 1,274
Gain on sale of assets -- -- (617) (617)
Net periodic pension and
post-retirement
benefits -- -- (931) (931)
Minority interest -- 7 -- 7
-------- ----------- ----------- ------------
Adjusted EBITDA $16,354 $9,648 $(4,603) $21,399
======== =========== =========== ============
IHS INC.
RECONCILIATIONS OF NON-GAAP FINANCIAL MEASUREMENTS TO
MOST DIRECTLY COMPARABLE GAAP FINANCIAL MEASUREMENTS
(In thousands)
Three Months Ended
February 28,
-------------------
2006 2005
--------- ---------
(Unaudited)
Net income $13,464 $13,133
Interest income (914) (718)
Interest expense 85 502
Provision for income taxes 7,473 5,406
Depreciation and amortization 3,370 2,907
--------- ---------
EBITDA 23,478 21,230
Compensation expense related to equity awards 3,666 1,274
Restructuring and other charges 2 --
Gain on sales of assets, net -- (617)
Net periodic pension and post-retirement benefits
income (726) (931)
Loss from discontinued operations, net 1,280 443
--------- ---------
Adjusted EBITDA $27,700 $21,399
========= =========
Three Months Ended
February 28,
-------------------
2006 2005
--------- ---------
(Unaudited)
Net cash provided by operating activities $22,508 $11,121
Capital expenditures on property and equipment (2,368) (930)
--------- ---------
Free cash flow $20,140 $10,191
========= =========
IHS INC.
SUPPLEMENTAL INFORMATION
(In thousands, except per-share amounts)
Three Months Ended February 28,
------------------------------------------
2006 2005
-------------------- --------------------
After-tax Per share After-tax Per share
---------- --------- ---------- ---------
(Unaudited)
Compensation expense related
to equity awards $(2,309) $(0.04) $(803) $(0.02)
Gain on sales of assets, net -- -- 383 0.01
Net periodic pension and
post-retirement benefits 420 0.01 543 0.01
Loss from discontinued
operations, net (1,280) (0.03) (443) (0.01)
COPYRIGHT 2006 Business Wire
COPYRIGHT 2008 Gale, Cengage Learning
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