IRVINE,
Calif. — (BUSINESS WIRE) — October 29, 2002 — Quality Systems, Inc.
(Nasdaq: QSII - News) today announced the results of operations for its fiscal 2003 second quarter ended September 30, 2002.
The Company posted net revenues of $13.0 million in the second quarter, an increase of 24% from $10.5 million for the same quarter last year. The Company reported net income of $1,710,000, an increase of 51% over net income of $1,132,000 for the comparable quarter of the prior year. Fully diluted earnings per share reached $0.27 in the quarter, an increase of 50% over the fully diluted $0.18 per share earnings recorded in the same quarter last year.
The revenue, net income, and earnings per share results achieved in the quarter were records for the Company. Results in the quarter were driven by record revenue and profit in the Company�s NextGen Healthcare Information Systems division. For the quarter, the NextGen division posted record revenue of $8.6 million, up 37% over the same quarter of the prior year and record operating income of $2.1 million, up 144% over the prior-year quarter.
The Company will hold a conference call to discuss second-quarter results today, Tuesday, October 29 at 1:00 p.m. EDT (10:00 a.m. PDT). To participate in the conference call, please dial the following number five to ten minutes prior to the scheduled conference call time: (800) 452-1298. There is no pass code required for this call. If you are unable to participate in the call at this time, a replay will be available on Tuesday, October 29 at 1:00 p.m. PST, through Tuesday, November 5 at midnight PST. To access the replay dial (800) 642-1687 and enter the conference ID number 6162008. A transcript of the conference call will be made available on the QSII Web site (www.qsii.com).
Quality Systems and its NextGen Healthcare Information Systems subsidiary develop and market computer-based practice management and electronic patient records systems and e-business applications for dental and medical group practices.
This news release may contain forward-looking statements, including those related to revenue and net income, that involve a number of risks and uncertainties. Among the important factors that could impact actual results are volume and timing of systems sales and installations; length of sales cycles and installation process; the possibility that the products will not achieve market acceptance; seasonal patterns of sales and customer buying behavior; the development by competitors of new or superior technologies; delays in product development; undetected errors or bugs in software; product liability; changing economic, political or regulatory influences in the health-care industry; changes in product-pricing policies; competitive pressures; possible regulation of the company's software by the U.S. Food and Drug Administration; general economic conditions; and the risk factors detailed from time to time in Quality Systems� periodic reports and registration statements filed with the Securities and Exchange Commission.
[financial
highlights follow]
Quality Systems, Inc.
Consolidated Statements of Operations and Comprehensive Income
Three Months Ended Six Months Ended
September 30, September 30,
2002 2001 2002 2001
Net Revenues:
Sales of computer
systems, Upgrades
and supplies 6,814,000 5,110,000 13,239,000 10,704,000
Maintenance and
other services 6,180,000 5,387,000 12,062,000 10,702,000
12,994,000 10,497,000 25,301,000 21,406,000
Cost of Products
and Services 5,660,000 4,547,000 10,580,000 9,281,000
Gross Profit 7,334,000 5,950,000 14,721,000 12,125,000
Selling, General and
Administrative
Expenses 3,442,000 3,294,000 7,115,000 6,539,000
Research and
Development Costs 1,213,000 1,000,000 2,348,000 2,107,000
Income from
Operations 2,679,000 1,656,000 5,258,000 3,479,000
Investment Income 123,000 190,000 227,000 396,000
Income before
Provision for
Income Taxes 2,802,000 1,846,000 5,485,000 3,875,000
Provision for Income
Taxes 1,092,000 714,000 2,148,000 1,485,000
Net Income $1,710,000 $1,132,000 3,337,000 2,390,000
Income per
Share - Basic $ 0.28 $ 0.19 $ .55 $ .40
Income per
Share - Diluted $ 0.27 $ 0.18 .53 .39
Weighted average number
of shares
outstanding - Basic 6,122,000 5,997,000 6,114,000 5,997,000
Weighted average number
of shares
outstanding - Diluted 6,351,000 6,204,000 6,347,000 6,189,000
Quality Systems, Inc.
Consolidated Balance Sheets
(in thousands)
ASSETS
September 30, March 31,
2002 2002 (audited)
(unaudited)
Current Assets:
Cash and cash equivalents $29,796 $25,443
Short-term investments - 255
Accounts receivable, net 13,878 13,695
Inventories 891 1,118
Deferred tax assets 1,368 1,368
Other current assets 1,239 1,013
Total current assets 47,172 42,892
Equipment and Improvements, net 1,844 1,578
Capitalized Software Costs, net 2,179 2,103
Deferred Tax Asset 2,778 2,778
Excess of Cost Over Net Assets
of Acquired Business, net 1,840 1,840
Other Assets 796 952
Total assets $56,609 $52,143
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable $1,327 $2,657
Deferred service revenue 8,326 6,155
Other current liabilities 3,390 3,281
Total liabilities 13,043 12,093
Commitments and Contingencies
Shareholders' Equity:
Common stock, $0.01 par value,
20,000 shares authorized,
6,129 and 6,105 shares issued
and outstanding, respectively 61 61
Additional paid-in capital 34,853 34,674
Retained Earnings 8,652 5,315
Total shareholders' equity 43,566 40,050
Total liabilities and
Shareholders' equity $56,609 $52,143
Contact:
Quality Systems Inc., Irvine
Lou Silverman, 949/255-2600
www.qsii.com
or
Coffin Communications Group, Sherman Oaks, Calif.
William F. Coffin/Sean Collins, 818/789-0100
www.coffincg.com.
