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October
30, 2003
Quality Systems Reports Second Quarter Results
IRVINE, Calif.--(BUSINESS WIRE)--Oct. 30, 2003--Quality Systems, Inc. (Nasdaq:QSII - News) today announced the results of operations for its fiscal 2004 second quarter ended September 30, 2003.
The Company posted net revenues of $17.6 million in the second quarter, an increase of 35% from $13.0 million for the same quarter last year. The Company reported net income of $2,408,000, an increase of 41% over net income of $1,710,000 for the comparable quarter of the prior year. Fully diluted earnings per share totaled $0.37 in the quarter, an increase of 37% over the fully diluted $0.27 per share earnings recorded in the same quarter of last year.
The revenue and net income results achieved in the quarter were records for the company. Results in the second quarter were driven by record revenue and profit in the company's NextGen Healthcare Information Systems division, which posted record revenue of $13.5 million, up 57% over the same-quarter prior year, and record operating income of $3.8 million, up 81% over the same-quarter prior year.
Quality Systems, Inc. will hold a conference call to discuss second quarter financial results today, Thursday, October 30, 2003, at 1:00 p.m. EST (10:00 a.m. PST). To participate in the call, please call (877) 586-7724 five to ten minutes prior to the scheduled conference call time. 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 Thursday, October 30, at 1:00 p.m. PST, through Thursday, November 6, at midnight EST. To access the replay, dial (800) 642-1687 and enter the conference ID number 3512337.
A transcript of the conference call will be made available on the QSII Web site (www.qsii.com).
Quality Systems, Inc. and its NextGen Healthcare Information Systems subsidiary develop and market computer-based practice management, medical records, and connectivity applications for large medical and dental group practices. Visit www.qsii.com and www.nextgen.com for additional information
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 on the healthcare 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.
Quality Systems, Inc.
Consolidated Statements of Income
(unaudited)
Three Months Ended Six Months Ended
September 30, September 30,
2003 2002 2003 2002
----------- ----------- ----------- -----------
Net Revenues:
Sales of computer
systems, upgrades
and supplies 10,026,000 6,814,000 19,500,000 13,239,000
Maintenance and other
services 7,616,000 6,180,000 14,448,000 12,062,000
----------- ----------- ----------- -----------
17,642,000 12,994,000 33,948,000 25,301,000
Cost of Products and
Services 7,492,000 5,660,000 14,102,000 10,580,000
----------- ----------- ----------- -----------
Gross Profit 10,150,000 7,334,000 19,846,000 14,721,000
Selling, General and
Administrative
Expenses 4,768,000 3,442,000 9,508,000 7,115,000
Research and
Development Costs 1,502,000 1,213,000 2,868,000 2,348,000
----------- ----------- ----------- -----------
Income from Operations 3,880,000 2,679,000 7,470,000 5,258,000
Investment Income 89,000 123,000 189,000 227,000
----------- ----------- ----------- -----------
Income before
Provision for Income
Taxes 3,969,000 2,802,000 7,659,000 5,485,000
Provision for Income
Taxes 1,561,000 1,092,000 2,974,000 2,148,000
----------- ----------- ----------- -----------
Net Income $2,408,000 $1,710,000 $4,685,000 $3,337,000
=========== =========== =========== ===========
Income per Share -
Basic $0.39 $0.28 $0.76 $0.55
=========== =========== =========== ===========
Income per Share -
Diluted $0.37 $0.27 $0.72 $0.53
=========== =========== =========== ===========
Weighted average
number of shares
outstanding - Basic 6,167,000 6,122,000 6,162,000 6,114,000
=========== =========== =========== ===========
Weighted average
number of shares
outstanding - Diluted 6,491,000 6,351,000 6,479,000 6,347,000
=========== =========== =========== ===========
Quality Systems, Inc.
Consolidated Balance Sheets
(in thousands)
ASSETS
September 30, March 31,
2003 (unaudited) 2003
---------------- ---------------
Current Assets:
Cash and cash equivalents $40,573 $36,443
Accounts receivable, net 21,240 17,561
Inventories 984 667
Deferred tax assets 2,029 2,029
Other current assets 1,867 2,086
---------------- ---------------
Total current assets 66,693 58,786
Equipment and Improvements, net 1,797 1,777
Capitalized Software Costs, net 3,020 2,511
Deferred Tax Asset 1,819 1,819
Excess of Cost Over Net Assets of
Acquired Business, net 1,840 1,840
Other Assets 972 869
---------------- ---------------
Total assets $76,141 $67,602
================ ===============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable $1,742 $2,477
Deferred revenue 15,093 11,699
Other current liabilities 6,900 5,893
---------------- ---------------
Total liabilities 23,735 20,069
Commitments and Contingencies
Shareholders' Equity:
Common stock, $0.01 par value,
20,000 shares authorized, 6,174
and 6,152 shares issued and
outstanding, respectively 62 62
Additional paid-in capital 35,309 35,121
Retained Earnings 17,035 12,350
---------------- ---------------
Total shareholders' equity 52,406 47,533
Total liabilities and
Shareholders' equity $76,141 $67,602
================ ===============
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.
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