EX-99.1 3 doc2.txt PRESS RELEASE Q4 2003 CCC INFORMATION SERVICES GROUP INC. REPORTS EPS OF $0.30 FOR THE FOURTH QUARTER AND $0.94 FOR THE FULL YEAR 2003 CHICAGO, FEBRUARY 4, 2004 - CCC Information Services Group Inc. (Nasdaq: CCCG) today reported income from continuing operations of $8.2 million, or $0.30 per share, for the fourth quarter ending December 31, 2003, compared to income from continuing operations of $4.8 million, or $0.17 per share, for 2002. Included in the fourth quarter 2003 results is a $1.4 million, or $0.05 per share, tax related benefit associated with the completion of a tax audit. Included in the fourth quarter 2002 results is a $2.6 million, or $0.06 per share, charge related to the purchase of the company's trust preferred securities. Revenue for the fourth quarter increased 1.1% to $48.9 million, compared to $48.4 for the same quarter in 2002. Operating income was $11.1 million for the fourth quarter, compared to operating income of $10.6 million for the same quarter in 2002. The operating margin was 22.6 percent, compared to 21.9 percent for the same quarter in 2002. "We finished 2003 in good shape," Githesh Ramamurthy, Chairman and Chief Executive Officer said, "As we look forward to 2004, we will focus on broadening our relationships with customers by bringing more solutions to market to help our customers drive their business." Income from continuing operations for the full year was $26.0 million, or $0.94 per share, compared to income from continuing operations of $22.4 million, or $0.83 per share, for 2002. Included in the 2003 results is the $1.4 million, or $0.05 per share, tax benefit mentioned above and a second-quarter charge of $1.1 million, or $0.02 per share, to recognize a final adjustment related to excess office space. Included in the 2002 results was a $2.6 million, or $0.06 per share, charge related to the company's purchase of its trust-preferred securities; a $0.9 million, or $0.02 per share, real estate charge; and a $2.0 million, or $0.08 per share, benefit related to tax credits. Revenue for the full year was $193.4 million, compared to $191.9 million in 2002, an increase of 0.8 percent. Operating income was $40.5 million in 2003 compared with $37.3 million for the previous year, up 8.5 percent. These numbers include real estate charges of $1.1 million and $0.9 million respectively. Operating margin ended the year at 20.9 percent, compared to 19.4 percent in 2002.
The product portfolio revenue by quarter and for the full year are as follows: PRODUCT PORTFOLIOS QUARTERLY REVENUE ($000s) 2003 ---------------------------------------------- Q1 Q2 Q3 Q4 Full Year ------- ------- ------- ------- ---------- TOTAL COLLISION ESTIMATING 29,021 29,493 29,504 30,172 118,190 Year/Year Comparison 1.8% 1.0% 0.3% 3.7% 1.7% TOTAL VALUATION SERVICES 10,696 10,239 10,720 10,532 42,187 Year/Year Comparison (6.5%) (10.2%) (4.8%) (7.3%) (7.2%) TOTAL WORKFLOW 6,362 6,638 6,645 6,462 26,107 Year/Year Comparison 18.0% 18.2% 24.6% 3.2% 15.5% TOTAL INFORMATION PRODUCTS 307 488 445 468 1,708 Year/Year Comparison 3.1% 79.0% 54.4% 69.6% 50.6% TOTAL OTHER 1,346 1,239 1,307 1,268 5,160 Year/Year Comparison (27.2%) (27.2%) (12.6%) (8.3%) (19.8%) TOTAL REVENUES 47,732 48,097 48,621 48,902 193,352 Year/Year Comparison 0.5% (0.2%) 1.7% 1.1% 0.8%
Revenue, operating expenses and income by quarter and for the full year are as follows: REVENUE, OPERATING EXPENSES & INCOME ($000s) 2003 ---------------------------------------------- Q1 Q2 Q3 Q4 Full Year ------- ------- ------- ------- ---------- REVENUE 47,732 48,097 48,621 48,902 193,352 EXPENSES PRODUCTION AND CUSTOMER SUPPORT 7,344 7,754 8,279 8,489 31,866 Year/Year Comparison 2.8% 2.5% 23.5% 21.9% 12.3% COMMISSIONS, ROYALTIES AND LICENSES 2,417 3,013 3,184 3,099 11,713 Year/Year Comparison (1.9%) 19.2% 15.1% 16.8% 12.5% SELLING, GENERAL AND ADMINISTRATIVE 18,566 17,150 16,699 15,674 68,089 Year/Year Comparison (3.2%) (12.3%) (15.0%) (17.8%) (12.1%) DEPRECIATION AND AMORTIZATION 1,930 2,014 1,944 2,035 7,923 Year/Year Comparison (20.2%) (17.3%) (15.3%) 5.9% (12.6%) PRODUCT DEVELOPMENT AND PROGRAMMING 7,696 8,156 7,838 8,544 32,234 Year/Year Comparison 8.6% 18.3% 8.2% 19.3% 13.6% RESTRUCTURING CHARGES - 1,061 - - 1,061 ------- ------- ------- ------- ---------- TOTAL OPERATING EXPENSES 37,953 39,148 37,944 37,841 152,886 ------- ------- ------- ------- ---------- Compared to 2002 (0.9%) 0.4% (4.0%) 0.2% (1.1%) OPERATING INCOME 9,779 8,949 10,677 11,061 40,466 Year/Year Comparison 6.2% (2.7%) 28.8% 4.3% 8.5% OPERATING MARGIN 20.5% 18.6% 22.0% 22.6% 20.9%
Operating expenses for the full year were $152.9 million, down $1.7 million or 1.1 percent from last year. For the quarter, operating expenses were up $0.1 million or 0.2 percent from a year ago to $37.8 million. Production and customer support increased $1.5 million or 21.9 percent for the quarter, and $3.5 million or 12.3 percent for the year, primarily related to increased costs associated with the Comp-Est business and an investment in the technical support area. Commissions, royalties and licenses were up about $1.3 million for the year due to license fees related to Comp-Est revenues. Selling, general & administrative decreased $3.4 million, or 17.8 percent, for the fourth quarter and $9.4 million, or 12.1 percent, for the year driven by a continued focus on controlling expenses, specifically in the MIS area, and certain compensation costs tied to business performance. Finally, product development and programming expenses were up $1.4 million for the quarter, or 19.3 percent, and up $3.9 million, or 13.6%, for the year. New development projects related to Workflow and Information Services solutions were the primary drivers of the increase. The company issued the following guidance for the first quarter and full year 2004: - Revenue growth for the first quarter is expected to be in the 3 to 5 percent range with growth rates for the full year at least that of the first quarter 2004. - Operating income for the first quarter should be in the $10 million range, and full year operating income is expected to be in the $45 to $47 million range. First quarter operating margins are expected to be lower than reported in the second half of 2003, primarily as a result of increased compensation costs tied to business performance, increased insurance expenses, and the timing of certain planned sales expenses. Margins are expected to increase throughout the year to a full year range of 22 to 23 percent. - Earnings per share for the full year is expected to be in the $1.00 to $1.04 per share range. Earnings per share for the first quarter is expected to be in $0.21 to $0.22 per share range. (Using a fully diluted share base of 27.7 million shares) ABOUT CCC CCC Information Services Group Inc. (NASDAQ: CCCG), headquartered in Chicago, is a leading supplier of advanced software, communications systems, Internet and wireless-enabled technology solutions to the automotive claims and collision repair industries. Its technology-based products and services optimize efficiency throughout the entire claims management supply chain and facilitate communication among approximately 21,000 collision repair facilities, 350 insurance companies, and a range of industry participants. For more information about CCC Information Services, visit CCC's Web site at www.cccis.com. This release contains statements that constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and are subject to the safe harbor provisions of those sections and the Private Securities Litigation Reform Act of 1995. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, including those described in the Company's filings with the SEC, and that actual results or developments may differ materially from those in the forward-looking statements. Specific factors that might cause actual results to differ from expectations include, but are not limited to, competition in the automotive claims and collision repair industries, the ability to develop new products and services, the ability to protect trade secrets and proprietary information, the ability to generate the cash flow necessary to meet the Company's obligations, the outcome of certain legal proceedings, and other factors. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management's analysis, judgment, belief or expectation only as of the date hereof. The Company has based these forward-looking statements on information currently available and disclaims any intention or obligation to update or revise any forward-looking statement. CCC INFORMATION SERVICES GROUP INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) (UNAUDITED)
THREE MONTHS ENDED YEAR ENDED DECEMBER 31, DECEMBER 31, ----------------------------------------- 2003 2002 2003 2002 ----------------------------------------- Revenue $ 48,902 $ 48,385 $ 193,352 $ 191,860 Expenses: Production and customer support 8,489 6,964 31,866 28,376 Commissions, royalties and licenses 3,099 2,653 11,713 10,411 Selling, general and administrative 15,674 19,079 68,089 77,449 Depreciation and amortization 2,035 1,922 7,923 9,069 Product development and programming 8,544 7,161 32,234 28,383 Restructuring charges - - 1,061 869 ----------------------------------------- Total operating expenses 37,841 37,779 152,886 154,557 Operating income 11,061 10,606 40,466 37,303 Interest income (expense) 164 (152) (392) (708) Other income 71 169 272 455 CCC Capital Trust minority interest expense - (2,600) - (3,984) Equity in income (loss) of ChoiceParts investment 123 4 (21) (291) ----------------------------------------- Income from continuing operations before income taxes 11,419 8,027 40,325 32,775 Income tax provision (3,195) (3,205) (14,285) (10,420) ----------------------------------------- Income from continuing operations 8,224 4,822 26,040 22,355 Income from discontinued operations, net of tax - - - 354 ----------------------------------------- Net income $ 8,224 $ 4,822 $ 26,040 $ 22,709 ========================================= Per Share Data: ----------------- Income per common share - basic from: Continuing operations $ 0.31 $ 0.19 $ 0.99 $ 0.86 Discontinued operations - - - 0.01 ----------------------------------------- Income per common share - basic $ 0.31 $ 0.19 $ 0.99 $ 0.87 ========================================= Income per common share - diluted from: Continuing operations $ 0.30 $ 0.17 $ 0.94 $ 0.83 Discontinued operations - - - 0.01 ----------------------------------------- Income per common share - basic $ 0.30 $ 0.17 $ 0.94 $ 0.84 ========================================= Weighted average common shares outstanding Basic 26,338 26,000 26,243 25,850 Diluted 27,752 27,574 27,655 26,904
CONSOLIDATED BALANCE SHEETS (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) (UNAUDITED)
DECEMBER 31, ------------------- 2003 2002 ------------------- ASSETS Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . $ 20,755 $ 20,200 Short-term investments. . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,004 - Accounts receivable, net. . . . . . . . . . . . . . . . . . . . . . . . . . . 10,247 10,281 Other current assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,369 8,499 ------------------- Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46,375 38,980 Property and equipment, net . . . . . . . . . . . . . . . . . . . . . . . . . 12,776 12,407 Intangible assets, net. . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,153 - Goodwill. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,747 4,896 Deferred income taxes, net. . . . . . . . . . . . . . . . . . . . . . . . . . 9,127 10,454 Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 265 479 Other assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 292 627 ------------------- Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 86,735 $ 67,843 =================== LIABILITIES AND STOCKHOLDERS' EQUITY Accounts payable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 5,937 $ 8,424 Accrued expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16,522 25,441 Income taxes payable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,602 2,568 Current portion of deferred revenues. . . . . . . . . . . . . . . . . . . . . 7,930 6,503 Other current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . 97 488 ------------------- Total current liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . 32,088 43,424 Deferred revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 13 Other liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,064 3,222 ------------------- Total liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35,152 46,659 ------------------- Common stock ($0.10 par value, 40,000,000 shares authorized, 26,376,839 and 26,074,889 shares outstanding at December 31, 2003 and 2002, respectively). 3,034 3,005 Additional paid-in capital. . . . . . . . . . . . . . . . . . . . . . . . . . 131,590 128,766 Accumulated deficit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (36,838) (62,878) Notes receivable from officer . . . . . . . . . . . . . . . . . . . . . . . . - (1,506) Treasury stock, at cost (4,094,665 common shares in treasury at December 31, 2003 and December 31, 2002) . . . . . . . . . . . . . . . . . . . . . . . (46,203) (46,203) ------------------- Total stockholders' equity . . . . . . . . . . . . . . . . . . . . . . . . . 51,583 21,184 ------------------- Total liabilities and stockholders' equity . . . . . . . . . . . . . . . . . $ 86,735 $ 67,843 ===================
CONSOLIDATED STATEMENTS OF CASH FLOWS (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) (UNAUDITED)
YEAR ENDED DECEMBER 31, ------------------- 2003 2002 ------------------- Operating Activities: Net income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 26,040 $ 22,709 Adjustments to reconcile net income to net cash provided by operating activities: Income from discontinued operations, net of income taxes. . . . . . . . . . . . . . . . . - (354) Equity in net losses of ChoiceParts . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 291 Depreciation and amortization of property and equipment . . . . . . . . . . . . . . . . . 7,210 9,069 Amortization of intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . 713 - Deferred income tax provision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,327 13,456 Restructuring charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,061 869 Compensation expense related to restricted stock. . . . . . . . . . . . . . . . . . . . . 16 - Interest on notes receivable from officer . . . . . . . . . . . . . . . . . . . . . . . . - (106) Other, net. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78 191 Changes in: Accounts receivable, net. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 928 1,065 Other current assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 135 (1,649) Other assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 335 400 Accounts payable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,542) (437) Accrued expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (8,891) (2,021) Income taxes payable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (433) 3,459 Deferred revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 178 153 Other liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,164) (1,543) ------------------- Net cash provided by operating activities: Continuing operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,012 45,552 Discontinued operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 30 ------------------- Net cash provided by operating activities . . . . . . . . . . . . . . . . . . . . . . . . 25,012 45,582 ------------------- Investing Activities: Capital expenditures. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (7,491) (8,609) Acquisition of Comp-Est Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (13,205) (193) Purchase of short-term investments. . . . . . . . . . . . . . . . . . . . . . . . . . . . (7,004) - Investment in affiliates. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - (275) Issuance of warrants to Hearst. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 318 ------------------- Net cash used for investing activities. . . . . . . . . . . . . . . . . . . . . . . . . . (27,700) (8,759) ------------------- Financing Activities: Proceeds from exercise of stock options . . . . . . . . . . . . . . . . . . . . . . . . . 1,825 3,112 Payment of principal and interest on notes receivable from officer. . . . . . . . . . . . 1,506 - Proceeds from employee stock purchase plan. . . . . . . . . . . . . . . . . . . . . . . . 399 377 Proceeds from borrowings on long-term debt. . . . . . . . . . . . . . . . . . . . . . . . - 22,000 Principal repayments on long-term debt. . . . . . . . . . . . . . . . . . . . . . . . . . - (28,500) Purchase of Trust Preferred Securities. . . . . . . . . . . . . . . . . . . . . . . . . . - (13,369) Principal repayments of capital lease obligations . . . . . . . . . . . . . . . . . . . . (487) (421) Principal repayments on short term note . . . . . . . . . . . . . . . . . . . . . . . . . - (588) ------------------- Net cash provided by (used for) financing activities. . . . . . . . . . . . . . . . . . . 3,243 (17,389) ------------------- Net increase in cash and cash equivalents. . . . . . . . . . . . . . . . . . . . . . . . . 555 19,434 Cash and cash equivalents: Beginning of year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,200 766 ------------------- End of year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 20,755 $ 20,200 ===================