EX-99.1 2 w68074exv99w1.htm PRESS RELEASE DATED OCTOBER 28, 2004 exv99w1
 

Exhibit 99.1

OPINION RESEARCH CORPORATION

FOR IMMEDIATE RELEASE

Company Contact:
Douglas L. Cox
EVP & Chief Financial Officer
Opinion Research Corporation
(609) 452-5274

OPINION RESEARCH REPORTS A 41% INCREASE IN NET INCOME ON A 9%
INCREASE IN REVENUES FOR THE THIRD QUARTER

PRINCETON, N.J. – October 28, 2004 – Opinion Research Corporation (NASDAQ: ORCI), today announced financial results for the third quarter ended September 30, 2004. Summarizing the quarter’s results, Chairman and CEO John F. Short said, “We are pleased with our performance in the third quarter with revenues increasing 9% and net income increasing 41% over the third quarter of last year.”

Revenues

Revenues for the third quarter were $48.9 million versus $44.9 million in the prior year’s third quarter. Social research revenues were $32.7 million versus $29.1 million in last year’s third quarter. Commercial market research revenues totaled $13.0 million versus $12.0 million in the prior year’s third quarter. Teleservices revenues were $3.2 million versus $3.8 million in last year’s third quarter.

Income

Operating income for the third quarter was $3.1 million, versus $2.7 million in the prior year’s third quarter, an increase of 11%. Net income was $1.0 million in the quarter, as compared to $.7 million in the third quarter last year. Net income per diluted share was $0.15 versus net income per diluted share of $0.11 in the prior year’s third quarter.

Business Outlook

Mr. Short commented, “We believe that the outlook for our commercial market research business is improving, based on increasing backlog, the volume of new business inquiries we are

 


 

receiving and the proposals we are submitting to potential clients. We also expect our social research business to continue to meet our expectations.” The company has increased its revenue guidance for 2004 to a range of $194 million to $196 million and has narrowed the range of its earlier net income and earnings per share guidance for 2004 to $3.0 million to $3.2 million and $0.46 to $0.50 per diluted share. These include a second quarter 2004 refinancing-related charge which reduced net income by $1.6 million and diluted earnings per share by $0.26. This guidance does not include the impact of the previously announced potential common stock offering.

The statements above concerning the company’s business outlook for 2004 are based on current expectations. These statements are forward-looking and actual results may differ materially.

Nine-Month Results

For the first nine months of 2004, revenues were $146.3 million compared to $133.5 million in the first nine months of 2003, an increase of 10%. For the first nine months of 2004 net income was $1.7 million, or $0.26 per diluted share, compared to $2.4 million, or $0.38 per diluted share, last year. Net income and earnings per share for the first nine months of 2004 include the $1.6 million impact of the refinancing-related charge referred to above.

About Opinion Research Corporation

Founded in 1938, Opinion Research Corporation provides commercial market research, health and demographic research for government agencies, information services, teleservices and consulting. The company is a pioneering leader in the science of market and social research, and has built a worldwide data-collection network. Further information is available at www.opinionresearch.com.

This release contains, within the meaning of the safe harbor provision of the Private Securities Litigation Reform Act of 1995, forward-looking statements that are based on management’s beliefs and assumptions, current expectations, estimates and projections. Many of the factors that will determine the company’s financial results are beyond the ability of the company to control or predict. These statements are subject to risks and uncertainties and therefore actual results may materially differ. The company disclaims any obligation to update any forward-looking statements whether as a result of new information, future events, or otherwise. Important factors and risks that may affect future results are described in the company’s filings with the Securities and Exchange Commission, copies of which are available upon request from the company.

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OPINION RESEARCH CORPORATION AND SUBSIDIARIES
Consolidated Statements of Income
(in thousands, except share and per share amounts)


                                   
    For The Three Months   For The Nine Months
    Ended September 30,
  Ended September 30,
    2004
  2003
  2004
  2003
Revenues
  $ 48,894     $ 44,867     $ 146,255     $ 133,512  
Cost of revenues (exclusive of depreciation)
    34,692       31,561       103,455       93,313  
 
   
 
     
 
     
 
     
 
         
Gross profit
    14,202       13,306       42,800       40,199  
Selling, general and administrative expenses
    10,130       9,542       30,398       29,192  
Depreciation and amortization
    1,017       1,018       2,914       2,972  
 
   
 
     
 
     
 
     
 
 
Operating income
    3,055       2,746       9,488       8,035  
Interest expense
    1,167       1,247       6,540       3,541  
Other non-operating (income) expenses, net
    (85 )     (5 )     (386 )     12  
 
   
 
     
 
     
 
     
 
 
Income before provision for income taxes
    1,973       1,504       3,334       4,482  
Provision for income taxes
    972       793       1,632       2,118  
 
   
 
     
 
     
 
     
 
 
Net income
  $ 1,001     $ 711     $ 1,702     $ 2,364  
 
   
 
     
 
     
 
     
 
 
Net income per common share:
                               
Basic
  $ 0.16     $ 0.12     $ 0.27     $ 0.39  
 
   
 
     
 
     
 
     
 
 
Diluted
  $ 0.15     $ 0.11       0.26       0.38  
 
   
 
     
 
     
 
     
 
 
Weighted average shares outstanding:
                               
Basic
    6,288,649       6,090,238       6,226,654       6,068,134  
Diluted
    6,483,720       6,323,573       6,435,092       6,178,744  

 


 

OPINION RESEARCH CORPORATION AND SUBSIDIARIES
Consolidated Balance Sheets
(in thousands)

                 
    30-Sep-04
  31-Dec-03
Assets
               
Current assets:
               
Cash and equivalents
  $ 15     $ 2,766  
Accounts receivable
    23,410       24,890  
Allowance for doubtful accounts
    (268 )     (336 )
Unbilled services
    18,580       14,140  
Prepaid expenses and other current assets
    3,990       3,161  
 
   
 
     
 
 
Total current assets
    45,727       44,621  
Non-current assets:
               
Fixed assets, net of depreciation
    9,767       9,099  
Goodwill
    32,579       32,537  
Other intangibles, net of amortization
    459       715  
Other non-current assets
    7,454       8,739  
 
   
 
     
 
 
Total non-current assets
    50,259       51,090  
 
   
 
     
 
 
Total assets
  $ 95,986     $ 95,711  
 
   
 
     
 
 
Liabilities and stockholders’ equity
               
Current liabilities:
               
Accounts payable
  $ 5,394     $ 5,473  
Accrued expenses
    11,718       13,829  
Deferred revenues
    3,388       2,183  
Short-term borrowings
    2,000       3,000  
Other current liabilities
    2,152       762  
 
   
 
     
 
 
Total current liabilities
    24,652       25,247  
Long-term borrowings
    40,396       41,922  
Other liabilities
    1,427       1,543  
Redeemable equity
    8,900       8,900  
Total stockholders’ equity
    20,611       18,099  
 
   
 
     
 
 
Total liabilities and stockholders’ equity
  $ 95,986     $ 95,711  
 
   
 
     
 
 

 


 

OPINION RESEARCH CORPORATION AND SUBSIDIARIES
Segment Information
(in thousands)

                                                         
    US Market   UK Market           Social   Total        
    Research
  Research
  Teleservices
  Research
  Segments
  Other
  Consolidated
Three months ended September 30, 2004:
                                                       
 
                                                       
Revenues from external customers
  $ 6,023     $ 5,623     $ 3,213     $ 32,703     $ 47,562     $ 1,332     $ 48,894  
Operating income (loss)
    (640 )     58       236       3,378       3,032       23       3,055  
Interest and other non-operating expenses, net
                                                    1,082  
Income before provision for income taxes
                                                  $ 1,973  
 
                                                       
Three months ended September 30, 2003:
                                                       
 
                                                       
Revenues from external customers
  $ 5,722     $ 5,433     $ 3,757     $ 29,144     $ 44,056     $ 811     $ 44,867  
Operating income (loss)
    (1,319 )     245       481       3,439       2,846       (100 )     2,746  
Interest and other non-operating expenses, net
                                                    1,242  
Income before provision for income taxes
                                                  $ 1,504  
 
                                                       
Nine months ended September 30, 2004:
                                                       
 
                                                       
Revenues from external customers
  $ 19,623     $ 16,681     $ 10,163     $ 95,897     $ 142,364     $ 3,891     $ 146,255  
Operating income (loss)
    (1,920 )     348       926       10,104       9,458       30       9,488  
Interest and other non-operating expenses, net
                                                    6,154  
Income before provision for income taxes
                                                  $ 3,334  
 
                                                       
Nine months ended September 30, 2003:
                                                       
 
                                                       
Revenues from external customers
  $ 19,397     $ 14,530     $ 10,441     $ 87,139     $ 131,507     $ 2,005     $ 133,512  
Operating income (loss)
    (2,529 )     621       1,070       9,296       8,458       (423 )     8,035  
Interest and other non-operating expenses, net
                                                    3,553  
Income before provision for income taxes
                                                  $ 4,482