Internet Commerce Corporation (ICC) (Nasdaq: ICCA), a leader in
business-to-business e-commerce solutions, today announced
financial results for its fiscal third quarter 2007. "Overall, this
quarter was productive for ICC in regards to our �Growth with
Profitability� strategy,� said Thomas Stallings, chief executive
officer of ICC. �With our continued focus on revenue growth,
streamlined operations and shareholder value, we met our internal
financial forecasts with a 19% increase in revenue and a 32%
increase in operating income, implemented organizational changes to
save approximately $1.3 million annually beginning in the fourth
quarter fiscal 2007 and announced a definitive agreement to acquire
EasyLink Services Corporation.� Mr. Stallings continued, �We made
great progress toward achieving our long-term marketplace and
financial goals, and I am confident that our core strength in
operational excellence will result in a solid performance for
fiscal year 2007.� Third Quarter Fiscal Year 2007 Results Third
quarter revenue from continuing operations in fiscal 2007 was
approximately $5.4 million, up 19% compared with our third quarter
of fiscal 2006 revenues of approximately $4.5 million. In the EC
Solutions segment, comprised of the ICC.NETTM Value Added Network,
browser-based and hosted applications and desktop software, third
quarter revenues from continuing operations were approximately $4.1
million, up 28% from approximately $3.2 million in the fiscal third
quarter 2006 period. Revenues from the EC Services segment,
comprised of the EC service center, managed services and
professional services, were approximately $1.29 million, down 3%
from approximately $1.33 million in the third quarter of fiscal
2006. Total expenses from continuing operations increased 17% in
third quarter fiscal 2007 from the prior-year period to $4.8
million from $4.1 million. The increase in expenses during the
quarter was primarily driven by the acquisition of Enable Corp and
restructuring charges to eliminate redundancy from acquisitions and
streamlined operations. Operating income increased 32% to
approximately $635,000 in third quarter fiscal 2007 from
approximately $482,000 for the same period in fiscal 2006. With a
$124,000 increase in provision for income taxes, consisting
primarily of state income taxes not covered by our existing state
net loss carryforwards and a true up of past years� state income
tax timing differences as a result of changing the tax year-end
from December 31 to July 31, net income was approximately $551,000
compared to a net income of approximately $550,000 for third
quarter fiscal 2006. Basic and diluted income per common share from
continuing operations were $0.02 as compared with $0.02 per basic
and diluted common share for the fiscal 2006 period. Nine Month
Fiscal 2007 Results For the nine months ended April 30, 2007,
revenues from continuing operations totaled approximately $16.5
million, up 13% compared with the first nine months fiscal 2006
revenues of approximately $14.6 million. Net income was
approximately $1.8 million compared to a net income of
approximately $1.6 million for the same period in fiscal 2006, an
increase of 11%. Basic and diluted income per common share from
continuing operations were $0.08 and $0.07, respectively, as
compared to $0.07 per basic and diluted common share for the nine
month period of fiscal 2006 period. The Company ended the first
nine months of fiscal 2007 with approximately $7.0 million of cash
on hand. The balance sheet remains strong with current assets
ending at approximately $11.8 million and current liabilities at
approximately $2.0 million. Forward-Looking and Cautionary
Statements Except for the historical information and discussion
contained herein, statements contained in this release may
constitute forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. These statements
involve a number of risks, uncertainties and other factors that
could cause actual results to differ materially, as discussed in
the company�s filing with the U.S. Securities and Exchange
Commission (SEC). About Internet Commerce Corporation (ICC)
Internet Commerce Corporation (Nasdaq: ICCA), headquartered in
Norcross, Georgia, is a leader in providing business-to-business
e-commerce solutions. Thousands of customers rely on ICC's
comprehensive line of solutions, in-depth expertise, and unmatched
customer service to help balance cost, fit, and function required
to meet unique requirements for trading partner compliance,
coordination, and collaboration. With its software solutions,
network services, hosted web applications, managed services, and
consulting services, ICC is the trusted provider of e-commerce
solutions for businesses, regardless of size and level of technical
sophistication, to connect them with their trading communities. For
more information, visit www.icc.net. INTERNET COMMERCE CORPORATION
Consolidated Statements of Operations (unaudited) (in thousands,
except for share and per share amounts) � Three Months Ended Nine
Months Ended April 30, April 30, 2007� 2006� 2007� 2006� � Service
revenues $ 5,390� $ 4,535� $ 16,500� $ 14,565� � Expenses: Cost of
services 1,999� 1,579� 5,828� 5,234� Product development and
enhancement 595� 192� 1,898� 502� Selling and marketing 380� 567�
1,269� 1,560� General and administrative 1,781� 1,715� 5,610�
5,650� 4,755� 4,053� 14,605� 12,946� Operating income 635� 482�
1,895� 1,619� � Other income (expense): Interest and investment
income 70� 75� 233� 134� Interest expense (19) (23) (59) (136)
Other income (expense) --� 27� (21) 55� 51� 79� 153� 53� Income
before provision for income taxes 686� 561� 2,048� 1,672� �
Provision (benefit) for income taxes, current 135� 11� 219� 28� �
Net income 551� 550� 1,829� 1,644� � Dividends on preferred stock
(49) (97) (233) (299) Extinguishment of dividends on retired
preferred stock --� --� � 200� --� � Net income attributable to
common stockholders $ 502� $ 453� $ 1,796� $ 1,345� � Basic income
per common share $ 0.02� $ 0.02� $ 0.08� $ 0.07� Diluted income per
common share $ 0.02� $ 0.02� $ 0.07� $ 0.07� Anti-dilutive stock
options and warrants outstanding 2,371,473� 1,075,057� 1,482,592�
1,600,841� Weighted average number of common shares outstanding �
basic 22,823,776� 20,370,591� 22,759,581� 19,982,232� Weighted
average number of common shares outstanding � diluted 24,234,565�
22,943,061� 24,674,040� 21,900,688� INTERNET COMMERCE CORPORATION
Consolidated Balance Sheets (in thousands) � April 30, July 31,
2007� 2006� (unaudited) ASSETS Current assets: Cash and cash
equivalents $ 7,047� $ 6,989� Accounts receivable, net of allowance
for doubtful accounts and allowance for sales returns and
allowances of $448 and $458, respectively 4,106� 3,631� Prepaid
expenses and other current assets 684� 462� Total current assets
11,837� 11,082� � Restricted cash 433� 433� Property and equipment,
net 1,058� 1,113� Goodwill 6,169� 6,148� Other intangible assets,
net 4,001� 4,830� Other assets 41� 38� Total assets $ 23,539� $
23,644� � LIABILITIES AND STOCKHOLDERS� EQUITY Current liabilities:
Accounts payable $ 398� $ 662� Accrued expenses 889� 575� Accrued
dividends � preferred stock 66� 232� Deferred revenue 237� 262�
Lease liability from acquisition 266� 250� Other current
liabilities 135� 116� Total current liabilities 1,991� 2,097� � �
Long-term lease liability from acquisition 776� 967� Total
liabilities 2,767� 3,064� � � Stockholders� Equity: Preferred stock
(a) (a) Common stock 230� 227� Additional paid-in capital 101,403�
103,043� Accumulated deficit (80,861) (82,690) Total stockholders�
equity 20,772� 20,580� � Total liabilities and stockholders� equity
$ 23,539� $ 23,644� (a) less than 1,000
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