Ciber, Inc.
6363 S. Fiddler's Green Circle, Suite
1400
Greenwood Village, CO 80111
www.ciber.com
CIBER REPORTS
FOURTH QUARTER AND FULL YEAR 2014 RESULTS
GREENWOOD VILLAGE, Colo., February 3, 2015- Ciber, Inc. (NYSE: CBR), a
leading global information technology consulting, services and
outsourcing company, today reported results for the fourth quarter
and full year 2014.
Highlights From Continuing
Operations for the Fourth Quarter 2014 Include:
-
Revenue of $219.6 million, a 1% decrease in U.S.
dollars, up 3% in constant currency versus the prior year
-
Gross margin of 25.8%, down from 26.0% in both
the prior year and third quarter
-
Operating income of $7.6 million, before
amortization and restructuring charges of $3.6 million
-
Net income from continuing operations of $3.1
million, or net income from continuing operations of $5.6 million
before amortization and restructuring charges, or $0.07 per
share
-
Operating cash flow from continuing operations
of $30.0 million
Highlights From Continuing
Operations for the Full Year 2014 Include:
-
Revenue of $863.6 million, a 2% decrease versus
the prior year in both U.S. dollars and constant currency
-
Gross margin of 25.8%, up from 25.4% in the
prior year
-
Operating income of $21.6 million, before
amortization, restructuring charges of $26.2 million, and
management transition costs
-
Net loss from continuing operations of $18.8
million, or net income from continuing operations of $9.1 million
before amortization, restructuring charges and management
transition costs, or $0.12 per share
-
Operating cash flow from continuing operations
of $2.0 million
President and Chief Executive Officer Michael
Boustridge said, "Fourth quarter results mark an important
milestone for Ciber, as we delivered the highest level of
profitability at the company in four years and grew revenue in
constant currency. North America remains solid, International shows
signs of slight improvement and restructuring efforts are
progressing."
Christian Mezger, Chief Financial Officer,
commented, "We are implementing our restructuring plan as expected,
and are committed to allocating capital to build long term,
sustainable shareholder value, as we balance investments while
returning capital to our shareholders."
Market Highlights in the Fourth
Quarter Include:
-
A large non-profit hospital system in the
U.S., which has been a client of Ciber's for the past 2 years, has
signed a contract to provide legacy managed services to the
company, extending our relationship with the provision of new
services. The contract will run for 3 years and see Ciber support
their legacy applications portfolio as the institution adapts to
the ever changing healthcare environment.
-
Following completion and acceptance of Ciber's
Business Blueprint, Printus Fachbetrieb für Bürobedarf GmbH has
signed an implementation contract for an SAP ERP system covering
financials and purchasing to be delivered in 2015.
-
Ciber in Denmark has renewed a substantial
agreement with its partner working for the Danish Tax
Authority.
Fourth-Quarter Financial Results
from Continuing Operations
Revenue of $219.6 million decreased 1% in U.S.
dollars, or increased 3% in constant currency, compared with last
year's fourth quarter. Sequentially from the third quarter of
2014, revenue was up 4% in U.S. dollars or 8% in constant
currency.
Gross margin for the fourth quarter was 25.8%,
compared with 26.0% in last year's fourth quarter and the third
quarter of 2014.
Selling, general and administrative expenses
(SG&A) in the fourth quarter were $49.0 million, a decrease of
5% from the fourth quarter of last year, and a 6% decrease
sequentially.
Fourth quarter 2014 operating income from
continuing operations of $7.6 million, before amortization and
restructuring charges of $3.6 million, yielded an operating margin
of 3.5%, compared to 2.8% in the prior-year fourth quarter, and
1.4% in the third quarter of 2014. Including amortization and
restructuring charges, operating income from continuing operations
was $4.0 million.
Net income from continuing operations, before
amortization and restructuring charges, for the fourth quarter of
2014 was $5.6 million, or $0.07 per share. Including amortization
and restructuring charges, net income from continuing operations
was $3.1 million in the quarter. Last year's fourth quarter
net income from continuing operations, before amortization and
restructuring charges, was $3.0 million, or $0.04 on a per share
basis. For the third quarter of 2014, net loss from
continuing operations, before restructuring charges, was $1.9
million, or $(0.02) per share.
Revenue in the International division was $112.1
million for the fourth quarter of 2014, which was down 6% in U.S.
dollars compared to the year-ago fourth quarter, and up 2% in
constant currency. Compared to the third quarter of 2014,
International revenue was up 7% in U.S. dollars and up 14% in
constant currency. Operating margin of 6.7% was up 10 basis
points compared to the fourth quarter of 2013 and up 500 basis
points from the third quarter of 2014.
The North American division posted revenue of
$107.7 million, up 3% from the year-ago fourth quarter and up 1%
compared to the third quarter of 2014. Operating margin of
10.2% improved 220 basis points from the year-ago fourth quarter
and was up 40 basis points from the third quarter of
2014.
Full Year Financial Results from
Continuing Operations
Revenue of $863.6 million decreased 2% in both
U.S. dollars and constant currency, compared to 2013.
Gross margin for the full year increased to 25.8%,
compared with 25.4% in 2013.
Before management transition costs, selling,
general and administrative expenses (SG&A) for the full year
decreased $1.9 million to $201.1 million, a 1.0% decrease from
2013. Including management transition costs, SG&A for the
full year was $206.0 million.
2014 operating income from continuing operations
of $21.6 million, before amortization, restructuring charges of
$26.2 million, and management transition costs, yielded an
operating margin of 2.5%, compared to 2.3% in 2013. Including
amortization, restructuring charges and management transition
costs, operating loss from continuing operations was $9.8 million
in 2014.
Net income from continuing operations in 2014,
before amortization, restructuring charges and management
transition costs, was $9.1 million, or $0.12 per share. Including
amortization, restructuring charges and management transition
costs, net loss from continuing operations was $18.8 million for
the year. 2013 net income from continuing operations before
amortization, restructuring charges and management transition costs
was $9.5 million, or $0.13 per share.
Revenue in the International division was $441.9
million in 2014, which was down 3% in both U.S. dollars and
constant currency, compared to 2013. Operating margin of 4.4%
was down 70 basis points compared 2013.
The North American division posted revenue of
$422.7 million, which was flat compared to 2013. Operating
margin of 9.2% improved 130 basis points from 2013.
Capital Deployment and
Liquidity
Ciber's cash balance at the end of the fourth
quarter of 2014 was $45.9 million. The outstanding balance on
the credit facility was $11.4 million. Net cash at the end of
the quarter was $34.5 million.
Cash flow from operating activities (continuing
operations) year-to-date through December 31, 2014 was $2.0
million, a decrease of $23.3 million versus the prior year.
Days Sales Outstanding (DSO) were 57 days, a decrease of 2 days
versus the prior year. Capital expenditures totaled $8.2 million
for the full year 2014.
Restructuring
On July 25, 2014, we approved a restructuring plan
focused on the implementation of a go-to-market model, realigning
the organization and improving our near and offshore delivery mix
("the 2014 Plan"). The 2014 Plan commenced in the third
quarter of 2014 and is expected to be completed in the third
quarter of 2015. It is expected to impact approximately 280
people. We estimate the total amount of the restructuring
charges for the 2014 Plan will be approximately $27 million,
substantially all of which will be settled in cash. The total
estimated restructuring expenses include approximately $20 million
related to employee severance and related benefits and
approximately $7 million related to office closures and other
expenses.
Continuing Operations
For a recap of historical comparisons, please
refer to Ciber's SEC filings on forms 10-Q and 8-K. These
filings may be found in the Investor Relations section of the
Company's website at www.ciber.com/cbr.
Investor and Analyst Conference
Call
Ciber President and Chief Executive Officer Michael Boustridge
invites you to participate in a conference call or audiocast today
at 8:30 a.m. Eastern Time to discuss the Company's financial
results.
The live audiocast of the conference call will be
available to the public at www.ciber.com/cbr. To participate
in the conference call, dial 866-515-2913 (U.S.) or +1-617-399-5127
(outside the U.S.) ten minutes prior to the start of the call and
provide the operator with the pass code 97239733.
A replay of the call and webcast will be available
one hour after the call ends through March 3, 2015. To access
the telephone replay, dial 888-286-8010 (U.S.) or +1-617-801-6888
(outside the U.S.) and use the pass code 45471972. The
webcast replay will be available at www.ciber.com/cbr.
Non-GAAP Financial
Information
Ciber presents a number of non-GAAP measurements because management
believes that these metrics provide meaningful supplemental
information in addition to the GAAP metrics and provide
comparability and consistency to prior periods. These non-GAAP
measurements include: fourth quarter 2014 revenue change
year-over-year adjusted for currency; fourth quarter 2014
year-to-date revenue change year-over-year adjusted for currency;
fourth quarter 2014 sequential revenue change adjusted for
currency; international fourth quarter 2014 revenue change
year-over-year adjusted for currency; International fourth quarter
2014 year-to-date revenue change year-over-year adjusted for
currency; International fourth quarter 2014 sequential revenue
change adjusted for currency; fourth quarter 2014 operating income
and operating margin adjusted for amortization, restructuring
charges and management transition costs; fourth quarter 2014
year-to-date operating income and operating margin adjusted for
amortization, restructuring charges, and management transition
costs; third quarter 2014 operating margin adjusted for
amortization, restructuring charges, and management transition
costs; fourth quarter 2013 operating margin adjusted for
amortization, restructuring charges and management transition
costs; fourth quarter 2013 year-to-date operating margin adjusted
for amortization, restructuring charges, and management transition
costs; fourth quarter 2014 net income from continuing operations
and net income per share from continuing operations adjusted for
amortization, restructuring charges, and management transition
costs; fourth quarter 2014 year-to-date net income from
continuing operations and net income per share from continuing
operations adjusted for amortization, restructuring charges, and
management transition costs; third quarter 2014 net loss from
continuing operations and net loss per share from continuing
operations adjusted for amortization, restructuring charges, and
management transition costs; fourth quarter 2013 net income from
continuing operations and net income per share from continuing
operations adjusted for amortization, restructuring charges, and
management transition costs; and fourth quarter 2013 year-to-date
net income per share from continuing operations adjusted for
amortization, restructuring charges, and management transition
costs; fourth quarter 2014 year-to-date SG&A expenses before
management transition costs; and fourth quarter 2013 year-to-date
SG&A expenses before management transition costs.
Reconciliations of non-GAAP to comparable GAAP measures are
available in the schedules accompanying this release. These
reconciliations may also be found in the Investor Relations section
of the Company's website at www.ciber.com/cbr.
Forward-Looking
Statements
This press release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995
relating to our operations, results of operations and other matters
that are based on our current expectations, estimates, forecasts
and projections. Words, such as "anticipate," "believe," "could,"
"expect," "estimate," "intend," "may," "opportunity," "plan,"
"positioned," "potential," "project," "should," and "will" and
similar expressions, are intended to identify these forward-looking
statements. These statements are not guarantees of future
performance and involve risks, uncertainties and assumptions that
are difficult to predict. Forward-looking statements are based on
assumptions as to future events that may not prove to be accurate.
Risks, uncertainties and other factors that could cause actual
results to differ materially from those expressed or implied by our
forward-looking statements include, but are not limited to, risks
that: our results of operations may be adversely affected if
we are unable to execute on the key elements of our strategic plan
or our strategic plan proves to be less successful than
anticipated; if we are not able to anticipate and keep pace with
rapid changes in technology, our business may be negatively
affected; a data security or privacy breach could adversely
affect our business; we may experience declines in revenue and
profitability if we do not accurately estimate the cost of
engagements conducted on a fixed-price basis; our business could be
adversely affected if our clients are not satisfied with our
services, and we could face damage to our professional reputation
and/or legal liability; termination of a contract by a significant
client and/or cancellation with short notice could adversely affect
our results of operations; our results of operations can be
adversely affected by economic conditions and the impacts of
economic conditions on our clients' operations and technology
spending; if we do not continue to improve our operational,
financial and other internal controls and systems to manage our
growth and size or if we are unable to enter, operate and compete
effectively in new geographic markets, our results of operations
may suffer and the value of our business may be harmed; our brand
and reputation are key assets and competitive advantages of our
Company and our business may be affected by how we are perceived in
the marketplace; our future success depends on our ability to
continue to retain and attract qualified sales, delivery and
technical employees; we cannot guarantee that we are in compliance
with all applicable laws and regulations; if we are unable to
protect our intellectual property rights from unauthorized use or
infringement by third parties, our business could be adversely
affected; our services or solutions could infringe upon the
intellectual property rights of others, or we might lose our
ability to utilize rights we claim in intellectual property or the
intellectual property of others; if we are unable to collect our
receivables, our results of operations and cash flows could be
adversely affected; our credit agreement, an asset-based loan
facility, limits our operational and financial flexibility; our
revenues, operating results and profitability will vary from
quarter to quarter and may result in increased volatility in the
price of our stock; our international operations expose us to
additional risks that could have adverse effects on our business
and operating results; the IT services industry, in the U.S. and
internationally, is highly competitive, with increased focus on
offshore capability and we may not be able to compete effectively
in this evolving marketplace; our operations are vulnerable to
disruptions that may impact our results of operations and from
which we may not recover; we might not be successful at
identifying, acquiring, or integrating businesses or entering into
joint ventures; we could incur additional losses due to further
impairment in the carrying value of our goodwill; we depend on
contracts with various public sector agencies for a significant
portion of our revenue and, if the spending policies or budget
priorities of these agencies change, we could lose revenue;
unfavorable government audits could require us to adjust previously
reported operating results, to forego anticipated revenue and
subject us to penalties and sanctions; we have adopted
anti-takeover defenses that could make it difficult for another
company to acquire control of Ciber or limit the price investors
might be willing to pay for our stock, thus affecting the market
price of our securities. For a more detailed discussion of
these factors, see the information under the "Risk Factors" heading
in our Annual Report on Form 10-K for the year ended December 31,
2014, and other documents filed with or furnished to the Securities
and Exchange Commission. We undertake no obligation to publicly
update any forward-looking statements in light of new information
or future events. Readers are cautioned not to put undue reliance
on forward-looking statements.
About Ciber, Inc.
Ciber is a leading global IT consulting company with some 6,500
consultants and contractors in North America, Europe and
Asia/Pacific, and approximately $1 billion of annual business.
Client focused and results driven, Ciber partners with
organizations to develop technology strategies and solutions that
deliver tangible business value. Founded in 1974, the company
trades on the New York Stock Exchange (NYSE: CBR). For more
information, visit www.ciber.com.
###
Contact:
Christian Mezger
Investor Relations
303-267-3857
cmezger@ciber.com
Bonnie Bird
Media Relations
303-220-0100
bbird@ciber.com
CBR Q4 2014 Earnings Release
Tables
This
announcement is distributed by NASDAQ OMX Corporate Solutions on
behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the
information contained therein.
Source: Ciber, Inc via Globenewswire
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