Exhibit 99.1
| For additional information contact: |
| Richard S. DeRose (703) 293-7901 |
| For release: |
| November 18, 2003 at 9:00 a.m. |
Information Analysis Inc. Reports Third Quarter Results
FAIRFAX, VIRGINIA – Information Analysis Inc. (IAIC:OTCBB) today reported results for the third quarter of fiscal 2003 ended September 30, 2003. Revenues were $1,483,000, up from the $1,224,000 reported in 2002’s third quarter. The information technology services company reported a net income of $11,000, or $0.00 per share basic and diluted, compared to a net loss of $30,000, or $0.00 per share basic and diluted, in 2002’s third quarter
For the nine months ended September 30, 2003, IAI’s revenues were $3,586,000, compared to revenues of $4,837,000 for the same period in 2002. The Company reported a net loss of $254,000, or ($0.02) per share basic and diluted, in contrast to a net income of $144,000, or $0.01 per share basic and diluted, reported for the comparable 2002 period.
“We experienced an increase in the third quarter revenue compared to the first two quarters of the year, and have returned to profitable operations. I am encouraged by what we have accomplished during this quarter to position the Company for the rest of this year and the future,” said Sandor Rosenberg, Chairman and Chief Executive Officer of IAI. “Our contract wins have contributed to our increased revenue stream. In addition, we have continued to contain and reduce general and administrative expenses, a measure which contributes to both overall profitability and reduced cash flow requirements.
“The Company is continuing the active pursuit of the conversion and system modernization business in addition to developing business opportunities in the area of Web applications. We have been working on some large opportunities which should significantly build our pipeline for the upcoming year. This increased activity should help make the company stronger and give us momentum as we enter 2004 and beyond.
“We still are in merger and acquisition discussions with a number of firms and hope to complete a transaction in the future.”
About Information Analysis Incorporated
Information Analysis Incorporated (www.infoa.com), headquartered in Fairfax, Virginia, is an information technology services company. The Company is a web solution provider and software conversion specialist, modernizing legacy systems and extending their reach to the internet world.
Additional information for investors
This release may contain forward-looking statements regarding the Company’s business, customer prospects, or other factors that may affect future earnings or financial results. Such statements involve risks and uncertainties which could cause actual results to vary materially from those expressed in the forward-looking statements. Investors should read and understand the risk factors detailed in the Company’s 10-KSB for the fiscal year ended December 31, 2002 and in other filings with the Securities and Exchange Commission.
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Information Analysis Inc. Reports Third Quarter Results
November 18, 2003
Page 2 of 4
Information Analysis Incorporated
Condensed Consolidated Income Statements
| Three months ended September 30, |
||||||||
| (in thousands, except per share data; unaudited) | 2003 |
2002 |
||||||
| Revenue: |
||||||||
| Professional fees |
$ | 1,426 | $ | 944 | ||||
| Software sales |
57 | 280 | ||||||
| Total revenue |
1,483 | 1,224 | ||||||
| Cost of goods sold and services provided: |
||||||||
| Cost of professional fees |
1,140 | 705 | ||||||
| Cost of software sales |
59 | 134 | ||||||
| Total cost of sales |
1,199 | 839 | ||||||
| Gross margin |
284 | 385 | ||||||
| Selling, general and administrative expense |
264 | 406 | ||||||
| Operating income (loss) |
20 | (21 | ) | |||||
| Other expense |
(9 | ) | (9 | ) | ||||
| Income (loss) before income taxes |
11 | (30 | ) | |||||
| Provision for income taxes |
— | — | ||||||
| Net income (loss) |
$ | 11 | $ | (30 | ) | |||
| Earnings per common share: |
||||||||
| Basic: Net income (loss) |
$ | 0.00 | $ | 0.00 | ||||
| Diluted: Net income (loss) |
$ | 0.00 | $ | 0.00 | ||||
| Shares used in calculating earnings per share: |
||||||||
| Basic |
10,283,515 | 10,283,515 | ||||||
| Diluted |
10,329,468 | 10,283,515 | ||||||
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Information Analysis Inc. Reports Third Quarter Results
November 18, 2003
Page 3 of 4
Information Analysis Incorporated
Condensed Consolidated Income Statements
| Nine months ended September 30, |
||||||||
| (in thousands, except per share data; unaudited) | 2003 |
2002 |
||||||
| Revenue: |
||||||||
| Professional fees |
$ | 3,339 | $ | 4,301 | ||||
| Software sales |
247 | 536 | ||||||
| Total revenue |
3,586 | 4,837 | ||||||
| Cost of goods sold and services provided: |
||||||||
| Cost of professional fees |
2,610 | 2,979 | ||||||
| Cost of software sales |
242 | 346 | ||||||
| Total cost of sales |
2,852 | 3,325 | ||||||
| Gross margin |
734 | 1,512 | ||||||
| Selling, general and administrative expense |
967 | 1,355 | ||||||
| Operating (loss) income |
(233 | ) | 157 | |||||
| Other expense |
(21 | ) | (13 | ) | ||||
| (Loss) income before income taxes |
(254 | ) | 144 | |||||
| Provision for income taxes |
— | — | ||||||
| Net (loss) income |
$ | (254 | ) | $ | 144 | |||
| Net loss per share: |
||||||||
| Basic: Net (loss) income |
$ | (0.02 | ) | $ | 0.01 | |||
| Diluted: Net (loss) income |
$ | (0.02 | ) | $ | 0.01 | |||
| Shares used in calculating earnings per share: |
||||||||
| Basic |
10,283,515 | 10,283,515 | ||||||
| Diluted |
10,283,515 | 10,923,515 | ||||||
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Information Analysis Inc. Reports Third Quarter Results
November 18, 2003
Page 4 of 4
Information Analysis Incorporated and Subsidiaries
Consolidated Balance Sheets
| As of September 30, |
As of December 31, |
|||||||
| (in thousands) | (unaudited) | (audited) | ||||||
| ASSETS |
||||||||
| Current assets: |
||||||||
| Cash and cash equivalents |
$ | 4 | $ | 81 | ||||
| Accounts receivable, net |
1,284 | 824 | ||||||
| Prepaid expenses |
96 | 29 | ||||||
| Other receivables |
24 | 16 | ||||||
| Total current assets |
1,408 | 950 | ||||||
| Fixed assets, net |
32 | 43 | ||||||
| Capitalized software, net |
84 | 146 | ||||||
| Note receivable |
85 | 85 | ||||||
| Investments |
6 | 6 | ||||||
| Other assets |
37 | 51 | ||||||
| Total assets |
$ | 1,652 | $ | 1,281 | ||||
| LIABILITIES & STOCKHOLDERS’ EQUITY |
||||||||
| Current liabilities: |
||||||||
| Accounts payable |
$ | 882 | $ | 474 | ||||
| Accrued payroll and related payroll items |
238 | 215 | ||||||
| Other accrued liabilities |
206 | 128 | ||||||
| Revolving line of credit |
537 | 403 | ||||||
| Deferred revenue |
120 | 138 | ||||||
| Total current liabilities |
1,983 | 1,358 | ||||||
| Long-term debt |
125 | 125 | ||||||
| Total liabilities |
2,108 | 1,483 | ||||||
| Common stock, par value $0.01, 30,000,000 shares authorized; 11,788,126 shares issued, 10,283,515 outstanding at September 30, 2002 and December 31, 2001, respectively |
118 | 118 | ||||||
| Additional paid in capital |
14,122 | 14,122 | ||||||
| Accumulated deficit |
(13,836 | ) | (13,582 | ) | ||||
| Accumulated other comprehensive income |
(6 | ) | (6 | ) | ||||
| Less treasury stock; 1,504,611 shares at cost |
(854 | ) | (854 | ) | ||||
| Total stockholders’ equity |
(456 | ) | (202 | ) | ||||
| Total liabilities and stockholders’ equity |
$ | 1,652 | $ | 1,281 | ||||
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