Exhibit 99.1
| For additional information contact: |
| Richard S. DeRose (703) 293-7901 |
| For immediate release |
Information Analysis, Inc. Reports First Quarter Profit
FAIRFAX, VIRGINIA – Information Analysis, Inc. (IAIC:OTCBB) today reported results for the first fiscal quarter ended March 31, 2004. Revenues were $2,116,000, up 130% from the $920,000 reported in 2003’s first quarter. The Company reported a net profit of $53,000, or $0.01 per share, compared to a loss of $191,000, or $0.02 per share, in 2003’s first quarter.
The Company attributes the improvement in the first quarter in comparison to the first quarter of 2003 to continued sales success and to reducing our cost structure. Sandor Rosenberg, Chairman and Chief Executive Officer of IAI said, “We are pleased with the results of the first quarter. We feel that the Company is continuing to build momentum from the past two quarters of last year which is steering us toward a successful year.
“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 second half of the year and carry us well into 2005.
“We still are in merger and acquisition discussions with a number of firms.”
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, 2003 and in other filings with the Securities and Exchange Commission.
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Information Analysis Reports First Quarter Results
May 18, 2004
Page 2 of 3
Information Analysis Incorporated
Condensed Consolidated Income Statements
| Three months ended March 31, |
||||||||
| (in thousands, except per share data; unaudited)
|
2004 |
2003 |
||||||
| Net revenue: |
||||||||
| Professional fees |
$ | 1,990 | $ | 826 | ||||
| Software sales |
126 | 94 | ||||||
| Total revenue |
2,116 | 920 | ||||||
| Cost of goods sold and services provided: |
||||||||
| Cost of professional fees |
1,661 | 622 | ||||||
| Cost of software sales |
66 | 84 | ||||||
| Total cost of sales |
1,727 | 706 | ||||||
| Gross margin |
389 | 214 | ||||||
| Operating expenses: |
||||||||
| Sales, general and administrative |
328 | 401 | ||||||
| Total operating expenses |
328 | 401 | ||||||
| Operating income (loss) |
61 | (187 | ) | |||||
| Other expense |
(8 | ) | (4 | ) | ||||
| Income (loss) before income taxes |
53 | (191 | ) | |||||
| Provision for income taxes |
— | — | ||||||
| Net income (loss) |
$ | 53 | $ | (191 | ) | |||
| Net income (loss) per share: |
||||||||
| Basic |
$ | 0.01 | $ | (0.02 | ) | |||
| Diluted |
$ | 0.01 | $ | (0.02 | ) | |||
| Shares used in calculating earnings per share: |
||||||||
| Basic |
10,283,515 | 10,283,515 | ||||||
| Diluted |
10,944,470 | 10,283,515 | ||||||
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Information Analysis Reports First Quarter Results
May 18, 2004
Page 3 of 3
Information Analysis Incorporated and Subsidiaries
Consolidated Balance Sheets
| As of: March 31, 2004 |
As of: December 31, 2003 |
|||||||
| (unaudited) | (Audited) | |||||||
| ASSETS |
||||||||
| Current assets: |
||||||||
| Cash and cash equivalents |
$ | 3 | $ | 318 | ||||
| Accounts receivable, net |
1,387 | 1,521 | ||||||
| Prepaid expenses |
128 | 116 | ||||||
| Note receivable |
85 | 85 | ||||||
| Capitalized software, net |
42 | 63 | ||||||
| Other receivables |
17 | 16 | ||||||
| Total current assets |
1,662 | 2,119 | ||||||
| Fixed assets, net |
28 | 31 | ||||||
| Investments |
6 | 6 | ||||||
| Other assets |
37 | 37 | ||||||
| Total assets |
$ | 1,733 | $ | 2,193 | ||||
| LIABILITIES & STOCKHOLDERS’ EQUITY |
||||||||
| Current liabilities: |
||||||||
| Accounts payable |
$ | 1,143 | $ | 1,151 | ||||
| Other accrued liabilities |
311 | 312 | ||||||
| Accrued payroll and related payroll items |
262 | 215 | ||||||
| Revolving line of credit |
158 | 689 | ||||||
| Notes payable |
125 | 125 | ||||||
| Deferred revenue |
116 | 136 | ||||||
| Total liabilities |
2,115 | 2,628 | ||||||
| Common stock, par value $0.01, 30,000,000 shares authorized; 11,788,126 shares issued, 10,283,515 outstanding at March 31, 2004 and December 31, 2003 |
118 | 118 | ||||||
| Additional paid in capital |
14,122 | 14,122 | ||||||
| Accumulated deficit |
(13,762 | ) | (13,815 | ) | ||||
| Accumulated other comprehensive income |
(6 | ) | (6 | ) | ||||
| Less treasury stock; 1,504,611 shares at cost |
(854 | ) | (854 | ) | ||||
| Total stockholders’ equity |
(382 | ) | (435 | ) | ||||
| Total liabilities and stockholders’ equity |
$ | 1,733 | 2,193 | |||||