ePlus Touts Q3 Revenues Rise

Enterprise cost management specialist sees higher cost of sales, stable net on better product sales


Enterprise cost management specialist sees higher cost of sales, stable net on better product sales

Herndon, VA — February 17, 2004 — Enterprise cost management specialist ePlus recorded an 8.9 percent increase in total revenues for its fiscal third quarter ended December 31, bringing in $79.8 million, as compared to $73.3 million the prior year, the solution provider announced last week.

Net earnings were $2.6 million, the same as the prior year's quarter, and net earnings for the nine months ended December 31 increased 6.9 percent to $7.6 million, up from $7.1 million the prior year.

At quarter's end, ePlus reported total stockholders equity of $113.8 million and cash of $26.8 million. On October 1, the company announced a stock repurchase plan, and the company repurchased 164,000 shares of common stock at a cost of $2.39 million during the quarter.

The increase in total revenues this quarter from the same period in 2002 was driven in part by a 14.2 percent increase in sales of product to $63.3 million from $55.5 million, which was offset by a 20.2 percent decrease in fee and other income to $3.6 million from $4.5 million.

Total costs and expenses increased 9.6 percent to $75.5 million from $68.9 million, driven in part by a 13.8 percent increase in the cost of sales for product to $55.8 million from $49.0 million, and an 8.8 percent decrease in salaries and benefits to $9.8 million from $10.8 million.

For the nine months ended December 31, ePlus recorded revenues of $245 million, a 7.6 percent increase over the $228 million for the same period in 2002, and net earnings of $7.6 million, a 6.9 percent increase as compared to $7.1 million for the same period in 2002.

"This was a solid quarter for ePlus, and in line with expectations," said Phillip Norton, chairman, president and CEO of ePlus. "We completed a major e-procurement implementation and content services project engagement for an entity of a Global 50 company, a significant achievement which should raise our visibility at large enterprise accounts."

Norton noted that this latest project included a Japanese language enhancement, implementation of more than 19,000 unique business rules for multiple commodity classes and rollout to more than 7,000 users in six countries.

ePlus reported that it had rolled out its Procure+ solution to one of the world's largest manufacturers of paper and building products. The hosted system will allow more than 1,000 information technology professionals in over 350 offices around the country to purchase technology equipment from more than 100 designated vendors. The system replaced an internal e-procurement system that has been in use for several years, and ePlus said it had won the contract after a lengthy evaluation of the major e-procurement vendors. The customer's selection of ePlus was based, in part, on the fact that ePlus already had built electronic catalogs for all of the IT vendors to be included in the project, reducing both ramp-up time and deployment costs, according to ePlus.

Elsewhere, the company implemented its Content+ solution for a provider of drilling and production solutions for the oil and gas industry. The content management solution is to be used as a sell-side solution to provide enriched data for each of its customers' customized e-catalogs. The customer will use Content+ to aggregate, classify and normalize product data for nearly 200,000 items, create enriched product descriptions and images for each e-catalog, and manage both content and catalogs through the system's workflow and maintenance tools. ePlus said it was selected after a two-year due diligence process that involved evaluating multiple content management vendors, including the top enterprise software and service providers. Content+ was chosen, in part, for its ability to quickly and automatically categorize hundreds of thousands of products and services using an integral knowledge base and its ability to feed cleansed data directly into the company's SAP enterprise resource planning (ERP) system.

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