Public Conference Call Scheduled for Monday, May 15, 2006
at 4:15 PM ET
HAWTHORNE, N.Y., May 12, 2006 (PRIMEZONE) -- SmartPros Ltd. (AMEX:PED), a leader in the field of accredited professional education and corporate training, today reported its first quarter financial results for the three months ended March 31, 2006.
Financial highlights for the three months ended March 31, 2006 compared to the three months ended March 31, 2005:
-- Sales of the Company's core subscription-based products
grew approximately 7.6% to $1.83 million, up from $1.7
million.
-- Revenues were $2.53 million, representing an 11.1% decrease
from revenues of $2.85 million.
-- Net income decreased 30.6% to $150,015 compared to net income
of $216,092. This marked the sixth consecutive quarter of
profitability for SmartPros since the Company began reporting
as a public company in late 2004.
-- Online sales rose 13.4% to $687,000 from $606,000.
As of March 31, 2006, the Company had approximately $6.9 million in cash and cash equivalents, working capital of $4.1 million and stockholders' equity of approximately $7.2 million.
During the first quarter of 2006, SmartPros made the following fundamental improvements that are expected to help strengthen its future financial performance and market position:
-- Completed the acquisition of Sage Online Learning and initiated
the migration of its content library into SmartPros' core
offerings and onto its delivery platform. Sage's library is
comprised of 58 nationally certified, accredited courses in the
areas of banking compliance, general banking, general bank
management, insurance, lending, retirement and estate planning,
and industry-related sales and services.
-- Completed the acquisition of Skye Multimedia, which is now
operating as a wholly owned subsidiary of SmartPros responsible
for developing custom interactive marketing and training
applications for CD, DVD, Internet and Learning Management
Systems.
-- Expanded Working Values' library of off-the-shelf ethics and
compliance training modules with the market introduction of its
new Integrity Toolkit -- FastTrack(tm), a collection of
interactive web-based tools to help organizations readily deploy
and update integrated ethics and compliance training programs.
-- In collaboration with The Network of Trial Law Firms, Inc.
(TRIAL.com(r)), a not-for-profit association of 27 leading trial
and litigation law firms, SmartPros released a new online
Professional Education Center and Learning Management System
(LMS) to support The Network's Continuing Legal Education (CLE)
efforts. The system is a prototype for state-of-the-art
delivery of streaming video CLE in the broader legal industry.
Allen Greene, Chairman and Chief Executive Officer of SmartPros, stated, "The first quarter of 2006 has indeed been a period of tremendous activity for SmartPros, highlighted by the completion of two strategic acquisitions. Collectively, the investments we have been making in building upon our Company's proven and profitable platform should significantly enhance our long term growth prospects and help to further strengthen SmartPros' leadership in the professional education market place."
SmartPros will host a teleconference Monday, May 15, 2006 beginning at 4:15 p.m. Eastern, and invites all interested parties to join management in a discussion regarding the Company's financial results, corporate progression and other meaningful developments. The conference call can be accessed via telephone by dialing toll free 1-800-366-7417. A replay of the call will be available on the Company's Web site approximately one hour after the live broadcast at http://ir.smartpros.com. A copy of this news announcement is immediately accessible via http://ir.smartpros.com.
SMARTPROS LTD. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEET
March 31, December 31,
2006 2005
(Unaudited) (Audited)
---------------------------------------------------------------------
ASSETS
Current Assets:
Cash and cash equivalents $ 6,882,373 $ 7,505,691
Accounts receivable, net of
allowance for doubtful accounts
of $39,179 and $ 40,429 1,389,625 777,122
Prepaid expenses and other current
assets 247,902 254,176
----------------------------
Total Current Assets $ 8,519,900 $ 8,536,989
----------------------------
Property and equipment, net 494,758 493,604
Goodwill 53,434 53,434
Other intangibles, net 2,549,244 2,158,593
Other Assets, including restricted
cash of $150,000 204,673 150,000
----------------------------
3,302,109 2,855,631
----------------------------
Total Assets $ 11,822,009 $ 11,392,620
============================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable $ 256,619 $ 228,629
Accrued expenses 171,889 277,159
Current portion of capital lease
and equipment financing obligations 34,595 38,148
Deferred revenue 4,004,103 3,689,486
----------------------------
Total Current Liabilities 4,467,206 4,233,422
----------------------------
Long-Term Liabilities:
Capital lease and equipment
financing obligations 19,085 25,992
Other liabilities 140,165 160,193
----------------------------
Total Long-Term Liabilities 159,250 186,185
----------------------------
Commitments and Contingencies
Stockholders' Equity:
Convertible preferred stock, $.001 par
value, authorized 1,000,000 shares,
0 shares issued and outstanding -- --
Common stock, $.0001 par value,
authorized 30,000,000 shares,
5,170,005 issued and 5,060,274
outstanding at March 31, 2006 and
5,145,447 issued and 5,035,716
outstanding at December 31, 2005 517 514
Additional paid-in capital 16,480,056 16,418,034
Accumulated (deficit) (8,635,920) (8,785,935)
----------------------------
7,844,653 7,632,613
Common stock in treasury, at cost --
109,731 shares (384,600) (384,600)
Deferred compensation (64,500) (75,000)
Note receivable from stockholder (200,000) (200,000)
----------------------------
Total Stockholders' Equity 7,195,553 6,973,013
----------------------------
Total Liabilities and Stockholders'
Equity $ 11,822,009 $ 11,392,620
============================
SMARTPROS LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATION
Three Months Ended
March 31,
--------------------------
2006 2005
--------------------------
Net Revenues $ 2,533,579 $ 2,848,951
Cost of Revenues 986,687 1,082,709
--------------------------
Gross Profit 1,546,892 1,766,242
--------------------------
Operating Expenses:
Selling, general and administrative 1,367,679 1,435,160
Depreciation and amortization 148,071 141,243
--------------------------
1,515,750 1,576,403
---------------------------
Operating Income 31,142 189,839
--------------------------
Other Income (Expense):
Interest income 73,460 29,554
Interest Expense (1,587) (3,301)
--------------------------
71,873 26,253
--------------------------
Income before benefit for income taxes 103,015 216,092
Income Taxes Benefit (47,000) --
--------------------------
Net Income $ 150,015 $ 216,092
==========================
Net Income Per Common Share:
Basic net income per common share $ 0.03 $ 0.04
==========================
Diluted net income per common share $ 0.03 $ 0.04
==========================
Weighted Average Number of Shares
Outstanding
Basic 5,040,900 5,082,539
==========================
Diluted 5,057,916 5,117,294
==========================
About SmartPros Ltd.
Founded in 1981, SmartPros Ltd. is an industry leader in the field of accredited professional education and corporate training. Its products and services are primarily focused in the accredited professional areas of corporate accounting, financial management, public accounting, governmental and not-for-profit accounting, banking, engineering, and ethics and compliance. SmartPros is a leading provider of professional education products to Fortune 500 companies, as well as the major firms and associations in each of its professional markets. SmartPros provides education and content publishing and development services in a variety of media including Web, CD-ROM and video. Our subscription libraries feature hundreds of course titles and 1,000+ hours of accredited education. SmartPros' proprietary Professional Education Center (PEC) Learning Management System (LMS) offers enterprise distribution and administration of education content and information. In addition, SmartPros produces a popular news and information portal for accounting and finance professionals that services 300,000+ visitors and 100,000+ subscribers per month. Visit: www.smartpros.com
The SmartPros logo is available at http://www.primezone.com/newsroom/prs/?pkgid=2586
Safe Harbor Statement
Statements in this press release that are not statements of historical or current fact constitute "forward-looking statements." Results reported within this press release should not be considered an indication of future performance. Except for any historical information, the matters discussed in this press release contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements involve risks and uncertainties, including activities, events or developments that the Company expects, believes or anticipates will or may occur in the future. In addition to statements that explicitly describe these risks and uncertainties, readers are urged to consider statements that contain terms such as "believes," "belief," "expects," "expect," "intends," "intend," "anticipate," "anticipates," "plans," "plan," to be uncertain and forward-looking. The forward-looking statements contained herein are also subject generally to other risks and uncertainties that are described from time to time in our filings with Securities and Exchange Commission.