EX-99.1 2 l15232aexv99w1.htm EXHIBIT 99.1 PRESS RELEASE Exhibit 99.1
 

Exhibit 99.1
(CBIZ LOGO)   (PRESS RELEASE)
         
FOR IMMEDIATE RELEASE
  CONTACT:   Ware Grove
 
      Chief Financial Officer
 
      -or-
 
      Lori Novickis
 
      Corporate Relations
 
      (216) 447-9000
CBIZ REPORTS SECOND-QUARTER AND FIRST-HALF 2005 RESULTS
REVENUE GROWS 12.7%; SAME-UNIT REVENUE GROWS 7.9%
Cleveland, Ohio (July 26, 2005)—CBIZ (Century Business Services, Inc.) (NASDAQ: CBIZ) today announced second-quarter and first-half results for the period ended June 30, 2005.
CBIZ reported revenue of $139.6 million for the second quarter ended June 30, 2005, an increase of 12.7% over the $123.9 million recorded for the second quarter of 2004. Same-unit revenue for the second quarter increased by 7.9%, or $9.8 million. Revenue from newly acquired operations contributed $6.1 million to revenue growth in the second quarter of 2005, while divested operations resulted in a revenue decline of $0.2 million compared with the second quarter a year ago. CBIZ reported income from continuing operations of $4.5 million for the second quarter 2005, or $0.06 per diluted share, compared with $3.4 million, or $0.04 per diluted share in the second quarter of 2004.
Through June 30, 2005, the Company had repurchased approximately 1.9 million shares, and through today, the Company has repurchased an additional 550,000 shares of common stock. The cost of this total purchase of approximately 2.4 million shares of common stock was approximately $9.9 million. At June 30, 2005, bank debt was $50.3 million compared with $67.5 million at the end of the first quarter of 2005.
For the six-month period ended June 30, 2005, CBIZ reported revenue of $295.0 million, a 9.8%, or $26.3 million increase over the $268.7 million recorded for the comparable six-month period a year ago. Same-unit revenue increased by 5.0%, or $13.4 million, for the first six months of 2005 compared to the same period a year ago. Acquisitions contributed $13.6 million to revenue growth for the first six months of 2005, while divested operations accounted for a revenue decline of $0.7 million compared with the same period a year ago. Income from continuing operations was $14.6 million for the first six months of 2005, or $0.19 per diluted share, compared with $16.2 million for the first six months of 2004, or $0.19 per diluted share.
“We are very pleased with our second quarter results,” stated Steven L. Gerard, Chairman and CEO. “The revenue and gross margin contributions of each of our four business segments improved over last year and our strong cash flow enabled us to both reduce our debt and continue our share repurchase program. This represents the eighth consecutive quarter of same-unit revenue growth. The second quarter’s 7.9% growth rate was the highest increase we have reported over this two-year period. We remain on track to achieve our goal of 20-
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6050 Oak Tree Boulevard, South • Suite 500 • Cleveland, OH 44131 • Phone (216) 447-9000 • Fax (216) 447-9007

 

 

25% increase in earnings per share for the full year 2005 over the $0.21 reported for the full year 2004,” concluded Mr. Gerard.
CBIZ will host a conference call later this morning to discuss its results. The call will be webcast in a listen-only mode over the Internet for the media and the public, and can be accessed at www.cbiz.com. Shareholders and analysts wishing to participate in the conference call may dial 1-888-545-0687 several minutes before 11:00 a.m. (ET). If you are dialing from outside the United States, dial 1-630-691-2764. A replay of the call will be available starting at 1:00 p.m. (ET), July 26 through midnight (ET), July 29, 2005. The dial-in number for the replay is 1-877-213-9653. If you are listening from outside the United States, dial 1-630-652-3041. The access code for the replay is 12195425. A replay of the webcast will also be available on the Company’s web site at www.cbiz.com.
CBIZ is a provider of professional business services to companies throughout the United States. As the largest benefits specialist, one of the top accounting, valuation and medical practice management companies in the United States, CBIZ provides integrated services in the following areas: accounting and tax; employee benefits; wealth management; property and casualty insurance; payroll; IS consulting; and HR consulting. CBIZ also provides internal audit; Sarbanes-Oxley section 404 compliance; valuation; litigation advisory; government relations; commercial real estate advisory; wholesale life and group insurance; healthcare consulting; medical practice management; and capital advisory services. These services are provided throughout a network of more than 140 Company offices in 34 states and the District of Columbia.
Forward-looking statements in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected. Such risks and uncertainties include, but are not limited to, the Company’s ability to adequately manage its growth; the Company’s dependence on the current trend of outsourcing business services; the Company’s dependence on the services of its CEO and other key employees; competitive pricing pressures; general business and economic conditions; and changes in governmental regulation and tax laws affecting its insurance business or its business services operations. A more detailed description of such risks and uncertainties may be found in the Company’s filings with the Securities and Exchange Commission.
     For further information regarding CBIZ, call our Investor Relations Office at (216) 447-9000 or visit our web site at www.cbiz.com.
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6050 Oak Tree Boulevard, South • Suite 500 • Cleveland, OH 44131 • Phone (216) 447-9000 • Fax (216) 447-9007

 

 

CENTURY BUSINESS SERVICES, INC.
FINANCIAL HIGHLIGHTS (UNAUDITED)
THREE MONTHS ENDED JUNE 30, 2005 AND 2004
(In thousands, except percentages and per share data)
                                 
    THREE MONTHS ENDED  
    JUNE 30,  
                         
    2005     %     2004 (1)     %  
Revenue
   $ 139,635       100.0 %   $ 123,920       100.0 %
 
                                
Operating expenses
     121,482       87.0 %     109,151       88.1 %
 
                                
 
                        
Gross margin
     18,153       13.0 %     14,769       11.9 %
 
                                
Corporate general and administrative expense
     7,449       5.4 %     6,023       4.9 %
Depreciation and amortization expense
     3,828       2.7 %     4,072       3.2 %
 
                                
 
                        
Operating income
     6,876       4.9 %     4,674       3.8 %
 
                                
Other income (expense):
                                
Interest expense
     (845 )     -0.6 %     (429 )     -0.3 %
Gain on sale of operations, net
     —       0.0 %     534       0.4 %
Other income, net
     999       0.7 %     292       0.2 %
 
                        
Total other income, net
     154       0.1 %     397       0.3 %
 
                                
Income from continuing operations before income tax expense
     7,030       5.0 %     5,071       4.1 %
 
                                
Income tax expense
     2,577               1,685          
 
                                
 
                        
Income from continuing operations
     4,453       3.2 %     3,386       2.7 %
 
                                
Loss from operations of discontinued businesses, net of tax
     (1,127 )             (1,004 )        
Loss on disposal of discontinued businesses, net of tax
     —               —          
 
                                
 
                        
Net income
   $ 3,326       2.4 %   $ 2,382       1.9 %
 
                            
 
                                
Diluted earnings (loss) per share:
                                
Continuing operations
   $ 0.06             $ 0.04          
Discontinued operations
     (0.02 )             (0.01 )        
 
                            
Net income
   $ 0.04             $ 0.03          
 
                            
 
                                
Diluted shares outstanding
     76,947               80,150          
 
                                
Other data from continuing operations:
                                
EBIT (2)
   $ 7,875             $ 4,966          
EBITDA (2)
   $ 11,703             $ 9,038          
(1) Certain amounts in the 2004 financial data have been reclassified to conform to the current year presentation.
(2) EBIT represents income from continuing operations before income taxes, interest expense, and gain on divested operations. EBITDA represents EBIT as defined above before depreciation and amortization expense. The Company has included EBIT and EBITDA data because such data is commonly used as a performance measure by analysts and investors and as a measure of the Company’s ability to service debt. EBIT and EBITDA should not be regarded as an alternative or replacement to any measurement of performance under generally accepted accounting principles (GAAP).

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6050 Oak Tree Boulevard, South • Suite 500 • Cleveland, OH 44131 • Phone (216) 447-9000 • Fax (216) 447-9007

 

CENTURY BUSINESS SERVICES, INC.
FINANCIAL HIGHLIGHTS (UNAUDITED)
SIX MONTHS ENDED JUNE 30, 2005 AND 2004
(In thousands, except percentages and per share data)
                                 
    SIX MONTHS ENDED  
    JUNE 30,  
                         
    2005     %     2004 (1)     %  
                                 
Revenue
   $ 294,993       100.0 %   $ 268,722       100.0 %
 
                                
Operating expenses
     248,918       84.4 %     223,275       83.1 %
 
                                
 
                        
Gross margin
     46,075       15.6 %     45,447       16.9 %
 
                                
Corporate general and administrative expense
     13,872       4.7 %     11,749       4.4 %
Depreciation and amortization expense
     7,787       2.6 %     7,967       2.9 %
 
                                
 
                        
Operating income
     24,416       8.3 %     25,731       9.6 %
 
                                
Other income (expense):
                                
Interest expense
     (1,626 )     -0.6 %     (669 )     -0.2 %
Gain on sale of operations, net
     —       0.0 %     917       0.3 %
Other income, net
     1,557       0.5 %     824       0.3 %
 
                        
Total other income (expense), net
     (69 )     -0.1 %     1,072       0.4 %
 
                                
Income from continuing operations before income tax expense
     24,347       8.2 %     26,803       10.0 %
 
                                
Income tax expense
     9,764               10,617          
 
                                
 
                        
Income from continuing operations
     14,583       4.9 %     16,186       6.0 %
 
                                
Loss from operations of discontinued businesses, net of tax
     (3,011 )             (2,223 )        
Loss on disposal of discontinued businesses, net of tax
     (109 )             —          
 
                        
Net income
   $ 11,463       3.9 %   $ 13,963       5.2 %
 
                            
 
                                
Diluted earnings (loss) per share:
                                
Continuing operations
   $ 0.19             $ 0.19          
Discontinued operations
     (0.04 )             (0.02 )        
 
                            
Net income
   $ 0.15             $ 0.17          
 
                            
 
                                
Diluted shares outstanding
     77,338               84,038          
 
                                
Other data from continuing operations:
                                
EBIT (2)
   $ 25,973             $ 26,555          
EBITDA (2)
   $ 33,760             $ 34,522          
(1) Certain amounts in the 2004 financial data have been reclassified to conform to the current year presentation.
(2) EBIT represents income from continuing operations before income taxes, interest expense, and gain on divested operations. EBITDA represents EBIT as defined above before depreciation and amortization expense. The Company has included EBIT and EBITDA data because such data is commonly used as a performance measure by analysts and investors and as a measure of the Company’s ability to service debt. EBIT and EBITDA should not be regarded as an alternative or replacement to any measurement of performance under generally accepted accounting principles (GAAP).

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6050 Oak Tree Boulevard, South • Suite 500 • Cleveland, OH 44131 • Phone (216) 447-9000 • Fax (216) 447-9007

 

CENTURY BUSINESS SERVICES, INC.
FINANCIAL HIGHLIGHTS (UNAUDITED)
THREE AND SIX MONTHS ENDED JUNE 30, 2005 AND 2004
(In thousands, except percentages and ratios)
                                 
    THREE MONTHS ENDED     SIX MONTHS ENDED  
    JUNE 30,     JUNE 30,  
    2005     2004 (3)     2005     2004 (3)  
Revenue
                                
Accounting, Tax & Advisory Services
   $ 58,657     $ 49,648     $ 138,087     $ 120,205  
Benefits & Insurance Services
     36,862       36,267       72,587       72,314  
National Practices — Other
     19,834       16,486       36,864       34,144  
Medical Practice Management
     24,282       21,519       47,455       42,059  
Total
   $ 139,635     $ 123,920     $ 294,993     $ 268,722  
 
                                
Gross margin
                                
Accounting, Tax & Advisory Services
   $ 6,801     $ 4,855     $ 30,393     $ 26,354  
Benefits & Insurance Services
     7,969       7,746       13,854       15,251  
National Practices — Other
     2,733       1,553       3,860       3,696  
Medical Practice Management
     4,590       3,705       8,136       6,848  
Total (1)
   $ 18,153     $ 14,769     $ 46,075     $ 45,447  
SELECT BALANCE SHEET DATA AND RATIOS
                 
    JUNE 30,     DECEMBER 31,  
    2005     2004 (3)  
Cash and cash equivalents
   $ 3,506     $ 5,291  
Restricted cash
   $ 10,782     $ 10,089  
Accounts receivable, net
   $ 114,248     $ 100,426  
Total current assets before funds held for clients
   $ 152,152     $ 152,703  
Funds held for clients
   $ 57,725     $ 32,787  
Goodwill and other intangible assets
   $ 178,768     $ 172,644  
 
                
Total assets
   $ 448,066     $ 413,773  
 
              
Current liabilities before client fund obligations
   $ 75,876     $ 73,315  
Client fund obligations
   $ 57,725     $ 32,787  
Bank debt
   $ 50,250     $ 53,900  
 
                
Total liabilities
   $ 196,077     $ 167,276  
 
                
Treasury stock
   $ (93,227 )   $ (85,650 )
 
                
Total stockholders’ equity
   $ 251,989     $ 246,497  
 
                
Bank debt to equity
     19.9 %     21.9 %
Days sales outstanding (2)
     75       73  
 
                
Shares outstanding
     74,371       75,651  
 
            
Basic shares outstanding
     75,455       79,217  
 
            
Diluted shares outstanding
     77,338       81,477  
 
            
(1) Includes operating expenses recorded by corporate and not directly allocated to the business units of $3,940 and $3,090 for the three months ended June 30, 2005 and 2004, and $10,168 and $6,702 for the six months ended June 30, 2005 and 2004, respectively.
(2) Days sales outstanding (DSO) represent accounts receivable (before the allowance for doubtful accounts) and unbilled revenue (net of realization adjustments) at the end of the period, divided by daily revenue. The Company has included DSO data because such data is commonly used as a performance measure by analysts and investors and as a measure of the Company’s ability to collect on receivables in a timely manner. DSO should not be regarded as an alternative or replacement to any measurement of performance under generally accepted accounting principles (GAAP).
(3) Certain amounts in the 2004 financial data have been reclassified to conform to the current year presentation.

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6050 Oak Tree Boulevard, South • Suite 500 • Cleveland, OH 44131 • Phone (216) 447-9000 • Fax (216) 447-9007