SOURCE: Analysts International

February 27, 2007 08:00 ET

Analysts International Reports Results for 2006

MINNEAPOLIS, MN -- (MARKET WIRE) -- February 27, 2007 -- Analysts International (NASDAQ: ANLY) today reported the results for its fourth quarter ended December 30, 2006. Revenues totaled $86.8 million for the quarter, compared to $85.9 million for the comparable quarter a year ago. For the quarter, the Company reported a net loss of $(534,000), or $(.02) per diluted share, compared to net income of $1.0 million or $.04 per diluted share for the fourth quarter of 2005.

For the twelve months ended December 30, 2006, the Company reported revenues of $347.0 million compared to $322.3 million in fiscal year 2005. The net loss for the year was $(1.1) million, or $(.04) per diluted share, compared to a net loss of $(17.7) million in 2005, or $(.72) per diluted share. The twelve months ended December 31, 2005 includes merger-related costs and other special charges totaling $14.9 million or $(.61) per diluted share. Excluding these charges, the Company lost $(2.8) million or $(.11) per diluted share for the year ended December 31, 2005.

Analysts will host a conference call today at 9:30 a.m. CT to discuss these results in detail and answer questions participants may have. Interested parties may access the call by dialing 1-800-418-7236 or 1-973-935-8757 for international participants a few minutes before the scheduled start and ask for the Analysts International conference call moderated by Company President and CEO, Mike LaVelle. The call may also be accessed via the internet at www.analysts.com, where it will be archived. Interested parties can also hear a replay of the call from 11:30 a.m. CT February 27, 2007 until 10:59 p.m. CT on March 6, 2007, by calling 1-877-519-4471 and using access code 8386150. The Company will also file an 8-K with the Securities and Exchange Commission that will provide a full transcript of the prepared remarks delivered on the call.

About Analysts International

Headquartered in Minneapolis, Analysts International is a diversified IT services company. In business since 1966, the company has sales and customer support offices in the United States and Canada. Lines of business include Full Service Staffing, which provides high demand resources for supporting a client's IT staffing needs; Solutions Services, which provides business solutions and network infrastructure services; Managed IT Services and Government Solutions. The company partners with best-in-class IT organizations, allowing access to a wide range of expertise, resources and expansive geographical reach. For more information, visit www.analysts.com.

                      Analysts International Corporation
                    Consolidated Statements of Operations
                                (unaudited)

                                 Three Months Ended   Twelve Months Ended
                                --------------------  --------------------
(in thousands except per share  December   December   December   December
 amounts)                       30, 2006   31, 2005   30, 2006   31, 2005

Professional Services Revenue:
  Provided directly             $  64,520  $   65,762 $ 261,489  $ 263,121
  Provided through subsuppliers    14,708      11,556    54,902     34,431
  Product sales                     7,532       8,532    30,596     24,746
                                ---------  ---------- ---------  ---------
    Total revenue                  86,760      85,850   346,987    322,298

Expenses:
  Salaries, contracted services
   and direct charges              65,176      62,880   260,619    240,100
  Cost of product sales             6,947       7,819    27,149     22,550
  Selling, administrative and
   other operating costs           14,746      13,657    58,847     61,053
  Amortization of intangible
   assets                             267         253     1,053        982
  Restructuring and other
   severance related costs              3          10       (51)     3,914
  Loss on asset disposal               --           8        --      1,825
  Goodwill impairment                  --          --        --      7,050
  Merger related expenses              --          16      (327)     2,129
                                ---------  ---------- ---------  ---------

Operating (loss) income              (379)      1,207      (303)   (17,305)
Non-operating income                    5          24        20         50
Interest expense                      150         215       736        394
                                ---------  ---------- ---------  ---------

(Loss) income before income
 taxes                               (524)      1,016    (1,019)   (17,649)
Income tax expense                     10          50        41         50
                                ---------  ---------- ---------  ---------
Net (loss) gain                 $    (534) $      966 $  (1,060) $ (17,699)
                                =========  ========== =========  =========

Per common share:
  Basic (loss) gain             $    (.02) $      .04 $    (.04) $    (.72)
                                =========  ========== =========  =========
  Diluted (loss) gain           $    (.02) $      .04 $    (.04) $    (.72)
                                =========  ========== =========  =========

Average common shares
 outstanding                       24,688      24,597    24,645     24,495
Average common and common
 equivalent shares outstanding     24,688      24,826    24,645     24,495



                      Analysts International Corporation
                          Consolidated Balance Sheets



                                                December 30,   December 31,
                                                    2006          2005
(in thousands)                                  (unaudited)
                                                ------------- -------------
Assets

Current assets:
  Cash and cash equivalents                     $         179 $          64
  Accounts receivable, less allowance for
   doubtful accounts                                   64,196        66,968
  Other current assets                                  2,484         2,383
                                                ------------- -------------
    Total current assets                               66,859        69,415

Property and equipment, net                             2,925         4,056
Other assets                                           26,447        28,533
                                                ------------- -------------
    Total assets                                $      96,231 $     102,004
                                                ============= =============

Liabilities and Shareholders’ Equity

Current liabilities:
  Accounts payable                              $      24,411 $      24,581
  Salaries and vacations                                7,416         8,260
  Line of credit                                        2,661         5,000
  Deferred revenue                                      1,267         1,645
  Restructuring accrual, current portion                  385           971
  Self-insured health care reserves and other
   amounts                                              1,670         2,242
  Deferred compensation                                   208           534
                                                ------------- -------------
    Total current liabilities                          38,018        43,233

Non-current liabilities:
  Deferred compensation                                 2,319         1,878
  Restructuring accrual                                   160           581

Shareholders’ equity                                   55,734        56,312
                                                ------------- -------------
                                                $      96,231 $     102,004
                                                ============= =============


                    Analysts International Corporation
             Reconciliation of non-GAAP Financial Measures
                              (in thousands)

                                 Three Months Ended   Twelve Months Ended
                                --------------------  --------------------
                                December   December   December   December
                                30, 2006   31, 2005   30, 2006   31, 2005

Net (loss) income as reported   $    (534) $      966 $  (1,060) $ (17,699)

Plus:
Merger related costs                   --          16      (327)     2,129
Restructuring and severance
 related costs                          3          10       (51)     3,914
Asset write-off                        --           8        --      1,825
Goodwill impairment                    --          --        --      7,050
                                ---------  ---------- ---------  ---------

  Total special charges                 3          34      (378)    14,918
                                ---------  ---------- ---------  ---------

(Loss) income before special
 charges                             (531)      1,000    (1,438)    (2,781)

Depreciation                          602         679     2,411      2,763
Amortization                          267         253     1,053        982
Net interest expense (income)         145         191       716        344
Income tax expense                     10          50        41         50
                                ---------  ---------- ---------  ---------

    Adjusted EBITDA*            $     493  $    2,173 $   2,783  $   1,358
                                =========  ========== =========  =========
*To supplement our consolidated financial statements presented in accordance with GAAP, we use the non-GAAP financial measure of Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) which is adjusted from results based on GAAP to exclude certain items. We have excluded the special costs associated with our attempted merger with Computer Horizons, our restructuring and severance-related costs, asset write-off, and goodwill impairment to provide a meaningful comparison between current results and prior reported results. This non-GAAP financial measure is provided to enhance the user's overall understanding of our current financial performance and our prospects for the future. This measure should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for or superior to GAAP results. The non-GAAP financial measure included in this press release has been reconciled to the nearest GAAP measure.

Contact Information

  • Contact:
    Adam Friedman
    Principal
    Adam Friedman Associates LLC
    Phone: 212-981-2529 Ext. 18