ENGLEWOOD, Colo., Dec. 15 /PRNewswire-FirstCall/ -- CSG Systems
International, Inc., (Nasdaq: CSGS), a leading provider of customer care and
billing solutions, today announced it is revising fourth quarter 2005 guidance
to reflect the impact of one-time charges to be included in continuing
operations that are related to the closing of the sale of the GSS Business and
other related activities expected to be implemented before the end of 2005.
These charges were not considered in CSG's previously issued financial
guidance for the fourth quarter of 2005.
(Logo: http://www.newscom.com/cgi-bin/prnh/20020627/CSGSLOGO )
The total amount of these charges associated with the divestiture of the
GSS Business (which are discussed in greater detail below) is approximately
$9.1 million (of which approximately $4.3 million relates to non-cash
expense), or $0.12 per diluted share.
In addition, CSG announced the planned disposition of CSG's plaNet
Consulting Division. As a result of this decision, beginning in the fourth
quarter of 2005, CSG expects to reflect plaNet's results of operations as
discontinued operations for all periods presented. Expectations of revenues
and earnings from continuing operations will be revised for the fourth quarter
of 2005 to reflect plaNet's results as discontinued operations. For the
fourth quarter 2005, CSG's previous financial guidance for continuing
operations included revenues and expenses from plaNet of approximately $4
million each. For the full year 2005, plaNet's revenues and expenses are
expected to be approximately $14 million and approximately $17 million,
respectively (approximately $3 million of operating loss).
CSG's revised guidance for the fourth quarter for continuing operations to
reflect the impact of the $9.1 million of one-time charges related to the
closing of the divestiture of the GSS Business, and the decision to reflect
plaNet's results of operations as discontinued operations, is as follows:
Previous Revised
Guidance Guidance
Revenues $96 - $99 million $92 - $95 million
EPS $0.21 - $23 $0.09 - $0.11
The one-time charges related to the closing of the sale of the GSS
Business and other related activities referenced above that are expected to be
recorded in continuing operations for the fourth quarter of 2005 are as
follows:
* Stock-based compensation expense of approximately $3.9 million (a
non-cash expense) related to accelerated vesting of a portion of the
equity awards held by key members of CSG's management. The accelerated
vesting is the result of a change in control provision included in the
respective equity awards that was triggered by the closing of the sale
of the GSS Business.
* Expense of approximately $1.3 million (includes non-cash expense of $0.4
million) related to separation benefits as a result of the termination
of one of CSG's executive officers as a result of the closing of the GSS
Business. The cash portion of the separation benefits are expected to
be paid in the first quarter of 2006.
* Expense of approximately $1.3 million related to incentive bonuses for
certain members of CSG's management team involved in the divestiture of
the GSS Business. CSG expects to pay the incentive bonuses in the first
quarter of 2006.
* Expense of approximately $0.6 million related to the involuntarily
termination of employees performing corporate support functions. CSG
expects these termination benefits to be substantially paid in 2006.
* Expense of approximately $2 million related to the planned
disposition of CSG's corporate aircraft.
Cash flows from operations for the fourth quarter of 2005 will be
negatively impacted by these one-time events by approximately $3 million. As
a result, the company's new expectations for cash flow from operations is
approximately $21 million for the fourth quarter 2005. More information about
these matters can be found in CSG's most recently filed Form 8-K filed on
December 15, 2005.
About CSG Systems International
Headquartered in Englewood, Colorado, CSG Systems International
(Nasdaq: CSGS) is the leading provider of outsourced billing, customer care
and print and mail solutions and services supporting the North American
convergent broadband and direct broadcast satellite markets. CSG's solutions
support some of the world's largest and most innovative providers of bundled
multi-channel video, Internet, voice and IP-based services. CSG's unique
combination of solutions, services and expertise ensure that cable and
satellite operators can continue to rapidly launch new service offerings,
improve operational efficiencies and deliver a high-quality customer
experience in a competitive and ever-changing marketplace. For more
information, visit our website at http://www.csgsystems.com
This news release contains forward-looking statements as defined under the
Securities Act of 1933, as amended, that are based on assumptions about a
number of important factors and involve risks and uncertainties that could
cause actual results to differ materially from what appears in this news
release. These factors include, but are not limited to: 1) CSG's ability to
continue to perform satisfactorily and maintain good customer relations with
its three largest clients, Comcast Corporation, Echostar Communications, and
Time Warner, Inc., which combined make up over 50% of CSG's revenues from
continuing operations; 2) the continued acceptance of CSG ACP and its related
products and services; 3) CSG's ability to enhance current products and
develop new technology that will retain existing clients and capture new
market share; 4) significant forays into new markets, which may prove costly
and unprofitable; 5) the degree to which CSG's expectations of market
penetration and consumer acceptance of broadband, wireline and wireless
services prove true -- and even if realized, CSG's ability to meet the billing
and customer care needs of those markets; 6) client consolidation, which has
decreased the number of potential buyers for many of CSG's products and
services; 7) CSG's ability to renew contracts and sell additional products and
services to existing and new clients; and 8) CSG's ability to successfully
deliver on lengthy and/or complex implementation projects, which by their
nature, carry much more risk. This list is not exhaustive and readers are
encouraged to review the additional risks and important factors described in
CSG's reports on Forms 10-K and 10-Q and other filings made with the SEC.
SOURCE CSG Systems International, Inc.
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Related links:
http://www.csgsystems.com
Photo Notes:
NewsCom:
http://www.newscom.com/cgi-bin/prnh/20020627/CSGSLOGO
AP Archive: http://photoarchive.ap.org
PRN Photo Desk, photodesk@prnewswire.com
CONTACT:
Liz Bauer, SVP, Corp. Comm & IR of CSG
Systems International, Inc., +1-303-804-4065
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