ST. LOUIS—Siboney Corporation (OTCBB: SBON— news) announced today a continuation of the significant improvements in their results of operations for the third quarter and nine month period ended September 30, 1999.
Net revenues for the third quarter ended September 30, 1999, increased 22.3% to $729,149, compared to $596,408 in the third quarter of 1998. Net income for the quarter was $108,648, an increase of 755% over a loss $16,576 reported for the third quarter of 1998.
For the nine months ended September 30, 1999, the Company reported that revenues increased 38% to $2,647,766, as compared to $1,918,734 reported for the first nine months of 1998. Net income for the nine month period increased 951% to $508,785 from $48,378 reported for the period in 1998.
The Company is engaged in the publishing and distribution of educational software, primarily to K-12 schools through its Siboney Learning Group (“SLG”) subsidiary. SLG sells software in math, reading and language arts through its GAMCO product line and its Orchard Teacher’s Choice Software product line. GAMCO products provide over 100 single-title solutions and are sold through catalog dealers and through SLG’s inside sales team. Orchard products offer schools a comprehensive integrated learning system and are sold through a network of master territorial dealers.
Sales of Orchard software continue to lead the way as this two-year old product line is enjoying an increase of over 78% for the nine-month period. This increase is fueled by schools’ growing need for comprehensive software that motivates students while providing teachers with software that manages student data and that is correlated national and state educational objectives. SLG’s current major product development project involves a major upgrade of Orchard which will provide schools with complete pre— and post-test assessment in 2000.
GAMCO dealer sales continue to increase as they are up 44% for the nine-month period thanks to strong growth in sales of products released in early 1999. Direct GAMCO sales are flat for the nine-month period as SLG is de-emphasizing the mailings of its own catalogs in light of increased success its catalog dealers are experiencing.
The Company’s selling, general and administrative expenses increased 11.7% during this nine-month period as the Company continues to invest in its accelerated product development and sales channel expansion efforts. Gross margins decreased slightly by 1.5%, due to higher royalties generated by licensed products, but remain a very healthy 85%.
Bodie Marx, President of Siboney Learning Group, commented: “If we had backed out the largest sale the company ever made during the third quarter of last year, our sales would have increased 70% during the third quarter. Very few of our competitors are enjoying this kind of success as our three-pronged sales channel strategy continues to propel our outstanding sales growth. Last year we broke a divisional sales record set in 1975. This year we broke that record on August 20th. We have obviously come a long way, but we are far from being finished.”
Tim Tegeler, Chairman and CEO of Siboney Corporation, added: “Siboney Learning Group continues to provide us with outstanding results and growth beyond our budgeted goals. We are gratified that we can report these successes to our shareholders. We look forward to completing a very successful year in terms of revenues and profitability.”
| Nine Months Ended September 30 | Three Months Ended September 30 | |||
|---|---|---|---|---|
| 1999 | 1998 | 1999 | 1998 | |
| Revenues | $ 2,647,766 | 1,918,734 | 729,149 | 596,408 |
| Cost of Product Sales | $ 401,287 | 260,708 | 111,345 | 84,469 |
| Selling, General, & Admin. Expenses | $ 1,775,524 | 1,589,080 | 586,822 | 522,289 |
| Income from Operations | $ 470,955 | 68,946 | 30,982 | (10,350) |
| Other Income (Expenses) | $ 37,830 | (20,568) | 77,666 | (6,226) |
| Net Income | $ 508,785 | 48,378 | 108,648 | (16,576) |
| Weighted Average Shares Outstanding | 16,525,344 | 16,518,344 | 16,525,344 | 16,518,344 |
| Income per share | $ .031 | $ .003 | $ .007 | ($ .001) |
Contact:
Siboney Corporation, St. Louis
Bodie Marx, 314/909-1670 x110
Any forward-looking statement is necessarily subject to significant uncertainties and risks. The words “believes”, “anticipates”, “intends”, “expects” and similar expressions are intended to identify forward-looking statements. Actual results could be materially different due to various factors, including the level of education funding provided by federal and state governments, regulatory developments, product development and pricing strategies undertaken by our competitors and our ability to attract and retain key personnel. The Company undertakes no obligation to publicly release the results of any revisions to these forward-looking statements which may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.