Renaissance Learning Announces First Quarter Financial Results; Revenues Up 25%, Earnings Up 29% Over First Quarter 2000

Apr 16, 2001, 01:00 ET from Advantage Learning Systems DBA Renaissance Learning, Inc.

    WISCONSIN RAPIDS, Wis., April 16 /PRNewswire/ --
     Advantage Learning Systems, Inc., (Nasdaq: ALSI), doing business as
 Renaissance Learning, Inc., a leading provider of learning information systems
 to the K-12 market, today announced financial results for the quarter ending
 March 31, 2001.  Revenues for the quarter were $30.2 million, highest in the
 Company's history and an increase of 25% over first quarter 2000 revenues of
 $24.1 million.  Net income for the quarter was $5.2 million compared to net
 income of $4.0 million for the first quarter 2000, an increase of 29%.
 Earnings per share for the quarter were $0.15, compared to $0.12 per share for
 first quarter 2000.
     (PHOTO:  http://www.newscom.com/cgi-bin/prnh/20001108/RENAISSANCELOGO )
     "The quarter delivered strong, profitable growth as we expected," said
 Michael Baum, Chief Executive Officer of Renaissance Learning.  "In product
 sales, repeat orders from existing customers generated the majority of
 revenues, as usual in a first quarter.  New-school adoptions of core math and
 reading products have begun to build, and are expected to continue gaining
 momentum in the second and third quarters.  In services, margins and revenue
 growth were constrained as expected by the timing and location of our national
 conference, which were not as favorable as last year.  Nonetheless, the
 conference was a huge success, with over 5,000 paying attendees flocking to
 see our new products and services, and to start planning to bring them to
 their schools."
     The Company continues to invest aggressively in new-product development.
 Two key products are scheduled for release in the second quarter:
     -- STAR Early Literacy(TM), a revolutionary diagnostic test for phonics
        and other key early language skills, supporting the current emphasis on
        improving early reading instruction
     -- AR Universal(TM), the new version of the industry-leading Accelerated
        Reader(R) reading management program, which will support new
        recorded-voice versions of quizzes on literature books for emergent
        readers, plus improved administration of Reading Instruction quizzes on
        major reading textbooks and other instructional materials
 
     Also expected to contribute to sales growth in the next quarter are new
 Accelerated Math(R) subject libraries such as those recently developed to
 support California state standards, and math Learning Cards(TM), instructional
 aids to help teachers intervene with students struggling to master individual
 math objectives, which were unveiled at the national conference.  Development
 continues on other products for later release including eSchoolOffice(TM)
 Web-based school administration software, which is in preparation for piloting
 in a Canadian school this spring.
     "We expect continued robust growth in the second quarter, as schools enter
 the prime period of their annual purchasing cycle, especially for the adoption
 of new products," said Baum.  "In addition to new products, we are expecting
 significant growth to come from both new and existing schools in math.
 Overall, 2001 is shaping up as we anticipated, and we continue confident that
 we can maintain the annual growth rate we achieved in 2000, while sustaining
 overall margins."
     During the first quarter, the Company added about 900 new customer schools
 in the U.S. and Canada, bringing total North American customers to over
 55,000.  Over 53,000 of these use the Company's reading software products;
 about 12,000 use math.  Several school districts also signed new contracts for
 Renaissance Schoolwide school improvement programs, which include sales of
 software, training, and consulting services.  The Company continues to devote
 sales and marketing resources to growing Renaissance Schoolwide, which is seen
 as key to resuming growth in its training business.
     The Company expects its stock trading symbol on The Nasdaq Stock Market to
 change April 20 to RLRN to reflect the legal change of its name to Renaissance
 Learning, Inc.  The name change, which was previously announced last September
 and is expected to be approved by shareholders at the Company's annual meeting
 April 18, is designed to bring all the Company's products and services under a
 single brand umbrella and to emphasize the Company's focus on comprehensive
 school improvement.
     Renaissance Learning, Inc., is a leading provider of comprehensive school
 improvement, through research-based software products, teacher training, and
 consulting.  The Company's software products, called learning information
 systems, give students and teachers continuous constructive feedback that
 helps motivate students, dramatically accelerate learning, improve test
 scores, and help students master all standards, while reducing teacher
 paperwork.  Adopted by more than 55,000 schools, these software products are
 among the most popular in schools nationwide, including Accelerated Reader(R),
 Accelerated Math(R), STAR Reading(R), STAR Math(R), PerfectCopy(TM), and
 others.  The Company's Renaissance Schoolwide process has been adopted by
 school districts across the country, and about 300,000 pre-K-12 educators have
 received Renaissance training.  The Company also provides electronic
 assessment products and services to educational publishers, and sells
 enterprise software for training and knowledge management.  The Company has
 six US locations and subsidiaries in Australia, Canada, India, and the United
 Kingdom.
     The Company will hold a conference call at 4:00 p.m. CDST today to discuss
 its financial results, quarterly highlights, and business outlook.  The
 teleconference may be accessed in listen-only mode by dialing 800-553-0358 at
 4:00 p.m. CDST.  Please call a few minutes before the scheduled start time to
 ensure a proper connection.  A digital recording of the conference call will
 be made available on April 16, 2001 at 8:00 p.m. through April 23, 2001 at
 11:59 p.m. CDST.  The replay dial-in is 800-475-6701.  The conference ID
 number to access the replay is 580118.
     This press release contains forward-looking statements made pursuant to
 the safe harbor provision of the Private Securities Litigation Reform Act of
 1995, including statements regarding future financial and operating results,
 and the introduction of new products and services.  Any such forward-looking
 statements may involve risk and uncertainties that could cause actual results
 to differ materially from any future results encompassed within the
 forward-looking statements.  Factors that could cause or contribute to such
 differences include those matters disclosed in the Company's Annual Report on
 Form 10-K and the Company's other Securities and Exchange Commission filings
 which factors are incorporated herein by reference.
 
 
                        ADVANTAGE LEARNING SYSTEMS, INC.
                         DBA Renaissance Learning, Inc.
                       CONSOLIDATED STATEMENTS OF INCOME
            (dollar amounts in thousands, except per share amounts)
                                  (unaudited)
 
                                                             Three Months
                                                            Ended March 31,
                                                          2001           2000
     Net sales:
       Products                                         $24,362        $18,372
       Services                                           5,819          5,698
         Total net sales                                 30,181         24,070
 
     Cost of sales:
       Products                                           3,297          2,517
       Services                                           3,674          3,049
         Total cost of sales                              6,971          5,566
 
     Gross profit                                        23,210         18,504
 
     Operating expenses:
       Product development                                4,392          3,170
       Selling and marketing                              7,992          6,633
       General and administrative                         3,414          2,833
         Total operating expenses                        15,798         12,636
 
     Operating income                                     7,412          5,868
 
     Other income (expense), net                            989            721
 
     Income before taxes                                  8,401          6,589
 
     Income taxes                                         3,234          2,591
 
     Net income                                          $5,167         $3,998
 
     Earnings per share:
       Basic                                              $0.15          $0.12
       Diluted                                            $0.15          $0.12
 
     Weighted average shares outstanding:
       Basic                                         34,430,922     34,220,824
       Diluted                                       34,764,487     34,339,496
 
 
                        ADVANTAGE LEARNING SYSTEMS, INC.
                         DBA Renaissance Learning, Inc.
                          CONSOLIDATED BALANCE SHEETS
                         (dollar amounts in thousands)
 
 
                                                     March 31,    December 31,
                                                       2001           2000
                                                    (unaudited)
                     ASSETS:
     Current assets:
     Cash and cash equivalents                        $33,019        $24,963
     Investment securities                             44,239         43,880
     Accounts receivable, net                          12,311         11,335
     Inventories                                        1,607          1,523
     Prepaid expenses                                   1,412          1,204
     Deferred tax asset                                 2,897          2,922
       Total current assets                            95,485         85,827
 
     Property, plant and equipment, net                24,195         24,501
     Deferred tax asset                                 2,002          2,127
     Other assets                                       5,734          5,766
 
       Total assets                                  $127,416       $118,221
 
 
     LIABILITIES AND SHAREHOLDERS' EQUITY:
     Current liabilities:
     Accounts payable                                  $2,870         $2,166
     Deferred revenue                                   5,147          5,484
     Payroll and employee benefits                      3,093          2,813
     Income taxes payable                               3,704          2,419
     Other current liabilities                          3,655          4,104
       Total current liabilities                       18,469         16,986
     Deferred revenue                                   1,227          1,380
       Total liabilities                               19,696         18,366
 
       Minority interest                                  182            185
 
       Total shareholders' equity                     107,538         99,670
 
       Total liabilities and shareholders' equity    $127,416       $118,221
 
 

SOURCE Advantage Learning Systems DBA Renaissance Learning, Inc.
    WISCONSIN RAPIDS, Wis., April 16 /PRNewswire/ --
     Advantage Learning Systems, Inc., (Nasdaq: ALSI), doing business as
 Renaissance Learning, Inc., a leading provider of learning information systems
 to the K-12 market, today announced financial results for the quarter ending
 March 31, 2001.  Revenues for the quarter were $30.2 million, highest in the
 Company's history and an increase of 25% over first quarter 2000 revenues of
 $24.1 million.  Net income for the quarter was $5.2 million compared to net
 income of $4.0 million for the first quarter 2000, an increase of 29%.
 Earnings per share for the quarter were $0.15, compared to $0.12 per share for
 first quarter 2000.
     (PHOTO:  http://www.newscom.com/cgi-bin/prnh/20001108/RENAISSANCELOGO )
     "The quarter delivered strong, profitable growth as we expected," said
 Michael Baum, Chief Executive Officer of Renaissance Learning.  "In product
 sales, repeat orders from existing customers generated the majority of
 revenues, as usual in a first quarter.  New-school adoptions of core math and
 reading products have begun to build, and are expected to continue gaining
 momentum in the second and third quarters.  In services, margins and revenue
 growth were constrained as expected by the timing and location of our national
 conference, which were not as favorable as last year.  Nonetheless, the
 conference was a huge success, with over 5,000 paying attendees flocking to
 see our new products and services, and to start planning to bring them to
 their schools."
     The Company continues to invest aggressively in new-product development.
 Two key products are scheduled for release in the second quarter:
     -- STAR Early Literacy(TM), a revolutionary diagnostic test for phonics
        and other key early language skills, supporting the current emphasis on
        improving early reading instruction
     -- AR Universal(TM), the new version of the industry-leading Accelerated
        Reader(R) reading management program, which will support new
        recorded-voice versions of quizzes on literature books for emergent
        readers, plus improved administration of Reading Instruction quizzes on
        major reading textbooks and other instructional materials
 
     Also expected to contribute to sales growth in the next quarter are new
 Accelerated Math(R) subject libraries such as those recently developed to
 support California state standards, and math Learning Cards(TM), instructional
 aids to help teachers intervene with students struggling to master individual
 math objectives, which were unveiled at the national conference.  Development
 continues on other products for later release including eSchoolOffice(TM)
 Web-based school administration software, which is in preparation for piloting
 in a Canadian school this spring.
     "We expect continued robust growth in the second quarter, as schools enter
 the prime period of their annual purchasing cycle, especially for the adoption
 of new products," said Baum.  "In addition to new products, we are expecting
 significant growth to come from both new and existing schools in math.
 Overall, 2001 is shaping up as we anticipated, and we continue confident that
 we can maintain the annual growth rate we achieved in 2000, while sustaining
 overall margins."
     During the first quarter, the Company added about 900 new customer schools
 in the U.S. and Canada, bringing total North American customers to over
 55,000.  Over 53,000 of these use the Company's reading software products;
 about 12,000 use math.  Several school districts also signed new contracts for
 Renaissance Schoolwide school improvement programs, which include sales of
 software, training, and consulting services.  The Company continues to devote
 sales and marketing resources to growing Renaissance Schoolwide, which is seen
 as key to resuming growth in its training business.
     The Company expects its stock trading symbol on The Nasdaq Stock Market to
 change April 20 to RLRN to reflect the legal change of its name to Renaissance
 Learning, Inc.  The name change, which was previously announced last September
 and is expected to be approved by shareholders at the Company's annual meeting
 April 18, is designed to bring all the Company's products and services under a
 single brand umbrella and to emphasize the Company's focus on comprehensive
 school improvement.
     Renaissance Learning, Inc., is a leading provider of comprehensive school
 improvement, through research-based software products, teacher training, and
 consulting.  The Company's software products, called learning information
 systems, give students and teachers continuous constructive feedback that
 helps motivate students, dramatically accelerate learning, improve test
 scores, and help students master all standards, while reducing teacher
 paperwork.  Adopted by more than 55,000 schools, these software products are
 among the most popular in schools nationwide, including Accelerated Reader(R),
 Accelerated Math(R), STAR Reading(R), STAR Math(R), PerfectCopy(TM), and
 others.  The Company's Renaissance Schoolwide process has been adopted by
 school districts across the country, and about 300,000 pre-K-12 educators have
 received Renaissance training.  The Company also provides electronic
 assessment products and services to educational publishers, and sells
 enterprise software for training and knowledge management.  The Company has
 six US locations and subsidiaries in Australia, Canada, India, and the United
 Kingdom.
     The Company will hold a conference call at 4:00 p.m. CDST today to discuss
 its financial results, quarterly highlights, and business outlook.  The
 teleconference may be accessed in listen-only mode by dialing 800-553-0358 at
 4:00 p.m. CDST.  Please call a few minutes before the scheduled start time to
 ensure a proper connection.  A digital recording of the conference call will
 be made available on April 16, 2001 at 8:00 p.m. through April 23, 2001 at
 11:59 p.m. CDST.  The replay dial-in is 800-475-6701.  The conference ID
 number to access the replay is 580118.
     This press release contains forward-looking statements made pursuant to
 the safe harbor provision of the Private Securities Litigation Reform Act of
 1995, including statements regarding future financial and operating results,
 and the introduction of new products and services.  Any such forward-looking
 statements may involve risk and uncertainties that could cause actual results
 to differ materially from any future results encompassed within the
 forward-looking statements.  Factors that could cause or contribute to such
 differences include those matters disclosed in the Company's Annual Report on
 Form 10-K and the Company's other Securities and Exchange Commission filings
 which factors are incorporated herein by reference.
 
 
                        ADVANTAGE LEARNING SYSTEMS, INC.
                         DBA Renaissance Learning, Inc.
                       CONSOLIDATED STATEMENTS OF INCOME
            (dollar amounts in thousands, except per share amounts)
                                  (unaudited)
 
                                                             Three Months
                                                            Ended March 31,
                                                          2001           2000
     Net sales:
       Products                                         $24,362        $18,372
       Services                                           5,819          5,698
         Total net sales                                 30,181         24,070
 
     Cost of sales:
       Products                                           3,297          2,517
       Services                                           3,674          3,049
         Total cost of sales                              6,971          5,566
 
     Gross profit                                        23,210         18,504
 
     Operating expenses:
       Product development                                4,392          3,170
       Selling and marketing                              7,992          6,633
       General and administrative                         3,414          2,833
         Total operating expenses                        15,798         12,636
 
     Operating income                                     7,412          5,868
 
     Other income (expense), net                            989            721
 
     Income before taxes                                  8,401          6,589
 
     Income taxes                                         3,234          2,591
 
     Net income                                          $5,167         $3,998
 
     Earnings per share:
       Basic                                              $0.15          $0.12
       Diluted                                            $0.15          $0.12
 
     Weighted average shares outstanding:
       Basic                                         34,430,922     34,220,824
       Diluted                                       34,764,487     34,339,496
 
 
                        ADVANTAGE LEARNING SYSTEMS, INC.
                         DBA Renaissance Learning, Inc.
                          CONSOLIDATED BALANCE SHEETS
                         (dollar amounts in thousands)
 
 
                                                     March 31,    December 31,
                                                       2001           2000
                                                    (unaudited)
                     ASSETS:
     Current assets:
     Cash and cash equivalents                        $33,019        $24,963
     Investment securities                             44,239         43,880
     Accounts receivable, net                          12,311         11,335
     Inventories                                        1,607          1,523
     Prepaid expenses                                   1,412          1,204
     Deferred tax asset                                 2,897          2,922
       Total current assets                            95,485         85,827
 
     Property, plant and equipment, net                24,195         24,501
     Deferred tax asset                                 2,002          2,127
     Other assets                                       5,734          5,766
 
       Total assets                                  $127,416       $118,221
 
 
     LIABILITIES AND SHAREHOLDERS' EQUITY:
     Current liabilities:
     Accounts payable                                  $2,870         $2,166
     Deferred revenue                                   5,147          5,484
     Payroll and employee benefits                      3,093          2,813
     Income taxes payable                               3,704          2,419
     Other current liabilities                          3,655          4,104
       Total current liabilities                       18,469         16,986
     Deferred revenue                                   1,227          1,380
       Total liabilities                               19,696         18,366
 
       Minority interest                                  182            185
 
       Total shareholders' equity                     107,538         99,670
 
       Total liabilities and shareholders' equity    $127,416       $118,221
 
 SOURCE  Advantage Learning Systems DBA Renaissance Learning, Inc.

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http://www.advlearn.com