Group 1 Software today reported record results for its second fiscal quarter ended September 30, 2003. The company reported second quarter net income of $2.6 million, a 30% increase over the prior year. Fully diluted earnings per share in the second quarter, also a record, were $0.16 vs. $0.14 the prior year, despite a substantially higher diluted share count. The company reported record second quarter revenue of $25.2 million, compared with $25.0 million the prior year. Second quarter license fee revenue for the company was $10.8 million, compared with $11.3 million reported the prior year. Total revenue for the quarter from Enterprise Solutions software and services was $17.8 million compared with $16.9 million in the prior year's second quarter. License fees in the Enterprise Solutions division were $8.5 million, up from $7.8 million reported the prior year. The Enterprise Solutions division's performance was solid across its entire range of products. Total revenue from DOC1 Customer Communications Management software and services was $7.4 million compared with $8.1 million in the prior year's second quarter. License fees in the DOC1 division were $2.3 million compared with $3.5 million reported the prior year. New license fee revenue in the DOC1 division continues to be impacted by the current economic environment. Sales of new DOC1 systems are most often a replacement of existing technologies. Consequently, many companies with tight IT budgets have postponed these purchases. For the first six months of the fiscal year, the company reported revenue of $49.5 million, up from $48.4 million in the same period of the prior year. Net income for the six months was $4.6 million, an increase of 58% over net income of $2.9 million the prior year. Fully diluted earnings per share were $0.29 vs. $0.21, an increase of 38% over the prior year. Operating income for the six months totaled $3.4 million, up 10% over the prior year. Non-operating income totaled $512,000, compared with $115,000 the prior year. The increase in non-operating income was primarily due to interest income recognized on the bridge loan to Sagent Technology prior to the asset acquisition by Group 1 on October 1, 2003. Group 1's cash position remained strong. Cash and short-term investments totaled $57.9 million at September 30, 2003, compared with $57.8 million at June 30, 2003. "Although sales in the DOC1 division were below our expectations, we were pleased that we were able to achieve record net earnings and revenue for the company," said Bob Bowen, CEO of Group 1 Software. "Looking ahead, we continue to be excited about our business prospects. The market's early response to the Sagent data integration and business geographics capabilities has been positive. With the Sagent acquisition, we are now truly a global company, with distribution capabilities in Japan, South Korea, China and other areas of Southeast Asia, in addition to our existing presence in the Americas and Europe." "Within the DOC1 division, we are very optimistic about the just-announced DOC1 Series 5," continued Bowen. "This groundbreaking technology represents a dramatic move forward for Group 1 and we believe this major new release can become a catalyst for new business in coming quarters." "We remain confident in our fiscal year guidance," said Mark Funston, CFO of Group 1 Software. "Our guidance for the six month period ending March 31, 2004 is for revenue growth in the range of 31% to 33% and net earnings growth (excluding non-recurring costs) in the range of 5% to 10% over fiscal year 2003. Our guidance incorporates the anticipated $1.0 million in amortization of purchased intangibles from the Sagent acquisition. Net earnings growth for the six month period before the amortization of purchased intangibles is projected to be in the range of 16% to 21% over fiscal year 2003."