DOCX Document Sciences Corp (MM)

Revenues rose by 26% over the 2006 third quarter CARLSBAD, Calif., Oct. 30 /PRNewswire-FirstCall/ -- Document Sciences Corporation (NASDAQ:DOCX), a global leader in providing customer communications management solutions, today reported revenues of $10.6 million for the quarter ended September 30, 2007, an increase of 26% over revenues of $8.4 million for the quarter ended September 30, 2006. Net income for the quarter ended September 30, 2007, was $267,000 compared with net income of $115,000 for the quarter ended September 30, 2006. Net income per share for the quarter ended September 30, 2007, was $0.05 based on 5,255,933 diluted shares outstanding, compared with net income per share of $0.02, based on 5,324,126 diluted shares outstanding for the quarter ended September 30, 2006. For the nine months ended September 30, 2007, revenues were $30.0 million, compared with revenues of $24.6 million for the same period in 2006, representing an increase of 22%. For the nine months ending September 30, 2007, the company reported a net loss of $531,000, or $0.13 per share based on 4,190,406 shares outstanding, compared with a net loss of $200,000, or $0.05 per share based on 4,250,690 shares outstanding, for the nine months ending September 30, 2006. Jack McGannon, Document Sciences' President and CEO, stated that "we are pleased with the third quarter revenues, which were $2.2 million higher than the third quarter of 2006 and represented the thirteenth consecutive quarter of year-over-year revenue growth. Of note, we achieved record quarterly results for both of our revenue components, License Fees and Services & Other, each of which increased by approximately 26%. With nearly $30 million of revenue through nine months of this year, we are well on our way to achieve revenues of approximately $40 million for the year 2007 and are on track to exceed our $50 million target for 2008." McGannon added that "while we have invested significantly in Sales & Marketing to drive our growth, we again achieved positive net income in the third quarter. We have also continued to invest considerably in Research & Development to further our leadership position. During the third quarter, we announced the availability of xPression 3, the latest generation of our highly acclaimed suite of customer communications management solutions." Included in expenses for the three and nine months ended September 30, 2007 are $179,000 and $469,000, respectively, of stock-based compensation expenses, compared to $155,000 and $364,000 for the three and nine months ended September 30, 2006. About Document Sciences Document Sciences is a market-leading global provider of customer communications management solutions. Our award-winning xPression software suite enables organizations to automate the creation and delivery of well-designed, highly personalized communications -- from customized marketing collaterals, contracts and policies to high-volume relationship statements and correspondence. More than 500 content-driven organizations worldwide, including over 60 FORTUNE Global 500 companies, use Document Sciences' solutions to reduce development costs by up to 90%, improve time-to-revenue by as much as 75%, and enhance the overall customer experience with highly effective 1:1 communications. Based in Carlsbad, California, with award-winning offshore services operations in Beijing, China and offices across the U.S., in London and Sydney, Document Sciences also markets its products in Europe, Australia, Canada, New Zealand, Latin America, Asia and Africa. For more information about Document Sciences Corporation, call 888.4.DOC.SCI or visit http://www.docscience.com/. This press release may contain "forward-looking" statements about possible or assumed future results of our financial condition, operations, plans, objectives and performance. You can identify these statements by the fact that they use words such as "believe," "expect," "anticipate," "estimate," "project," "intend," "plan" or similar expressions. Many possible events or factors could affect our future financial results and performance. This could cause our results or performance to differ materially from those expressed in these forward-looking statements. Some of these events or factors include the following: (i) national, international, regional and local economic, competitive and regulatory conditions and developments; (ii) the market for dynamic content publishing software; (iii) market acceptance of enhancements to our existing products and introduction of new products; (iv) continued profitability of our professional services; (v) maintaining our relationships with Xerox Corporation and our other distribution partners and/or other risks detailed from time-to-time in our SEC reports, including the report on Form 10-K for the fiscal year ended December 31, 2006. We do not undertake, and specifically disclaim, any obligation to update forward-looking statements. DOCUMENT SCIENCES CORPORATION CONSOLIDATED BALANCE SHEETS September 30, December 31, 2007 2006 (Unaudited) ASSETS Current assets: Cash and cash equivalents $2,291,585 $5,657,380 Short-term investments 207,473 1,437,214 Accounts receivable, net 9,667,606 7,316,100 Other current assets 1,866,126 1,888,203 Total current assets 14,032,790 16,298,897 Property and equipment, net 885,227 725,029 Software development costs, net 32,196 746,282 Goodwill, net 4,794,740 4,495,192 Purchased intangible assets-net 361,333 --- Total assets $20,106,286 $22,265,400 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $703,365 $342,103 Accrued compensation 2,175,446 2,169,320 Other accrued liabilities 1,118,218 615,195 Deferred revenue 12,478,808 12,936,570 Total current liabilities 16,475,837 16,063,188 Obligations under capital leases --- 6,699 STOCKHOLDERS' EQUITY Common stock, $.001 par value 4,424 4,424 Treasury stock (3,211,202) (362,889) Additional paid-in capital 14,894,694 14,079,885 Accumulated comprehensive loss 29 302 Accumulated deficit (8,057,496) (7,526,209) Total stockholders' equity 3,630,449 6,195,513 Total liabilities and stockholders' equity $20,106,286 $22,265,400 DOCUMENT SCIENCES CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) Three Months Ended Nine Months Ended September 30, September 30, 2007 2006 2007 2006 Revenues: License fees $6,918,296 $5,509,267 $20,021,319 $16,242,752 Services and other 3,655,165 2,889,103 9,937,826 8,399,835 Total revenues 10,573,461 8,398,370 29,959,145 24,642,587 Cost of revenues: License fees 1,451,496 966,455 3,678,755 3,185,690 Services and other 2,657,540 2,471,598 7,959,218 7,462,625 Total cost of revenues 4,109,036 3,438,053 11,637, 973 10,648,315 Gross margin 6,464,425 4,960,317 18,321,172 13,994,272 Operating expenses: Research and development 1,830,961 1,590,614 5,478,870 4,356,412 Selling and marketing 3,282,895 2,313,439 9,935,266 7,030,561 General and administrative 1,098,416 975,875 3,554,812 2,944,973 Total operating expenses 6,212,272 4,879,928 18,968,948 14,331,946 Income (loss) from operations 252,153 80,389 (647,776) (337,674) Interest and other income, net 22,728 60,452 168,588 169,311 Income (loss) before income taxes 274,881 140,841 (479,188) (168,363) Provision for income taxes 7,428 25,670 52,099 31,055 Net income (loss) $267,453 $115,171 $(531,287) $(199,418) Net income (loss) per share - basic $0.07 $0.03 $(0.13) $(0.05) Weighted average shares used in basic calculation 4,000,557 4,281,906 4,190,406 4,250,690 Net income (loss) per share - diluted $0.05 $0.02 $(0.13) $(0.05) Weighted average shares used in diluted calculation 5,255,933 5,324,126 4,190,406 4,250,690 DATASOURCE: Document Sciences Corporation CONTACT: editorial, Todd Schmidt, +1-760-602-1400, , or investors, Leslie Weller, +1-760-602-1400, , both of Document Sciences Corporation Web site: http://www.docscience.com/

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