BEIJING, Jan. 9 /PRNewswire-Asia-FirstCall/ -- Yucheng Technologies Limited (Nasdaq: YTEC), a leading provider of IT solutions and services to China's banking industry, today updated its annual guidance for 2008.
Due to forecasted changes in bank spending patterns that have not materialized, Yucheng's expectations for 2008 have changed. Revenues are now expected to be between USD 99M and USD 103M, an increase of approximately 70% compared to 2007. Our gross and net margins are a result of our product mix, which skewed more heavily towards System Integration than expected in the last six weeks of the fourth quarter 2008. As a result of the product mix in the fourth quarter 2008, net income expectations have been revised to USD 13.2M to USD 13.5M, an increase of approximately 25% compared to 2007. The revised 2008 estimates raise revenue and lower net income from our previous guidance, issued November 17, 2008.
Management anticipates that the cash position as of year-end in will be in excess of USD 30M.
"Due to the global financial crisis, our larger bank customers became more conservative in the fourth quarter and have not spent as aggressively on new software and solutions as anticipated," said Weidong Hong, CEO of Yucheng. "By contrast, many small to medium-sized banks invested more heavily in hardware projects that will serve as the foundation for future IT Solution and Services projects across our three product lines. Looking towards 2009, we expect that continuing macroeconomic trends will temper the rate of IT spending. Therefore, we are planning our business based on top line and bottom line growth of 18-23%."
Yucheng and its auditor are in the process of reviewing and auditing its fourth quarter results, and will provide complete results in the next quarterly earnings release, scheduled for February 12, 2009.
Cautionary Statement
This document contains estimates of the company's preliminary fourth quarter financial results. The company is continuing to review its financial and operating results, and actual results may differ materially from those contained herein. Financial results could vary from the estimates above based on the final accounting treatment.
About Yucheng Technologies Limited
Yucheng Technologies Limited (NASDAQ: YTEC) is a leading IT service provider to the Chinese banking industry. Headquartered in Beijing, China, Yucheng has approximately 2,000 employees and has established an extensive network for serving its banking clients nationwide, with subsidiaries and representative offices in 23 cities. Yucheng provides a comprehensive suite of IT solutions and services to Chinese banks including: (i) Channel Solutions, such as web banking and call centers; (ii) Business Solutions, such as core banking systems, foreign exchange and treasury management; and (iii) Management Solutions, such as risk analytics and business intelligence. Yucheng is also a leading third-party provider of POS merchant acquiring services in partnership with banks in China.
Safe Harbor Statement
This press release includes forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties. Forward-looking statements are statements that are not historical facts. Forward-looking statements generally can be identified by the use of forward-looking terminology, such as ''may,'' "will," "expect," "intend," "estimate," "anticipate," "believe," "project" or "continue" or the negative thereof or other similar words. Such
forward-looking statements, based upon the current beliefs and expectations of Yucheng's management, are subject to risks and uncertainties, which could cause actual results to differ from the forward looking statements. The following factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: current dependence on the PRC banking industry demand for the products and services of Yucheng; competition from other service providers in the PRC and international consulting firms; the ability to update and expand product and service offerings; retention and hiring of qualified employees; protection of intellectual property; creating and maintaining quality product offerings; operating a business in the PRC with its changing economic and regulatory environment; and the other relevant risks detailed in Yucheng filings with the Securities and Exchange Commission. The information set forth herein should be read in light of such risks. Yucheng assumes no obligation to update the information contained in this press release.
For further information, please contact:
New York:
Mr. Jim Preissler
Tel: +1-646-383-4832
Email: jpreissler@yuchengtech.com
Beijing:
Ms. Rebecca Alexander
Tel: +1-914-613-3648 / +86-10-5913-7998
Email: ralexander@yuchengtech.com
