Daily Journal Corporation Announces Financial Results for Fiscal Year ended September 30, 2014
January 28, 2015 at 17:00 PM EST
LOS ANGELES, Jan. 28, 2015 (GLOBE NEWSWIRE) -- During the fiscal year ended September 30, 2014, Daily Journal Corporation (Nasdaq:DJCO) had a consolidated pretax income of $141,000 as compared to $4,569,000 in the prior year. This was a decrease in profits of $4,428,000 that included decreases of $2,825,000 in trustee sale notice and related service fee revenues and $3,001,000 of additional amortizations of intangible acquisition costs. (Effective October 1, 2014, the Company's three wholly-owned technology-related subsidiaries -- Sustain Technologies, Inc., New Dawn Technologies, Inc. and ISD Technologies, Inc. -- merged to become one wholly-owned subsidiary, Journal Technologies, Inc.)
Consolidated revenues were $43,423,000 and $37,676,000 for fiscal 2014 and 2013, respectively. This increase of $5,747,000 (15%) was primarily from the additional Journal Technologies' revenues of $9,304,000, partially offset by the reduction in trustee sale notice and related service fee revenues of $2,825,000 and the additional interest and penalty expenses of $537,000 accrued for uncertain and unrecognized tax benefits relating to one of the Company's acquisitions in fiscal 2013.
The Company's traditional business segment pretax income decreased by $2,817,000 (32%) to $5,890,000 from $8,707,000, primarily resulting from the reduction in trustee sale notice and related service fee revenues. The Company's Journal Technologies segment had a pretax loss of $5,749,000 after the additional accrual of interest and penalty expenses of $537,000 for uncertain and unrecognized tax benefits mentioned above compared to $4,138,000 in the prior year. The expenses in fiscal 2014 included $4,866,000 of intangible amortization expenses related to the Company's two recent acquisitions as compared with $1,865,000 of intangible amortization expenses in the prior year as one of the acquisitions occurred in September 2013.
The Company recorded an income tax benefit of $490,000 on its pretax income of $141,000 in fiscal 2014. On pretax income of $4,569,000 for fiscal 2013, the Company recorded a tax provision of $790,000. At September 30, 2014, the Company accrued a liability of approximately $3,244,000 for the uncertain and unrecognized tax benefits relating to an acquisition in fiscal 2013. (The Company's consolidated financial statements at June 30, 2014 were restated to record this liability.)
At September 30, 2014, the Company held marketable securities valued at $173,676,000, including unrealized gains of $125,700,000. It accrued a liability of $48,896,000 for income taxes due only upon the sales of the net appreciated securities.
Comprehensive income includes net income and unrealized net gains on investments, net of taxes, as summarized below:
Certain financial information for the Company's reportable segments is summarized below:
Daily Journal Corporation publishes newspapers and web sites covering California and Arizona, as well as the California Lawyer magazine, and produces several specialized information services. Journal Technologies, Inc. is a wholly-owned subsidiary and supplies case management software systems and related products to courts and other justice agencies.
Daily Journal Corporation's amended Form 10-Q/A for the third quarter ended June 30, 2014 of fiscal 2014 and Form 10-K for fiscal year ended September 30, 2014 are expected to be filed electronically with the Securities and Exchange Commission today. We invite your attention to the Form 10-K which contains our consolidated financial statements, management's discussion and analysis of financial condition and results of operations and other information.
This press release includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Certain statements contained in this press release are "forward-looking" statements that involve risks and uncertainties that may cause actual future events or results to differ materially from those described in the forward-looking statements. Words such as "expects," "intends," "anticipates," "should," "believes," "will," "plans," "estimates," "may," variations of such words and similar expressions are intended to identify such forward-looking statements. We disclaim any intention or obligation to revise any forward-looking statements whether as a result of new information, future developments, or otherwise. Although we believe that the expectations reflected in such forward-looking statements are reasonable, we can give no assurance that such expectations will prove to have been correct. Additional information concerning factors that could cause actual results to differ materially from those in the forward-looking statements is contained from time to time in documents we file with the Securities and Exchange Commission, including the Annual Report on Form 10-K we expect to file today for the fiscal year ended September 30, 2014.
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