TeleCommunication Systems Inc. (TSYS) filed Quarterly Report for the period ended 2009-09-30.
TeleCommunication Systems Inc. provides wireless network application software and services and communications engineering services. The company's communications engineering services include network design installation and operation network engineering and analysis and complex program management. Through its experience the company recognized the demand for network application software that provides for the delivery of Internet content short messages and enhanced data communications services to wireless devices including phones two-way pagers. Telecommunication Systems Inc. has a market cap of $431.1 million; its shares were traded at around $9.03 with a P/E ratio of 21 and P/S ratio of 2. Telecommunication Systems Inc. had an annual average earning growth of 40.7% over the past 5 years.
Highlight of Business Operations:
Commercial services revenue in the three- and nine-months ended September 30, 2009 was $7.9 million and $14.3 million higher, respectively, than the same periods for 2008 from increased subscriber revenue for LBS applications, service connection deployments of our E9-1-1 services for cellular and VoIP service providers, and an increase in software maintenance revenue, as well as about $4 and $6 million, respectively, for the three- and nine-months ended September 30, 2009, of additional subscriber service revenue under former LocationLogic customer contracts following the May 2009 acquisition of that business.
The direct cost of commercial services revenue consists primarily of compensation and benefits, network access, data feed and circuit costs, and equipment and software maintenance. The direct cost of maintenance revenue consists primarily of compensation and benefits expense. For the three- and nine-months ended September 30, 2009, the direct cost of services revenue was $0.7 million and $1.3 million higher, respectively, than the three- and nine-months ended September 30, 2008 primarily due to increase in labor and other direct costs related to the operations of the LocationLogic business. We also incurred an increase in labor and direct costs related to custom development efforts responding to customer requests and deployment requirements for VoIP. For both the three- and nine-months ended September 30, 2009, the cost of circuits and other data access costs accounted for approximately 12% of total direct costs of
The direct cost of our commercial systems consists primarily of compensation and benefits, purchased equipment, third-party hardware and software, travel expenses, consulting fees as well as the amortization of both acquired and capitalized software development costs for all reported periods. The direct cost of the license component of systems is normally very low, and the gross profit very high since the software development efforts were expensed in prior periods. During the three- and nine-months ended September 30, 2009, direct costs of systems included $0.8 million and $2.1 million, respectively, of amortization of software development costs. In the three- and nine-months ended September 30, 2008, the composition of the direct cost of our systems was about the same except for $0.6 million and $1.5 million, respectively, of amortization of software development costs. The decrease in the direct costs of systems in the three- and nine-months ended September 30, 2009 is due to the absence of a comparable hardware project during the same periods in 2008.
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