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[georgie18]

NTWK... .68.. first alert @ .49...News..was looking for a break of .72 yesterday..maybe we will get it today...we are headed for a $ if it breaks...imo..maybe not today but it will come soon...

NetSol Technologies Reports 38% Sequential Quarterly Revenue Growth; Returns to Quarterly Profitability With Earnings Per Diluted Share of $0.01 for Fiscal 2012 Second-Quarter

8:31 AM ET 2/2/12 | GlobeNewswire

NetSol Technologies, Inc. (Nasdaq:NTWK), a worldwide provider of global IT and enterprise application solutions, today reported financial results for its fiscal 2012 second quarter ended December 31, 2011.

Sequential revenue growth was better than the company expected, with total second-quarter revenue increasing 38 percent to $8.6 million, from $6.2 million reported in the fiscal 2012 first quarter. Previously, the company had forecast sequential revenue growth of 15% to 20%.

"Our second-quarter results reflect a positive shift in the company's financial performance following a challenging period," said Najeeb Ghauri, chairman and CEO of NetSol. "After navigating through two tough quarters, we regained momentum by signing agreements across each of our business lines."

On a sequential basis, license revenue rose to $2.0 million in the fiscal 2012 second quarter, from $1.1 million in the fiscal 2012 first quarter, reflecting the signing of new and previously delayed contracts. License revenue was $3.1 million in the second quarter of fiscal 2011.

Maintenance revenue increased slightly to $2.1 million in the second quarter of 2012, from $2.0 million in the previous first fiscal quarter, and $2.0 million for the same period last year.

Services revenue was $4.4 million, up sequentially from $3.1 million in the first quarter of fiscal 2012, and compared with $5.3 million for the second quarter of fiscal 2011.

Fiscal 2012 Second-Quarter Highlights:

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-- Signed two new NetSol Financial Suite (NFS)(TM) projects in Asia-Pacific region, including strengthening existing agreement with Minsheng Financial Leasing; -- Completed NFS enhancement projects for two major U.S.-based auto captive finance companies, along with one of the top ten equipment leasing companies in North America; -- Initiated roll-out of next generation NFS solution with Kiatnakin Bank in Thailand; -- Embarked on automation program for a major European bank using LeaseSoft portal; -- Signed agreement with LTC Supply Source valued at approximately $1 million to implement SAP purchasing platform and smartOCI(TM) Marketplace, which includes license and ongoing services fees.

Operating expenses for the fiscal 2012 second quarter were $3.5 million, compared with $3.0 million for the fiscal 2011 second quarter. The increase primarily reflects operating expenses associated with the newly acquired subsidiary Virtual Lease Services (VLS).

Operating income for the second quarter of fiscal 2012 was $1.2 million, compared with operating income of $3.9 million in the second quarter of fiscal 2011.

Net income for the fiscal second quarter was $0.3 million, or $0.01 per diluted share, compared with net income of $1.9 million, or $0.04 per diluted share, in the second quarter of fiscal 2011.

At December 31, 2011, cash, cash equivalents amounted to $4.7 million. During the quarter, NetSol purchased 44,300 shares under the 2.5 million share purchase program at an average price of $0.44.

Financial Outlook

NetSol has improved visibility in topline revenue for the second half of fiscal 2012, as clients continue to sign orders that were deferred from the last quarter of the previous fiscal year. The company also expects to see growth in new business and revenues for its wholly owned subsidiary, Vroozi Inc., as it secures its fifth client for smartOCI.

NetSol expects sequential second half fiscal 2012 revenue growth of 10 to 15 percent when compared with the first of the same fiscal year. The company also said that it anticipates achieving profitability for the full 2012 fiscal year.

Conference Call and Webcast Information

NetSol will host a conference call today, at 9 a.m. EST to review its financial results. To participate in the conference call, please dial [phone] (domestic) or [phone] (international), password: 4509594.The call is also available through a live, listen-only audio webcast at www.netsoltech.com in the investor relations section. For those who are unable to listen to the live webcast, the call will be archived for 90 days.

Additionally, a telephone playback of the conference call will also be available until 11:59 p.m. EST, Thursday, February 9, 2012. Listeners should call [phone] (domestic) or [phone] (international) and use reservation: 4509594.

About NetSol Technologies

NetSol Technologies, Inc. (www.netsoltech.com) is a worldwide provider of global IT and enterprise application solutions that include credit and finance portfolio management systems, SAP consulting and services, custom development, systems integration, and technical services for the global Financial, Leasing, Insurance, Energy, and Technology markets. Headquartered in Calabasas, Calif., NetSol's product and services offerings have achieved ISO 9001, ISO 20000, ISO 27001, and SEI (Software Engineering Institute) CMMI (Capability Maturity Model) Maturity Level 5 assessments, a distinction shared by only 178 companies worldwide. The company's clients include Fortune 500 manufacturers, global automakers, financial institutions, utilities, technology providers, and government agencies. NetSol has delivery and support locations in San Francisco, London, Beijing, Bangkok, Lahore, Adelaide and Riyadh.

Investors can receive news releases and invitations to special events by accessing our online signup form at http://bit.ly/NetSol_Investor_Signup_Form.

The NetSol Technologies, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=9832

Forward-Looking Statements

This press release may contain forward-looking statements relating to the development of the Company's products and services and future operation results, including statements regarding the Company that are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected. The words "expects," "anticipates," variations of such words, and similar expressions, identify forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, but their absence does not mean that the statement is not forward-looking. These statements are not guarantees of future performance and are subject to certain risks, uncertainties, and assumptions that are difficult to predict. Factors that could affect the Company's actual results include the progress and costs of the development of products and services and the timing of the market acceptance. The subject Companies expressly disclaim any obligation or undertaking to update or revise any forward-looking statement contained herein to reflect any change in the company's expectations with regard thereto or any change in events, conditions or circumstances upon which any statement is based.

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NetSol Technologies, Inc. and Subsidiaries Condensed Consolidated Balance Sheets As of As of June December 31, 30, ASSETS 2011 2011 ------------- ------------- Current assets: Cash and cash equivalents $ 4,723,366 $ 4,172,802 Restricted Cash 2,703,618 5,700,000 Accounts receivable, net 12,209,500 15,062,503 Revenues in excess of billings 9,553,286 7,601,230 Other current assets 2,144,031 2,053,904 ------------- ------------- Total current assets 31,333,801 34,590,439 Property and equipment, net 16,919,342 16,014,461 Intangible assets, net 28,071,966 25,602,195 Goodwill 9,653,330 9,439,285 ------------- ------------- Total assets 85,978,439 85,646,380 ============= ============= LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable and accrued expenses 4,935,799 4,730,027 Current portion of loans and obligations under capitalized leases 4,413,779 7,062,535 Other payables 103,226 103,226 Unearned revenues 3,296,324 2,653,460 Convertible notes payable , current portion -- 2,745,524 Loans payable, bank 2,217,295 2,319,378 Common stock to be issued 125,525 400,700 ------------- ------------- Total current liabilities 15,091,948 20,014,850 Obligations under capitalized leases, less current maturities 245,139 285,472 Convertible notes payable, less current maturities 3,640,128 -- Long term loans, less current maturities 1,798,051 434,884 ------------- ------------- Total liabilities 20,775,266 20,735,206 Commitments and contingencies Stockholders' equity: Common stock, $.001 par value; 95,000,000 shares authorized; 56,948,855 & 55,531,855 issued and outstanding as of December 31, 2011 and June 30, 2011 56,949 55,532 Additional paid-in-capital 99,428,924 97,886,492 Treasury stock (415,425) (396,008) Accumulated deficit (35,271,598) (34,130,944) Stock subscription receivable (2,031,210) (2,198,460) Other comprehensive loss (9,964,572) (8,805,922) Total NetSol shareholders' equity 51,803,068 52,410,690 Non-controlling interest 13,400,105 12,500,484 Total stockholders' equity 65,203,173 64,911,174 ------------- ------------- Total liabilities and stockholders' equity $ 85,978,439 $ 85,646,380 ============= =============

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NetSol Technologies, Inc. and Subsidiaries Condensed Consolidated Statement of Operations For the Three Months For the Six Months Ended December 31, Ended December 31, 2011 2010 2011 2010 ------------ ------------ -------------- ------------ Net Revenues: License fees $ 2,047,855 $ 3,129,063 $ 3,123,705 $ 6,606,856 Maintenance fees 2,121,282 2,023,509 4,158,488 3,693,428 Services 4,436,916 5,272,675 7,552,567 8,528,035 ------------ ------------ -------------- ------------ Total revenues 8,606,052 10,425,247 14,834,760 18,828,319 Cost of revenues: Salaries and consultants 2,287,803 2,127,280 4,671,214 4,114,168 Travel 254,169 238,776 539,842 470,388 Repairs and maintenance 96,723 71,459 170,917 128,517 Insurance 31,348 31,087 67,216 62,079 Depreciation and amortization 812,510 679,284 1,601,615 1,310,225 Other 421,416 348,859 937,825 591,997 ------------ ------------ -------------- ------------ Total cost of revenues 3,903,969 3,496,745 7,988,629 6,677,375 ------------ ------------ -------------- ------------ Gross profit 4,702,083 6,928,503 6,846,131 12,150,944 Operating expenses: Selling and marketing 735,132 1,002,877 1,435,413 1,486,847 Depreciation and amortization 289,030 267,861 480,704 534,303 Bad debt expense -- (353) 192,250 254,279 Salaries and wages 1,152,023 736,898 1,958,587 1,657,162 Professional services, including non-cash compensation 236,911 151,276 423,660 290,361 Lease abandonment charges -- -- -- -- General and administrative 1,072,483 873,569 1,965,455 2,006,088 ------------ ------------ -------------- ------------ Total operating expenses 3,485,579 3,032,128 6,456,069 6,229,041 ------------ ------------ -------------- ------------ Income from operations 1,216,504 3,896,375 390,062 5,921,904 Other income and (expenses) Loss on sale of assets (1,633) (792) (3,274) (15,586) Interest expense (158,957) (291,475) (419,164) (607,119) Interest income 7,264 9,958 40,069 94,419 Gain (loss) on foreign currency exchange transactions 160,125 (400,658) 39,219 673,236 Share of net loss from equity investment -- (71,799) (100,000) (142,236) Beneficial conversion feature (61,441) (118,163) (74,247) (295,574) Other expense (8,988) (1,748) (16,706) (57,301) ------------ ------------ -------------- ------------ Total other income (expenses) (63,629) (874,677) (534,103) (350,162) ------------ ------------ -------------- ------------ Net income (loss) before income taxes 1,152,875 3,021,698 (144,041) 5,571,741 Income taxes (7,005) (3,168) (31,539) (11,724) ------------ ------------ -------------- ------------ Net income (loss) after tax 1,145,870 3,018,530 (175,580) 5,560,017 Non-controlling interest (826,303) (1,082,792) (963,561) (2,057,301) ------------ ------------ -------------- ------------ Net income (loss) attributable to NetSol 319,567 1,935,737 (1,139,141) 3,502,717 ------------ ------------ -------------- ------------ Other comprehensive loss: Translation adjustment (1,039,343) 916,065 (2,013,541) 440,163 ------------ ------------ -------------- ------------ Comprehensive income (loss) (719,776) 2,851,802 (3,152,682) 3,942,880 Comprehensive income (loss) attributable to non controlling interest (437,533) 131,912 (854,892) (74,976) ------------ ------------ -------------- ------------ Comprehensive income (loss) attributable to NetSol $ (282,243) $ 2,719,890 $ (2,297,790) $ 4,017,856 ============ ============ ============== ============ Net income per share: Basic $ 0.01 $ 0.04 $ (0.02) $ 0.08 ============ ============ ============== ============ Diluted $ 0.01 $ 0.04 $ (0.02) $ 0.08 ============ ============ ============== ============ Weighted average number of shares outstanding Basic 56,655,621 48,366,323 56,269,445 43,955,210 ============ ============ ============== ============ Diluted 57,261,550 51,058,140 56,269,445 46,647,027 ============ ============ ============== ============ Amounts attributable to NetSol common shareholders Net income / (loss) $ 319,567 $ 1,935,737 $ (1,139,141) $ 3,502,717 ------------ ------------ -------------- ------------

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NetSol Technologies, Inc. and Subsidiaries Condensed Consolidated Statement of Cash Flows For the Six Months Ended December 31, 2011 2010 ------------ ------------ Cash flows from operating activities: Net (loss) income $ (175,580) $ 5,560,017 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 2,082,319 1,844,528 Provision for bad debts 192,250 254,279 Gain on sale of subsidiary shares in Pakistan -- -- Loss on foreign currency exchange transaction -- -- Share of net loss from investment under equity method 100,000 142,236 Loss on sale of assets 3,274 15,586 (Gain) on settlement of lease abandonment provision -- -- Dividend income -- -- Non controlling interest in subsidiary 0 -- Stock issued for interest on notes payable -- 35,808 Stock issued for services 155,500 577,943 Fair market value of warrants and stock options granted 256,479 175,341 Non cash exercise of warrants -- -- Beneficial conversion feature 74,247 295,574 Amortization of capitalized finance cost -- -- Changes in operating assets and liabilities: Increase/ decrease in accounts receivable 3,322,973 (1,863,668) Increase/ decrease in other current assets (2,042,183) (1,377,332) Increase/ decrease in long-term assets -- -- Increase/ decrease in accounts payable and accrued expenses (11,801) (353,493) ------------ ------------ Net cash provided by operating activities 3,957,478 5,306,820 Cash flows from investing activities: Purchases of property and equipment (2,832,212) (2,450,222) Sales of property and equipment 73,048 19,988 Purchase of treasury stock (19,417) -- Purchase of non-controlling interest in subsidiary -- (180,000) Short-term investments held for sale -- (256,706) Investment under equity method (100,000) -- Cash brought in at acquisition -- -- Acquisition, net of cash acquired (253,192) -- Increase in intangible assets (3,713,090) (3,127,234) ------------ ------------ Net cash used in investing activities (6,844,863) (5,994,175) Cash flows from financing activities: Proceeds from sale of common stock -- 2,566,750 Proceeds from the exercise of stock options and warrants 368,000 667,300 Purchase of subsidiary stock in Pakistan -- -- Proceeds from sale of subsidiary stock -- -- Purchase of treasury stock -- -- Proceeds from convertible notes payable 4,000,000 -- Payments on convertible notes payable (2,758,330) -- Restricted cash 2,996,382 -- Dividend Paid -- -- Bank overdraft Proceeds from bank loans 3,866,758 2,588,773 Payments on bank loans -- (44,455) Payments on capital lease obligations & loans - net (5,123,981) (3,192,089) ------------ ------------ Net cash provided by financing activities 3,348,830 2,586,278 Effect of exchange rate changes in cash 89,119 (118,318) ------------ ------------ Net increase in cash and cash equivalents 550,564 1,780,605 Cash and cash equivalents, beginning of year 4,172,803 4,075,546 ------------ ------------ Cash and cash equivalents, end of year $ 4,723,366 $ 5,856,150 ============ ============

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NetSol Technologies, Inc. and Subsidiaries Reconciliation to GAAP Three Months Three Months Year Year Ended Ended To date To date December 31, December 31, December 31, December 31, 2011 2010 2011 2010 ------------ ------------ -------------- ------------ Net Income (loss) before preferred dividend, per GAAP $ 319,567 $ 1,935,737 $ (1,139,141) $ 3,502,717 Income Taxes 7,005 3,168 31,539 11,724 Depreciation and amortization 1,101,540 947,145 2,082,319 1,844,528 Interest expense 158,957 291,475 419,164 607,119 Interest (income) (7,264) (9,958) (40,069) (94,419) ------------ ------------ -------------- ------------ EBITDA $ 1,579,804 $ 3,167,567 $ 1,353,812 $ 5,871,669 ============ ============ ============== ============ Weighted Average number of shares outstanding Basic 56,655,621 48,366,323 56,269,445 43,955,210 Diluted 57,261,550 51,058,140 56,875,373 46,647,027 ------------ ------------ -------------- ------------ Basic EBITDA $ 0.03 $ 0.07 $ 0.02 $ 0.13 ============ ============ ============== ============ Diluted EBITDA $ 0.03 $ 0.06 $ 0.02 $ 0.13 ============ ============ ============== ============

This news release was distributed by GlobeNewswire, www.globenewswire.com

SOURCE: NetSol Technologies Inc.

Contacts: PondelWilkinson Inc.
Evan Pondel [phone]
[e-mail].