477,010 470,557

Treasury stock, at cost; 36,275 and 35,980 shares ) )

(907,601 (894,126

Accumulated other comprehensive income (loss):

Unrealized gains on short-term investments, net of tax - 13

Cumulative foreign currency translation adjustments ) )

(29,294 (31,151

Accumulated earnings

898,961 876,402

Total stockholders' equity

439,780 422,395

$ $

Total liabilities and stockholders' equity

1,291,684 1,332,000

CSG SYSTEMS INTERNATIONAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME-UNAUDITED

(in thousands, except per share amounts)

Quarter Ended Six Months Ended

June 30, June 30, June 30, June 30,

2021 2020 2021 2020

$ $ $ $

Revenue

255,134 240,321 508,253 485,938

Cost of revenue (exclusive of depreciation, shown separately 132,938 138,153 266,480 269,359 below)

Other operating expenses:

Research and development

32,754 29,263 64,966 59,600

Selling, general and administrative 49,250 44,999 98,065 89,383

Depreciation

6,266 5,634 12,379 11,199

Restructuring and reorganization charges 1,760 2,497 2,820 3,463

Total operating expenses

222,968 220,546 444,710 433,004

Operating income

32,166 19,775 63,543 52,934

Other income (expense):

Interest expense ) ) ) )

(3,633 (4,040 (7,225 (8,253

Amortization of original issue (784 ) (740 ) ) ) discount (1,556 (1,470

Interest and investment income, 84 303 208 832 net

Other, net (100 ) ) (655 ) )

(1,048 (1,117

Total other ) ) ) )

(4,433 (5,525 (9,228 (10,008

Income before income taxes

27,733 14,250 54,315 42,926

Income tax provision ) ) ) )

(8,412 (3,884 (15,363 (11,046

$ $ $ $

Net income

19,321 10,366 38,952 31,880

Weighted-average shares outstanding:

Basic

31,875 32,100 31,859 32,047

Diluted

31,993 32,258 32,070 32,308

Earnings per common share:

$ $ $ $

Basic

0.61 0.32 1.22 0.99

Diluted 0.60 0.32 1.21 0.99

CSG SYSTEMS INTERNATIONAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS-UNAUDITED

(in thousands)

Six Months Ended

June 30, June 30,

2021 2020

Cash flows from operating activities^(1):

$ $

Net income

38,952 31,880

Adjustments to reconcile net income to net cash provided by operating activities-

Depreciation 12,379 11,199

Amortization 22,018 22,043

Amortization of original issue discount 1,556 1,470

Asset impairment 415 10,595

(Gain)/loss on short-term investments 32 (110 )

Deferred income taxes 6,434 6,771

Stock-based compensation 10,417 10,112

Subtotal 92,203 93,960

Changes in operating assets and liabilities, net of acquired amounts:

Trade accounts receivable, net 1,128 (6,286 )

Other current and non-current assets and liabilities (7,623 ) (8,568 )

Income taxes payable/receivable ) 1,332

(11,620

Trade accounts payable and accrued liabilities ) )

(29,817 (36,381

Deferred revenue.. (2,042 ) 6,803

Net cash provided by operating activities 42,229 50,860

Cash flows from investing activities:

Purchases of software, property and equipment ) )

(15,158 (14,334

Purchases of short-term investments ) )

(46,195 (35,112

Proceeds from sale/maturity of short-term investments 49,419 34,185

Acquisition of and investments in business, net of cash acquired ) (9,991 )

(12,097

Net cash used in investing activities ) )

(24,031 (25,252

Cash flows from financing activities^(1):

Proceeds from issuance of common stock 1,335 1,247

Payment of cash dividends ) )

(16,654 (15,856

Repurchase of common stock ) )

(18,792 (14,515

Payments on long-term debt (6,563 ) (4,687 )

Settlement and merchant reserve activity ) )

(23,967 (28,745

Net cash used in financing activities ) )

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