Crystal Systems inches into black for second quarter with $26K net

Crystal Systems Solutions (Nasdaq:CRYS), which provides software and support to modernize legacy information systems, showed shrinking losses for the first half of the year.

The company today said second-quarter revenues sank 7% from the first quarter to $7.5 million.

Gross profit margins for the second quarter of 2002 were 61%, compared to 60% for the first quarter of 2002.

Crystal reported netting $26,000, versus losing a net $238,000 for the first quarter of 2002.

The increased gross profit margins compared to the same period last year were largely due to the company's focus on license sales and fixed price projects, and a significantly reduced expense structure, it said.

For the first half, revenues were $15.6 million, compared to $21.2 million for the first six months of 2001.

Gross profit margins for the first half of 2002 were 61%, compared to 52% for the first six months of 2001.

Crystal reported losing a net $210K for the first half, or 2 cents per share, versus losing $6.3 million or 83 cents per share in the parallel half.

"Revenues for the second quarter were impacted by the continuing cautious approach of companies to engage in major capital expenditures, and the ongoing trend to procure products and services in a phased approach," observed CEO Chanan Weiss.

"Nevertheless, it's encouraging to see that gross margins continue to increase as a result of our restructured business model, which focuses more on license sales and fixed price projects.

"Moreover, our bottom line improved, achieving operating profitability and a positive cash flow due to the comprehensive cost-control programs we implemented last year," Weiss added.

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