Letter to Shareholders
1971 was the first year in which we did not exceed prior years' records. Performance during the year was adversely affected by the major slowdown in the economy, which was particularly acute in the New England areaRevenue for the year totaled $2,419,034, a decrease from 1970's record high volume of $2,741,879. Net income totaled $99,262, equal to 12 cents per share, as compared with 1970's record high of $297,650, or 40 cents per share.
Despite a general decline in spending for outside computer services by major organizations in our market areas, the company experienced some very significant gains during the year.
Perhaps the most significant was the increasing confidence of our clients in entrusting to Keane Associates a growing share of the responsibility for helping them develop major software systems for critical applications.
As a result, the nature of our business shifted slightly, from a predominance of short-term software development work to complete project management and control of major software efforts.
This has resulted in what we believe is a favorable trend for the company's growth in the future. For example, as a result of long-term contractual agreements, we entered 1972 with the highest level of committed work in our history. During the year, we also participated in the initiation of several projects in which the company took responsibility for the staffing. operation and development of complete computer facilities for major clients.
These projects have been most successful to date, and we anticipate continued growth in the emerging facilities management sector of our business.
In addition, the year saw broadening of our services into new areas with substantial growth potential. Major work was done for university and government institutions-both of which are new markets for Keane Associates. Geographically, we expanded into the New York area, and established a profitable office in Philadelphia.
The scope of our work also grew. In 1971, we implemented major applications software systems in the distribution, manufacturing, insurance, banking and university fields. Our technical staff was heavily involved in implementing new operating systems and conversions to new-generation computers such as the System/370. We also conducted a variety of teleprocessing, data entry and small business computer projects, as well as numerous consulting efforts that assisted clients in key EDP decisions.
Planning was also completed in 1971 for the market ing of our first hardware product, a versatile desk-top computer called the Keane System/4. The system is unique in that it has potential usage in all types of environments, from small branch offices to large central computer complexes. In the 60 days since its announcement in January, bookings of the System/4 exceed 30 per cent of our first year's goal, and interest among computer users continues high.
The System/4 is manufactured for Keane Associates by the Cogar Corporation of Wappinger Falls, N.Y., a firm well known for its technological leadership in the computer industry.
Measured by the financial yardsticks of revenues and earnings, the past year was not our strongest. Measured by our broader product and service mix, expanded marketing base, and deeper client commitments, the year was our most ambitious one.
In summary, we believe the key strengths on which the company has been built-hard work by dedicated professionals will enable us to expand the business in a controlled and increasingly satisfactory manner in 1972.
John F. Keane, President
March 19, 1972
Annual Report
Key Information
Revenue - $2,420,000
Net Income - $99,000
Dividends - N/A
Employees - 117
Officers and Directors:
John F, Keane - President, Treasurer, Director
Paul J. Crowley - VP and Director
David W. Chase - VP and Director
Jules A. Cohen - VP
Thomas F. Cavanaugh, Jr. - VP
Franklin N. Mann - VP
John H. Reohr III - VP
External
John F. Rockart - Director
George B. Rockwell - Director
Norman B. Asher - Clerk
Headquarters - 36 Washington Street, Wellesley Hills, Mass. 02181
Locations - Boston, Providence, Worcester, Hartford, Westport, Philadelphia
Notes from the annual report:
- started working for university and government institutions
- expanded into the New York area and established an office in Philadelphia
- Keane had a wholly owned subsidiary - Systemation Associates, Inc. which was acquired March 1, 1971 for approx. $73,000 cash.
- started selling the Keane System /4 - made for Keane by the Cogar Corporation of Wappinger Falls, N.Y.