NIC, Inc. (EGOV) is a provider of outsourced eGovernment portals. NIC designs, manages, and markets eGovernment services on behalf of state and local governments. The company headquartered in Olathe, Kansas, partners with government leaders and establishes local offices to provide customized solutions and, with the use of technology, increase efficiency and reduce costs for governments and their constituents.

In November 2007, the company announced for the third quarter a net income of $3.8M and earnings per share of six cents on total revenues of $21.6M. Operating income was $4.4M, up 23% from third quarter 2006. Third quarter results include a gain of $0.5M on the sale of a minority investment and an income tax expense reduction of $0.5M. Minus these items, net income would have been $2.8M or four cents per share.

Quarterly portal revenues were $20.7M, a 20% increase over the same period in 2006. On a same-state basis, portal revenues grew 19% compared to an 8% increase in the same 2006 quarter. NIC’s business licensing, vehicle registration and hunting and fishing license services performed well, helping same-state, transaction-based revenues from non-driver record (non-DMV) applications increased 31% compared to 25% from the prior year, same quarter. DMV revenues grew 11% on a same-state basis in third quarter 2007.

“Non-DMV services continue to grow strongly,” said Jeff Fraser, chief executive officer. “A key component of our strategic growth initiative is to increase revenues from non-DMV services, and this quarter’s numbers are a good indicator that we continue to meet this objective.”

In the third quarter, the company sold its 12% minority investment in e-Government Solutions Ltd., a private joint venture based in London, and recognized a gain of $0.5M (one cent per share) on the cash proceeds from the sale. Third-quarter results also reflect a change in the company’s uncertain tax positions that reduced income tax expense by $0.5M (one cent per share).

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