DUBLIN, Ireland and DALLAS, Aug. 25, 2004 (PRIMEZONE) -- Trintech Group Plc (Nasdaq:TTPA) (Prime Standard:TTP), a leading provider of transaction management and payment infrastructure solutions, today announced second quarter revenues of $13.2 million and profits of $351,000, equivalent to a basic and diluted net income per equivalent American Depositary Share (ADS) of $0.02.
Highlights
-- Revenue growth of 31 percent in Q2 compared to corresponding quarter last year. -- Trintech maintains profitability in Q2, with a net income of $351,000 and an Adjusted EBITDA net income of $804,000. Adjusted EBITDA net income excludes restructuring charges, net amortization and impairment of goodwill and purchased intangible assets, depreciation, adjustment of acquisition liabilities, stock compensation, interest income, net and income taxes. -- Basic and diluted net income per equivalent ADS for the quarter ended July 31, 2004 was $0.02 compared with basic and diluted net loss per equivalent ADS of $0.12 for the corresponding quarter ended July 31, 2003.
Cyril McGuire, Chairman and Chief Executive Officer commenting on the results said: "I am delighted to report a strong set of results for Q2 with Trintech achieving healthy revenue growth and continued profitability. Our investment in new products, especially for the Chip and PIN opportunity is achieving positive results. Our strategy is to leverage our multi-channel payment expertise and continue to build strategic relationships and expand channels of distribution globally."
Recent highlights include:
* Trintech announced that Maplin Electronics implemented Trintech's bank-accredited PayWare Merchant card payment processing solution and Smart 5000 transaction processing devices to process all its card payment transactions, including EMV Chip and PIN.
* Trintech announced a strategic alliance with SunGard Treasury Systems, whereby Trintech's data network will provide SunGard clients with seamless access to electronic daily balance transaction and balance statements from North American banks.
* Trintech announced that it had partnered with Quest Retail Technology, a leading developer and supplier of PoS (point-of-sale) technology, to provide a complete EFT and Chip and PIN solution to UK merchants. As part of the agreement, Quest will now integrate Trintech's PayWare EFT and PayWare SmartPIN Chip and PIN solution with its own range of PoS terminals, including the award-winning V-Touch, touch screen terminal.
* Trintech announced that more than 200 treasury and accounting delegates from 115 leading companies gathered in Miami, Florida for Trintech's eighth annual Customer Conference in May. Customers attended sessions and networked with other users and Trintech's experts to increase the benefits from Trintech's funds management software and services, including ReconNET, Bank Fee Analysis, and the DataFlow Transaction Network.
* Trintech held its 5th Annual General Meeting (AGM) as a public company in Dublin, Ireland. The Chairman welcomed the appointment by the Shareholders of Dr. Jim Mountjoy to the Board and the approval of the share buy back agreement with Deutsche Bank AG.
Results Overview:
Revenue for the six months ended July 31, 2004 was $25.6 million compared with $20.3 million for the six months ended July 31, 2003, an increase of 26 percent. Second quarter revenue increased 31 percent to $13.2 million compared with $10.1 million for the corresponding quarter last year.
First half product revenue increased 81 percent to $7.9 million this year from $4.4 million last year. Q2 product revenue increased 138 percent to $4.3 million compared with the corresponding quarter last year.
First half software license revenue decreased 4 percent to $10.9 million this year from $11.4 million last year. Q2 software license revenue decreased 7 percent to $5.5 million from $5.9 million for the corresponding quarter last year.
First half service revenue increased 49 percent to $6.7 million from $4.5 million last year. Service revenue increased 44 percent to $3.4 million this quarter compared with the corresponding quarter last year. The year on year increase includes post-acquisition revenues of the DataFlow Services business.
First half gross margin was $15.3 million, an increase of 42 percent from $10.8 million in the corresponding period last year. Total gross margin for the second quarter was $7.6 million, an increase of 38 percent from $5.5 million in the corresponding quarter last year.
First half operating expenses increased 11 percent to $15.1 million from $13.6 million in the corresponding period last year. Adjusted EBITDA operating expenses for the first half this year were $14.1 million, an increase of 6 percent on the Adjusted EBITDA operating expenses for the first half last year.
Operating expenses in Q2 fell 2 percent to $7.4 million compared to the corresponding quarter last year. Adjusted EBITDA operating expenses for Q2 this year were $6.9 million, an increase of 5 percent on the Adjusted EBITDA operating expenses for Q2 last year.
Trintech's balance sheet remains strong with closing net cash and cash equivalent balances of $38.6 million. Net cash generation for Q2 was $355,000. Cash generated from operating activities was approximately $584,000 which was partially used to make acquisition related payments of $123,000 in respect of acquisitions made in prior periods and to purchase capital equipment for $121,000.
During the quarter, Trintech did not repurchase shares under its ongoing stock repurchase program. As of July 31, 2004 approximately $4.4 million remained available for future repurchases under this program.
"Trintech's second quarter results demonstrate the continued successful execution of our strategy of focussing on key growth markets, such as Chip and PIN solutions and treasury and cash management solutions. Combining this strong focus with stringent cost control has enabled us to expand our net operating margins and grow profits", said Paul Byrne, Chief Financial Officer.
Trintech will host a conference call to discuss its financial results and business outlook beginning at 15:30hrs (UK Time) today, August 25th 2004. Please see advisory for information on the call.
A web simulcast of Trintech's conference call reviewing our performance for Q2 fiscal year 2005 and our business outlook for Q3 fiscal year 2005 will be broadcast live today, Wednesday August 25th, 2004 at 3:30 PM (UK Time), 10:30 AM (NY Time) and 07:30 AM (CA Time) and thereafter for 1 year at www.trintech.com. An instant telephone replay will also be available for 10 days by dialing +44 1452 550 000 and entering the following access number (1747421 #).
About Trintech
Trintech is a leading provider of secure payment infrastructure and transaction management solutions to financial institutions, payment processors, enterprise retailers and network operators globally. Built on over 17 years of experience, Trintech's solutions manage each area of the payment transaction cycle from authentication, authorization, settlement, dispute resolution and reconciliation -- enabling our customers to reduce transactions costs, eliminate fraud, minimize risk, maximize cashflow and increase profitability. Trintech can be contacted in Ireland at Trintech Building, South County Business Park, Leopardstown, Dublin 18 (Tel: +353-1-207-4000), in the US at 15851 Dallas Parkway, Suite 855, Addison, TX 75001 (Tel: +1-972 701 9802), and in the UK at 186-192 Darkes Lane, Potters Bar, Hertfordshire, EN6 1AF (T: +44 (0) 1707 827000). www.trintech.com
This news release contains "forward looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Any "forward looking statements" in this press release are subject to certain risks and uncertainties that could cause actual results to differ materially from those stated. "Forward looking statements" in this press release include statements, among others, relating to Trintech's market position and business focus, the planned roll out of Trintech's products with third parties, including SunGard Treasury Systems and Quest Retail Technology, and Trintech's ability to successfully execute its business strategy. Factors that could cause or contribute to such differences include Trintech's ability to accurately predict future sales, its ability to accurately predict customer needs and to successfully position itself in the market, the long term health of Trintech's business and ability to improve performance of the organization, the ability of its customers to fulfill their commitments to adopt Trintech's secure payment technology, delay or reduction in the size of the planned SunGard Treasury Systems and Quest Retail Technology roll outs, the growth of the secure payments software and services market, Trintech's ability to develop, market and sell secure payments and treasury and cash management software, the market acceptance of the security standards for payment transactions, the ability to improve and expand the functionality of products, the ability to develop strategic relationships, the ability to react to rapid technological change rapidly and the effects of macroeconomic uncertainty on the demand for Trintech's products. Actual performance may also be affected by other factors more fully discussed in Trintech's Form 20-F for the fiscal year ended January 31, 2004, and Form 6-K for the quarter ended April 30, 2004 filed with the US Securities and Exchange Commission (www.sec.gov). Lastly, Trintech assumes no obligation to update these forward-looking statements.
TRINTECH GROUP PLC CONDENSED CONSOLIDATED BALANCE SHEETS (U.S. dollars in thousands, except share and per share data) July 31, January 31, 2004 2004 ASSETS Current assets: Cash and cash equivalents $ 38,041 $ 36,864 Restricted cash 555 1,211 Accounts receivable, net of allowance for doubtful accounts of $661 and $1,595 8,729 9,800 respectively Inventories 486 824 Value added taxes 313 471 Prepaid expenses and other 3,025 2,706 assets Total current 51,149 51,876 assets Property and equipment, net 792 988 Other non-current assets 3,571 3,994 Goodwill, net of accumulated amortization and impairment of $84,471 at July 31, 2004 and 7,459 7,459 January 31, 2004 respectively Total assets $ 62,971 $ 64,317 LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable 3,503 4,804 Accrued payroll and related 1,648 1,864 expenses Other accrued liabilities 5,521 5,699 Value added taxes 882 819 Warranty reserve 451 356 Deferred revenue 8,617 8,739 Total current 20,622 22,281 liabilities Non-current liabilities: Capital leases due after 17 84 more than one year Government grants repayable 153 157 and related loans Provision for lease 218 441 abandonment Total non-current 388 682 liabilities Series B preference shares, $0.0027 par value 10,000,000 authorized; None issued and - - outstanding Shareholders' equity: Ordinary Shares, $0.0027 par value: 100,000,000 shares authorized; 30,836,283 and 30,596,775 shares issued and outstanding at July 31, 2004 and 83 83 January 31, 2004 respectively Additional paid-in capital 246,186 245,965 Treasury shares (189,082 and 254,508 at July 31,2004 and January 31, 2004 (199) (268) respectively) Accumulated deficit (201,740) (202,175) Accumulated other (2,369) (2,251) comprehensive loss Total 41,961 41,354 shareholders' equity Total liabilities $ 62,971 $ 64,317 and shareholders' equity TRINTECH GROUP PLC CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (U.S. dollars in thousands, except share and per share data) Three months Six months ended July 31, ended July 31, 2004 2003 2004 2003 Revenue: Product $ 4,332 $ 1,820 $ 7,932 $ 4,393 License 5,475 5,875 10,896 11,365 Service 3,403 2,358 6,749 4,516 Total Revenue 13,210 10,053 25,577 20,274 Cost of revenue: Product 3,216 1,489 5,451 3,508 License 946 1,338 1,883 2,698 Service 1,467 1,719 2,890 3,263 Total Cost of Revenue 5,629 4,546 10,224 9,469 Gross Margin 7,581 5,507 15,353 10,805 57% 55% 60% 53% Operating expenses: Research & 2,153 2,007 4,331 3,945 development Sales & 2,268 2,261 4,505 4,553 marketing General & 2,682 2,733 5,650 5,604 administrative 45 434 351 434 Restructuring charge Amortization 212 98 423 196 of purchased intangible assets Adjustment of -- -- (249) -- acquisition liabilities Adjustment of -- -- -- (1,149) acquisition deferred consideration Stock -- 6 101 20 compensation Total operating expenses 7,360 7,539 15,112 13,603 Income (loss) 221 (2,032) 241 (2,798) from operations Interest income, net 74 60 156 160 Exchange (loss) gain, net 132 159 114 155 Income (loss) before provision for income taxes 427 (1,813) 511 (2,483) Provision for income taxes (76) -- (76) -- Net income (loss) $ 351 $ (1,813)$ 435 $ (2,483) Basic net income $ 0.01 $ (0.06)$ 0.01 $ (0.08) (loss) per Ordinary Share Shares used in computing basic net income (loss) per Ordinary Share 30,791,850 30,156,466 30,734,700 30,274,558 Diluted net income (loss) per Ordinary Share $ 0.01 $ (0.06)$ 0.01 $ (0.08) Shares used in computing diluted net income (loss) per Ordinary Share 32,296,608 30,156,466 32,285,188 30,274,558 Basic net income (loss) per equivalent ADS $ 0.02 $ (0.12)$ 0.03 $ (0.16) Diluted net income (loss) per equivalent ADS $ 0.02 $ (0.12)$ 0.03 $ (0.16) TRINTECH GROUP PLC RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA NET INCOME (LOSS) (U.S. dollars in thousands) Three months Six months ended July 31, Ended July 31, 2004 2003 2004 2003 Net income (loss) $ 351 $(1,813) $ 435 $(2,483) Adjustments: Depreciation 193 410 416 804 Amortization of purchased 212 430 423 860 intangible assets Adjustment of acquisition liabilities -- -- (249) -- Adjustment of acquisition deferred consideration -- -- -- (1,149) Stock compensation -- 6 101 20 Restructuring charge 45 434 351 434 Interest income, net (73) (60) (155) (160) Income taxes 76 -- 76 -- Adjusted earnings Before Interest Taxation Deprecation and $ 804 $ (593) $ 1,398 $(1,674) Amortization (EBITDA) net income (loss) Note: Management believes Adjusted EBITDA is an important measure of Company performance without consideration of the non-operating expense adjusted above as it presents a clearer view of operational performance changes between the comparative periods. TRINTECH GROUP PLC RECONCILIATION OF OPERATING EXPENSES TO ADJUSTED EBITDA OPERATING EXPENSES (U.S. dollars in thousands) Three months Six months ended July 31, ended July 31, 2004 2003 2004 2003 Total operating expense $ 7,360 $ 7,539 $ 15,112 $ 13,603 Adjustments: Restructuring charge (45) (434) (351) (434) Depreciation (176) (394) (384) (769) Amortization of purchased intangible assets (212) (98) (423) (196) Impairment of goodwill and purchased intangible assets -- -- -- -- Adjustment of acquisition liabilities -- -- 249 -- Adjustment of acquisition deferred consideration -- -- -- 1,149 Stock Compensation -- (6) (101) (20) Adjusted EBITDA operating expenses $ 6,927 $ 6,607 $ 14,102 $ 13,333 Note: Management believes Adjusted EBITDA is an important measure of Company performance without consideration of the non-operating expense adjusted above as it presents a clearer view of operational performance changes between the comparative periods. TRINTECH GROUP PLC CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (U.S. dollars in thousands) Six months ended July 31, 2004 2003 CASH FLOWS FROM OPERATING ACTIVITIES: Net income (loss) $ 435 $ (2,483) Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: Depreciation and 839 1,664 amortization Stock compensation 101 20 Effect of changes (158) (880) in foreign currency exchange rates Changes in operating assets and liabilities: Reductions to 656 453 restricted cash deposits Inventories 324 1,825 Accounts 1,012 1,321 receivable Prepaid (364) 173 expenses and other assets Value added tax 154 234 receivable Accounts (1,258) (1,070) payable Accrued payroll (199) (493) and related expenses Deferred (49) (69) revenues Value added tax 58 177 payable Warranty 107 (237) reserve Government (395) grants - repayable and related loans Other accrued 266 (1,269) liabilities Net cash provided by 1,924 (1,029) (used in) operating activities CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of property (235) (329) and equipment Payments relating to (485) (1,763) acquisitions Net cash used in (720) (2,092) investing activities CASH FLOWS FROM FINANCING ACTIVITIES: Principal payments on (191) (223) capital leases Issuance of ordinary 199 87 shares Repurchase of ordinary (512) shares - Expense of share issue (10) - Proceeds under bank 1,020 overdraft facility - Net cash provided by (2) 372 (used in) financing activities Net 1,202 (2,749) increase/(decrease) in cash and cash equivalents Effect of exchange (25) 131 rate changes on cash and cash equivalents Cash and cash 36,864 42,559 equivalents at beginning of period Cash and cash $ 38,041 $ 39,941 equivalents at end of period Supplemental disclosure of cash flow information Interest paid $ 17 $ 49 Taxes paid $ 256 $ 59 Supplemental disclosure of non-cash flow information Acquisition of $ $ 87 property and - equipment under capital leases
The full press release including tables can be downloaded from the following link: http://hugin.info/130706/R/957978/137470.pdf