Revenues of $9.9 million and Adjusted EBITDA Net Income of $1.5
million and Net Income of $603,000 DUBLIN and DALLAS, Aug. 25
/PRNewswire-FirstCall/ -- Trintech Group Plc (NASDAQ:TTPA), a
leading global provider of integrated financial governance,
transaction risk management, and compliance solutions, today
announced revenues of $9.9 million for the second quarter ended
July 31, 2009, an adjusted EBITDA net income of $1.5 million and a
net profit for the quarter of $603,000. Highlights: -- Revenue
amounted to $9.9 million for Q2 of the 2010 fiscal year which
represented a 5% reduction compared to the same period of the prior
year. -- Trintech generated an adjusted EBITDA net income of $1.5
million for Q2 of the 2010 fiscal year compared to an adjusted
EBITDA net income of $215,000 for the corresponding period in the
prior year, representing growth of 595%. Adjusted EBITDA net income
per ADS was $0.09 for Q2 of the 2010 fiscal year compared to $0.01
for the same period in the prior year. -- Trintech had cash
balances of $17.8 million (including restricted cash of $170,000)
at July 31, 2009. The Company also generated $826,000 cash from
operating activities for Q2 of the 2010 fiscal year which was an
increase of $945,000 compared to the same period in the prior year.
-- Gross margin amounted to $7.0 million in Q2 of the 2010 fiscal
year, representing 71% of revenue, compared to $7.1 million and 68%
in Q2 of the prior year. -- Trintech incurred research and
development expenditure of $1.4 million in Q2 of the 2010 fiscal
year compared with $1.6 million in Q2 of the prior year, a decrease
of 11%. -- Trintech reduced expenditure in sales and marketing by
22% from $3.5 million in Q2 in the 2009 fiscal year to $2.7 million
in the same quarter in the 2010 fiscal year. -- General and
administrative expenses decreased by 18% to $2.1 million in Q2 of
the 2010 fiscal year compared to $2.6 million in Q2 of the 2009
fiscal year. -- Trintech generated a net income of $603,000 in Q2
of the 2010 fiscal year compared with a net loss of $965,000 in Q2
of the 2009 fiscal year. Combined basic and diluted net income per
equivalent ADS for the quarter ended July 31, 2009 was $0.04,
compared to a basic and diluted net loss of $0.06 for the same
period in the prior year. Cyril McGuire, Chief Executive Officer,
said, "Our Q2 trading performance was strong with very robust
growth in our EBITDA earnings of $1.5 million representing over
595% growth compared to the same period last year. Our management
focus is to increase profitability and cash generation, control our
operating costs while still investing in target opportunities.
During the quarter, we experienced growth in our customer pipeline,
an improvement in our order backlog, and some early encouraging
signs of recovery in our target markets. Overall, Trintech is well
positioned to execute and capitalise on future market opportunities
as the broader economy recovers." Paul Byrne, President, added,
"Trintech's strategy of helping senior finance executives drive
real financial returns from automating more of their financial
processes continues to underpin strong EBITDA profit growth. As the
economic environment begins to recover and we benefit from the
launch of new products, such as Unity XFR, and develop new
partnerships, we believe the Company will continue to grow EBITDA
profitability." Recent Highlights include: Trintech announced that
P.F. Chang's has selected its ReconNET software to automate their
high volume revenue and treasury reconciliation process. ReconNET
is a component of Trintech's Unity platform, a suite of modular
software that enables companies to meet their financial governance,
risk management and compliance goals. P.F. Chang's China Bistro,
Inc. owns and operates two restaurant concepts in the Asian niche
in the United States. Trintech announced that Mexx has selected its
ReconNET software for financial process compliance. Mexx markets an
extensive range of fashion apparel and lifestyle accessories for
women, men and children. Trintech announced a strategic partnership
with WNS (Holdings) Limited (NYSE:WNS), a leading provider of
business process outsourcing (BPO) services and solutions. Under
the terms of the agreement, WNS will offer its customers Trintech's
financial governance applications, implementation services and
technical support in order to maximize efficiencies, tighten
controls and increase ROI from financial operations. Trintech
announced that Providence Health & Services had increased
revenue by $35 million using Concuity ClearContracts. Trintech
signed an agreement to expand the breadth of services provided to
the Providence multi-hospital system. Providence Health &
Services has, based on the success achieved to date, extended its
agreement to include the addition of four more facilities using the
ClearContracts software-as-a-service revenue management solution
from Concuity. The expanded agreement includes an extension of
Concuity's ClearContracts solutions to the 16 hospitals located in
the Washington, Alaska, Montana and California regions of
Providence Health & Services. Providence uses ClearContracts
for all contract management functions including accounts
receivables management, account recovery, management reporting and
managed care contract negotiations. Trintech announced the
availability of Unity Xtensible Financial Reporting (XFR), a
financial reporting software solution with embedded support for the
tagging and output of XBRL-compliant financial statements. As
global accounting standards have started to converge, businesses
are increasingly being required to understand and adopt XBRL as an
enabling technology in enterprise wide disclosure initiatives being
mandated by global financial governing bodies, such as the SEC's
Final Rule in the US and HMRC in the UK. Trintech announced that
the independent research firm Forrester Research, Inc. had included
Trintech on its report "The Forrester Wave(TM): Enterprise
Governance, Risk and Compliance Platforms, Q3 2009." Trintech held
its 10th Annual General Meeting (AGM) as a public company in
Dublin, Ireland. At the AGM, Cyril McGuire, Chairman and CEO,
welcomed the approval by shareholders of all the ordinary and
special resolutions including the approval of the share buy-back
agreement with First Analysis Securities Corporation. The timing
and amount of any repurchase by Trintech under the share buy-back
programme will be dependent upon market conditions, securities law
limitations and other corporate considerations. Trintech announced
the successful conclusion of its thirteenth annual US-based
Customer Conference held May 18-20 at the Omni Fort Worth Hotel in
Fort Worth, Texas. The Conference, which attracted more than 200
attendees, featured finance, accounting and treasury professionals
from world-class organizations, including Intel, Target, Hewlett
Packard, FedEx Office, Lockheed Martin, Sprint, Yahoo!, Questar and
more. This year's conference theme focused on helping clients
maximize current and planned investments in governance, risk and
compliance solutions to increase productivity and achieve more with
existing resources. Results Overview: Revenue for the second
quarter ended July 31, 2009 was $9.9 million compared with $10.5
million for the corresponding quarter in the prior year, a decrease
of 5%. The strengthening of the dollar versus the pound and the
euro accounted for approximately $115,000 of this revenue variance
and the remaining revenue variance was due to the reasons outlined
below. Software license revenue for the quarter ended July 31, 2009
was $5.3 million compared with $5.4 million for the corresponding
quarter in the prior year, a decrease of 1%. The decrease was
primarily due to weaker governance, risk and compliance (GRC)
license sales in the quarter in the EMEA markets due to economic
uncertainty in these markets negatively impacting our normal sale
cycles with customers becoming more cautious, procurement processes
lengthening and general uncertainty creating significant challenges
to close new business. This fall in revenues was partially offset
by stronger maintenance revenues from existing customers in the US.
Service revenue for the quarter ended July 31, 2009 was $4.6
million compared with $5.1 million for the corresponding quarter in
the prior year, a decrease of 10%. The decrease was primarily due
to a fall in revenues from our GRC business in the US and European
markets which was partially offset by an increase in revenues from
ASP services in our Healthcare business in the US. Total gross
margin for the second quarter ended July 31, 2009 was $7.0 million,
a decrease of 1% from $7.1 million in the corresponding quarter in
the prior year. Gross margin percentage increased to 71% in Q2 of
the 2010 fiscal year compared to 68% in the same period of the
prior year. The increase in margin percentage was due to a change
in the revenue mix. Total operating expenses for the second quarter
ended July 31, 2009 were $6.6 million, a decrease of 18% from $8.0
million in the corresponding quarter in the prior year. The
decrease in costs was primarily due to headcount reductions and
lower salary costs. There has also been a reduction in
discretionary expenditure in all areas of Trintech over the last
year as the economic position worsened in the US and Europe. The
strengthening of the dollar versus the pound and the euro accounted
for approximately $246,000 of this operating cost reduction
compared to Q2 in the prior year. Adjusted EBITDA operating
expenses for the quarter ended July 31, 2009 were $5.9 million, a
decrease of 17% compared to adjusted EBITDA operating expenses of
$7.1 million for the corresponding period in the prior year.
Restructuring expenses were $19,000 for the quarter ended July 31,
2009. These charges related primarily to employee termination costs
as a result of the company re-aligning its cost base in the current
difficult economic environment. Adjusted EBITDA net income was $1.5
million for the second quarter ended July 31, 2009 compared to an
adjusted EBITDA net income of $215,000 for the corresponding
quarter in the prior year. This represented a 595% increase from Q2
in the prior year and reflects the company's lower operating cost
base. Trintech's balance sheet remains strong with cash balances of
$17.8 million (including restricted cash of $170,000) as of July
31, 2009. Net cash generated from operations for the three months
ended July 31 2009 was $826,000. Trintech will host a conference
call to discuss its financial results and business outlook
beginning at 15:30hrs (UK Time) today, Wednesday, August 26, 2009.
Please see advisory for information on the call. A web simulcast of
Trintech's conference call reviewing our performance for Q2 of
fiscal year 2010 and our business outlook for Q3 fiscal year 2010
will be broadcast live today, Wednesday, August 26, 2009 at 15:30
hrs (UK Time), 10:30 hrs (NY Time) and 07:30 hrs (CA Time) and
thereafter for 1 year at http://www.trintech.com/investor. An
instant telephone replay will also be available for 10 days by
dialing +44 1452 55 00 00 and entering the following access number
(99452612 #). About Trintech Group Trintech Group Plc (NASDAQ:TTPA)
is a leading global provider of integrated financial governance,
transaction risk management, and compliance solutions. The Company
enables companies to achieve excellence in financial governance and
performance management through a comprehensive platform of account
reconciliation, accounting compliance, and financial reporting
applications across the financial lifecycle. Over 600 leading
global organizations are realizing the benefits of Trintech
solutions every day to gain greater control, visibility, and
efficiency across financial processes; improve financial
performance through stronger management of revenue and cost cycles;
ensure the accuracy and integrity of financial data, thereby
reducing the risk of material weaknesses and restatements and to
drive immediate efficiencies and cost reductions in financial
operations through automation and scalability. Trintech's customers
include retail chains, commercial companies, financial institutions
and healthcare providers in the United States, the UK and the
Republic of Ireland, continental Europe and Australia. Customers
who have used our software in recent years include Ericsson, HSBC,
Regis Corporation, Providence Health & Services and Cleveland
Clinic Foundation. For more information on how Trintech can help
you increase confidence in business performance and reduce
financial risk, please contact us online at
http://www.trintech.com/ or at our principal business office in
Addison, Texas, or through an international office in Ireland, the
United Kingdom, or the Netherlands. Trintech - 15851 Dallas
Parkway, Suite 900 - Addison, TX 75001 - Tel 1 972 701 9802
Trintech UK Ltd. - Warnford Court, 29 Throgmorton St. - London
EC2N2AT, UK - Tel +44 (0) 20 7628 5235 Trintech Technologies -
Block C, Central Park - Leopardstown, Dublin 18, Ireland - Tel +353
1 293 9840 Trintech - Cypresbaan 9 - 2908 LT Capelle a/d Ijssel,
The Netherlands - Tel +31 (0) 10 8507 474 Forward Looking
Statements 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 business outlook and product strategy, areas
of management focus, and Trintech's belief that it is well
positioned to execute and capitalize on future market opportunities
and will continue to grow EBITDA profitability. Factors that could
cause or contribute to such differences include Trintech's ability
to accurately predict future sales, its ability to accurately
predict and meet customer needs and to successfully position itself
in the market, Trintech's ability to ensure the performance of its
products and services, and its ability to improve the performance
of its organization and ensure the long term health of its
business. 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, 2009 filed with the US Securities and Exchange
Commission (http://www.sec.gov/) and subsequent filings with the US
Securities and Exchange Commission. Lastly, Trintech assumes no
obligation to update these forward-looking statements. Contact Paul
Byrne, President Joseph Seery, VP Finance, Group Trintech Group Plc
+353 1 293 9840 TRINTECH GROUP PLC CONDENSED CONSOLIDATED BALANCE
SHEETS (UNAUDITED) (U.S. dollars in thousands) July 31, January 31,
-------- ----------- ASSETS 2009 2009 ---- ---- Current assets Cash
and cash equivalents $17,675 $17,363 Restricted cash - 1,143
Accounts receivable, net of allowance for doubtful accounts of $268
and $267 at July 31, 2009 and January 31, 2009, respectively 5,389
6,021 Prepaid expenses and other current assets 1,230 1,140
Deferred costs 275 296 Net current deferred tax asset 362 252 ---
--- Total current assets 24,931 26,215 ------ ------ Non-current
assets Restricted cash 170 170 Property and equipment, net 1,171
1,430 Deferred costs 783 261 Intangible assets, net 4,123 5,309
Goodwill 24,003 24,089 ------ ------ Total non-current assets
30,250 31,259 ------ ------ Total assets $55,181 $57,474 =======
======= LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities
Accounts payable 94 704 Accrued payroll and related expenses 2,170
1,878 Deferred consideration - 2,970 Income taxes payable 149 161
Other accrued liabilities 1,706 1,730 Deferred revenues 10,920
10,122 ------ ------ Total current liabilities 15,039 17,565 ------
------ Non-current liabilities Capital leases due after more than
one year - 42 Income taxes payable 61 110 Net non-current deferred
tax liability 362 252 Deferred rent less current portion 470 537
--- --- Total non-current liabilities 893 941 --- --- Series B
preference shares, $0.0027 par value 10,000,000 authorized at July
31, 2009 and January 31, 2009, respectively None issued and
outstanding - - Shareholders' equity: Ordinary Shares, $0.0027 par
value: 100,000,000 shares authorized; 33,454,385 shares issued and
32,945,761 and 31,843,333 shares outstanding at July 31, 2009 and
January 31, 2009, respectively. 90 90 Additional paid-in capital
253,230 253,076 Treasury shares (at cost, 508,624 and 595,552 at
July 31, 2009 and January 31, 2009, respectively) (750) (879)
Accumulated deficit (209,175) (209,367) Accumulated other
comprehensive loss (4,146) (3,952) ------ ------- Total
shareholders' equity 39,249 38,968 ------ ------ Total liabilities
and shareholders' equity $55,181 $57,474 ======= ======= TRINTECH
GROUP PLC CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED) (U.S. dollars in thousands, except share and per share
data) Three Months Six Months Ended July 31, Ended July 31,
-------------- -------------- 2009 2008 2009 2008 ---- ---- ----
---- Revenue License $5,305 $5,373 $10,111 $10,271 Service 4,624
5,112 8,983 9,855 ----- ----- ----- ----- Total revenue 9,929
10,485 19,094 20,126 ----- ------ ------ ------ Cost of revenue
License 560 588 1,116 1,086 Amortization of purchased technology
181 226 362 442 Service 2,150 2,577 4,525 4,821 ----- ----- -----
----- Total cost of revenue 2,891 3,391 6,003 6,349 ----- -----
----- ----- Gross margin 7,038 7,094 13,091 13,777 Operating
expenses: Research and Development 1,384 1,558 2,870 3,050 Sales
and marketing 2,702 3,458 4,938 6,537 General and administrative
2,099 2,554 4,245 5,043 Restructuring charges 19 54 253 54
Amortization of purchased intangible assets 412 415 824 810 --- ---
--- --- Total operating expenses 6,616 8,039 13,130 15,494 -----
----- ------ ------ Income (loss) from operations 422 (945) (39)
(1,717) Interest income, net 12 74 37 192 Exchange gain (loss), net
166 (4) 227 101 --- --- --- --- Income (loss) before provision for
income taxes 600 (875) 225 (1,424) Provision for income taxes 3
(90) (33) (29) --- --- --- --- Net income (loss) $603 $(965) $192
$(1,453) ==== ===== ==== ======== Weighted-average shares used in
computing basic net income (loss) per Ordinary Share Basic
32,945,761 31,910,955 32,848,156 31,900,826 ========== ==========
========== ========== Diluted 32,979,535 31,910,955 32,863,235
31,900,826 ========== ========== ========== ========== Basic and
diluted income (loss) per Ordinary Share $0.02 $(0.03) $(0.01)
$(0.05) ===== ====== ====== ====== Basic and diluted income (loss)
per equivalent ADS $0.04 $(0.06) $(0.01) $(0.09) ===== ======
====== ====== TRINTECH GROUP PLC RECONCILIATION OF NET INCOME
(LOSS) TO ADJUSTED EBITDA NET INCOME (U.S. dollars in thousands,
except share and per share data) Three Months Ended Six months
ended July 31, July 31, -------- -------- 2009 2008 2009 2008 ----
---- ---- ---- Net income (loss) $603 $(965) $192 $(1,453)
Adjustments: Depreciation 151 190 318 392 Amortization 593 641
1,186 1,252 Share-based compensation 143 279 241 539 Restructuring
charges 19 54 253 54 Interest income, net (12) (74) (37) (192)
Income taxes (3) 90 33 29 --- --- --- --- Adjusted Earnings Before
Interest, Taxation, Depreciation, Amortization, Share-based
compensation and Restructuring charges (EBITDA) net income $1,494
$215 $2,186 $621 ===== === ===== === Adjusted Basic and diluted
income per Ordinary Share $0.05 $0.01 $0.07 $0.02 ==== ==== ====
==== Adjusted basic and diluted income per ADS equivalent $0.09
$0.01 $0.13 $0.04 ==== ==== ==== ==== Note: Management believes
Adjusted EBITDA net income is an important measure of Company
performance without consideration of the non-operating income and
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 Ended
Six months ended July 31, July 31, -------- -------- 2009 2008 2009
2008 ---- ---- ---- ---- Total operating expenses $6,616 $8,039
$13,130 $15,494 Adjustments: Restructuring charges (19) (54) (253)
(54) Depreciation (140) (168) (299) (349) Amortization (412) (415)
(824) (810) Share-based compensation (129) (262) (221) (508) ----
---- ---- ---- Adjusted EBITDA operating expenses $5,916 $7,140
$11,533 $13,773 ===== ===== ====== ====== Note: Management believes
Adjusted EBITDA operating expenses 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 (UNAUDITED)
(U.S. dollars in thousands) Six Months Ended July 31,
--------------- 2009 2008 ---- ---- CASH FLOWS FROM OPERATING
ACTIVITIES: Net income (loss) $192 $(1,453) Adjustments to
reconcile net income (loss) to net cash provided by operating
activities: Depreciation 318 392 Amortization 1,186 1,252
Share-based compensation 241 539 Effect of changes in foreign
currency exchange rates (142) (69) Changes in operating assets and
liabilities: Accounts receivable 1,803 873 Prepaid expenses and
other current assets (539) (264) Accounts payable (619) 492 Accrued
payroll and related expenses 246 (512) Deferred revenues (397) 248
Other accrued liabilities (209) (607) ---- ---- Net cash provided
by operating activities 2,080 891 ----- --- CASH FLOWS FROM
INVESTING ACTIVITIES: Purchases of property and equipment (52)
(148) Payments relating to acquisitions (2,883) (8,708) ------
------ Net cash used in investing activities (2,935) (8,856) ------
------ CASH FLOWS FROM FINANCING ACTIVITIES: Principal payments on
capital leases (79) (73) Issuance of ordinary shares 41 65 Decrease
in restricted cash deposits 1,143 - ----- --- Net cash provided by
(used in) financing activities 1,105 (8) ----- --- Net increase
(decrease) in cash and cash equivalents 250 (7,973) Effect of
exchange rate changes on cash and cash equivalents 62 149 Cash and
cash equivalents at beginning of period 17,363 23,766 ------ ------
Cash and cash equivalents at end of period $17,675 $15,942 =======
======= Supplemental disclosure of cash flow information Interest
paid $9 $17 === === Taxes paid $93 $164 === ==== Supplemental
disclosure of non-cash flow information Acquisition of property and
equipment under capital leases $- $(30) === ==== Shares issued in
connection with acquisition $- $1,239 === ====== DATASOURCE:
Trintech Group Plc CONTACT: Paul Byrne, President, , or Joseph
Seery, VP Finance, Group, , both of Trintech Group Plc, +353 1 293
9840 Web Site: http://www.trintech.com/
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