Exhibit 99.1
News Release
TRANSACTION SYSTEMS ARCHITECTS INC
224 SOUTH 108 AVENUE
OMAHA, NEBRASKA 68154
402.334.5101
FAX 402.390.8077
For more information contact:
William J. Hoelting
Vice President, Investor Relations
402.390.8990
FOR IMMEDIATE RELEASE
Transaction Systems Architects Reports
Second Quarter Results
Highlights -
o Revenue of $69.3 million and EPS of $.11
o Operating income of $11.3 million; operating margin of 16.3 percent
o Twelve month revenue backlog of $233.1 million
o Operating cash flow of $9.3 million; cash balance of $91.4 million
(OMAHA, Neb.-- April 29, 2003)-- Transaction Systems Architects, Inc. (Nasdaq:
TSAI), a leading global provider of enterprise e-payments and e-commerce
software, announced today that revenue for the second quarter of fiscal 2003 was
$69.3 million. Earnings per diluted share were $.11.
For the second quarter of fiscal 2003, revenue was $69.3 million with software
license fees of $38.2 million, maintenance fees of $19.5 million and services of
$11.6 million. The Company's recurring revenue was $42.7 million, or 61.6
percent of revenue, and non-recurring revenue was $26.6 million, or 38.4 percent
of revenue. Recurring revenue consists of monthly license fees of $21.9 million,
maintenance fees of $19.5 million and facilities management fees of $1.3
million. Operating income was $11.3 million with an operating margin of 16.3
percent. Operating cash flow was $9.3 million with a cash balance as of March
31, 2003 of $91.4 million. Net income for the quarter was $4.1 million or $.11
per diluted share.
The Company completed the second quarter of fiscal 2003 with $233.1 million in
backlog, consisting of $162.4 million in recurring revenue backlog and $70.7
million in non-recurring revenue backlog. The Company defines recurring revenue
backlog to be all monthly license fees, maintenance fees and facilities
management fees specified in executed contracts to the extent that the Company
believes that recognition of the related revenue will occur within one year. The
Company includes in its non-recurring revenue backlog all fees (other than
recurring) specified in executed contracts to the extent that the Company
believes that recognition of the related revenue will occur within one year.
Significant customers signed in the second quarter for ACI Worldwide, the
Company's largest business unit, include the following: a U.S. based card
processor purchased BASE24-es(TM) and ACI Payments Manager(TM); a top 500
financial institution in Spain selected ACI Proactive Risk Manager(TM) for debit
card fraud; a financial institution in Turkey selected ACI Proactive Risk
Manager(TM) for credit card and merchant fraud; and a top 500 financial
institution in Korea, signed an agreement for NET24(TM), ACI's middleware
solution. Additionally, a financial institution in the Netherlands expanded its
relationship with TSA through the purchase of BASE24-atm(R).
During the quarter, Insession Technologies, the Company's e-infrastructure
business unit, added five new customers. Solutions licensed include ICE(TM), a
data-communications software solution; Webgate(TM), a web server solution; and
Workpoint(R), a business process management solution.
IntraNet, the Company's international payments and message processing solutions
provider, signed a significant services deal with a leading Belgium financial
institution; completed the delivery of a multi-million dollar project with a
financial institution in Germany; and continued its customer migration projects
to Money Transfer Systems(TM)-AIX, which will position its customers to address
new business requirements in the future.
"In this difficult environment, we were able to hold our own," said Gregory
Derkacht, President and CEO. "We experienced weak demand across all geographic
channels. Overall, we were able to deliver solid revenue, EPS and cash flow due
to our backlog of contracted business, recurring revenue base and our expense
management. Assuming the economy remains challenging in the near term, we will
continue to take the appropriate actions to manage our business units by
controlling expenses and focusing on our growth initiatives, one of which is our
BASE24-es(TM) multi-platform solution."
The Company will provide further details regarding its financial performance for
the second quarter of fiscal 2003 in its scheduled teleconference to be held
Tuesday, April 29, 2003 at 4:00 pm CST. Interested persons may access a
real-time audio broadcast of the teleconference at: www.tsainc.com/ir/ir.asp.
The web cast will be archived for 10 days after the teleconference at the same
web address listed above.
About Transaction Systems Architects, Inc.
The Company's software facilitates electronic payments by providing consumers
and companies access to their money. Its products are used to process
transactions involving credit cards, debit cards, secure electronic commerce,
mobile commerce, smart cards, secure electronic document delivery and payment,
checks, high-value money transfers, bulk payment clearing and settlement, and
enterprise e-infrastructure. The Company's solutions are used on more than 1,650
product systems in 71 countries on six continents.
Forward-Looking Statements
This press release contains forward-looking statements based on current
expectations that involve a number of risks and uncertainties. Generally,
forward-looking statements do not relate strictly to historical or current
facts, and include words or phrases such as "management anticipates," "the
Company believes," "the Company anticipates," "the Company expects," "the
Company plans," "the Company will," and words and phrases of similar impact, and
include but are not limited to statements regarding future operations, business
strategy and business environment. The forward-looking statements are made
pursuant to safe harbor provisions of the Private Securities Litigation Reform
Act of 1995. Forward-looking statements included in this press release include
statements regarding (1) the Company's recurring and non-recurring backlog, and
(2) management of our business units in the future by controlling expenses and
focusing on growth initiatives. Actual results could differ materially from that
contained in the forward-looking statements. Factors that could cause actual
results to differ include, but are not limited to, the following:
o The Company's calculation of backlog is based on customer contracts that
exist on the date of the calculation. A number of factors may change after
the date of calculation that could result in actual revenues being less
than the amounts contained in backlog. The Company's customers may attempt
to renegotiate or terminate their contracts due to a number of factors,
including mergers, changes in their financial condition, or general changes
in economic conditions in the customer's industry or geographic location,
or the Company may experience delays in the development of products or
services specified in customer contracts. Accordingly, there can be no
assurance that contracts included in recurring or non-recurring revenue
backlog will actually generate the specified revenues or that the actual
revenues will be generated within the one-year period.
Any or all of the forward-looking statements may turn out to be wrong. They can
be affected by inaccurate assumptions or by known or unknown risks and
uncertainties. Many of these factors will be important in determining the
Company's actual future results. Consequently, no forward-looking statement can
be guaranteed. Actual future results may vary materially from those expressed or
implied in any forward-looking statements.
These cautionary statements and any other cautionary statements that may
accompany such forward-looking statements, whether written or oral, expressly
qualify all of the forward-looking statements. In addition, the Company
disclaims any obligation to update any forward-looking statements after the date
of this release unless applicable securities laws require it to do so.
For a detailed discussion of these and other risk factors, interested parties
should review the Company's filings with the Securities and Exchange Commission,
including the Company's Form 10-K filed on January 13, 2003 and the Company's
Form 10-Q filed on February 13, 2003.
TRANSACTION SYSTEMS ARCHITECTS, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands)
March 31, September 30,
2003 2002
----------- -------------
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 91,408 $ 87,894
Marketable securities 3,183 3,757
Billed receivables, net 43,985 35,755
Accrued receivables 7,337 13,132
Prepaid income taxes 2,374 -
Deferred income taxes, net 10,599 17,554
Other 5,650 4,560
----------- ----------
Total current assets 164,536 162,652
Property and equipment, net 10,071 11,597
Software, net 3,116 5,609
Goodwill, net 56,387 55,947
Deferred income taxes, net 22,469 27,546
Other 2,681 3,168
----------- ----------
Total assets $ 259,260 $ 266,519
=========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of debt - financing
agreements $ 17,106 $ 18,444
Accounts payable 6,442 7,348
Accrued employee compensation 7,095 7,583
Accrued liabilities 8,669 11,494
Income taxes payable - 7,847
Deferred revenue 72,950 59,598
Other 764 872
----------- ----------
Total current liabilities 113,026 113,186
Debt - financing agreements 15,228 24,866
Deferred revenue 19,463 23,860
Other 1,519 1,749
----------- ----------
Total liabilities 149,236 163,661
----------- ----------
Stockholders' equity:
Class A Common Stock 183 183
Treasury stock, at cost (35,258) (35,258)
Additional paid-in capital 229,037 228,465
Accumulated deficit (76,862) (83,927)
Accumulated other comprehensive
loss, net (7,076) (6,605)
----------- ----------
Total stockholders' equity 110,024 102,858
----------- ----------
Total liabilities and
stockholders' equity $ 259,260 $ 266,519
=========== ==========
TRANSACTION SYSTEMS ARCHITECTS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited and in thousands, except per share amounts)
Three Months Ended Six Months Ended
March 31, March 31,
------------------------ ------------------------
2003 2002 2003 2002
---------- ---------- ---------- ----------
(Restated) (Restated)
Revenues:
Software license fees $ 38,167 $ 39,615 $ 69,497 $ 80,446
Maintenance fees 19,461 18,699 38,065 37,481
Services 11,622 12,923 24,177 26,547
---------- ---------- ---------- ----------
Total revenues 69,250 71,237 131,739 144,474
---------- ---------- ---------- ----------
Expenses:
Cost of software license fees 6,289 7,947 12,228 17,165
Cost of maintenance and services 15,693 16,375 30,501 32,413
Research and development 8,357 8,918 16,307 17,967
Selling and marketing 14,188 13,481 27,924 27,738
General and administrative 13,445 14,800 26,028 27,696
---------- ---------- ---------- ----------
Total expenses 57,972 61,521 112,988 122,979
---------- ---------- ---------- ----------
Operating income 11,278 9,716 18,751 21,495
---------- ---------- ---------- ----------
Other income (expense):
Interest income 285 329 595 640
Interest expense (787) (1,444) (1,743) (3,063)
Other, net 79 8,069 (1,060) 3,598
---------- ---------- ---------- ----------
Total other income (expense) (423) 6,954 (2,208) 1,175
---------- ---------- ---------- ----------
Income before income taxes 10,855 16,670 16,543 22,670
Income tax provision (6,785) (9,879) (9,478) (13,462)
---------- ---------- ---------- ----------
Net income $ 4,070 $ 6,791 $ 7,065 $ 9,208
========== ========== ========== ==========
Earnings per share information:
Weighted average shares outstanding:
Basic 35,486 35,299 35,462 35,277
========== ========== ========== ==========
Diluted 35,573 35,531 35,562 35,496
========== ========== ========== ==========
Earnings per share:
Basic $ 0.11 $ 0.19 $ 0.20 $ 0.26
========== ========== ========== ==========
Diluted $ 0.11 $ 0.19 $ 0.20 $ 0.26
========== ========== ========== ==========
-end-