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EXHIBIT 99.1
Tuesday February 13, 4:32 pm Eastern Time
Press Release
SOURCE: S1 Corporation
S1 Corporation Reports Fourth Quarter and Year End 2000 Results;
Revenue and EBITDA Loss Per Share in Line with Expectations
ATLANTA, Feb. 13 /PRNewswire/ -- S1 Corporation (Nasdaq: SONE - news), a leading
provider of Internet-based solutions for the financial services industry,
reported revenues of $60.1 million for the quarter ended December 31, 2000, a
49% increase from $40.4 million recorded for the quarter ended December 31,
1999. Revenues for the year ended December 31, 2000 were $233.9 million, a 152%
increase over annual revenues of $92.9 million for the year ended December 31,
1999. Excluding merger-related and certain non-cash charges, the Company posted
an EBITDA (earnings before interest, taxes, depreciation and amortization) loss
of $27.9 million, or $0.50 per share. The EBITDA loss for the year 2000 was
$72.9 million as compared with a 1999 EBITDA loss of $10.3 million.
"The fourth quarter results we are announcing today reflect the impact of a
number of initiatives we have undertaken to introduce greater operational
efficiencies into the business and more effectively position ourselves and our
customers for long-term success," said Jaime Ellertson, chief executive officer,
S1 Corporation. "The steps we've taken are part of a clear, aggressive action
plan to focus our strengths on high-potential opportunities within our core
business units. This new sharper focus, combined with our clear market
leadership position in the eFinance space, will be instrumental to meeting our
strategic business objectives, including reaching EBITDA profitability during
2001."
During the fourth quarter of 2000, S1's financial results were impacted by a
number of one-time events, including:
- - the announced sunsetting of the Edify Retail Banking platform, which
impacted both revenue and expense during the period for a net negative
impact of approximately $6 million;
- - the consolidation of technology platforms and worldwide systems, resulting
in $3 million in additional expense;
- - the announced merger of VerticalOne, an S1 subsidiary, with Yodlee, which
impacted both revenue and expense during the period for a net negative
impact of approximately $2 million;
- - the opening of a new data center in EMEA, resulting in an incremental $1.5
million in expense;
- - the hiring of a new chief executive officer and other senior executives,
and other miscellaneous changes in organizational structure, resulting in
approximately $1.5 million in additional costs.
Software licenses revenues in the fourth quarter were $11.1 million, a decline
of 9% compared with the prior year quarter, and were $51.7 million for the year
ended 2000, up 172% over 1999. Professional services revenues were $40.6 million
in the fourth quarter 2000, a 77% increase over the prior year quarter, and
totaled $154.4 million for the full-year 2000, or 174% over the year ended
December 31, 1999.
Data Center revenues of $8.2 million in the fourth quarter were 156% above the
level recorded during the same period last year. Data Center revenues for the
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year ended December 31, 2000 were $22.8 million, a 158% increase over full-year
1999 revenues. At year-end 2000, the total number of end users was 775,000.
The Company's gross margin for the fourth quarter 2000 was $22.9 million,
representing a gross margin percentage of 38%, down from 46% in the fourth
quarter 1999 and 46% in the immediate prior quarter. Gross margin for the
full-year 2000 was $95.3 million, representing a gross margin percentage of 41%.
In the fourth quarter 2000, S1 incurred a net loss of $813.4 million, or $14.45
per share, compared to a net loss of $117.0 million, or $3.05 per share, for the
fourth quarter 1999. The 2000 loss included the effect of a one-time non-cash
charge in the amount of $778.4 million related to the impairment of certain
acquisition-related intangibles. For the year ended December 31, 2000, S1
incurred a net loss of $1.1777 billion, or $22.07 per share, compared to a net
loss of $125.1 million, or $4.28 per share, for the year ended December 31,
1999. The annual results included non-cash amortization of acquisition-related
intangibles in the amount of $1.080 billion in 2000 and $40.2 million in 1999.
"As a result of a continued decline in the market, certain acquisition- related
intangible assets were deemed to have become impaired, resulting in a one-time
charge to earnings," said Robert Stockwell, chief financial officer, S1
Corporation. "In addition, we took a number of restructuring charges as a result
of key strategic initiatives implemented during the quarter. The overwhelming
majority of these items have no impact on our cash position. We believe that as
a result of the non-cash charges we have taken in the fourth quarter, S1's
reported results going forward will be more clearly representative of the true
financial position of the Company."
Financial Guidance
In Q1 2001 the Company expects revenues in the range of $60-$63 million. Total
annual revenue projections are in the range of $275-$285 million. The Company
remains committed to its previously stated goal of reaching EBITDA profitability
in 2001.
Conference Call Information
Mr. Ellertson will host a conference call this afternoon at 5:00 p.m. EST. The
call may be accessed via the Internet at
http://www.vcall.com/NASApp/Vcall/EventPage?ID=66920 . The call will be recorded
and available for play back by dialing (888) 203-1112 (US & Canada) or (719)
457-0820 (International). The access code is 517451. The replay will be active
until midnight EST on February 20, 2001.
About S1 Corporation
S1, the pioneer of Internet banking, is a leading global provider of innovative
eFinance solutions and services that are centered on banking, brokerage and
insurance. S1 is enabling financial service providers to create a complete
Enterprise eFinance Experience(TM) by delivering the tools necessary to meet the
evolving demands of their customers across various lines of businesses, market
segments and delivery channels. Through its Open eFinance Architecture(TM), S1
offers a broad range of applications that empower financial institutions to
increase revenue, strengthen customer relationships and gain competitive
advantage. Additionally, through the Company's professional services
organization, S1 applications can be
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implemented in-house or hosted in an S1 Data Center. Additional information
about S1 is available at http://www.s1.com .
Forward-Looking Statements
This press release includes statements and other matters which are
forward-looking and subject to a number of risks and uncertainties that could
cause actual results to differ materially from expectations. The statements
contained in this release that are forward-looking are based on current
expectations and are subject to risks and uncertainties that could cause actual
results to differ materially from the results contemplated by the
forward-looking statements. These risks and uncertainties include, but are in no
way limited to:
- the possibility that the anticipated benefits from our acquisition
transactions will not be fully realized;
- the possibility that costs or difficulties related to our integration of
acquisitions will be greater than expected;
- our dependence on the timely development, introduction and customers
acceptance of new internet services;
- rapidly changing technology and shifting demand requirements and internet
usage patterns;
- other risks and uncertainties, including the impact of competitive
services, products and prices, the unsettled conditions in the internet
and other high-technology industries and the ability to attract and retain
key personnel; and
- other risk factors as may be detailed from time to time in our public
announcements and filings with the SEC, including the Company's annual
report on Form 10-K for the year ended December 31, 1999.
Except as required by law, S1 will not update forward-looking statements over
the course of future periods.
S1 Corporation
Selected Financial Data*
(In thousands, except share, per share and end-user data)
Three Months Ended Twelve Months Ended
December 31, December 31,
2000 1999 2000 1999
Revenues:
Software licenses $ 11,102 $ 12,152 $ 51,737 $ 19,050
Professional services 40,629 23,030 154,447 56,432
Data center 8,198 3,195 22,811 8,858
Other 127 2,039 4,893 8,550
Total revenues 60,056 40,416 233,888 92,890
Direct costs:
Software licenses 673 311 4,556 642
Professional services 29,135 16,461 109,355 36,327
Data center 7,298 3,129 20,371 9,008
Other 85 2,010 4,305 7,112
Total direct
costs 37,191 21,911 138,587 53,089
Gross margin 22,865 18,505 95,301 39,801
Operating expenses:
Selling and marketing 16,251 8,763 54,719 12,169
Product development 21,054 10,055 68,800 24,036
General and
administrative 14,698 6,928 45,850 13,913
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Depreciation and
amortization 9,822 2,998 25,891 6,924
Stock option
compensation expense 1,326 797 5,383 1,118
Marketing cost from
warrant issued --- 715 4,962 715
Merger related and
restructuring costs 19,015 6,643 37,228 8,744
Acquired in-process
research and development --- 59,300 14,100 59,300
Amortization and
impairment of
acquisition intangibles 778,448 40,000 1,080,321 40,206
Total operating
expenses 860,614 136,199 1,337,254 167,125
Operating loss (837,749) (117,694) (1,241,953) (127,324)
Interest, investment and
other income 19,799 706 59,699 2,237
Income tax benefit 4,576 --- 4,576 ---
Net loss $ (813,374) $ (116,988) $(1,177,678) $ (125,087)
EDITDA(1) (27,922) (7,241) (72,846) (10,317)
EBITDA per common share(1) (0.50) (0.19) (1.37) (0.35)
Loss per common share from
depreciation,
amortization, (13.95) (2.86) (20.70) (3.93)
other charges and interest
and investment income
Net loss per common share $ (14.45) $ (3.05) $ (22.07) $ (4.28)
Gross Margin %
Software licenses 94% 97% 91% 97%
Professional services 28% 29% 29% 36%
Data Center 11% 2% 11% -2%
Other 33% 1% 12% 17%
Total Gross Margins 38% 46% 41% 43%
Weighted average common
shares outstanding 56,291,655 38,339,221 53,359,206 29,227,732
Common shares outstanding
at end of period 57,965,770 48,831,243 57,965,770 48,831,243
December 31,
2000 1999
Cash and investment securities 172,128 130,604
Accounts receivable, net 97,800 70,136
Deferred Income 31,006 29,752
(1) Excludes merger related costs, stock option compensation expense,
acquired in-process research and development, non-cash marketing expense
and other charges from changes in the organizational structure.
SOURCE: S1 Corporation
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/CONTACT: Sam Perkins, Vice President, Investor Relations, 404-812-6671, or
sam.perkins@s1.com, or Julie Carlyle, 404-812-6646, or
julie.carlyle@s1.com , both of S1 Corporation/
/Web site: http://www.s1.com /
(SONE)