CheckFree Posts Record Results for the First Quarter of Fiscal 2001.Business Editors ATLANTA--(BUSINESS WIRE)--Oct. 24, 2000 Electronic billing Electronic billing is the electronic delivery and presentation of financial statements, bills, invoices, and related information sent by a company to its customers. Electronic billing is also referred to as the following:
the quarter include relationships with 210 billers, nearly 250 Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the sites where consumers can view and pay bills, a run rate of 1.7 million bills distributed annually, eight percent sequential quarterly subscriber growth, and 20-plus percent growth in Internet-based subscribers CheckFree Corporation (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : CKFR CKFR Checkfree Corporation (stock abbreviation, AMEX) ) today announced revenues of $90.8 million for the first quarter ended September September: see month. 30, 2000 compared to $69.0 million for the same quarter of Fiscal 2000. Total revenues for the quarter increased 31 percent over the comparative quarter of last year. CheckFree reported a pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma loss for the quarter of $5.5 million, or nine cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. , excluding the impact of acquisition-related amortization and one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. charges. This compares to a pro forma loss of $2.4 million, or five cents per share, for the same period in fiscal 2000. Results include the effect of CheckFree's merger with TransPoint Transpoint Oy Ab is a Finnish freight logistics company. It is owned by VR Group (Finnish Railways) and is part of VR's Pohjolan Liikenne road services division. Transpoint trucks can be seen throughout Finland; trailer units are often carried around Finland by train. , which closed effective September 1, 2000. They do not reflect the Company's strategic alliance with Bank of America
Bank of America (NYSE: BAC TYO: 8648 ) is the largest commercial bank in the United States in terms of deposits, and the largest company of its kind in the world. . CheckFree Chairman and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. Pete Kight said, "I am very pleased with the progress we made this quarter in each of four areas vital to our accelerating market momentum this fiscal year: Bills on the Internet, sites where consumers can both receive and pay bills, co-marketing Co-marketing is a marketing practice where two companies cooperate with separate distribution channels, sometimes including profit sharing. It is frequently confused with Co-promotion See also Marketing co-operation efforts among billers and Consumer Service Providers, and continued enhancement of our core billing and payment transaction processing Updating the appropriate database records as soon as a transaction (order, payment, etc.) is entered into the computer. It may also imply that confirmations are sent at the same time. Transaction processing systems are the backbone of an organization because they update constantly. engine. "We closed the first quarter with 210 billers committed to CheckFree services, which includes 30 net-new billers from the closing of our merger with TransPoint, and is up from 157 billers signed by the close of fiscal 2000. Of these billers, 137 already make their bills available for payment on the Internet. Today consumers can go to nearly 250 Internet sites to receive and pay their bills, which is up from just under 200 sites at the close of last quarter. We are distributing bills at a run rate of 1.7 million annually, and our sequential quarterly subscriber growth was eight percent, at the high end of the six- to eight-percent range we expected. Importantly, Internet subscribers logged a seventh straight quarter at greater than 20 percent sequential growth," Kight continued. "Attaining 20 percent-plus Internet growth and eight percent overall growth in enrollments in the historically slow September quarter is strong performance." "We are working with financial information services See Information Systems. providers on marketing programs that combine incentives from them with incentives from billers to encourage consumers to sign up. We also are progressing on our plans to deliver a compelling set of next-generation payment services that have the unique value of being integrated with electronic billing and payment services offered by trusted financial services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. brands. Overall, we had another solid quarter executing toward achieving our goals," Kight added. Solid Performance on All Core Electronic Billing and Payment Metrics metrics Managed care A popular term for standards by which the quality of a product, service, or outcome of a particular form of Pt management is evaluated. See TQM. Significant accomplishments relevant to CheckFree's goal of continuing to lead and to accelerate the electronic billing and payment market include:
-- Nearly 250 sites are now live with full electronic billing and
payment, up from nearly 200 at the end of the fourth quarter
and compared to 53 at the close of the first quarter of fiscal
2000.
-- The Company added 53 billers in the first quarter, including 30
from TransPoint. This brings to 210 the total roster of bills
that will soon be available on the Internet, which is up from
157 at the close of the fourth quarter of fiscal 2000. One
hundred and thirty-seven of these bills are available on the
Internet today, 33 are actively being prepared for the Internet
and 40 are in the discovery, or planning, process. This is up
from 77 billers signed and 40 making their bills available on
the Internet at the close of the first quarter of fiscal 2000.
-- The number of bills distributed on the Internet in September
increased nearly 50 percent over bills distributed on the
Internet in June. CheckFree distributed about 140,000 bills on
the Internet in September, which equates to a run rate of 1.7
million bills per year. Bills gained through TransPoint are
included in this metric, but did not materially affect it.
-- First quarter sequential quarterly subscriber growth was eight
percent, bringing the total subscriber count at the end of the
quarter to 3.8 million. Subscriber additions from TransPoint are
included in, but did not contribute materially to, this total.
With the closing of the Bank of America strategic alliance,
effective October 1, approximately 300,000 existing Bank of
America subscribers have been transferred to CheckFree, lifting
the subscriber total to about 4.1 million.
-- Sequential quarterly growth of Internet-based subscribers in the
first quarter exceeded 20 percent. As of the close of the first
quarter, nearly half of CheckFree's subscriber base was using
Internet-based services.
-- The Company processed an all-time high of nearly 17 million
monthly transactions during the quarter, and achieved an
electronic rate in excess of 58 percent for each month of the
quarter.
TransPoint Merger Closes, Brings Relationships with Microsoft (Microsoft Corporation, Redmond, WA, www.microsoft.com) The most successful and influential software company. Microsoft's software and Intel's hardware pioneered the PC and revolutionized the computer industry. and First Data The merger between CheckFree and TransPoint closed effective September 1, 2000, bringing to CheckFree an exclusive five-year relationship with Microsoft to provide electronic billing and payment technology used in applications and services Microsoft develops. During that time, Microsoft will guarantee a minimum of $120 million in revenue to CheckFree. First Data has also entered into a five-year relationship with CheckFree, during which time CheckFree and First Data will market each other's services. First Data will provide at least $60 million in revenue and/or and/or conj. Used to indicate that either or both of the items connected by it are involved. Usage Note: And/or is widely used in legal and business writing. cost savings to CheckFree. Microsoft, First Data and Citibank CITIBANK First National City Bank , which was a minority investor in TransPoint, jointly received 17 million shares of CheckFree's Common Stock. "The integration of TransPoint into CheckFree's Electronic Commerce operations is progressing well," said Pete Sinisgalli, CheckFree's president and chief operating officer Chief Operating Officer (COO) The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. . "About half of the billers who had agreements with TransPoint also had agreements with CheckFree, and did not require extensive transition plans. Transition plans have been created for the 30 net new billers that became CheckFree customers through this merger," he added. Regarding the company's strategic alliance with Bank of America, Sinisgalli said, "our planned introduction of electronic billing and payment services to Bank of America's consumers continues right on track." Strong Division Performance CheckFree's Electronic Commerce division reported revenue of $63.0 million for the quarter, representing 32 percent growth over the same quarter of fiscal 2000. The division posted a pro forma operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. of $4.8 million, compared to a pro forma loss of $5.2 million for the first quarter of fiscal 2000. The division processed 58 percent of its billing and payment transactions electronically, contributing to high quality and efficiency levels. CheckFree Investment Services reported revenue of $15.7 million for the quarter, a 28 percent increase over the same quarter last year. Pro forma operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. for the quarter was $4.0 million, which represents an increase of 15 percent over the first quarter of fiscal 2000. During the quarter the division grew the number of portfolios under its management to more than one million, up 30 percent over portfolios managed at the close of the first quarter of fiscal 2000. The Company's Software businesses reported revenue in the quarter of $12.1 million, up 35 percent over revenue generated in the first quarter of fiscal 2000, including the Company's acquisition of BlueGill bluegill: see sunfish. bluegill Popular game fish (Lepomis macrochirus) and one of the best-known sunfishes throughout its original range, the freshwater habitats of the central and southern U.S. It has been introduced throughout the western U.S. Technologies, which now operates as part of CheckFree i-Solutions. The Software businesses reported a pro forma operating loss of $0.8 million for the quarter, as compared to pro forma operating income of $2.7 million in the first quarter of fiscal 2000, reflecting planned investments in i-Solutions. Second Quarter Expectations "We are forecasting revenues for the second quarter of fiscal 2001 to be in the range of $104 million to $109 million, with a pro forma loss per share of around seven to nine cents," said David Mangum, CheckFree's chief financial officer. "These expectations include the effects of the Company's merger with TransPoint, which closed in September, and our strategic alliance with Bank of America, which became effective October October: see month. 1, 2000," Mangum added. About CheckFree CheckFree Corporation is the leading provider of financial electronic commerce services, software and related products. Through its operating subsidiaries An operating subsidiary is a business term frequently used within the United States railroad industry. In the case of a railroad, it refers to a company that is a subsidiary but operates with its own identity and rolling stock. , CheckFree designs, develops and markets services that enable four million consumers to receive and pay bills over the Internet or electronically through a variety of bill aggregation points, including banks, brokerage firms, portals and interactive content sites on the Internet, and personal financial management (PFM) software. CheckFree's range of services and products are focused on enabling customers to receive electronic bills and statements, make electronic payments and collections, automate To turn a set of manual steps into an operation that goes by itself. See automation. paper-based recurring re·cur intr.v. re·curred, re·cur·ring, re·curs 1. To happen, come up, or show up again or repeatedly. 2. To return to one's attention or memory. 3. To return in thought or discourse. financial transactions and conduct secure Internet transactions. First Quarter Highlights September 28 - CheckFree shareholders approved the issuance of 10 million restricted shares of CheckFree Common Stock and performance-based warrants to purchase up to an additional 10 million shares of CheckFree Common Stock to Bank of America. September 19 - Sears, Roebuck and Company's approximately 60 million credit card customers will be able to view and pay their Sears bills online through their choice of CheckFree-powered Web sites. September 18 - CheckFree's client base of professional money managers and financial advisors is now running in excess of one million portfolios on the CheckFree APL (A Programming Language) A high-level mathematical programming language noted for its brevity and matrix generation capabilities. Developed by Kenneth Iverson in the mid-1960s, it runs on micros to mainframes and is often used to develop mathematical models. platforms. September 12 - EDS (Electronic Data Systems, Plano, TX, www.eds.com) Founded in 1962 by H. Ross Perot (independent candidate for the President of the U.S. in 1992), EDS is the largest outsourcing and data processing services organization in the country. announced it is adding electronic billing and payment capabilities from CheckFree i-Solutions, the leading provider of electronic billing and payment software and services, to its wide range of e-commerce e-commerce, commerce conducted over the Internet, most often via the World Wide Web. E-commerce can apply to purchases made through the Web or to business-to-business activities such as inventory transfers. solutions. September 7 - CheckFree named Pitney Bowes  This article or section is written like an .Please help [ rewrite this article] from a neutral point of view. Mark blatant advertising for , using . docSense as a Premier Certified See certification. Partner through its CheckFree Partner Certification Program. The Certification Program is designed to offer partner organizations CheckFree's leading distribution and payment systems as a complement to the partners' products and services. September 5 - CheckFree and TransPoint announced that the merger of the two companies has closed. On September 1, 2000, CheckFree shareholders approved the issuance of 17 million shares of CheckFree Common Stock in connection with the merger with TransPoint. The two companies announced their plans to merge in February February: see month. 2000. August 15 - CheckFree announced that it is providing electronic billing and payment to SBC (1) (SBC Communications Inc., San Antonio, TX, www.sbc.com) A large, national telecommunications company that grew from a multitude of local and regional companies, including Southwestern Bell, Pacific Bell and Nevada Bell, into a single, unified brand by 2002. Communications Inc. companies Pacific Bell and Southwestern Bell
Southwestern Bell Telephone, L.P. . Customers in California, Missouri California is a city in Moniteau County, Missouri, United States. The population was 4,005 at the 2000 census. It is the county seat of Moniteau CountyGR6. It is part of the Jefferson City, Missouri Metropolitan Statistical Area. , Oklahoma Oklahoma (ōkləhō`mə), state in SW United States. It is bordered by Missouri and Arkansas (E); Texas, partially across the Red R. (S, W); New Mexico, across the narrow edge of the Oklahoma Panhandle (W); and Colorado and Kansas (N). , Texas, Arkansas Arkansas, river, United States Arkansas (ärkăn`zəs, är`kənsô'), river, c.1,450 mi (2,330 km) long, rising in the Rocky Mts., central Colo. , and Kansas Kansas, state, United States Kansas (kăn`zəs), midwestern state occupying the center of the coterminous United States. It is bordered by Missouri (E), Oklahoma (S), Colorado (W), and Nebraska (N). can view and pay their monthly Pacific Bell and Southwestern Bell bills at their choice of CheckFree-powered web sites. August 2 - CheckFree announced that billserv.com is its first Premier Certified Partner through its Partner Certification Program. This program is designed to offer partner organizations CheckFree's leading distribution and payment systems as a complement to the partners' products and services. July July: see month. 31 - CheckFree and AT&T announced that AT&T's 60 million long distance customers can now view and pay their long distance phone bills online at their choice of CheckFree-powered web sites. July 27 - Yodlee Yodlee is a company that provides account aggregation and other online financial services. Yodlee allows users to see their credit card, bank, investment, email, travel reward accounts, etc. on one screen. .com and CheckFree announced an agreement that will enable users to experience the convenience of CheckFree's billing and payment services directly from Yodlee-powered services across the web. July 27 -- DocuCorp announced that electronic bill presentment and payment See EBPP. services are available for 155,000 residential and commercial members of Cobb Electric Membership Corporation (Cobb EMC (1) (EMC Corporation, Hopkinton, MA, www.emc.com) The leading supplier of storage products for midrange computers and mainframes. Founded in 1979 by Richard J. Egan and Roger Marino, EMC has developed advanced storage and retrieval technologies for the world's largest companies. ) of Marietta Marietta (mârēĕt`ə). 1 City (1990 pop. 44,129), seat of Cobb co., NW Ga.; inc. 1834. The principal manufactures of this suburb of Atlanta are related to aircraft production. At the foot of Kennesaw Mt. , GA. July 24 -- Reliant Energy's (NYSE NYSE See: New York Stock Exchange : REI) 1.6 million electric and natural gas customers in the Houston Houston, city (1990 pop. 1,630,553), seat of Harris co., SE Tex., a deepwater port on the Houston Ship Channel; inc. 1837. Economy The fourth largest city in the nation and the largest in the entire South and Southwest, Houston is a port of entry; area can eliminate their paper bills by viewing and paying their bills online at www.reliantenergy.com. July 17 - Phillips Phil·lips A trademark used for a screw with a head having two intersecting perpendicular slots and for a screwdriver with a tip shaped to fit into these slots. 66 credit card holders can now access their statements and pay their accounts online. July 13 - CheckFree and APS, Arizona's largest electric utility, announced an agreement to make electronic billing and payment available to APS customers. July 12 - CheckFree will incorporate the Equifax  This article is subject to manipulation attempts by the described entity using multiple user names. Please be critical of edits and discussion page entries.Equifax, Inc. Secure authentication See authentication token and SecurID card. engine into its electronic and billing payment enrollment process to more quickly and securely verify (1) To prove the correctness of data. (2) In data entry operations, to compare the keystrokes of a second operator with the data entered by the first operator to ensure that the data were typed in accurately. See validate. customer identity when signing up for service to view and pay bills electronically. July 11 -Internet infrastructure developer 724 Solutions and CheckFree agreed to make electronic billing and payment over wireless devices available to financial institutions that use CheckFree and the 724 Solutions Financial Services Platform. July 10 - TIAA-CREF TIAA-CREF Teachers Insurance and Annuity Association - College Retirement Equities Fund has selected CheckFree RECON-Plus for Windows to support daily account reconciliation for its growing transaction volume base. This press release contains statements that are not purely historical, and as such are forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. under the federal securities laws. These include forward-looking statements regarding management's intentions, plans, hopes, beliefs, expectations or projections of the future, and include statements in this document regarding: expectations from the relationship with Bank of America (paragraph 15) and financial expectations for the second quarter of fiscal 2001 (paragraph 19). These forward-looking statements involve risks and uncertainties, including without limitation, whether the planned technology developments will be successful and accepted by the Company's customers; whether the Company can deliver its services at the pace demanded by the marketplace; whether consumers will sign up for and use the Company's services when and as expected; whether the Company's customers, particularly financial institutions and Internet portals, timely announce, actively offer and aggressively market such services to their clients and users; whether the Company's business and market assumptions supporting its current revenue and earnings projections will prove to be accurate; and the various risks inherent in the Company's business and other risks and uncertainties detailed from time to time in the Company's periodic reports filed with the Securities and Exchange Commission, including the Company's Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ended June June: see month. 30, 2000 (filed September 26, 2000). One or more of these factors have affected, and could in the future affect, the Company's business and financial results in future periods, and could cause actual results to differ materially from plans and projections. There can be no assurance that the forward-looking statements made in this press release will prove to be accurate, and issuance of such forward-looking statements should not be regarded as a representation by the Company, or any other person, that the objectives and plans of the Company will be achieved. All forward-looking statements made in this press release are based on information presently available to management, and the Company assumes no obligation to update any forward-looking statements.
CHECKFREE CORPORATION AND SUBSIDIARIES
Consolidated Condensed Statements of Operations
(Unaudited)
(In thousands, except per share data)
Three months ended September 30,
-------------------------------------
1999 2000
----------- -----------
Revenues:
Processing and servicing $ 58,304 $ 76,159
License fees 2,996 5,047
Maintenance fees 4,438 4,647
Other 3,282 4,904
----------- -----------
Total Revenues 69,020 90,757
Expenses:
Cost of processing, servicing
and support 42,993 53,072
Research and development 6,824 13,918
Sales, marketing and royalties 8,668 14,304
General and administrative 9,924 11,492
Depreciation and amortization 6,976 55,734
In process research and development - 18,600
----------- -----------
Total Expenses 75,385 167,120
----------- -----------
Loss from operations (6,365) (76,363)
Interest, net 245 325
----------- -----------
Loss before income taxes (6,120) (76,038)
Income tax benefit (2,184) (17,680)
----------- -----------
Net loss $ (3,936) $ (58,358)
=========== ===========
Basic loss per share:
Net loss per common share $ (0.08) $ (0.91)
=========== ===========
Equivalent number of shares 51,848 64,216
=========== ===========
Diluted loss per share:
Net loss per common share $ (0.08) $ (0.91)
=========== ===========
Equivalent number of shares 51,848 64,216
=========== ===========
CHECKFREE CORPORATION AND SUBSIDIARIES
Supplemental Pro Forma Consolidated Condensed Statements of Operations
(Unaudited)
(In thousands, except per share data)
Three months ended September 30,
-------------------------------------
1999 2000
----------- -----------
Revenues:
Processing and servicing $ 58,304 $ 76,159
License fees 2,996 5,047
Maintenance fees 4,438 4,647
Other 3,282 4,904
----------- -----------
Total Revenues 69,020 90,757
Expenses:
Cost of processing, servicing
and support 42,993 53,072
Research and development 6,824 13,918
Sales, marketing and royalties 8,668 14,304
General and administrative 9,924 11,492
Depreciation and amortization 5,003 7,833
----------- -----------
Total Expenses 73,412 100,619
----------- -----------
Pro forma loss from operations (4,392) (9,862)
Interest, net 245 325
----------- -----------
Pro forma loss before income taxes (4,147) (9,537)
Income tax benefit (1,714) (4,006)
----------- -----------
Pro forma net loss $ (2,433) $ (5,531)
=========== ===========
Basic pro forma loss per share:
Pro forma net loss per common
share $ (0.05) $ (0.09)
=========== ===========
Equivalent number of shares 51,848 64,216
=========== ===========
Diluted pro forma loss per share:
Pro forma net loss per common
share $ (0.05) $ (0.09)
=========== ===========
Equivalent number of shares 51,848 64,216
=========== ===========
This supplemental pro forma statement of operations for the three
months ended September 30, 1999 and 2000 is for illustrative purposes
only and is not prepared in accordance with generally accepted
accounting principles. It presents the operating results of the
Company, excluding acquisition related charges of $2.0 million for the
three months ended September 30, 1999, which represents intangible
asset amortization, and of $66.5 million for the three months ended
September 30, 2000, which represents $47.9 million of intangible asset
amortization and $18.6 million of in-process research and development
charges. The tax benefit in both periods has been adjusted for the
impact of deductible intangible asset amortization at a marginal rate
of 40%.
CHECKFREE CORPORATION AND SUBSIDIARIES
Consolidated Condensed Balance Sheets
(Unaudited)
(In thousands)
June 30, September 30,
2000 2000
------------ --------------
Current assets:
Cash, cash equivalents, and
investments $ 184,622 $ 289,184
Accounts receivable, net 58,308 65,632
Other current assets 22,546 16,767
------------ -------------
Total current assets 265,476 371,583
Property and equipment, net 93,214 93,444
Capitalized software and
intangible assets, net 288,469 1,786,889
Deferred income taxes 29,248 -
Investments 23,003 23,923
Other 13,704 12,212
------------ -------------
Total assets $ 713,114 $ 2,288,051
============ ==============
Current liabilities:
Accounts payable, accrued
liabilities and other $ 60,071 $ 64,397
Deferred revenues 26,644 35,929
------------ -------------
Total current liabilites 86,715 100,326
Accrued rent and other 7,269 6,826
Deferred income taxes - 252,725
Long-term obligations - less
current portion 736 682
Convertible subordinated notes 172,500 172,500
Net stockholders' equity 445,894 1,754,992
------------ -------------
Total liabilities and
stockholders' equity $ 713,114 $ 2,288,051
============ =============
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