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VERIFONE ANNOUNCES SECOND QUARTER RESULTS: EARNINGS UP 30 PERCENT ON $58.7 MILLION REVENUES

 VERIFONE ANNOUNCES SECOND QUARTER RESULTS:
 EARNINGS UP 30 PERCENT ON $58.7 MILLION REVENUES
 REDWOOD CITY, Calif., July 28 /PRNewswire/ -- VeriFone Inc. (NASDAQ: VFIC), a leading supplier of Transaction Automation systems and solutions worldwide, today announced earnings per share of 26 cents for the second quarter ended July 3, 1992. This represents a 30.0 percent increase over the same period a year ago, despite a 3.4 percent increase in shares outstanding. Net income was $6.1 million, up 32.3 percent compared to the same quarter of 1991.
 Revenue for the quarter reached a record $58.7 million, a 23.8 percent improvement over the $47.4 million reported in the year- earlier period.
 Operating income, or earnings before interest and taxes, rose 35.3 percent to $8.2 million or 14.0 percent of revenue. Research and development was 12.6 percent of revenue, down from 13.0 percent a year ago. Selling, general, and administrative expenses totaled 24.8 percent of revenue, down 1 percentage point from the same period in 1991.
 "Second-quarter milestones in revenue and profitability reflect the broad base of our business, which is growing geographically, horizontally, and vertically," said Hatim Tyabji, VeriFone president and chief executive officer. "This breadth provides consistency and balance, in that strength in certain market segments tends to offset temporary weakness in others. Within that context, we continue to see strong momentum in emerging markets and sustained resiliency in our financial business."
 International revenue grew by 85.3 percent over the same period last year and contributed 23.2 percent of the company's total quarterly revenue. The Europe, Middle East, Africa, and Asia-Pacific regions posted record revenues, underscoring the growing acceptance of VeriFone's Transaction Automation systems worldwide. VeriFone systems are now certified and installed in 68 countries.
 Sales in the United States made strong gains, exemplified by the petroleum/convenience-store market, which grew 65.9 percent over a year ago. Multi-lane retail increased 30.0 percent over the year-ago period, and the emerging healthcare and government benefits markets together contributed 6.4 percent of total revenue versus less than 1 percent last year. These increases combined to more than offset a 3.7-percent decline in the financial retail segment, which was due to reduced shipments to larger independent sales organizations (ISOs) and strong sales in the year-ago quarter. This segment accounted for 52.3 percent of the company's total revenue, compared with 67.2 percent in the year- earlier period, reflecting increasing revenue contributions from emerging markets.
 At July 3, 1992, the company's cash and short-term investments were $72.9 million, down slightly from December levels. Accounts receivable increased to $55.9 million, up 44.3 percent over year-end levels, because of increased sales, particularly to international markets, and increased utilization of trade credit outside the United States. Despite growth in revenue, inventories declined nearly $5 million during the first half of 1992, showing improved turnover. The Company
 VeriFone Inc., based in Redwood City, is a leading global provider of Transaction Automation solutions used to deliver payment processing and other transaction services to the retail, healthcare and government markets. The company has more than 30 facilities -- including regional offices, development centers, and manufacturing and distribution centers--located throughout the United States and in or near Frankfurt; London; Madrid; Paris; Singapore; Sydney; Taipei and Kaohsiung, Taiwan, R.O.C.; and Bangalore, India. To date, VeriFone has shipped more than 2.4 million Transaction Automation systems, which have been installed in 68 countries. The company's 1991 revenues totaled $187.9 million. VeriFone was recently named one of America's 100 fastest-growing companies by Fortune and one of the 200 best small companies by Forbes.
 VeriFone
 CONDENSED CONSOLIDATED STATEMENTS OF INCOME
 (Unaudited dollars in thousands except per share data)
 Three Months Ended Six Months Ended
 July 3, June 28, July 3, June 28,
 1992 1991 1992 1991
 Net revenues $ 58,701 $ 47,420 $ 105,581 $ 84,924
 Costs and expenses:
 Cost of revenues 28,480 22,868 50,783 41,241
 Research and
 development 7,417 6,188 13,564 11,823
 Selling, general
 and administrative 14,570 12,279 28,697 22,645
 Total costs and
 expenses 50,467 41,335 93,044 75,709
 Income from
 operations 8,234 6,085 12,537 9,215
 Interest income, net 577 826 1,349 1,741
 Income before income
 taxes 8,811 6,911 13,886 10,956
 Provision for income
 taxes 2,731 2,315 4,304 3,670
 Net income $ 6,080 $ 4,596 $ 9,582 $7,286
 Net income per
 share $ 0.26 $ 0.20 $ 0.41 $ 0.32
 Common and common
 equivalent shares
 used in computing
 per share amounts 23,575 22,792 23,609 22,780
 CONDENSED CONSOLIDATED BALANCE SHEET (Dollars in thousands)
 July 3, 1992 Jan. 3, 1992
 (Unaudited)
 ASSETS
 Current assets:
 Cash and cash equivalents $ 24,450 $23,102
 Short-term investments 48,443 50,922
 Accounts receivable, net 55,904 38,743
 Other receivables 5,819 2,771
 Inventories 31,096 36,052
 Prepaid expenses 1,526 1,102
 Total current assets 167,238 152,692
 Property, plant and equipment,
 net 25,735 24,793
 Other assets, net 11,403 11,409
 TOTAL ASSETS $ 204,376 $ 188,894
 LIABILITIES AND STOCKHOLDERS' EQUITY
 Current liabilities:
 Notes payable $ 1,028 $ 489
 Accounts payable 11,140 13,240
 Accrued compensation 5,311 5,321
 Other accrued liabilities 6,682 5,895
 Income taxes payable 5,318 1,629
 Deferred revenue 5,031 3,848
 Long-term debt, including
 capital lease obligations 800 743
 Total current liabilities 35,310 31,165
 Long-term debt, including capital
 lease obligations less
 current portion 2,263 2,382
 Deferred income taxes 11,906 11,276
 Stockholders' equity 154,897 144,071
 TOTAL LIABILITIES AND
 STOCKHOLDERS' EQUITY $ 204,376 $ 188,894
 -0- 7/28/92
 /CONTACT: Thomas W. Hubbs, 415-598-5548; or Tod Bottari, 415-598-5570, both of VeriFone/
 (VFIC) CO: VeriFone ST: California IN: TLS SU: ERN


RM-MM -- SJ001 -- 4185 07/28/92 15:01 EDT
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