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Trintech Reports First Quarter Fiscal Year 2011 Financial Results

  • Revenues of $8.5 million, Adjusted EBITDA Net Income from continuing operations of $1 million and Net Income of $22.4 million


Dublin, Ireland | Dallas, TX - May 25, 2010

Trintech Group Plc (NASDAQ: TTPA), a leading provider of integrated financial governance, risk management and compliance (GRC) solutions for commercial, financial and healthcare markets, today announced its first quarter 2011 financial results. Following the sale of its healthcare business to The Advisory Board Company on April 1, 2010, Trintech is required to present its financial results on a continuing and discontinued basis. This requirement has resulted in the presentation of financial results showing first quarter revenues for the continuing business (the Financial Governance, Risk and Compliance or Financial GRC business) of $8.5 million and adjusted EBITDA net income for the continuing business of $1 million. The net income in the quarter for the continuing business amounted to $482,000 and the net income for the continuing and discontinued businesses amounted to $22.4 million, which included a gain on sale of the healthcare business of $21.8 million.

Highlights:

Cyril McGuire, Chairman and Chief Executive Officer said, "Our performance in Q1 of the 2011 fiscal year was strong with impressive business momentum building in our continuing operations in the Financial GRC market. Revenue grew robustly by over 9% in the first quarter due to new client wins and greater customer confidence in technology spending, with impressive growth in adjusted EBITDA net income of over $1.0 million representing 30% growth over the prior year. Net income of $22.4 million was achieved in the quarter following the successful sale of our healthcare business which was completed on April 1, 2010. Operating performance metrics continued to improve with margin expansion and cash generation exceeding our internal targets. We also boosted our investments in product development by 11% and sales and marketing activities by 15% in the quarter to deliver new innovative products and services to our growing client base in the Financial GRC market. Our outlook is positive as we create a more strategically focused Trintech in the expanding Financial GRC market which is well positioned for revenue and earnings growth as the broader global economy continues its recovery."

Paul Byrne, President, added, "Trintech continues to deliver robust revenue and profit growth through an extremely productive and highly skilled organization. This success will continue to be underpinned by the on-going need for corporate organizations to improve financial transparency and efficiency as they rebuild after the economic downturn. In addition, the evolution of and growth in corporate and financial regulation and demand for greater visibility of risk and compliance by company boards has, we believe, the potential to further accelerate demand for Trintech's financial GRC platform."

Recent Highlights include:

Results Overview:

Revenues from continuing operations for the first quarter ended April 30, 2010 increased by 9% to $8.5 million compared to $7.7 million for the corresponding quarter in the prior year.

Software license revenues from continuing operations for the first quarter ended April 30, 2010 were $5.4 million compared to $4.8 million for the quarter ended April 30, 2009, representing growth of 12%. The growth was primarily due to increased new license business which grew by almost 30% compared to Q1 of the prior year.

Service revenues from continuing operations for the quarter ended April 30, 2010 were $3.1 million compared to $2.9 million for the quarter ended April 30, 2009, representing growth of 6%. The growth was primarily due to an increase in professional service revenues from our GRC business from our ReconNET and Unity products.

Total gross margin from continuing operations for the quarter ended April 30, 2010 was $6.2 million, an increase of 12% from $5.6 million for the quarter ended April 30, 2009. The overall gross margin percentage from continuing operations increased by 2% in Q1 of the 2011 fiscal year to 74% from 72% in Q1 of the 2010 fiscal year. The increase in gross margin was due to an increase in license revenue. The increase in gross margin percentage in Q1 of the 2011 fiscal year was due to an increase in service margin caused by improved utilization of staff compared to Q1 of the 2010 fiscal year.

Total operating expenses from continuing operations for the quarter ended April 30, 2010 were $5.7 million, an increase of 2% from $5.6 million in the corresponding quarter in the prior year. Adjusted EBITDA operating expenses from continuing operations for the quarter ended April 30, 2010 were $5.4 million, an increase of 9% from $4.9 million for the corresponding period in the prior year. The increase was largely due to an additional use of engineering contractors on product development, sales and marketing costs and travel due to increased sales activity.

The provision for income taxes from continuing operations was $97,000 for Q1 of the fiscal 2011 compared to $36,000 for the corresponding period in the prior year arising primarily from state taxes in the US and tax on interest income in Ireland.

Trintech's balance sheet is substantially stronger than at January 31, 2010 with cash balances of $47.6 million as of April 30, 2010. The cash flow statement has been prepared on a combined continuing and discontinued basis. Net cash generated for the three months ended April 30, 2010 was $27.7 million, which included net proceeds from the sale of the healthcare business of $26.7 million, cash generated from operations of $826,000, proceeds from the issuance of ordinary shares of $228,000, a decrease in restricted deposits of $170,000, payments on the purchase of property and equipment of $155,000, capital lease payments of $49,000 and the negative effect of exchange rate differences on cash and cash equivalents of $68,000.

Trintech will host a conference call to discuss its financial results and its business outlook at 15:30hrs (UK Time), Wednesday, May 26. Please see advisory for information on the call.

A web simulcast of Trintech's conference call reviewing our performance for Q1 fiscal year 2011 and our business outlook for Q2 fiscal year 2011 will be broadcast live, Wednesday, May 26, 2010 at 15:30 hrs (UK Time), 10:30 hrs (NY Time) and 07:30 hrs (CA Time) and thereafter for 1 year at 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 (57225731 #).

Please click here to read the full version of this release.

About Trintech Group

Trintech Group Plc (NASDAQ: TTPA) is a leading global provider of integrated financial governance, risk management and compliance (GRC) software solutions for commercial, financial, and healthcare markets. Trintech's recognized expertise in reconciliation process management, financial data aggregation, financial close and reporting, risk management, and compliance enables customers to gain greater visibility and control of their financial processes leading to better overall business performance.

For more information on how Trintech can help you increase confidence in business performance and reduce financial risk, please contact us online at 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 business momentum in our continuing operations, our business outlook and our position for revenue and earnings growth, the expansion of the Financial GRC market, the needs of corporate organizations to improve financial transparency and efficiency and the impact of the evolution of and growth in corporate and financial regulation and demand for greater visibility of risk and compliance by company boards on the demand for our financial GRC platform. Factors that could cause or contribute to such differences include Trintech's ability to accurately predict future sales and market trends, accurately predict and meet customer needs and to successfully position itself in the market, ensure the performance of its products and services, and 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, 2010 filed with the US Securities and Exchange Commission (www.sec.gov) and subsequent filings with the US Securities and Exchange Commission. Lastly, Trintech assumes no obligation to update these forward-looking statements.

Trintech Press Contact

Paul Byrne, President
paul.byrne@www.trintech.com

Joseph Seery, VP Finance, Group
joseph.seery@www.trintech.com

Trintech Group plc
+353 1 293 9840

Published Tuesday, May 25th, 2010 and filed under Corporate - Earnings