Canadian-based Orion Technologies said it will launch a cobranded VISA or MasterCard in conjunction with its new global, private label ‘A-Net Card Program’. The ‘A-Net’ card was selected last week as the official ‘ATM/Debit Card’ for The Association of Development Financing Institutions in Asia and the Pacific. The group has 79 bank members in 33 Asian Pacific countries. The company was recently approved to be a blockholder of 94 ANSI ‘Issuer Identifier Numbers’.Details
Paymentech, Inc. announced several new customers that expanded the credit card processor’s presence in the ticketing industry during 1997. The announcement was made during the International Ticketing Association’s (INTIX) 19th Annual Conference in Washington, DC.
The nation’s third largest electronic payment processor also showcased SE Workstation at the INTIX exhibition. SE Workstation is the first PC based application that enables merchants to electronically access both American Express and bankcard financial reporting.
Paymentech signed several prestigious organizations including The New York Philaharmonic at Lincoln Center and Disney’s New Amsterdam Theater in Times Square. Paymentech will provide credit card payment processing and settlement for the two organizations. With the addition of The New York Philaharmonic, Paymentech now processes credit card ticket sales for all regularly performing groups at Lincoln Center.
“Paymentech had the experience and familiarity with the box office ticketing environment that we desired in a credit card processor,” said Pamela Katz, controller for The New York Philaharmonic.
“We program a variety of dial-up terminal products to be compatible with the different ticketing systems,” said Gary T. Staub, group executive for business development at Paymentech. “This supports our strong customer base in the ticketing industry.” Staub cited such clients as the New York and Los Angeles Nederlander Theaters, Carnegie Hall, Dallas Symphony, Atlanta’s High Museum and Alliance Theatre, and the Tampa Bay Performing Arts Center.
Paymentech also introduced the enhanced version of SE Workstation to the ticketing industry, particularly appropriate for high volume sites such as stadiums and arenas. Developed by American Express and Paymentech, this Windows-based programs allows merchants to receive and respond on-line to cardholder inquiries.
SE Workstation is unique in that it allows box office administration to look up both American Express and bankcard transactions from the same program. “Adding bankcard data access will improve a merchant’s ability to quickly handle chargeback issues,” said Staub.
Paymentech, Inc. founded in 1985, provides full-service electronic payment solutions for direct merchant clients as well as third-party transaction processing. Paymentech also offers complete commercial card payment and information solutions. Paymentech is the third largest processor of bankcard transactions in the United States and a leading issuer of commercial cards.Details
Three major banks have begun pilot programs using the Integrion Financial Network electronic banking platform via the Internet. PNC, First Chicago/NBD and Michigan National are conducting transactional tests of IFS this quarter with plans to expand to retail customers later this year. The three institutions join NationsBank and Banc One who already offer online banking via IFS. Integrion said yesterday that eight more banks are planning IFS implementations this year including Mellon and Royal Bank of Canada.Details
Betting Inc. announced that it will purchase the Pay Master terminal from Shop While You Wait, the joint venture between Smoky Mountain Technologies Inc. and ET&T that was formed to market an electronic shopping service for retail and waiting room locations.
Betting Inc. will participate in the multimillion dollar venture between Smoky Mountain Technologies Inc., a UNICOMP subsidiary (Nasdaq UCMP), and Electronic Transactions and Technologies to pursue self service electronic commerce.
“Shop While You Wait (SWYW) is giving us an excellent price for the Pay Master,” stated Tom Hughes, Betting Inc. Chairman and CEO. “We have had substantial interest from parties who presently receive legal home off track betting by credit card, and would like to replace that with same as cash, ATM cards with PIN transactions through the Pay Master calling out by modem not voice, over a regular phone line. This is real money, the same as cash for the gaming service companies, and they can realize additional significant savings by processing electronic orders rather than voice calls.”
The Pay Master terminal includes a card reader for both mag strip and smart card, alpha numeric keypad, alpha numeric display and printer. It is designed for self-service electronic orders not voice calls.
The business of Betting Inc. is to act as an interface between consumers using their ATM card and bank assigned PIN to send personal encrypted remote financial electronic transactions (PERFECT) to the gaming industry.
Betting Inc. processes these transactions and is also developing the Patented Second Line Computer Keyboard to bypass the Internet with PERFECT activity.Details
The renowned Nicklaus/Flick Golf School will launch its 1998 Touring Programs with three unique instructional programs for Atlanta-area golfers at the Cherokee Run Golf Club
— The Total Game Tour, a three-day program focusing on the areas of golf instruction, nutrition and mental and physical preparation. Classes will be April 17-19 and April 24-26.
— Faults & Cures presented by Visa, a one-day program designed to help cure the most common faults found in the full swing and short game. Daily sessions are scheduled for April 14-29.
— Faults & Cures For Women Only, a one-day program created to help eliminate the most common problems encountered by women golfers, to be held April 28-29.
“Our goal is to offer golfers of every ability the opportunity to take their game to the next level,” said Jim Flick, director of training and education for Nicklaus/Flick Golf School, a division of Golden Bear Golf, Inc. “Each of these programs is designed with that goal in mind, and offers instruction tailored to meet specific needs shared by a wide range of golfers.”
The Total Game Tour is an intensive, three-day instructional program focusing on Nicklaus/Flick’s unique anti-tension approach to improving the total game. Equal emphasis is given to the full swing, short game, course management and fitness and nutrition.
Widely-acclaimed golf instructor Jim Flick, who has taught more than 100 touring professionals including Jack Nicklaus and 1996 British Open champion Tom Lehman, will lead the instruction in seven of the ten cities hosting the Total Game Tour. Flick has hosted more golf schools than any other teacher in the profession. In 1988, he was named PGA of America Teacher of the Year and was the 1996 keynote speaker at the PGA of America Teaching and Coaching Summit.
Martin Hall and Mike Malaska, who together with Flick are members of Golf Magazine’s famed Top 100 Golf Instructors, will lead other sessions.
Enrollment is limited, with a student/teacher ratio of less than 5-to-1. Commuter rates for the Total Game Tour range from $1,875 to $2,275 per person.
Faults & Cures presented by Visa is a series of one-day instructional sessions aimed at curing the most common faults of golfers, such as incorrect grip pressure, bad posture, poor aim, body lunge, poor lower body support, and greenside play faults including the putting yips, the chili-dip and the skull.
Instructors from the Nicklaus/Flick Golf School will travel around the country to head the Faults & Cures program. Each instructor is hand-picked by Jack Nicklaus and Jim Flick based on understanding of the game and ability to teach students effectively in a personable, relaxed manner.
According to Charlie Ricks, vice president of the Nicklaus/Flick Golf School, this year’s Faults & Cures program features several enhancements.
“We’ve added a mobile video unit, which allows instant on-site video analysis of each student’s swing,” said Ricks. “We’ve also improved our student-teacher ratio from 8-to-1 to 6-to-1, to ensure each student has the optimum amount of personal, one-on-one instruction.”
Enrollment is limited. Cost is $350.
Faults & Cures For Women Only builds on the same principles as the Faults & Cures program, but focuses on the specific needs of women golfers.
“Last year, 22 percent of golfers enrolled in Nicklaus/Flick programs were women,” said Ricks. “A key objective for Nicklaus/Flick is to continue to be a leader in providing quality services and instructional products designed specifically for this growing market of golfers.”
Jackie Bertram Kaufman, who heads instruction for the Golf for Women Magazine Golf School by Nicklaus/Flick in Boca Raton, Fla., and Kathy Hart Wood, a member of the Nicklaus/Flick staff since 1994 and instructional editor for Golf For Women magazine, will be lead instructors for the For Women Only programs.
Other instructors include three-time U.S. Women’s Open champion Susie M. Berning and four-time LPGA Tour winner Janet Coles.
Enrollment is limited, with a student/teacher ratio of 6-to-1. Cost is $350.
The Faults & Cures program is presented by Visa, the world’s largest consumer payment system. Visa plays a pivotal role in advancing new payment products and technologies to benefit its 20,700 member financial institutions, their cardholders and the global economy. Visa’s 561 million cards are accepted at 13 million locations worldwide. The Visa Global ATM Network consists of more than 342,000 ATMs in 113 countries. For more information on Visa, visit Visa Expo at [www.visa.com].
The Nicklaus/Flick Golf School is a division of Golden Bear Golf, Inc. (NASDAQJACK). Golden Bear Golf is a diversified, international brand name golf products and services company engaged in the development, marketing and management of golf-related businesses including golf practice and instruction facilities, golf instructional schools, golf-related consumer products, and the construction of golf courses and resort-related facilities. For more information on Golden Bear Golf, please visit the website at [www.nicklaus.com].
To reserve a spot in any of these programs, call 1-800-642-5528.
Discounting new accounting standards for credit card securitizations, Sears Roebuck and Co.’s fourth-quarter 1997 net income was $512 million, compared to $567 million last year. The income drop was attributed primarily to increasing bad credit card debt. Responding to rising credit card delinquencies and chargeoffs Sears’ beefed up its provision for U.S. credit losses by $244 million during the fourth quarter. During the fourth quarter Sears’ total domestic provision for uncollectible accounts was $688 million, a 110% increase over its fourth quarter 1996 provision. The blowout in credit losses was softened somewhat by rising credit revenues. Sears reported fourth quarter 97 credit revenue of $1,309,000,000 representing a 20.8% increase over fourth quarter 96. The increased credit revenues were driven by higher card balances and increased late payment fees. At year end Sears private label credit card outstandings logged in at $28,596,000,000.Details
SPYRUS announced that Toyo will be its partner in Japan for its SecureWeb Payments SET toolkit developed by its subsidiary, Terisa Systems Inc.
Toyo is a leading systems integrator for the financial industry in Japan and will use SecureWeb Payments to enable SET product development and integration in Japan. TIS also announced today its commitment to develop the Japanese Payment Option (JPO) module for SecureWeb Payments. Together TIS and SPYRUS will develop the electronic commerce market for SET in Japan, a leading market for SET product deployment.
At the RSA Data Security(R) Conference last week, SPYRUS/Terisa announced SETCo(R) (a joint venture between Visa and MasterCard) is using SecureWeb Payments as the basis for all SET compliance test suites. To obtain a license to use the SET trademark requires that the product pass a series of compliance tests developed for that application (SET Cardholder, Merchant, Payment Gateway or Certificate Authority). Only those products that pass all the SET Compliance tests will be granted a license to use the SET trademark. This mark, issued only by SETCo, signifies an official SET compliant application. The relationship between SPYRUS and TIS ensures timely certification and deployment of SET-certified products to the Japanese market in 1998.
TIS has been developing and operating credit card application systems for 15 years. “They have demonstrated skill in handling credit and financial systems on mainframe and front-end processors, and have been aggressively developing application package products under the client-server environment in the fields of science and industry,” said Sue Pontius, SPYRUS CEO. “In addition, they have been successfully running Internet service provider and content delivery for the past several years. Therefore, we expect TIS will provide competent products and services related to SET for us in Japan and will play a significant role in SET solution development for the electronic commerce industry.”
“TIS has selected SPYRUS/Terisa’s SecureWeb Payments SET toolkit for its recognized position by Visa, MasterCard and SETCo as the SET standard in the market,” said Yoshiyuki Uenishi, Director of Cyber Business Unit, Cyber Commerce Department at TIS. “The availability of the SET Toolkit with the JPO from SPYRUS and TIS is a key step forward in the deployment and acceptance of SET as the global payment standard for Internet transactions in Japan. TIS is committed to providing the highest quality code from SPYRUS and will help make this a reality by enabling multiple vendors to develop and certify their applications to ensure compliance with the SET certification.”
TERISA SYSTEMS SECUREWEB PAYMENTS SET TOOLKIT
SecureWeb Payments provides a complete development environment for creating CardHolder, Merchant, and Payment Gateway SET applications. SecureWeb Payments provides developers with the industry standard, tested, ready-to-use implementation of SET, in addition to a secure key database, certificate management system and the RSA Data Security BSAFE(tm) cryptography engine. The toolkit includes a complete set of sample applications and is shipped in C source code.
SPYRUS is the leading provider of high-assurance hardware cryptographic products that are Algorithm Agile(tm) and form factor independent. SPYRUS’ products provide encryption, digital signature, access control, and metering solutions for corporate IS, WWW/Internet and Intranet applications, electronic commerce, and government applications. The Company’s core products are built around its SPEX/(tm) library, a host-based API that supports application integration with a suite of hardware cryptographic products.
SPYRUS cryptographic products are intended for use with security-sensitive applications; protocols such as SET, SSL, S-HTTP, S/MIME, and Microsoft(R) Authenticode(tm) technology. The Company’s products are used with a variety of certificate authority products to provide critical infrastructure support for issuance and management of a deployed hardware token community.
Founded in 1992, SPYRUS is headquartered in San Jose, California and has branch offices in Columbia, Maryland; Waltham, Massachusetts; Somerville, New Jersey and London, England. In 1997 SPYRUS acquired Terisa Systems Inc., which operates as a wholly owned subsidiary in Los Altos, California.
ABOUT TOYO INFOrMATION SYSTEMS
TIS (Toyo Information Systems), since its founding in 1971, has continued to build on its solid foundation as a total information services business. Through its strength in Software Development, System Design, System Operation, Network Communication (VAN) and Database Services, TIS improves business performance for a diverse customer base.
A leader in a quickly changing industry, TIS is listed on the first section of the Tokyo and Osaka Stock Exchanges. The Company is officially recognized as a “systems integrator” and its facilities in Osaka and Tokyo are certified for “Computer Security for the Data Processing Industry” by the Japanese Ministry of International Trade and Industry (MITI). TIS is also registered by the Japanese Ministry of Posts and Telecommunication as a “Special Type II Carrier.”
Recognition for its expertise and dependability is reflected in a growing customer base both in Japan and internationally and the success of those customers in today’s competitive world markets.
Note to Editors SPYRUS is a registered trademark of SPYRUS. SPEX/ and Algorithm Agile are trademarks of SPYRUS. Terisa Systems(R) is a trademark of Terisa Systems Inc., a SPYRUS Company. SecureWeb Payments(tm) is a trademark of Terisa Systems Inc.
All other trademarks are the property of their respective owners.
This release is available on the SPYRUS web site atDetails
Schlumberger Limited reported net income for 1997 of $1.3 billion and basic earnings per share of $2.62, 51% higher than in 1996. Operating revenue of $10.65 billion represented a 19% increase over the previous year and a record level for the company.
FOURTH QUARTER RESULTS
Fourth quarter net income of $373 million and basic earnings per share of $0.75, were 46% and 44% higher, respectively, than in the fourth quarter of 1996. Operating revenue of $2.91 billion was 16% above the same period last year.
Oilfield Services made substantial gains with a revenue increase of 19%, while rig count rose 15%. These results were driven by our ability to deliver leading-edge technologies along with cost-effective solutions which help our clients to continuously decrease the cost of finding and producing hydrocarbons.
Measurement & Systems revenue grew 7%, as strong growth at Automated Test Equipment and Electronic Transactions more than compensated for declines at metering.
Chairman and Chief Executive Officer Euan Baird commented “The strength of the results for 1997 speak for themselves as our oilfield revenue increased much faster than the average E&P spending of the oil companies. Our clients have budgeted a further increase in E&P spending of 10% in 1998. However, their plans may be modified when the impact of the economic problems in Asia on oil demand can be evaluated. Overall results of Measurement & Systems should improve in 1998, led by growth of the smart card systems and services markets and continuous growth of Automated Test Equipment.”
CONSOLIDATED STATEMENT OF INCOME
(Stated in thousands except per share amounts)
Twelve Months Fourth Quarter(Unaudited)
Ended December 31 1997 1996 1997 1996
Operating $10,647,590 $ 8,956,150 $ 2,907,701 $ 2,515,693
Interest and other income 106,823 69,515 34,074 17,972
10,754,413 9,025,665 2,941,775 2,533,665
Cost of goods sold
and services 7,836,952 6,835,444 2,123,854 1,902,105
Research & engineering 486,205 452,608 129,225 115,851
Marketing 307,036 301,304 83,135 81,989
General 369,030 355,392 97,671 92,674
Interest 86,843 72,020 26,769 18,015
Unusual items – 333,091 – –
Taxes on income 372,650 (175,677) 108,442 67,968
9,458,716 8,174,182 2,569,096 2,278,602
Net Income $ 1,295,697 $ 851,483 $ 372,679 $ 255,063
Per Share(1) $ 2.62 $ 1.74 $ 0.75 $ 0.52
Per Share(1)(2) $ 2.52 $ 1.70 $ 0.72 $ 0.50
outstanding(1) 495,215 490,041 497,732 492,647
assuming dilution(1)(2) 514,345 500,498 520,149 506,783
in expenses $ 972,539 $ 885,198 $ 257,525 $ 224,497
(1) Adjusted for two-for-one stock split on June 2, 1997.
(2) The calculation of diluted earnings per share assumes that all
stock options and warrants are exercised at the beginning of the
period and the proceeds used to purchase shares at the average
market price for the period.
NOTE In September 1996, the Company recorded three unusual items which
largely offset one another
– With increasing profitability and strong outlook in the US, the
Company recognized a portion of the US income tax benefit related to
its US subsidiary’s tax loss carryforwards and all temporary
differences. This resulted in a credit of $360 million.
– A charge of $300 million after tax related primarily to the
Electricity and Gas Management and Geco-Prakla Land and Transition
– A charge of $58 million after tax, including a loss on the
divestiture of the remaining defense-related activity, certain asset
impairments and other charges.
CONDENSED BALANCE SHEET
(Stated in thousands)
Assets Dec. 31, 1997 Dec. 31, 1996
Cash and short-term investments $ 1,761,077 $ 1,358,948
Other current assets 4,310,143 3,683,669
Long-term investments, held to maturity 742,751 323,717
Fixed assets 3,768,639 3,358,581
Excess of investment over net assets
of companies purchased 1,167,624 1,225,335
Deferred taxes on income, and other assets 346,497 374,801
$ 12,096,731 $ 10,325,051
Liabilities and Stockholders’ Equity
Accounts payable and accrued liabilities $ 2,297,370 $ 2,200,161
Estimated liability for taxes on income 384,167 367,562
Bank loans and current portion
of long-term debt 854,540 813,845
Dividend payable 93,821 92,842
Long-term debt 1,069,056 637,203
Postretirement benefits 396,559 383,129
Other liabilities 306,294 203,929
Stockholders’ Equity 6,694,924 5,626,380
$ 12,096,731 $ 10,325,051
(Stated in millions)
Oilfield Services Measurement & Systems
Fourth Quarter 1997 1996 % change 1997 1996 % change
Operating Revenue $ 2,060 $ 1,726 19 % $ 848 $ 793 7 %
Operating Income(1) $ 437 $ 305 43 % $ 54 $ 41 32 %
Operating Revenue $ 7,663 $ 6,129 25 % $ 2,986 $ 2,834 5 %
Operating Income(1) $ 1,557 $ 986 58 % $ 149 $ 124 20 %
(1) Operating income represents income before income taxes, excluding
interest expense, interest and other income, and the 1996 unusual
During the quarter, Oilfield Services operating revenue grew 19% over the same quarter last year with strong sustained activity from all businesses. Operating income rose 43%.
In North America, revenue increased 25%, representing 20% of consolidated revenue. The rig count climbed 24%. Operating income jumped 60%. Activity increased most significantly in the Gulf of Mexico, Alaska and Canada. The greatest contributions were from Wireline & Testing, up 28%, Dowell, up 21%, and Geco-Prakla, with a 21% increase. IPM grew more than fivefold due to the Hibernia project.
Outside North America
Outside North America, revenue grew 18%, representing 52% of consolidated revenue. The rig count grew 1%. Operating income rose 40%. All businesses experienced continued revenue growth, most prominently Sedco Forex, Wireline & Testing and Geco-Prakla, up 35%, 9% and 18% respectively. Activity was strong in all areas.
During the quarter, Schlumberger continued to deliver customized solutions to our clients, with the following benefits
— Reduced time to first oil and accelerated cashflow generation for the clients. Time is a critical element in oilfield projects, particularly offshore, given the current rig dayrates. PLATFORM EXPRESS(a) technology continues to gain momentum at premium prices with 260 active tools worldwide at year end. The PLATFORM EXPRESS tool reduces logging time through increased efficiency and multiple tool combinations. In the North Sea, during a horizontal logging operation, PLATFORM EXPRESS service has been combined with the MDT(a) Modular Formation Dynamics Tester to measure important reservoir parameters more efficiently than ever before. This combination has saved an average of 10 hours of rig time and over $150,000. The new FIV(a) Formation Isolation Valve proved successful in allowing safe perforating of a long horizontal well in a single trip without inhibiting the flow of the well. The client realized total savings of over $400,000 per well. In the Gulf of Mexico, Dowell PERFPAC(a) service continued to be in high demand as it combines perforating and gravel packing service in a single trip and saves clients as much as $300,000 in rig time per completion. Geco-Prakla installed a second Sun Microsystems Enterprise(TM) 10000 in the Houston processing center. With these cost-effective machines, computing power has increased dramatically, and productivity per person improved almost 50%. A combination of advanced technologies from Anadrill (PowerPak(a) steerable motors, SHARP(a) slim MWD technology and short-radius drilling) permitted a land operator to drill five wells ahead of schedule with significantly improved production. Performance incentives doubled Anadrill’s resulting revenue.
— Increased hydrocarbon reserves. New technology creates opportunities, such as the discovery of bypassed or untapped oil. In November in the North Sea, CMR(a) Combinable Magnetic Resonance technology was used to log an exploration well. The target sands held water, but higher uphole the CMR log analysis indicated some unanticipated oil in an interval that conventional log analysis would have missed. Subsequent testing confirmed the presence of oil. The oil company is now evaluating options, reviewing the seismic data and contemplating a sidetrack. As a consequence of its success using CMR service, the oil company decided to run the application in Alaska, Angola and Norway the following month. Overall, activity for CMR technology worldwide doubled in comparison with the same period last year.
— Increased production from existing fields. The new Vision475(a) slimhole, full-logging-suite MWD/LWD service continued to contribute to growth. In previous wells, geosteering using only resistivity permitted an operator to stay within a broad pay zone. The unique Vision475 azimuthal porosity data has allowed the operator to keep a new wellbore within the most productive part of this pay zone for 91% of the interval. The resulting production was 12,000 barrels of oil per day (BOPD), compared with 5,000 BOPD in previous wells. The Vision475 system also significantly lowered the total well cost, with a smaller wellbore and shorter lateral, while maximizing production.
— Higher levels of efficiency. Improved efficiencies are another result of effective applications of new technology. A PLATFORM EXPRESS-CMR combination tool string was run in a gas well to evaluate producibility over a 1000-foot sand/shale sequence. The combined technology provided reservoir parameters, such as water cut, permeability and bed thicknesses, which were then used to estimate a potential flow rate. The analysis predicted a gas rate of 5,300 thousand cubic feet per day (Mcf/day), close to the actual production of 4,500 Mcf/day. This successful application is now being used on subsequent wells to determine which zones to produce to optimize the well’s rate of return. In November, GeoQuest announced the commercial release of the next-generation GeoFrame(a) 3.0 integrated reservoir characterization system. The integrated capabilities of GeoFrame 3.0 let each member of a multidisciplinary team simultaneously view, edit and interpret data and results through all phases of a project and rapidly create an accurate reservoir model, thereby improving productivity.
As announced during the quarter, Sedco Forex has received long-term contracts to build two new-generation Sedco Express(a) semisubmersible drilling rigs, one for Elf Aquitaine in West Africa, and one for Texaco in the Gulf of Mexico. The Sedco Express is a fully integrated drilling unit which is expected to reduce well construction time by approximately 30%, compared to a conventional fourth-generation unit. In September, Sedco Forex acquired the remaining 50% interest in the semisubmersible drilling rig Sedneth 701 and the jackup Sedneth 202. At quarter end, there were 84 drilling units. The total offshore rig utilization was 93.8%, compared with 94.3% in the same quarter last year. The industry-wide average offshore rig utilization was 95.4%.
In addition to our client-focused enhancements, Schlumberger continues to improve its own internal efficiency and productivity. A new business data management tool, BASIS(a) (Business Application Solutions In Schlumberger), has been successfully implemented across all Oilfield Services finance, logistics and human resources activities in all our US and Canada sites and is currently being used by more than 3,000 trained employees and managers. This enterprise-wide software solution, based on the SAP R3 platform, seamlessly replaces dozens of existing discrete applications, thereby improving significantly our efficiency internally through increased sharing of data, tools and processes, and externally through increased understanding of our customers’ needs and improved service delivery, particularly for multiservice projects. For example, upon completion of a project, all business data generated at the wellsite is automatically captured and transmitted to create an invoice, update the tool maintenance schedule and generate a tool service quality report. The success of the North American implementation is the first step of the worldwide deployment of BASIS.
MEASUREMENT & SYSTEMS
Measurement & Systems revenue rose 7% compared with the fourth quarter of 1996, despite the adverse effect of exchange rate fluctuations. Continued growth at Automated Test Equipment (ATE) and Electronic Transactions and strong activity in Asia were the main contributors. Operating income increased 32%.
In the fourth quarter, revenue increased 63% for ATE and 17% for Electronic Transactions, including previously announced acquisitions. The substantial growth at ATE was driven by higher sales of 200-MHz and 400-MHz high-end logic testers. Shipments of such systems increased over 200% compared to last year, and contributed to a 117% gain at Test Systems. Diagnostics Systems revenue rose 67%, highlighted by the first shipments of the IDS3000(a) systems. Our Asia region and Japan were strong, accompanied by a doubling of revenue for North America. ATE orders rose 31% over the prior year, due mainly to an increase in demand for high-end logic products, solid gains at Diagnostic Systems and significant activity in the Asia region. Electronic Transactions growth was spurred by continued demand for subscriber identity module (SIM) cards in China, the Netherlands, and the US, and improved shipments of microprocessor cards for banking and pay television applications. Retail Petroleum Systems declined 6% as the effect of unfavorable exchange rates more than offset stronger Centurion(a) dispenser sales in the US and improved turnkey station construction activity in parts of Eastern Europe. Including previously announced acquisitions, orders improved 31%, led by strong card demand, customer acceptance of the MagIC(a) suite of terminals and the signing of a significant telecom contract in South America.
In the metering business, revenue decreased 11% compared with 1996, most of which was due to the adverse exchange rate effect. The most significant decline was in Europe. The UK business was impacted by a sharp drop in gas meter sales, while the Electricity business was affected in Germany by the reduced volume and price of polyphase meters and in Italy by a global suspension of electricity meter orders from ENEL, the national utility. Deliveries to ENEL should resume in January 1998. North America also declined slightly, mainly due to the cyclical falloff in electricity export sales, coupled with low demand for residential networking products. These shortfalls were partially compensated for by South America which improved mostly due to growth in the Gas business, with the penetration of the Gallus 2000(a) meters in both Argentinean and Chilean markets. Orders declined 16%, half of which was due to the adverse exchange rate impact, when compared to the fourth quarter of 1996.
CHANGE IN LIQUIDITY
Liquidity represents cash plus short-term and long-term
investments less debt. A summary of the major components of the
change in liquidity follows
(Stated in millions)
Twelve Months 1997 1996
Funds provided by
Net income $ 1,296 $ 851
Depreciation and amortization 973 885
Employee stock option plan 95 141
Employee stock purchase plan 50 39
Net proceeds on sale of drilling rigs(1) 174 –
Funds used for
Fixed asset additions (1,496) (1,158)
Businesses acquired (17) (139)
Dividends paid (371) (367)
Working capital and other (356) (208)
Change in liquidity 348 44
Liquidity, beginning of period 232 188
Liquidity, end of period $ 580 $ 232
(1) In September, the Sedco Forex semisubmersibles Drillstar and Sedco
Explorer were sold to a newly
formed venture in which Schlumberger has a 25% interest. The rigs will be
operated by Sedco Forex under
bareboat charters. The gain on sale has been deferred and will be amortized
over a six-year period. This
transaction had no effect on 1997 results and will have no significant
impact on future results of operations.
Transaction Systems Architects, Inc. , a leading supplier of application software for electronic payments and electronic commerce, reported record earnings of $.25 per share (diluted) on revenue of $61.1 million for the first quarter of fiscal 1998 ending December 31, 1997.
Operating income was $11.2 million for the quarter compared to an operating income of $7.6 million for the same quarter last year, an increase of 47 percent. Operating income for the first quarter of 1997 included acquisition related charges from the company’s 1993 leveraged buyout totaling $851 thousand. Without these charges, operating income on a pro forma basis was $8.5 million for the first quarter of 1997. Compared to 1997 pro forma operating income, the current quarter increase over last year was 32 percent.
The company reported net income of $7.2 million, $.25 per share (diluted), for the current quarter as compared to $4.3 million, $.15 per share (diluted) in the first quarter 1997. Compared to net income and earnings per share for first quarter 1997, the current quarter increase was 70 percent and 67 percent, respectively. Net income and earnings per share on a pro forma basis for the first quarter of 1997 was $5.0 million, $.18 per share (diluted). Compared to pro forma net income and earnings per share in 1997, the current quarter increase was 44 percent and 39 percent, respectively.
The company finished the quarter with $149.5 million in backlog consisting of $51.3 million in non-recurring revenue and $98.2 million in recurring revenues. Backlog increased $38.1 million, a 34 percent increase compared to December 31, 1996. Non-recurring revenues are composed of fees specified in software and services contracts the company expects to recognize in the next 12 months. Recurring revenues include all monthly license fees, maintenance fees and facilities management fees that the company expects to recognize over the next 12 months.
Cash flow from operating activities was $5.7 million for the first quarter of 1998. The cash balance on hand for the first quarter of fiscal 1998 ending December 31, 1997 was $47 million.
“We are pleased with our first quarter results, as it provides us with a very good start for fiscal year 1998,” said William E. Fisher, chairman, chief executive officer and president of Transaction Systems Architects. “Revenue growth in our European and Americas region was solid with 28 percent and 21 percent, respectively. Asia/Pacific which represents less than 12 percent of total revenue achieved a 15 percent growth rate despite the economic challenges within its region.”
Transaction Systems Architects 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, smart cards, home banking services, checks, wire transfers as well as automated clearing and settlement. Transaction Systems’ solutions are used on more than 2,800 product systems in 69 countries on six continents.
TRANSACTION SYSTEMS ARCHITECTS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited and in thousands, except per share amounts)
Three Months Ended December 31,
Software license fees $35,774 $27,139
Maintenance fees 11,349 10,106
Services 12,548 12,041
Hardware, net 1,388 553
Total revenues 61,059 49,839
Cost of software
Software costs 7,282 5,555
purchased software — 801
Cost of maintenance
and services 13,335 12,712
Research and development 5,505 4,079
Selling and marketing 13,752 10,569
General and administrative
General and administrative
costs 9,674 8,291
goodwill and purchased
intangibles 315 217
Total expenses 49,863 42,224
Operating income 11,196 7,615
Other income (expense)
Interest income 591 442
Interest expense (20) (57)
Other (80) (317)
Total other 491 68
Income before income taxes 11,687 7,683
Provision for income taxes (4,447) (3,415)
Net income $7,240 $4,268
Earnings Per Share Data
Net income $0.26 $0.15
Average Shares outstanding 28,071 27,756
Net income $0.25 $0.15
Average Shares outstanding 29,064 28,613
TRANSACTION SYSTEMS ARCHITECTS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited and in thousands)
December 31, September 30,
Cash and cash equivalents $46,966 $46,600
Billed receivables, net 40,501 39,864
Accrued receivables 25,399 25,063
Deferred income taxes 4,044 3,517
Other 3,184 3,043
Total current assets 120,094 118,087
Property and equipment, net 16,392 16,263
Software, net 6,504 6,105
Intangible assets, net 9,431 9,539
Installment receivables 1,298 2,394
Investment and notes receivable10,844 7,969
Other 4,792 4,877
Total assets $169,355 $165,234
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current portion of
long-term debt $802 $768
Current portion of
capital lease obligations 551 524
Accounts payable 6,325 7,896
Accrued employee compensation 4,278 5,559
Accrued liabilities 8,105 9,048
Income taxes 8,419 6,230
Deferred revenue 26,574 28,792
Total current liabilities 55,054 58,817
Long-term debt 1,609 1,465
Capital lease obligations 1,013 914
Total liabilities 57,676 61,196
Class A Common Stock 135 134
Class B Common Stock 6 6
Additional paid-in capital 104,626 103,708
adjustments (618) (260)
Retained earnings 7,542 462
Treasury stock, at cost (12) (12)
equity 111,679 104,038
Total liabilities and
stockholders’ equity $169,355 $165,234
Souvenir credit card purchases at this weekend’s ‘Super Bowl XXXII’ will be literally flying through the air. U.S. Wireless Data says its ‘TRANZ Enabler’ wireless technology will be used to process all credit card transactions at its 35 vendor locations throughout San Diego. CT-based N&D Sports says about 50% of its special merchandise sales are made on credit cards. N&D is the ‘Official Concessionaire for the San Diego Super Bowl Host Committee’.Details
Capital One Financial Corporation today announced a quarterly dividend of $.08 per share payable February 20, 1998 to stockholders of record as of February 9, 1998. This is the Company’s twelfth consecutive quarterly dividend since its February 28, 1995 spin-off from Signet Banking Corporation. Dividends declared by the Company are eligible for direct reinvestment in the Company’s common stock under its Dividend Reinvestment and Stock Purchase Plan. For additional plan information, stockholders should contact First Chicago Trust Company of New York at 800-446-2617.
Headquartered in Falls Church, Virginia, Capital One Financial Corporation is a financial services company whose principal subsidiaries, Capital One Bank, and Capital One, F.S.B., offer consumer lending products. Capital One’s subsidiaries collectively had 11.7 million customers and $14.2 billion in managed loans outstanding as of December 31, 1997, and are among the largest providers of MasterCard and Visa credit cards in the world.Details
If you answered yes to any of these questions, your finances could use an organizational overhaul. Turning chaos into order may seem like a tough job, but the National Foundation for Consumer Credit (NFCC) believes you can organize your finances and keep them that way. All it takes is an initial commitment of 30 minutes per day for a couple of weeks and then an hour per week after that. The big pay-off is a firmer handle on your money.
“The first step,” says Durant Abernethy, president of NFCC, “is to dedicate an area in your home to manage and store financial documents.” According to Abernethy, the area should have all of the supplies needed to run the family’s finances such as envelopes, stamps and a calendar. He adds that if you use a computer for financial management purposes, put it in this area as well.
The next step is to establish effective bill paying, budgeting and storage systems. For tax or bill paying purposes, it doesn’t really matter which system you use, just that you have a method that you and others in your family understand and can keep up. Here are some organizational tips.
Important documents–Make a complete listing of your important papers including your will, insurance policies and stock certificates. Write down the locations of safe deposit boxes. As a precaution, be sure to store originals of your most important papers in a fireproof box or another secure location. Store one copy of your will somewhere else other than in a safe deposit box.
Budget–To set up a budget, have all family members track their spending for a month. Then, tally the family spends in various categories, compare the total to your income and, if necessary, look for areas where you can reduce spending.
Spending–Categorize your spending regularly. This helps you stick to your budget. If you have a computer, you can use money management software programs to track spending categories. Or you can use a notebook to record expenditures. Another simple system is the envelope method–put money in envelopes labeled with particular categories such as lunch money or entertainment. Take out funds as needed. With this method, you can always see how much you have left in the category.
Bill paying–Designate one person as the bill payer. That person should allot time twice a month to pay bills. One system is to set up a master list of monthly bills and check off each bill as you pay it. Another idea is to use a wall calendar to write down when bills and irregular payments such as quarterly tax payments are due. Or, you can write out checks, seal them in envelopes and write on the outside when payments are due. Be sure to mail payments a few days before the due date. Also, make sure to review all of your credit card and loan statements for accuracy.
Taxes–Each January, establish an expandable file folder for the year’s tax records. Have different sections of the folder labeled with categories such as property tax, charitable donations, health and business expenses. As tax-related items like medical bills and canceled donation checks come in, file them in the appropriate category in the folder. Use your appointment calendar to record day-to-day unreimbursed business expenses. Monthly, transfer those records to the business expense section of that year’s tax folder. Keep old tax returns and supporting documents for seven years.
Investments–Keeping a record of investments. That way you’ll know the cost basis of your stocks, bonds and mutual funds, and when you sell them, you can quickly calculate the gain/loss for tax purposes. One system workable for an active trader is to keep buy orders in a trading folder. As the sell orders come in, match them up with the corresponding buy orders and file them both with your tax records for the year.Details