Retalix Revenues Up 34%; R&D Investment Grows

Ra’Anana-based retail POS specialist, Retalix, reported that global second quarter revenues jumped 34% compared to one-year ago, and up 11% sequentially. During the second quarter, US-based Costco installed its 200th site with the Retalix “StoreLine Fuel” solution and US-based Cumberland Farms installed its 200th site with the Retalix “StorePoint POS” solution. Internationally, Tesco agreed to install Retalix “BackOffice” across all sites in U.K., Europe and Asia and, Tussauds Group selected Retalix “StorePoint” for the group’s international theme parks. Revenues for the second quarter were $28.7 million, compared to $21.5 million in the second quarter of 2003 and $25.8 million reported in the first quarter. The Company reported net income for the quarter of $1.3 million, compared to a net income of $1.4 million in the second quarter of 2003.

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Kawasaki Motors Renews Household’s Contract

Household’s retail services business has signed Kawasaki Motors USA to another multi-year, private-label financing agreement. The agreement extends and strengthens Household’s long-term relationship with Kawasaki. Household has extended credit through Kawasaki’s private label credit program since 1989, providing Kawasaki dealers multiple credit products that offer quick and efficient processing, exciting credit promotions that drive customers to purchase and enables customers to make repeat purchases without having to re-apply. Household Retail Services is the third largest issuer of private label credit cards in the United States.

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NO EGG SALE

Prudential has decided to end discussions regarding a possible sale of
its majority interest in Egg. Egg says the latest results from its UK
operations show that the world’s largest pure online bank is on the
right track in building a profitable business. Egg confirmed last week
it is withdrawing from the French market, which has offset much of the
gains achieved in the UK. In October 2003, Egg announced that its French
management team had developed a revised business plan to reverse the
huge losses. However, the level of investment required to execute the
plan was greater than Egg was prepared to take on a stand alone-basis.
Egg then sought potential partners, but was then superseded by
Prudential announcing in January that it was considering proposals for
its approximately 79% shareholding in Egg. When it became clear that
there was no potential purchaser who valued the option in France, Egg
announced that it intended to take the necessary steps to withdraw from
the French market. For the second quarter, Egg produced an operating
profit for its British “Egg VISA” card of $35.3 million versus an
operating loss of $30.0 million for its French “la Carte Egg VISA.”
Overall, the Egg plc Group made a profit of $1.8 million in the second
quarter leading to an overall loss before tax for the first half of 2004
of $7.3 million, down from a loss of $41.9 million in the same period
last year. For complete details on Egg’s latest performance visit
CardData (www.carddata.com).

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Brightpoint to Market Axalto Smart Cards

IN-based Brightpoint North America has signed a deal to market Axalto’s mobile solution offering, including Axalto smart cards, smart card readers and middleware, to their wireless network operator customers in North America. The Axalto mobile solution is optimized for specific regional market requirements and gives wireless network operators the ability to exploit the full capabilities of today’s leading Java SIM card and a competitive platform for deploying enhanced mobile services to wireless customers. Brightpoint is one of the world’s largest distributors of mobile phones. Brightpoint supports the global wireless telecommunications and data industry, providing quickly deployed, flexible and cost effective solutions. Axalto is the world’s leading provider of microprocessor cards — the keys to digital networks — and a major supplier of point-of-sale terminals.

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RBS Buys Lynk Systems for $525MM in Cash

Privately-held, Atlanta-based Lynk Systems is being purchased by Royal Bank of Scotland through its US-based Citizens Financial Group for $525 million in cash. Lynk, a top merchant processor and acquirer, handles $18 billion in charge volume and 400 million transactions annually. The Company services approximately 100,000 merchants. Lynk also provides processing services for 25,000 ATM’s located throughout the USA representing $6 billion dispensed and 120 million transactions annually. The Company was founded in 1991 and has more than 950 employees. Financial Technology Partners and FTP Securities exclusively represented Lynk Systems in the pending sale to RBS. Lynk was a customer of Citizens Financial. Atlanta-based Arnall Golden & Gregory served as Lynk’s legal advisor.

Lynk Transaction Historical
2000: 124 million
2001: 155 million
2002: 208 million
2003: 282 million
2004: 400 million
Source: CardData (www.carddata.com)

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CompuCredit Profits Fall by One Third in Q2

CompuCredit reported second quarter 2004 net income attributable to common shareholders of $13.8 million, or $0.28 per diluted share, as compared to its second quarter 2003 net income attributable to common shareholders of $20.7 million, or $0.42 per diluted share.

Reflecting continued improvements in the credit quality of CompuCredit’s managed receivables, the net interest margin was 20.2 percent in the second quarter of 2004, as compared to 18.4 percent for the second quarter of 2003. The adjusted charge-off rate was 8.8 percent in the second quarter of 2004, as compared to 11.0 percent for the second quarter of 2003. Also, at June 30, 2004, the 60-plus day delinquency rate was 9.6 percent, as compared to 10.5 percent at June 30, 2003.

CompuCredit Corporation uses analytical techniques that allow it to provide credit and other complementary services and products to consumers it believes to be underserved by traditional grantors of credit. Credit cards marketed by CompuCredit generally are issued by Columbus Bank and Trust Company under an agreement with CompuCredit. For more information about CompuCredit, visit [www.CompuCredit.com][1].

For complete details on CompuCredit’s second quarter performance visit CardData ([www.carddata.com][2]).

[1]: http://www.CompuCredit.com
[2]: http://www.carddata.com

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PassMark Security Picks Up Klebe

PassMark Security has hired Steve Klebe, formerly with CyberSource, CyberCash, and VeriFone, as VP of sales and business development. In his new position, Klebe will be driving sales activity, forming key partner relationships and developing the sales organization. Klebe is a recognized strategic relationship builder who works with key industry players in the payment and risk industries to develop joint products, joint sales efforts and equity investments. PassMark Security of Redwood City, California introduced PassMark, a system for banks and ecommerce sites to deploy to prevent phishing attacks and provide a higher level of authentication.

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Fair Isaac Launches Falcon ID

Fair Isaac has launched an enhanced identity fraud detection solution fueled by predictive analytics and multiple sources of identity-validating data. The new “Falcon ID” evaluates transactions throughout the customer lifecycle, and detects identity fraud at any point where an identity is susceptible to compromise — including the points of application, account activation, account management and even during collections. It also can be used to evaluate and manage account decisions when consumers initiate account actions such as a change of address or a new telephone line. In addition, “Falcon ID” features a sophisticated case management system and authentication interview service that helps facilitate investigation when an identity compromise is detected.

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TSYS Buys Clarity; Forms TSYS Prepaid Inc.

TSYS acquired prepaid card specialist, Clarity Payment Solutions, for $53 million in cash. As a result of the acquisition TSYS has formed a new wholly owned subsidiary, TSYS Prepaid, Inc. to be based in New York City. Anil Aggarwal will remain the CEO of the new entity. Clarity has been involved in the launch of multiple prepaid cards including the “Elvis Presley Card” this year, the “Hilary Duff Card” last year, and the “GameCreds VISA” in 2002. The firm also has launched prepaid insurance settlement disbursement cards. Clarity provides a dynamic, data-driven processing platform that integrates real-time administration and reporting tools, sophisticated marketing and communications technologies, and leading compliance and risk management systems, as well as other unique capabilities that are vital to processing for the prepaid market.

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NCR Wins Cardtronics’ ATM Services Contract

Cardtronics has signed a services agreement with NCR for its 3,250 ATMs. Under the terms of the agreement, Cardtronics will deploy a new Gasper Vantage system in its new network operations center in Houston. Gasper is a unit of NCR’s Financial Solutions Division and a leading provider of software specifically tailored to solve self-service management issues. Cardtronics currently has a network of over 25,000 ATMs operating in all 50 states. CR Corporation is a leading global technology company helping businesses build stronger relationships with their customers.

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