December Crash

The November rebound in revolving debt was wiped out in December as consumers cut total revolving credit by more than $7 billion. The surprise news blew a hole in the consensus that consumers were returning to more normal credit patterns following September 11th. The decline was the sharpest one month drop in more than a decade. According to the monthly figures released by the Federal Reserve yesterday, revolving credit, mostly credit card debt, stands at $683.8 billion. During December 2000, Americans added nearly $2.8 billion to revolving credit. At the end of December 2001, American consumers were $1.645 trillion in debt, exclusive of home mortgages.

Dec 01 Nov 01 Oct01 Sep01 Aug01 Jul01 Jun01
GRWTH: -14.2% 9.7 -7.1 0.6 -2.2 -3.7 2.1
$OWED: $683.8 691.9 686.4 692.7 693.5 698.1 700.3

May 01 Apr01 Mar01 Feb01 Jan01 Dec00 Nov00
GRWTH: 4.5% 14.2 11.9 20.8 11.6 5.0 10.9
$OWED: $699.0 697.6 688.2 681.4 670.3 663.4 660.6

Source: Federal Reserve; revised figures as of 02/07/02; For complete historical data visit [][1].




Western Union Financial Services, Inc., a
subsidiary of First Data Corp. announced the launch of the
Western Union Money Transfer service in Uzbekistan.

Western Union, the first money transfer company to offer services in the
country, has established eight agent locations in the capital city of Tashkent
and surrounding areas. By the end of first quarter, Western Union will add
additional agent locations in the cities of Bukhara, Samarkand, Fergana and
Kokand. By the end of 2002, the company anticipates having up to 20 active
locations across Uzbekistan. Western Union’s new Uzbekistan agents —
Business Bank, Bank Khamkor and National Banks of Uzbekistan — have a
combined total of 42 locations throughout the country.

“Thanks to Western Union, thousands of Uzbek emigres in the U.S. will now
be able to send money legally, quickly and safely to their loved ones in
Uzbekistan,” said Mr. Ziyodilla Khodjimedov, Consul General of the Republic of
Uzbekistan in New York. “Western Union money transfers are going to make life
better for our relatives and friends in need,” Ziyodilla added, emphasizing
the importance of rapid money transfers in stimulating business growth and
developing the infrastructure of the country.

“Uzbek emigres have their own unique and proud heritage,” said Bill
Thomas, president, Western Union International. “Yet, they share one strong
characteristic with expatriates from around the world: the desire to become
active members of their adopted communities, while maintaining strong ties to
their homeland. One way they maintain those ties is by providing financial
support to loved ones back home. They trust Western Union to perform that
function, which is a responsibility we take very seriously.”

About Western Union Financial Services, Inc. and First Data

Western Union Financial Services, Inc., a subsidiary of First Data Corp.
(NYSE: FDC), is an international leader in consumer money transfer services.
Consumers can quickly, safely and reliably pay bills and transfer money around
the globe using the company’s proprietary money transfer network. Western
Union and its subsidiary, Orlandi Valuta, together make up one of the world’s
largest money transfer networks with a total of approximately 120,000 Agent
locations in more than 185 countries and territories. Famous for its
pioneering telegraph service, the original Western Union dates back to
1851 and introduced electronic money transfer service in 1871. For more
information, please visit the company’s Web site at

First Data Corp., with global headquarters in Denver, helps power the
global economy. Serving approximately 2.8 million merchant locations,
1,400 card issuers and millions of consumers, First Data makes it easy, fast
and secure for people and businesses to buy goods and services, using
virtually any form of payment: credit, debit, smart card, stored-value card or
check at the point-of-sale, over the Internet or by money transfer. For more
information, please visit the company’s Web site at


Options MasterCard

Canadian Tire Corporation, Limited reported that unaudited 2001 consolidated net earnings were up 19.3 percent to $176.7 million, or $2.25 per share, compared to $148.0 million or $1.89 per share recorded in 2000. Consolidated net earnings for the fourth quarter were up 28.8 percent, to $41.0 million or $0.53 per share compared to $31.9 million or $0.41 per share a year earlier. Retail sales in 2001 increased 6.9 percent and comparable store sales increased 2.2 percent. “During 2001 it became clear the retail sector would be impacted by economic uncertainty. Canadian Tire’s ability to increase sales by 6.9 percent in this environment demonstrated the strength of our position in the marketplace and the value we provide to our customers,” said Wayne C. Sales, president and CEO, Canadian Tire. While we are pleased with our financial performance, we are very excited with our opportunity to continue to accelerate our growth in earnings even further,” added Sales.

“While our 19.3 percent earnings per share growth benefited from certain one-time gains and year-over-year reductions in specific expenses, our earnings excluding these items exceeded the upper end of our previously released forecast. These results were delivered by a team totally focused on our operations, adjusting our plans and strategies to drive top-line growth, reduce costs and strengthen our balance sheet, ultimately increasing shareholder value,” added Sales.

Several factors enhanced the Corporation’s earnings before tax in 2001, including: $15.4 million from the sale of credit charge receivables; $8.0 million from the sale of Hamilton Discount Corporation, Limited (HDCL); and $11.8 million from the disposition of redundant real estate properties. Both the proceeds from the sale of redundant real estate properties and gains from the sale of credit charge receivables are expected to provide recurring earnings contributions during the outlook period of 2002-2005.

These positive contributions to earnings before tax were partially offset by several factors, including: $10.5 million in net expenses in, which is targeted to break even on an operating basis in 2002; $3.8 million invested to accelerate conversion of Canadian Tire retail cards to Options Mastercard(R) accounts; $6.2 million in expenses for CustomerLink, Canadian Tire’s supply chain initiative to develop and deploy multi-channel capability in its Distribution Centres in Brampton and Calgary; and an estimated $3.5 million in lost earnings contributions due to the sale of HDCL early in 2001.

The Corporation also benefited from reduced effective tax rates due to working capital initiatives and lower rates associated with the mix of income.

Consolidated gross operating revenue increased 3.2 percent to $5.4 billion from the $5.2 billion reported in 2000. Fourth quarter consolidated gross operating revenue was $1.4 billion, up 4.2 percent from the fourth quarter in 2000. Canadian Tire Retail gross operating revenue was up 4.0 percent in 2001, while Canadian Tire Financial Services gross operating revenue rose 6.9 percent. Canadian Tire Petroleum’s gross operating revenue declined 1.8 percent.

“We continued to make progress during the year in improving Canadian Tire’s financial flexibility and strengthening our balance sheet,” noted Sales. “Cash generated from operations reached $362 million. In addition, our Treasury group undertook a series of successful financing activities that were well received by the capital markets. We closed the year with a cash position of $579 million.”

Total capital expenditures in 2001 were $358 million, down $70 million from the original plan. Canadian Tire’s capital expenditure plan for 2002 is approximately $300 million, a further reduction of about $60 million from the previous year. During the past several years Canadian Tire has invested in growth and in required infrastructure such as supply chain capacity and capability. Starting in 2002, a larger percentage of our capital investments will be deployed to areas of profitable growth as infrastructure investments are completed.

During the year, Canadian Tire made significant progress in a number of key areas, including:

– the development and implementation of the Corporation’s strategic agenda for the period of 2002 through 2005;

– driving top-line growth and performance of our core business. Retail sales increased 6.9 percent to reach a record $5.3 billion;

– making significant progress in our Customer Values initiative to improve customer service, including the roll-out of Canadian Tire’s proprietary eLearning online training. This system is focused on customer service and product knowledge training for front-line store team members. Significant improvement was also made to store in-stock position with record service levels for shipments to stores from the supply chain;

– opening of 37 new-format stores, including 9 incremental stores, for a total of 270 new-format stores opened since this program began in 1994, bringing Canadian Tire’s total store count to 450;

– implementing the Next Generation merchandising concept in 15 existing new-format stores opened prior to 2001;

– commissioning the 500,000 square foot distribution centre in Calgary, Alberta, which is now shipping to 140 Western Canadian stores as part of a broader supply chain improvement initiative;

– achieving status as one of Canada’s most-visited retail eCommerce sites, reaching 2 million visitors in the month of October: CTR’s online operations are targeted to break-even on an operational basis in 2002;

– converting 450,000 retail cards over to Canadian Tire’s Options MasterCard(R), now representing more than two-thirds of Financial Services’ outstanding receivables, bringing outstanding receivables in Financial Services to an all-time high of $1.4 billion;

– completing the integration of the Auto Village/Drivers banners under the PartSource format, bringing the total to 30 PartSource stores opened across Canada. PartSource achieved double-digit growth in comparable store sales in 2001;

– continuing to outperform the gasoline industry in sales volume per site, with record sales volume and continued marketshare gains in 2001.


Retail Sales

Total retail sales for 2001 were $5.3 billion, a 6.9 percent increase over 2000. Comparable store sales increased by 2.2 percent. This sales performance reflects strong marketing programs and customer acceptance of our unique product assortment, offering basic goods for every day use. Retail sales for the fourth quarter were up 5.7 percent from the same quarter last year, with a resulting 1.7 percent increase in comparable store sales. “Our retail sales performance was encouraging, particularly in view of the strong, non-promotional sales growth we experienced in core, competitive categories such as hardware, housewares, automotive accessories, tires and lawn and garden. Throughout the year we continued to experience sales growth and market share gains in these key categories,” commented Sales. “Our retail sales momentum continued through January 2002,” he added.

Operating Performance

CTR closed 2001 with gross operating revenue of $4.2 billion compared to the $4.0 billion recorded in 2000. The increase was due to the year-over-year 4.0 percent increase in shipments to Associate Dealers, highlighted by an 8.9 percent increase in the fourth quarter as Canadian Tire Retail enjoyed strong sales during the key holiday period. CTR earnings before taxes for the year were $171.7 million, equal to 2000. While the Corporation enjoyed strong retail sales in 2001, earnings were impacted as Associate Dealers focused on reducing excess store inventory resulting in shipments that lagged sales. Lower growth in shipments also reduced purchase discounts from vendors, impacting CTR earnings before taxes. While in the short-term this reduction in excess store inventory impacted CTR’s results, the reduction will enable CTR to exploit merchandising and marketing opportunities going forward. During 2001, significant improvements were made in the CTR supply chain, and service levels to stores reached a record 91.7 percent.

Fourth quarter CTR gross operating revenue totaled $1,154.1 million, up 8.9 percent from $1,060.2 million in 2000, reflecting an 8.9 percent rise in shipments. Earnings before taxes for the quarter were $47.3 million, compared to $34.6 million a year earlier. The primary reason for this performance was the increase in gross operating revenue. This increase was partially offset by higher net advertising and marketing program expenses resulting from a reduction in vendor contributions totaling $13 million. On a year-over-year comparative basis, 2000 results were negatively impacted by $10.9 million in product clearance costs for Christmas lights and $4.0 million in restructuring costs.


Canadian Tire Petroleum reported 2001 gross operating revenue of $837.8 million, down 1.8 percent from $853.5 million recorded in 2000. Increased CTP gasoline litre volume was offset by lower prices at the pump, resulting in the revenue decline. In spite of reduced revenues, CTP continued to gain marketshare with a 1.3 percent increase in gasoline litre sales in an environment of limited industry volume growth.

Earnings before taxes for the year were $17.8 million, a 44.1 percent increase from the $12.4 million earned in 2000 due primarily to improved margins. Ancillary businesses in Petroleum such as car washes and propane experienced double-digit growth.

Petroleum’s fourth quarter gross operating revenue totaled $190.1 million, down 17.3 percent from the $229.8 million recorded in the fourth quarter of 2000. This reflected significantly lower pump prices and a decline in gasoline litre sales volume of 0.6 percent, due to 3 fewer CTP gasoline stations that were in the process of being redeveloped or replaced in the fourth quarter compared to 2000. Strong gross margins resulted in earnings before tax for the quarter of $4.7 million, 17.7 percent higher than the $4.0 million recorded in 2000.


Operating Performance

Canadian Tire Financial Services reported 2001 gross operating revenue of $352.3 million, up 6.9 percent from the $329.6 million recorded a year earlier. Earnings before taxes in 2001 were $87.5 million, up 54.4 percent from $56.6 million recorded in 2000. Revenue and earnings were positively impacted by gains from the sale of credit charge receivables and from the sale of HDCL, in addition to the rapid growth of credit receivables due to the accelerated growth of Options MasterCard(R) accounts. Excluding earnings contributions from the sale of receivables and from the sale of HDCL earnings before taxes would have been $67.6 million, up 19.4 percent from 2000. Accelerating Options MasterCard(R) account growth resulted in an 8.9 percent increase in gross credit charge receivables to $1.4 billion, which more than offset the reduction in charge card receivables associated with the first quarter sale of all third-party charge card receivables including Hamilton Discount. Excluding third-party charge card receivables, the year- over-year value of the portfolio would have grown by 19.1 percent. As of the end of 2001, Financial Services managed over 1.7 million MasterCard(R) accounts, an increase of more than 30 percent from a year earlier.

The quality of CTFS’s portfolio remains strong, with an improvement in aging of accounts and write-down rates remaining virtually unchanged at year- end.

Fourth quarter gross operating revenue was up 4.6 percent to $93.9 million, reflecting continued credit charge receivables growth, partially offset by the loss of contributions from HDCL and third-party processing contracts. Earnings before taxes in the fourth quarter declined 13.8 percent from $13.2 million to $11.4 million, due to $3.8 million in expenses for the launch of Project Accelerate, a program designed to encourage the conversion of Canadian Tire retail cards to Options MasterCards(R).


Commenting on 2002, Sales said: “Our results in 2001 have set the stage for us to continue making excellent progress across our network of businesses to drive top-line sales and reduce costs in order to accelerate earnings growth. In addition to our existing businesses, the acquisition of Mark’s Work Wearhouse in February 2002 will create $500 million in incremental revenue growth and provide immediate accretion to our earnings.”

Sales added: “Mark’s is a very strong, growing business that is highly compatible with our corporate growth strategy, which includes the development of new businesses. Mark’s also offers opportunities to leverage Canadian Tire’s core strengths and assets. It has demonstrated strong financial performance, has in place a targeted growth strategy and is led by a talented management team.”


In 2002 the Corporation expects to achieve total earnings per share in the range of $2.39 to $2.44. This estimate includes a strong contribution from increased gross operating revenue as well as continuing revenues from the sale of redundant real estate assets and credit charge receivables. The sale of redundant real estate assets and credit charge receivables are associated with the Corporation’s major new-format store real estate program and its acceleration of the conversion of Canadian Tire Retail cards to Options Mastercard(R). These strategic initiatives are part of the Corporation’s ongoing operations and will continue to contribute to earnings at least throughout the outlook period of 2002-2005. Mark’s Work Wearhouse is expected to contribute $0.08 to $0.10 on a per share basis towards this earnings forecast, prior to the realization of operational synergies. The Corporation is currently completing an analysis on how much of the estimated $5-7 million in ongoing annualized savings can be captured in 2002 and will communicate the benefit of this expense reduction on the Corporation’s earnings forecast once that process is complete.


On December 6, 2001 the Board of Directors declared a dividend of $0.10 per share on each Common and Class A Non-Voting share. The dividend is payable on March 1, 2002 to holders of record on January 31, 2002.

Canadian Tire Corporation, Limited (TSE: CTR.a, CTR) operates an inter- related network of businesses engaged in retail, financial services and petroleum. Canadian Tire Retail, with 450 stores across the country, is the country’s most-shopped retailer, offering a unique mix of products and services through three specialty categories in which the organization is the market leader — Automotive, Sports and Leisure, and Home Products. [][1] offers Canadians the opportunity to shop online.

PartSource is an automotive parts specialty chain with 30 stores designed to meet the needs of major purchasers of automotive parts — professional automotive installers and serious do-it-yourselfers. Canadian Tire Financial Services manages related financial products and services for retail and petroleum customers, and also markets other value-added products to our customers. Canadian Tire Petroleum is one of the country’s largest and most productive independent retailers of gasoline, with 203 outlets. Mark’s Work Wearhouse Ltd. is a specialty retail organization that operates 325 stores in Canada. More than 40,000 Canadians work across the Canadian Tire organization from coast-to-coast in our corporate, retail, financial services and petroleum businesses.

For complete details on Canadian Tire’s 4Q/01 performance please visit CardData ([][2]).



Datacap High Speed

Datacap Systems, Inc., a leading provider of integrated payment systems, announces the availability of Enterprise Server for NETePay, Datacap’s payment software that achieves 2-second authorizations via DSL or other ‘always on’ Internet and VPN connections. Enterprise Server accepts DES-encrypted authorization requests from remote locations running NETePay clients and forwards those requests to the bankcard processor for authorization and central settlement.

Most currently available payment systems require authorization and settlement of payment transactions at the individual store level. Store totals are then uploaded to headquarters for consolidation and reporting. Now chain stores can enjoy the operational benefits of managing all payment activity through a single headquarters server, while realizing fast 2-second authorizations. By managing and settling a single batch at headquarters, chains achieve significant savings by eliminating cashier and manager close procedures at the store level, while maintaining full accountability at headquarters. Substantial savings on processing fees can also be realized through a VPN connection to the merchant’s bankcard processor.

As brick-and-mortar retail and restaurant chains embrace the Internet for sending enterprise data, it’s only natural for them to take advantage of that same infrastructure for authorizing electronic payments. Because Datacap’s NETePay clients are triple DES-encrypted, merchants can safely send payment transactions over the open Internet to Enterprise Server, which is connected to the bankcard processor via the Internet or VPN, depending on the processor selected.

Systems developers that have already implemented Datacap’s latest Windows ActiveX controls for sending transactions to its dial-up server for DataTrana” can access NETePay Enterprise Server without any changes to their software.

For new developers, using Datacap’s client application and controls allows payment authorizations to be sent via dial-up or Internet/VPN, without any changes to their software. Purpose-built ECRs that use Datacap’s multi-lane LanTrana” system can also get these same fast payment authorizations via the Internet without changes to their ECRs.

The Company

Datacap Systems has successfully designed, manufactured and marketed integrated credit/debit/check verification systems for over 18 years. Datacap’s payment verification interfaces allow virtually any system, regardless of operating system or hardware platform, to get easy access to payment processing networks for credit, debit, check, EBT, house charge, gift card and loyalty program processing. Datacap products are typically used in retail, mail/telephone order, hospitality, quick service, retail petroleum, parking, auto rental, convenience, medical and government applications.

Additional Notifications

If you would like additional, more frequent notifications by email, send an email to Datacap sales admin at requesting email notification and indicating the Datacap products and partners’ products you currently use or re-sell.


ShopSite 6.0

UT-based ShopSite released version 6.0 of its e-commerce shopping cart application. ‘ShopSite Pro v6.0’ features two major upgrades, including United Parcel Service’s ‘Rates and Service Selection’ tool and National Processing Company’s processing credit card payment gateway. In addition, fraud prevention features, electronic couponing, digital downloads and improved performance capabilities have all been added to ‘Shop Site Pro v6.0’. Pricing for ShopSite Pro v.6.0 is $1,295 for a one-time/license fee. ‘ShopSite’ is available in three different applications: ‘ShopSite Pro’, ‘ShopSite Manager’ and ‘ShopSite Starter’. Pricing for ‘ShopSite Manager v6.0’ is $495 for a one-time licensing fee. ‘ShopSite Starter v6.0’ is only available through an ISP and is generally less than $5 per month and usually included in monthly hosting fees from an ISP.



Corporation, a leading global provider of wealth management and next
banking software, announced that its i-Wealthview Banking
software is
running in production at American Express Bank in Singapore as of January 18,
2002. The Singapore production follows a similar implementation of
Banking at American Express Bank in Hong Kong in September 2001.

The implementations at American Express Bank in Singapore and Hong Kong are
part of a global licensing and servicing agreement to implement Fincentric’s
i-Wealthview Banking software for American Express Bank, the international
banking subsidiary of American Express Company, in six countries.
“We are pleased to be meeting our commitments to American Express Bank on its
international banking initiative,” commented Mike Cardiff, President and Chief
Executive Officer of Fincentric. “Our software is designed to provide
customer-centricity and Customer Value Management(TM) capabilities that
strategies for increasing customer acquisition, retention and profitability.”

About Fincentric

Fincentric is a leading developer of wealth management software solutions for
the global banking industry. Fincentric’s i-Wealthview(TM) wealth management
software products include ‘next generation’ core banking, Customer Value
Management(TM), data aggregation, Internet & wireless financial portals and
full multi-channel support. Its revolutionary Customer Value Management(TM)
capabilities provide profitability and relationship analysis that allow
financial institutions to recognize the value of each customer, and maximize
their profitability. Fincentric products enable financial institutions to
quickly deploy solutions for their converging financial service offerings,
while also supporting capabilities for increasing customer profitability,
customer acquisition, and retention. Fincentric has more than 300 customers
worldwide, and has strategic relationships with Microsoft, Compaq, and other
international partners. For more information, visit Fincentric’s home page at, or call 604/278-6470.


AmEx Travel Revenues

While American Express has been hard hit by the collapse in travel spending, the shift to online travel bookings and its related business model have helped to offset the decline. Last year the company recorded a 500% increase in reservations made via corporate online booking tools, compared to the year earlier. Interactive travel bookings now represent over 6% of all American Express corporate travel reservations made in the U.S. In addition, American Express has shifted its business model to collect booking fees directly from users rather than relying on commissions paid by airlines. The lowest fees are charged to customers using AmEx online reservations. The move has also enabled AmEx to reduce the number of live agents as it beefs up is E-Fulfillment Center in Miami Lakes, FL. Since opening the new facility last year, AmEx has more than doubled its staff. In 1997, the company began fulfilling online bookings for small companies using its ‘RezPort’ online booking site through the ‘Small Business Interactive Travel Fulfillment’ center in Phoenix. From the two facilities, AmEx now fulfills interactive reservations for about 1,400 companies.



First Data said Wednesday it will release the ‘Statementlook’ service in April. The new service enables card issuers to provide consumers with an enhanced view of monthly statements with the option of making payments online. Issuers can present the information via a First Data-hosted or existing Web site and boost their branding/cross-selling efforts by using marketing banner ads. The new service also allows issuers to offer multiple payment options, including online transactions through their existing Web site, payments using the Western Union ‘MoneyZap’ service, or walk-in cash payments at any of over 40,000 Western Union agent locations in the U.S. FDC says the new service will further reduce issuers’ costs by offering various e-mail notification options for communicating with consumers as well as allowing consumers to make online account requests and updates.


Wells Fargo 4Q/01

Wells Fargo’s credit card unit posted a solid fourth quarter as receivables were up 4.4% over 3Q/01 and 8.7% over 4Q/00. Card volume also soared more than 19% during 2001, well above the growth rates of other major issuers. For complete details on Wells Fargo’s 4Q/01 performance visit CardData ([][1]).

4Q/01 3Q/01 2Q/01 1Q/01 4Q/00 CHNG
RECV: $5.3b $5.1b $5.0b $5.1b $4.9b +8.7%
VOL: $3.2b $2.9b $2.8b $2.6b $2.7b +19.3%
ACCTS: 5.2m 5.2m 5.2m 5.1m 4.7m +9.9%
ACTIVES: 3.0m 2.9m 3.0m 2.9m 2.8m +9.1%
CARDS: 6.8m 6.8m 6.8m 6.4m 6.1m +10.7%
Source: CardData (




The Royal Automobile Club of Western Australia has announced their profits
the new American Express RAC Credit Card
will go towards research into major childhood illnesses.For the first year
following the credit card’s launch, 100 percent of RAC’s profits will go to
Western Australia’s world-renowned Institute for Child Health Research.RAC
Group Chief Executive Terry Agnew said the decision to back the Institute for
Child Health Research came after strong support from the RAC’s members for the
work undertaken by the organisation.“By joining forces with such worthy causes
as the Institute, the RAC sees this as a great opportunity to provide
additional support to the community,” said Agnew.Professor Fiona Stanley,
founding director of the Institute for Child Health Research, said she is
delighted at the generous support of the RAC.“The Institute’s research
translates into better health and healthcare ­ any donations towards this
research is greatly appreciated,” Stanley said.Agnew said the new credit card
was one more way the RAC offers added value to its 400,000 members.“Research
has shown that our members are looking for financial products which offer
superior benefits, added value and one that rewards them for their loyalty,”
Agnew said.The American Express RAC Credit Card offers a reward program
tailored for members, with a wide range of features from retail vouchers to
accommodation and travel.Other benefits include: ·A low introductory interest
rate of 6.99 percent for Gold Card members and 7.99 percent for Blue Card
members for up to six months. ·Low ongoing interest rates.
·The same
introductory rate applies for the life of any balance that is transferred from
switching to an American Express RAC Credit Card. ·Up to 55 days interest free
and no annual fee for the first year. ·Gold Card members will receive a 100
percent discount on their next annual RAC standard roadside assistance, with
other cardmembers receiving a 50 percent discount. “We are happy to say that,
in conjunction with American Express, we have put together a credit card offer
which delivers maximum benefits to our members,” said Agnew.American Express
Senior Vice President John Steward said, “The partnership between RAC and
American Express has been built on creating and delivering exceptional
that offer distinct benefits to customers. “We believe American Express offers
the best credit card program in Australia. The American Express RAC Credit
provides value not traditionally found in other credit cards,” Steward
said.American Express Company is a diversified worldwide travel, financial and
network services company founded in 1850. It is a world leader in charge and
credit cards, Travelers Cheques, travel, financial planning, business
insurance and international banking.



SureFire Commerce Inc. announced its financial results for the third
quarter of
fiscal year 2002. The
Company continues to deliver on its commitment to profitability by recording
its third consecutive quarter of net profit and its ninth consecutive quarter
of operating profit. The Company also reported revenue of $64.7 million for
the first nine months of fiscal 2002, 21% higher than revenue of $53.4 million
for the same period last year.

“For the first nine months of fiscal 2002, SureFire Commerce has remained
focused on achieving net profitability and we have done so in an economic
environment that has been very challenging. We are willing to accept a slower
rate of short-term revenue growth in order to remain profitable and build for
the long-term. We are extremely pleased with these results,” said Rory Olson,
President and CEO of SureFire Commerce.

For the three-month period ended December 31, 2001, revenues totalled
$19.6 million. SureFire Commerce also recorded operating profit of $870,000
and net profit of $534,000, or $0.01 per share. For the first nine months of
fiscal 2002, revenues totalled $64.7 million, compared to $53.4 million for
the nine-month period ended December 31, 2000. For the first nine months of
fiscal 2002, net profit totals $2.6 million, compared to a net loss of $20.2
million for the nine-month period ended December 31, 2000. Revenue for the
third quarter remained relatively unchanged compared to the previous quarter,
primarily due to overall weakness in the general economy and the continuing
impact of the tragic events of September 11th.

Cash and cash equivalents at the end of the quarter totalled $94.4
million, including $78.8 million in customer deposits as well as $15.6 million
in free cash. The Company has a receivable from one of its suppliers of
services in the amount of $10.2 million. This receivable relates to charges
from the supplier that the Company believes are unsubstantiated and the
Company is actively pursuing their recovery. In the opinion of management,
adequate provision has been made in the accounts of the Company.

SureFire Commerce also reported that it has achieved several milestones
during the quarter. The Company currently has in excess of 130,000 FirePay
Personal Accounts, and processed US $87.9 million in transactions for these
accounts in the third quarter of fiscal 2002. The Company has in fact
processed almost 24 million transactions since the launch of its proprietary
transaction processing engine a year ago.

As part of its strategy, SureFire Commerce remains committed to net
profitability and will endeavour to stimulate strong mid- to long-term revenue
growth by pursuing relationships with regulated land-based gaming companies
pursuing online strategies. The international land-based gaming industry,
including Nevada and other regions across the United States, is a multi-
billion-dollar industry, and several of the best-known names in the industry
are announcing proactive online business strategies. The Company continues to
derive just over 60% of its processing volume from the licensed online gaming
industry, and is seeing a dramatic increase in the internationalization of
that revenue. Licensed casino operators have launched significant global
marketing campaigns that have resulted and continue to result in a marked
increase in consumers from Europe, South America, and Asia.

The Company continues to pursue marketing partnerships in order to
increase its merchant and consumer client bases, which rely on SureFire
Commerce’s many innovative payment solutions. Recent partnerships with, Infopia, InQuent, Intuit Canada, Network Commerce,, and RedBrigade have contributed greatly to the Company’s low-risk
payment processing business, resulting in the opening of 565 new accounts in
the third quarter alone. The Company now has over 2500 accounts with small
business clients. By processing transactions for and its airline
and hotel clients, SureFire Commerce has also accelerated the development of
its online loyalty business and intends to pursue further business
opportunities where the management of online loyalty points and rewards are

Third-Quarter Highlights

During the third quarter, SureFire Commerce continued to develop
innovative products, which led to the Company closing several marketing
partnerships. Product development and partnership agreements are focused on
payment solutions in three core areas: Internet payment processing for online
businesses, bill presentment and payment processing for physical businesses,
and corporate billing solutions. Significant highlights for the third quarter

– the extension of its private-label agreement with Intuit Canada
through the creation of the Quicken Home and Business Credit Card
Service, enabling small businesses to accept credit card payments
online and send invoices by email;

– the delivery of multi-currency capability, allowing SureFire
Commerce to process 30 currencies, more than any payment processor
in the world and facilitating its expansion into Europe;

– a partnership agreement with RedBrigade, a European-based systems
integrator, that will integrate SureFire Commerce’s bill presentment
and payment solution into its financial processing system and market
it to corporate clients with high-volume billing needs;

– a strategic alliance agreement with Wysdom Inc. in order to offer
mobile operators a hybrid version of SureFire Commerce’s online
payment solution and enable small businesses to perform payment
transactions with mobile devices;

– a partnership agreement with that will see SureFire
Commerce process transactions for the pointspurchase(TM) platform
used to operate loyalty programs such as buyAAmiles from American

– the launch of CIBC eShops, which combines the security and peace of
mind of online shopping through a trusted financial institution with
the convenience of one-stop shopping in a virtual mall;

– the announcement of a normal course issuer bid to purchase for
cancellation approximately 5% of the Company’s public float;

– on November 6, 2001, the Corporation adopted a voluntary stock
option replacement program for the benefit of its employees pursuant
to which a total of 1,717,800 stock options having exercise prices
ranging from $1.00 to $11.10 were cancelled and 1,209,235 new
options having an exercise price of $0.90 and vesting over three
years were issued;

– the launch of the QuickBooks UK Credit Card Service, enabling small
businesses in the U.K. and Ireland to process credit card payments
as well as send and settle invoices by email in pounds sterling and

– a strategic partnership agreement with Actinic Software Ltd., a
leading developer of B2B and B2C software solutions in Europe, to
integrate SureFire Commerce’s online payment solutions into their
two main products, Actinic Catalog and Actinic Business, which are
marketed through over 1600 value-added resellers in Europe.

“Building proprietary transaction processing technology a year ago was a
significant milestone in the evolution of our company, allowing us to develop
innovative solutions and risk management expertise tailored to our customers’
needs,” said Rory Olson. “SureFire Commerce has now processed 24 million
transactions since the launch of our transaction processing engine and we are
entirely committed to our core business, payment processing.”

About SureFire Commerce Inc.

SureFire Commerce Inc. is a global provider of secure online payment
solutions and e-commerce support, processing over $1.2 billion of online
transactions annually. The Company specializes in payment solutions in three
core areas: Internet payment processing for online businesses and_licensed
online gaming entities, bill presentment and payment processing for physical
businesses, and corporate billing solutions. SureFire Commerce’s online
payment solutions are marketed to consumers and merchants through strategic
partnership agreements with companies that have significant brand recognition
and distribution channels. SureFire Commerce is headquartered in Montreal
(Quebec) with offices in Hull (Quebec) and London (England).


Hitachi Palm Cards

Addressing the increasing security needs in consumer, corporate and mobile commerce (mCommerce) sectors, Hitachi Semiconductor (America) Inc. presents two advanced demonstrations that expand Secure MultiMediaCard applications at PalmSource 2002:

— Enhanced SecureMMC: With a new user authentication feature, this method will broaden a range of applications and present new market opportunities for data protection on mobile handheld computing devices, such as health care, corporate data and government applications.

— The second conceptual demonstration illustrates the benefits of merging Smart Card security platform technology and MultiMediaCards’ large storage capacity to enable mCommerce applications and other high security mobile data services. This card lends all the functionality of Smart Cards into a small, industry standard size.

SecureMMC — Content protection plus user authentication

The advanced secure memory card demonstrated at the conference adds a user authentication feature to the first generation Hitachi SecureMMC for the Keitaide-Music distribution network on mobile phones in service in Japan since 2000. These secure memory cards, compliant with the Content Protection SecureMMC specification recently adopted by the MultiMediaCard Association (MMCA), utilize Public Key Infrastructure (PKI) technology and hardware Tamper Resistance Module (TRM) to safeguard the transfer and storage of secure data. The new card previews a planned addition to Hitachi’s SecureMMC product line. It stores content (data, records, copyrighted material, etc.) that can only be accessed after an authorized user inputs the private PIN (Personal Identification Number) protected on the card. The security functions built into card’s hardware can withstand aggressive, malicious electronic attacks. For example, the SecureMMC with PIN authentication can enable sales executives or government employees to safely acquire, store, transport and view confidential information such as strategy plans, volume pricing data, or government statistics. At the same time, they have the assurance that sensitive data stored on the SecureMMC in the handheld device cannot be accessed by anyone in the event the memory card and/or the handheld is lost or stolen.

Making applications more mobile

According to Sami Nassar, managing director of strategic marketing at Hitachi Semiconductor (America) Inc., “The new SecureMMC provides both theft-protected digital storage and private access in a rugged, easily transportable medium. Software developers can leverage the card’s capabilities to create applications that allow greater security and mobility. When the card is inserted into the expansion slot of a Palm(TM) handheld, for example, new medical data acquisition software could let nurses collect patient care information conveniently, on the spot, while denying access to that data to unauthorized hospital personnel. Many more intriguing application possibilities for SecureMMC devices exist.” To encourage developers to create such programs, Hitachi demonstrated sample applications of personal and enterprise data security solutions in the PalmSource exhibit hall. Also, Hitachi plans to offer software developer tool kits (SDKs) for Palm handhelds to facilitate code design and debug. Application development is inherently easier in any case because the code itself can be simplified, since the security functions are implemented in the memory card’s hardware rather than in the software. This product is the first to simultaneously provide both key data encryption and access authorization.

Secure distribution, storage and retrieval

“There’s a rising demand for greater security across multiple markets, and Hitachi is stepping up to create a secure expansion card solution,” said Kevin Hell, senior vice president of product management, Solutions Group, Palm, Inc. “We are seeing significant opportunities for SecureMMC among our enterprise and government customers.”

MultiMediaCard technology roadmap accommodates evolving market needs

According to Andy Prophet, executive director of the MMCA, the standards organization that oversees MultiMediaCard technology, “The MultiMediaCard Association is very pleased to see card vendors, including Hitachi, offering SecureMMC for Content Protection. We believe the Palm platform is ideally suited for this purpose, and the market will be seeing a wide and exciting range of content available soon for SecureMMC.”

Concept: Smart Card technology enhances SecureMMC devices

The second MultiMediaCard innovation that Hitachi showed at the PalmSource 2002 conference is a conceptual demonstration of Smart Card technology in a MultiMediaCard memory card format. The marriage of Smart Card technology and secure data storage will enable highly secure mobile financial transactions and a new generation of portable data security applications. The memory card’s dual functionality would make possible diverse new mCommerce opportunities on Palm handhelds and other handheld devices that can’t be built today. “Hitachi is a major supplier of the complex, highly secure embedded controllers used in the Smart Cards now widely accepted in Europe and Asia as advanced bank/credit cards, sophisticated security keys, identification cards, GSM subscriber identification modules (SIM) and more,” said Haruji Ishihara, chief engineer of System Memory Business Unit, Semiconductor and Integrated Circuits at Hitachi, Ltd. “The conceptual presentation we made today at PalmSource 2002 hints at how a Palm handheld with a `Smart’ memory card could be used for financial transactions and other types of interactive applications, such as e-wallet, e-ticket and e-government. We have also highlighted a development environment that will help third-party experts create and perfect the requisite software more quickly and easily.”

About Hitachi Semiconductor (America) Inc.

Hitachi Semiconductor (America) Inc., a subsidiary of Hitachi America, Ltd., supports the requirements of the North American marketplace with a broad range of standard and low-power semiconductor solutions. Offering some of the industry’s most popular microcontrollers, microprocessors and memory components, among other semiconductor solutions, Hitachi provides chips to the world’s leading device manufacturers within industrial, consumer and emerging market applications. Hitachi’s substantial design engineering, research and development facilities in the United States help bring the world’s best technology to U.S. customers. For more information, visit: . Hitachi America, Ltd., a subsidiary of Hitachi, Ltd. (NYSE:HIT), markets and manufactures a broad range of electronics, computer systems and products, consumer electronics and semiconductors, and provides industrial equipment and services throughout North America. For more information, visit: [][1].

Hitachi, Ltd., headquartered in Tokyo, Japan, is one of the world’s leading global electronics companies, with fiscal 2000 (ended March 31, 2001) consolidated sales of 8,417 billion yen ($67.9 billion*). The company manufactures and markets a wide range of products, including computers, semiconductors, consumer products and power and industrial equipment. For more information on Hitachi, Ltd., please visit Hitachi’s Web site: [][2]. *At an exchange rate of 124 yen to the dollar.

About MMCA (MultiMediaCard Association)

MMCA was founded in 1998, with 14 companies, to promote the worldwide adoption of a postage-stamp size, removable storage standard for digital information in small and low-power devices. The organization has grown rapidly and now has over 100 members worldwide, representing all branches of mobile electronic applications, including semiconductor suppliers, software vendors and manufacturers of products such as_music players, mobile phones, PDAs, digital cameras, voice recorders, GPS navigation devices, bar code scanners and more. The MMCA developed and regulates open industry standards that define all types of MultiMediaCards, ensuring full interoperability between the cards produced by all MMCA members. MultiMediaCards offer an unmatched array of features and benefits, and are becoming the industry standard for compact removable storage media across multiple host platforms and markets. MMCA headquarters are located at PO Box 2012, Cupertino, CA 95015-2012. More information is at the web site: [][3].

NOTE: Palm OS and PalmSource are registered trademarks and Palm is a trademark of Palm, Inc. Other brands may be trademarks of their respective owners. (1) MultiMediaCard is a trademark of Infineon Technologies AG of Germany, and is licensed to the MMCA (MultiMediaCard Association).