FL-based Racal Security and Payments introduced ‘SmartATM’ yesterday which offers cost-effective, hardware-based, cryptographic solution for improved security levels. ‘SmartATM’ provides Triple-DES or DES-based encryption and authentication functions that operate on a smart card for use in ATM applications. Designed for use on virtually any application platform without the need for special interfaces or additional power requirements, the ‘SmartATM’ smart card interfaces to the host system using a smart card reader with a serial interface that obtains power from the host’s keyboard interface. Specifically designed for ATM applications and meeting the emerging needs for the migration to Triple-DES and the requirement for unique key per terminal, SmartATM is used inside the ATM to provide Triple-DES or DES-based PIN encryption and ‘Message Authentication Code’ functions for transactions. All the cryptographic functions are performed on the ‘SmartATM’ card that also contains any keys needed by the system.Details
ATS MONEY SYSTEMS, INC. announced record earnings as a result of operations for the quarter ended June 30, 1999, which was set forth in its Quarterly Report on Form 10-QSB filed with the SEC on August 11, 1999.
2nd Quarter ended June 30 Six Months ended June 30
1999 1998 1999 1998
Total Revenues $4,244,476 $4,923,500 $7,535,119 $8,127,831
Net Income 560,970 194,964 806,087 308,385
Earnings per share $.10 $.03 $.14 $.05
Gerard F. Murphy, Chief Executive Officer of ATS Money Systems, Inc., commented, “Net Income of $560,970 during the 2nd Quarter 1999 was $366,006 (187.7%) higher than the $194,964 net income in the 2nd Quarter 1998 and was due to the increased sale of software at higher margins in the 2nd Quarter 1999. The record earnings achieved during the six month period are the result of the continued acceptance of our Cash Office System products, as well as initial sales of new products in the fast food, convenience store and grocery markets.”
Cost of equipment and systems sales decreased from 70.0% of sales in the 2nd Quarter 1998 to 47.8% of sales in the 2nd Quarter 1999. This was due to increased sales of software in the 2nd Quarter 1999 compared to higher sales of hardware in the 2nd Quarter 1998. Cost of maintenance and service decreased from 44.2% in the 2nd Quarter 1998 to 40.0% in the 2nd Quarter 1999 due to lower costs from a third party vendor.
Selling general and administrative expenses of $1,324,696 in the 2nd Quarter 1999 were $18,442 (1.4%) lower than in the 2nd Quarter 1998. Basically, higher salaries, additional staff and higher rents for increased office space was offset by reduced commissions resulting from a decrease in sales of equipment and systems.
Income tax expense for the 2nd Quarter 1999 was $403,000 compared to $122,000 in the 2nd Quarter 1998. This increase of $281,000 (230.3%) was due to the comparable rise in income from operations.
ATS Money Systems, Inc., with its consolidated wholly-owned subsidiary, Innovative Electronics, Inc., is engaged in the development, sales and service of currency counting systems and equipment for department and chain stores’ cash offices and bank commercial vaults and of specialized information communications systems primarily used by chain stores. The Company’s customers are businesses that handle a large number of cash, check and credit transactions on a daily basis, such as banks, department stores and chain stores.Details
eGlobe announced Tuesday its results for the second quarter of 1999, with consolidated revenue reaching more than $9.1 million and growth in the Company’s IP Voice and other new business meeting expectations. This revenue compares with revenue of $8.4 million in the first quarter and $6.8 million in the fourth quarter of 1998. In its form 10-Q filed with the SEC today, the Company also presented a strengthened balance sheet — reflecting financing arrangements entered into in the last two quarters and finalized in July. A condensed version of this pro-forma balance sheet is included in this press release.
Primarily due to the cost of expanding its IP Voice network, the Company posted an operating loss in the quarter of approximately $5.7 million, excluding acquisition, financing, amortization, depreciation and other non-cash charges. Including those charges the total loss was $11.2 million.
Commenting on the results, eGlobe’s Chairman Christopher Vizas said, “We are satisfied with our results for the second quarter and the improvement in operating margins excluding the up front costs for expanding our network. We experienced solid growth in our Network Services division and expect our billable minutes to continue to increase over the next several quarters.”
Network Services — IP Voice
As previously announced, the Company is building a global IP Network based upon the IDX business acquired in December 1998. Construction of that network, intended to support all of the services provided by the Company, is fueled by the sale of Internet Protocol (“IP”) Voice services — similar to those provided by Net2Phone, Delta Three and ITXC. eGlobe is concentrating on initiating this service with its international telephone company partners around the world — the same partners to whom it supplies support for post paid calling cards.
Revenues for Network Services reached $3.8 million in the second quarter as compared to $1.8 million in the first quarter, reflecting a 225% increase, from 7.3 million to 16.9 million, in billable minutes and not including $0.4 million of service provided to the Card Services Division of the Company. The Network Services division also expanded its direct network to a total of 16 countries in the second quarter.
In line with management expectations, Network Services experienced increased network expansion costs and significant losses in the second quarter. As a result of its costs of expansion and minutes growth, particularly the costs associated with implementing new direct routes and with building service on those routes, Network Services realized negative gross margins of approximately $1.0 million in the quarter and operating losses of $2.4 million. Adjusting for the up-front costs, route-by-route operating margins improved in the second quarter.
Sometime within the next year, the Company plans to reach sufficient volumes of traffic in Network Services to permit it to finance the acquisition of international fiber optic cable and other transmission links. These purchases are expected to lower the cost of service and improve gross margins. Even with such investment, however, management expects losses to continue during the expansion of the network.
Card Service revenue declined in the second quarter to $5.3 million from $6.8 million in the first quarter. While the legacy business of providing services to telephone companies around the world that issue post paid calling cards remained constant, Card Service revenue related to providing services to issuers of prepaid cards in the United States declined. The revenue decline resulted primarily from the tightening of contracts and procedures related to business with U.S. prepaid card issuers.
The Company showed substantial improvement in margins for Card Services. Gross margin was approximately $1.0 million, resulting in a quarterly operating loss for the division of approximately $700,000 — an improvement of $1.0 million over the operating loss in the first quarter. Management expects continued substantial margin improvement in the third quarter.
Global Office Services
eGlobe launched the first offering in its Global Office Services division in July, following its acquisition of Vogo Networks late in the second quarter. Global Office Services division had no revenue in the second quarter and is not expected to contribute material revenues this year, although it is expected to provide measurable revenue in 2000 and beyond. Global Office Services added about $200,000 to expenses in the second quarter and can be expected to contribute $1.0 million or more to operating costs over the next several quarters as it builds its unified messaging service and provides telephone access to Internet services.
Management is continuing its aggressive growth plan for 1999 and intends to pursue that plan into the foreseeable future. Implementing the plan will continue the large cash demands on the Company and the need for aggressive cash management. To accomplish all the Company’s objectives, management rose significant financing in the first and second quarter of 1999 and is focused on raising additional capital through the end of the fiscal year.
Through June 30, 1999, the Company raised new funds in excess of $32.0 million. To maintain growth, the Company plans a private placement of equity in the third quarter of up to $10 million and additional financing of debt or equity in the fourth quarter of 1999 or the first quarter of next year, depending upon market conditions.
“We continue to grow and expand our business and now offer customers multiple products and services. Our strategy is to be able to offer our customers a fully integrated suite of services and we have made substantial progress since the beginning of this year, when we had only a single line of service. Although we expect to continue to incur additional costs and expenses as we grow the business, we also expect to post sequential revenue growth over the next several quarters,” concluded Vizas.
eGlobe is a leading supplier of global enhanced telecommunications and information services, including Internet voice and fax, calling card services along with related validation, billing and payment systems and other international Intranet and inter-networking services in partnership with telecommunications operators around the world. Operating through its World Direct network, eGlobe originates traffic in 90 territories and countries and terminates anywhere in the world. eGlobe provides its services principally to telecommunications companies and financial institutions.Details
NextCard’s online ad budget has pushed the Internet card issuer into the list of the Top Ten Advertisers with the most impressions on the Web. First USA, the most active card issuer on the Web, slipped off the list. According to the Internet Advertising Index from Nielsen//NetRatings, NextCard came in at the No. 5 position for July compared to No. 23 in June and No. 7 in May. First USA has slipped to No. 27. FirstUSA scaled back its advertising efforts by not running any banners on Yahoo!, which accounted for about 40% of Yahoo!’s banners in June. Among the most viewed banner ads on the web is Capital One’s ‘Platinum VISA’ banner ad. According to Nielsen, the average Internet user in July visited 12 unique sites, viewed 353 pages and clicked on 0.58% of banner ads viewed. Meanwhile, CardWeb’s consumer channel advertising continues to deliver the highest response rate and approval rate for card issuers. CardWeb delivers, each month, 600,000 to 1,000,000 ad impressions which produce 70,000 to 100,000 clicks. Over the past twelve months CardWeb’s consumer channels have generated, based on advertiser feedback, an estimated 300,000 applications and 48,000 new accounts. The current twelve consumer ad slots on CardWeb.com are sold out.Details
WingspanBank.com, a subsidiary of Bank One Corporation, has announced the appointment of Michael J. Cleary as executive vice president of marketing. In this role, Cleary will be responsible for the marketing and product development areas of WingspanBank.com.
“We are very excited about Michael joining WingspanBank.com. He brings a level of marketing knowledge and experience which will prove to be extremely helpful in ensuring WingspanBank.com’s continued position as a leader in providing online financial services,” said Jim Stewart, president and chief executive officer, WingspanBank.com.
Prior to joining WingspanBank.com, Cleary served as president and chief operating officer overseeing worldwide sales, marketing and operations for Smart Carte, Inc. Previously, he served as executive vice president and chief operating officer for Pinnacle Brands where he was responsible for marketing, operations, creative, information technology, legal, licensing and human resources. He also served as the chief financial officer for a major sporting goods manufacturer. Cleary has a bachelor’s degree from Princeton University and a master’s degree in business administration from the Amos Tuck School of Business Administration at Dartmouth College.
WingspanBank.com ([http://www.wingspanbank.com]) is a division of FCC National Bank, a subsidiary of Bank One Corporation. WingspanBank.com is the new powerhouse in personal finance, offering consumers unparalleled freedom and choice in managing their money. WingspanBank.com provides consumers with a wide range of financial products and services brought together at one website, including traditional banking, investment and planning services, and objective search tools.
Schlumberger was awarded a contract, Tuesday, to provide ‘Pay & Display’ terminals, software and installation for 660 parking spaces in the City of Denver. With the Schlumberger parking system, the motorist simply inserts payment and the terminal issues a ticket that confirms the amount of time purchased. The motorist then returns to the vehicle and places the ticket in full sight on the vehicle’s dashboard. In order to simplify collection, the City of Denver wanted a parking solution that would allow motorists to pay by both credit cards and dollar bills. A credit card “hot list” is downloaded to the terminals each day to quickly reject unauthorized cards on site, while software enables card transaction data to be transmitted directly to the bank.Details
The Pathways Group, Inc. announced Tuesday that it has signed an agreement with Funtastic Traveling Shows, one of the largest carnival operators in the U.S. Under the terms outlined in the agreement, Pathways will implement a smart card system that will allow Funtastic to remove all cash from the midway. Conditions of the agreement call for Pathways to supply the hardware, including terminals and receipt printers, as well as the smart cards for the pilot period. Implementation of the pilot is expected to occur in California this October and will run for approximately two weeks.
During the experimental pilot program, Funtastic customers will purchase smart cards instead of paper tickets. These smart cards will be accepted at terminals located at rides, games and food concessions. The smart cards sold at Funtastic’s ticket windows will contain no preset value, thus allowing customers to add any amount of money onto the card that they desire. Because the cards are rechargeable, customers will be able to have value added to them as often as they choose. Pathways and Funtastic anticipate that this system will prove to be extremely convenient for customers and a benefit to Funtastic’s business.
The Pathways Group, Inc. is a leading U.S. developer of smart card-based technologies offering smart card and transaction processing solutions for commerce, retail, education, recreation, amusement, government, and transportation. The Pathways Group also designs and manufactures SPRINTICKET(TM) unattended ticketing dispensers. Every SPRINTICKET system operates on state-of-the-art hardware platforms using standard Microsoft(TM) operating systems and an SQL database. In addition to accepting all major credit cards, SPRINTICKET dispensers are designed to accept and recharge smart cards. Pathways performs the credit card processing for all SPRINTICKET transactions, including authorization at the time of purchase and end-of-day account reconciliation. SPRINTICKET dispensers are currently installed at ski areas, amusement parks, and transportation services across the United States.
Funtastic Traveling Shows operates carnivals along the West Coast, averaging 70 shows per year at shopping centers, festivals and fairs. They provide everything from the simplest merry-go-round to a complete state fair setup.
The Pathways Group, Inc. provides clients with innovative and unique solutions for securely creating, capturing and processing data and electronic transactions using custom application software and hardware systems. The company, established in 1987 by Carey Daly, has evolved into a leader in the development of custom software and hardware for electronic banking, data and transaction processing, and smart card applications. Pathways’ creation of proprietary “back office” systems allows for the capture and processing of data and transfer of funds via “ACH” protocol, the standard used in the banking industry for transfer of funds in retail, medical and institutional environments.Details
MasterCard International teamed up with a number of leading business-to-business providers to launch ‘MasterCard Small Business Connections’, a new Web initiative for small business cardholders. Initial partners include: ZDNet, Office Depot, MSN, Register.com and DigitalWork. The new online MasterCard service provides access to financial resources, news and information, buying opportunities and technology solutions for small businesses. ZDNet will provide the ‘Small Business Guide’, technology solutions, news and online forums. Office Depot will offer supplies and business resources. MSN will serve up news, tools and features. Register.com will offer domain name registration, services and information. DigitalWork will deliver Web-based help with common business tasks, from press releases to travel reservations. In addition, the ‘MasterCard Small Business Connections’ initiative will be linked by a regular email newsletter, ongoing surveys and polls and connections to important information and resources relevant to each individual member. MasterCard says it currently has six million business card accounts from firms scattered over 70 countries.Details
Bull announced yesterday that Steve Bagby has been named vice president, marketing and planning, for Bull Americas. In this newly-created position, Bagby is responsible for the strategic direction and marketing focus of Bull Americas, working closely with parent Groupe Bull and the company’s worldwide divisional marketing operations. Bagby reports to George McNeil, president and CEO of Bull Americas.
Bagby will focus on key activities to ensure that marketing, sales tools and processes adopted by the Groupe are fully implemented in the Americas, including strategic account planning and “must win” bids. He will have management responsibility for Bull America’s unique sales and marketing tools and processes, including coordination with Groupe on international accounts.
In addition, Bagby will take the lead role in any future merger and acquisition activities as they relate to Bull Americas, working with the appropriate entities in Bull Americas and at Groupe. He also will direct the evolution of Bull’s Smart Card & Terminals business in both North and South America.
Bagby has more than 20 years of experience in the information technology industry. Most recently, he was president & CEO of Salomon North America (a division of Adidas-Salomon), where he was successful in reversing a three-year decline in sales and achieving a 36 percent growth in sales. From 1989-1995, he worked for Bull as a vice president for strategy, marketing and business development, as vice president of the company’s UNIX product line, and in several other key management positions.
Bagby has a master’s degree in mathematics and a bachelor’s degree in mathematics, chemistry, and physics from the University of California.
Bull is an international IT group with operations in nearly 100 countries, and combined revenues of $4.3 billion in 1998. Bull offers a wide range of systems, infrastructure software and IT services, through focused innovation, alliances with the best partners and its own integration expertise.
In its industry, besides GCOS mainframes, Bull is recognized for innovative products: the Escala family of UNIX servers, the NT EXPRESS5800 range, smart cards and software such as OpenMaster and AccessMaster for secure management of systems and networks. Bull’s North/South American operations are headquartered in Billerica, Mass. The company’s web addresses are [http://www.bull.com] and for the United States, [www.us.bull.com].
OpenMaster and AccessMaster are registered trademarks of Bull S.A. in the U.S. and other countries. UNIX is a registered trademark in the United States and other countries, licensed exclusively through X/Open Company Limited.
San Francisco’s hotly debated ATM fee initiative, slated for the November ballot, has been taken online by Acme Software, Inc. Yesterday Acme launched a new web site: FAQvoter.com. Taking its name from the “Frequently Asked Question” lists which are popular on the Internet, FAQvoter.com is the first voter-driven news source on the Web. The company says the new web site gives San Francisco voters the opportunity to ask questions directly of the ATM fee initiative sponsors and opponents. At the same time, the site offers participating campaigns a more immediate understanding of what online voters want to know. Both the “pro” and “con” sides of the city’s ATM fee initiative are answering voter questions at FAQvoter.com. The initiative seeks to ban the $1.50 surcharge on non-account holders at San Francisco ATMs.Details
Extensity, Inc., a leading provider of Internet applications for the e-business employee, announced Monday the appointment of Brian Mort as vice president and general manager of European operations. Extensity also announced new partnerships with Web-based currency service provider OANDA, and leading value added tax reclamation companies, Meridian VAT Reclaim Inc., EuroVAT and Corporate VAT Management, to help corporations simplify international expense reporting.
Today’s news is part of Extensity’s expansion in the global marketplace to support multinational customers and optimize productivity for employees doing business around the world. This news also builds on Extensity’s recently announced support for multiple currencies and full Euro compliance, as well as its strategic global alliance with QSP, a leading U.K.-based financial software and services company.
New VP, General Manager of European Operations Brings Strong Track Record
Brian Mort, newly appointed vice president and general manager of European operations, will be based in the U.K. and focus on expanding Extensity’s presence in Europe. Prior to joining Extensity, he was global account director for SAP (U.K.) Ltd. in Enterprise Applications Software Sales. In addition to managing teams of salespeople, he was a member of the SAP Board of Directors Steering Committee. Additionally, his career spanned sales positions at Oracle Corp., Dell Computer Corporation and Rank Xerox.
“Extensity clearly understands the special requirements of overseas markets, and they’ve built a high level of support for these customers into the Extensity product suite,” said Mr. Mort. “I’m glad to be joining such an innovative and fast-moving company, and I look forward to continuing the company’s international growth.”
Extensity CEO Bob Spinner stated, “We’re excited to have Brian as a member of the Extensity team. His outstanding track record demonstrates his understanding of the market. We expect him to have a significant impact on our international expansion.”
Extensity Partners to Address Needs of International Travelers
Extensity’s newly announced partnership with OANDA gives customers real-time access to variable currency exchange rate data over the Internet. >From a Web link within the Extensity e-Business Application Suite, customers can quickly obtain exchange rates for 164 currencies. Customers can also have OANDA’s exchange rate data fed directly into the Extensity e-Business Application Suite, streamlining the time-consuming process of obtaining and entering daily rate information into international expense reports.
Meridian and EuroVAT will offer value added tax (VAT) recovery services on an outsourced basis to Extensity customers. Extensity’s partnership with Corporate VAT Management, the developers of AUTO VAT(TM), the world’s leading software package for automating the processes of generating VAT refund applications, allows Extensity’s customers to easily manage the VAT refund process internally.
Extensity’s software can automatically capture data and produce reports required for VAT refunds. VAT is a consumer-oriented tax imposed on goods and services in Europe, Canada (GST) and Korea and can often be recovered by corporations that do business internationally. VAT can account for millions of refundable dollars but it requires that companies follow time-consuming, paper-based administrative processes. Automation through Extensity’s software helps simplify the process.
“Extensity’s expertise in tax recovery takes the headache out of this complex process for our customers doing business across Europe. We’re excited to offer Extensity as a best-of-breed solution,” said David Pinches, Group Product and Marketing Director for QSP, which resells the Extensity e-Business Application Suite to customers in Europe, Asia Pacific and the United States.
Extensity e-Business Application Suite Has Built in Support for International Expense Reporting
As part of the company’s international expansion, Extensity recently announced several enhancements to the Extensity e-Business Application Suite to further simplify international expense reporting for travelers and provide comprehensive data capture to corporations. Extensity automatically supports the use of multiple currencies and lets users specify the currency that was used to pay for each incurred expense. Extensity also manages the fixed rated between the Euro and the 11 participating countries so that conversion between any of these nations’ local currencies can be calculated automatically, saving time and the hassles associated with completing this process manually. Extensity’s e-Business Application Suite also supports differing local date and currency formats allowing employees of multinational corporations to enter data in the customary format of the country where they are based.
Extensity is the leader in Internet applications for the e-business employee. Extensity’s integrated suite of applications radically transforms the way companies do business by automating everyday processes to optimize productivity and business results. Today Extensity addresses expense reporting, business travel, billable time capture and procurement. Established by Scopus Technology co-founder Sharam Sasson, Extensity is funded by premier venture backers including Hummer Winblad Venture Partners, Kleiner Perkins Caufield & Byers’ Java Fund, Weiss, Peck & Greer Venture Partners and Visa International. Extensity customers include Franklin Resources, Incyte Pharmaceuticals, Nationsbanc Montgomery Securities, RELTEC, the University of California, and the @Home Network. For more information on Extensity, go to [http://www.extensity.com].
California’s State Board of Equalization announced yesterday that State taxpayers can now choose from three credit cards to make their sales and use tax payments made to the BOE. The BOE piloted the acceptance of Discover cards and began accepting MasterCard and American Express this month. U.S. Audiotex is the credit card processing vendor for the program. U.S. Audiotex also holds the contract for the IRS credit card pilot. The firm charges a transaction fee for each tax payment, generally around 2% of dollar amount involved.Details