Trintech Reports Third Quarter Fiscal Year 2008 Financial Results

Dublin, Ireland/Dallas, Texas - November 21, 2007- Trintech Group Plc (NASDAQ: TTPA), a leading provider of integrated financial governance, transaction risk management, and compliance solutions for commercial, financial, and healthcare markets worldwide, today announced third quarter revenues of $7.7 million, an Adjusted EBITDA loss of $164,000 and a net loss for the quarter of $1.2 million. Highlights: * Revenue amounted to $7.7 million compared to $6.7 million in Q3 last year, representing 15 percent growth. * Gross margin amounted to $5.0 million in Q3, representing 64% of revenue, compared to $5.0 million and 75% in Q3 last year. The fall in gross margin percentage was primarily due to the inclusion of the healthcare business acquired in Q4 of fiscal 2007, which historically has had lower margins than our FMS business, and an increased amortization charge which was also related to the purchase of the healthcare business. * Trintech reduced expenditure in research and development from $1.3 million in Q3 last year to $1.2 million in the same quarter this year. The decrease was primarily due to reduced staffing costs. * Trintech increased expenditure quarter on quarter in sales and marketing from $2.0 million in Q3 last year to $2.5 million in the same quarter this year. The increase was primarily due to the inclusion of costs related to the healthcare business. * Trintech also increased expenditure in general and administrative from $2.0 million in Q3 last year to $2.3 million in the same quarter this year. The increase was primarily due to the inclusion of costs related to the healthcare business, higher professional costs related to tax and Sarbanes-Oxley compliance and the impact of the weakening US dollar on our euro-based costs in Q3 this year. * On a consolidated basis, Trintech incurred an Adjusted EBITDA loss of $164,000 for Q3 compared to Adjusted EBITDA loss of $782,000 for the corresponding period last year. * Combined basic and diluted net loss per equivalent ADS for the quarter ended October 31, 2007 was $0.07, compared with a basic and diluted net income per equivalent ADS of $0.11 for the quarter ended October 31, 2006. * Following the sale of its payments systems business to VeriFone Holdings Inc. in the third quarter of fiscal 2007, Trintech is required to present its financial results on a continuing and discontinued basis. Cyril McGuire, Chairman & Chief Executive Officer said, "Trintech's performance remains on track to return the business to EBITDA profitability by the end of our current fiscal year, despite a challenging and competitive marketplace. We continue to launch new innovative products and expand our market reach to position Trintech for broader growth opportunities in 2008." Paul Byrne, President, added, "We continue to believe that our investment program in our product and sales and marketing programs will drive sufficient revenue growth to return Trintech to EBITDA profitability by the end of the current fiscal year. Whilst there are challenges in lengthening buying cycles as customers implement additional procurement processes, we continue to see growing pipelines and opportunities resulting from the investments we have made this fiscal year and are confident in our ability to grow revenues. We are also continuing to expand our distribution channels and geographic reach to underpin 2008 growth." Recent Highlights include: Trintech announced that Lafarge selected ReconNET to automate bank account reconciliation and to reduce exposure to risk. Lafarge Services (UK) Limited is the Shared Services operation that provides services to Lafarge operating entities in the UK, including Lafarge Aggregates, Lafarge Cement UK, and Lafarge Plasterboard. Lafarge is a leading supplier to the professional construction industry and the home improvement market. Trintech announced that Delhaize Group selected AssureNET GL to shorten close cycles, reduce risk, and eliminate paper-based evidence binders. AssureNET GL will also help Delhaize Group better satisfy Sarbanes-Oxley compliance requirements. The Belgian food retailer, Delhaize Group, operates approximately 2,500 stores under several banners in the US and seven countries in Europe and Asia. At home, Delhaize Belgium runs 723 stores under banners such as Delhaize, AD Delhaize, Proxy Delhaize, and Tom & Co. Trintech announced that Alimentation Couche-Tard Eastern Division selected ReconNET to automate funds reconciliation processes, monitor transactional risk, and optimize the resolution and reporting of exceptions. Alimentation Couche-Tard, French for "food for those who go to bed late," is the largest convenience store retailer in Quebec. The selection of ReconNET by Couche-Tard Eastern Division is part of an expansion in the convenience store sector; Circle K Divisions in Arizona and Mac's Convenience Stores in Ohio also currently utilize the ReconNET reconciliation system. Trintech announced that it expanded its partnership with Prodiance Corporation, a leading provider of solutions for financial spreadsheet remediation and control, to deliver the XLNET spreadsheet risk and compliance management solution to the European market. The application complements Trintech's AssureNET GL and ReconNET reconciliation software solutions to provide enterprises with a compliance framework for managing critical spreadsheets associated with account reconciliation, financial reporting, budgeting, forecasting, revenue recognition, and other key financial processes. Trintech announced the availability of ReconNET 7.4 which is Trintech's latest release in its integrated suite of Financial Governance software. The newest version of Trintech's reconciliation and account balancing application will help clients further streamline reconciliation workflow; reduce resource allocation to the reconciliation and exception management process; improve auditing, documentation, and internal control; and speed exception management resolution. Trintech announced significant enhancements in the new release of its accounting compliance software solution, AssureNET GL. AssureNET GL version 3.3 is designed to help give complex global organizations a fully SOX-compliant transaction matching, reconciliation, and accounting compliance platform. AssureNET GL 3.3 includes user interface enhancements that increase efficiency and flexibility, as well as new security, search, and reporting features. AssureNET GL is used to automate and control key accounting activities by some of the world's most recognized companies, including Accenture, Regis Corporation, Rohm and Haas, Brady Corporation, JohnsonDiversey, AMC Theatres and East West Bank. Trintech announced the release of its innovative Lifecycle Management (LCM) Payments solution for financial institutions. LCM Payments is a browser-based account reconciliation and positive pay solution that enables financial institutions to provide their clients with a more diverse range of real-time capabilities, based on customer-specific business requirements, while consolidating multiple existing systems into a single integrated platform. LCM Payments supplements other financial services solutions with advanced fraud prevention technology to provide clients with complete visibility into the status of their account reconciliation programs. Trintech announced that Healthcare Financial Management Association (HFMA) had examined ClearContracts(TM) for Hospitals and Physician Groups, a solution that helps increase hospital revenue through the identification and correction of payer non-compliance issues in the contract revenue cycle, using the new HFMA Peer Review process. After undergoing rigorous review, ClearContracts now features the notable "Peer Reviewed by HFMA" mark. Concuity's ClearContracts(TM) is a web-based revenue cycle management solution that allows healthcare organizations to manage the entire contract revenue cycle. Trintech announced the availability of Concuity Healthcare Solution Suite for financial institutions. ClearContracts(TM) for hospitals and ClearContracts Pro (for Professional Groups) are web-based applications designed to fit into a healthcare organization's revenue cycle management plan. ClearContracts enables all types of healthcare providers to analyze overall contract performance, verify expected reimbursement, and enhance the financial profitability of new and proposed payer contracts. Trintech announced the availability of ClearContracts 7.2 which further improves Revenue Cycle Management with increased Contract Analysis and Negotiation Capabilities. Results Overview: Continuing Operations: Revenue in the third quarter was $7.7 million compared with $6.7 million for the corresponding quarter last year, an increase of 15 percent. Software license revenue for the quarter ended October 31, 2007 was $3.7 million compared with $4.0 million in the corresponding quarter last year, a decrease of 6 percent. The decrease in software license revenue was primarily due to customers extending the buy cycle as they implement additional procurement processes for our products in the US market. However, software license revenue has increased by 11 percent for the nine months ended October 31, 2007 compared with the corresponding period last year. Service revenue for the quarter ended October 31, 2007 increased 46 percent to $4.0 million from $2.7 million in the corresponding quarter last year due primarily to revenues related to the healthcare business and to a lesser degree, increased revenues from FMS customers in our Europe, Middle East and Africa region. Total gross margin for the third quarter was $5.0 million, which represented no change from the corresponding quarter last year. Total operating expenses from continuing operations for the third quarter were $6.3 million, an increase of 15 percent from $5.5 million in the corresponding quarter last year. Adjusted EBITDA operating expenses from continuing operations for the quarter ended October 31, 2007 were $5.5 million, an increase of 11 percent on the Adjusted EBITDA operating expenses from continuing operations for the corresponding period last year. The increase in operating expenses and Adjusted EBITDA operating expenses was primarily due to the inclusion of $0.9 million operating expenses related to the healthcare business, higher professional costs related to tax and Sarbanes-Oxley compliance and the impact of the weakening US dollar on our euro-based costs compared to the corresponding period in the prior year. Adjusted EBITDA net loss from continuing operations was $164,000 for the third quarter compared to an adjusted EBITDA net income of $350,000 from the corresponding quarter last year. Trintech's balance sheet remains strong with net cash and cash equivalent balances of $23.9 million as of October 31, 2007. Net cash generated for the three months ended October 31, 2007 was $1.1 million. During the quarter ended October 31, 2007, Trintech did not purchase any shares via the share buy-back program. As a result, $2.9 million remains available for future repurchases under this program as at October 31, 2007. Trintech will host a conference call to discuss its financial results and business outlook beginning at 15:30hrs (UK Time) today, Wednesday, November 21, 2007. Please see advisory for information on the call. A web simulcast of Trintech's conference call reviewing our performance for Q3 fiscal year 2008 and our business outlook for Q4 will be broadcast live today, Wednesday, November 21, 2007 at 15:30 hrs (UK Time), 10:30 hrs (NY Time) and 07:30 hrs (CA Time) and thereafter for 1 year at www.trintech.com. An instant telephone replay will also be available for 10 days by dialing +44 1452 550 000 and entering the following access number (2 4 5 1 8 0 2 2 #). About Trintech Group Trintech Group Plc (NASDAQ: TTPA) is a leading provider of integrated financial governance, transaction risk management, and compliance solutions for commercial, financial, and healthcare markets worldwide. Trintech's recognized expertise in reconciliation underpins its suite of financial governance solutions, enabling businesses to address critical business objectives leading to more informed decision making and better overall business performance. Over 500 leading global organizations, including - North Fork Bank, 7-Eleven, Kroger, Regal Entertainment, Accor, UPMC, Farmer's Insurance Group, YUM! Brands Restaurants, Rohm and Haas, Verizon Wireless, and Ameren - realize the benefits of Trintech's configurable and highly scalable solutions everyday to: improve performance through stronger management of the revenue cycle and disbursements; ensure the accuracy and integrity of financial data; identify and reduce transaction risk; improve the quality and timeliness of financial reporting; and strengthen internal controls to support compliance requirements. Trintech's principal business office is in Dallas, Texas, with international offices in Ireland, the United Kingdom and the Netherlands. Trintech can be reached at 15851 Dallas Parkway, Suite 900, Addison, TX 75001 (Tel 1.972.701.9802). Trintech's corporate office can be contacted at Trintech Technologies, Block C, Central Park, Leopardstown, Dublin 18, Ireland (Tel 353.1.293.9840). For more information, please visit www.trintech.com. Forward Looking Statement This news release contains "forward looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Any "forward looking statements" in this press release are subject to certain risks and uncertainties that could cause actual results to differ materially from those stated. "Forward looking statements" in this press release include statements, among others, relating to Trintech management's goals to return to EBITDA profitability by the end of the current fiscal year, sales pipelines, opportunities resulting from investments made in the current fiscal year, Trintech's ability to grow revenues in the future, the expected benefits from Lafarge Service's installation of ReconNET GL, Delhaize Group's installation of AssureNET GL, Alimentation Couche-Tard Eastern Division's installation of ReconNET and the expanded partnership with Prodiance Corporation to the European market. Factors that could cause or contribute to such differences include Trintech's ability to accurately predict future sales, its ability to accurately predict and meet customer needs and to successfully position itself in the market, Trintech's ability to ensure the performance of its products and services, and its ability to improve the performance of its organization and ensure the long term health of its business. Actual performance may also be affected by other factors more fully discussed in Trintech's Form 20-F for the fiscal year ended January 31, 2007 filed with the US Securities and Exchange Commission (www.sec.gov) and subsequent filings with the US Securities and Exchange Commission. Lastly, Trintech assumes no obligation to update these forward-looking statements. TRINTECH GROUP PLC CONDENSED CONSOLIDATED BALANCE SHEETS (U.S. dollars in thousands, except share and per share data) October 31, January 31, 2007 2007 ASSETS Current assets Cash and cash equivalents $ 23,948 $ 25,766 Accounts receivable, net of allowance for doubtful accounts of $43 and $244 at October 31, 2007 and January 31, 2007, respectively 5,926 6,920 Prepaid expenses and other current assets 1,252 1,054 Net current deferred tax asset 55 396 Assets held for sale and in discontinued operations - 204 Total current assets 31,181 34,340 Non-current assets Restricted cash 338 - Property and equipment, net 1,645 1,567 Intangible assets, net 5,083 6,730 Goodwill 15,985 15,531 Total non-current assets 23,051 23,828 Total assets $ 54,232 $ 58,168 LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities Bank overdraft $ 137 $ - Accounts payable 1,172 1,263 Accrued payroll and related expenses 1,849 2,080 Deferred consideration 75 795 Other accrued liabilities 1,946 1,712 Deferred revenues 8,143 7,964 Liabilities held for sale and in discontinued operations 151 962 Total current liabilities 13,473 14,776 Non-current liabilities Capital leases due after more than one year 190 - Deferred consideration 1,954 2,003 Deferred rent less current portion 448 511 Total non-current liabilities 2,592 2,514 Series B preference shares, $0.0027 par value 10,000,000 authorized at October 31, 2007 and January 31, 2007, respectively None issued and outstanding - - Shareholders' equity Ordinary Shares, $0.0027 par value: 100,000,000 shares authorized; 32,066,707 and 31,875,219 shares issued and 31,474,189 and 31,159,093 shares outstanding at October 31, 2007 and January 31, 2007, respectively. 87 86 Additional paid-in capital 249,897 248,898 Treasury shares (at cost, 592,518 and 716,126 at October 31, 2007 and January 31, 2007, respectively) (1,011) (1,222) Accumulated deficit (207,429) (203,862) Accumulated other comprehensive loss (3,377) (3,022) Total shareholders' equity 38,167 40,878 Total liabilities and shareholders' equity $ 54,232 $ 58,168 TRINTECH GROUP PLC CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (U.S. dollars in thousands, except share and per share data) Three months Nine months ended October 31, ended October 31, 2007 2006 2007 2006 Revenue License $ 3,731 $ 3,985 $ 11,750 $ 10,550 Service 3,991 2,739 12,238 7,748 Total revenue 7,722 6,724 23,988 18,298 Cost of revenue License 409 304 1,186 773 Amortization of purchased technology 164 41 491 117 Service 2,172 1,355 6,462 3,661 Total cost of revenue 2,745 1,700 8,139 4,551 Gross margin 4,977 5,024 15,849 13,747 Operating expenses Research and development 1,152 1,313 3,679 3,483 Sales and marketing 2,527 2,025 7,994 5,423 General and administrative 2,263 1,950 7,286 5,838 Amortization of purchased intangible assets 385 224 1,156 674 Total operating expenses 6,327 5,512 20,115 15,418 Loss from operations (1,350) (488) (4,266) (1,671) Interest income, net 264 402 845 1,079 Exchange gain, net 184 213 381 397 (Loss) income before provision for income taxes (902) 127 (3,040) (195) Provision for income taxes (253) (145) (543) (243) Net loss from continuing operations $ (1,155) $ (18) $ (3,583) $ (438) Loss from discontinued operations - (3,503) (13) (6,771) Profit on sale of discontinued operations - 5,280 29 4,818 Net income (loss) from discontinued operations, net of tax - 1,777 16 (1,953) Net (loss) income $ (1,155) $ 1,759 $ (3,567) $ (2,391) Basic and diluted (loss) income per ordinary share $ (0.04) $ 0.06 $ (0.11) $ (0.08) Shares used in computing basic net (loss) income per ordinary share 31,430,368 30,601,393 31,318,787 30,581,747 Shares used in computing diluted net (loss) income per ordinary share 31,430,368 31,336,945 31,318,787 30,581,747 Basis and diluted (loss) income per ADS $ (0.07) $ 0.11 $ (0.23) $ (0.16) TRINTECH GROUP PLC RECONCILIATION OF NET LOSS TO ADJUSTED EBITDA NET LOSS (U.S. dollars in thousands) Three months Nine months ended Oct 31, ended Oct 31, 2007 2006 2007 2006 Net loss from continuing operations $ (1,155) $ (18) $ (3,583) $ (438) Adjustments: Depreciation 171 124 472 277 Amortization of purchased intangible assets 549 265 1,647 788 Share-based compensation 282 236 816 741 Interest income, net (264) (402) (845) (1,079) Income taxes 253 145 543 243 Adjusted Earnings Before Interest, Taxation, Depreciation, Amortization, Share-based compensation (EBITDA) net (loss) income for continuing operations $ (164) $ 350 $ (950) $ 532 Adjusted Earnings Before Interest, Taxation, Depreciation, Amortization, Share-based compensation (EBITDA) net (loss) income for discontinued operations - (1,132) 13 (3,491) Adjusted Earnings Before Interest, Taxation, Depreciation, Amortization, Share-based compensation (EBITDA) net loss $ (164) $ (782) $ (937) $ (2,959) Note: Management believes Adjusted EBITDA net loss is an important measure of Company performance without consideration of the non-operating expense adjusted above as it presents a clearer view of operational performance changes between the comparative periods. TRINTECH GROUP PLC RECONCILIATION OF OPERATING EXPENSES TO ADJUSTED EBITDA OPERATING EXPENSES (U.S. dollars in thousands) Three months Nine months ended Oct 31, ended Oct 31, 2007 2006 2007 2006 Total operating expenses from continuing operations $ 6,327 $ 5,512 $ 20,115 $ 15,418 Adjustments: Depreciation (155) (113) (430) (245) Amortization of purchased intangible assets (385) (224) (1,156) (674) Share-based compensation (268) (215) (751) (689) Adjusted EBITDA operating expenses from continuing operations $ 5,519 $ 4,960 $ 17,778 $ 13,810 Adjusted EBITDA operating expenses discontinued operations - 1,572 (29) 9,933 Adjusted EBITDA operating expenses $ 5,519 $ 6,532 $ 17,749 $ 23,743 Note: Management believes Adjusted EBITDA operating expenses is an important measure of Company performance without consideration of the non-operating expense adjusted above as it presents a clearer view of operational performance changes between the comparative periods. TRINTECH GROUP PLC CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (U.S. dollars in thousands) Nine months ended October 31, 2007 2006 CASH FLOWS FROM OPERATING ACTIVITIES: Net loss $ (3,567) $ (2,391) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation 472 496 Gain on sale of fixed assets (5) - Amortization of purchased intangible assets 1,647 791 Share-based compensation 816 932 Profit on sale of business, net - (4,818) Effect of changes in foreign currency exchange rates (15) (307) Changes in operating assets and liabilities: Inventories - 430 Accounts receivable 1,054 219 Prepaid expenses and other current assets (33) (43) Amounts prepaid to related parties - 440 Value added tax receivable 33 358 Accounts payable (235) (3,490) Accrued payroll and related expenses (310) 659 Deferred revenues 149 627 Value added tax payable (53) (441) Warranty reserve (16) (1,691) Other accrued liabilities (553) 2,783 Net cash used in operating activities (616) (5,446) CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of property and equipment (538) (555) (Payment) proceeds relating to sale of business (331) 5,406 Proceeds from legal settlement - 1,744 Payments relating to acquisitions (865) (3,415) Net cash (used in) provided by (1,734) 3,180 investing activities CASH FLOWS FROM FINANCING ACTIVITIES: Principal payments on capital leases (45) - Proceeds on sale of fixed assets 338 - Issuance of ordinary shares 390 169 Proceeds under bank overdraft facility 137 976 (Increase) decrease in restricted cash deposits (338) 14 Net cash provided by financing 482 1,159 activities Net decrease in cash and cash equivalents (1,868) (1,107) Effect of exchange rate changes on cash and cash equivalents 50 204 Cash and cash equivalents at beginning of period 25,766 34,745 Cash and cash equivalents at end of period $ 23,948 $ 33,842 Supplemental disclosure of cash flow information Interest paid $ 53 $ 13 Taxes paid (received) $ 118 $ (75) Supplemental disclosure of non-cash flow information Acquisition of property and equipment under capital leases $ 338 $ - - END - Contact Paul Byrne, President Joseph Seery, VP Finance, Group Trintech Group plc +353 1 293 9840 paul.byrne@trintech.com joseph.seery@trintech.com The full press release including tables can be downloaded from the following link: