-- GAAP EPS 10 Cents
-- Adjusted EPS 15 Cents
-- Full-year Revenues Increase 27% to $74.5 Million
JERSEY CITY, N.J.--Feb. 13, 2006--Fundtech Ltd. (NASDAQ: FNDT), a leading provider of global electronic payment, settlement and cash management solutions, today announced financial results for the fourth quarter and year ended December 31, 2005. Fundtech posted quarterly revenues of $19.8 million, a 12% increase year-over-year, compared to fourth quarter revenue of $17.7 million in 2004, and a 3% sequential increase compared to third quarter revenue of $19.1 million in 2005.
On a GAAP (Generally Accepted Accounting Principles) basis, the Company reported net income of $1.6 million or $0.10 per diluted share, for the fourth quarter of 2005 compared with net income of $1.1 million, or $0.07 per diluted share, in the fourth quarter of 2004, and net income of $1.4 Million, or $0.09 per diluted share, in the third quarter of 2005.
Excluding amortization of intangibles and amortization of capitalized software costs, Fundtech's adjusted net income for the fourth quarter of 2005 was $2.3 million, or $0.15 per diluted share, compared with $1.8 million, or $0.12 per diluted share, in the fourth quarter of 2004 and $2.0 million, or $0.13 per diluted share, in the third quarter of 2005. (See Schedule A attached to this news release
-- Reconciliation to GAAP).
"It was a great year for Fundtech", said CEO Reuven Ben Menachem. "Record fourth quarter revenues and operating profits culminated in annual revenue growth of 27% and operating profit growth of 99%. As we move ahead in 2006, we will continue to leverage our resources: strong global base of customers, superior products and talented people, to propel ourselves forward in the marketplace."
For the year ended December 31, 2005, revenues increased 27% to $74.5 million from $58.5 million in 2004. GAAP net income in 2005 was $4.3 million, or $0.27 per diluted share, compared with net income of $2.5 million or $0.16 per diluted share, in 2004. Excluding amortization of intangibles and amortization of capitalized software costs, adjusted net income for 2005 was $7.1 million, or $0.45 per diluted share, compared to $5.0 million, or $0.33 per diluted share, in 2004.
Additional fourth quarter highlights:
-- Fundtech closed 44 new deals and added 3 new bank customers
-- Closed 3 new system sales: 1 Payments and 2 Cash Management
-- In the U.S., closed ASP and disaster recovery services
transactions, which are expected to generate $5.2 million of
revenues over the next five years.
-- Completed the acquisition of Radius Partners.
The financial guidance provided is current as of today only and the Company undertakes no obligation to update its estimates.
For the year ending December 31, 2006 we expect revenues of between $80 million and $84 million, GAAP earnings per diluted share of between $0.19 and $0.28 and adjusted earnings per diluted share, before all amortization expenses and stock compensation expenses, are expected to be in the range of $0.50 to $0.60.
For the first quarter of 2006 we expect revenues of between $19.0 million and $19.5 million, GAAP earnings per diluted share of between $0.00 and $0.01 and adjusted earnings per diluted share, before all amortization expenses and stock compensation expenses, are expected to be in the range of $0.08 to $0.09.
We estimate that amortization expenses in 2006 will be approximately $700,000 per quarter and that stock compensation expenses will be approximately $550,000, or $.04 per share on a fully diluted basis, per quarter.
The company's guidance for the first quarter of 2006 and full-year
2006 assumes no change in the calculation of the Company's tax provision, which currently assumes a full valuation allowance against the Company's deferred tax assets.