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May 3, 2001 Headlines---- "Reports of My Death Are Highly Exaggerated" Comdisco Second Quarter: $8 Million Loss Ken Duffy Remembers Comdisco's Ken Pontikes--- Golden Eagle Leasing Takes Loss Preferred Lease, A CapitalWerks Company ( official ) More Salesman Pay Survey Results ( we hope to put these all together for one major report next week---so if you want to contribute, please do so---anonymous, if you wish ) Intuit Posts Another Record Tax Season/ 5 Million e-Line Tax Return Dun & Bradstreet Partners with Intuit for On Line Services Bankruptcitydata.com--Recommended to You
At the North American Truck Shows: LeaseTrading Introduces: " First and Only Full-Service Marketplace that Brings Liquidity to Vehicle and Equipment Leases" --------------------------------------------------------------------------- United Association of Equipment Leasing Scottsdale, Arizona Conference "I am in Scottsdale at the UAEL conference.It is not particularly well attended, but it has not really begun yet, except for the golf tournaments. The resort is average. Thought you would be here." name with held ( Sorry, there will be a Leasing News workshop with a good group of advisors. We hope to get some reports about the conference...Have two community dinners here and a good friends wedding at Wente Bros. Winery on Sunday. I will be at the NAELB New Orleans Conference for a workshop with the advisors and a special dinner at Emeril's in the Wine Cellar. editor ) ------------------------------------------------------------------- " Reports of My Death Are Highly Exaggerated" No, not Mark Twain---TOM WILLIAMS LeaseExchange, or the company formally known as EquipmentLeasing is still in business!!! We sure did have a rough go at it over the last 6 months and did in fact have to let go of all of our employees including Richard Donat. He is a good man. At the same time I also was going through a divorce with my wife which was extremely painful and I was pretty discouraged about everything. As you know I already owned a leasing company called Paragon Capital which I started in 1995 which was doing some interesting things online in 1997 and was doing very well when I decided in late 98 to start LeaseExchange. LeaseExchange was the brain child of both Aaron Ross and myself. He came from the software world and I came from the leasing side. Aaron is in fact training for the Iron Man and is doing well and still helps out from time to time. Aaron is one of the smartest people I have ever had the pleasure to work with but he did not want to continue with day to day operations with the company once our VC money was gone and it seemed hopeless or maybe even crazy. I put a tremendous amount of time and energy into making this company work so it was very painful for me to see it struggle and fail. I knew we could make money if we changed some things around and reduced the burn. After about 3 months of the company being dormant I decided to rebuild it with my own money and decided not take the offers on the table to sell our code and assets. The system cost over 1.7 MM to develop and launch and I wasn't willing to sell it off for a fraction of the cost. I recommitted to resurrect the company. The site was rebuilt on our old servers (They still work even though they are almost a year old!) If you look close, Leaseexchange redirects to www.123leaseit.com which was our old staging server which will change back to LeaseExchange on the 21st of May. A blessing that made everything come together was that our old engineering team spun off and started a software company and we agreed to contract with them to continue to add functionality to the exchange and maintain the system (They are intact) This is not cheap but a lot cheaper than 15 engineers on salary. Since they are shareholders they were willing to continue to consult with us and maintain and develop new functionality. The site is working and we are doing deals (Our Verisign certificate has expired and will be fixed on the 21st when we launch our new release) but other than that we are going for it and booking deals. The new release will have much more functionality and easier to management deal flow on the lessor side. We have hired 2 new sales people last month and expect to add another 3 before July. They are working out of my work/live space which is commercially zoned in San Francisco. It isn't the best scenario but it is inexpensive and the people I have hired believe in what we are doing and will move to back to a traditional building in a few months. We would have done is earlier but rentals keep going lower and lower... People at start ups always say I was #5 and so on in terms of when they started with the company. Here we added A.D.(After Death) to each one to signify the rebirth of the company. We are also opening an East Coast office in September located within Miami. We are not in the business of selling vapor ware or bragging about our technology and talking about how it will change the world. We are in the business of booking leases and making money for us, our vendors, and funding sources. Our system works, and our vendors are using it and so are our customers. We are out in the market actually doing leases. You need to be in the market to find out how this is all going to play out. We are and learning more and more about the power of the web and its shortfalls. I have been wrong more than I have been right but online you can only learn by doing. There is no exact science. If there was a book we all would have bought it. It is being written everyday. I guess what I am saying is that I wouldn't count us out. There will be one major difference between LeaseExchange and most of the other internet players in a few months. LeaseExchange will be profitable. Yours Truly, Tom Williams, CEO LeaseExchange tom@leaseexchange.co ----------------------------------------------------------------- 65 Employers---Not a Massacre Here ! ! ! Well, I would argue that "eLeasing Companies" have or are going the way of LeaseExchange. Equidity is a technology company that has created a credit origination platform to facilitate multi-channel credit origination for Financial Institutions and credit origination, coupled with a funding network, for vendor finance programs. Our genesis was EqualFooting, a small business marketplace for lending products, ala LiveCapital. Today, we are selling our infrastructure to financial institutions and fortune 2000 vendors. You can check out our web site at www.equidity.com. We have raised $70 million to date and have lending partners like: MBNA, Wells Fargo, and CIT. Yes, it is a crowded space. But we will be one of the last ones standing. Rumors have it that eCredit is down to its last 2 months of cash. Equidity, LiveCapital, and CapitalStream will most likely survive the shake out. Cheers, John Long John.Long@Equidity.com ( We will be adding Equidity with their 65 employees to our eLease list. editor ) --------------------------------------------------------------- Banruptcity Data On Line At the National Association of Equipment Leasing Brokers Conference in New Orleans, there will be a workshop of web sites for the leasing industry. This is one that I will recommend, as it is the third site to learn more about Dot Com's demise. This covers all bankruptcy: www.BankruptcyData.com. This provides in-depth information on business bankruptcies. The current free dotcom bankruptcy filing list now contains over 90 companies that have filed bankruptcy since November 2000, including Toysmart.com, Wine.com, Furniture.com and Office.com. There also is a paid section, where "Premium subscribers" to the BankruptcyData.com have access to the date each dotcom company has filed, in addition to where, when, and the attorney contact information. The site also offers continued coverage of the public dotcoms that have filed for bankruptcy. The free dotcom bankruptcy list is updated everyday and contains companies with ".com" in their name that have filed bankruptcy in the United States. The web site provides free bankruptcy news, information on the U.S. Bankruptcy Courts and links to the court web sites. Premium subscribers have access to filing information on every business filing bankruptcy in more than 80 federal districts. The coverage contains contacts, case number and court where the company filed. The business filing database now contains information on over 10,000 business filings. BankruptcyData.com (www.BankruptcyData.com) is designed for bankruptcy and credit professionals attempting to sift through endless research material. The site provides a wealth of news, financial history, creditor information, reorganization details and other data for over 700 publicly-traded companies. BankruptcyData.com has been accumulating this critical bankruptcy information since 1986. The site contains complete information on public company bankruptcies dating back as early as 1993, and further expansion is ongoing. The extensive public company database can be searched at no charge by assets, Chapter 11 filing date, industry or company name. www.BankruptcyData.com is a product of New Generation Research, Inc., a leading bankruptcy research firm founded in 1986. Since its inception New Generation Research has tracked all publicly-traded companies with assets over $50 million throughout their entire bankruptcy program. ----------------------------------------------------------------- ########################################### Comdisco, Inc. (NYSE:CDO) today reported operating results for its second quarter ended March 31, 2001. Operating results: Primarily as a result of recording additional reserves for credit losses for its Ventures operations, Comdisco reported a loss from continuing operations of $8 million, or $.05 per common share, compared with earnings from continuing operations of $71 million, or $.44 per common share, for the year earlier period. Overall, the company had a net loss of $54 million, or $.35 per common share, compared with net earnings of $43 million, or $.26 per common share, for the year earlier period. Total revenue for the quarter was $940 million, compared with $1.0 billion for the prior year period. For the six months ended March 31, 2001, the company reported earnings from continuing operations of $82 million, or $.53 per common share, compared to $131 million, or $.80 per common share. Overall, the company had net earnings of $34 million, or $.22 per common share, compared to net earnings of $84 million, or $.52 per common share, for the prior year period. Total revenue for the six months ended March 31, 2001, was $1.84 billion, versus $1.87 billion, for the prior year period. CEO commentary: "Since joining Comdisco, I have worked with senior managers and advisers to review the company's businesses," said Norm Blake, the company's newly appointed chairman and chief executive officer. "It became apparent during this review that we needed to evaluate our strategic options. Specifically, it is clear that the growth and profitability of our core businesses have been challenged by the cost and availability of funds, as well as structural costs. In addition, the company incurred higher interest costs, which in part, are associated with the debt incurred to finance discontinued operations. Moreover, it was necessary to take additional write-offs and reserves associated with the previously announced decisions to exit Prism Communication Services and Network Services. We believe the charges taken with respect to Comdisco Ventures were necessary given the recent and rapid decline in the economic environment for venture capital-backed companies. Comdisco continues to honor funding commitments to which it is obligated. We also have worked to strengthen Ventures' management and credit practices to maximize value. During the review process, we have retained the services of Goldman, Sachs & Co. and McKinsey and Company to advise us in considering various strategic alternatives that best serve the interests of our stake holders. That process is continuing. Given the sensitivity of these matters, we are not at liberty at this time to disclose the process or timing of these actions. While the company's core businesses in leasing and in services remain sound, Comdisco will not achieve the level of earnings previously forecast primarily as a result of changing economic conditions, the credit quality of the Ventures portfolio, our cost of funds, limited access to the company's traditional funding sources, and other developments. Having recently arrived at Comdisco and with our initial strategic review still underway, I am not prepared to provide any earnings guidance regarding the company's current fiscal year at this time," Blake said. Explanation of Charges: During the second quarter of fiscal 2001, the company initiated a strategic review of all business segments. As a result of this review and deteriorating market conditions, it was determined that write-offs and reserve provisions should be recorded for certain assets of its Ventures operation. In addition, additional reserves and write offs were taken relative to the exit costs of Prism Communication Services and Network Services. Continuing Operations: Ventures: The company determined that approximately $206 million of additional reserves for Ventures portfolio credit losses were required. The company wrote off approximately $100 million of non-performing loans during the quarter, leaving a balance of $210 million in the reserve for credit losses as of March 31, 2001. Discontinued Operations: Prism: The company re-evaluated its estimated proceeds from the sale of certain assets of its discontinued Prism operations, based primarily on current market conditions for such assets. As a result, the company recorded a noncash pre-tax charge of $30 million, $18 million after tax, or $.12 per common share, to write down these assets to current estimated fair market value. Loss from discontinued operations of Prism for the three and six months ended March 31, 2000 was $26 million, or $.16 per common share, and $43 million, or $.26 per common share, respectively. Network Services: Network consulting has been terminated and the network management services are being transferred to a new provider. The termination and transfer resulted in a pre-tax charge of $38 million, $24 million after tax, or $.15 per common share. The current quarter pre-tax loss from discontinued operations was $7 million, $4 million after tax, or $.03 per common share compared to a loss of $2 million, or $.02 per common share, in the year earlier period. Loss from discontinued operations of Network Services for the six months ended March 31, 2001 and 2000 was $8 million, or $.05 per common share, and $4 million, or $.02 per common share. Dividend Information: On May 2, 2001, the Board of Directors voted to suspend the payment of quarterly dividends on its common stock until the company's liquidity and capital position warrants the resumption of dividend payments.
About Comdisco Comdisco (www.comdisco.com) provides technology services worldwide to help its customers maximize technology functionality, predictability and availability, while freeing them from the complexity of managing their technology. The Rosemont, (IL) company offers a complete suite of information technology services including business continuity, managed web hosting, storage and IT Control and Predictability Solutions SM. Comdisco offers equipment solutions to key vertical industries, including semiconductor manufacturing and electronic assembly, health care, telecommunications, pharmaceutical, biotechnology and manufacturing. Through its Ventures division, Comdisco provides equipment leasing and other financing and services to venture capital backed companies. The company's revenue for the twelve months ended March 31, 2001 was $3.8 billion. CONTACT: Comdisco, Inc. Records Second Quarter Loss Resulting From Write-Offs and Reserve Additions; Suspends Quarterly Cash Dividend
############################################ ------------------------------------------------------------------ Comdisco's Ken Pontikes---Remembered As you know, I don't often comment but I believe you are doing a great service to this industry on many levels and felt a word on the tragic events at Comdisco is merited. I knew Ken Pontikes, the now deceased CEO and founder of Comdisco. We grew up in the same blue collar South Chicago neighborhood and neither of us inherited a dime. We started our businesses at about the same time. He grew huge, I grew small but we both survived and thrived. In 1981 or 82 we attended a charity event with our wives. We had both been Sox fans until the early 60s when the franchise went down. But in '81-2 we were following da Cubs. At the charity event they were auctioning an original pennant, one of 14 that flew atop Wrigley Field and carried the "WF" crest. The flag was tattered but that didn't matter to us. I out bid Ken that nite $600. to $575. and got the flag! Everybody knew who he was but not many knew me. The bidding was fun and raucous. At the end Ken went to the prize lady and said, "I'd like one too, and I'll match Duffy's bid if you can work it out". Since one of the event chairladies was a Wrigley, Ken got his flag and Infant Welfare got double the money. He probably gave them another $10k that no one ever knew about. A hard nosed businessman but a terrific guy. Ken's son took over after his untimely death two years ago. And as many sons do, he thought he was "entitled" to run one of the finest companies ever built. My guess is he was either scared to death or astoundingly arrogant. The story of his missteps is public and tragic. His $300 million dot.com investment is today worth $1.83 if that. He resigned as CEO a few weeks ago, finally admitting he was in over his head. Today he placed 2.5 million Comdisco shares for sale and will exit stage left with $25 or so million, if he's lucky, that he had nothing to do with earning. And behind him for all intents and purposes lies a bankrupt shell. Just wanted to remind people that what Comdisco has become is not what it's founder intended nor did he cause. Raise a glass to Ken Pontikes, a legend in our time. (get a jug from Foremost Liquors, it's easier than wine.com). Have a nice day. Ken Duffy kduffy@summitnational.com
------------------------------------------------------------- Mark Seif---Preferred Lease, A CapitalWerks Company The rumor making the rounds that Mark Seif has left Preferred Capital because he won $300,000 in Las Vegas is not completely true. "No truth to most of it. I did go to Vegas to play in the World Series of Poker. I had a good trip. I am currently there now competing in World Series events daily." Mark Seif This information was also received: "He has made the decision to open his own law practice and will continue to represent Preferred Lease, A CapitalWerks Company. As far as his winnings in Vegas, I'm glad someone can finally bring some of their good luck back to the California economy. Please leave my name out of this. Thanks" Name With Held
------------------------------------------------------------- More Salesman Pay Survey We will compile all this information eventually into one report. If you send in your information, we will not quote you, unless you specifically allow us, and we will verify that with you so we do not make a mistake. Your name and company will be held confidential. #1 Lessor I work for a leasing sub. of a large foreign bank.Mostly small ticket. Bases are in the 30's-40's depending on experience. We get .008 of volume with a kicker on spreads that exceed 650 over. Quotas are $6mm-10mm depending on territory.
Discounter/SuperBroker #1 From your survey it appears that we may be giving the shop away. We have a very simple commission only program. As a small to mid ticket lessor broker/discounter we pay 50% of the gross fee on the transaction. Higher amounts up to 60% are paid to consistent producers, We pay every Friday for deals that fund that week. We provide complete office and back room processing and pay for all internal costs such as D&B, CBR, rent, phone, overnight etc.. Salesman pay for all external costs such as entertainment and travel. We share in all promotional and trade show expenses. We will work with established, proven producers for a few months should a draw be necessary and we are always interested in finding new talent. Len Sperl, Onyx Capital Corp, Pittsburgh Pa. occ@sgi.net #2 Here in Minneapolis at NFG our sales reps earn 50% of GP on all transactions. We provide office, phone, internet, marketing and trade show reimbursement. We have a credit, documentation and funding staff to handle most of the non-selling processes. In addition we do a draw on future commissions if a rep is new. Our monthly bonus plan is $240 over $7500 (which is the reps 1/2) and $600 over $10,000 . Quarterly bonus is $720 over $22,500 and $1800 over $30,000. If a rep hits $100,000 annually then the company provides a $600 per month car reimbursement for the entire next year. We feel we have an aggressive compensation package because we want all of our people to succeed. We are nothing without our people who got us here. Oh yeah we also have a condo in Vail available to all our staff and reps to use at no cost. We are currently attempting to create a way to pass ownership to super stars as well, but have not finalized it as of yet. Keep the info flowing. Best Regards, Willi Abbott President Northland Financial Group, Inc. Direct (952) 746-5251 888-485-5834 Fax (952) 979-1590 email wabbott@northland-financial.com www.northland-financial.com #3 When I had my own shop we employed a very simple formula. Salespeople were given a draw against commissions. This was like a salary but they had to earn in excess of that amount to receive commission income. Draw was initially $30,000, paid in bi-monthly installments of $1,250. Commission rate was 30% of the gross profit on a transaction. Gross profit was the PV of the discounted stream plus advance rentals less the equipment cost and less any referral fees or points we had to pay out. Salesman did not receive a sharing on documentation fees and the fee was not charged for booking fees, lien searches or asset inspections assessed or required by funding sources. If we bought the deal for our own account, the "house" simply established a required portfolio yield and the deal was discounted at that yield rate to arrive at the gross profit. All salespeople were W-2 employees. That meant we paid all taxes including social security and unemployment tax. Salespeople received 100% health insurance and dental. The company paid all expenses including 30 cents per mile traveled. Air travel, trade shows, etc. had to be approved before the amount was expended. We paid cell phone costs up to a certain percentage of their monthly fee income - I believe it was 1% or 2%. If we didn't discount the residual, as long as the sales person was continually employed through the time the residual was collected, they received their 30% sharing upon collection. If a new deal came in direct from an existing lessee, the deal was directed to the salesman that brought in that lessee initially. The company helped with vendor development. Salespeople were not treated like independent agents. For out of state sales people who worked from their home, we provided all equipment and paid for the business phone, fax and 800 line. Typical budgets (of gross profit / fee income) were in the $20,000 to $30,000 monthly range. Commissions were paid on the 15th of the following month. So.... A sales rep received $1,250 as draw on January 15th and another $1,250 on January 31st. (The first $8,333 of gross profit will go against the January draw.) If the sales rep generated $22,000 of gross profit in January, the commission would be $22,000 x 30% = $6,600. From there we subtract the $2,500 advanced via the January draw leaving a $4,100 commission check due February 15th. On February 15th the sales rep received 2 checks, their $1,250 February draw check and the $4,100 commission for January. We believe that 30%, plus expenses plus benefits plus direct costs (marketing, long distance, etc.) brings the comp cost into the mid 40% range. That leaves about 50% to cover conventional overhead - credit analyst, CBR's, D&B's, documentation person, etc. Massachusetts broker -------------------------------------------------------------- PinnFund USA Pinn Leasing Hi Kit, I think that Larry Turner is just trying to cover his own mistakes by blaming everything on Tommy Larsen. I have known Tommy Larsen for years and all the deals I sent to Pinnlease were handled perfect without any problems. When Pinnlease closed, Tommy Larsen lost his job and now Larry Turner is just kicking a man there's laying down. Give me a break. I love your site Leaseman MC CLP leasemanflorida@hotmail.com ######################################### LeaseTrading, Inc. Introduces First and Only Full-Service Marketplace that Brings Liquidity to Vehicle and Equipment Leases at North American Truck Show
BOSTON--(BUSINESS WIRE)--May 3, 2001-- LeaseTrading Creates Single, Cost-Effective Source to Facilitate Transfer of Leases for Businesses and Individual Users in Burgeoning Secondary Lease Market Today at the North American Truck Show, LeaseTrading (Booth #1526) made its debut and introduced the first and only full-service, independent marketplace for the transfer of commercial vehicle and equipment leases. Serving North America and supported by its expert-managed trading desk, the LeaseTrading marketplace, located at www.leasetrading.com, facilitates the transfer of leases for not only trucks and automobiles, but also construction, office, computer and medical equipment. Using its proprietary technology, LeaseTrading manages all aspects of the transfer process from initial listing of assets to exchange negotiation and contact with credit institutions and, finally, to logistics arrangements and asset delivery. The benefits for leasing industry participants are powerful: -- Acquirers of equipment and vehicles can locate and lease high-quality assets on attractive terms. -- Leasing companies, through LeaseTrading's risk management program, have a new and powerful alternative for managing their lease portfolio credit experience. Additionally, by addressing one of their customers' greatest concerns, LeaseTrading helps leasing companies improve sales and customer service. -- Lessees now have greater term flexibility and an alternative to defaults and expensive penalties. -- Dealers and brokers have a new tool to complete more transactions and grow their business. After dealers and brokers assist prospective customers with exiting an existing lease, they are able to purchase a new asset. "LeaseTrading drives and enhances the lease transfer process, and is a tool critical to the management of risk. The ability to transfer a lease can mean the difference between bankruptcy and viability for a business or individual and the difference between a performing and a non-performing asset for a leasing company," said Michael D. Penfield, founder and CEO of LeaseTrading. "Especially in the competitive trucking industry, fleets, owners and operators can take advantage of this credible alternative to the dilemma of expensive termination of penalties and potential bankruptcies." "Cyclical industries face punishing inflexibility when attempting to generate liquidity of their leased assets, especially in an industry downturn or a recession," said Andy Katz, vice president and managing director, e-Business Applications and Markets, Aberdeen Group. "LeaseTrading has created a reliable, full-service and vendor-neutral e-marketplace where lessees can increase liquidity of their leased assets and lessors can maximize their risk management opportunities as well as efficiently find new customers. The secondary leasing marketplace, pioneered by LeaseTrading, is a credible alternative to otherwise writing off lost revenues, payment default and the prospect of expensive penalties when buying assets in mid-lease stage." Executive Management Team LeaseTrading's executive team comprises the best minds in leasing, financial services and technology that made the concept of a neutral, independent secondary leasing marketplace a reality: -- Michael D. Penfield - president and CEO, co-founder of LeaseTrading - Michael is responsible for developing company strategy. Michael spent 16 years working primarily as an investment banker at Citigroup, Merrill Lynch as well as merchant bank The Lodestar Group. Michael previously headed financial institutions investment banking as managing director at SG Cowen. -- Brooks Ritchey - executive vice president and chief operating officer, co-founder - Brooks has daily financial/fiduciary management responsibility for LeaseTrading. He has over 18 years of experience in the investment analysis and portfolio management areas working with such companies as Citicorp, AIG, Steinhardt Partners, Paribas, and ING Furman Selz. -- Jeffrey D. Schmidt - senior vice president, Marketing and Trading, co-founder - Jeff is responsible for all aspects of online and offline trading, as well as coordinating marketing communications, public relations and advertising campaigns. He has over 18 years of diversified financial markets experience from his positions at Discount Corporation of New York, Bear Stearns, Credit Lyonnais and Credit Suisse First Boston. -- John L. Guadagno, Jr. - managing director, Business Development - John is responsible for developing business development and has over 25 years of experience in the commercial finance industry. Prior to its sale to GECC (GE Capital Corporation), he spent five years as President and CEO of Phoenixcor, the commercial finance operations of Sumitomo Corporation of America. -- Robert F. Cunningham - managing director, Business Development - Bob manages LeaseTrading's growing West Coast operations, based in San Mateo, CA. He brings over 20 years experience in leasing and structured finance from such companies as Key Global Finance and Citicorp Bankers Leasing Corporation, a wholly-owned subsidiary in the Global Equipment Finance division of Citicorp North America. About LeaseTrading, Inc. LeaseTrading, Inc. has created the first and only full-service, neutral market for the transfer of equipment and vehicle leases, bringing liquidity to businesses and individuals and risk management opportunities for lessors. Offering an efficient and cost-effective alternative to exiting a lease, LeaseTrading has established the first and only online marketplace for transferring equipment and vehicle leases from a current lessee to a new lessee. Serving North America and supported by its expert-managed trading desk, the Lease Trading marketplace, located at www.leasetrading.com, facilitates the transfer of leases for not only trucks and automobiles, but also construction, transportation, office, computer and medical equipment. Using its proprietary technology, LeaseTrading manages all aspects of the transfer process from initial listing of assets to exchange negotiation and contact with credit institutions and, finally, to logistics arrangements and asset delivery. LeaseTrading's one-stop solution provides existing lessees with greater term flexibility and offers an alternative to defaults and expensive penalties, while new lessees can acquire high-quality assets at attractive rates. With this new secondary market option from LeaseTrading, lessors better manage default risk, reduce expenses, ensure that leases mature and maintain strong customer relations. Over the last year, LeaseTrading has already completed two rounds of financing; current investors include a strong cadre of senior executives from world-leading technology and financial services companies. Lessors, vendors, current and new lessees can list their assets for free and start taking advantage of LeaseTrading's full-service capabilities or find out more information through the Internet at http://www.leasetrading.com and contacting the trading desk at 1-(888) 280-9009. ########################################## --------------------------------------------------------------- Golden Eagle Leasing Takes Loss ( Their spin on the story ) ########################################## Hypercom Corporation Announces First-quarter Results; Meets Operating Targets for Core Point-of-Sale Business
PHOENIX--(BUSINESS WIRE)--May 3, 2001--Hypercom Corporation (NYSE:HYC): Highlights: -- Turnaround plan yields solid results; improved operations -- Positive EBITDA before charges -- Backlog at record $163 million -- Large contracts for new products signal acceptance of ePic (ePOS-infocommerce(TM)) technology -- Bank debt reduced by $17.6 million -- Current lending group extends forbearance agreement to May 15, 2001 Hypercom Corporation (NYSE:HYC) today announced financial results for the three months ended March 31, 2001. Net revenues were $71.1 million compared to $77.3 million in the year-ago period. In spite of incurring turnaround costs, the Company also reported EBITDA (earnings before interest, taxes, depreciation and amortization and a charge to strengthen credit reserves for certain segments of the Golden Eagle Leasing lease receivables, as well as banking charges related to the forbearance and seeking new financing) of $714,000. This was substantially in line with management's expectations. The net loss for the quarter in the core point-of-sale unit, exclusive of the losses incurred for currency translation and banking charges related to the forbearance and seeking new financing, was $4.2 million, or a $0.12 loss per both basic and diluted earnings per share. This is in line with previously announced, company-provided guidance. The net loss for the quarter in the equipment leasing unit, exclusive of banking charges related to the forbearance and a charge to strengthen credit reserves for certain segments of the Golden Eagle Leasing lease receivables was $287,000 or $0.01 loss per both basic and diluted earnings per share. "Our turnaround plan is yielding solid results," said Christopher S. Alexander, president and chief executive officer, Hypercom Corporation. "The large operational improvements we are seeing in our core POS business reflect the success of our efforts to improve margins of our new ePic ICE(TM) products, as well as their increasing customer acceptance. ePic is accelerating our move toward market leadership, building on our established base of terminals in more than 100 countries, and leveraging our technology partnerships with new and existing customers. "As a reflection of the greater demand for these next-generation, advance technology Internet-enabled ePic terminals, backlog currently stands at approximately $163 million, up from $158 million at the end of the fourth quarter of 2000. This means we are receiving replacement orders at a faster pace than we are shipping. "On a worldwide basis, we signed several significant contracts to deliver services in addition to terminals. We introduced the ePic ICE 5700 card and check payment terminal with integrated motorized check reader. Our Visual HDT (VHDT) C++-based software, which uses Microsoft(R)'s popular Visual Studio(TM) open development platform, is being adopted by software developers to quickly and cost-effectively develop value-added applications for merchants. We also opened an office in Toronto to meet the increasing demand for our products and services in Canada. Including the strengthening of reserves against Golden Eagle Leasing lease receivables ($7.2 million, $5.7 million net of tax, or $0.17 per share), and currency translation losses and unusually high costs related to interest expense and other banking-related charges due to the forbearance and seeking new financing ($3.8 million, $3.0 million net of tax, or $0.09 per share), the net loss for the quarter ended March 31, 2001 was $13.3 million, or $0.39 loss per basic and diluted earnings per share. This loss compares to a net loss in the year-ago period of $3.9 million, or $0.11 loss per both basic and diluted earnings per share, including net losses related to Hypercom's investment in Cirilium Corporation, a voice-over Internet Protocol (VoIP) company in which Hypercom accounted for its holding on the equity method until September 30, 2000. "The company took a very conservative approach to valuing the Golden Eagle lease portfolio with the $7.2 million loss reserves," said Alexander. "This should allow Golden Eagle to be profitable for the remainder of the year. "Unfortunately, the company's inability to hedge during the quarter, the high costs associated with our efforts to secure alternate financing, and the need to strengthen reserves against lease receivables from our Golden Eagle Leasing operations, have overshadowed the excellent progress we made in the core business," said Alexander. "But we want to reiterate that on an operational level, we are on track with our continuing efforts to reduce costs, sequentially improve gross margins and streamline the company," he said. For the three months ended March 31, 2001, research and development expense decreased 22 percent to $8.3 million from $10.7 million in the year-ago period and decreased 13 percent from $9.4 million in the fourth quarter of 2000. Selling, general and administrative expenses decreased 6 percent to $21.5 million from $22.8 million in the year-ago period and decreased 14 percent from $24.9 million in the fourth quarter of 2000. Gross margins were 35.4 percent, down from 39.7 percent in the year-ago period but up from 34.9 percent in the fourth quarter of 2000. In addition, the company reduced its bank debt by $17.6 million during the quarter. The company also received a second extension to its forbearance agreement with its current bank group, which is effective until May 15, 2001, as it seeks to complete alternate financing. Outlook As stated previously, the company expects results of operations to improve sequentially each quarter and to return to profitability during the latter part of the year. The company anticipates revenues for the second quarter, which ends June 30, 2001, to be in the range of $72 - $76 million and expects income from operations to be at least break even, which should yield approximately $0.05 ########################################## --------------------------------------------------------------- ########################################## Dun & Bradstreet and Intuit to Offer New Suite of Online D&B Services to Small Business Owners
MURRAY HILL, N.J. & MOUNTAIN VIEW, Calif.--(BUSINESS WIRE)--May 3, 2001-- Dun & Bradstreet Launches Small Business Services, Millions of QuickBooks Customers to Have Access to Business Information Tools Dun & Bradstreet (NYSE: DNB), the world's leading provider of business information, and Intuit Inc. (NASDAQ:INTU), a leader in small business financial management solutions, today announced a strategic initiative to offer small businesses a new suite of Web-based D&B business services. The agreement will bring D&B's information and customized technology solutions to a new and virtually untapped small business market and will provide QuickBooks(R) small business customers with information and tools that can help them make better, more informed business decisions. The D&B business services are expected to be available later this year via QuickBooks.com and are to be integrated into the next version of QuickBooks software. The D&B services capitalize on the company's expertise in Web-based data delivery and a new distribution channel through QuickBooks. The services are specifically designed and positioned for small business customers and provide online access to D&B information to help small business owners find profitable new customers, manage vendors more efficiently, run instant online credit checks and perform self-evaluations and competitive analyses. The services will be specifically priced to appeal to the small business owner. "Through our relationship with Intuit, small businesses can easily access the new D&B small business services to help make their businesses more successful," said Allan Loren, Dun & Bradstreet Chairman, Chief Executive Officer and President. "Our relationship with Intuit positions us with a market leader in small business services and provides an exciting new online distribution channel for D&B. Launching these new small business services furthers D&B's Blueprint for Growth strategy to enhance our current business, leverage the Web and introduce solutions that enable B2B commerce." According to recent internal Intuit studies, nearly 50% of QuickBooks' customers report financial losses each year due to uncollected account receivables and nearly 20% report an annual loss of more than $1,000 - an estimated aggregate total of $600 million annually for the entire QuickBooks customer base. "One of the most serious problems facing small businesses is getting paid-- if they don't, they're out of business," said Scott Cook, Co-Founder and Chairman of the Executive Committee, Intuit. "Through Dun & Bradstreet's credit management expertise, QuickBooks users will soon be able to quickly access their customers' credit ratings as well as evaluate their own financial position." D&B services will be made available to the nearly three million small business customers currently using QuickBooks software. According to recent internal Intuit studies, approximately 80 percent of QuickBooks customers have some business-to-business activity and more than half of these customers have been identified as having a potential need for credit management services. In total, QuickBooks customers send more than 1.2 billion invoices to their customers each year. QuickBooks small business customers, which range in size from 1 to 200 employees, use QuickBooks financial management software an average of 60 hours a month. QuickBooks financial management solutions currently include a merchant credit card service; online invoice presentment and payments; online banking through more than 40 financial institutions; and small business leasing and loans. About Dun & Bradstreet Dun & Bradstreet (NYSE:DNB), the world's leading provider of business information, has been enabling business-to-business commerce for nearly 160 years. D&B's information and technology solutions help businesses reduce credit risk, find profitable customers, manage vendors efficiently and collect cash and receivables. Businesses also use D&B's information and technology to authenticate and verify potential trading partners online, increasing their trust and confidence in e-commerce transactions. That's why so many companies -- including over 90 percent of the Business Week Global 1000 -- rely on D&B as the most trusted source for information they need to make their business a success. For more information, please visit www.dnb.com. About Intuit Intuit Inc. (NASDAQ: INTU) is the leading provider of financial software and Web-based services for consumers, small businesses and accounting professionals. Its flagship products and services, including Quicken(R), QuickBooks(R), Quicken TurboTax(R) and Quicken Loans(R) simplify personal finance, small business management and payroll processing, tax preparation and filing, and online consumer mortgages. Founded in 1983, Intuit has annual revenues of more than $1 billion and reaches 22 million customers with nearly 5,000 employees in 13 states and four countries. More information can be found at www.Intuit.com. Intuit, the Intuit logo, Quicken, QuickBooks, QuickBooks Pro, TurboTax and ProSeries, among others, are registered trademarks and/or registered service marks of Intuit Inc. in the United States and other countries. Quicken.com, QuickenInsurance, Quicken Loans and Lacerte, among others, are trademarks and/or service marks of Intuit Inc., or one of its subsidiaries, in the United States and other countries. Other parties' trademarks or service marks are the property of their respective owners and should be treated as such. dors. #################################################± Intuit Posts Another Record Tax Season
SAN DIEGO-- TurboTax desktop software grows share of revenue and units at retail; TurboTax for the Web reaches 2.4 million federal returns; Company e-files more than 5 million federal returns Speaking before investors at the J.P. Morgan H&Q 29th Annual Technology Conference in San Francisco, Steve Bennett, president and chief executive officer of Intuit Inc. (NASDAQ: INTU) today announced another record tax season. "Intuit had an excellent tax season - we aced every aspect of our strategy and delivered outstanding results," said Bennett. "In an intensely competitive environment, we grew our units sold at retail by eight percent, resulting in one full percentage point growth in retail unit share, despite an increase in prices. We also grew desktop software revenue at retail more than 27 percent, driving growth of retail revenue share to just over 80 percent, up eight percentage points over last year." Bennett noted that Intuit also had a banner year on the Web. The company started the season with prices for Quicken(R) TurboTax(R) for the WebSM, the leading online tax preparation and filing service, 50 percent higher than the previous year. After April 1, prices increased again - double last year's price, and a record 2.4 million federal returns were prepared, an increase of 71 percent over last year. Revenue from online tax preparation grew even more dramatically, up more than 130 percent over the prior year, powering tremendous growth for the company's tax business. The company also reported that five million electronically filed personal federal returns were accepted by the Internal Revenue Service through Intuit's TurboTax desktop software and TurboTax for the Web, up from 3.9 million last season. According to the IRS, 6.6 million self-preparers used a home computer to electronically file their return this year. Self-prepared returns electronically filed through TurboTax desktop and Web programs accounted for 75 percent of those returns.
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