EX-99 3 a4469932ex99.txt EXHIBIT 99.1 PRESS RELEASE Exhibit 99.1 Carreker Corporation Reports Second Quarter Fiscal 2003 Results; Company Returns to Profitability DALLAS--(BUSINESS WIRE)--Sept. 10, 2003--Carreker Corporation (Nasdaq:CANI), a leading provider of payments technology and consulting solutions for the financial services industry, today reports revenues of $36.2 million for the second quarter ended July 31, 2003, compared with $28.3 million in the first quarter fiscal 2003 and $43.5 million in the second quarter of fiscal 2002. The Company reports net income of $3.9 million, or $0.17 per share (basic and diluted), for the second quarter fiscal 2003, which compares with a net loss of $3.0 million, or $0.13 per share (basic and diluted), for the first quarter fiscal 2003, and net income of $7.9 million or $0.34 (basic) and $0.33 per share (diluted) in the year ago quarter. "Our strong second quarter combines with a disappointing first quarter to return us to profitability for the six months," said J.D. (Denny) Carreker, Chairman and Chief Executive Officer of Carreker Corporation. "Our positive cash flow for this period permitted us to further reduce debt during the quarter while maintaining the strong cash balances and adequate additional borrowing capacity to allow us to continue to invest in our future growth." Conference Call Management has scheduled a conference call today, Wednesday, September 10, 2003, at 5:00 p.m. Eastern Time. The conference call is intended to provide a forum for a discussion of the Company's second quarter fiscal 2003 financial results, business conditions, industry trends and other points of interest to investors. To join the conference call, domestic participants dial 800-361-0912, international participants dial 913-981-5559. A replay of the call will be available on Wednesday, September 10 from 8:00 p.m. Eastern Time through Tuesday, September 16 at 11:45 p.m. Eastern Time. To access the replay, domestic participants dial 888-203-1112, international participants dial 719-457-0820. All replay participants enter the pass-code 488891. Webcast A live webcast of the conference call, as well as the archive webcast, will be available through the investor relations (IR) section of the Company's website at http://ir.carreker.com. The webcast will also be distributed over Shareholder.com's Open Distribution Network. About Carreker Corporation Carreker Corporation improves earnings for financial institutions around the world. The company's integrated consulting and software solutions are designed to increase clients' revenues and reduce their expenses, while improving security and increasing the value of their customer relationships. Carreker provides products and services to more than 250 clients in the United States, Canada, the United Kingdom, Ireland, Australia and South Africa. Clients include the full range of community, regional and large banks, among them more than 75 of the largest 100 banks in the United States. Headquartered in Dallas, Texas, since 1978, Carreker Corporation also has offices located around the world including London and Sydney. For more information, visit www.carreker.com. Forward Looking Statements - Except for historical information, the statements in this release contain forward-looking statements within the meaning of the federal securities laws. These statements are subject to numerous risks and uncertainties that could cause actual results to differ materially, including but not limited to the volatility in the Company's common stock price and litigation related to the Company's restatement of its financials, as well as the risks and uncertainties arising out of economic, competitive, governmental and technological factors affecting the Company's operations, markets, services, products and prices. For further information concerning certain of these risks and uncertainties, see under the caption "Business - Risk Factors" in the Company's most recent Form 10-K for the year ended January 31, 2003. We assume no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by law. CARREKER CORPORATION Condensed Consolidated Balance Sheets (Unaudited) (In thousands, except per share amounts) ASSETS July 31, January 31, 2003 2003 ------------ ----------- Current assets Cash and cash equivalents $ 27,460 $ 26,986 Accounts receivable, net of allowance of $1,629 and $1,761 at July 31, 2003 and January 31, 2003, respectively 17,065 22,759 Prepaid software royalties 364 763 Prepaid expenses and other current assets 2,561 3,073 ------------ ----------- Total current assets 47,450 53,581 Property and equipment, net of accumulated depreciation of $16,048 and $14,704 at July 31, 2003 and January 31, 2003, respectively 7,839 8,975 Capitalized software costs, net of accumulated amortization of $10,571 and $10,025 at July 31, 2003 and January 31, 2003, respectively 1,464 2,010 Acquired developed technology, net of accumulated amortization of $8,927 and $6,867 at July 31, 2003 and January 31, 2003, respectively 15,273 17,333 Goodwill, net of accumulated amortization of $3,405 at July 31, 2003 and January 31, 2003 21,193 21,193 Customer relationships, net of accumulated amortization of $3,033 and $2,333 at July 31, 2003 and January 31, 2003, respectively 5,367 6,067 Deferred loan costs, net of accumulated amortization of $892 and $676 at July 31, 2003 and January 31, 2003, respectively 816 576 Other assets 420 373 ------------ ----------- Total assets $ 99,822 $ 110,108 ============ =========== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Accounts payable $ 509 $ 725 Accrued compensation and benefits 7,412 7,603 Other accrued expenses 4,422 6,030 Income tax payable 100 -- Deferred revenue 22,614 17,600 Accrued merger and restructuring costs 2,668 3,735 ------------ ----------- Total current liabilities 37,725 35,693 Long-term debt 12,500 25,000 Deferred revenue -- 817 ------------ ----------- Total liabilities 50,225 61,510 ------------ ----------- Contingencies Stockholders' equity Preferred stock, $.01 par value: 2,000 shares authorized; no shares issued or outstanding -- -- Common stock, $.01 par value: 100,000 shares authorized; 23,792 and 23,574 shares issued at July 31, 2003 and January 31, 2003, respectively 238 236 Additional paid-in capital 104,784 105,263 Accumulated deficit (55,422) (56,386) Less treasury stock, at cost: 1 and 27 common shares at July 31, 2003 and January 31, 2003, respectively (3) (515) ------------ ----------- Total stockholders' equity 49,597 48,598 ------------ ----------- Total liabilities and stockholders' equity $ 99,822 $ 110,108 ============ =========== CARREKER CORPORATION Condensed Consolidated Statements of Operations (Unaudited) (In thousands, except per share amounts) Three Months Ended Six Months Ended July 31, July 31, ------------------- ------------------ 2003 2002 2003 2002 --------- --------- --------- -------- Revenues: Consulting fees $ 8,202 $12,946 $14,953 $22,541 Software license fees 8,351 12,058 14,929 26,100 Software maintenance fees 14,284 11,090 22,994 21,757 Software implementation fees 4,508 5,695 9,402 12,892 Out-of-pocket expense reimbursements 816 1,670 2,139 3,858 -------- -------- --------- -------- Total revenues 36,161 43,459 64,417 87,148 Cost of revenues: Consulting fees 5,288 7,119 10,257 13,973 Software license fees 1,905 2,068 3,626 3,761 Software maintenance fees 3,070 2,475 6,186 5,244 Software implementation fees 5,027 4,691 9,850 9,829 Out-of-pocket expenses 1,038 1,939 2,291 4,276 -------- -------- --------- -------- Total cost of revenues 16,328 18,292 32,210 37,083 -------- --------- --------- -------- Gross profit 19,833 25,167 32,207 50,065 Operating costs and expenses: Selling, general and administrative 12,695 12,558 24,780 25,404 Research and development 1,716 3,175 3,522 6,161 Amortization of intangible assets 350 350 700 700 Restructuring and other charges 778 -- 1,462 -- -------- --------- --------- -------- Total operating costs and expenses 15,539 16,083 30,464 32,265 -------- --------- --------- -------- Income from operations 4,294 9,084 1,743 17,800 Other income (expense): Interest income 73 125 154 193 Interest expense (339) (696) (757) (1,481) Other income (expense) 36 (49) 50 38 --------- --------- --------- -------- Total other income (expense) (230) (620) (553) (1,250) --------- --------- --------- -------- Income before provision (benefit) for income taxes 4,064 8,464 1,190 16,550 Provision (benefit) for income taxes 133 547 226 (1,058) --------- --------- --------- -------- Net income $ 3,931 $ 7,917 $ 964 $17,608 ========= ========= ========= ======== Basic earnings per share $ 0.17 $ 0.34 $ 0.04 $ 0.77 ========= ========= ========= ======== Diluted earnings per share $ 0.17 $ 0.33 $ 0.04 $ 0.75 ========= ========= ========= ======== Shares used in computing basic earnings per share 23,547 23,397 23,547 22,850 ========= ========= ========= ======== Shares used in computing diluted earnings per share 23,723 24,005 23,631 23,351 ========= ========= ========= ======== CONTACT: Carreker Corporation, Dallas Frank Tilley, 972-371-1454 Fax: 972-458-2567 ftilley@carreker.com