LION Announces Fourth Quarter and Year End 2003 Results 59% Revenue
Growth Compared to Fourth Quarter 2002 SEATTLE, Feb. 26
/PRNewswire-FirstCall/ -- LION, Inc. (BULLETIN BOARD: LINN) , a
leading provider of advanced business solutions that streamline the
mortgage fulfillment process, today announced its financial results
for the fourth quarter and the year ended December 31, 2003.
Revenue for fourth quarter 2003 increased 59% to $2,646,692, up
from $1,664,054 for fourth quarter 2002. For the full year 2003,
revenue increased 27% to $8,134,088 from $6,409,568 in the prior
year. The December 2003 acquisition of the assets of Ignition
Mortgage Technology Solutions, Inc. ("Ignition") contributed
$728,750 to fourth quarter and full year 2003 revenue. Net income
for fourth quarter 2003 was $2,467,128 or $.08 per share, compared
to $141,182 for the same quarter in the prior year. Net income for
full year 2003 increased to $2,868,964, or $.09 per share, compared
to a loss of $109,087 for 2002. 2003 net income included an
extraordinary gain net of tax related to the Ignition asset
purchase of $2,063,031. Excluding the extraordinary gain, the
Company reported net income of $404,097 for the fourth quarter, or
$.013 per share, and $805,933, or $.025 per share for 2003. In
2002, the loss of $109,087 included approximately $647,000 in
settlement charges and legal fees related to litigation settled in
July 2002. "I am very pleased with the Company's fourth quarter and
twelve month 2003 performance and with the early indicators of how
the Company will perform in 2004," states Randall D. Miles,
Chairman and CEO of LION, Inc. "The Company continues to build a
strong enterprise generating increasing revenue and profits. Solid
performance combined with the recent strategic acquisition of
Ignition assets and its customer base positions the Company to
double revenue in 2004." "The Ignition transaction was an asset
purchase structured on favorable terms that included a significant
paring of Ignition's expense components that included personnel
reduction and lowered infrastructure costs while gaining valuable
assets that included intellectual property, hardware, accounts
receivable and customer relationships. The Company's operational
focus in the first half of 2004 is expected to be directed towards
integrating technology and products. Progress to date is tracking
to plan and the transaction will be accretive to earnings in 2004."
2003 Highlights -- Strategic acquisition of Ignition Mortgage
Technology Solutions assets from Freddie Mac -- Achieved 34% growth
in Mortgage 101 product revenue in 2003 and 25% growth in the
fourth quarter over the same quarter a year ago -- Conversion to
pay-per-lead business model in Mortgage 101 and migration to
Microsoft.Net technology platform -- 23% increase in fourth quarter
Retail Website sales compared to fourth quarter 2002 -- Adoption of
LION Pro by 12 new corporate customers in the fourth quarter 2003
-- Increase in share price from $.05 at 12/31/02 to $.25 at
12/31/03 or 400% "Integrating the essence of two companies, merging
two complimentary product lines into one seamless mortgage platform
and addressing the expectation that mortgage origination will fall
off dramatically from historical highs of the last two years
represent challenges for which we believe we have developed
effective strategies," concluded Miles. For more details about the
acquisition, product integration, and the Company's future plans,
see the Chairman's Letter located at LION's corporate website at
http://www.lioncorp.net/lioncorp/president. About LION, Inc. LION,
Inc. is a leading provider of advanced business solutions that
streamline the mortgage loan fulfillmentprocess in the over $2
trillion mortgage industry. From Leads to Loans to Capital Markets,
LION Inc. offers consistent, seamless business solutions to
consumers, brokers, realtors, originators and lenders. LION, Inc.
and its mortgage technology division, Ignition Mortgage Technology
Solutions, provide an integrated technology platform offering
online loan productivity, mortgage pipeline hedging and risk
management, software development and data communications tools.
LION / Ignition have offices in Washington, California and
Colorado. For more information, please visit
http://www.lioninc.com/. This press release contains
forward-looking statements that involve risks and uncertainties
concerning our expected performance (as described without
limitation in the quotations from current management in this
release). Actual results may differ materially from the results
predicted and reported results should not be considered as an
indication of our future performance. We believe that these
potentialrisks and uncertainties include, without limitation: our
substantial dependence on mortgage brokers and the mortgage broker
industry; mortgage market trends; interest rate changes; housing
and consumer trends effecting home purchases; the management ofour
potential growth; risks of new business areas and new Internet
technology; joint- marketing and sales agreements; our need for
additional financing; our ability to attract and retain high
quality employees; changes in the overall economy and in
technology; and the number and size of our Internet competitors.
Statements in this release should be evaluated in light of these
important factors. All information set forth in this release is as
of February 26, 2004, and LION undertakes no duty to update this
information. More information about these and other important
factors that could affect our business and financial results is
included in our Annual Report on Form 10-KSB for the fiscal year
ended December 31, 2002, including (without limitation) under the
captions, "Risk Factors" and "Management's Discussion and Analysis
of Financial Condition and Results of Operations", which is on file
with the Securities and Exchange Commission. Additional information
may also be set forth in those sections in our quarterly reports on
Form 10-QSB previously filed with the Securities and Exchange
Commission. LION, Inc. CONDENSED STATEMENTS OF OPERATIONS
(Unaudited) Three months ended For the Year Ended December 31,
December 31, 2003 2002 2003 2002 Revenues $2,646,692 $1,664,054
$8,134,088 $6,409,568 Expenses Direct costs 680,794 330,298
1,735,428 1,079,660 Selling and marketing 515,654 473,881 2,240,197
1,843,857 General and administrative 735,336 535,794 2,443,140
2,413,824 Research and development 147,939 79,389 383,903 317,909
Depreciation and amortization 132,274 101,245 482,947 464,573
2,211,997 1,520,607 7,285,615 6,119,823 Operating income 434,695
143,447 848,473 289,745 Other expense -- net (5,175) (2,265)
(17,117) (398,832) Net income (loss) before tax and extraordinary
item 429,520 141,182 831,356 (109,087) Income tax expense 25,423 --
25,423 -- Net income (loss) before extraordinary gain 404,097
141,182 805,933 (109,087) Extraordinary gain -- net of tax
2,063,031 -- 2,063,031 -- NET INCOME $2,467,128 $141,182 $2,868,964
$(109,087) Net income (loss) per common share, Basic $.08 $-- $.09
$-- Diluted $.07 $-- $.09 $-- LION, Inc. CONDENSED BALANCE SHEETS
December 31, ASSETS 2003 2002 CURRENT ASSETS Cash and cash
equivalents $2,883,314 $403,917 Accounts receivable -- net
2,141,264 347,661 Other receivables 620,708 -- Prepaid expenses and
other 361,975 71,388 Total current assets 6,007,261 822,966
PROPERTY AND EQUIPMENT, net 1,025,153 940,372 OTHER ASSETS Goodwill
-- net 273,955 273,955 Other assets 82,908 37,908 $7,389,277
$2,075,201 LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES
Accounts payable $189,727 $111,340 Accrued liabilities 1,599,754
329,671 Current maturities of long-term obligations 82,452 35,330
Deferred revenue 1,240,166 295,497 Total current liabilities
3,112,099 771,838 LONG-TERM OBLIGATIONS, less current maturities
85,822 52,495 STOCKHOLDERS' EQUITY 4,191,356 1,250,868 $7,389,277
$2,075,201 DATASOURCE: LION, Inc. CONTACT: Dave Stedman, President
of LION, Inc., +1-800-546-6463 Web site: http://www.lioninc.com/
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