ICC Announces First Quarter Fiscal 2004 Financial Results NEW YORK,
Dec. 11 /PRNewswire-FirstCall/ -- Internet Commerce Corporation
("ICC" or the "Company") , a leader in the e-commerce
business-to-business communication services market, today announced
financial results for its fiscal first quarter ended October 31,
2003. (Logo: http://www.newscom.com/cgi-bin/prnh/20030611/ICCALOGO
) G. Michael Cassidy, President and Chief Executive Officer of ICC,
commented, "We are pleased that during the first quarter of fiscal
2004, our core VAN services revenue grew 20.9% compared to the
first quarter in the year-ago period. Our operational leverage will
improve as our network products and services grow and drive our
bottom line results in the remainder of fiscal 2004." Consolidated
Three-Month Results -- Consolidated revenue for the first quarter
of fiscal 2004 remained relatively flat at $3.1 million. -- Gross
margin for the first quarter of fiscal 2004 improved to 40.1% from
38.4% for the first quarter in the year-ago period. -- The Company
narrowed its net loss to $818,000, or $0.07 per diluted share in
the first quarter of fiscal 2004, from a net loss of $982,000, or
$0.09 per diluted share, last year. Consolidated Three-Month
Results - Earnings before interest, taxes, depreciation,
amortization, impairment and non-cash charges (Adjusted EBITDA).
Adjusted Gross Margin represents gross margin less depreciation and
amortization. Refer to Supplemental Financial Data below for a
reconciliation of Net Income to Adjusted EBITDA and Gross Margin to
Adjusted Gross Margin. -- Adjusted EBITDA for the first quarter of
fiscal 2004 improved 29.8% to a loss of $367,000 from a loss of
$523,000 in the year-ago period. On a sequential basis, the
adjusted EBITDA has been reduced from a loss of $873,000 in the
second quarter of fiscal 2003 to $475,000 in the third quarter of
fiscal 2003, $604,000 in the fourth quarter of fiscal 2003 and
$367,000 in the first fiscal quarter of 2004. -- Adjusted gross
margin for the first quarter of fiscal 2004 improved to 49.6% from
46.4% for the first quarter in the year-ago period. Walter M.
Psztur, Chief Financial Officer of ICC, commented, "On a sequential
basis we reduced our Adjusted EBITDA from a loss of $604,000 in the
fourth quarter of fiscal 2003 to a loss of $367,000 in the first
quarter of fiscal 2004 or 39.2%. The Adjusted EBITDA loss of
approximately $125,000 per month in the first quarter of fiscal
2004 includes an increase in Selling and Marketing expenditures of
14% or approximately $100,000 from the fourth quarter of fiscal
2003." Segment Results - First Quarter Fiscal 2004 ICC.NET: For the
first quarter of fiscal 2004, ICC.NET revenue, which includes VAN
and Mapping Services, represented 79% of consolidated revenue
compared to 69% of consolidated revenue in the year-ago period. Mr.
Psztur continued, "For the first fiscal quarter 2004, our core VAN
services had average Adjusted EBITDA loss of approximately $51,000
per month. This means that a large portion of any increase in
revenue should fall directly to our bottom line as we will be able
to capitalize on our recurring revenue stream and operational
leverage." -- Adjusted gross margin for VAN Services for the first
quarter of fiscal 2004 improved to 62.9 % from 53.3% for the first
quarter in the year ago period. First Fourth Third Second First
Quarter Quarter Quarter Quarter Quarter Fiscal Fiscal Fiscal Fiscal
Fiscal (000's) 2004 2003 2003 2003 2003 ICC.NET Revenue $2,441
$2,406 $2,298 $2,044 $2,119 Core Van Services Revenue $2,356 $2,257
$2,205 $1,886 $1,949 Mapping Revenue $85 $150 $93 $158 $170 Service
Bureau For the first quarter of fiscal 2004, Service Bureau revenue
represented 10 % of consolidated revenue compared to 15 % of total
revenue in the year-ago period. First Fourth Third Second First
Quarter Quarter Quarter Quarter Quarter Fiscal Fiscal Fiscal Fiscal
Fiscal (000's) 2004 2003 2003 2003 2003 Revenue $308 $291 $341 $390
$466 Professional Services For the first quarter of fiscal 2004,
Professional Services revenue represented 11 % of consolidated
revenue compared to 15 % of total revenue in the year-ago period.
First Fourth Third Second First Quarter Quarter Quarter Quarter
Quarter Fiscal Fiscal Fiscal Fiscal Fiscal (000's) 2004 2003 2003
2003 2003 Revenue $355 $404 $456 $404 $465 The Company will post
its investor presentation and supplemental financial information on
its website, http://www.icc.net/, in the afternoon of December 11,
2003, the date of its quarterly webcast. About Internet Commerce
Corporation Internet Commerce Corporation (NASDAQ:ICCA) is a leader
in the e-commerce business-to-business communication services
market. ICC.NET, the company's global Internet-based value added
network, provides complete supply chain connectivity solutions for
EDI/EC while also offering users a sophisticated vehicle to
securely transact files of any format and size. ICC offers a broad
range of consulting services including, XML technologies, data
transformation, custom application development, an EDI service
bureau, as well as comprehensive e-commerce education. ICC uniquely
bridges the legacy investments of yesterday to today's Internet
technologies. For further information, visit us at
http://www.icc.net/. Except for the historical information
contained herein, this press release includes forward looking
statements which are subject to a number of risks and
uncertainties, including the risks and uncertainties associated
with rapidly changing technologies such as the Internet, the risks
of technology development and the risks of competition. Actual
results could differ materially. For more information about these
risks and uncertainties, see the SEC filings of Internet Commerce
Corporation. INTERNET COMMERCE CORPORATION Consolidated Statements
of Operations and Comprehensive Loss (unaudited) (in thousands,
except for share and per share amounts) Three Months Ended October
31, 2003 2002 Revenues: Services $3,103 $3,050 Expenses: Cost of
services 1,860 1,879 Product development and enhancement 225 260
Selling and marketing 826 764 General and administrative (excluding
non-cash compensation of $53 for the three months ended October 31,
2003) 945 1,110 Non-cash charges for stock-based compensation and
services 53 - 3,909 4,013 Operating loss (806) (963) Other income
and (expense): Interest and investment income 1 5 Investment gain
(loss) - (19) Interest expense (13) (5) (12) (19) Net loss $(818)
$(982) Dividends on preferred stock (100) (100) Loss attributable
to common stockholders $(918) $(1,082) Basic and diluted loss per
common share $(0.07) $(0.09) Weighted average number of common
shares outstanding - basic and diluted 13,797,567 11,679,964
COMPREHENSIVE LOSS: Net loss $(818) $(982) Other comprehensive
loss: Unrealized gain - marketable securities 9 13 Comprehensive
loss $(809) $(969) INTERNET COMMERCE CORPORATION Consolidated
Balance Sheets (unaudited) (in thousands) October 31, July 31, 2003
2003 ASSETS Current assets: Cash and cash equivalents $1,097 $2,283
Marketable securities 101 92 Accounts receivable, net of allowance
for doubtful accounts of $236 and $220, respectively 1,931 1,733
Prepaid expenses and other current assets 248 296 Total current
assets 3,377 4,404 Restricted cash 129 128 Property and equipment,
net 476 557 Software development costs, net 108 128 Goodwill 1,212
1,212 Other intangible assets, net 1,912 2,151 Other assets 15 18
Total assets $7,229 $8,598 LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities: Accounts payable $654 $919 Accrued expenses
970 1,179 Accrued dividends - preferred stock 332 232 Deferred
revenue 70 97 Capital lease obligation 136 148 Other liabilities 99
129 Total current liabilities 2,261 2,704 Capital lease obligation
- less current portion 22 46 Other non-current liabilities - 8
Total liabilities 2,283 2,758 Commitments and contingencies
Stockholders' Equity: Preferred stock * * Common stock 138 138
Additional paid-in capital 87,404 87,489 Accumulated deficit
(82,631) (81,813) Accumulated other comprehensive income (loss) 35
26 Total stockholders' equity 4,946 5,840 Total liabilities and
stockholders' equity $7,229 $8,598 * less than 1,000 INTERNET
COMMERCE CORPORATION Supplementary Financial Data Reconciliation of
Net Income to Adjusted EBITDA - Consolidated (000's) First Fourth
Third Second First Quarter Quarter Quarter Quarter Quarter Fiscal
Fiscal Fiscal Fiscal Fiscal 2004 2003 2003 2003 2003 Net loss
($818) ($2,062) ($1,074) ($1,887) ($981) Less: Net interest and
investment income 12 14 6 6 18 Depreciation and amortization 386
390 387 432 440 Non-cash charges for stock-based compensation 53 57
72 10 - Impairment of software inventory - - - 248 - Impairment of
capitalized software - 15 134 - - Impairment of goodwill and
acquired intangibles - 982 - - - Impairment of marketable
securities - - - 318 - Adjusted EBITDA loss ($367) ($604) ($475)
($873) ($523) Reconciliation of Net Income to Adjusted EBITDA -
ICC.NET, VAN Services Only First Quarter (000's) Fiscal 2004 Net
loss ($315) Less: Net interest 9 Depreciation and amortization 99
Non-cash charges for stock-based compensation 53 Adjusted EBITDA
loss ($154) Reconciliation of Gross Margin to Adjusted Gross Margin
- ICC.NET, VAN Services Only First Quarter First Quarter (000's)
Fiscal 2004 Fiscal 2003 Revenue $2,356 $1,949 Cost of services 907
915 Gross margin 1,449 1,034 Gross margin % 61.5% 53.0% Cost of
services $907 $915 Less: Depreciation (32) (5) Adjusted cost of
services $875 $910 Adjusted gross margin $1,481 $1,039 Adjusted
gross margin % 62.9% 53.3% INTERNET COMMERCE CORPORATION
Supplementary Financial Data Reconciliation of Gross Margin to
Adjusted Gross Margin - Consolidated First Quarter First Quarter
(000's) Fiscal 2004 Fiscal 2003 Revenue $3,104 $3,050 Cost of
services 1,861 1,878 Gross margin 1,243 1,172 Gross margin % 40.1%
38.3% Cost of services $1,861 $1,878 Less: Depreciation and
amortization (298) (244) Adjusted cost of services 1,563 1,634
Adjusted gross margin $1,541 $1,416 Adjusted gross margin % 49.6%
46.4%
http://www.newscom.com/cgi-bin/prnh/20030611/ICCALOGODATASOURCE:
Internet Commerce Corporation CONTACT: Victor Bjorge of Internet
Commerce Corporation, +1-212-271-7618, Web site:
http://www.icc.net/
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