A number of publicly traded financial technology firms released higher quarterly earnings reports last week, in some cases slightly exceeding analysts' forecasts.
Technology firms in the transaction processing business seemed to have done particularly well in the latest quarter, ended Dec. 31. For example, Redwood City, Calif.-based Verifone Inc. said its fourth-quarter net income increased 13.9% to $9.2 million, or 37 cents per share, from the year- earlier period.
The company said excluding fourth-quarter charges related to two acquisitions completed in 1995, the company earned 43 cents per share. Wall Street analysts had expected the company to earn 38 cents per share, according to First Call Corp.
Net revenues including the acquisitions rose 25.8% from the fourth quarter 1994, to $109.3 million.
Net revenues for the year were $387 million, up 22.4% from 1994. Profits for all of 1995 increased by 15.6%, to $32.5 million, or $1.32 per share.
"We are very pleased with our performance in 1995," said Hatim A. Tyabji, Verifone's chairman, president, and chief executive officer. "Our business mix continued to produce strong and balanced results, providing a stable foundation for expansion into electronic commerce, consumer services, and other emerging market opportunities.
"1995 marked the addition of two new and highly complementary businesses to the Verifone family, Enterprise Integration Technologies and Timecorp, both of which underscore the company's evolution from a hardware manufacturer to a software and total system solutions provider," Mr. Tyabji added.
Another player in the field of electronic payment systems, Transaction Systems Architects Inc. reported a 32% increase in revenues from for its first fiscal quarter of 1996.
The Omaha-based developer of electronic funds transfer software said it reported net income of $2.9 million, or 22 cents per share, compared with a net loss of $1.4 million in the corresponding quarter in 1994. Excluding $838,000 in acquisition-related charges booked in the quarter, the company earned $3.4 million, or 26 cents per share. Analysts were predicting the company would earn 24 cents share in the latest three-month period, according to First Call.
Bank software and systems outsourcing firm Fiserv Inc. reported its fourth quarter revenues rose 25%, to $195.8 million.
Excluding a $173 million one-time charge for its acquisition of Information Technology Inc. last year, Milwaukee-based Fiserv said it earned $13.4 million, or 29 cents per share, a 16% rise from the year- earlier period. Analysts expected the company to earn 30 cents per share in the last three months of last year, according to First Call.
For all of 1995, Fiserv earned $49.8 million before the acqusition charge, on revenues of $703.4 million.
Alltel Corp., another major player in the bank systems outsourcing business, said its fourth-quarter net income totaled $92.6 million, or 48 cents per share, up from $44 million, or 23 cents per share, in the corresponding period in 1994. Analysts were expecting the Little Rock-based to earn 46 cents per share in the latest quarter.
Alltel's information services subsidiary, formerly known as Systematics, reported operating income of $41 million in the fourth quarter, a 25% increase over the year-earlier period, although full-year operating profit grew by only 2%.
"Results from information services continued to reflect the effects of consolidation within the domestic banking market," said Joe Ford, Alltel's chairman and chief executive. "However, information services' performance strengthened later in the year, assisted by stronger software sales."
Another purveyor of core accounting software to banks, Hogan Systems Inc. day reported net income for its third quarter fiscal 1996 reached $664,000 or 4 cents per share, compared with $307,000, or 2 cents per share, for the year-earlier period.
Revenue for the three months ended Dec. 31 rose nearly 14% to $23.1 million compared with the same period last year.
"Our license fees at $8.9 million are up 30% over last year, services revenue is up 15% at $51.3 million for the nine months and we have nearly tripled our (nine-month) earnings to $4.8 million," said Michael H. Anderson, chairman and chief executive of Dallas-based Hogan. "We are satisfied with these results and how we are positioned for our final quarter."
Hogan in December announced an agreement to merge with Continuum Co. of Austin, Tex. The transaction is still subject to shareholder approval by both companies.