Trintech returns $52.5m loss in final quarter

Dublin-based e-payments group Trintech has reported a fourth-quarter pre-tax loss of $52.5 million (€60.7 million) and announced a management restructuring. Executive chairman Mr Cyril McGuire will take on the additional role of chief executive while his brother and co-founder of the company, Mr John McGuire, moves from chief executive to become president.

The poor final-quarter results were flagged last week when the shares dropped 26 cents on the Neuer Markt stock exchange. They were attributed to difficult markets and a fall in high margin licence revenue.

The shares showed some recovery yesterday closing nine cents ahead at €1.45, but well off their 52-week high of €4.10. The shares were helped by evidence of strong cost-cutting and guidance from the company that it expected to become cash positive by the end of the current year. The pre-tax loss for the 12 months to the end of January was just under $100 million.

The latest results include a $38 million charge for impairment of goodwill and assets purchased at the top of the market in late 2000; goodwill and asset amortisation of $8 million and a $1.6 million restructuring charge.

Trintech flagged an additional restructuring charge of $3.5 million in the current quarter "in response to continued challenging conditions". Pro forma results stripping out the non-cash impairment, goodwill and restructuring charges reduced the $52.5 million final-quarter loss to $2.7 million and to $16 million for the full year.

Asked about the future outlook, Mr McGuire described the environment as "challenging and uncertain". The company reduced costs by 22 per cent in the final quarter and would cut costs by a further 10 per cent in the current quarter, he said.

Results for the three months to end-January show a marginal fall in revenue to $15.51 million from $15.54 million year on year down 11 per cent in the third quarter and well off the $17 million to $19 million range predicted.

The poor fourth-quarter performance compares with a 39 per cent rise in revenue for the full year to $68.3 million.