April 30, 1997
Affinity Announces First-Quarter Results
Steady Progress Continues in Multiple-Product, Multiple-Channel Strategy
With Dime Agreement, Mortgage Launch, Insurance Acquisition
COLUMBIA, S.C., April 30 /PRNewswire/ -- Affinity Technology Group (Nasdaq: AFFI),
which went public on April 26, 1996, today announced financial results for the first quarter ended
March 31, 1997.
Revenues for the quarter were $661 thousand, with a net loss of $3.4 million, or $0.12 per share.
For the comparable period in 1996, revenues were $1.9 million and the Company reported a net
loss of $218 thousand, or $0.01 per share. The weighted average number of shares outstanding
during the three months ended March 31, 1997 was 28.1 million, compared to 16.7 million for the
same period in 1996.
Jeff A. Norris, Chief Executive Officer and President of Affinity, stated, "During the first quarter,
Affinity realized a series of significant steps forward in implementing our multiple-product,
multiple-channel strategy in a range of markets. That strategy is exemplified by our recently
announced agreement with The Dime Savings Bank of New York, FSB, which involves the
integration of our real-time closed loop remote banking technology across Dime's consumer loan
product line in all its branches, call centers, risk management group and remote closing sites."
Norris continued, "In addition, we continue to make progress toward introducing new,
value-added products based on our core technology. These include the upcoming beta launch of
our mortgage product, and our recent acquisition of Buy American, which will position us to offer
insurance products that we believe will be of particular interest to our core financial institution
customers, as well as insurance companies that wish to expand their operations."
Dime Agreement Demonstrates Technology's Revenue-Generating Potential
Affinity recently announced that it will integrate its technology into the Dime's existing software in all
its distribution channels, providing nationwide support for decisioning and fulfillment in products
including home equity, auto loans, and unsecured installment loans and lines of credit. The
technology also has the capability to automatically provide representatives cross-selling
opportunities based on customers' profiles. The company also indicated that it was working on
proposals with new and existing customers to implement comprehensive processing, decisioning
and integration services that enhance Automated Loan Machine (ALM(R)) programs and help
integrate and provide consistency among delivery channels.
Said Norris, "As Affinity executes the breakthrough Dime agreement, we will model the full
potential of our real-time closed loop technology to other likely 'early adopters' we are targeting
among the nation's leading financial institutions. Our goal is to demonstrate that our technology
allows customers to leverage the investments they have made in call centers, ATMs, branches, and
other delivery channels by generating additional revenues from these assets.
"We look forward to identifying and realizing more such opportunities in the future, both through
our sales force and through the qualified leads being provided by our Strategic Partners. We are
optimistic about the potential for ALM orders from new and existing customers."
Norris noted that the Dime agreement is also significant in that it provides revenues from consulting
services as well as hardware. "Through our consulting services, Affinity's customers have direct
access to a highly skilled team of professionals who can advise them about critical decisions in
credit evaluation, loan scoring, retail strategy, marketing, and more."
Agreements Advance Mortgage, Insurance Products
Affinity also reached agreements with two institutions to participate in testing and beta programs of
the Affinity Automated Mortgage Loan. Affinity's state-of-the-art mortgage product is designed to
reduce the time and cost of mortgage loan origination for lenders and consumers by automating the
entire process. Affinity will make this product available to the beta sites through its Automated
Loan Machines (ALM) in the second quarter of 1997.
Affinity had also previously announced a definitive agreement to acquire the assets of Buy
American, Inc. and Project Freedom, Inc., two closely held Dallas-based firms that have
developed a consumer-driven kiosk that automates the process of applying for and receiving
insurance binders. Affinity will create a new insurance division, Affinity Insurance (AI), to operate
the business, and Mr. Norris reiterated Affinity's expectation of putting the first kiosks into the field
during 1997.
Affinity's proprietary Decisys/RT(SM) technology is a real-time, closed loop decision support
system designed to bridge the gap between financial institutions and consumers by automating the
processing and closing of credit, deposit and other financial transactions through any retail delivery
channel -- branches, call centers, kiosks, ATMs, home banking, the Internet, retail dealers, the
Affinity Automated Loan Machine (ALM), and beyond. The flexibility of Decisys/RT can empower
consumers to conduct financial transactions anytime and anywhere they like, while enabling financial
institutions to realize greater market share and assets by selling, servicing and fulfilling consumers'
needs precisely when and where they are ready to buy.
The Affinity ALM delivers revenue generating branch services, without the brick-and-mortar
investment, and can be deployed in any location. It also serves as a powerful and immediate
fulfillment vehicle for transactions initiated through other retail delivery channels. Affinity is located
on the World Wide Web at www.affi.net.
Statements in this news release looking forward in time are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that
forward-looking statements involve risks and uncertainties, including general economic conditions,
delays and risks associated with the development of new technologies, consumer and industry
acceptance of automated delivery channels and regulatory risks.
Affinity Technology Group, Inc.
First Quarter 1997
Income Statement
Three Months
Ended March 31,
1997 1996
Revenues
Initial set-up, transaction
and other $533,584 $258,653
Sales & rental 127,700 388,743
License revenue -- 1,237,500
Total revenues 661,284 1,884,896
Costs & Expenses
Cost of revenues 291,215 728,211
Research & Development 843,127 387,437
Selling, general &
administrative 3,537,269 1,003,103
Total costs and expense 4,671,611 2,118,751
Operating loss (4,010,327) (233,855)
Interest income (expense) 606,667 15,673
Net loss $(3,403,660) $(218,182)
Net loss per share $(0.12) $(0.01)
Shares used in computing
net loss per share 28,064,447 16,695,318
Balance Sheet March 31,
1997 1996
Cash and Short Term
Investments $37,591,981 $450,000
Total Current Assets 42,400,091 2,063,576
Total Assets 51,924,214 5,742,117
Total Liabilities 2,918,888 5,136,729
Stockholders Equity 49,005,326 605,388
/CONTACT: Joe Boyle, Chief Financial Officer of Affinity Technology Group, 803-758-2750/ |
