THCG Announces Record First Quarter Results; Revenues Grow 5274.1% Over Prior Year's First Quarter
============================================================
NEW YORK--(BUSINESS WIRE)--May 11, 2000--
Earnings From Continuing Operations Reach $7,669,000 Compared to
a ($237,000) Loss in Prior Year's First Quarter
THCG, Inc. (NASDAQ:THCG) today reported revenues of $14,295,000
for the first quarter 2000 ended March 31, 2000. This represents a
5274.1% increase in quarterly revenues compared with last year's first
quarter. Venture service fee revenues increased 457.5% compared with
the first quarter of 1999, and reached $1,483,000 in this year's first
quarter. Appreciation in securities and interest income achieved a
record $12,812,000 for the first quarter 2000 compared with no
revenues related to this item in the comparable 1999 quarter.
Earnings from continuing operations for the first quarter was
$7,669,000 as compared to a loss of ($237,000) in the same quarter of
the previous year.
THCG's net income was $900,000 or $0.07 basic income per share for
the quarter, compared to a net loss of ($249,000) or ($0.07) basic
loss per share for the first quarter of 1999. Excluding the effects of
the amortization of intangible assets and stock-based compensation
charges in both periods, and the one-time $3,186,000 after-tax
write-offs related to the discontinuation of the factoring activities
in this first quarter, THCG's net income was $6,552,000 or $0.54 basic
income per share for the quarter, compared to a net loss of ($249,000)
or ($0.07) basic loss per share in last year's similar period.
First quarter 2000 results included the impact of pre-tax gains of
$12,256,000 related to Walnut Growth Partners, L.P. (a managed venture
capital fund) and THCG's economic interest in that fund, and a
$5,348,000 pre-tax write-off related to the discontinuation of the
factoring activities that were acquired by Walnut Financial Services
Inc. in 1998 (prior to the merger in November 1999 with Tower Hill
Securities, Inc.). First quarter 2000 operating expenses included the
effects of $1,532,000 of amortization of intangible assets and
$1,928,000 stock-based compensation charges. Excluding these items
expenses for continuing operations were $3,166,000, reflecting a
529.4% increase from the first quarter of 1999.
Joseph D. Mark, Co-CEO of THCG commented, "We are very excited
about the results of our first quarter. We have achieved these
financial milestones while continuing to successfully execute our
strategic plan. We expanded our management ranks with new executives,
added professionals to our Venture Development and Venture Banking
execution teams and partnered with eight new companies. THCG is well
positioned in this market environment to take advantage of interesting
opportunities where we can apply our V3 enterprise acceleration
business model - the seamless delivery of venture development, venture
banking, and venture funding services."
In the first quarter, THCG expanded its portfolio of partner
companies significantly to include:
SECTOR: ADVANCED TECHNOLOGY AND SERVICES
----------------------------------------
Globecom Interactive: provides full-featured broadband tools and
enterprise-wide broadband intelligent networking products and
services.
IT Utility: First ECSP (Enterprise Computing Service Provider).
Completely changes the business basis for buying information
technology services. Eliminates capital costs (hardware, software,
networking) by delivering all enterprise computing through a
thin-client Alternative Information Service Architecture (AISA(TM)),
billed on a per-seat monthly basis.
SECTOR: " CLICKS AND BRICKS" (BRICK & MORTAR COMPANIES IMPLEMENTING AN
INTERNET-BASED STRATEGY)
----------------------------------------------------------------------
Designer Jewelry On Line: The first segment-specific application
of a second-generation e-commerce model that unites manufacturers and
retailers in an online partnership, eliminating channel conflict.
GiftsWithLove: Online spiritual gift site delivered in partnership
with local churches and places of worship.
SECTOR: GLOBAL INTERNET- BASED BUSINESSES
-----------------------------------------
Al-Bawaba: The first comprehensive news, information, and
e-commerce portal to serve the 21 countries of the Middle East.
Convergence Mediagroup: Provides marketers who target the 12-21
year old segment with web experiences...immersive, branded online
media events. Provides research-based feedback to measure degree of
youth market involvement with brands that sponsor the experiences.
Global Credit Services: Online business intelligence and financial
information services for use in support of business decisions; also
publishes perspectives on financial factors that influence sector
economies.
Test U: Assist students in preparation for standardized tests by
providing the ultimate online environment for test preparation.
Adi Raviv, Co-CEO of THCG, added that, "During the quarter, THCG
further strengthened its financial position by $5.6 million through
the exercise of its Class A warrants issued in a private placement in
1997. In addition, we experienced a realization of a portion of our
holding in Interleaf, Inc. (acquired by BroadVision, Inc. in a stock
swap) and the initial public offering of webMethods, Inc. (NASDAQ:WEBM), the most significant holding of our managed venture capital
fund, Walnut Growth Partners, L.P. As an active Internet accelerator,
our mission is to build a meaningful equity position in dominant
companies that will achieve significant valuations. This approach
requires lead-time to implementation and fruition as our partner
companies continue to grow and develop. In the meantime, we expect to
further devote significant resources to the development of our
fee-for-service activities and realize the financial benefits from the
successes of our venture portfolio companies."
Since the quarter end, THCG announced that it had closed the
acquisition of certain businesses in Israel that had been operated
under the Giza Group ("Giza") name. Pursuant to the closing, THCG
formed THCG Giza Israel, the first building block in the THCG
international expansion plan. THCG Giza Israel will serve as the
global technology "center of excellence" and will focus on sourcing,
screening and developing promising companies in the areas of WAP,
Network Switching, Communications over IP, Fiber and CATV, and Next
Generation Search Engines.
About THCG
THCG is an active Internet accelerator providing V3 global
enterprise-enhancing services - a seamless integration of venture
development, venture banking and venture funding services on a global
basis. THCG's mission is to identify and build significant companies
by partnering with leading Internet entrepreneurs and traditional
brick and mortar companies migrating to the Internet. The THCG partner
company portfolio includes Convergence MediaGroup, Inc
(www.cmg-us.com), Designer Jewelry On Line, Global Credit Services,
Inc. (www.globalcreditservices.com), Globecom Interactive, Inc., IT
Utility, Inc. (www.itutility.com), and Test University, Inc. THCG also
has equity interests in more than 10 additional Internet-related
companies, including iBeauty.com (www.ibeauty.com), Broad Vision, Inc.
(NASDAQ:BVSN, www.broadvision.com), LogNet Systems Inc.
(www.lognet.co.il), Passport New Media, Inc. (www.yourownworld.com),
TechOnLine, Inc. (www.techonline.com), RealTimeImage Inc.
(www.realtimeimage.com), SoftWatch Ltd. (www.softwatch.com), SunShine
Media Corporation (www.bikini.com) and webMethods, Inc.
(www.webmethods.com). THCG's web site is located at www.thcg.com.
"SAFE HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION
REFORM ACT OF 1995: The statements contained in this release which are
not historical facts are forward-looking statements that are subject
to risks and uncertainties that could cause actual results to differ
materially from those set forth in or implied by forward-looking
statements. These risks and uncertainties include the Company's entry
into new commercial businesses, the risk of obtaining financing, risks
associated with start-up and early stage enterprises, risks associated
with providing services over the Internet, and other risks described
in the Company's Securities and Exchange Commission filings.
*T
THCG, Inc.
Consolidated Income Statement
For the 3 months ended March 31,
2000 1999
----------------------
Revenues
Venture service fees $1,483,000 $266,000
Appreciation in securities & interest income 12,812,000
----------------------
Total revenues 14,295,000 266,000
Expenses
Selling, general & administrative 3,166,000 503,000
Stock-based compensation 1,928,000
Amortization of acquired intangibles 1,532,000
----------------------
Total expenses 6,626,000 503,000
Income before discontinued operations & taxes 7,669,000 (237,000)
Provision for income taxes 3,583,000 12,000
----------------------
Net income before discontinued operations 4,086,000 (249,000)
Loss from discontinued operations net of taxes 3,186,000
----------------------
Net income (loss) $900,000 ($249,000)
======================
EPS before loss from
discontinued operations:
Basic $0.34 ($0.07)
Diluted $0.27 ($0.07)
EPS after loss from
discontinued operations:
Basic $0.07 ($0.07)
Diluted $0.06 ($0.07)
Diluted income per share calculations adjusted net income for the
dilutive effect of public company common stock equivalents.
*T
CONTACT: THCG, Inc.
Shai Novik
Chief Operating Officer
212-223-0440
snovik@thcg.com
www.thcg.com
or
Investor Relations:
Lippert/Heilshorn Assocs.
Lisa D. Lettieri
Vice President
212-838-3777 or lisa@lhai.com
www.lhai.com
or
Media Relations:
Lippert/Heilshorn Assocs.
Elissa Grabowski
Assistant Vice President
212-838-3777 or elissa@lhai.com
www.lhai.com
KEYWORD: NEW YORK
INDUSTRY KEYWORD: INTERNET BANKING EARNINGS
Today's News On The Net - Business Wire's full file on the Internet
with Hyperlinks to your home page.
URL: businesswire.com
Copyright 2000, Business Wire
================================================================ |
