My first cut on the call:
CKFR serves "vast majority" of 2mm billpayers on line today. Electronic payment adoption is happening, no longer a question about this. They have Ks signed with banks representing 150mm accounts. Forty-five percent of payments remitted electronically out of Columbus today, 10 percent out of old ISC in Chicago, up from 2 percent on purchase date. MSFT is coming as a competitor in payment processing via FDC alliance, but (according to Kight) banks do not trust MSFT because MSFT wants to capture (and use) too much information about the payment stream, information which the banks and their customers consider proprietary. Projections for FY98 include $232MM in revenue, 57 percent from Electronic Commerce segment, 30 percent from Software, and 13 percent from Investment Svcs. Target is 52% electronic remitted corporate wide by FY end 1998. Subscriber trend growth continues > expected, with Nationsbank having to pull back on marketing electronic banking/bill pay recently due to bottlenecks and too rapid response. Chase and Wells Fargo both also moving ahead aggressively with rollouts. CKFR estimates growth from 1.8mm subs today to 2.75mm by FY end 98, but this includes only banks ALREADY SIGNED TODAY, so, as usual, it seems conservative. RE bill presentment, CKFR owns the (very limited) market, with relationships with 16 of the top 100 merchants nationwide. CYCH is barely registering is this space, according to Kight. Oracle will be a player here in the future because so many large billing systems are done with their software. Intuit relationship is key also because so many hard pressed smaller businesses use Quickbooks. Quickbooks front end should provide the same entree to small business market for electronic commerce that Quicken provided for retail. All in all, co. remains on plan (a quite detailed, specific plan, I might add) with a clear vision of where they want to be and who the players are. I'll have more comments about the financials later.
Regards. |
