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ECHO |
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The Company previously announced that the results of the first two quarters of fiscal 2000 would reflect the development costs associated with new check services, the integration costs associated with two acquisitions it made in the past year, Magic Software Development, Inc. and Rocky Mountain Retail Systems, Inc., and one-time costs associated with the initiation of a subsidiary bank application filed in December, 1999....
...``We decided to invest now and lay a solid foundation for the long-term growth of the Company by integrating the various services,'' stated Joel Barry, CEO of ECHO. ``In addition to the new services, we accelerated a complete rewrite and upgrade of Magic Software Development's electronic check settlement system. We knew it was necessary to get the new system completed and fully tested in anticipation of our growth based on the projected transaction volume from various sales channels. The previous system Magic operated would not be able to handle the projected load while the new system has been designed with scalability and flexibility in mind,'' said Barry....
...New services being developed or enhanced include 1) Internet-based check processing; 2) electronic and conventional check collection services with full Internet reporting capability; 3) check verification and check guarantee; and 4) check conversion at the point-of-sale....
...``The Company's new acquisition, Rocky Mountain Retail Systems (RMRS), located in Boulder, Colorado, will have a significant positive impact on ECHO's bottom line as they continue to grow their customer base,'' stated Barry. RMRS operated the National Check Information Services (NCIS) database, one of the few national shared negative check databases. In several tests by third parties, NCIS has provided superior results to those received from the other two national databases. RMRS' customers include Dollar General, Blockbuster, Wild Oats Natural Foods and other well-known national chain stores....
....The Company invested management's time and has incurred legal and filing expenses since December 1999, when it filed an application with the Office of the Controller of the Currency (OCC) and, in January 2000, with the Federal Deposit Insurance Corporation (FDIC) to start an Internet-based bank. This process is continuing and management expects approval in late May to early June from the OCC and FDIC. ``There can be no assurance that the applications will be approved by the OCC and the FDIC,'' said Jack Wilson, ECHO's Vice President and the designated President of the proposed bank, ``but I am encouraged by the progress to date and the support we have received from the OCC and FDIC. We expect the bank to be a major contributor to earnings in the years to come based upon the benefits derived from the sizable deposits a merchant program generates.''....
....Electronic Clearing House, Inc. provides credit card processing, cash advance services, check guarantee, check verification, check conversion, inventory tracking and/or various Internet services to over 41,000 retail merchants, U-Haul dealers and casinos across the nation. ECHO also designs, develops and integrates software and point-of-sale hardware that is utilized as credit card processing terminals, automated money order dispensers, inventory tracking devices, and casino cash advance systems.....
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