Frankfurt am Main, Germany, July 26, 2001, (PRIMEZONE) -- i:FAO Aktiengesellschaft (GER:FAO2)(WKN 622 452), market leader for business travel eProcurement software for the booking and management of corporate travel today releases financial results for the first six months, from January 1, until June 30, 2001.
In the technology segment, the revenues increased significantly by 66,7% to EURO 1,359,841 (in comparison to the same period in the prior year). Because of the spin off of the high revenue divisions eHotel, cabana and Travel Service other figures of the year 2000 are not directly comparable.
With the sale of the total holding of Galileo International Shares, which have been acquired during the sale of the investment in Trip.com, i:FAO has secured its liquidity reserves. This transaction positively influenced the financial result. The company is very well positioned for the future, with substantial liquidity reserves in the amount of EURO 25,974,035
In terms of cautious accounting principles, i:FAO has reduced the investment book value of the minority investment in i-tinerary Travel Solutions, Inc., Scottsdale, Arizona in the amount of EURO 1,360,361. The reason for this write-off is i:FAO's incomplete agreement with the present business strategy of i-tinerary, which plans to migrate from an Internet travel agency to become a software developer. Furthermore, i:FAO Aktiengesellschaft has, because of the filing of insolvency by T.I.S.S. AG, written off the loan given to that company of EURO 1,000,000. Additionally i:FAO has written off all remaining interest debt of this loan and claims resulting from the operating business. Although negotiations about solution concepts are still ongoing in both cases, future risks for the i:FAO Group are already limited.
Despite of the write-offs the i:FAO group is able to report earnings after taxes (EAT) in the amount of EURO 82,346, which results in earnings per share of EURO 0.01.
For the i:FAO Aktiengesellschaft the financial result have a more significant effect. Earnings after taxes (EAT) in the amount of EURO 3,499,337 have been booked. The lower profit within the i:FAO Group is due to the results of the foreign subsidiaries, specifically i:FAO of North America, Inc., which is still in a start up mode. The US revenue, which came in below plan and the, compared to Europe higher operating expenses, have burdened the Group results.
i:FAO Aktiengesellschaft reacts to this situation by introducing cost reducing measures. Similarly the recently completed acquisition of the powertrip business of X-tra Online Corporations, Dallas, Texas will make the market penetration in the USA easier and will result in increased U.S. revenues in the next quarters.
The operating result (EBIT) of the i:FAO Group amounts to EURO -5,635,160 and is turned into positive earnings after taxes (EAT) due to the strong financial results. The EBIT was mainly burdened by the already mentioned write offs as well as legal and consulting fees and one time transaction cost in conjunction with the sale of shares.
The continued expansion of the i:FAO flagship product Cytric with more than 759 customers (+ 178% in comparison to the same period in the prior year) will be leading to continually increased revenues in the coming quarters.
Independent from the positive forecast i:FAO started a program to reduce operational cost. Besides the cost reductions and the activities to increase the revenues, i:FAO uses the substantial liquidity situation to buy back own shares, as decided very recently. With the shares buy back program i:FAO underlines its efforts to actively increase the shareholder value and hopes to signal to the market, that the current share price does not reflect the fair value of the enterprise.
Important key figures of the i:FAO Group: (all figures in EURO according to IAS, for the period from January 01, until June 30, 2001)
Revenues: 1,610,691 Total Performance: 2,689,323 EBIT: (-5,635,160) EAT: 82,346 Cash Flow, operative: 713,737 Earnings per Share: 0.01 Cytric customers: 759 Number of associates: 141.
The full text version of this report can be found at the following link: http://reports.huginonline.com/828310/92001.pdf