US Dataworks Reports Fiscal 2005 Third Quarter Results; 24%
Increase in 3rd Quarter Revenues Over Prior Year HOUSTON, Feb. 3
/PRNewswire-FirstCall/ -- US Dataworks (AMEX:UDW), a leading
developer of payment processing solutions, today announced
financial results for its fiscal 2005 third quarter ended December
31, 2004. Revenues for the fiscal 2005 third quarter were $518,000
compared with revenues of $416,000 for the same period a year ago.
Operating loss for the quarter was $1,386,000 compared to an
operating loss of $982,000 for the quarter ended December 31, 2003.
Net loss for the third quarter was $1,320,000, or $0.05 per share,
compared to a net loss of $1,243,000 or $0.05 per share, for the
corresponding period in the prior year. "Due primarily to seasonal
factors, our recurring 'click' revenues from customers that pay by
the transaction during the third quarter were basically flat with
our second quarter. We have over one billion transactions under
management available and processed approximately 537 million actual
transactions between January 1, 2004 and December 31, 2004," stated
Charles E. Ramey, CEO of US Dataworks. "We continue to be very
excited about our growth opportunities over the next several years
as the electronification(SM) of payment processing increases
rapidly. "Our solutions are leading the industry. National
Automated Clearing House (NACHA) recently announced that industry
volume in 2004 grew over five times the 2003 volume with an
industry administrative return rate of 1.04%. Our volume was
approximately 57% of the industry total with an administrative
return rate of 0.1%, a significant performance difference. "While
we are pleased with solid year-over-year revenue growth, we have
witnessed slower than expected implementation of Check 21 solutions
since it became law in late October 2004. As we have previously
stated, we are in the infancy of a rapidly increasing market and
believe that our 'per transaction' results, strategic marketing
relationships and strategic alliances will continue to grow. We
believe our investment in our R&D, direct sales force and
marketing efforts will drive recurring sales over the long term
thereby benefiting our customers as well as our shareholders,"
concluded Ramey. CONFERENCE CALL US Dataworks has scheduled a
conference call for Thursday, February 3, 2005 at 5:00 p.m. eastern
time. To participate in the conference call, dial 303-262-2075 at
least ten minutes before the call begins and ask for the US
Dataworks conference call. A replay of the call will be available
approximately two hours after the live broadcast ends and will be
accessible until February 10, 2005. To access the replay, dial
(303) 590-3000 using a pass code of 11022273. Investors, analysts
and the general public will also have the opportunity to listen to
the conference call over the Internet by visiting
http://www.usdataworks.com/ . To listen to the live call on the
web, please visit the company's web site at least fifteen minutes
before the call begins to register, download and install any
necessary audio software. For those who cannot listen to the live
web cast, an archive will be available shortly after the call.
ABOUT US DATAWORKS US Dataworks is a developer of payment
processing solutions, focused on the Financial Services market,
Federal, State and local governments, billers and retailers.
Software developed by US Dataworks is designed to enable
organizations to transition from traditional paper-based payment
and billing processes to electronic solutions that automate
end-to-end processes for accepting and clearing checks. Except for
the historical information contained herein, the matters set forth
in this press release, including, but not limited the extent to
which the Company's balance sheet has been strengthened, leadership
in the ARC market has been captured and efforts toward
profitability have been continued and the increasing of our efforts
toward capturing further market share in ARC, Check-21 and other
electronic payment processing solutions are forward- looking
statements within the meaning of the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995. These
forward-looking statements are subject to risks and uncertainties
that may cause actual results to differ materially, including, but
not limited to, the Company's position in the marketplace, our
ability to develop and timely introduce products that address
market demand, the impact of alternative technological advances and
competitive products, market fluctuations, our ability to obtain
future financing and other risks detailed from time to time in the
SEC reports of US Dataworks, Inc., including its annual report on
Form 10-KSB/A for the period ended March 31, 2004. These
forward-looking statements speak only as of the date hereof. US
Dataworks disclaims any obligation to update these forward-looking
statements. - Tables to Follow - STATEMENTS OF OPERATIONS For the
Three and Nine Months Ended December 31, 2004 and 2003 (UNAUDITED)
For the Three Months For the Nine Months Ended Ended December 31,
December 31, 2004 2003 2004 2003 Revenues Software licensing
revenues $95,000 $56,803 $595,732 $769,670 Software maintenance
revenues 246,455 66,999 706,383 181,143 Professional service
revenues 176,480 292,656 728,785 911,216 Total revenues 517,935
416,458 2,030,900 1,862,029 Cost of sales 147,689 206,043 666,337
555,698 Gross profit 370,246 210,415 1,364,563 1,306,331 Operating
expenses General and administrative 1,674,255 1,122,555 4,637,577
2,961,828 Depreciation and amortization 81,727 70,069 237,499
206,700 Total operating expense 1,755,982 1,192,624 4,875,076
3,168,528 Loss from operations (1,385,736) (982,209) (3,510,513)
(1,862,197) Other income (expense) Financing costs --- (135,814)
(419,903) (1,345,102) Interest expense (22,730) (128,826) (187,686)
(1,069,774) Interest expense - related parties --- --- ---
(113,360) Loss on extinguishment of debt --- --- --- (635,259) Loss
on extinguishment of debt - related parties --- --- --- (1,722,631)
Investor litigation settlement expense 75,800 --- (924,199) ---
Other income (expense) 12,761 3,635 30,448 3,635 Total other income
(expense) 65,831 (261,005) (1,501,340) (4,882,491) Loss before
provision for income taxes (1,319,905) (1,243,214) (5,011,853)
(6,744,688) Provision for income taxes --- --- --- --- Net loss
$(1,319,905) $(1,243,214) $(5,011,853) $(6,744,688) Basic and
diluted loss per share Total basic and diluted loss per share
$(0.05) $(0.05) $(0.19) $(0.39) Basic and diluted weighted-average
shares outstanding 27,800,238 22,772,365 26,725,216 17,388,793
Supplemental information: Software maintenance revenues
Transactional revenues $156,458 $34,999 $444,161 $55,664
Nontransactional revenues 89,997 32,000 262,222 125,479 Total
maintenance revenues $246,455 $66,999 $706,383 $181,143 BALANCE
SHEET December 31, 2004 (UNAUDITED) ASSETS Current assets Cash and
cash equivalents $2,734,134 Accounts receivable, net of allowance
for doubtful accounts of $0 640,080 Prepaid expenses and other
current assets 116,134 Total current assets 3,490,348 Property and
equipment, net 717,002 Goodwill, net 14,133,629 Other assets 43,793
Total Assets $18,384,772 LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities Note payable- related party $39,000 Deferred
revenue 283,764 Accounts payable 242,836 Accrued expenses 189,151
Interest payable 22,730 Convertible note payable 256,066 Total
current liabilities 1,033,547 Convertible note payable 512,133
Deferred revenue 41,683 Deferred compensation 94,600 Total
liabilities 1,681,963 Commitments Shareholders' equity Convertible
Series B preferred stock, $0.0001 par value 700,000 shares
authorized, 549,667 shares issued and outstanding, $0.75
liquidation preference, dividends of $159,352 in arrears 55 Common
stock, $0.0001 par value 90,000,000 shares authorized and
28,777,366 shares issued and outstanding 2,878 Common stock
subscription (129,375) Additional paid-in capital 61,737,402
Deferred compensation (63,395) Accumulated deficit (44,844,756)
Total shareholders' equity 16,702,809 Total Liabilities and
Shareholders' Equity $18,384,772 Contacts: John Reiland, CFO John
Figone, VP-Business Development US Dataworks, Inc. (713) 934-3855
http://www.usdataworks.com/ Ken Dennard, Managing Partner Karen
Roan, Sr. Vice President DRG&E (713) 529-6600 DATASOURCE: US
Dataworks CONTACT: John Reiland, CFO, or John Figone, VP-Business
Development, both of US Dataworks, Inc., +1-713-934-3855; or Ken
Dennard, Managing Partner, or Karen Roan, Sr. Vice President, both
of DRG&E, +1-713-529-6600, for US Dataworks Web site:
http://www.usdataworks.com/
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