eSpeed, Inc. (ticker: ESPD, exchange: Nasdaq) News Release - Monday, January 31, 2000
eSpeed's Revenue From Electronic Transactions Increases 142
eSpeed Reports Revenues of $14.0 Million for the 1999 Fourth Quarter,
$38.2 Million for the Year
Revenues Exceed Expectations
NEW YORK, Jan. 31 /PRNewswire/ -- eSpeed, Inc. (Nasdaq: ESPD), a leading provider of
real-time business-to-business electronic marketplaces, today announced impressive financial
results for the fourth quarter and period ended December 31, 1999.
Revenues for the quarter ended December 31, 1999 totaled $14.0 million, a 21% increase over third
quarter revenues. The Company reported a net loss of $6.0 million, or $(0.13) per share for the
1999 fourth quarter, after posting a net loss of $3.4 million in the third quarter. Fully electronic
transaction revenues totaled $6.3 million, a 142% increase over the third quarter, and transaction
revenues overall increased 38% over the third quarter.
For the period March 10, 1999 (date eSpeed, Inc. commenced operations) through December 31,
1999, the Company reported total revenues of $38.2 million. The Company's net loss was $12.6
million, or $(0.28) per share for the same period.
Commenting on eSpeed's performance, Howard W. Lutnick, Chairman and Chief Executive Officer
said, "Our products are rolling out on target and they are being received enthusiastically. eSpeed is
powered by the combined strength of the leading trading technology in the industry, and the
brightest minds in the industry. Our business is exciting on all fronts, with fourth quarter fully
electronic trading volumes greater than projected, and revenue from electronic transactions up
142% from last quarter."
"eSpeed technology currently handles $150 billion in financial transactions daily. Since our system
is scalable and extendable, the same technology that processes trillions of dollars in financial
transactions can handle transactions in any non-financial product as well. eSpeed is the trading
platform for fast, cost-efficient B2B marketplaces and exchanges in virtually any vertical market
segment," added Mr. Lutnick. "Whether the product is Treasury bonds, electricity or industrial
products, eSpeed technology can provide the end to end, B2B solution."
Frederick T. Varacchi, President and COO of eSpeed added, "Our technology is built and paid for,
it's been proven in one of the largest marketplaces in the world and it's proprietary- this is the
formula for successful growth as eSpeed moves aggressively into new markets." Of eSpeed's 370
employees, 330 are technology professionals who work in-house creating the software, programs
and transactional infrastructure that provide the technological backbone of eSpeed. Varacchi, who
is himself a former Chief Technology Officer, noted that the eSpeed trading platform is based on
the company's patented, rules-based processing method known as Interactive Matching.
Varacchi also noted that "With the $144 million in proceeds received from our initial public offering,
we intend to dramatically increase spending on technology and personnel to continue to maintain
eSpeed's competitive technological advantage. It is critical for us to ensure our technological
platform remains the envy of the B2B business world."
"We have continued to increase the number of clients using the eSpeed system. This strong
acceptance of the eSpeed trading platform, the absence of a Y2K market slowdown and an
increase in market volatility contributed to a greater revenue stream than expected," added Kevin
Piccoli, eSpeed's Chief Financial Officer. Piccoli also noted that the company's bottom line
reflected a lower than anticipated level of operating expenses. "We anticipate that we will continue
to add significantly to our technology staff throughout the year," Piccoli added.
Commenting on future plans, CEO Howard Lutnick added, "Our eSpeed system has a flexible
design which allows us to quickly and easily add new products and services. Our strategy is to
continue to add new products and markets to the eSpeed platform to create real-time electronic
marketplaces for virtually any B2B or financial product. Toward this end, we are actively pursuing
partners, either through joint ventures, acquisition, or other alliances that want to join eSpeed in
creating the fastest, most efficient B2B marketplaces in the world."
During the quarter, eSpeed, Inc. completed its initial public offering of 10,350,000 shares at $22 per
share on December 10, 1999, of which 7 million shares were sold by the Company raising $144
million in proceeds.
About eSpeed
eSpeed, Inc. operates multiple buyer/multiple seller real-time business- to-business electronic
marketplaces. eSpeed's suite of marketplace tools provides an end-to-end solution -- transaction
processing, network distribution, risk management, back-end processing and billing -- for the
trading of any product via the Internet or over eSpeed's global private network. eSpeed currently
provides the marketplace infrastructure for over 20 financial markets, transacting over $150 billion of
financial instruments daily. eSpeed is headquartered in New York. Additional information on
eSpeed is available via the Internet at http://www.espeed.com .
Statements contained in this Press Release which are not historical facts are forward-looking
statements, as the term is defined in the Private Securities Litigation Reform Act of 1995. Such
forward-looking statements are subject to risks and uncertainties which could cause actual results
to differ materially from those currently anticipated due to a number of factors, which include, but
are not limited to: the Company's limited operating history, its expected incurrence of future losses
and negative cash flow from operations for the foreseeable future, its ability to enter into marketing
and strategic alliances, to effectively manage its growth, to expand the use of its electronic
systems, and to induce customers to use its marketplaces and services and other factors that are
discussed in the Company's Registration Statement on Form S-1 filed with the Securities and
Exchange Commission.
eSpeed, Inc. and Subsidiaries
CONSOLIDATED STATEMENT OF FINANCIAL CONDITION
December 31, 1999
UNAUDITED
Assets
Cash $201,001
Securities purchased under reverse
repurchase agreements 134,644,521
Receivable from affiliates
Fixed assets, at cost 12,556,627
Less accumulated depreciation
and amortization (3,086,555)
Fixed assets, net 9,470,072
Prepaid expenses, principally computer
maintenance agreements 11,495
Total assets $144,327,089
Liabilities and Stockholders' Equity
Liabilities:
Payable to affiliates, net $6,743,929
Accounts payable and accrued liabilities 2,071,347
Total liabilities 8,815,276
Commitments and contingencies
Stockholders' equity:
Preferred stock, par value $0.01 per share;
50,000,000 shares authorized, no share
issued or outstanding --
Class A common stock, par value $0.01 per share;
200,000,000 shares authorized; 10,350,000
shares issued and outstanding 103,500
Class B common stock, par value $0.01 per share;
100,000,000 shares authorized; 40,650,000
shares issued and outstanding 406,500
Additional paid in capital 147,588,726
Accumulated deficit (12,586,913)
Total stockholders' equity 135,511,813
Total liabilities and stockholders' equity $144,327,089
eSpeed, Inc. and Subsidiaries
CONSOLIDATED STATEMENT OF OPERATIONS
For the period from March 10, 1999
(date of commencement of operations) to December 31, 1999
UNAUDITED
Quarter ended
March 10 to June 25, Sept. 24, Dec. 31,
March 26, 1999 1999 1999 1999
Revenues:
Transaction revenues
Fully electronic $76,621 $1,153,471 $2,590,715 $6,259,035
Voice assisted 664,597 3,900,345 3,817,144 3,395,220
Open outcry 379,316 1,376,962 1,075,426 692,695
Total transaction
revenues 1,120,534 6,430,778 7,483,285 10,346,950
Interest income 347,804
System service fees
from affiliates 827,716 4,138,578 4,138,578 3,354,702
Total revenues 1,948,250 10,569,356 11,621,863 14,049,456
Expenses:
Compensation and
employee benefits 1,267,838 6,403,446 7,033,656 6,797,386
Occupancy and
equipment 676,023 2,854,350 3,102,063 3,659,913
Professional and
consulting fees 185,985 1,596,097 1,833,266 1,533,448
Communications and
client networks 221,159 1,103,081 1,121,552 909,278
Transaction service
fees paid to
affiliates 26,817 403,715 906,750 2,190,663
Administrative fees
paid to affiliates 93,701 461,266 512,233 594,858
Options granted to
Cantor employees -- -- -- 2,841,053
Other 15,235 500,034 606,850 1,536,011
Total expenses 2,486,758 13,321,989 15,116,370 20,062,610
Loss before benefit
for income taxes (538,508) (2,752,633) (3,494,507) (6,013,154)
Income tax benefit:
Federal
State and local 13,635 69,694 88,478 40,082
Total tax benefit 13,635 69,694 88,478 40,082
Net loss ($524,873) ($2,682,939) ($3,406,029) ($5,973,072)
Per share data:
Basic net loss
per share ($0.01) ($0.06) ($0.08) ($0.13)
Weighted average
shares of
common stock
outstanding: 44,000,000 44,000,000 44,000,000 45,530,000
March 10 to
Dec. 31, 1999
Revenues:
Transaction revenues
Fully electronic $10,079,842
Voice assisted 11,777,306
Open outcry 3,524,399
Total transaction revenues 25,381,547
Interest income 347,804
System service fees from affiliates 12,459,574
Total revenues 38,188,925
Expenses:
Compensation and employee benefits 21,502,326
Occupancy and equipment 10,292,349
Professional and consulting fees 5,148,796
Communications and client networks 3,355,070
Transaction service fees paid to affiliates 3,527,945
Administrative fees paid to affiliates 1,662,058
Options granted to Cantor employees 2,841,053
Other 2,658,130
Total expenses 50,987,727
Loss before benefit for income taxes (12,798,802)
Income tax benefit:
Federal
State and local 211,889
Total tax benefit 211,889
Net loss ($12,586,913)
Per share data:
Basic net loss per share ($0.28)
Weighted average shares of common stock outstanding: 44,495,000
CONTACT: analysts - Kevin Piccoli, 212-938-4844, or media - Chris Staszak, 212-938-3712, both
of eSpeed, Inc.; or investors - Christie Mazurek of Financial Relations Board, 212-661-8030, for
eSpeed, Inc.
SOURCE eSpeed, Inc.
CONTACT: analysts - Kevin Piccoli, 212-938-4844, or media - Chris Staszak, 212-938-3712, both
of eSpeed, Inc.; or investors - Christie Mazurek of Financial Relations Board, 212-661-8030, for
eSpeed, Inc./
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nwo1
: Ich gratuliere allen longs und an Kern VERT -7,17% und ESPD +++11,7% USD ;)) o.T.
