TIE: 2010 Annual Result | TIE Kinetix is now SPS Commerce

Hoofddorp, The Netherlands

Business Results

During the fourth Quarter 2010 Total Income amounts to € 2,613k (Q4_2009: 2,802k). Operating Income Q4 amounts to € -1,103k (Q4_2009: € 219k) and Total Comprehensive Income to € -1,534k (Q4_2009: € 166k).
Total Income for the year amounts to € 11,013k (2009: € 11,190k), Operating Income amounts to € -1,393k (2009: € 759k) and Total Comprehensive Income amounts to € -1,763k (2009: € 540k). The net cash flow from operating activities for the year amounts to € -677k (2009: € 568k).

Our strategic investment in additional staff for the E-commerce and Content Syndication platforms needs more time to generate profit, also because of the increasing component of Software as a Service (Saas) generating an ongoing revenue stream as an annuity. We are in the process of reviewing our product portfolio, resulting for this reporting period in an amortization of Goodwill of € 171k for the software obtained in 2005 by the acquisition of Nspyre. Finally the company was engaged in two lawsuits. The costs associated with these suits amounted to € 987k. Additional onetime costs are € 250k. Thus the combined costs of the total onetime expenses for 2010 amounted to € 1,237k. The net cash flow for 2010 normalized for onetime expenses amounted to € 560k (2009: € 568k).

CEO Jan Sundelin said: “We have taken major steps to focus more clearly on the growing E‑commerce, Content Syndication and SaaS for Business Integration. Our relationships with our two most important partners, CNET (a division of CBS), and Epicor have been strengthened considerably. We have invested in sales, marketing, development and support staff in the E-commerce and the emerging Content Syndication businesses. For 2011, we expect limited growth of our Business Integration revenue for both license and SaaS. However, we are confident to further grow our E-commerce and Content Syndication business, through a combination of SaaS and Consultancy. TIE’s competitive advantage is the ability to merge its three platforms, resulting in a Total Integrated E-commerce solution”.

Starting fiscal year 2010 and up to this moment, the Company reported the following highlights:

Customers and Products

October 7, 2009: TIE reported that it entered into a partnership agreement with Intertrade Systems Inc. as well the sale of the Edge desktop business in the US to Intertrade Systems Inc. The income of this sale was realized in 2010.
October 21, 2009: TIE reports that it releases version 4.0 of the Translator, TIE’s any-to-any business document translation tool.
December 8, 2009: TIE reports that it appoints Siebe van Ineveld to promote the development of TIE’s business in EMEA.
February 23, 2010: TIE announces the release of version 3.0 of their Content Syndication Platform.
June 10, 2010: TIE reported that Capgemini Retail Solutions has exclusively selected Freeconnect as part of TIE’s Business Integration Platform.
June 17, 2010: TIE reported the selection of the TIE Kinetix Business Integration Platform by the Royal Malaysian Customs in cooperation with TIE’s partner Edaran IT Services Sdn Bhd.
June 24, 2010: TIE reported that TIE’s global strategic partner CNET Content Solution, a division of CBS Interactive, has teamed up with Lenovo to syndicate the PC maker’s content worldwide through ContentCast™ using the TIE Content Syndication Platform.
July 1, 2010: TIE reported that Microsoft was able to increase the online conversion rate of their office products with selected retailers by using the TIE Kinetix Content Syndication Platform.
August 3, 2010: TIE reported that Siemens Enterprise Communications GmbH (SEN) introduced their worldwide Digital Channel partner program, powered by the TIE Kinetix Content Syndication Platform, in China.
August 16, 2010: TIE reported the launch of the first online specialty shop for daily fresh food: Culinaireversmarkt.nl.
September 28, 2010: TIE reported that T-Mobile has implemented the TIE Kinetix E‑commerce Platform for its new online phone shop.
October 26, 2010: TIE reported that the ‘EDI managed services on demand’ is available for Epicor customers.
November 15, 2010: TIE reported that it is engaged in the European Unions Omelette project which aims at improving the internet as a global delivery platform with a specific focus on converged services in the telecom domain.

Legal and Financial

October 14, 2009: TIE announced that it has obtained a credit facility and that Rabobank becomes the new banker of TIE.
November 20, 2009: TIE announced that it is investigating a potential infringement on its Content Syndication Platform.
January 5, 2010: TIE reported the launch of 1.62M options under the Annual Stock Option plan.
January 29, 2010: TIE announces that it has published the Company’s 2009 Annual Report.
February 17, 2010: TIE reports Q1 trading update and announcement Annual General Meeting of Shareholders.
March 1, 2010: TIE reported the conversion of Convertible Bonds into shares of the Company for an amount of € 476k, representing 4,760,000 ordinary shares.
March 30, 2010: TIE reported the independent value proposition of the Company as made by Investablish B.V.
April 6, 2010: TIE reported that it exercised the 24.5% option on the shares of MamboFive B.V., TIE holds 100% of the shares in MamboFive B.V.
May 25, 2010: TIE publishes its first half year 2010 for the 6 months ended March 31, 2010.
July 9, 2010: TIE reported that the court has come to a ruling in the Samar case. All claims by Samar have been granted and TIE is ordered to pay full damages.
August 18, 2010: TIE reports the third quarter 2010.
August 31, 2010: TIE reported the issue of Convertible Bonds amounting to € 870k. The proceeds will be reserved for the outcome of current legal proceedings of the Samar case.
November 10, 2010: TIE reported that the credit facility with Rabobank will not be extended.

Financial and Cash Position

During Q4 2010 an amount of € 870k was added to the equity position of the Company as result of the issue of Convertible Bonds. CEO Jan Sundelin participated for an amount of
€ 30k, Supervisory Board members Peter van Schaick, through Alto Imaging Group NV participated for an amount of € 400k and Erik Honée for an amount of € 100k.

Shareholders’ Equity amounts to € 2,661k on September 30, 2010 (€ 2,417k on September 30, 2009). Equity per September 30, 2010 amounts to € 4,026k (€ 4,078k per September 30, 2009) including Convertible Bonds amounting to € 1,365k (€ 1,661k per September 30, 2009).

On September 30, 2010 the Company held a positive cash and cash equivalents position of € 327k (September 30, 2009 € 457k). The credit facility of € 350k was used for an amount of € 316k (September 30, 2009 nil).
The credit facility with Rabobank will not be extended. As a result of this, the credit facility will be reduced in steps and ends on February 28, 2011.
TIE is in the process of preparing documentation allowing financial institutions to make their Sales Pitch for facilitating TIE with credit. TIE expects that the repayment of the current credit facility will not lead to cash flow issues, due to the limited size of the facility.

Due to the onetime expenses the cash flow from operating activities was € -677k (2009: € 568k), if adjusted for the for the one time (cash) expenses, amounting to € 1,237k, the 2010 normalized operating cash flow was € 560k.

Amortization of Goodwill

The Company decided not to make longer use of the products obtained in 2005 through the acquisition of Nspyre B.V. Resulting from this decision an amount of €171k was amortized during Q4_2010.

Annual Accounts

The financial results of the Company are unaudited. The audit of the Company's Financial Statements will not be completed until the publication thereof in January 2011.

Samar claim

On July 7, 2010 the court granted unexpected all claims to Samar and TIE was ordered to pay full damages. On August 31, 2010 the Company paid to Samar an amount of € 804k consisting of the claim, legal interest and legal costs. The hit to our Q4_2010 results amounted to € 697k, net off the Companies own legal costs. As the Company has filed an appeal, the Company has set up a provision for the foreseeable legal costs.

Pending Litigations

Since December 2007 the Company has been involved in discussions and subsequently in legal proceedings with Samar. All claims in the summary proceedings were instantly dismissed at the court hearing of February 15, 2008. On July 7, 2010, the court of Haarlem unexpectedly granted all claims by Samar. In Q4_2010 TIE has paid damages, this amount may be adjusted upwards or downwards in the procedure regarding the assessment of the damages. TIE has filed an appeal.

On November 20, 2009, TIE initiated an investigation on a potential infringement on the Content Syndication Platform. On May 7, 2010 the judge pronounced a ruling in summary proceedings, dismissing TIE’s claim and ruling payment of the costs of litigation of the defendants. TIE has lodged an appeal against the ruling.

Consolidated Balance Sheet

At September 30

Assets
(EUR x 1,000)	2010		2009
	(unaudited)
Non Current Assets
Intangible fixed assets
Goodwill	2.402		2.546
Other intangible fixed assets	1.492		1.334

		3.894		3.880
Tangible fixed assets
Property, Plant and Equipment	164		180
		164		180
Financial fixed assets
Deferred Tax Asset	1.477		1.780
Loans and Receivables	38		40
		1.515		1.820
Total Non Current Assets		5.573		5.880

Current Assets
Non Current Assets hold for sale		-		198
Trade Debtors and Other Receivables:
Trade Debtors	1.839		1.817
Taxation and Social Security	4		10
Other Receivables and Prepayments	795		714
		2.638		2.541

Cash and Cash Equivalents		327		457
Total Current Assets		2.965		2.998

Total Assets		8.538		9.076

Consolidated Balance Sheet

At September 30

Liabilities
(EUR x 1,000)	2010		2009
	(unaudited)

Equity
Shareholders’ Equity	2.661		2.417
Convertible Bonds	1.365		1.661
Capital and Reserves attributable
to equity holders of TIE		4.026		4.078
Minority Interest		-		-
Total Equity		4.026		4.078

Non Current Liabilities
Provisions	11		8
Total Non Current Liabilities		11		8

Current Liabilities
Provisions short term	-		19
Settlement Liabilities short term	-		94
Short Term Debt	100		805
Credit Facility used	316		-
Trade Creditors	435		494
Deferred Revenue	1.911		1.981
Affiliated Companies	-		4
Taxation and Social Security	229		201
Other Payables and Accruals	1.510		1.392
Total Current Liabilities		4.501		4.990


Total Equity and Liabilities		8.538		9.076

Consolidated Income Statement

For the year ended September 30

(EUR x 1,000)	2010		2009
		(unaudited)
Revenues
Licenses	1497		1212
Maintenance and Support	2963		3243
Consultancy	2378		2458
Software as a Service	3377		3472
Total Revenues		10.215		10.385
Other Income		798		805
Total Income		11.013		11.190
Direct Purchase Costs		(1.307)		(1.367)
Income Net of Direct Purchase Costs		9.706		9.823

Operating Expenses
Employee Benefits	6.769		6.496
Onetime expenses	1.237		-
Depreciation and Amortization	503		360
Amortization of Goodwill	171		-
Other Operating Expenses	2419		2.208
Total Operating Expenses		11.099		9.064

Operating Income		(1.393)		759

Interest and other Financial Income		2		15
Interest and other Financial Expense		(64)		(48)
Income before Tax		(1.455)		726
Corporate Income Tax		(471)		(196)
Income after Tax		(1.926)		530
Other Comprehensive Income
Exchange differences on translating of foreign operations		163		10
Total Comprehensive Income		(1.763)		540
Attributable to Shareholders:
Income after Tax		(1.926)		530
Comprehensive Income		163		10

Net result per share – basic		(0,02)		0,01
Weighted average shares outstanding – basic (thousands)		77.486		58.346
Net result per share – diluted		(0,02)		0,01
Weighted average number of shares fully diluted (thousands)		80.060		72.397

Consolidated Cash Flow Statement

For the 12 months ended 30 September

(EUR x 1,000)	2010		2009
	(unaudited)
Income before tax		(1.455)		726

Non Cash Adjustments:
Share based payments expense	292		292
Depreciation and amortization	503		360
Amortization of Goodwill	171		-
Increase (decrease) provisions for redundancy, legal and rent building	(94)		(635)
Increase (decrease) provisions	(23)		24
Other movements	5		2
		854		43

Working Capital Movements
(Increase) decrease in debtors	(43)		(281)
(Decrease) increase in deferred revenue	(156)		147

(Decrease) increase in current liabilities	102		(69)
		(97)		(203)

Cash generated (applied) in operations		(698)		566
Interest paid		(34)		(13)
Interest received		2		15
Income taxes paid		53		-
Net Cash flow from operating activities		(677)		568

Disinvestments in intangible fixed assets	198		-
Disinvestment in financial fixed assets	2		(18)
Investments in intangible fixed assets	(608)		(572)
Disinvestments tangible fixed assets	-		-
Investments in tangible fixed assets	(88)		(87)
Acquisition of a subsidiary net of cash acquired	-		(332)
Dividend paid MamboFive to old shareholders	-		(191)
Net Cash flow generated / (used) in investing activities		(496)		(1.200)

Increase (decrease) bank overdrafts/loans short term	50		(439)
Issue of Convertible bonds	870		361
Costs of shares and bonds issued	-		-
Shares issued and share premium	107		80
Net Cash flow generated / (used) by financing activities		1.027		2

Net increase (decrease) in Cash and Cash Equivalents		(146)		(630)
Currency Exchange Rate Difference on opening balance Cash and Cash Equivalents		16		(1)
Opening balance Cash and Cash Equivalents		457		1.088
Closing balance Cash and Cash Equivalents		327		457


Net Cash flow from operating activities		677-		568
Onetime expenses	1.237		-
Cash Flow from onetime expenses		1.237		-
Normalized Net Cash Flow from operating activities		560		568

Consolidated Income Statement

For the 3 months ended September 30

(EUR x 1,000)	2010		2009
		(unaudited)
Revenues
Licenses	245		381
Maintenance and Support	751		775
Consultancy	566		596
Software as a Service	941		861
Total Revenues		2.503		2.613
Other Income		110		189
Total Income		2.613		2.802
Direct Purchase Costs		(354)		(326)
Income Net of Direct Purchase Costs		2.259		2.476

Operating Expenses
Employee Benefits	1.645		1.571
Onetime expenses	837		-
Depreciation and Amortization	136		112
Amortization of Goodwill	171		-
Other Operating Expenses	573		574
Total Operating Expenses		3.362		2.257

Operating Income		(1.103)		219

Interest and other Financial Income		2		4
Interest and other Financial Expense		(22)		(30)
Income before Tax		(1.123)		193
Corporate Income Tax		(189)		73
Income after Tax		(1.312)		266
Other Comprehensive Income
Exchange differences on translating of foreign operations		(222)		(100)
Total Comprehensive Income		(1.534)		166
Attributable to Shareholders:
Income after Tax		(1.312)		266
Comprehensive Income		(222)		(100)

Net result per share – basic		(0,02)		0,00
Weighted average shares outstanding – basic (thousands)		82.202		64.907
Net result per share – diluted		(0,02)		0,00
Weighted average number of shares fully diluted (thousands)		83.160		84.424

Segment info

For the three months ended September 30, 2010

	The Netherlands	North America	Rest of World	Holding and Eliminations	Total
Revenues
Licenses	49	106	90	-	245
Maintenance and Support	211	431	109	-	751
Consultancy	298	171	97	-	566
Software as a Service	403	298	240	-	941
Total Revenue	961	1.006	536	-	2.503
Other Income	121	12-	1	-	110
Total Income	1.082	994	537	-	2.613
Direct Purchase Costs	158	132	64	-	354
Income Net of Direct Purchase Costs	924	862	473	-	2.259

Operating Expenses
Employee Benefits	624	623	242	156	1.645
Onetime expenses	697	-	-	140	837
Depreciation and Amortization	88	35	6	7	136
Amortization of Goodwill	-	-	171	-	171
Other Operating Expenses	211	134	117	111	573
Total Operating expenses	1.620	792	536	414	3.362

Operating Income	696-	70	63-	(414)	1.103-
Interest and Other Financial Income	2-	1	1	2	2
Interest and other Financial Expense	(11)	(5)	-	(6)	(22)
Income before Tax	709-	66	62-	(418)	1.123-
Corporate Income Tax	12-	(165)	(2)	10-	(189)
Income after Tax	721-	(99)	(64)	(428)	(1.312)

For the three months ended September 30, 2009

	The Netherlands	North America	Rest of World	Holding and Eliminations	Total
Revenues
Licenses	255	78	48	-	381
Maintenance and Support	220	440	115	-	775
Consultancy	277	142	177	-	596
Software as a Service	465	221	175	-	861
Total Revenue	1.217	881	515	-	2.613
Other Income	189	-	-	-	189
Total Income	1.406	881	515	-	2.802
Direct Purchase Costs	217	103	6	-	326
Income Net of Direct Purchase Costs	1.189	778	509	-	2.476

Operating Expenses
Employee Benefits	672	522	235	142	1.571
Depreciation and Amortization Expense and Impairment Losses	62	47	1-	4	112
Other Operating Expenses	297	101	87	89	574
Total Operating expenses	1.031	670	321	235	2.257

Operating Income	158	108	188	(235)	219

Interest and Other Financial Income	4	-	-	-	4
Interest and other Financial Expense	-	-	-	(30)	(30)
Income before Tax	162	108	188	(265)	193
Corporate Income Tax	2	(166)	(6)	243	73
Net Income	164	(58)	182	(22)	266

Profile TIE

TIE (NYSE Euronext: TIE Holding) delivers innovative web centric, software based solutions that enable all trading partners in the supply chain to work seamlessly together on the major E-commerce processes of marketing, sales and fulfillment. With its TIE Kinetix concept, it provides a Total Integrated E-commerce process, embracing three innovative platforms for Business Integration (including e-invoicing, XML/EDI data synchronization), Content Syndication and E-commerce. The Total Integrated E-commerce solutions minimize the energy needed for a transaction lifecycle throughout the supply chain giving organizations the advantage to reduce cost and maximize revenue and profit.
TIE has more than two decades of experience in developing and implementing global E‑commerce standards. TIE is a listed company with offices in the United States, Australia, France and the Netherlands.

Further information:

TIE Holding N.V.

Jan Sundelin, CEO

Antareslaan 22-24
2132 JE Hoofddorp
The Netherlands

T:      +31-20-658 93 33
F:       +31-20-658 90 01
E:       info@TIEHolding.com
W:      www.TIEHolding.com

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