eBenX, Inc. Reports Financial Results for First Quarter 2001

Enrollment Increases 49 Percent



Apr 26, 2001, 01:00 ET from eBenX, Inc.

    MINNEAPOLIS, April 26 /PRNewswire/ -- eBenX, Inc. (Nasdaq:   EBNX), a
 leading provider of technology-based solutions for the administration of
 health and welfare benefits, today announced financial results for the first
 quarter ended March 31, 2001.
     Revenues for the first quarter increased 30 percent to $7.3 million
 compared with $5.6 million for the corresponding quarter in 2000, consistent
 with the low end of the guidance range provided by the Company during its last
 financial results conference call.  Excluding $712,000 in amortization of
 stock-based compensation and $5.7 million in amortization of goodwill and
 other intangibles, the pro forma net loss for the quarter was $4.1 million or
 $(0.21) per pro forma share compared with a net loss of $(0.07) per pro forma
 share for the same period one year ago.  Pro forma net loss per share also was
 consistent with the low end of the guidance range provided by the Company
 during its last financial results conference call.
     Enrollment for the quarter ended March 31, 2001 increased 49 percent to
 807,000, compared with 540,000 for same period one year ago.  Enrollment
 commitments grew to 725,000 from 600,000 for the same period one year ago, but
 decreased from 852,000 at the end of 2000.  The primary reason for the net
 decrease was the Company's decision to subtract the Verizon enrollment number
 from its enrollment commitments number, consistent with the Company's
 definition of commitments.  On March 2, 2001, the Company issued a news
 release about this client's decision to end its relationship with eBenX and
 said that eBenX will continue to provide service to and receive revenue from
 Verizon through the end of 2001.
     "Although we continue to struggle with current market conditions, we
 remain confident in our business strategy and optimistic about our future,"
 said John Davis, president and chief executive officer of eBenX.  "We have
 momentum emerging in the large employer market as we head into our traditional
 selling season, we are beginning to achieve sales results in the higher gross
 margin mid-market, and our very strong balance sheet enables us to survive and
 thrive.  However, we know it will take time before we are performing at or
 above our own expectations.  As we execute our plan and market conditions
 improve, we will continue to take previously described disciplined actions
 focused on managing our expenses, operating processes and sales strategy."
 
     Highlights
     The following milestones were completed or announced during the first
 quarter of 2001:
 
     * eBenX sold consulting services to two new large employers (a major
       airline and a large insurer).  eBenX also sold additional services to
       existing large employer customers, including a consulting contract to a
       newly acquired division of one of its largest current consulting
       customers, and administrative services to a new division of another
       current administrative services customer.
     * eBenX signed a definitive agreement with CitiStreet, the second largest
       record keeper in the U.S.  As previously announced, eBenX will provide
       health and welfare carrier feeds and audit, consolidated billing and
       payment, and supporting customer service under the CitiStreet service
       package.
     * eBenX made a number of mid-sized employer sales through brokers,
       including a technology manufacturer, a reinsurer, an e-business
       applications company, a stock brokerage,  and a supplier of industrial
       gas products.  The Company also sold technology and services to
       additional professional administrators.
     * PreferredOne, a Minnesota-based managed care organization, will use
       eBenX technology solutions to develop and implement its e-commerce
       strategy for several mid- and large-sized employer groups, including
       itself. Upon conclusion of the pilot, eBenX technology will be
       considered for use as the employer-facing e-commerce solution for the
       majority of PreferredOne's employer group business.
 
     Conference Call
     The Company plans to conduct a conference call discussing its financial
 results and strategy today, April 26, 2001, at 10:00 a.m., ET.  The company
 also plans to provide guidance on its 2001 outlook during this call.  The
 conference call will be simulcast live on the Internet, and can be accessed
 via a live audio feed available through the Company's Web site,
 http://www.ebenx.com.  To attend the Web conference call, click on the
 earnings conference call link and follow the prompted instructions.
 
     About eBenX
     eBenX (http://www.ebenx.com) provides specialized technology-based
 solutions for the administration of health and welfare benefits programs.  By
 applying the Internet, proprietary technology and strategic support resources,
 eBenX simplifies and automates the sharing of data and complex, ongoing and
 multiple financial and administrative transactions between parties in the
 health and welfare benefit supply chain.  The result is more choice and
 reduced administrative and medical costs for employers; improved efficiencies
 and strengthened client relationships for brokers and other benefit advisors;
 reduced administrative costs and the ability to offer multi-carrier products
 for health plans and carriers; and more choice, convenience and improved
 service for employees and their dependents.
 
     Forward-looking statements
     Other than historical information set forth herein, this announcement may
 contain forward-looking statements that involve risks and uncertainties.
 Actual results could be materially different from those discussed in this
 announcement.  Factors that could cause actual results to differ include,
 among others: eBenX's limited operating history, loss of any material
 customer, failure of the industry to accept eBenX services, industry
 competition, failure to establish and maintain successful relationships with
 strategic partners, waning demand for Internet and e-commerce solutions,
 inability to protect intellectual property, and state, federal and local laws
 and regulations.  Additional risks associated with eBenX's business can be
 found in its recent Registration Statement on Form S-1 and other periodic
 filings with the SEC.
 
                                    eBenX, Inc.
                            Consolidated Balance Sheets
                                    (Unaudited)
                                  (In thousands)
 
                                                     March 31,     December 31,
                                                       2001             2000
                                      ASSETS
       Current Assets:
          Cash and cash equivalents                    $900              $764
          Accounts receivable, net of allowance       4,799             3,973
          Unbilled revenue                            1,293             3,477
          Prepaid expenses and other                  1,343             1,234
          Short-term investments                     73,098            76,744
 
             Total current assets                    81,433            86,192
 
       Property and equipment, net                   10,759             9,800
       Notes receivable due from employees              494               492
       Deposits                                         103               103
       Goodwill and other intangibles, net           55,077            60,639
 
                Total assets                       $147,866          $157,226
 
                       LIABILITIES AND SHAREHOLDERS' EQUITY
 
       Current Liabilities
 
          Accounts payable                             $294              $150
          Accrued compensation                          624               585
          Accrued expenses                            2,993             2,928
          Deferred revenue                              177                93
 
             Total current liabilities                4,088             3,756
 
       Shareholders' equity
 
          Common stock                                  197               196
          Additional paid-in capital                182,116           182,246
          Deferred stock-based compensation          (5,319)           (6,241)
          Accumulated other comprehensive income         45                 8
          Retained deficit                          (33,261)          (22,739)
 
             Total shareholders' equity             143,778           153,470
 
                Total liabilities and
                 shareholders' equity              $147,866          $157,226
 
 
                                    eBenX, Inc.
                       Consolidated Statements of Operations
 
                                    (Unaudited)
                        (In thousands except per share data)
 
                                                        For the three months
                                                           ended March 31,
                                                       2001              2000
 
      Net Revenue                                     $7,316            $5,575
 
      Cost of services                                 6,651             4,271
            Gross profit                                 665             1,304
 
      Operating expenses:
         Selling, general and administrative           3,894             2,405
         Research and development                      2,206             1,589
         Amortization of stock-based compensation        712               631
         Amortization of goodwill
          and other intangibles                         5,663               --
            Total operating expenses                  12,475             4,625
 
      Loss from operations                           (11,810)           (3,321)
      Net interest income and other                    1,288             1,536
 
      Net loss                                      $(10,522)          $(1,785)
 
      Net loss per share:
         Basic and diluted                            $(0.54)           $(0.11)
 
      Shares used in calculation of net loss per share:
         Basic and diluted                            19,340            15,992
 
      Net loss before amortization of goodwill
       and stock-based compensation                  $(4,147)          $(1,154)
 
      Net loss per share before amortization of
       goodwill and stock-based compensation          $(0.21)           $(0.07)
 
 
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SOURCE eBenX, Inc.
    MINNEAPOLIS, April 26 /PRNewswire/ -- eBenX, Inc. (Nasdaq:   EBNX), a
 leading provider of technology-based solutions for the administration of
 health and welfare benefits, today announced financial results for the first
 quarter ended March 31, 2001.
     Revenues for the first quarter increased 30 percent to $7.3 million
 compared with $5.6 million for the corresponding quarter in 2000, consistent
 with the low end of the guidance range provided by the Company during its last
 financial results conference call.  Excluding $712,000 in amortization of
 stock-based compensation and $5.7 million in amortization of goodwill and
 other intangibles, the pro forma net loss for the quarter was $4.1 million or
 $(0.21) per pro forma share compared with a net loss of $(0.07) per pro forma
 share for the same period one year ago.  Pro forma net loss per share also was
 consistent with the low end of the guidance range provided by the Company
 during its last financial results conference call.
     Enrollment for the quarter ended March 31, 2001 increased 49 percent to
 807,000, compared with 540,000 for same period one year ago.  Enrollment
 commitments grew to 725,000 from 600,000 for the same period one year ago, but
 decreased from 852,000 at the end of 2000.  The primary reason for the net
 decrease was the Company's decision to subtract the Verizon enrollment number
 from its enrollment commitments number, consistent with the Company's
 definition of commitments.  On March 2, 2001, the Company issued a news
 release about this client's decision to end its relationship with eBenX and
 said that eBenX will continue to provide service to and receive revenue from
 Verizon through the end of 2001.
     "Although we continue to struggle with current market conditions, we
 remain confident in our business strategy and optimistic about our future,"
 said John Davis, president and chief executive officer of eBenX.  "We have
 momentum emerging in the large employer market as we head into our traditional
 selling season, we are beginning to achieve sales results in the higher gross
 margin mid-market, and our very strong balance sheet enables us to survive and
 thrive.  However, we know it will take time before we are performing at or
 above our own expectations.  As we execute our plan and market conditions
 improve, we will continue to take previously described disciplined actions
 focused on managing our expenses, operating processes and sales strategy."
 
     Highlights
     The following milestones were completed or announced during the first
 quarter of 2001:
 
     * eBenX sold consulting services to two new large employers (a major
       airline and a large insurer).  eBenX also sold additional services to
       existing large employer customers, including a consulting contract to a
       newly acquired division of one of its largest current consulting
       customers, and administrative services to a new division of another
       current administrative services customer.
     * eBenX signed a definitive agreement with CitiStreet, the second largest
       record keeper in the U.S.  As previously announced, eBenX will provide
       health and welfare carrier feeds and audit, consolidated billing and
       payment, and supporting customer service under the CitiStreet service
       package.
     * eBenX made a number of mid-sized employer sales through brokers,
       including a technology manufacturer, a reinsurer, an e-business
       applications company, a stock brokerage,  and a supplier of industrial
       gas products.  The Company also sold technology and services to
       additional professional administrators.
     * PreferredOne, a Minnesota-based managed care organization, will use
       eBenX technology solutions to develop and implement its e-commerce
       strategy for several mid- and large-sized employer groups, including
       itself. Upon conclusion of the pilot, eBenX technology will be
       considered for use as the employer-facing e-commerce solution for the
       majority of PreferredOne's employer group business.
 
     Conference Call
     The Company plans to conduct a conference call discussing its financial
 results and strategy today, April 26, 2001, at 10:00 a.m., ET.  The company
 also plans to provide guidance on its 2001 outlook during this call.  The
 conference call will be simulcast live on the Internet, and can be accessed
 via a live audio feed available through the Company's Web site,
 http://www.ebenx.com.  To attend the Web conference call, click on the
 earnings conference call link and follow the prompted instructions.
 
     About eBenX
     eBenX (http://www.ebenx.com) provides specialized technology-based
 solutions for the administration of health and welfare benefits programs.  By
 applying the Internet, proprietary technology and strategic support resources,
 eBenX simplifies and automates the sharing of data and complex, ongoing and
 multiple financial and administrative transactions between parties in the
 health and welfare benefit supply chain.  The result is more choice and
 reduced administrative and medical costs for employers; improved efficiencies
 and strengthened client relationships for brokers and other benefit advisors;
 reduced administrative costs and the ability to offer multi-carrier products
 for health plans and carriers; and more choice, convenience and improved
 service for employees and their dependents.
 
     Forward-looking statements
     Other than historical information set forth herein, this announcement may
 contain forward-looking statements that involve risks and uncertainties.
 Actual results could be materially different from those discussed in this
 announcement.  Factors that could cause actual results to differ include,
 among others: eBenX's limited operating history, loss of any material
 customer, failure of the industry to accept eBenX services, industry
 competition, failure to establish and maintain successful relationships with
 strategic partners, waning demand for Internet and e-commerce solutions,
 inability to protect intellectual property, and state, federal and local laws
 and regulations.  Additional risks associated with eBenX's business can be
 found in its recent Registration Statement on Form S-1 and other periodic
 filings with the SEC.
 
                                    eBenX, Inc.
                            Consolidated Balance Sheets
                                    (Unaudited)
                                  (In thousands)
 
                                                     March 31,     December 31,
                                                       2001             2000
                                      ASSETS
       Current Assets:
          Cash and cash equivalents                    $900              $764
          Accounts receivable, net of allowance       4,799             3,973
          Unbilled revenue                            1,293             3,477
          Prepaid expenses and other                  1,343             1,234
          Short-term investments                     73,098            76,744
 
             Total current assets                    81,433            86,192
 
       Property and equipment, net                   10,759             9,800
       Notes receivable due from employees              494               492
       Deposits                                         103               103
       Goodwill and other intangibles, net           55,077            60,639
 
                Total assets                       $147,866          $157,226
 
                       LIABILITIES AND SHAREHOLDERS' EQUITY
 
       Current Liabilities
 
          Accounts payable                             $294              $150
          Accrued compensation                          624               585
          Accrued expenses                            2,993             2,928
          Deferred revenue                              177                93
 
             Total current liabilities                4,088             3,756
 
       Shareholders' equity
 
          Common stock                                  197               196
          Additional paid-in capital                182,116           182,246
          Deferred stock-based compensation          (5,319)           (6,241)
          Accumulated other comprehensive income         45                 8
          Retained deficit                          (33,261)          (22,739)
 
             Total shareholders' equity             143,778           153,470
 
                Total liabilities and
                 shareholders' equity              $147,866          $157,226
 
 
                                    eBenX, Inc.
                       Consolidated Statements of Operations
 
                                    (Unaudited)
                        (In thousands except per share data)
 
                                                        For the three months
                                                           ended March 31,
                                                       2001              2000
 
      Net Revenue                                     $7,316            $5,575
 
      Cost of services                                 6,651             4,271
            Gross profit                                 665             1,304
 
      Operating expenses:
         Selling, general and administrative           3,894             2,405
         Research and development                      2,206             1,589
         Amortization of stock-based compensation        712               631
         Amortization of goodwill
          and other intangibles                         5,663               --
            Total operating expenses                  12,475             4,625
 
      Loss from operations                           (11,810)           (3,321)
      Net interest income and other                    1,288             1,536
 
      Net loss                                      $(10,522)          $(1,785)
 
      Net loss per share:
         Basic and diluted                            $(0.54)           $(0.11)
 
      Shares used in calculation of net loss per share:
         Basic and diluted                            19,340            15,992
 
      Net loss before amortization of goodwill
       and stock-based compensation                  $(4,147)          $(1,154)
 
      Net loss per share before amortization of
       goodwill and stock-based compensation          $(0.21)           $(0.07)
 
 
                     MAKE YOUR OPINION COUNT -- Click Here
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 SOURCE  eBenX, Inc.