Atlanta-based electronic billing and payments company CheckFree Corp. is
eliminating about 450 more jobs and closing four offices, while raising its
guidance for third quarter pro forma earnings per share to 3 to 5 cents.
CheckFree saw its stock price dip last week when Deutsche
Banc Alex Brown lowered its earnings and revenue estimates for 2003, citing
stiff competition in the industry.
The company said today that the office consolidations and job cuts, which
will mean one-time charges of $14 to $16 million, are expected to add about 3
cents per share, pro forma, in fiscal fourth quarter 2002, and as much as 20
cents per share, pro forma, in fiscal 2003.
The consolidation of transaction processing from three legacy platforms onto
CheckFree’s state-of-the-art platform, Genesis, is letting the company
streamline its Electronic Commerce Division.
The market’s initial take on the news was positive; the stock was up 48 cents
to $15.08 per share in the early going.
In January, CheckFree said it would close its San
Francisco-based customer operations center in April, shedding about 100 jobs
there.
Now, the company will close its Houston and Austin, Texas facilities this
summer, and manage all e-commerce business through four remaining locations:
Aurora, Ill.; Dublin, Ohio; Norcross, Ga.; and Phoenix. About 150 jobs will
be lost in Texas and another 150 across the four remaining sites of the
Electronic Commerce Division.
The company also plans to close its i-Solutions offices in Ann Arbor, Mich.
and Singapore, cutting about 100 jobs in those offices. About 50 positions in
corporate staff functions also are being cut.
“We are executing on our plans to consolidate operations in our Electronic
Commerce Division, and to derive further economic benefits from a variety of
operational initiatives,” said Pete Kight, CheckFree’s chairman and chief
executive officer. “These business improvements are beginning to translate
into economic gains that enable us to improve our financial performance …”
CheckFree launched its first integrated electronic billing and payment
solution in 1997. As of December 31, 2001, its Electronic Commerce division
enabled 5.9 million consumers to receive and pay bills electronically. For
its last fiscal year ending June 30, 2001, the company lost $363 million.