Fundtech Reports Financial Results for the First Quarter of 2008

FUNDTECH LTD. AND ITS SUBSIDIARIES Condensed Consolidated Balance Sheets (In Thousands) March 31, December 31, 2008 2007 --------- --------- ASSETS -------------------------------------------
------- Current assets: Cash and cash equivalents $ 31,846 $ 31,612 Short term deposits 4,053 1,765 Marketable securities - short term 6,721 8,624 Trade receivables, net 27,275 22,387 Defer Tax Asset 658 658 Other accounts receivable, prepaid expenses and inventories 5,079 2,942 --------- --------- Total current assets 75,632 67,988 Marketable securities - Long term 10,264 12,847 Severance pay fund 1,346 1,197 Long term lease deposits 783 778 Prepaid expenses 2,383 2,434 Property and equipment, net 14,611 14,070 Goodwill, net 30,918 26,802 Other assets, net 7,203 2,156 --------- --------- Total assets $143,140 $128,272 ========= ========= LIABILITIES AND SHAREHOLDERS' EQUITY -------------------------------------------------- Cu
rrent liabilities: Trade payables $ 2,209 $ 1,079 Deferred revenues 21,088 6,143 Accrued restructuring expenses 15 62 Employee and payroll accruals 5,565 6,298 Other accounts payable and accrued expenses 6,672 8,591 --------- --------- Total current liabilities 35,549 22,173 Accrued severance pay 1,693 1,518 Deferred taxes 951 878 Other long term liabilities 2,578 1,571 --------- --------- Total liabilities 40,771 26,140 --------- --------- Shareholders' equity: Share capital 47 47 Additional paid-in capital 152,460 151,547 Accumulated other comprehensive income (loss) (499) 506 Accumulated deficit (46,381) (46,710) Treasury stock, at cost (3,258) (3,258) --------- --------- Total shareholders' equity 102,369 102,132 --------- --------- Total liabilities and shareholders' equity $143,140 $128,272 ========= =========

FUNDTECH LTD. AND ITS SUBSIDIARIES Consolidated Statements of Operations (In Thousands, Except Share and Per Share Data) Three Months Ended March 31, ------------------------- 2008 2007 ---------- ---------- Revenues: Software license $ 4,865 $ 4,007 Software hosting 4,667 3,439 Maintenance 7,946 6,036 Services 10,576 9,689 ------------ ------------ Total revenues 28,054 23,171 ------------ ------------ Operating expenses: Software licenses costs 32 22 Amortization of capitalized software development costs -- 394 Amortization of other intangible assets 474 409 Maintenance, hosting and services costs (1) 13,271 10,200 Software development (1) 5,212 4,683 Selling and marketing (1) 4,831 4,231 General and administrative (1) 3,943 3,109 ------------ ------------ Total operating expenses 27,763 23,048 ------------ ------------ Operating income 291 123 Financial income, net 399 441 Income taxes (361) (136) ------------ ------------ Net income $ 329 $ 428 ============ ============ Net income per share: Net income used in computing income per share $ 329 $ 428 Basic income per share $ 0.02 $ 0.03 Diluted income per share $ 0.02 $ 0.03 Shares used in computing: Basic income per share 15,581,367 14,973,302 Diluted income per share 16,481,151 16,193,264 Adjusted non-GAAP(2) net income per share: Adjusted non-GAAP(2) net income used in computing income per share $ 1,608 $ 1,896 Adjusted non-GAAP(2) net income per share $ 0.10 $ 0.12 Shares used in computing adjusted non- GAAP(2) net income per share 16,481,151 16,193,264 Reconciliation of net income to adjusted non-GAAP(2) net income: Net income $ 329 $ 428 Amortization 474 803 Stock-based compensation 805 665 ------------ ------------ Adjusted non-GAAP(2) net income $ 1,608 $ 1,896 ============ ============ (1) Includes charges for stock-based compensation in 2008 and 2007 (2) See Reconciliation to GAAP

FUNDTECH LTD. AND ITS SUBSIDIARIES Consolidated Statement of Cash Flows (In Thousands) Three Months Ended March 31, ------------------ 2008 2007 ------- ------ CASH FLOWS FROM OPERATIONS: Net income $ 329 $ 428 Adjustments to reconcile net income to net cash provided by (used in) operating activities: Depreciation and amortization 1,883 1,853 Increase in trade receivables (4,462) (1,089) Increase in prepaid expenses, other accounts receivable and inventories (1,902) (1,462) (Decrease) increase in trade payables 668 (911) Increase in deferred revenues 15,288 9,311 Decrease in employee and payroll accruals (1,134) (48) Increase in other accounts payable and accrued expenses 1,336 231 Decrease in accrued restructuring expenses (47) (47) Increase in accrued severance pay, net 26 109 Increase in accrued interest on marketable securities 72 34 Increase in Deferred taxes 17 -- losses on disposition of fixed assets -- (7) Stock-based compensation 805 665 --------- -------- Net cash provided by operations 12,879 9,067 --------- -------- CASH FLOWS FROM INVESTING ACTIVITIES: Investment in held-to-maturity marketable securities (3,915) (7,777) Proceeds from held-to-maturity marketable securities 8,275 8,865 (Investment in) maturity of short term deposits (2,037) (3,932) Purchase of property and equipment (1,643) (1,406) Decrease in long-term lease deposits and prepaid expenses 12 4 Investments in subsidiaries (12,280) (5,019) Proceeds from sale of fixed assets -- 24 --------- -------- Net cash used in investing activities (11,588) (9,241) --------- -------- CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from the issuance of share capital and exercise of stock options and warrants, net 108 455 --------- -------- Net cash provided by (used in) financing activities 108 455 --------- -------- Effect of exchange rate on cash and cash equivalents (1,165) 275 --------- -------- Increase (decrease) in cash and cash equivalents 234 556 Cash and cash equivalents at the beginning of the period 31,612 28,616 --------- -------- Cash and cash equivalents at the end of the period $ 31,846 $29,172 ========= ======== Appendix A --------------------------------------------------- Investment in Subsidiaries ---------------------------------------------------[FEED_
CRLF] Working Capital $ (815) $ 689 Long term assets 5,555 1,999 Long term liabilities (39) -- Goodwill 7,579 2,331 --------- -------- $ 12,280 $ 5,019 ========= ========

Schedule A to Press Release Reconciliation to GAAP (In Thousands, Except Share and Per Share Data) The following information sets forth Fundtech's calculation of adjusted non-GAAP net income as contained in the Company's press release: Three Months Ended -------------------------- March 31, -------------------------- 2008 2007 ---------- ---------- Reconciliation of net income to adjusted non-GAAP net income: Net income $ 329(1) $ 428 Amortization of capitalized software development costs -- 394 Amortization of other intangible assets 474 409 Stock-based compensation charged as follows: Maintenance, hosting and services costs 183 72 Software development 82 61 Selling and marketing 155 150 General and administrative 385 382 ----------- ----------- Adjusted non-GAAP net income $ 1,608 $ 1,896 =========== =========== Adjusted non-GAAP net income per share $ 0.10 $ 0.12 =========== =========== Shares used in computing adjusted non-GAAP net income per share 16,481,151 16,193,264 =========== ===========