Affinity Announces Second Quarter Results

Business Wire, August 15, 2000

Business Editors

COLUMBIA, S.C.--(BUSINESS WIRE)--Aug. 15, 2000

Affinity Technology Group, Inc. (NASDAQ: AFFI) today announced financial results for the second quarter and six months ended June 30, 2000.

Revenues for the quarter were $679 thousand, with a net loss of $1.5 million, or $0.05 per share. Second quarter 1999 revenues were $1.2 million and the Company reported a net loss of $2.5 million, or $0.08 per share. The weighted average number of shares outstanding during the three months ended June 30, 2000 was 30.0 million, compared to 29.8 million for the same period in 1999.

For the first six months of 2000, revenues were $1.0 million, with a net loss of $3.3 million, or $0.11 per share. Revenues for the comparable period in 1999 were $1.5 million, with a net loss of $5.0 million, or $0.17 per share. The weighted average number of shares outstanding during the six months ended June 30, 2000 was 29.9 million, compared to 29.7 million for the same period in 1999.

Joe Boyle, President and Chief Executive Officer, stated, "During the second quarter we continued to focus on our key priorities: the continued development of the multi-lender decisioning system for Auto Credit Acceptance Ltd.; the deployment of additional Mortgage ALMs through our subsidiary, Surety Mortgage, Inc.; solidification and expansion of our intellectual property rights under our patents; and, the continued evaluation of capital raising alternatives. We believe we have made solid progress in these areas."

Affinity's technology enables financial institutions to link their branches, call centers, Internet customers, and indirect agents electronically to their credit departments, providing fully automated lending - and, if necessary, connectivity to a loan officer - through every channel. For financial institutions, Affinity's solutions expedite loan decisioning and processing and increase productivity and capacity of branch personnel, call center agents, loan officers, and indirect agents, while improving the overall customer experience. Affinity is located on the World Wide Web at www.affi.net.

Forward-looking statements in this news release, including statements regarding the multi-lender decisioning system, the deployment of ALMs through Surety Mortgage, Inc., patents, and capital raising initiatives, are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that forward-looking statements involve risks and uncertainties, including those related to general economic conditions, delays, risks, and uncertainties associated with the development and deployment of new technologies, consumer and industry acceptance of automated delivery channels, and regulatory risks, that may cause actual results to differ materially from those projected.

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Affinity Technology Group, Inc

Statements of Operations

                          Three months ended       Six months ended
                                June 30,                June 30,
                            2000        1999        2000        1999
                       ----------- ----------- ----------- -----------
Revenues:
  Transactions         $   150,355 $    94,389 $   312,151 $   217,935
  Mortgage processing
   services                113,307     153,851     187,168     267,250
  Sales and rental             -        34,213       3,000      38,963
  Professional services    309,503     790,452     319,503     790,452
  Patent license fees       65,000         -        90,000         -
  Other income              41,096      95,447     120,556     179,711
                       ----------- ----------- ----------- -----------
     Total revenues        679,261   1,168,352   1,032,378   1,494,311

Costs and expenses:
  Cost of revenues         223,969   1,030,673     335,296   1,200,501
  Research & development   153,063     519,353     482,996     818,478
  Selling, general
   and administrative
   expenses              1,842,449   2,244,311   3,615,339   4,675,993
                       ----------- ----------- ----------- -----------
     Total costs and
      expenses           2,219,481   3,794,337   4,433,631   6,694,972
                       ----------- ----------- ----------- -----------

Operating loss          (1,540,220) (2,625,985) (3,401,253) (5,200,661)
Interest income             34,957     113,853      84,831     234,818
                       ----------- ----------- ----------- -----------
Net loss               $(1,505,263)$(2,512,132)$(3,316,422)$(4,965,843)
                       =========== =========== =========== ===========
Net loss per share
 - basic and diluted   $     (0.05)$     (0.08)$     (0.11)$     (0.17)
                       =========== =========== =========== ===========
Shares used in computing
 net loss per share     30,021,808  29,755,930  29,949,436  29,697,963
                       =========== =========== =========== ===========


Balance Sheets                  June 30,
                            2000        1999
                       ----------- -----------

Cash and Short Term
 Investments           $ 1,728,462 $ 6,182,907

Total Current Assets     5,017,738  10,882,937

Total Assets            10,597,451  19,222,441

Total Liabilities        2,508,594   1,522,320

Stockholders' Equity     8,088,857  17,700,121