Proxicom Revenue More Than Triples and Profit Margins Expand; Focused Operations Deliver Pro Forma EPS of $0.05

Business Wire, July 19, 2000

Business Editors

RESTON, Va.--(BUSINESS WIRE)--July 19, 2000

Proxicom, Inc. (Nasdaq: PXCM), a leading e-business consulting and development company, today announced record revenue and profits for the second quarter ended June 30, 2000.

For the second quarter of 2000, revenue totaled $50.9 million, a 214% increase over the $16.2 million in the same period of 1999. On a quarterly sequential basis, revenue increased 33% from the $38.2 million for the first quarter of 2000. Gross margin for the second quarter of 2000 grew to 53%, compared with 44% for the second quarter of 1999 and marks the fourth consecutive quarter of improvement. Pro forma operating income (before amortization of intangibles and non-cash stock based compensation charges) was $4.2 million, representing an operating margin of 8% for the second quarter of 2000. This figure is compared to a pro forma operating income of $927,000, or 6%, for the second quarter a year ago and a pro forma operating income of $3.1 million, or 8%, for the first quarter of 2000. Pro forma net income (before amortization of intangibles and non-cash stock based compensation charges) was $3.2 million or $0.05 pro forma earnings per diluted share for the second quarter of 2000. This compared to pro forma net income of $828,000 for the second quarter of 1999, or $0.02 per diluted share, and pro forma net income of $2.7 million, or $0.04 earnings per diluted share, for the first quarter of 2000.

"Our record results are testament to the realization by new and existing customers that Proxicom stands apart in its ability to lead their high-impact e-business initiatives," said Raul J. Fernandez, chairman and chief executive officer of Proxicom. "We attribute Proxicom's selection by new marquee clients and our strong base of repeat business to our expert knowledge and ability to develop and deliver complex and transformational solutions."

For the six months ended June 30, 2000, the company recorded revenue of $89.1 million compared to $29.5 million for the first six months in the previous year. Pro forma operating income (excluding acquisition costs and non-cash stock based compensation charges) for the first six months of this year was $7.3 million, compared to pro forma operating income of $1.2 million in the previous year. Pro-forma net income for the six-month period ended June 30, 2000 was $5.9 million or $0.09 earnings per diluted share compared to pro forma net income of $981,000 or $0.02 earnings per diluted share in the first six months of the previous year.

In addition to the strong repeat business from existing customers such as Bayer Corporation, Chelsea CGA and General Motors, Proxicom secured new business from companies including GMAC and Chase Manhattan Corp. Proxicom continued to build out its leadership position to create multi-channel e-businesses. It demonstrated this ability through the launch of the first anytime, anywhere banking service for Cahoot, a division of premier U.K. bank Abby National Bank, which required the creation of a combined Internet, interactive television and wireless solution. Proxicom also secured new business to lead the definition of wireless e-business strategies for Carlson Wagonlit Travel and USA Today.

Proxicom operations added 175 service people in the second quarter, net, which includes 61 service people from its acquisition of Clarity, IBD, Ltd. The company also expanded its international presence with the opening of a wholly owned subsidiary in Paris, France.

About Proxicom

Proxicom, Inc. is a leading e-business consulting and development company that delivers innovative Internet and wireless solutions for Fortune 500 companies and other global, forward-thinking businesses. Our 900 strategy, creative and technology professionals provide specialized e-business development expertise for the following global practices: Energy & Telecom, Financial Services, Retail & Manufacturing and the Service Industries, which include the media and entertainment, travel and transportation businesses. Founded in 1991 as a systems integrator, Proxicom has developed and built e-businesses for such blue-chip companies as America Online, General Electric, General Motors, Merrill Lynch, Marriott International and NBC, among many others. With its headquarters in Reston, Va., Proxicom has offices in Chicago, Houston, London, Los Angeles, Madrid, Munich, New York, Paris, Rome, San Francisco, and Sausalito, Calif. For more information, please visit www.proxicom.com or call 1-877-PROXICOM.

"Safe Harbor" statement under the Private Securities Litigation Reform Act of 1995: Statements in this release regarding Proxicom, Inc.'s business which are not historical facts are "forward-looking statements" that involve risks and uncertainties. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements in this release, see the "Risk Factors" section in the company's prospectus dated April 19, 1999.