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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The following discussion and analysis of our results of operations and
financial condition should be read in conjunction with the unaudited interim
condensed consolidated financial statements and related notes appearing
elsewhere in this Form 10-Q.
FORWARD-LOOKING INFORMATION
We have made forward-looking statements in this Report on Form 10-Q. These
statements are subject to risks and uncertainties, and there can be no guarantee
that these statements will prove to be correct. Forward-looking statements
include assumptions as to how we may perform in the future. When we use words
like "seek," "strive," "believe," "expect," "anticipate," "predict,"
"potential," "continue," "will," "may," "could," "intend," "plan," "target" and
"estimate" or similar expressions, we are making forward-looking statements. You
should understand that the following important factors, in addition to those set
forth above or elsewhere in this Report on Form 10-Q, our Prospectus dated
December 2, 1999, and our Form 10-K for the year ended March 31, 2000, could
cause our results to differ materially from those expressed in our
forward-looking statements. These factors include:
o our reliance on the fees generated by the transaction volume or product
sales of our clients;
o the impact of strategic alliances;
o trends in the market for our services;
o trends in e-commerce;
o whether we can continue and manage growth;
o changes in the trend toward outsourcing;
o increased competition;
o effects of changes in profit margins;
o the unknown effects of possible system failures and rapid changes in
technology;
o trends in government regulation; and
o our relationship with and separation from Daisytek.
We have based these statements on our current expectations about future
events. Although we believe that the expectations reflected in our
forward-looking statements are reasonable, we cannot guarantee you that these
expectations actually will be achieved. This Report on Form 10-Q also contains
other forward-looking statements, including those related to our completed
spin-off from Daisytek. The realization of the anticipated results could take
longer than expected and implementation difficulties and market factors could
alter anticipated results. These factors may cause our actual results to differ
materially from any forward-looking statements.
OVERVIEW
We are an international provider of transaction management services to both
traditional and e-commerce companies. We derive our revenues from a broad range
of services, including order management, Web-enabled customer contact centers,
billing services, information management, international fulfillment and
distribution services and professional consulting services. Our distribution
services are conducted at our warehouses and include picking, packing and
shipping our clients' customer orders. We offer our services as an integrated
solution, which enables our clients to outsource their
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