ATLANTA (October 30,2000) – John H. Harland Company (NYSE: JH) announced today that operating income increased 18 percent in the third quarter, excluding a one-time charge of $8.2 million for in-process research and development related to the company's acquisition of Concentrex Incorporated. The company attributes the increase to continued strength of its checks business and its Scantron subsidiary. Including the one-time charge, net income for the third quarter was $4.6 million, compared to $12.5 million a year earlier. Basic and diluted earnings per share for the quarter were $0.16, compared to $0.41 and $0.40, respectively, for the same period in 1999. Excluding the one-time charge, operating income was $23.1 million, up 18 percent from the $19.5 million reported in 1999. Revenues for the third quarter were $179.8 million, up 3.5 percent from $173.7 million a year earlier. Harland acquired Concentrex Incorporated in the third quarter, expanding its position as a leading provider of software to the financial institution market. Concentrex contributed revenue of $9.6 million in the five weeks since the acquisition. Excluding the in-process research and development charge, operating income from Concentrex during the same period was $0.5 million, which included amortization of intangibles. However, the acquisition negatively impacted net income by $9.1 million, or $0.31 per share, of which an in-process research and development charge accounted for $0.28. Research and development tax credits positively impacted earnings for the quarter by $0.03 per share. Excluding the negative impact of Concentrex and positive impact of the tax credits, diluted earnings per share were $0.44. Net income for the nine months ended September 29, 2000 was $28.5 million compared to $32.5 million for the first nine months of 1999. Basic and diluted earnings per share year-to-date were $1.00 and $0.99 respectively, compared to $1.05 and $1.04 basic and diluted earnings per share a year earlier. Revenues year-to-date were $528.2 million, compared to $530.9 million in 1999. Excluding the impact of Concentrex and the tax credits, net income was $36.7 million or diluted earnings per share year-to-date of $1.27. "The acquisition and integration of Concentrex was a key focus during the third quarter," said Timothy C. Tuff, chairman and chief executive officer of Harland. "The combined software business has been rationalized into four business units, and we will continue to make changes to position these business units for both growth and profit." The combined Concentrex and Harland software business now operates under the name Harland Financial Solutions. Its four business units are Delivery Systems, Mortgage Services, Host Processing and Financial Intelligence. Harland recently announced an agreement to sell certain on-line banking applications, acquired as part of the Concentrex purchase, to Netzee, Inc. (Nasdaq: NETZ) in exchange for 17 percent ownership in Netzee. "As we have said previously, our software business is a turnaround, but we believe we will be able to clearly demonstrate the enhanced value of this business for our customers and shareholders," said Tuff. "Our objective is to establish leadership positions in select markets, and the sale of our on-line banking business to Netzee will allow us to do this. We will be able to participate in the dynamic on-line banking industry while strengthening the profitability of our other businesses." Increased operating profits in the third quarter reflected the continued strength of checks and Scantron. Checks continued to benefit from per-unit improvements in the cost of manufacturing and revenue. The company remains on track with the expansion of digital technology in its imprint facilities, and this expansion is expected to result in further operational efficiencies and improved product quality in 2001. Third-quarter revenues for all three of Scantron's business units increased over 1999. Scantron's performance in the third quarter was positively impacted by strong sales in its traditional scanning business, including high-margin custom and standard forms. "While we are pleased with the efforts of all business units to improve profitability, we know that the creation of additional shareholder value is dependent on increasing revenue as well as profits," said Tuff. "We believe that the organization is poised to capitalize on opportunities to grow revenue by building on our channels of distribution and strengthening our leadership position in key markets." The company believes that its financial position continues to be strong. In the short-term, the company expects a dilutive impact from the Concentrex acquisition of approximately $0.15 for 2000. The company's checks operations are expected to continue to show year-over-year improvement in the fourth quarter. Harland anticipates that most of the remaining operations will be flat, with the exception of its traditional software group, which will be down from last year due to a decline in sales and the impact of new product costs. The company will continue the rationalization of its software business and anticipates that there will be further reductions in headcount. To the extent that these reductions are in the traditional Harland software business, they will be taken as a charge to earnings, totaling up to $1,000,000 in the fourth quarter. The company expects earnings per share for 2000 to be between $1.55 - $1.60, excluding the effects of Concentrex and one-time severance charges. Harland's board of directors declared a quarterly dividend of 7.5 cents per share, payable December 1, 2000 to shareholders of record as of November 19, 2000.