Bermuda-based First Ecom.com has ended its second full year of business with a strong cash position, despite posting losses of $17.8 million, the company announced this week.

The company, which is a global provider of electronic payment processing solutions and is still in the development stage said it was tightening its belt in a bid to improve its financials.

The company, which has Bank of Bermuda listed as a major shareholder, said it was reducing staff numbers and moving to smaller offices in a bid to cut costs.

And it said the downturn of the e-economy made them look at ways of "reducing the burn rate''.

The company posted revenues for the fiscal year 2000 of $854,871 as compared with revenues for 1999 of $2,634.

The company said the increase is attributable to a rise in revenues from payment processing and systems integration revenue contributed by Asia Internet Limited, a business acquired on March 31, 2000.

Net loss for the year 2000 after amortisation, depreciation and non-cash compensation associated with stock options was $17,809,461 as compared to the year 1999 operating loss of $6,788,885.

The current year's loss includes one-time non-recurring losses totalling $4,038,182 for the write-down of certain assets to their net realisable value.

The company said it also recognised a new expense relating to an additional inputted interest charge of $380,000 for warrants issued with debt in 1999 due to the implementation of the Emerging Issues Task Force pronouncement (EITF) 00-27.

This is an accounting change that the company was required to implement in the 2000 year.

Net loss per share for the year 2000 was $0.98 per share as compared to the net loss per share of US$ 0.56 for the year 1999.

At December 31, 2000, the company had in excess of $31,000,000 cash on hand as compared to $11,000,000 at December 31, 1999.

"Our second full year of operations saw a dramatic change in the business environment,''said Gregory Pek, president and Co-CEO of First Ecom.com. "This change plus some internal issues resulted in First Ecom having to change its business approach.

"During the last quarter of 2000 the board and management started to restructure and re-focus the company in addition to significantly reducing the burn rate.

"These changes should be completed and start to bear fruit within the first half of 2001. The major changes made included a reduction in staff levels, which included the closing of Asia Internet Limited and the withdrawal from the business of systems integration as well as moving to smaller premises. The Company also formed First Ecom Data Services Asia Limited (FEDS Asia), which is primarily responsible for the selling of the newly productised First Ecom gateway to banks in Asia.'' Mr. Pek added that with the new structure and focus plus strong cash position the company "can build upon the successes it had during 2000''.

He said these achievements included the raising and preserving of significant capital, listing on National Market of the NASDAQ in June, listing on the Bermuda Stock Exchange, the bringing on-line of two banks in Hong Kong during September and December and the formation and the "start of operations of First Ecommerce Data Services (FEDS) our joint venture with the Bank of Bermuda''.