VeriFone Provides Second Half Fiscal Year 2008 and Full Year Fiscal…

VeriFone Provides Second Half Fiscal
Year 2008 and Full Year Fiscal 2009 Guidance
SAN JOSE, Calif.--August 19, 2008-- VeriFone Holdings Inc.
(NYSE: PAY) today announced financial guidance for the fiscal quarter
ended July 31, 2008, the fiscal quarter ending October 31, 2008, and
the full year ending October 31, 2009. The full results for the fiscal
quarter ended July 31, 2008, will be announced on September 9, 2008.
    Douglas G. Bergeron, CEO of VeriFone, stated: "We expect our third
and fourth quarters, beginning in May of this year, to be positive in
many respects. Despite a slowdown in the US market, we are seeing
excellent growth internationally and in the emerging markets in
particular."
    For the third quarter ended July 31, 2008, VeriFone expects to
report net revenues of $256 - $258 million, representing revenue
growth rates of 10-11% over fiscal 2007. Gross margin percentages are
expected to improve as the company has initiated several programs to
improve efficiency, reduce product costs and change pricing
strategies. Results will continue to be affected by both the
restructuring charge and the restatement costs. EBITDA, as adjusted,
is expected to be in the range of $28 - $29 million, before adding
back approximately $15 million expected to be incurred for restatement
costs and restatement-related tax planning and $2 million for
restructuring costs. Non-GAAP net income, per share which adjusts for
certain non-cash items, valuation allowance adjustments and the effect
of restatement related and restructuring charges is projected to be in
the range of $0.34 to $0.35.

    For the fourth quarter ending October 31, 2008, VeriFone expects
to record net revenues of between $260 and $268 million, compared to
$238 million in the comparable period of 2007. VeriFone also
anticipates continued EBITDA margin expansion. EBITDA, as adjusted, is
expected to be in the range of $45 to $48 million, before adding back
final restatement costs estimated at $4 million. Non-GAAP net income,
per share, is projected to be in the range of $0.36 to $0.39.
    Fiscal Year 2009 Outlook

    "For fiscal year 2009, we are prudently expecting that weak
macro-economic conditions will prevail in North America and Western
Europe, though we expect continued favorable conditions in the
emerging markets," said Mr. Bergeron. "We are also working diligently
to control growth in operating expenses across the enterprise."

    For the full year ending October 31, 2009, VeriFone expects to
achieve net revenue growth of 10 to 15% annual growth, consistent with
its long-term growth targets. VeriFone is projecting continued
improvements to gross margins as the year progresses as a result of
product cost reduction initiatives and improved pricing strategies.

    VeriFone is expecting EBITDA, as adjusted, to be in the range of
$182 to $206 million; Non-GAAP net income, per share, in the range of
$1.35 to $1.55; and cash flow from operating activities in the range
of $110 to $125 million.
    CAUTION CONCERNING FORWARD-LOOKING STATEMENTS

    This press release includes certain forward-looking statements
within the meaning of the Private Securities Litigation Reform Act of
1995. These statements are based on management's current expectations
or beliefs and are subject to uncertainty and changes in
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circumstances. Actual results may vary materially from those expressed
or implied by the forward-looking statements herein due to changes in
economic, business, competitive, technological and/or regulatory
factors, and other risks and uncertainties affecting the operation of
the business of VeriFone Holdings, Inc. These risks and uncertainties
include: our ability to identify and complete acquisitions and
strategic investments and successfully integrate them into our
business, our ability to protect against fraud, the status of our
relationship with and condition of third parties upon whom we rely in
the conduct of our business, our dependence on a limited number of
customers, uncertainties related to the conduct of our business
internationally, our ability to effectively hedge our exposure to
foreign currency exchange rate fluctuations, our dependence on a
limited number of key employees, short product cycles, rapidly
changing technologies and maintaining competitive leadership position
with respect to our payment solution offerings. For a further list and
description of such risks and uncertainties, see our filings with the
Securities and Exchange Commission, including our annual report on
Form 10-K and our quarterly reports on Form 10-Q. VeriFone is under no
obligation to, and expressly disclaims any obligation to, update or
alter its forward-looking statements, whether as a result of new
information, future events, changes in assumptions or otherwise.

    About VeriFone Holdings, Inc. (www.verifone.com)
    VeriFone Holdings, Inc. ("VeriFone") (NYSE: PAY) is the global
leader in secure electronic payment solutions. VeriFone provides
expertise, solutions and services that add value to the point of sale
with merchant-operated, consumer-facing and self-service payment
systems for the financial, retail, hospitality, petroleum, government
and healthcare vertical markets. VeriFone solutions are designed to
meet the needs of merchants, processors and acquirers in developed and
emerging economies worldwide.

    Additional Resources:

    Investor Contact:
    William Nettles - Vice President, Corporate Development & IR

    Tel: 408-232-7979

    Email: ir@verifone.com
    http://ir.verifone.com/phoenix.zhtml?c=187628&p=irol-irhome

    Editorial Contact:
    Pete Bartolik
    VeriFone Media Relations

    Tel: 508-283-4112
    Email: pete_bartolik@verifone.com
    FINANCIAL MEASURES

    This press release and its attachments include the following
non-GAAP financial measures:
    --   EBITDA, as adjusted. This non-GAAP financial measure is
         comprised of net income (loss) excluding interest expense,
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         interest income, income taxes, depreciation, amortization,
         in-process research and development ("IPR&D"), stock-based
         compensation, acquisition related charges, restructuring
         costs, the non-cash portion of loss on debt extinguishment and
         write-off of capitalized software.
    --   Non-GAAP net income. This non-GAAP financial measure is
         comprised of EBITDA, as adjusted, a non-GAAP financial
         measure, adjusted for interest expense, net, and restatement
         and other restructuring costs, presented on an after-tax
         basis;
    --   Non-GAAP net income per diluted share.

    Reconciliations for the non-GAAP financial measures presented in
this press release are provided at the end of this press release.

    Management uses non-GAAP financial measures only in addition to
and in conjunction with results presented in accordance with GAAP.
Management believes that the use of the non-GAAP financial measures
presented in this release, in conjunction with results presented in
accordance with GAAP, helps it to evaluate VeriFone's performance and
to compare VeriFone's current results with those for prior periods as
well as with the results of other companies in VeriFone's industry.
VeriFone's competitors may, due to differences in capital structure
and investment history, have interest, tax, depreciation,
amortization, and other non-cash expenses that differ significantly
from VeriFone's. Management also uses these non-GAAP financial
measures in VeriFone's budget and planning process. In addition, if
VeriFone fails to maintain required levels of EBITDA, as adjusted, it
could have a default under its credit agreement, potentially resulting
in an acceleration of all of its outstanding indebtedness. Management
believes that the presentation of these non-GAAP financial measures
may be useful to investors for many of the same reasons that
management finds these measures useful. These non-GAAP financial
measures contain limitations and should be considered as a supplement
to, and not as a substitute for, or superior to, disclosures made in
accordance with GAAP.

    These non-GAAP financial measures may be different from non-GAAP
financial measures used by other companies and are not based on any
comprehensive set of accounting rules or principles. In addition,
these non-GAAP financial measures do not reflect all amounts and
costs, such as employee stock-based compensation costs, periodic costs
of assets used to generate net revenues and costs to replace those
assets, cash expenditures or future requirements for capital
expenditures or contractual commitments, cash requirements for working
capital needs, interest expense or the cash requirements necessary to
service interest or principal payments on VeriFone's debt, income
taxes and the related cash requirements, restructuring and impairment
charges and losses from discontinued operations, associated with
VeriFone's results of operations as determined in accordance with
GAAP.
    Furthermore, VeriFone expects to continue to incur expenses
similar to the non-GAAP adjustments described herein. Management
compensates for these limitations by also relying on the comparable
GAAP financial measures.

    Management excludes the following items from EBITDA as adjusted, a
non-GAAP financial measure, when evaluating VeriFone's operational
performance:

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    --   Provision for (benefit from) income taxes. While income taxes
         are directly related to the amount of pre-tax income, they are
         also impacted by tax laws and the company's tax structure. As
         the tax laws and the company's tax structure are not under the
         control of VeriFone's operational managers, management
         believes that the provision (benefit) for income taxes should
         be excluded when evaluating VeriFone's operational
         performance.
    --   Interest expense, net. While working capital supports the
         business, management does not believe that related interest
         expense or interest income is directly attributable to the
         operating performance of VeriFone's business.

    --   Depreciation and amortization of property, plant and
         equipment, and capitalized software. Management excludes
         depreciation because while these assets support the business,
         management does not believe the related depreciation and
         amortization costs are directly attributable to the operating
         performance of VeriFone's business. In addition, depreciation
         and amortization may not be indicative of current or future
         capital expenditures.

    --   Amortization of certain acquisition related items. VeriFone
         incurs amortization of purchased intangible assets and
         amortization of step-down in deferred revenue in connection
         with acquisitions. Management excludes these items because it
         does not believe these expenses are reflective of ongoing
         operating results in the period incurred. These amounts arise
         from prior acquisitions and management does not believe that
         they have a direct correlation to the operation of VeriFone's
         business.
    --   Stock-based compensation. These expenses consist primarily of
         expenses for employee stock options and restricted stock units
         under SFAS123 R. Management excludes stock-based compensation
         expenses from non-GAAP financial measures primarily because
         they are non-cash expenses which management believes are not
         reflective of ongoing operating results.

    Management uses Non-GAAP net income, a non-GAAP financial measure,
to evaluate VeriFone's overall performance. Non-GAAP net income is
determined by adjusting EBITDA, as adjusted, with the following items,
presented on an after-tax basis by applying VeriFone's long-term tax
rate.

    --   Interest expense, net. Since working capital supports the
         business, management does believe that related interest
         expense or interest income should be considered when
         evaluating the overall performance of VeriFone's business.

    --   Restatement and other restructuring costs. This represents
         charges incurred for audit and consulting fees related to the
         restatement of VeriFone's financial statements for the three
         quarters in the nine-month period ended July 31, 2007 and
         other restructuring costs. As management does not believe that
         these charges directly relate to the operation of VeriFone's
         business, management believes they should be excluded when
         evaluating VeriFone's operating performance.
    Non-GAAP Financial Measures


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                           SUPPLEMENTAL DATA
               VERIFONE HOLDINGS, INC. AND SUBSIDIARIES
                   RECONCILIATIONS OF GUIDANCE FOR
            NON-GAAP FINANCIAL MEASURES TO PROJECTED GAAP
           (IN MILLIONS, EXCEPT PER SHARE DATA; UNAUDITED)

                         Three Months Ending            Year Ending
                  ---------------------------------- ------------------
                    July 31, 2008   October 31, 2008 October 31, 2009
                  ----------------- ---------------- ------------------
                   From        To    From       To    From          To
                  ----------------- ---------------- ------------------
GAAP net income
 (loss) range     $(4.5)      $(3.8) $ 8.3      $ 9.8 $ 40.2      $ 52.7
 Provision for
  (benefit from)
  income taxes      4.5         4.8    8.2        9.5   37.1        48.6
                  ----------------- ---------------- ------------------
 Income (loss)
  before income
  taxes               -         1.0   16.5       19.3   77.3       101.3
 Interest
  expense, net            5.0               5.7              21.5
 Depreciation and
  amortization of
  property, plant
  and equipment,
  and capitalized
  software                3.9               3.8              14.8
 Amortization of
  purchased
  intangible
  assets and
  step-down in
  deferred
  revenue on
  acquisition            14.5              15.8              51.5
 Stock-based
  compensation            4.7               3.1              16.9
                  ----------------- ---------------- ------------------
EBITDA as
 adjusted range
 (1)              $28.1       $29.1  $44.9      $47.7 $182.0      $206.0
                  ================= ================ ==================

EBITDA as
 adjusted range $28.1         $29.1  $44.9       $47.7 $182.0        $206.0
 Interest
  expense, net          (5.0)              (5.7)              (21.6)
 Restatement and
  other
  restructuring
  costs (2) (3)         17.2                3.5                   -
                  ----------------- ---------------- ------------------
Non-GAAP pre-tax
 net income        40.3        41.3   42.7        45.5 160.4          184.4
 Tax at long-term
  rate of 28%      11.3        11.6   12.0        12.7   44.9          51.6
                  ----------------- ---------------- ------------------
Non-GAAP net
                                        Page 5
 income range (1)$29.0      $29.7   $30.7     $32.8 $115.5      $132.8
                 ================= ================ ==================

Non-GAAP net
 income per
 diluted share   $0.34      $0.35   $0.36      $0.39 $ 1.35     $ 1.55

Weighted average
 shares used in
 computing
 diluted Non-GAAP
 net income       84.6       84.6    84.9       84.9   85.6       85.6

(1) Management uses EBITDA as adjusted and Non-GAAP net income, both
 non-GAAP measures, to evaluate the Company's operating performance
 and compare the Company's current results with those for prior
 periods, but cautions that they should not be considered as
 substitutes for disclosures made in accordance with GAAP.
(2) Restatement and other restructuring costs for the three months
 ended July 31, 2008 consist of $15.4 million of restatement costs and
 $1.8 million of other restructuring costs.
(3) Restatement and other restructuring costs for the three months
 ended October 31, 2008 consist of $3.5 million of restatement costs.

    --30--

    CONTACT: VeriFone
             Investor Contact:
             William Nettles, 408-232-7979
             Vice President, Corporate Development & IR
             ir@verifone.com
             or
             VeriFone Media Relations
             Editorial Contact:
             Pete Bartolik, 508-283-4112
             pete_bartolik@verifone.com




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