Trintech's medium-term goal is to move away from the product-based revenue on which it has traditionally relied in its core payments security business. The firm is aiming to grow its funds management systems (FMS) division, which sells financial management software to banks and other financial institutions to help manage back-office accounting. While product revenue fell 40% on the same quarter last year to $1.9m ( 1.5m), service revenue from its nascent FMS division grew by 8% to $3.5m ( 2.7m).

The $2.1m loss during the quarter is primarily explained by delays in rolling out its unattended payments systems, which allow customers to make purchases at vending machines, on petrol forecourts and in train stations using credit card PIN numbers.

The delays follow the firm's admission that technical problems with its payment hardware during the third quarter of last year contributed to a $387,000 loss during that period.

Despite the difficulties, Trintech has high hopes for the unattended payments business in the UK and in the Asia/Pacific region, where chip and PIN technology (familiar to many Irish shoppers in the shape of the handheld devices now used by most retailers to effect credit card payments) has been widely adopted.

Trintech president Paul Byrne said the company has several trials continuing with customers in both regions, but has been unable to start converting those trials into sales. Delays in integrating the systems with its customers' existing software and payment systems, typically provided by a range of different companies, credit card firms and banks, have slowed up that process.

"Our business model was that the unattended products would come in and replace chip and PIN and there would be a seamless transition in revenue from one to the other, " Byrne said.

Despite the delays in implementation, Trintech believes the opportunity presented by unattended payments is significant and that it is wellplaced to pick up sales given its reputation in chip and PIN, where its customers include music chain HMV and telecoms company O2.

"We have the sales force and we already have the customers because they are in pilot phase, " said Byrne.

One of its UK customers, Shell, recently lost 1.4m in a scam involving the harvesting of credit card details through payment terminals that had been tampered with by criminals posing as engineers. But Byrne said Trintech had not been damaged by the affair. It stood by the integrity of the system, he said, and certain elements of the case had been mis-reported in the media.

"Our customers are aware of the facts of the case and there's been no damage to our reputation, " he added.

While Trintech considers conditions in the payments business "challenging", there is growing optimism about the FMS business, and Trintech spent $5m during the first quarter on Assurity, a US-based software firm, to bolster that division.

Byrne said there is likely to be more corporate action in the year ahead as Trintech looks to grow its presence.

"We have ambitious growth plans. There will be alliances and there will be acquisitions, " he said. The company is currently looking at a "range of options".

Regardless of which path it pursues, however, Byrne said he expects Trintech to return to profitability in the current financial year. The revenue it had expected from unattended payments in the first quarter should begin to filter through during the second and third quarters. That, in turn, will support further investment in FMS, a higher margin business than payments.

Davy analyst Alan Daly is encouraged by Trintech's progress in FMS to date, but is not convinced by the payments side of the business, which he referred to as Trintech's "Achilles heel" in a research note following last week's results announcement.

In fact, the Davy analyst believes it may be time the company considered cutting its losses. Questioned about its intentions for the payments business in a conference call, Trintech said it was considering "a range of strategic options".

Daly said a sale should not be ruled out. "Given the growing gulf between the two businesses, we believe that if management were to exit the payments business at a reasonable price, it is likely that the stock would get a significant re-rating."

As things stand, Trintech is trading at around 3.30, having climbed just over 4% after the results, but slipped back later in the week as shareholders digested chief executive Cyril McGuire's comment about the "range of options".

Expect further movement in the months ahead when those options become clearer.