NEWPORT BEACH, Calif. – April 22, 2003 – The TriZetto® Group, Inc. (Nasdaq:TZIX) reported financial results today for the first quarter ended March 31, 2003. The company's first quarter pro forma earnings per share exceeded analysts' consensus estimates.

"Our first quarter performance was on target, with internal revenue growth of 16% and a 45% increase in earnings before interest, taxes, depreciation and amortization (EBITDA)," said Jeffrey H. Margolis, TriZetto's chief executive officer. "Our first quarter net loss narrowed by 42% over the same quarter last year, reflecting operational improvements and an intangible asset impairment charge taken in the fourth quarter of 2002. We now expect to report our first profit as a public company in the fourth quarter of this year. We funded our software development and other strategic initiatives during the quarter, using less capital than planned. Our financial position remained solid, with $85.7 million in cash and equivalents at quarter's end."

First Quarter Financial and Operations Highlights

• Total revenue grew to $69.0 million in the first quarter of 2003, an increase of 16% over the $59.7 million reported in the first quarter of 2002. All of the increase was from existing operations.
• EBITDA was $5.9 million in the first quarter of 2003, compared with EBITDA of $4.1 million in the first quarter of 2002.
• Net loss for the first quarter of 2003 improved to $2.7 million or $0.06 per diluted share from a net loss of $4.6 million or $0.10 per diluted share in the first quarter last year.
• Diluted pro forma earnings per share were $0.02 in the first quarter of 2003, compared with $0.03 in the same quarter last year. (Note: Pro forma numbers exclude acquisition-related expenses. For a detailed definition of pro forma, see attached financial statements. First quarter 2003 pro forma numbers were taxed at 40% while 2002 pro forma numbers were taxed at approximately 5%.)
• Days sales outstanding were 65 for first quarter 2003, compared with 72 in the same quarter last year.
• Total revenue backlog at March 31, 2003 was approximately $574.9 million. Twelve-month revenue backlog was approximately $178.0 million. The timing of contract closings and other factors can cause the company's backlog to vary from one quarter to the next.
• 351 contracts were signed in the first quarter, with a total value of $62.2 million. 44 of these were business services contracts (software hosting and other outsourced services) valued at $27.8 million, and 78 were software license contracts valued at $23.7 million. 229 contracts were for consulting and implementation services, valued at $27.8 million.

"We believe the changes we have made to improve sales are beginning to show results. We signed new bookings of $62.2 million in the quarter, with substantial contracts in all three strategic business units – proprietary software, consulting and outsourced services. Under the largest of these contracts, we significantly expanded our role in implementing Facets for the managed care segment of a health plan with several million members. (The customer prefers to remain unnamed until the project is fully completed.) After the end of the first quarter, that same customer signed an agreement under which TriZetto will host Facets for the customer's managed care business. In addition, we signed Facets license and implementation agreements with CareSource, a former AMISYS customer, and the behavioral health, dental and vision units of PacifiCare Health Systems. In our benefits administration business, we also signed several sizeable contracts, including a renewal with PacifiCare's PPO unit, and new contracts with Mutual of Omaha and HealthNetworks."

"Our payer sales cycles continue to be a year or longer, particularly with larger health plans or customers that are considering the purchase of multiple TriZetto products and services," Margolis continued. "Even so, we are encouraged by the opportunities in our pipeline and confident that our market share will continue to expand over time. Given our focus on health plans and benefits administrators, on-going investment in our enterprise software, and comprehensive products and services, we believe we are positioned to win over the long term."

Financial Review / Outlook

Financial guidance for the second quarter of 2003 and fiscal year 2003 is attached to this press release. Guidance for fiscal year 2003 remains unchanged from April 1, 2003; guidance for the second quarter of 2003 is new. Guidance is also posted on the company's web site at www.trizetto.com, "Investor Relations", "Financial Reports". TriZetto's actual financial results may vary from guidance, depending upon the timing of contract signings, competition, changes in demand for products and services, and such other factors identified in TriZetto's Form 10-K and other SEC filings.

Revenue – First quarter revenue totaled $69.0 million, up 16% from $59.7 million in the first quarter of 2002. All of the increase was organic, the result of growth in software license, maintenance and implementation revenue. Given the typical seasonality of its software license revenue, the company expects revenue to be lower in the first half of 2003 than in the second half. For the second quarter of 2003, total revenue is expected to range from $74 - $78 million.

Recurring revenue totaled $39.1 million in the first quarter of 2003 and non-recurring revenue was $29.9 million. Recurring revenue in the first quarter was 57% of total revenue, compared with 67% in the first quarter of 2002 and 55% in the fourth quarter of 2002. The year-over-year decrease in the percentage of recurring revenue reflects a change in the mix of business, toward non-recurring revenue associated with several large customer implementations and software license contracts.

EBITDA – TriZetto posted EBITDA of $5.9 million in the first quarter of 2003, compared with $4.1 million in the first quarter of 2002. The improvement in EBITDA reflects higher revenue and continued emphasis on pricing discipline and cost control throughout the company. The company expects EBITDA to be lower in the first half of 2003 than in the second half of the year, reflecting seasonally lower revenue that is typical in the first half of the year. For the second quarter of 2003, EBITDA is expected to range from $7.0 - $7.5 million.

Net Loss/Per Share Data – TriZetto reported a net loss of $2.7 million in the first quarter of 2003, or a loss per diluted share of $0.06, compared with a loss of $4.6 million or $0.10 per diluted share in the first quarter of 2002. This improvement is primarily the result of an intangible asset impairment charge taken in fourth quarter 2002, which eliminated part of the acquisition-related amortization of intangible assets from the company's income statement. The impairment charge was taken in accordance with Financial Accounting Standards 142 and 144. For the second quarter of 2003, the net loss is expected to range from $1.9 – $2.5 million, and the net loss per share is expected to range from $0.04 - $0.05.

TriZetto's pro forma net income in the first quarter of 2003 was $0.92 million, or $0.02 per diluted share, compared to pro forma net income of $1.3 million, or $0.03 per diluted share in the first quarter of 2002. In the first quarter of 2003, TriZetto began taxing its pro forma earnings at 40%. The decline in first quarter 2003 pro forma net income, compared with the same quarter last year, is the result of the higher tax rate. For the second quarter of 2003, pro forma net income is expected to range from $1.0 - $1.5 million, and pro forma earnings per share are expected to range from $0.02 - $0.03.

Cash Resources – Cash, restricted cash and short-term investments totaled $85.7 million at March 31, 2003. TriZetto generated approximately $9.7 million in cash from operations during the first quarter of 2003.

About TriZetto

The TriZetto Group, Inc. offers a broad portfolio of healthcare information technology (IT) products and services that can be delivered individually or combined to create a comprehensive solution.

The company provides:

• leading proprietary and third-party software, including e-business applications;
• outsourced services, such as software hosting, transaction processing and IT department operations; and
• strategic and implementation consulting.

TriZetto is focused on three healthcare markets: payers, benefit administrators and physician groups. The company has nearly 500 customers representing approximately 40 percent of the U.S. insured population. Headquartered in Newport Beach, Calif., TriZetto can be reached at (949) 719-2200 or www.trizetto.com.

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CONTACTS:

Investor Relations
Anna Marie Dunlap
949-719-2236
am.dunlap@trizetto.com

Media Relations
Margie McCarthy
303-495-7225
margie.mccarthy@trizetto.com

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