USA Technologies, Inc. (NASDAQ:USAT), a premier payment
technology service provider of integrated cashless and mobile
transactions in the self-service retail market, today announced
preliminary estimated financial results for the fourth quarter and
fiscal year ended June 30, 2017.
The company’s financial closing procedures for the quarter and
fiscal year ended June 30, 2017 are not yet complete. Its
consolidated financial statements for the fiscal year ended June
30, 2017 are not yet available and the company’s independent
registered public accounting firm has not completed its audit of
the consolidated financial statements for such period. Set forth
below are certain estimates that the company expects to report for
the quarter and fiscal year ended June 30, 2017. The company’s
actual results may differ materially from these estimates.
The following are estimates for the quarter ended June 30,
2017:
- Revenues of between $32 million to $34
million, representing an increase of between 46% to 55% over
revenues for the fourth quarter ended June 30, 2016;
- Net income (loss) of between $(400,000)
to $400,000, representing an improvement of between 54% to 146%
over net loss for the fourth quarter ended June 30, 2016;
- Adjusted EBITDA of between $2.3 million
to $3.1 million, representing an increase of between 267% and 395%
over Adjusted EBITDA for the fourth quarter ended June 30, 2016;
and
- Net new connections of 64,000,
representing an increase of 129% over net new connections during
the company’s fiscal quarter ended June 30, 2016. The number of net
new connections added to the company’s service during the fiscal
fourth quarter ended June 30, 2017 reflected a significant order
received from an existing customer related to the customer’s
efforts to attain a 100% cashless presence in the marketplace.
The following are estimates for the fiscal year ended June 30,
2017:
- Revenues of between $102 million to
$104 million, representing an increase of between 32% to 34% over
revenues during the company’s fiscal year ended June 30, 2016;
- Net loss of between $(2.5) million to
$(1.7) million representing an improvement of between 63% to 75%
over net loss for the company’s fiscal year ended June 30,
2016;
- Adjusted EBITDA of between $6.5 million
to $7.3 million, representing an increase of between 9% and 22%
over Adjusted EBITDA for the fiscal year ended June 30, 2016;
and
- Net new connections of 139,000,
representing an increase of 45% over net new connections during the
company’s fiscal year ended June 30, 2016, reflecting the
significant order referred to above.
During the fiscal year ended June 30, 2017, the company
estimates that approximately 66% of its revenues consisted of
license and transaction fees and approximately 34% of its revenues
consisted of equipment sales.
During the fiscal year ended June 30, 2017, the dollar
transaction volume was approximately $800 million which is an
increase of approximately 37% over the dollar transaction volume
during the fiscal year ended June 30, 2016. Based upon the
company’s dollar transaction volume during the fourth fiscal
quarter ended June 30, 2017, the annualized dollar transaction
volume would be approximately $900 million, which is an increase of
approximately 32% over the company’s dollar transaction volume
during the fourth quarter ended June 30, 2016.
Adjusted EBITDA Description and Reconciliation
The company considers Adjusted EBITDA as net income (loss)
before interest income, interest expense, income taxes,
depreciation, amortization, non-recurring fees and charges that
were incurred in connection with the integration of the VendScreen
business, change in fair value of warrant liabilities and
stock-based compensation expense. The company has excluded the
non-operating item, change in fair value of warrant liabilities,
because it represents a non-cash gain or charge that is not related
to our operations. The company excluded the non-cash expense,
stock-based compensation, as it does not reflect the company’s
cash-based operations. The company has excluded the non-recurring
costs and expenses incurred in connection with the VendScreen
transaction in order to allow more accurate comparison of the
financial results to historical operations.
Adjusted EBITDA is a non-GAAP financial measure which is not
required by or defined under GAAP (Generally Accepted Accounting
Principles). The company uses these non-GAAP financial measures for
financial and operational decision-making purposes and as a means
to evaluate period-to-period comparisons. The company believes that
these non-GAAP financial measures provide useful information about
its operating results, enhance the overall understanding of past
financial performance and future prospects and allow for greater
transparency with respect to metrics used by management in its
financial and operational decision making. Adjusted EBITDA is
presented because the company believes it is useful to investors as
a measure of comparative operating performance. Additionally, the
company utilizes Adjusted EBITDA as a metric in its executive
officer and management incentive compensation plans.
The presentation of this financial measure is not intended to be
considered in isolation or as a substitute for the financial
measures prepared and presented in accordance with GAAP, including
the company’s net income or net loss or net cash used in operating
activities. Management recognizes that non-GAAP financial measures
have limitations in that they do not reflect all of the items
associated with the company’s net income or net loss as determined
in accordance with GAAP, and are not a substitute for or a measure
of the company’s profitability or net earnings.
The following table reconciles estimated preliminary Adjusted
EBITDA to estimated preliminary net income (loss) for the three
months and fiscal year ended June 30, 2017, and actual Adjusted
EBITDA to net income (loss) for the three months and fiscal year
ended June 30, 2016:
Three months ended
Twelve months ended
($ in thousands) 6/30/2017 6/30/2016
6/30/2017 6/30/2016 (Preliminary)
(Actual) (Preliminary) (Actual) Net income
(loss) $
(400) - 400
$ (872 ) $
(2,500) - (1,700)
$ (6,806 ) Less interest income (100 ) (182 ) (500 ) (320 ) Plus
interest expenses 300 197 900 600 Plus income tax provision / (Less
income tax benefit) 50 (703 ) 150 (615 ) Plus depreciation expense
1,850 1,272 5,400 5,135 Plus amortization expense 50
44 200 88 EBITDA
1,750 - 2,550 (244 ) 3,650 - 4,450
(1,918 ) Plus loss on fair value of warrant
liabilities / (Less gain on fair value of warrant liabilities) -
(18 ) 1,500 5,674 Plus stock-based compensation 550 198 1,200 849
Plus intangible asset impairment - 432 - 432 Plus VendScreen
non-recurring charges - 258 100 842 Plus Litigation related
professional fees - - 50
105 Adjustments to EBITDA 550
870 2,850 7,902 Adjusted EBITDA
$ 2,300 - 3,100 $ 626 $ 6,500 - 7,300 $ 5,984
About USA Technologies
USA Technologies, Inc. is a premier payment technology service
provider of integrated cashless and mobile transactions in the
self-service retail market. The company also provides a broad line
of cashless acceptance technologies including its NFC-ready ePort®
G-series, ePort® Connect, ePort® Interactive, QuickConnect, an API
Web service for developers, and MORE., a customizable loyalty
program. USA Technologies has 73 United States and foreign patents
in force; and has agreements with Verizon, Visa, Chase Paymentech
and customers such as Compass, AMI Entertainment and others. For
more information, please visit the website at www.usatech.com.
Forward-Looking Statements
USAT cautions you that statements in this press release that are
not a description of historical facts are forward-looking
statements. These statements are based on the company’s current
beliefs and expectations. The inclusion of forward-looking
statements should not be regarded as a representation by USAT that
any of our plans will be achieved. Actual results may differ from
those set forth in this press release due to conditions affecting
the capital markets, general economic, industry, or political
conditions, and other risks described in our prior press releases
and in our filings with the Securities and Exchange Commission,
including under the heading “Risk Factors” in our Annual Report on
Form 10-K. You are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date hereof,
and we undertake no obligation to revise or update this press
release to reflect events or circumstances after the date hereof.
All forward-looking statements are qualified in their entirety by
this cautionary statement, which is made under the safe harbor
provisions of the Private Securities Litigation Reform Act of
1995.
F-USAT
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Investor Contact:The Blueshirt GroupMike Bishop, +1
415-217-4968mike@blueshirtgroup.com
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