Cardtronics, Inc. (Nasdaq:CATM) (the "Company"), the world's
largest non-bank owner of ATMs, today announced its financial and
operational results for the quarter and year ended December 31,
2009.
-
Key financial and operational statistics related to the quarter
include:
-
Consolidated revenues of $124.8 million, up 6% from the fourth
quarter of 2008
-
Revenue growth of approximately 8% for the Company's core
business operations, which include the Company's domestic
company-owned large-account ATM placement and branding business and
the Company's international operations
-
Gross margins of 31%, up considerably from 24% in the fourth
quarter of 2008
-
Adjusted EBITDA of $27.6 million, up more than 44% from $19.1
million in the fourth quarter of 2008
-
Adjusted Net Income per Share of $0.17, up from $0.02 in the
fourth quarter of 2008
-
GAAP Net Income of $1.5 million compared to a $58.5 million GAAP
Net Loss in the fourth quarter of 2008
-
Free Cash Flow of nearly $18.0 million, consisting of $27.0
million of cash provided by operating activities, less $9.0 million
of capital expenditures, enabling the repayment of all amounts
previously outstanding under the Company's revolving credit
facility
-
Continued improvements in several key operating metrics when
compared to the fourth quarter of 2008:
-
Total cash withdrawal transactions and cash withdrawal
transactions per ATM per month increased by 8%
-
Total transactions per ATM per month increased by 10%
-
ATM operating gross profit per ATM per month increased by
43%
Please refer to the "Disclosure of Non-GAAP Financial
Information" contained later in this release for definitions of
Adjusted EBITDA, Adjusted Net Income, and Free Cash Flow. For
additional financial information, including reconciliations to
comparable GAAP measures, please refer to the supplemental
schedules of selected financial information at the end of this
release.
"2009 was truly an outstanding year for Cardtronics," commented
Fred Lummis, Cardtronics' Chairman of the Board. "Over this past
year, we took steps to strengthen and diversify the Company by
leveraging past investments, controlling our costs and maintaining
our high level of customer service. The results of these
efforts were record revenues and cash flows, which allowed us to
pay off our entire revolving loan balance in 2009 and reduce our
ratio of debt to Adjusted EBITDA from 4.2x at the end of 2008 to
2.8x at the end of 2009. Additionally, we continued to see
favorable transaction trends in all of our key markets, further
validating the earnings generation capabilities of our existing
network. With these positive factors and the recent hiring of
Steve Rathgaber as our new Chief Executive Officer, Cardtronics is
extremely well-positioned to not only continue these positive
trends, but to also expand its services and offerings in ways that
further leverage the Company's valuable network."
RECENT HIGHLIGHTS
-
The selection of Steven A. Rathgaber as the Company's new Chief
Executive Officer and member of the Company's Board of Directors,
effective February 1, 2010. Mr. Rathgaber, a seasoned payments
industry executive, brings over 32 years of broad payment product
and network experience to the Company.
-
The successful renewal of the Company's contract with CO-OP
Financial Services, under which the Company's ATMs located in
7-Eleven stores will continue to be a part of the CO-OP network
through July 2014. Each month, CO-OP members conduct more than
3.2 million surcharge-free transactions on Cardtronics ATMs in
7-Eleven stores.
-
The successful execution of two ATM managed services agreements
with Carnival Cruise Lines and the American Airlines Center, under
which Cardtronics will provide transaction processing and other
related ATM management services to such customers.
-
The planned expansion of the Company's United Kingdom in-house
armored car operation. As of December 31, 2009, this operation
was servicing approximately 780 of the Company's ATMs through its
London-based depot. The Company expects to open a second depot
based in Manchester during the second quarter of 2010, which will
allow the Company to service an additional 800 ATMs in the United
Kingdom.
-
Continued strong liquidity and access to capital, with over $170
million in available borrowing capacity under the Company's
revolving credit facility with leading financial institutions,
after taking into consideration outstanding letters of credit
FOURTH QUARTER RESULTS
For the fourth quarter of 2009, revenues totaled $124.8 million,
representing a 6% increase from the $118.2 million in revenues
generated during the fourth quarter of 2008. This increase
reflects 8% growth in the Company's core business operations, which
include the Company's higher-margin domestic large-account ATM
placement, branding and international businesses, offset somewhat
by a decline in the Company's lower-margin merchant-owned account
base and lower equipment sales, as merchants and financial
institutions continued to spend less capital in the current
economic environment. Although these declines negatively impacted
the year-over-year revenue comparison, the gross profit impact of
such declines was negligible as the Company's gross margins
increased to 31% for the fourth quarter of 2009 compared to 24% for
the same period in 2008. The significant increase in the
Company's core revenues was driven by continued strong cash
withdrawal transaction trends in all of the Company's operating
segments, coupled with increased bank branding and surcharge-free
network revenues in the United States. Furthermore, unlike the
previous quarters during 2009, the impact of foreign currency
exchange rate movements on the Company's comparative results for
the fourth quarter of 2009 was negligible.
Adjusted EBITDA totaled $27.6 million for the fourth quarter of
2009, compared to $19.1 million for the fourth quarter of 2008, and
Adjusted Net Income totaled $6.8 million ($0.17 per diluted share),
compared to Adjusted Net Income of $0.7 million ($0.02 per diluted
share) for the fourth quarter of 2008. These increases were
primarily attributable to significantly higher gross margins in
2009 when compared to 2008, driven by the increase in revenues, as
noted above, the continued shifting of revenues from lower-margin
surcharge revenues to higher-margin interchange and surcharge-free
network and bank branding revenues, and the Company's ability to
leverage its fixed cost infrastructure to generate strong margins
from those higher revenues. In particular, the Company
experienced noticeable declines in its maintenance and armored car
expenses during the most recent quarter, despite the significant
increase in revenues discussed above. Additionally, the Company's
vault cash rental costs were significantly lower in 2009 when
compared to 2008 due to lower overall market interest rates.
Specific costs excluded from Adjusted EBITDA and Adjusted Net
Income are detailed in a reconciliation included at the end of this
press release.
GAAP Net Income for the quarter totaled $1.5 million, compared
to a $58.5 million GAAP Net Loss during the same quarter in
2008. The 2008 net loss figure includes a non-cash charge
totaling $50 million related to the impairment of the Company's
goodwill associated with its United Kingdom operation as of
December 31, 2008.
FULL-YEAR RESULTS
Revenues totaled $493.4 million for the year ended December 31,
2009, which is comparable to the $493.0 million in revenues
recorded during the year ended December 31, 2008. However, on
a constant currency basis, which is defined in the "Disclosure of
Non-GAAP Financial Information" below, year-over-year revenues
increased by 4%. Although total revenues remained fairly constant
between the two years, approximately $18.1 million in revenues
shifted from surcharge revenue and equipment sales in 2008, to
interchange and surcharge-free network and bank branding
revenues in 2009. This shift was primarily due to the mix
shift from the Company's merchant-owned account base to its core
business operations, as noted above for the Company's quarterly
results.
Adjusted EBITDA totaled $110.4 million for the year ended
December 31, 2009, representing a 35% increase over the $81.9
million in Adjusted EBITDA for the same period in
2008. Adjusted Net Income totaled $26.5 million ($0.67 per
diluted share) for 2009, which was significantly higher than the
$7.6 million ($0.19 per diluted share) generated during 2008.
Increases in both Adjusted EBITDA and Adjusted Net Income were
primarily due to the same factors noted above for the Company's
quarterly results.
The Company recorded GAAP Net Income for the year ended December
31, 2009 of $5.3 million, compared to a GAAP Net Loss of $71.4
million during 2008. As previously mentioned, the 2008 net
loss figure includes a $50 million goodwill impairment charge
related to the Company's United Kingdom segment. Excluding this
goodwill impairment charge, the Company's year-over-year
improvement was primarily attributable to the factors identified
above in the discussion of Adjusted EBITDA and Adjusted Net
Income.
GUIDANCE
Below is the Company's financial guidance for the fiscal year
ending December 31, 2010:
-
Revenues of $520 million to $530 million;
-
Overall gross margins of approximately 30% to 30.5%;
-
Adjusted EBITDA of $118 million to $123 million;
-
Depreciation and accretion expense of $40 million to $41
million;
-
Cash interest expense of $29 million to $30 million;
-
Adjusted Net Income of $0.75 to $0.85 per diluted share, based
on approximately 41.5 million diluted shares outstanding; and
-
Capital expenditures of approximately $45 million, net of
noncontrolling interests.
The above guidance excludes the impact of certain one-time items
as well as $6 million to $6.5 million of anticipated stock-based
compensation expense and approximately $14 million to $15 million
of intangible asset amortization expense. Additionally, the above
guidance is based on estimated average foreign currency exchange
rates of $1.60 U.S. to 1.00 pound U.K. and $13.50 Mexican
pesos to $1.00 U.S.
LIQUIDITY
The Company continues to maintain a very strong liquidity
position. The Company's $175.0 million revolving credit
facility does not expire until May 2012 and is led by a syndicate
of leading banks. As of December 31, 2009, the Company had no
amounts outstanding under the facility and $4.7 million in letters
of credit posted under the facility, leaving $170.3 million in
available, committed funding. The Company is currently in
compliance with the covenants contained within this facility and
would continue to be in compliance even in the event of
substantially higher borrowings or substantially lower Adjusted
EBITDA amounts. The Company's remaining indebtedness includes
$0.2 million of capital leases in the United States, $9.8 million
of equipment loans in Mexico, and $297.2 million in senior
subordinated notes, net of discounts. The fixed rate senior
subordinated notes require no amortization prior to their August
2013 maturity date and contain no maintenance covenants and only
limited incurrence covenants under which the Company has
considerable flexibility.
The continued generation of pre-tax operating profits could
subject the Company to increased federal, state and local income
tax cash obligations in many of its jurisdictions. However,
the Company currently has in excess of $38 million of domestic
federal net operating loss carryforwards that can be utilized to
help offset such future cash tax obligations, subject to certain
restrictions and limitations.
DISCLOSURE OF NON-GAAP FINANCIAL INFORMATION
EBITDA, Adjusted EBITDA, Adjusted Net Income, Free Cash Flow,
and amounts provided on a constant currency basis are non-GAAP
financial measures provided as a complement to results prepared in
accordance with accounting principles generally accepted within the
United States of America and may not be comparable to similarly
titled measures reported by other companies. Management
believes that the presentation of these measures and the
identification of unusual, non-recurring, or non-cash items enhance
an investor's understanding of the underlying trends in the
Company's business and provide for better comparability between
periods in different years.
Adjusted EBITDA excludes depreciation, accretion, and
amortization expense as these amounts can vary substantially from
company to company within the Company's industry depending upon
accounting methods and book values of assets, capital structures
and the method by which the assets were acquired. Additionally,
Adjusted EBITDA and Adjusted Net Income exclude certain
non-recurring or non-cash items and therefore, may not be
comparable to similarly titled measures employed by other
companies. Free Cash Flow is cash provided by operating
activities less payments for capital expenditures. Amounts provided
on a constant currency basis are calculated by applying the foreign
exchange rate in effect for the applicable prior period to the
current year amounts denominated in the respective local
currencies. The non-GAAP financial measures presented herein
should not be considered in isolation or as a substitute for
operating income, net income, cash flows from operating, investing,
or financing activities, or other income or cash flow statement
data prepared in accordance with GAAP.
A reconciliation of Net Income (Loss) Attributable to
Controlling Interests to EBITDA, Adjusted EBITDA, and Adjusted Net
Income and a calculation of Free Cash Flow are presented in tabular
form at the end of this press release.
REVISION OF PRIOR PERIOD RESULTS
During the second quarter of 2009, the Company identified an
error related to certain capitalized costs associated with its
United Kingdom operations. Upon analysis of the Company's
fixed asset records, management identified certain assets,
primarily related to previously cancelled ATM sites, which should
have been expensed in prior periods. The impact of such error
was an overstatement of fixed assets and depreciation expense and
an understatement of cost of sales and loss on disposal of assets
for the years ended December 31, 2007 and 2008, including the
related quarterly periods contained therein. The cumulative impact
of such error on the statement of operations for the years affected
would have been a total additional expense of approximately $1.7
million. Management determined that the effects of the misstatement
were not material to any previously reported quarterly or annual
period; therefore, the related corrections are being made to the
applicable prior periods as such financial information is included
in future filings with the SEC. The Company's prior period
results reported herein have been revised to reflect these
adjustments, the effects of which have been summarized
below.
Statement of Operations:
|
Three Months Ended
December 31, 2008
|
Twelve Months Ended
December 31, 2008
|
|
As Reported
|
Adjustments
|
As Adjusted
|
As Reported
|
Adjustments
|
As Adjusted
|
|
(In thousands)
|
|
|
|
Cost of ATM operating revenues
|
$90,032
|
$205
|
$90,237
|
$ 377,527
|
$1,014
|
$378,541
|
Depreciation and accretion expense
|
10,245
|
(69)
|
10,176
|
39,414
|
(250)
|
39,164
|
Loss on disposal of assets(1)
|
1,834
|
80
|
1,914
|
5,284
|
523
|
5,807
|
Income tax expense
|
444
|
343
|
787
|
938
|
51
|
989
|
Net loss attributable to controlling interests and available to
common stockholders
|
(57,890)
|
(559)
|
(58,449)
|
(70,037)
|
(1,338)
|
(71,375)
|
|
|
|
|
|
|
|
(1)Previously included as a component of "Other
expense".
|
CONFERENCE CALL INFORMATION
The Company will host a conference call today, Thursday,
February 11, 2010, at 7:30 a.m. Central Time (8:30 a.m. Eastern
Time) to discuss its financial results for the quarter and year
ended December 31, 2009. To access the call, please call the
conference call operator at:
Dial
in:
(800) 946-0722
Alternate
dial-in:
(719) 457-2647
Please call in fifteen minutes prior to the scheduled start time
and request to be connected to the "Cardtronics Fourth Quarter
Earnings Call." Additionally, a live audio webcast of the
conference call will be available online through the investor
relations section of the Company's website at
http://www.cardtronics.com.
A digital replay of the conference call will be available
through Thursday, February 25, 2010, and can be accessed by calling
(888) 203-1112 or (719) 457-0820 and entering 4035703 for the
conference ID. A replay of the conference call will also be
available online through the Company's website subsequent to the
call through March 11, 2010.
ABOUT CARDTRONICS
Headquartered in Houston, Texas, Cardtronics is the world's
largest non-bank owner of ATMs. Cardtronics operates over 33,400
ATMs across its portfolio, with ATMs in every major market in the
United States and Puerto Rico, over 2,600 ATMs throughout the
United Kingdom, and over 2,600 ATMs throughout Mexico. Major
merchant clients include 7-Eleven®, Chevron®, Costco®,
CVS®/pharmacy, ExxonMobil®, Rite Aid®, Safeway®, Sunoco®, Target®,
and Walgreens®. Complementing its ATM operations, Cardtronics
works with financial institutions of all sizes to provide their
customers with convenient cash access and deposit capabilities
through ATM branding, surcharge-free programs, and image deposit
services. Approximately 11,100 Cardtronics owned and operated
ATMs currently feature bank brands. For more information,
please visit the Company's website at
http://www.cardtronics.com.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. Forward-looking statements give our current expectations
or forecasts of future events, future financial performance,
strategies, expectations, competitive environment, regulation, and
availability of resources. Many of the forward-looking
statements contained in this release relate to our fourth quarter
financial results and the underlying business events which
generated those results. They include, among other things,
statements concerning projections, predictions, expectations,
estimates or forecasts as to our business, financial and
operational results and future economic performance, and statements
of management's goals and objectives and other similar expressions
concerning matters that are not historical facts. Such
statements are subject to risks and uncertainties that could cause
actual performance or results to differ materially from those
expressed in or suggested by the forward-looking
statements. Such risks and uncertainties include, but are not
limited to, the following:
-
our financial outlook and the financial outlook of the ATM
industry;
-
our ability to cope with and develop business strategies dealing
with the deterioration experienced in global credit markets;
-
our ability to provide new ATM solutions to financial
institutions;
-
our ATM vault cash rental needs, including liquidity issues with
our vault cash providers;
-
the implementation of our corporate strategy;
-
our ability to compete successfully with our competitors;
-
our financial performance;
-
our ability to strengthen existing customer relationships and
reach new customers;
-
our ability to meet the service levels required by our service
level agreements with our customers;
-
our ability to pursue and successfully integrate
acquisitions;
-
our ability to expand internationally;
-
our ability to prevent security breaches;
-
changes in interest rates, foreign currency rates and regulatory
requirements; and
-
the additional risks we are exposed to in our armored transport
business.
Other factors that could cause our actual performance or results
to differ from our projected results are described in our filings
with the SEC, including our Annual Report on Form 10-K, Quarterly
Reports on Form 10-Q and Current Reports on Form 8-K. You should
not read forward-looking statements as a guarantee of future
performance or results. They will not necessarily be accurate
indications of the times at or by which such performance or results
will be achieved. Forward-looking statements speak only as of
the date the statements are made and are based on information
available at the time those statements are made and/or management's
good faith belief as of that time with respect to future
events. We assume no obligation to update forward-looking
statements to reflect actual results, changes in assumptions or
changes in other factors affecting forward-looking information.
The Cardtronics logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=991
Consolidated Statements of Operations
|
For the Three and Twelve Months Ended December 31, 2009
and 2008
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
December 31,
|
Twelve Months Ended
December 31,
|
|
2009
|
2008
|
2009
|
2008
|
|
(In thousands, except share and per share
information)
|
Revenues:
|
|
|
|
|
ATM operating revenues
|
$122,002
|
$114,027
|
$483,138
|
$475,800
|
ATM product sales and other revenues
|
2,755
|
4,178
|
10,215
|
17,214
|
Total revenues
|
124,757
|
118,205
|
493,353
|
493,014
|
Cost of revenues:
|
|
|
|
|
Cost of ATM operating revenues (exclusive of depreciation,
accretion, and amortization shown separately below)
|
82,620
|
86,502
|
333,907
|
362,916
|
Cost of ATM product sales and other revenues
|
2,922
|
3,735
|
10,567
|
15,625
|
Total cost of revenues
|
85,542
|
90,237
|
344,474
|
378,541
|
Gross profit
|
39,215
|
27,968
|
148,879
|
114,473
|
Operating expenses:
|
|
|
|
|
Selling, general, and administrative expenses (1)
|
10,878
|
10,330
|
41,527
|
39,068
|
Depreciation and accretion expense
|
9,860
|
10,176
|
39,420
|
39,164
|
Amortization expense
|
5,480
|
4,888
|
18,916
|
18,549
|
Loss on disposal of assets
|
1,185
|
1,914
|
6,016
|
5,807
|
Goodwill impairment
|
—
|
50,003
|
—
|
50,003
|
Total operating expenses
|
27,403
|
77,311
|
105,879
|
152,591
|
Income (loss) from operations
|
11,812
|
(49,343)
|
43,000
|
(38,118)
|
Other expense:
|
|
|
|
|
Interest expense, net
|
7,305
|
7,823
|
30,133
|
31,090
|
Amortization of deferred financing costs and bond discounts
|
618
|
538
|
2,395
|
2,107
|
Other expense
|
1,244
|
166
|
456
|
93
|
Total other expense
|
9,167
|
8,527
|
32,984
|
33,290
|
|
|
|
|
|
Income (loss) before income taxes
|
2,645
|
(57,870)
|
10,016
|
(71,408)
|
Income tax expense
|
961
|
787
|
4,245
|
989
|
Net income (loss)
|
1,684
|
(58,657)
|
5,771
|
(72,397)
|
Net income (loss) attributable to noncontrolling interests
|
225
|
(208)
|
494
|
(1,022)
|
Net income (loss) attributable to controlling interests and
available to common shareholders
|
$1,459
|
($58,449)
|
$5,277
|
($71,375)
|
|
|
|
|
|
Net income (loss) per common share – basic
|
$0.04
|
($1.50)
|
$0.13
|
($1.84)
|
Net income (loss) per common share – diluted
|
$0.03
|
($1.50)
|
$0.13
|
($1.84)
|
|
|
|
|
|
Weighted average shares outstanding – basic
|
39,600,166
|
38,957,820
|
39,244,057
|
38,800,782
|
Weighted average shares outstanding – diluted
|
40,910,286
|
38,957,820
|
39,896,366
|
38,800,782
|
_____________________
|
|
|
|
|
(1) Selling, general, and administrative expenses for
the twelve months ended December 31, 2009 includes $1.2 million in
severance costs associated with the departure of the Company's
former Chief Executive Officer in March 2009 and $0.9 million of
additional stock-based compensation expense compared to the twelve
months ended December 31, 2008.
|
Consolidated Balance Sheets
|
As of December 31, 2009 and December 31,
2008
|
(Unaudited)
|
|
|
|
|
December 31, 2009
|
December 31, 2008
|
|
(In thousands)
|
Assets
|
|
|
Current assets:
|
|
|
Cash and cash equivalents
|
$10,449
|
$3,424
|
Accounts and notes receivable, net
|
27,700
|
25,317
|
Inventory
|
2,617
|
3,011
|
Restricted cash, short-term
|
3,452
|
2,423
|
Prepaid expenses, deferred costs, and other current assets
|
8,850
|
17,273
|
Total current assets
|
53,068
|
51,448
|
Property and equipment, net
|
147,348
|
153,430
|
Intangible assets, net
|
89,036
|
108,327
|
Goodwill
|
165,166
|
163,784
|
Prepaid expenses, deferred costs, and other assets
|
5,786
|
3,839
|
Total assets
|
$460,404
|
$480,828
|
|
|
|
Liabilities and Stockholders' Deficit
|
|
|
Current liabilities:
|
|
|
Current portion of long-term debt and notes payable
|
$2,122
|
$1,373
|
Current portion of capital lease obligations
|
235
|
757
|
Current portion of other long-term liabilities
|
26,047
|
24,302
|
Accounts payable and other accrued and current liabilities
|
72,000
|
72,386
|
Total current liabilities
|
100,404
|
98,818
|
Long-term liabilities:
|
|
|
Long-term debt, net of related discounts
|
304,930
|
344,816
|
Capital lease obligations
|
—
|
235
|
Deferred tax liability, net
|
13,858
|
11,673
|
Asset retirement obligations
|
24,003
|
21,069
|
Other long-term liabilities
|
18,499
|
23,967
|
Total liabilities
|
461,694
|
500,578
|
Stockholders' deficit
|
(1,290)
|
(19,750)
|
Total liabilities and stockholders' deficit
|
$460,404
|
$480,828
|
SELECTED INCOME STATEMENT DETAIL:
|
|
|
|
|
|
|
|
Total revenues by segment:
|
|
Three Months Ended
December 31,
|
Twelve Months Ended
December 31,
|
|
2009
|
2008
|
2009
|
2008
|
|
(In thousands)
|
United States
|
$98,878
|
$97,828
|
$401,934
|
$404,716
|
United Kingdom
|
20,302
|
16,682
|
73,096
|
74,155
|
Mexico
|
5,577
|
3,695
|
18,323
|
14,143
|
Total revenues
|
$124,757
|
$118,205
|
$493,353
|
$493,014
|
|
|
|
|
|
Breakout of ATM operating revenues:
|
|
Three Months Ended
December 31,
|
Twelve Months Ended
December 31,
|
|
2009
|
2008
|
2009
|
2008
|
|
(In thousands)
|
Surcharge revenues
|
$62,163
|
$62,582
|
$254,503
|
$266,326
|
Interchange revenues
|
39,055
|
34,081
|
149,908
|
141,865
|
Bank branding and surcharge-free network revenues
|
17,908
|
15,365
|
67,873
|
58,313
|
Other revenues
|
2,876
|
1,999
|
10,854
|
9,296
|
Total ATM operating revenues
|
$122,002
|
$114,027
|
$483,138
|
$475,800
|
|
|
|
|
|
Total cost of revenues by segment:
|
|
|
|
Three Months Ended
December 31,
|
Twelve Months Ended
December 31,
|
|
2009
|
2008
|
2009
|
2008
|
|
(In thousands)
|
United States
|
$67,125
|
$71,742
|
$279,582
|
$302,152
|
United Kingdom
|
14,456
|
15,428
|
51,419
|
64,566
|
Mexico
|
3,961
|
3,067
|
13,473
|
11,823
|
Total cost of revenues
|
$85,542
|
$90,237
|
$344,474
|
$378,541
|
|
|
|
|
|
Breakout of Cost of ATM operating revenues (exclusive of
depreciation, accretion, and amortization):
|
|
|
|
|
|
|
Three Months Ended
December 31,
|
Twelve Months Ended
December 31,
|
|
2009
|
2008
|
2009
|
2008
|
|
(In thousands)
|
Merchant commissions
|
$38,874
|
$38,760
|
$156,936
|
$164,538
|
Vault cash rental expense
|
8,764
|
10,546
|
33,950
|
46,780
|
Other cost of cash
|
10,618
|
12,355
|
43,599
|
47,343
|
Repairs and maintenance
|
9,197
|
10,217
|
38,740
|
38,291
|
Communications
|
3,675
|
3,998
|
14,876
|
17,024
|
Transaction processing
|
1,512
|
1,575
|
6,431
|
8,269
|
Stock-based compensation
|
208
|
197
|
798
|
621
|
Other expenses
|
9,772
|
8,854
|
38,577
|
40,050
|
Total cost of ATM operating revenues
|
$82,620
|
$86,502
|
$333,907
|
$362,916
|
|
|
|
|
|
Breakout of Selling, general, and administrative
expenses:
|
|
|
|
|
|
|
|
Three Months Ended
December 31,
|
Twelve Months Ended
December 31,
|
|
2009
|
2008
|
2009
|
2008
|
|
(In thousands)
|
Employee costs
|
$6,096
|
$4,526
|
$23,535
|
$18,671
|
Stock-based compensation
|
1,036
|
1,152
|
3,822
|
2,895
|
Professional fees
|
1,099
|
2,051
|
4,674
|
7,057
|
Other
|
2,647
|
2,601
|
9,496
|
10,445
|
Total selling, general, and administrative expenses
|
$10,878
|
$10,330
|
$41,527
|
$39,068
|
|
|
|
|
|
SELECTED BALANCE SHEET DETAIL:
|
|
|
|
|
|
|
|
Long-term debt and capital lease
obligations:
|
|
|
|
December 31, 2009
|
December 31, 2008
|
|
|
|
(In thousands)
|
|
|
Series A and Series B senior subordinated notes, net of
discounts
|
$297,242
|
$296,637
|
|
|
Revolving credit facility
|
—
|
43,500
|
|
|
Equipment financing lines of Mexico subsidiary
|
9,810
|
6,052
|
|
|
Capital lease obligations
|
235
|
992
|
|
|
Total long-term debt and capital lease obligations
|
$307,287
|
$347,181
|
|
|
|
|
|
|
|
Share count rollforward:
|
|
|
|
|
|
|
|
Total shares outstanding as of December 31, 2008
|
40,636,533
|
|
|
|
Shares repurchased
|
(121,747)
|
|
|
|
Shares issued – restricted stock grants and stock option
exercises
|
595,746
|
|
|
|
Shares forfeited – restricted stock
|
(210,000)
|
|
|
|
Total shares outstanding as of December 31, 2009
|
40,900,532
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SELECTED CASH FLOW DETAIL:
|
|
|
|
|
|
|
|
Selected cash flow statement amounts:
|
|
Three Months Ended
December 31,
|
Twelve Months Ended
December 31,
|
|
2009
|
2008
|
2009
|
2008
|
|
(In thousands)
|
Cash provided by operating activities
|
$26,991
|
$5,254
|
$75,982
|
$16,218
|
Cash used in investing activities
|
(6,957)
|
(6,472)
|
(27,122)
|
(60,476)
|
Cash provided by (used in) financing activities
|
(15,666)
|
3,444
|
(42,232)
|
34,507
|
Effect of exchange rate changes on cash
|
(60)
|
(7)
|
397
|
(264)
|
Net increase (decrease) in cash and cash equivalents
|
$4,308
|
$2,219
|
$7,025
|
($10,015)
|
Cash and cash equivalents at beginning of period
|
6,141
|
1,205
|
3,424
|
13,439
|
Cash and cash equivalents at end of period
|
$10,449
|
$3,424
|
$10,449
|
$3,424
|
Key Operating Metrics
|
For the Three and Twelve Months Ended December 31, 2009
and 2008
|
(Unaudited)
|
|
|
|
|
Three Months Ended
December 31,
|
Twelve Months Ended
December 31,
|
|
2009
|
2008
|
2009
|
2008
|
Average number of transacting ATMs:
|
|
|
|
|
United States: Company-owned
|
18,181
|
18,075
|
18,190
|
17,993
|
United States: Merchant-owned
|
9,938
|
10,392
|
10,066
|
10,695
|
United Kingdom
|
2,687
|
2,527
|
2,606
|
2,421
|
Mexico
|
2,359
|
2,070
|
2,197
|
1,747
|
Total average number of transacting ATMs
|
33,165
|
33,064
|
33,059
|
32,856
|
|
|
|
|
|
Total transactions (in thousands)
|
97,681
|
88,480
|
383,323
|
354,391
|
Total cash withdrawal transactions (in thousands)
|
61,209
|
56,612
|
244,378
|
228,306
|
Monthly cash withdrawal transactions per ATM
|
615
|
571
|
616
|
579
|
|
|
|
|
|
Per ATM per month amounts:
|
|
|
|
|
ATM operating revenues (1)
|
$1,226
|
$1,150
|
$1,218
|
$1,207
|
Cost of ATM operating revenues (2)
|
830
|
873
|
842
|
921
|
ATM operating gross profit (3)
|
$396
|
$277
|
$376
|
$286
|
|
|
|
|
|
ATM operating gross margin (2)
|
32.3%
|
24.1%
|
30.9%
|
23.7%
|
|
|
|
|
|
Capital expenditures (in thousands) (4)
|
$9,013
|
$6,465
|
$29,621
|
$60,136
|
Capital expenditures, net of noncontrolling interest (in
thousands) (4)
|
$7,495
|
$6,403
|
$26,891
|
$57,944
|
___________________
|
|
|
|
|
(1) ATM operating revenues per ATM per month were
negatively affected by foreign currency exchange rate movements
between the twelve month periods ended December 31, 2009 and
2008.
|
(2) Amounts presented exclude the effects of
depreciation, accretion, and amortization expense, which are
presented separately in the Company's consolidated statements of
operations.
|
(3) ATM operating gross profit is a measure of
profitability that uses only the revenues and expenses that relate
to operating ATMs in the Company's portfolio. Revenues and expenses
from ATM equipment sales and other ATM-related services are not
included.
|
(4) Capital expenditures include amounts financed by
direct debt for the three and twelve month periods ended December
31, 2009.
|
Reconciliation of Net Income (Loss) Attributable to
Controlling Interest to EBITDA, Adjusted EBITDA, and
Adjusted Net Income
|
For the Three and Twelve Months Ended December 31, 2009
and 2008
|
(Unaudited)
|
|
|
|
|
|
|
Three Months Ended
December 31,
|
Twelve Months Ended
December 31,
|
|
2009
|
2008
|
2009
|
2008
|
|
(In thousands, except share and per share amounts)
|
Net income (loss) attributable to controlling
interests
|
$1,459
|
$(58,449)
|
$5,277
|
$(71,375)
|
Adjustments:
|
|
|
|
|
Interest expense, net
|
7,305
|
7,823
|
30,133
|
31,090
|
Amortization of deferred financing costs and bond discounts
|
618
|
538
|
2,395
|
2,107
|
Income tax expense
|
961
|
787
|
4,245
|
989
|
Depreciation and accretion expense
|
9,860
|
10,176
|
39,420
|
39,164
|
Amortization expense
|
5,480
|
4,888
|
18,916
|
18,549
|
Goodwill impairment
|
—
|
50,003
|
—
|
50,003
|
EBITDA
|
$25,683
|
$15,766
|
$100,386
|
$70,527
|
|
|
|
|
|
Add back:
|
|
|
|
|
Loss on disposal of assets (1)
|
1,185
|
1,914
|
6,016
|
5,807
|
Other (income) expense (2)
|
(194)
|
166
|
(982)
|
93
|
Noncontrolling interests
|
(334)
|
(404)
|
(1,281)
|
(1,633)
|
Stock-based compensation expense
|
1,243
|
1,349
|
4,620
|
3,516
|
Other adjustments to cost of ATM operating revenues
(3)
|
1
|
(115)
|
154
|
2,911
|
Other adjustments to selling, general, and administrative
expenses (4)
|
—
|
426
|
1,463
|
718
|
Adjusted EBITDA
|
$27,584
|
$19,102
|
$110,376
|
$81,939
|
Less:
|
|
|
|
|
Interest expense, net
|
7,305
|
7,823
|
30,133
|
31,090
|
Depreciation and accretion expense
|
9,860
|
10,176
|
39,420
|
39,164
|
Income tax expense (at 35%)
|
3,646
|
385
|
14,288
|
4,089
|
Adjusted Net Income
|
$6,773
|
$718
|
$26,535
|
$7,596
|
|
|
|
|
|
Adjusted Net Income per share
|
$0.17
|
$0.02
|
$0.68
|
$0.20
|
Adjusted Net Income per diluted share
|
$0.17
|
$0.02
|
$0.67
|
$0.19
|
|
|
|
|
|
Weighted average shares outstanding – basic
|
39,600,166
|
38,957,820
|
39,244,057
|
38,800,782
|
Weighted average shares outstanding – diluted
|
40,910,286
|
39,609,994
|
39,896,366
|
39,801,492
|
|
|
|
|
|
(1) Primarily comprised of losses on the disposal of
fixed assets that were incurred with the deinstallation of ATMs
during the periods.
|
(2) The three and twelve month periods ended December
31, 2009 exclude approximately $1.4 million of unrealized losses
related to certain interest rate swaps. Such losses reduced the
Company's reported EBITDA and Adjusted EBITDA amounts for both
periods.
|
(3) Primarily consisted of costs associated with the
continued conversion of ATMs in the Company's portfolio over to its
in-house EFT processing platform and development costs associated
with the start-up of the Company's in-house armored operation in
the United Kingdom.
|
(4) For the twelve month period ended December 31,
2009, other adjustments to selling, general, and administrative
expenses primarily consisted of severance costs associated with
departure of the Company's former Chief Executive Officer in March
2009
|
Reconciliation of Free Cash Flow
|
For the Three and Twelve Months Ended December 31, 2009
and 2008
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Three Months Ended
December 31,
|
Twelve Months Ended
December 31,
|
|
2009
|
2008
|
2009
|
2008
|
|
(In thousands)
|
Cash provided by operating activities
|
$26,991
|
$5,254
|
$75,982
|
$16,218
|
Payments for capital expenditures(1)
|
9,013
|
6,465
|
29,621
|
60,136
|
Free cash flow
|
$17,978
|
$(1,211)
|
$46,361
|
$(43,918)
|
|
|
|
|
|
(1) Capital expenditures exclude acquisitions and
include payments made for exclusive license agreements, site
acquisition costs, and capital expenditures financed by direct
debt.
|
Reconciliation of Estimated Net Income to EBITDA,
Adjusted EBITDA, and Adjusted Net Income
|
For the Year Ending December 31, 2010
|
(Unaudited)
|
|
|
|
|
|
|
(In millions, except per share amounts)
|
Estimated Range
Full Year 2010
|
|
|
|
|
Net income
|
$15.5
|
--
|
$20.3
|
Adjustments:
|
|
|
|
Interest expense, net
|
30.0
|
--
|
29.0
|
Amortization of deferred financing costs and bond discounts
|
2.6
|
--
|
2.6
|
Income tax expense
|
9.4
|
--
|
13.1
|
Depreciation and accretion expense
|
41.0
|
--
|
40.0
|
Amortization expense
|
15.0
|
--
|
14.0
|
EBITDA
|
$113.5
|
--
|
$119.0
|
|
|
|
|
Add back:
|
|
|
|
Noncontrolling interests
|
(2.0)
|
--
|
(2.0)
|
Stock-based compensation expense
|
6.5
|
--
|
6.0
|
Adjusted EBITDA
|
$118.0
|
--
|
$123.0
|
Less:
|
|
|
|
Interest expense, net
|
30.0
|
--
|
29.0
|
Depreciation and accretion expense
|
41.0
|
--
|
40.0
|
Income tax expense (at 35%)
|
16.4
|
--
|
18.5
|
Adjusted Net Income
|
$30.6
|
--
|
$35.5
|
|
|
|
|
Adjusted Net Income per diluted share
|
$0.75
|
--
|
$0.85
|
|
|
|
|
Weighted average shares outstanding – diluted
|
41.0
|
--
|
42.0
|
CONTACT: Cardtronics, Inc.
Investors:
Chris Brewster, Chief Financial Officer
832-308-4128
cbrewster@cardtronics.com
Media:
Joel Antonini, Vice President -- Marketing
832-308-4131
joel.antonini@cardtronics.com
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