Cardtronics plc (Nasdaq: CATM) (“Cardtronics” or the “Company”),
the world’s largest ATM owner/operator, announced today its
financial and operational results for the quarter and year ended
December 31, 2019.
“We continued to deliver on our strategic
priorities during the fourth quarter, resulting in solid revenue
growth and a strong performance on our key profitability metrics.
During 2019, we returned to organic revenue growth, expanded
margins, strengthened our network and invested for the future,
while delivering record adjusted free cash flows. We have momentum
exiting 2019 behind the catalyst of continued transformation in
banking and consumer financial services. We are excited about our
continued roll-out of our deposit and cash accepting ATMs, coupled
with advanced software at the ATM and mobile capabilities. These
investments will enable new products and partnerships. Looking into
2020 and beyond, we are well-positioned to deliver revenue and
profit growth by leveraging our unique network and continuing to
evolve the business to deliver expanded solutions for our
customers,” commented Edward H. West, Cardtronics’ chief executive
officer.
Fourth Quarter 2019 Financial
Highlights:
- Total revenues of $338.8 million, up 3% from $327.9 million in
the prior year, and up 4% on a constant-currency basis.
- ATM operating revenues of $322.0 million, up 3% from $314.1
million in the prior year and also up 3% on a constant-currency
basis.
- GAAP Net Income of $12.6 million, or $0.28 per diluted share,
compared to Net Loss of $6.1 million, or $0.13 per diluted share in
the prior year.
- Adjusted Net Income per diluted share of $0.70, up 49% from the
prior year.
- Adjusted EBITDA of $78.1 million, up 14% from $68.5 million in
the prior year, and up 15% on a constant- currency basis.
- Adjusted EBITDA margin of 23.1%, up 220 basis points from the
prior year.
Recent Business Highlights:
- Implemented a new program with Amazon to enable customers to
add cash to their Amazon Balance with Amazon Cash at cash-accepting
Cardtronics ATMs.
- Renewal and expansion of ATM placement agreement with
Couche-Tard for approximately 5,500 ATMs.
- New ATM placement agreement for 130 ATMs with Golub
Corporation, owner of grocery chain, Price Chopper.
- Recently executed managed services agreement with BankUnited to
provide full ATM services for nearly 80 ATMs in Florida and New
York. BankUnited has also joined the Allpoint Network.
- Growing partnerships with leading fintech and challenger banks
added to the Allpoint Network, including Axos, Branch, Cogni,
Current, Majority, Rellevate, and Revolut.
Full-Year 2019 Financial
Highlights:
- Total revenues of $1.35 billion, up 0.3% compared to the prior
year, and up 2.5% on a constant-currency basis.
- ATM operating revenues of $1.28 billion, down 0.9% from $1.29
billion in the prior year and up 1.4% on a constant-currency
basis.
- GAAP net income of $48.3 million, or $1.05 per diluted share,
compared to GAAP net income of $3.7 million, or $0.08 per diluted
share in the prior year.
- Adjusted net income per diluted share of $2.52 compared to
$2.14 in the prior year.
- Adjusted EBITDA of $308.0 million, up 5.2% from $292.7 million
in the prior year.
- Adjusted EBITDA margin of 22.8%, up 100 basis points from the
prior year.
- Cash flow provided by operations of $204.7 million compared to
Cash flow provided by operations of $334.2 million in the prior
year, with the significant change being driven by the timing of
settlements and the resulting fluctuations in restricted cash and
corresponding liabilities.
- Adjusted free cash flow of $150.2 million, up $32.3 million
from $117.9 million in the prior year; paid down outstanding debt
by $96 million.
- Repurchased approximately 1.7 million shares or nearly 4% of
shares outstanding.
See Disclosure of Non-GAAP Financial Information
in this earnings release for definitions of Adjusted Gross Profit,
Adjusted Gross Margin, EBITDA, Adjusted EBITDA, Adjusted EBITDA
margin, Adjusted Net Income, Adjusted Net Income per diluted share
(may also be referred to by the Company as "Adjusted EPS"),
Adjusted Free Cash Flow, and certain other financial measures
recognized under generally accepted accounting principles in the
U.S. (“U.S. GAAP” or “GAAP”) and other non-GAAP measures that are
used by management on a constant-currency basis. For additional
information, including reconciliations to the most directly
comparable GAAP measure, see the supplemental schedules of selected
financial information in this earnings release.
The Company may also refer to revenue or profit
growth as being organic. When providing growth measures on an
organic basis, the Company aims to exclude the estimated impact
from any acquired or divested businesses that may be included or
partially included in one period but not another. The Company may
further adjust organic performance measures for the impacts of
currency movements, in order to have a consistent performance
comparison across periods for the business, excluding movements in
exchange rates.
2020 Full-Year Outlook
Below is the Company’s financial outlook for the
year ending December 31, 2020:
- Revenues of $1.37 billion to $1.40 billion;
- GAAP net income of $52 million to $56 million;
- Adjusted EBITDA of $325 million to $335 million;
- Depreciation and accretion expense of $140 million to $142
million;
- Cash interest expense of $24 million to $26 million;
- Adjusted net income of $119 million to $124 million;
- Adjusted net income per diluted share of $2.58 to $2.70 based
on approximately 46.0 million average diluted shares outstanding;
and
- Capital expenditures of approximately $140 million.
The Adjusted EBITDA and Adjusted Net Income
outlook excludes the impact of certain expenses, as outlined in the
reconciliation provided at the end of this earnings release. See
Disclosure of Non-GAAP Financial Information in this earnings
release for definitions of these Non-GAAP measures. This outlook is
based on average foreign currency exchange rates for 2020 of £1.00
U.K. to $1.30 U.S., $19.25 Mexican pesos to $1.00 U.S.,
$1.00 Canadian dollar to $0.75 U.S., €1.00 Euros to $1.12
U.S., $1.00 Australian dollar to $0.70 U.S., and R14.50 South
African Rand to $1.00 U.S.
CONFERENCE CALL INFORMATION
The Company will host a conference call today,
Thursday, February 20, 2020, at 4:00 p.m. Central Time (5:00
p.m. Eastern Time) to discuss its financial results for the quarter
ended December 31, 2019. To access the call, please call the
conference call operator at:
Dial-in: |
(877) 303-9205 |
Alternate dial-in: |
(760) 536-5226 |
Please call in 15 minutes prior to the scheduled
start time and request to be connected to the “Cardtronics Fourth
Quarter 2019 Earnings Conference 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
www.cardtronics.com.
A digital replay of the conference call will be
available through February 27, 2020, and can be accessed by calling
(855) 859-2056 or (404) 537-3406 and entering 9566016 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 27, 2020. Prior to the conference call, the
Company will post supplemental financial information to its website
at www.cardtronics.com.
ABOUT CARDTRONICS (Nasdaq:
CATM)
Cardtronics is the trusted leader in financial
self-service, enabling cash transactions at approximately 285,000
ATMs across 10 countries in North America, Europe, Asia-Pacific,
and Africa. Leveraging our unmatched scale, expertise and
innovation, top-tier merchants and businesses of all sizes use our
ATM solutions to drive growth, in-store traffic, and retail
transactions. Financial services providers rely on Cardtronics to
deliver superior service at their own ATMs, on Cardtronics ATMs
where they place their brand, and through Cardtronics' Allpoint
Network, the world’s largest surcharge-free ATM network, with over
58,000 locations. As champions of cash, Cardtronics converts
digital currency into physical cash, driving payments choice for
businesses and consumers alike.
CONTACT INFORMATION
EVP -
TreasurerBrad Conrad832-308-4000ir@cardtronics.com |
VP - Public
Relations & CommunicationsLisa
Albiston832-308-4000corporatecommunications@cardtronics.com |
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING
STATEMENTS
This earnings release contains “forward-looking
statements” within the meaning of the Private Securities Litigation
Reform Act of 1995, as amended and are intended to be covered by
the safe harbor provisions thereof. These forward-looking
statements are based on management’s current expectations and
beliefs concerning future developments and their potential effect
on the Company and there can be no assurance that future
developments affecting the Company will be those that are
anticipated. All comments concerning the Company’s expectations for
future revenues and operating results are based on its estimates
for its existing operations and do not include the potential impact
of any future acquisitions. The Company’s forward-looking
statements involve significant risks and uncertainties (some of
which are beyond its control) and assumptions that could cause
actual results to differ materially from its historical experience
and present expectations or projections. Risk factors are described
in the Company’s Annual Report on Form 10-K for the fiscal year
ended December 31, 2019, and those set forth from time-to-time
in other filings with the Securities and Exchange Commission.
Readers are cautioned not to place undue reliance on
forward-looking statements contained in this earnings release,
which speak only as of the date of this earnings release. Except as
required by applicable law, the Company undertakes no obligation to
publicly update or revise any forward-looking statements after the
date they are made, whether as a result of new information, future
events, or otherwise.
DISCLOSURE OF NON-GAAP FINANCIAL
INFORMATION
In order to assist readers of our consolidated
financial statements in understanding the operating results that
management uses to evaluate the business and for financial planning
purposes, the Company presents the following non-GAAP measures as a
complement to financial results prepared in accordance with U.S.
GAAP: Adjusted Gross Profit, Adjusted Gross Margin, EBITDA,
Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net Income,
Adjusted Tax Rate, Adjusted Net Income per diluted share, Adjusted
Free Cash Flow, and certain other results presented on a
constant-currency basis. Management believes that the
presentation of these measures and the identification of notable,
non-cash, non-operating costs, and/or (if applicable in a
particular period) certain costs not anticipated to occur in future
periods enhance an investor’s understanding of the underlying
trends in the Company’s business and provide for better
comparability between periods in different years. Management
also believes that these measures are relevant and provide useful
information widely used by analysts, investors and other interested
parties in the Company’s industry to provide a baseline for
evaluating and comparing our operating performance and, in the case
of free cash flow, our liquidity results. Management uses these
non-GAAP financial measures in managing and measuring the
performance of the business, including setting and measuring
incentive-based compensation.
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 measures
prepared in accordance with GAAP. Reconciliations of the non-GAAP
financial measures used herein to the most directly comparable GAAP
financial measures are presented in tabular form at the end of this
earnings release. In addition, the non-GAAP measures that are
used by the Company are not defined in the same manner by all
companies and therefore may not be comparable to other similarly
titled measures of other companies.
Adjusted Gross Profit and Adjusted Gross
Margin
Adjusted Gross Profit represents total revenues
less the total cost of revenues, excluding depreciation, accretion,
and amortization of intangible assets. Adjusted Gross Margin is
calculated by dividing Adjusted Gross Profit by total revenues.
EBITDA, Adjusted EBITDA and Adjusted
EBITDA Margin
EBITDA adds interest, income tax expense
(benefit), depreciation and accretion, amortization of deferred
financing costs and note discounts, amortization of intangible
assets, and certain costs not anticipated to occur in future
periods to net income. Adjusted EBITDA and Adjusted EBITDA Margin
exclude the items excluded from EBITDA as well as share-based
compensation expense, certain other income and expense amounts,
acquisition related expenses, gains or losses on disposal and
impairment of assets, certain non-operating expenses, (if
applicable in a particular period), our obligation for the payment
of income taxes, interest expense and other obligations such as
capital expenditures, and includes an adjustment for noncontrolling
interests. Depreciation and accretion expense and amortization of
intangible assets are excluded from Adjusted EBITDA and Adjusted
EBITDA margins as these amounts can vary substantially from company
to company within our industry depending upon accounting methods
and book values of assets, capital structures, and the methods by
which the assets were acquired. Adjusted EBITDA margin is
calculated as Adjusted EBITDA divided by total revenues.
Adjusted Net Income, Adjusted Net Income
per Diluted Share and Adjusted Tax Rate
Adjusted Net Income represents net income
computed in accordance with GAAP, before amortization of intangible
assets, deferred financing costs and note discount, gains or losses
on disposal and impairment of assets, share-based compensation
expense, certain other income and expense amounts, acquisition and
divestiture-related expenses, certain non-operating expenses, and
(if applicable in a particular period) certain costs not
anticipated to occur in future periods (together, the
“Adjustments”). The non-GAAP tax rate used to calculate Adjusted
Net Income was approximately 22.4% and 23.1% for the three and
twelve months ended December 31, 2019, respectively, and 20.9%
and 24.1% for three and twelve months ended December 31, 2018,
respectively. The non-GAAP tax rates represent the GAAP tax rate
for the period as adjusted by the estimated tax impact of the items
adjusted from the measure. Adjusted Net Income per diluted share is
calculated by dividing Adjusted Net Income by weighted average
diluted shares outstanding.
Adjusted Free Cash Flow
Adjusted Free Cash Flow is defined as cash
provided by operating activities less the impact of changes in
restricted cash due to the timing of payments of restricted cash
liabilities and less payments for capital expenditures, including
those financed through direct debt, but excluding acquisitions. The
Adjusted Free Cash Flow measure does not take into consideration
certain financing activities and other non-discretionary cash
requirements such as mandatory principal payments on portions of
the Company’s long-term debt.
Constant-Currency
Management calculates certain GAAP as well as
non-GAAP measures on a constant-currency basis using the average
foreign currency exchange rates applicable in the corresponding
period of the previous year and applying these rates to the
measures in the current reporting period to assess performance and
eliminate the effect foreign currency exchange rates have on
comparability between periods.
Consolidated Statements of
OperationsFor the Three and Twelve Months Ended
December 31, 2019 and 2018(In thousands,
excluding share, per share amounts, and
percentages)(Unaudited)
|
|
Three Months Ended |
|
Twelve Months Ended |
|
|
December 31, |
|
December 31, |
|
|
2019 |
|
2018 |
|
% Change |
|
2019 |
|
2018 |
|
% Change |
|
|
(Unaudited) |
|
(Unaudited) |
|
|
|
(Unaudited) |
|
|
|
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
ATM operating revenues |
|
$ |
322,039 |
|
|
|
$ |
314,141 |
|
|
2.5 |
% |
|
$ |
1,281,106 |
|
|
|
$ |
1,292,930 |
|
|
(0.9 |
)% |
ATM product sales and other revenues |
|
16,768 |
|
|
|
13,756 |
|
|
21.9 |
|
|
68,299 |
|
|
|
52,313 |
|
|
30.6 |
|
Total revenues |
|
338,807 |
|
|
|
327,897 |
|
|
3.3 |
|
|
1,349,405 |
|
|
|
1,345,243 |
|
|
0.3 |
|
Cost of revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
Cost of ATM operating revenues (excludes depreciation, accretion,
and amortization of intangible assets reported separately
below) |
|
207,260 |
|
|
|
208,256 |
|
|
(0.5 |
) |
|
830,359 |
|
|
|
855,948 |
|
|
(3.0 |
) |
Cost of ATM product sales and other revenues |
|
13,472 |
|
|
|
10,307 |
|
|
30.7 |
|
|
54,620 |
|
|
|
41,835 |
|
|
30.6 |
|
Total cost of revenues |
|
220,732 |
|
|
|
218,563 |
|
|
1.0 |
|
|
884,979 |
|
|
|
897,783 |
|
|
(1.4 |
) |
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general, and administrative expenses |
|
45,562 |
|
|
|
45,926 |
|
|
(0.8 |
) |
|
177,474 |
|
|
|
170,490 |
|
|
4.1 |
|
Restructuring expenses |
|
1,882 |
|
|
|
1,052 |
|
|
78.9 |
|
|
8,928 |
|
|
|
6,586 |
|
|
35.6 |
|
Acquisition related expenses |
|
— |
|
|
|
558 |
|
|
n/m |
|
— |
|
|
|
3,191 |
|
|
n/m |
Depreciation and accretion expense |
|
31,032 |
|
|
|
32,746 |
|
|
(5.2 |
) |
|
130,676 |
|
|
|
126,199 |
|
|
3.5 |
|
Amortization of intangible assets |
|
11,854 |
|
|
|
12,648 |
|
|
(6.3 |
) |
|
49,261 |
|
|
|
52,911 |
|
|
(6.9 |
) |
Loss on disposal and impairment of assets |
|
8,552 |
|
|
|
2,290 |
|
|
273.4 |
|
|
11,653 |
|
|
|
17,873 |
|
|
(34.8 |
) |
Total operating expenses |
|
98,882 |
|
|
|
95,220 |
|
|
3.8 |
|
|
377,992 |
|
|
|
377,250 |
|
|
0.2 |
|
Income from operations |
|
19,193 |
|
|
|
14,114 |
|
|
36.0 |
|
|
86,434 |
|
|
|
70,210 |
|
|
23.1 |
|
Other (income) expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense, net |
|
6,339 |
|
|
|
8,244 |
|
|
(23.1 |
) |
|
26,604 |
|
|
|
35,429 |
|
|
(24.9 |
) |
Amortization of deferred financing costs and note discount |
|
3,448 |
|
|
|
4,827 |
|
|
(28.6 |
) |
|
13,447 |
|
|
|
14,887 |
|
|
(9.7 |
) |
Redemption cost for early extinguishment of debt |
|
— |
|
|
|
6,408 |
|
|
n/m |
|
— |
|
|
|
6,408 |
|
|
(100.0 |
) |
Other (income) expenses |
|
(8,950 |
) |
|
|
697 |
|
|
n/m |
|
(18,404 |
) |
|
|
(627 |
) |
|
n/m |
Total other expenses |
|
837 |
|
|
|
20,176 |
|
|
(95.9 |
) |
|
21,647 |
|
|
|
56,097 |
|
|
(61.4 |
) |
Income (loss) before
income taxes |
|
18,356 |
|
|
|
(6,062 |
) |
|
(402.8 |
) |
|
64,787 |
|
|
|
14,113 |
|
|
359.1 |
|
Income tax expense |
|
5,742 |
|
|
|
48 |
|
|
n/m |
|
16,522 |
|
|
|
10,457 |
|
|
58.0 |
|
Effective tax rate |
|
31.3 |
|
% |
|
(0.8 |
)% |
|
|
|
25.5 |
|
% |
|
74.1 |
% |
|
|
Net income (loss) |
|
12,614 |
|
|
|
(6,110 |
) |
|
n/m |
|
48,265 |
|
|
|
3,656 |
|
|
n/m |
Net loss attributable to
noncontrolling interests |
|
(6 |
) |
|
|
(6 |
) |
|
— |
|
|
(9 |
) |
|
|
(20 |
) |
|
n/m |
Net income (loss) attributable
to controlling interests and available to common shareholders |
|
$ |
12,620 |
|
|
|
$ |
(6,104 |
) |
|
n/m |
|
$ |
48,274 |
|
|
|
$ |
3,676 |
|
|
n/m |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per common
share – basic |
|
$ |
0.28 |
|
|
|
$ |
(0.13 |
) |
|
|
|
$ |
1.06 |
|
|
|
$ |
0.08 |
|
|
|
Net income (loss) per common
share – diluted |
|
$ |
0.28 |
|
|
|
$ |
(0.13 |
) |
|
|
|
$ |
1.05 |
|
|
|
$ |
0.08 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares
outstanding – basic |
|
44,619,307 |
|
46,116,518 |
|
|
|
45,514,703 |
|
45,988,775 |
|
|
Weighted average shares
outstanding – diluted |
|
45,288,321 |
|
46,116,518 |
|
|
|
46,015,334 |
|
46,436,439 |
|
|
Condensed Consolidated Balance
SheetsAs of December 31, 2019 and
December 31, 2018(In thousands)
|
|
December 31, 2019 |
|
December 31, 2018 |
|
|
(Unaudited) |
|
|
ASSETS |
|
|
|
|
Current assets: |
|
|
|
|
Cash and cash equivalents |
|
$ |
30,115 |
|
|
$ |
39,940 |
|
Accounts and notes receivable, net |
|
95,795 |
|
|
75,643 |
|
Inventory, net |
|
10,618 |
|
|
11,392 |
|
Restricted cash |
|
87,354 |
|
|
155,470 |
|
Prepaid expenses, deferred costs, and other current assets |
|
84,639 |
|
|
84,386 |
|
Total current assets |
|
308,521 |
|
|
366,831 |
|
Property and equipment,
net |
|
461,277 |
|
|
460,187 |
|
Intangible assets, net |
|
113,925 |
|
|
150,847 |
|
Goodwill |
|
752,592 |
|
|
749,144 |
|
Operating lease assets |
|
76,548 |
|
|
— |
|
Deferred tax asset, net |
|
13,159 |
|
|
8,658 |
|
Prepaid expenses, deferred
costs, and other noncurrent assets |
|
37,936 |
|
|
51,677 |
|
Total assets |
|
$ |
1,763,958 |
|
|
$ |
1,787,344 |
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS’ EQUITY |
|
|
|
|
Current liabilities: |
|
|
|
|
Current portion of other long-term liabilities |
|
$ |
53,144 |
|
|
$ |
20,266 |
|
Accounts payable and other accrued and current liabilities |
|
381,240 |
|
|
408,470 |
|
Total current liabilities |
|
434,384 |
|
|
428,736 |
|
Long-term liabilities: |
|
|
|
|
Long-term debt |
|
739,475 |
|
|
818,485 |
|
Asset retirement obligations |
|
55,494 |
|
|
54,413 |
|
Non-current operating lease liabilities |
|
69,531 |
|
|
— |
|
Deferred tax liability, net |
|
46,878 |
|
|
41,198 |
|
Other long-term liabilities |
|
37,870 |
|
|
67,740 |
|
Total liabilities |
|
1,383,632 |
|
|
1,410,572 |
|
Shareholders' equity |
|
380,326 |
|
|
376,772 |
|
Total liabilities and shareholders’ equity |
|
$ |
1,763,958 |
|
|
$ |
1,787,344 |
|
SELECTED BALANCE SHEET DETAIL:
Long-Term
Debt: |
|
December 31, 2019 |
|
December 31, 2018 |
|
|
(In thousands) |
|
|
(Unaudited) |
|
|
Revolving credit facility |
|
$ |
167,227 |
|
|
$ |
259,081 |
|
1.00% Convertible senior notes
due December 2020 (1) |
|
275,703 |
|
|
263,507 |
|
5.50% Senior Notes due May
2025(2) |
|
296,545 |
|
|
295,897 |
|
Total long-term debt |
|
$ |
739,475 |
|
|
$ |
818,485 |
|
(1) The 1.00% Convertible Senior Notes due
2020 with a face value of $287.5 million are presented net of the
unamortized discount and capitalized debt issuance costs of
$11.8 million and $24.0 million as of December 31, 2019
and December 31, 2018, respectively. In accordance with GAAP,
the estimated fair value of the conversion feature within the
Convertible Senior Notes was recorded as additional paid-in capital
within equity at issuance. The Convertible Senior Notes are being
accreted over the term of the notes to the full principal amount
($287.5 million). Although the Convertible Notes are due in
December 2020, it is currently Management's intent to utilize the
available capacity under the Revolving credit facility to fund the
December 2020 repayment of the Convertible Notes. Therefore, the
Convertible Notes remain classified in the Long-term debt line in
the accompanying Consolidated Balance Sheets at December 31,
2019.
(2) The 5.50% Senior Notes due May 2025 with a face
value of $300.0 million are presented net of capitalized debt
issuance costs of $3.5 million and $4.1 million as of
December 31, 2019 and December 31, 2018,
respectively.
Reconciliation of Net Income (Loss)
Attributable to Controlling Interests and Available to Common
Shareholders to EBITDA, Adjusted EBITDA, and
Adjusted Net IncomeFor the Three and Twelve Months
Ended December 31, 2019 and 2018 (In
thousands, excluding share and per share
amounts)(Unaudited)
|
Three Months Ended |
|
Twelve Months Ended |
|
December 31, |
|
December 31, |
|
2019 |
|
2018 |
|
2019 |
|
2018 |
Net income (loss)
attributable to controlling interests and available to common
shareholders |
$ |
12,620 |
|
|
|
$ |
(6,104 |
) |
|
|
$ |
48,274 |
|
|
|
$ |
3,676 |
|
|
Adjustments: |
|
|
|
|
|
|
|
Interest expense, net |
6,339 |
|
|
|
8,244 |
|
|
|
26,604 |
|
|
|
35,429 |
|
|
Amortization of deferred financing costs and note discount |
3,448 |
|
|
|
4,827 |
|
|
|
13,447 |
|
|
|
14,887 |
|
|
Redemption costs for early extinguishment of debt |
— |
|
|
|
6,408 |
|
|
|
— |
|
|
|
6,408 |
|
|
Income tax expense |
5,742 |
|
|
|
48 |
|
|
|
16,522 |
|
|
|
10,457 |
|
|
Depreciation and accretion expense |
31,032 |
|
|
|
32,746 |
|
|
|
130,676 |
|
|
|
126,199 |
|
|
Amortization of intangible assets |
11,854 |
|
|
|
12,648 |
|
|
|
49,261 |
|
|
|
52,911 |
|
|
EBITDA |
$ |
71,035 |
|
|
|
$ |
58,817 |
|
|
|
$ |
284,784 |
|
|
|
$ |
249,967 |
|
|
|
|
|
|
|
|
|
|
Add back: |
|
|
|
|
|
|
|
Loss on disposal and impairment of assets (1) |
8,552 |
|
|
|
2,290 |
|
|
|
11,653 |
|
|
|
17,873 |
|
|
Other (income) loss (2) |
(8,950 |
) |
|
|
697 |
|
|
|
(18,404 |
) |
|
|
(627 |
) |
|
Noncontrolling interests (3) |
12 |
|
|
|
7 |
|
|
|
58 |
|
|
|
38 |
|
|
Share-based compensation expense |
5,595 |
|
|
|
5,033 |
|
|
|
20,962 |
|
|
|
15,660 |
|
|
Restructuring expenses (4) |
1,882 |
|
|
|
1,052 |
|
|
|
8,928 |
|
|
|
6,586 |
|
|
Acquisition related expenses (5) |
— |
|
|
|
558 |
|
|
|
— |
|
|
|
3,191 |
|
|
Adjusted
EBITDA |
$ |
78,126 |
|
|
|
$ |
68,454 |
|
|
|
$ |
307,981 |
|
|
|
$ |
292,688 |
|
|
Less: |
|
|
|
|
|
|
|
Interest expense, net |
6,339 |
|
|
|
8,244 |
|
|
|
26,604 |
|
|
|
35,429 |
|
|
Depreciation and accretion expense (6) |
31,031 |
|
|
|
32,745 |
|
|
|
130,675 |
|
|
|
126,197 |
|
|
Adjusted pre-tax income |
40,756 |
|
|
|
27,465 |
|
|
|
150,702 |
|
|
|
131,062 |
|
|
Income tax expense (7) |
9,130 |
|
|
|
5,740 |
|
|
|
34,877 |
|
|
|
31,529 |
|
|
Adjusted Net
Income |
$ |
31,626 |
|
|
|
$ |
21,725 |
|
|
|
$ |
115,825 |
|
|
|
$ |
99,533 |
|
|
|
|
|
|
|
|
|
|
Adjusted Net Income
per share – basic |
$ |
0.71 |
|
|
|
$ |
0.47 |
|
|
|
$ |
2.54 |
|
|
|
$ |
2.16 |
|
|
Adjusted Net Income
per share – diluted |
$ |
0.70 |
|
|
|
$ |
0.47 |
|
|
|
$ |
2.52 |
|
|
|
$ |
2.14 |
|
|
|
|
|
|
|
|
|
|
Weighted average shares
outstanding – basic |
44,619,307 |
|
46,116,518 |
|
45,514,703 |
|
45,988,775 |
Weighted average shares
outstanding – diluted |
45,288,321 |
|
46,581,822 |
|
46,015,334 |
|
46,436,439 |
(1) Includes a goodwill impairment of $7.3
million on the Canada reporting unit during the three months ended
December 31, 2019.(2) Includes the revaluation of the
estimated acquisition related contingent consideration, foreign
currency translation gains/losses and other non-operating
costs.(3) Noncontrolling interest adjustment made such that
Adjusted EBITDA includes only our ownership interest in the
Adjusted EBITDA of one of our Mexican subsidiaries.(4)
For the three and twelve months ended December 31, 2019 and 2018,
restructuring activities included workforce reductions, costs
incurred in conjunction with facilities closures, professional fees
and other related charges.(5) For the three and twelve months ended
December 31, 2018, Acquisition related expenses include costs
incurred for professional and legal fees and certain other
transition and integration-related costs related to the DCPayments
acquisition.(6) Amounts exclude a portion of the expenses
incurred by one of its Mexican subsidiaries to account for the
amounts allocable to the noncontrolling interest
shareholders.(7) For the three and twelve months ended
December 31, 2019, the non-GAAP tax rate used to calculate
Adjusted Net Income was 22.4% and 23.1%, respectively. For the
three and twelve months ended December 31, 2018, the non-GAAP tax
rate used to calculate Adjusted Net Income was 20.9% and 24.1%,
respectively. These figures represent the Company’s GAAP tax rates
as adjusted for the net tax effects related to the items excluded
from Adjusted Net Income.
Reconciliation of U.S. GAAP Revenue to
Constant-Currency RevenueFor the Three and Twelve
Months Ended December 31, 2019 and 2018(In
thousands, excluding
percentages)(Unaudited)
Consolidated revenue: |
|
|
|
Three Months Ended |
|
|
|
December 31, |
|
|
|
2019 |
|
2018 |
|
% Change |
|
|
U.S. GAAP |
|
ForeignCurrencyImpact |
|
Constant -Currency |
|
U.S. GAAP |
|
U.S. GAAP |
|
Constant -Currency |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ATM operating revenues |
|
$ |
322,039 |
|
|
$ |
1,668 |
|
|
$ |
323,707 |
|
|
$ |
314,141 |
|
|
2.5 |
% |
|
3.0 |
% |
|
ATM product sales and other
revenues |
|
16,768 |
|
|
22 |
|
|
16,790 |
|
|
13,756 |
|
|
21.9 |
|
|
22.1 |
|
|
Total revenues |
|
$ |
338,807 |
|
|
$ |
1,690 |
|
|
$ |
340,497 |
|
|
$ |
327,897 |
|
|
3.3 |
% |
|
3.8 |
% |
|
|
|
Twelve Months Ended |
|
|
|
December 31, |
|
|
|
2019 |
|
2018 |
|
% Change |
|
|
U.S. GAAP |
|
ForeignCurrencyImpact |
|
Constant - Currency |
|
U.S. GAAP |
|
U.S. GAAP |
|
Constant - Currency |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ATM operating revenues |
|
$ |
1,281,106 |
|
|
$ |
29,450 |
|
|
$ |
1,310,556 |
|
|
$ |
1,292,930 |
|
|
(0.9 |
)% |
|
1.4 |
% |
|
ATM product sales and other
revenues |
|
68,299 |
|
|
657 |
|
|
68,956 |
|
|
52,313 |
|
|
30.6 |
|
|
31.8 |
|
|
Total revenues |
|
$ |
1,349,405 |
|
|
$ |
30,107 |
|
|
$ |
1,379,512 |
|
|
$ |
1,345,243 |
|
|
0.3 |
% |
|
2.5 |
% |
|
Reconciliation of Gross Profit Inclusive
of Depreciation, Accretion, and Amortization of Intangible Assets
to Adjusted Gross ProfitFor the Three and Twelve
Months Ended December 31, 2019 and 2018 (In
thousands, excluding
percentages)(Unaudited)
|
|
Three Months Ended |
|
Twelve Months Ended |
|
|
December 31, |
|
December 31, |
|
|
2019 |
|
2018 |
|
2019 |
|
2018 |
Total revenues |
|
$ |
338,807 |
|
|
$ |
327,897 |
|
|
$ |
1,349,405 |
|
|
$ |
1,345,243 |
|
Total cost of revenues
(1) |
|
220,732 |
|
|
218,563 |
|
|
884,979 |
|
|
897,783 |
|
Total depreciation, accretion,
and amortization of intangible assets excluded from total cost of
revenues |
|
34,088 |
|
|
36,579 |
|
|
146,385 |
|
|
145,716 |
|
Gross profit inclusive of depreciation, accretion, and amortization
of intangible assets |
|
83,987 |
|
|
72,755 |
|
|
318,041 |
|
|
301,744 |
|
Gross Margin (inclusive of depreciation, accretion, and
amortization of intangible assets) |
|
24.8 |
% |
|
22.2 |
% |
|
23.6 |
% |
|
22.4 |
% |
Total depreciation, accretion,
and amortization of intangible assets excluded from gross
profit |
|
34,088 |
|
|
36,579 |
|
|
146,385 |
|
|
145,716 |
|
Adjusted Gross Profit exclusive of depreciation, accretion, and
amortization of intangible assets |
|
$ |
118,075 |
|
|
$ |
109,334 |
|
|
$ |
464,426 |
|
|
$ |
447,460 |
|
Adjusted Gross Margin
(exclusive of depreciation, accretion, and amortization of
intangible assets) |
|
34.9 |
% |
|
33.3 |
% |
|
34.4 |
% |
|
33.3 |
% |
(1) The Company presents the Total cost of revenues in the
Company’s Consolidated Statements of Operations exclusive of
depreciation and accretion, and amortization of intangible
assets.
Reconciliation of Adjusted EBITDA,
Adjusted Net Income, and Adjusted Net Income per diluted share on a
Non-GAAP basis to Constant-CurrencyFor the Three
and Twelve Months Ended December 31, 2019 and
2018(In thousands, excluding per share amounts and
percentages)(Unaudited)
|
|
Three Months Ended |
|
|
December 31, |
|
|
2019 |
|
2018 |
|
% Change |
|
|
Non -
GAAP (1) |
|
ForeignCurrency Impact |
|
Constant - Currency |
|
Non -
GAAP (1) |
|
Non -
GAAP (1) |
|
Constant - Currency |
Adjusted EBITDA |
|
$ |
78,126 |
|
|
$ |
478 |
|
|
$ |
78,604 |
|
|
$ |
68,454 |
|
|
14.1 |
% |
|
14.8 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Net Income |
|
$ |
31,626 |
|
|
$ |
233 |
|
|
$ |
31,859 |
|
|
$ |
21,725 |
|
|
45.6 |
% |
|
46.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Net Income per share
– diluted (2) |
|
$ |
0.70 |
|
|
$ |
— |
|
|
$ |
0.70 |
|
|
$ |
0.47 |
|
|
48.9 |
% |
|
48.9 |
% |
|
|
Twelve Months Ended |
|
|
December 31, |
|
|
2019 |
|
2018 |
|
% Change |
|
|
Non -
GAAP (1) |
|
ForeignCurrency Impact |
|
Constant -Currency |
|
Non -
GAAP (1) |
|
Non -
GAAP (1) |
|
Constant -Currency |
Adjusted EBITDA |
|
$ |
307,981 |
|
|
$ |
6,819 |
|
|
$ |
314,800 |
|
|
$ |
292,688 |
|
|
5.2 |
% |
|
7.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Net Income |
|
$ |
115,825 |
|
|
$ |
2,486 |
|
|
$ |
118,311 |
|
|
$ |
99,533 |
|
|
16.4 |
% |
|
18.9 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Net Income per share –
diluted (2) |
|
$ |
2.52 |
|
|
$ |
0.05 |
|
|
$ |
2.57 |
|
|
$ |
2.14 |
|
|
17.8 |
% |
|
20.1 |
% |
(1) As reported on the Company’s Reconciliation of Net
Income (Loss) Attributable to Controlling Interests and Available
to Common Shareholders to EBITDA, Adjusted EBITDA, and Adjusted Net
Income, see Disclosure of Non-GAAP Financial Information in this
earnings release for further discussion.(2) Adjusted Net
Income per diluted share is calculated by dividing Adjusted Net
Income by the weighted average diluted shares outstanding of
45,288,321 and 46,581,822 for the three months ended
December 31, 2019 and 2018, respectively, and 46,015,334 and
46,436,439 for the twelve months ended December 31, 2019 and 2018,
respectively.
Reconciliation of Adjusted Free Cash
FlowFor the Three and Twelve Months Ended
December 31, 2019 and 2018 (In
thousands)(Unaudited)
|
|
Three Months Ended |
|
Twelve Months Ended |
|
|
December 31, |
|
December 31, |
|
|
2019 |
|
2018 |
|
2019 |
|
2018 |
Net cash (used in) provided by
operating activities |
|
$ |
(27,033 |
) |
|
|
$ |
149,620 |
|
|
|
$ |
204,659 |
|
|
|
$ |
334,202 |
|
|
Restricted cash settlement
activity (1) |
|
93,111 |
|
|
|
(83,385 |
) |
|
|
70,482 |
|
|
|
(109,093 |
) |
|
Adjusted net cash provided by
operating activities |
|
66,078 |
|
|
|
66,235 |
|
|
|
275,141 |
|
|
|
225,109 |
|
|
Net cash used in investing
activities, excluding acquisitions (2) |
|
(34,587 |
) |
|
|
(33,848 |
) |
|
|
(124,906 |
) |
|
|
(107,205 |
) |
|
Adjusted free cash flow |
|
$ |
31,491 |
|
|
|
$ |
32,387 |
|
|
|
$ |
150,235 |
|
|
|
$ |
117,904 |
|
|
(1) Restricted cash settlement activity represents the
change in our restricted cash excluding the portion of the change
that is attributable to foreign exchange and disclosed as part of
the effect of exchange rate changes on cash, cash equivalents, and
restricted cash in our Consolidated Statements of Cash Flows.
Restricted cash largely consists of amounts collected on behalf of,
but not yet remitted to, certain of the Company’s merchant
customers or third-party service providers that are pledged for a
particular use or restricted to support these obligations.(2)
Capital expenditure amounts include payments made for exclusive
license agreements, site acquisition costs, and other assets.
Additionally, capital expenditure amounts for one of our Mexican
subsidiaries are reflected gross of any noncontrolling interest
amounts.
Reconciliation of Estimated Net Income to
EBITDA, Adjusted EBITDA, and Adjusted Net
IncomeFor the Year Ending December 31,
2020 (In millions, excluding per share
amounts)(Unaudited)
|
|
Estimated Range |
|
|
Full Year 2020 (1) |
Net Income |
|
$ |
51.7 |
|
|
$ |
55.6 |
|
Adjustments: |
|
|
|
|
Interest expense,
net |
|
24.4 |
|
|
25.5 |
|
Amortization of
deferred financing costs and note discount |
|
13.3 |
|
|
13.5 |
|
Income tax expense |
|
23.2 |
|
|
25.0 |
|
Depreciation and
accretion expense |
|
140.0 |
|
|
142.0 |
|
Amortization of intangible assets |
|
47.4 |
|
|
48.4 |
|
EBITDA |
|
300.0 |
|
|
310.0 |
|
|
|
|
|
|
Add Back: |
|
|
|
|
Other expense |
|
2.0 |
|
|
2.0 |
|
Share-based
compensation expense |
|
23.0 |
|
|
23.0 |
|
Adjusted EBITDA |
|
325.0 |
|
|
335.0 |
|
Less: |
|
|
|
|
Interest expense,
net |
|
24.4 |
|
|
25.5 |
|
Depreciation and
accretion expense |
|
140.0 |
|
|
142.0 |
|
Income tax expense
(2) |
|
41.8 |
|
|
43.5 |
|
Adjusted Net Income |
|
$ |
118.8 |
|
|
$ |
124.0 |
|
|
|
|
|
|
Adjusted Net Income per share
– diluted |
|
$ |
2.58 |
|
|
$ |
2.70 |
|
|
|
|
|
|
Weighted average shares
outstanding – diluted |
|
46.0 |
|
|
46.0 |
|
(1) See Disclosure of Non-GAAP Financial
Information in this earnings release for definitions of the
non-GAAP measures included in this table.(2) Calculated using
the Company’s estimated non-GAAP tax rate of approximately 26% as
adjusted for items excluded from Adjusted Net Income. See
Disclosure of Non-GAAP Financial Information in this earnings
release for further discussion.
Cardtronics is a registered trademark of
Cardtronics plc and its subsidiaries.All other trademarks are the
property of their respective owners.
Cardtronics (NASDAQ:CATM)
Historical Stock Chart
From Jul 2024 to Aug 2024
Cardtronics (NASDAQ:CATM)
Historical Stock Chart
From Aug 2023 to Aug 2024