Cantaloupe, Inc., (NASDAQ:CTLP) (“CTLP” or the “Company”), a
digital payments and software services company that provides
end-to-end technology solutions for the unattended retail market,
today reported results for the fiscal year 2021 third quarter.
“We are pleased with our financial results for the third fiscal
quarter, which improved sequentially as schools and other
organizations across the country continue to re-open. During the
quarter we also made great progress on our strategic initiatives by
driving sustainable organic growth through deepening existing
relationships and winning new customers,” said Sean Feeney, chief
executive officer, Cantaloupe, Inc. “One year into leading this
incredible company, I am proud of the progress we’ve made at the
Company. The successful rebrand to Cantaloupe has re-energized us
as we emerge from the pandemic and set forth on a path to growth
and future successes, as we help the world buy it and go.”
Financial Highlights:
- Revenue of $42.8 million, an increase of 11.7% versus second
quarter 2021, and a decrease of 0.8% year over year
- License and transaction fee revenue of $34.7 million, an
increase of 4.4% versus second quarter 2021 and a decrease of 0.8%
year-over-year and
- Equipment revenue of $8.1 million, an increase of 59.2% over
second quarter 2021 and a decrease of 0.8% year over year
- Active Devices, defined as devices that have communicated or
transacted with the Company in the last 12 months, totaled 1.08
million at the end of the third quarter of 2021 compared to 1.05
million at the end of the third quarter of 2020, an increase of
approximately 30,000 Active Devices, or 3%
- Active Customers, defined as customers that have at least one
Active Device, totaled 18,763 at the end of the third quarter of
2021 compared to 16,808 at the end of the third quarter of 2020, an
increase of 1,955 Active Customers, or 12%
- Gross margin of 29.7% compared with 25.5% in the prior year
period
- Operating loss of $2.0 million for the quarter ended March 31,
2021 compared to operating loss of $10.2 million in the prior year
period, driven primarily by a $6.5 million reduction in operating
expenses
- GAAP Net loss applicable to common shares of $2.2 million, or
$0.03 per basic share compared to net loss applicable to common
shares of $9.6 million, or $0.15 per basic share in the prior year
period
- Adjusted EBITDA1 of $2.2 million compared to $(3.9) million in
the prior year period
- Raised $55 million of aggregate gross proceeds from
institutional accredited investors through a private placement
transaction
- Ended the quarter with $88.6 million in cash and cash
equivalents compared to $31.7 million as of June 30, 2020
Operational Highlights:
- Renewed Small Ticket Incentive Agreement with Visa U.S.A.
Inc.
- Experienced increased momentum in customers converting from
2G/3G to 4G LTE devices
- Upgraded and expanded the ePort product family to accept EMV
contact and contactless payments
- Launched next generation of Seed Cashless+ tailored to small
and medium businesses (SMBs) in the channel
- Announced eCommerce integration for Office Coffee Service
(“OCS”) and Delivery Services
- In April, USA Technologies, Inc. officially launched as
Cantaloupe, Inc. (Nasdaq: CTLP), celebrating its rebranding under a
new name and ticker
Fiscal Year 2021 Outlook:
For full fiscal year 2021, the Company is reiterating the
following:
- Revenue to be between $163 million and $171 million
- GAAP Net loss applicable to common shares to be between $17
million and $21 million
- Adjusted EBITDA2 to be between $1 million and $4 million
Webcast and Conference Call
Cantaloupe, Inc. will host a conference call and webcast at 4:30
p.m. Eastern Time today. To participate in the conference call,
please dial +1 (866) 393-1608 approximately 10 minutes prior to the
call. International callers should dial +1 (224) 357-2194. Please
reference conference ID # 4396162. A live webcast of the conference
call will be available at
https://cantaloupeinc.gcs-web.com/events-and-presentations. Please
access the website 15 minutes prior to the start of the call to
download and install any necessary audio software.
A telephone replay of the conference call will be available from
7:30 p.m. Eastern Time on May 6, 2021 until 7:30 p.m. Eastern Time
on May 9, 2021 and may be accessed by calling +1 (855) 859-2056
(domestic dial-in) or +1 (404) 537-3406 (international dial-in) and
reference conference ID # 4396162.
An archived replay of the conference call will also be available
in the investor relations section of the company's website.
About Cantaloupe, Inc.
Cantaloupe, Inc. is a software and payments company that
provides end-to-end technology solutions for the unattended retail
market. Cantaloupe is transforming the unattended retail community
by offering one integrated solution for payments processing,
logistics, and back-office management. The Company’s
enterprise-wide platform is designed to increase consumer
engagement and sales revenue through digital payments, digital
advertising and customer loyalty programs, while providing
retailers with control and visibility over their operations and
inventory. As a result, customers ranging from vending machine
companies, to operators of micro-markets, gas and car charging
stations, laundromats, metered parking terminals, kiosks,
amusements and more, can run their businesses more proactively,
predictably, and competitively.
Discussion of Non-GAAP Financial Measures:
This press release contains discussion of adjusted EBITDA, a
non-GAAP financial measure which is not required or defined under
GAAP (Generally Accepted Accounting Principles). Generally, a
non-GAAP financial measure is a numerical measure of a company's
performance, financial position or cash flows that either excludes
or includes amounts that are not normally excluded or included in
the most directly comparable measure calculated and presented in
accordance with GAAP. Reconciliations between non-GAAP financial
measures and the most comparable GAAP financial measures are set
forth below on Page 7.
We use these non-GAAP financial measures for financial and
operational decision-making purposes and as a means to evaluate
period-to-period comparisons. We believe that these non-GAAP
financial measures provide useful information about our operating
results, enhance the overall understanding of past financial
performance and future prospects and allow for greater transparency
with respect to metrics used by our management in its financial and
operational decision making. 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 our 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 our net income or net loss
as determined in accordance with GAAP and are not a substitute for
or a measure of our profitability or net earnings. Adjusted EBITDA
is presented because we believe it is useful to investors as a
measure of comparative operating performance. Additionally, we
utilize Adjusted EBITDA as a metric in our executive officer and
management incentive compensation plans.
We define Adjusted EBITDA as U.S. GAAP net loss before (i)
interest income, (ii) interest expense on debt and reserves, (iii)
income taxes, (iv) depreciation, (v) amortization, (vi) stock-based
compensation expense, and (vii) non-recurring fees and charges that
were incurred in connection with the 2019 Investigation and
financial statement restatement activities as well as proxy
solicitation costs (viii) changes in the fair value of the embedded
derivative relating to the 2020 Antara Term Facility that was
bifurcated and recognized at fair value.
We have excluded stock-based compensation, as it does not
reflect our cash-based operations. We have excluded the
professional fees incurred in connection with the non-recurring
costs and expenses related to the 2019 Investigation, financial
statement restatement activities, and proxy solicitation costs
because we believe that they represent charges that are not related
to our operations. Consistent with the exclusion of debt interest
expense from EBITDA, the debt-related derivative gain recorded for
the quarter ended March 31, 2020 was also excluded from adjusted
EBITDA.
Forward-looking Statements:
All statements other than statements of historical fact included
in this release, including without limitation Cantaloupe’s future
prospects and performance, the business strategy and the plans and
objectives of Cantaloupe's management for future operations, are
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. When used in this
release, words such as “may,” “could,” “expect,” “intend,” “plan,”
“seek,” “anticipate,” “believe,” “estimate,” “guidance,” “predict,”
“potential,” “continue,” “likely,” “will,” “would” and variations
of these terms and similar expressions, or the negative of these
terms or similar expressions, as they relate to Cantaloupe or its
management, may identify forward-looking statements. Such
forward-looking statements are based on the reasonable beliefs of
Cantaloupe's management, as well as assumptions made by and
information currently available to Cantaloupe's management. Actual
results could differ materially from those contemplated by the
forward-looking statements as a result of certain factors,
including but not limited to the incurrence by Cantaloupe of any
unanticipated or unusual non-operational expenses which would
require us to divert our cash resources from achieving our business
plan; the uncertainties associated with COVID-19, including its
possible effects on Cantaloupe’s operations, financial condition
and the demand for Cantaloupe’s products and services; the ability
of Cantaloupe to predict or estimate its future quarterly or annual
revenue and expenses given the developing and unpredictable market
for its products; the ability of Cantaloupe to retain key customers
from whom a significant portion of its revenues is derived; the
ability of Cantaloupe to compete with its competitors to obtain
market share; the ability of Cantaloupe to make available and
successfully upgrade current customers to new standards and
protocols; whether Cantaloupe's existing or anticipated customers
purchase, rent or utilize ePort or Seed devices or our other
products or services in the future at levels currently anticipated
by Cantaloupe; disruptions to our systems, breaches in the security
of transactions involving our products or services, or failure of
our processing systems; or other risks discussed in Cantaloupe’s
filings with the U.S. Securities and Exchange Commission, including
but not limited to its Annual Report on Form 10-K for the year
ended June 30, 2020 and its Quarterly Reports on Form 10-Q for the
quarters ended September 30, 2020 and December 31, 2020. Readers
are cautioned not to place undue reliance on these forward-looking
statements. Any forward-looking statement made by us in this
release speaks only as of the date of this release. Unless required
by law, Cantaloupe does not undertake to release publicly any
revisions to these forward-looking statements to reflect future
events or circumstances or to reflect the occurrence of
unanticipated events. If Cantaloupe updates one or more
forward-looking statements, no inference should be drawn that
Cantaloupe will make additional updates with respect to those or
other forward-looking statements.
_____________________________________________
1 Adjusted earnings before income taxes, depreciation, and
amortization (“Adjusted EBITDA”) is a non-GAAP measurement. See
Reconciliations of Non-GAAP Measures for a reconciliation of
Adjusted EBITDA to net loss. 2 Adjusted earnings before income
taxes, depreciation, and amortization (“Adjusted EBITDA”) is a
non-GAAP measurement. See Reconciliations of Non-GAAP Measures for
a reconciliation of Adjusted EBITDA to net loss.
-- F-CTLP
Cantaloupe, Inc.
Condensed Consolidated Balance
Sheets
(Unaudited)
($ in thousands, except share
data)
March 31, 2021
June 30, 2020
Assets
Current assets:
Cash and cash equivalents
$
88,562
$
31,713
Accounts receivable, net
23,124
17,273
Finance receivables, net
7,050
7,468
Inventory, net
6,064
9,128
Prepaid expenses and other current
assets
2,977
1,782
Total current assets
127,777
67,364
Non-current assets:
Finance receivables due after one year
11,123
11,213
Property and equipment, net
5,598
7,872
Operating lease right-of-use assets
4,570
5,603
Intangibles, net
20,747
23,033
Goodwill
63,945
63,945
Other assets
2,148
1,993
Total non-current assets
108,131
113,659
Total assets
$
235,908
$
181,023
Liabilities, convertible preferred
stock and shareholders’ equity
Current liabilities:
Accounts payable
$
34,761
$
27,058
Accrued expenses
28,676
30,265
Current obligations under long-term
debt
3,746
3,328
Deferred revenue
1,670
1,698
Total current liabilities
68,853
62,349
Long-term liabilities:
Deferred income taxes
153
137
Long-term debt, less current portion
13,798
12,435
Operating lease liabilities,
non-current
3,947
4,749
Total long-term liabilities
17,898
17,321
Total liabilities
86,751
79,670
Commitments and contingencies (Note
13)
Convertible preferred stock:
Series A convertible preferred stock,
900,000 shares authorized, 445,063 issued and outstanding, with
liquidation preferences of $21,446 and $20,779 at March 31, 2021
and June 30, 2020, respectively
3,138
3,138
Shareholders’ equity:
Preferred stock, no par value, 1,800,000
shares authorized
—
—
Common stock, no par value, 640,000,000
shares authorized, 71,081,313 and 65,196,882 shares issued and
outstanding at March 31, 2021 and June 30, 2020, respectively
460,059
401,240
Accumulated deficit
(314,040
)
(303,025
)
Total shareholders’ equity
146,019
98,215
Total liabilities, convertible preferred
stock and shareholders’ equity
$
235,908
$
181,023
Cantaloupe, Inc.
Condensed Consolidated
Statements of Operations
(Unaudited)
Three months ended
Nine months ended
March 31,
March 31,
($ in thousands, except per share
data)
2021
2020
2021
2020
Revenue:
License and transaction fees
$
34,686
$
34,961
$
101,008
$
105,324
Equipment sales
8,074
8,137
16,913
25,184
Total revenue
42,760
43,098
117,921
130,508
Cost of sales:
Cost of license and transaction fees
20,463
22,244
60,415
66,912
Cost of equipment sales
9,593
9,856
18,262
28,420
Total cost of sales
30,056
32,100
78,677
95,332
Gross profit
12,704
10,998
39,244
35,176
Operating expenses:
Selling, general and administrative
13,731
15,888
44,371
47,230
Investigation, proxy solicitation and
restatement expenses
—
4,181
—
13,949
Depreciation and amortization
991
1,107
3,111
3,209
Total operating expenses
14,722
21,176
47,482
64,388
Operating loss
(2,018
)
(10,178
)
(8,238
)
(29,212
)
Other income (expense):
Interest income
302
411
978
988
Interest expense
(88
)
(683
)
(3,970
)
(1,981
)
Change in fair value of derivative
—
1,070
—
1,070
Total other income (expense), net
214
798
(2,992
)
77
Loss before income taxes
(1,804
)
(9,380
)
(11,230
)
(29,135
)
Provision for income taxes
(44
)
85
(133
)
(46
)
Net loss
(1,848
)
(9,295
)
(11,363
)
(29,181
)
Preferred dividends
(334
)
(334
)
(668
)
(668
)
Net loss applicable to common shares
$
(2,182
)
$
(9,629
)
$
(12,031
)
$
(29,849
)
Net loss per common share
Basic
$
(0.03
)
$
(0.15
)
$
(0.18
)
$
(0.48
)
Diluted
$
(0.03
)
$
(0.15
)
$
(0.18
)
$
(0.48
)
Weighted average number of common shares
outstanding
Basic
67,112,511
64,096,778
65,617,458
62,591,947
Diluted
67,112,511
64,096,778
65,617,458
62,591,947
Cantaloupe, Inc.
Condensed Consolidated
Statements of Cash Flows
(Unaudited)
Nine months ended
March 31,
($ in thousands)
2021
2020
Cash flows from operating
activities:
Net loss
$
(11,363
)
$
(29,181
)
Adjustments to reconcile net loss to net
cash provided by (used in) operating activities:
Stock based compensation
6,366
2,453
Amortization of debt discount and issuance
costs
2,696
1,040
Provision for expected losses
459
1,400
Provision for inventory reserve
768
(434
)
Depreciation and amortization included in
operating expenses
3,111
3,209
Depreciation included in cost of sales for
rental equipment
1,055
1,984
Change in fair value of derivative
—
(1,070
)
Property and equipment write-off
1,658
—
Other
1,192
1,501
Changes in operating assets and
liabilities:
Accounts receivable
(5,204
)
2,088
Finance receivables
(252
)
(113
)
Inventory
2,297
2,204
Prepaid expenses and other assets
(1,343
)
(1,045
)
Accounts payable and accrued expenses
7,218
(500
)
Operating lease liabilities
(795
)
(1,102
)
Deferred revenue
(28
)
(60
)
Net cash provided by (used in) operating
activities
7,835
(17,626
)
Cash flows from investing
activities:
Purchase of property and equipment
(1,281
)
(1,711
)
Proceeds from sale of property and
equipment
12
33
Net cash used in investing activities
(1,269
)
(1,678
)
Cash flows from financing
activities:
Proceeds from long-term debt issuance by
Antara, net of issuance costs paid to Antara
—
14,248
Payment of third-party debt issuance
costs
—
(1,980
)
Proceeds from (repayments of) Revolving
Credit Facility
—
(10,000
)
Proceeds from long-term debt issuance by
JPMorgan Chase Bank, N.A., net of debt issuance costs
14,550
—
Repayment of long-term debt
(15,554
)
(2,413
)
Proceeds from equity issuance by Antara,
net of issuance costs paid to Antara
—
17,879
Proceeds from private placement
55,008
—
Payment of equity issuance costs
(2,598
)
—
Proceeds from exercise of common stock
options
77
—
Payment of Antara prepayment penalty and
commitment termination fee
(1,200
)
—
Net cash used provided by financing
activities
50,283
17,734
Net increase (decrease) in cash and cash
equivalents
56,849
(1,570
)
Cash and cash equivalents at beginning of
year
31,713
27,464
Cash and cash equivalents at end of
period
$
88,562
$
25,894
Cantaloupe, Inc.
Reconciliation of U.S. GAAP
Net Loss to Adjusted EBITDA
(Unaudited)
Three months ended March
31,
($ in thousands)
2021
2020
U.S. GAAP net loss
$
(1,848
)
$
(9,295
)
Less: interest income
(302
)
(411
)
Plus: interest expense
88
683
Plus: income tax provision
44
(85
)
Plus: depreciation expense included in
cost of sales for rentals
2
593
Plus: depreciation and amortization
expense in operating expenses
991
1,107
EBITDA
(1,025
)
(7,408
)
Plus: stock-based compensation (a)
3,216
421
Plus: investigation, proxy solicitation
and restatement expenses (b)
—
4,181
Less: change in fair value of derivative
(c)
—
(1,070
)
Adjustments to EBITDA
3,216
3,532
Adjusted EBITDA
$
2,191
$
(3,876
)
(a)
As an adjustment to EBITDA, we have
excluded stock-based compensation, as it does not reflect our
cash-based operations.
(b)
As an adjustment to EBITDA, we have
excluded the professional fees incurred in connection with the
non-recurring costs and expenses related to the 2019 Investigation,
financial statement restatement activities, and proxy solicitation
costs.
(c)
Consistent with the exclusion of debt
interest expense from EBITDA, the debt-related derivative gain
recorded for the quarter ended March 31, 2020 was also excluded
from adjusted EBITDA.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210506006173/en/
Media and Investor Relations Contact: Alicia V.
Nieva-Woodgate Cantaloupe, Inc. +1 720.445.4220
anievawoodgate@cantaloupe.com
Investor Relations: ICR, Inc. cantaloupeIR@icrinc.com
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