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 ended
March 31, 2021.
“During the first quarter, we saw continued
strength in our U.S. business, our largest market, driven by growth
in surcharge-free transactions, resulting in another solid quarter
of profits and cash flow generation,” said Ed West, CEO of
Cardtronics.
“As modern banking and consumer preferences
evolve, our value proposition for financial institutions, FinTechs
and retailers has never been stronger. With our leading network,
innovative solutions, exceptional service and convenience, we
continue to earn new business and expand existing relationships, as
evidenced by 12% organic growth in bank-branding and surcharge-free
network revenues during the first quarter.”
“We are pleased that over 99% of our voting
shareholders voted in favor of the previously announced acquisition
agreement with NCR, and we look forward to completing the
transaction. We believe by combining our capabilities, we are
better positioned to offer our customers an even broader range of
financial solutions, enhanced level of services, and greater
overall value,” concluded West.
First Quarter 2021 Financial
Highlights:
Pandemic-related restrictions continue to be
dynamic and impact consumer activity and transaction levels across
the Company's footprint. Strong recoveries of transactions in the
U.S. and South Africa continued into Q1 2021. Adverse impacts from
extended and, in some cases, more restrictive government-mandated
lockdown measures for certain geographies, in particular the
operations in the U.K., Canada, Germany, and Spain, continued
throughout the first quarter of 2021.
- Total revenues of
$267.8 million, down 12.6% from $306.6 million in the prior year,
and down 15.2% on a constant-currency basis. Growth in our core
U.S. business was offset by declines in other regions, especially
in the U.K. and Canada, which were heavily impacted by
pandemic-related social restrictions.
- ATM operating revenues of $255.0
million, down 12.6% from $291.8 million in the prior year, and down
15.1% on a constant-currency basis. U.S. same-store withdrawals
increased 6% vs. Q1 2020 and were up 5% vs. Q1 2019 (non-pandemic
impacted).
- GAAP Net income of $5.9 million, or
$0.13 per diluted share, compared to $5.8 million, or $0.13 per
diluted share in the prior year.
- Adjusted Net Income per diluted
share of $0.42, in line with the prior year.
- Adjusted EBITDA of $69.6 million,
up 9.2% from $63.7 million in the prior year, and up 6.0% on a
constant-currency basis, positively impacted by business rate
(property tax) recoveries in the U.K of approximately $12.0
million
- Adjusted EBITDA margin of 26.0%
compared to 20.8% in the prior year.
- An increase in restricted cash and
corresponding liabilities caused reported net cash provided by
operating activities to be $69.4 million compared to $1.1 million
in the prior year. Adjusted net cash provided by operating
activities, which excludes the impact of restricted cash settlement
activity, was $65.0 million compared to $41.0 million in the prior
year.
- Adjusted free cash flow of $48.8
million compared to $22.6 million in the prior year.
- Net Debt reduction of $24.3 million
during the quarter.
Recent Business Highlights:
- New ATM service
agreement for over 300 ATMs with MAPCO, a leading convenience store
chain throughout the southeastern U.S.
- Expanded branding relationship with
KeyBank for approximately 50 ATMs at Kum & Go locations in
Colorado
- Adding approximately 50 ATMs at CVS
Pharmacy locations in Hawaii
- Six new partners added to the
Allpoint+ cash deposit network during Q1 2021
Proposed Transaction with NCR
Corporation and Upcoming Investor Communications
As previously announced on January 25, 2021, the
Company entered into an acquisition agreement with NCR Corporation
("NCR") pursuant to which NCR will acquire all outstanding shares
of Cardtronics for $39.00 per share in cash. The transaction, which
has been approved by the board of directors of both companies, is
expected to close in mid-2021, subject to the satisfaction of
customary closing conditions, including regulatory approvals.
Cardtronics shareholders approved the transaction on May 7, 2021.
In light of the pending transaction, Cardtronics is not holding
quarterly earnings conference calls but is issuing this quarterly
earnings release and is providing additional financial and business
information in an earnings supplement posted on the Company's
website.
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 Net Cash Provided by Operating Activities, Adjusted Free
Cash Flow, Net Debt 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.
About Cardtronics (Nasdaq:
CATM)
Cardtronics is the trusted leader in financial
self-service, enabling cash transactions at over 285,000 ATMs
across 10 countries in North America, Europe, Asia-Pacific, and
Africa. With our 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 retail-based surcharge-free ATM network, with over 55,000
locations. As champions of cash, Cardtronics converts digital
currency into physical cash, driving payments choice for businesses
and consumers alike. Learn more about Cardtronics by visiting
www.cardtronics.com and by following us on LinkedIn and
Twitter.
Contact Information
Investor RelationsBrad
Conrad832-308-4000ir@cardtronics.com |
Media RelationsLisa
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. Forward-looking statements can
be identified by words such as "project," "believe," "estimate,"
"expect," "future," "anticipate," "intend," "contemplate,"
"foresee," "would," "could," "plan," and similar expressions that
are intended to identify forward-looking statements, which are
generally not historical in nature. 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, 2020, as updated by the Company’s Quarterly
Report on Form 10-Q for the quarter ended March 31, 2021, 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
Net Cash Provided by Operating Activities, 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. In addition, Management presents Net Debt as a measure of
our financial condition. Management 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, financial condition 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 for management.
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 U.S. GAAP. Reconciliations of the
non-GAAP financial measures used herein to the most directly
comparable U.S. 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 net interest expense, 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), 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 U.S. 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 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 27.1% and 23.6% for the three months
ended March 31, 2021 and 2020, respectively. The non-GAAP tax
rates represent the U.S. 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 Net Cash Provided by Operating
Activities and Adjusted Free Cash Flow
Adjusted Net Cash Provided by Operating
Activities 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.
Adjusted Free Cash Flow is defined as Adjusted
Net Cash Provided by Operating Activities 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.
Net Debt
Net Debt represents the principal amount of
current and long-term debt outstanding less cash and cash
equivalents. The carrying value of current and long-term debt is
reconciled to the principal amount by adding the unamortized debt
issuance costs and discounts.
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 Months Ended
March 31, 2021 and 2020(In thousands,
excluding share, per share amounts, and
percentages)(Unaudited)
|
|
Three Months Ended |
|
|
March 31, |
|
|
2021 |
|
2020 |
|
% Change |
|
|
|
|
|
|
|
Revenues: |
|
|
|
|
|
|
ATM operating revenues |
|
$ |
255,018 |
|
|
|
$ |
291,799 |
|
|
|
(12.6)% |
ATM product sales and other revenues |
|
12,816 |
|
|
|
14,803 |
|
|
|
(13.4) |
Total revenues |
|
267,834 |
|
|
|
306,602 |
|
|
|
(12.6) |
Cost of revenues: |
|
|
|
|
|
|
Cost of ATM operating revenues (excludes depreciation, accretion,
and amortization of intangible assets reported separately
below) |
|
150,803 |
|
|
|
193,630 |
|
|
|
(22.1) |
Cost of ATM product sales and other revenues |
|
8,796 |
|
|
|
12,092 |
|
|
|
(27.3) |
Total cost of revenues |
|
159,599 |
|
|
|
205,722 |
|
|
|
(22.4) |
Operating expenses: |
|
|
|
|
|
|
Selling, general, and administrative expenses |
|
42,909 |
|
|
|
42,378 |
|
|
|
1.3 |
Restructuring expenses |
|
1,692 |
|
|
|
1,209 |
|
|
|
40.0 |
Acquisition related expenses |
|
1,440 |
|
|
|
— |
|
|
|
n/m |
Depreciation and accretion expense |
|
32,285 |
|
|
|
32,211 |
|
|
|
0.2 |
Amortization of intangible assets |
|
6,086 |
|
|
|
8,413 |
|
|
|
(27.7) |
Loss on disposal and impairment of assets |
|
353 |
|
|
|
921 |
|
|
|
(61.7) |
Total operating expenses |
|
84,765 |
|
|
|
85,132 |
|
|
|
(0.4) |
Income from operations |
|
23,470 |
|
|
|
15,748 |
|
|
|
49.0 |
Other expenses: |
|
|
|
|
|
|
Interest expense, net |
|
10,761 |
|
|
|
6,421 |
|
|
|
67.6 |
Amortization of deferred financing costs and note discount |
|
1,043 |
|
|
|
3,486 |
|
|
|
(70.1) |
Other expenses, net |
|
2,842 |
|
|
|
3,829 |
|
|
|
n/m |
Total other expenses |
|
14,646 |
|
|
|
13,736 |
|
|
|
6.6 |
Income before income
taxes |
|
8,824 |
|
|
|
2,012 |
|
|
|
338.6 |
Income tax expense
(benefit) |
|
2,951 |
|
|
|
(3,737 |
) |
|
|
n/m |
Effective tax rate |
|
33.4 |
|
% |
|
(185.7 |
) |
% |
|
|
Net income |
|
5,873 |
|
|
|
5,749 |
|
|
|
2.2 |
Net loss
attributable to noncontrolling interests |
|
(3 |
) |
|
|
(6 |
) |
|
|
n/m |
Net income attributable to
controlling interests and available to common shareholders |
|
$ |
5,876 |
|
|
|
$ |
5,755 |
|
|
|
2.1 |
|
|
|
|
|
|
|
Net income per common share –
basic |
|
$ |
0.13 |
|
|
|
$ |
0.13 |
|
|
|
|
Net income per common share –
diluted |
|
$ |
0.13 |
|
|
|
$ |
0.13 |
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares
outstanding – basic |
|
|
44,959,960 |
|
|
|
|
44,729,824 |
|
|
|
|
Weighted average shares
outstanding – diluted |
|
|
45,609,764 |
|
|
|
|
45,741,261 |
|
|
|
|
|
|
|
|
|
|
|
Condensed Consolidated Balance
SheetsAs of March 31, 2021 and
December 31, 2020(In thousands)
|
|
March 31, 2021 |
|
December 31, 2020 |
|
|
(Unaudited) |
|
|
ASSETS |
|
|
|
|
Current assets: |
|
|
|
|
Cash and cash equivalents |
|
$ |
197,363 |
|
|
$ |
174,242 |
|
Accounts and notes receivable, net |
|
87,770 |
|
|
89,867 |
|
Inventory, net |
|
6,210 |
|
|
6,598 |
|
Restricted cash |
|
141,859 |
|
|
137,353 |
|
Prepaid expenses, deferred costs, and other current assets |
|
50,338 |
|
|
53,953 |
|
Total current assets |
|
483,540 |
|
|
462,013 |
|
Property and equipment,
net |
|
412,861 |
|
|
429,842 |
|
Operating lease assets |
|
56,434 |
|
|
60,368 |
|
Intangible assets, net |
|
75,250 |
|
|
84,629 |
|
Goodwill |
|
760,811 |
|
|
759,102 |
|
Deferred tax assets, net |
|
17,774 |
|
|
17,382 |
|
Prepaid expenses, deferred
costs, and other noncurrent assets |
|
23,188 |
|
|
18,109 |
|
Total assets |
|
$ |
1,829,858 |
|
|
$ |
1,831,445 |
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS’ EQUITY |
|
|
|
|
Current liabilities: |
|
|
|
|
Current portion of long-term
debt |
|
$ |
5,000 |
|
|
$ |
5,000 |
|
Current portion of other long-term liabilities |
|
51,744 |
|
|
64,799 |
|
Accounts payable and other accrued liabilities |
|
419,068 |
|
|
406,186 |
|
Total current liabilities |
|
475,812 |
|
|
475,985 |
|
Long-term liabilities: |
|
|
|
|
Long-term debt |
|
772,693 |
|
|
773,177 |
|
Asset retirement obligations |
|
56,859 |
|
|
56,973 |
|
Deferred tax liabilities, net |
|
55,471 |
|
|
51,484 |
|
Operating lease liabilities |
|
53,681 |
|
|
56,683 |
|
Other long-term liabilities |
|
21,886 |
|
|
37,727 |
|
Total liabilities |
|
1,436,402 |
|
|
1,452,029 |
|
Shareholders' equity |
|
393,456 |
|
|
379,416 |
|
Total liabilities and shareholders’ equity |
|
$ |
1,829,858 |
|
|
$ |
1,831,445 |
|
|
|
|
|
|
|
|
|
|
Selected Balance Sheet Detail:
Current and Long-Term
Debt: |
|
March 31, 2021 |
|
December 31, 2020 |
|
|
(In thousands) |
|
|
(Unaudited) |
|
|
Revolving credit facility due September 2024 |
|
$ |
— |
|
|
|
$ |
— |
|
|
Term Loan Facility due June
2027 (1) |
|
480,339 |
|
|
|
480,985 |
|
|
5.50% Senior Notes due May
2025 (2) |
|
297,354 |
|
|
|
297,192 |
|
|
Total Current and Long-term
Debt |
|
777,693 |
|
|
|
778,177 |
|
|
Less: Current portion |
|
(5,000 |
) |
|
|
(5,000 |
) |
|
Total Long-term debt |
|
$ |
772,693 |
|
|
|
$ |
773,177 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Debt: |
|
March 31, 2021 |
|
December 31, 2020 |
|
|
(In thousands) |
|
|
(Unaudited) |
|
|
Total Current and Long-term Debt |
|
$ |
777,693 |
|
|
|
$ |
778,177 |
|
|
Add: Unamortized discounts and
capitalized debt issuance costs |
|
18,557 |
|
|
|
19,323 |
|
|
Less: Cash and cash
equivalents |
|
(197,363 |
) |
|
|
(174,242 |
) |
|
Net Debt |
|
$ |
598,887 |
|
|
|
$ |
623,258 |
|
|
(1) |
The Term Loan Facility due June 2027 (the "Term Loan") with a face
value of $496.3 million and $497.5 million as of March 31,
2021 and December 31, 2020, respectively, is presented net of
unamortized discounts and capitalized debt issuance costs of
$16.0 million and $16.5 million as of March 31, 2021 and
December 31, 2020, respectively. Mandatory payments in the next
twelve months total $5.0 million and are presented in the Current
portion of long-term debt line of the Company's Consolidated
Balance Sheet as of March 31, 2021 and December 31, 2020. |
|
|
(2) |
The 5.50% Senior Notes due May 2025 with a face value of
$300.0 million are presented net of unamortized capitalized
debt issuance costs of $2.6 million and $2.8 million as of
March 31, 2021 and December 31, 2020, respectively. |
|
|
Reconciliation of Net Income Attributable
to Controlling Interests and Available to Common
Shareholders to EBITDA, Adjusted EBITDA, and Adjusted Net
IncomeFor the Three Months Ended March 31,
2021 and 2020(Unaudited)
|
|
Three Months Ended |
|
|
March 31, |
|
|
2021 |
|
2020 |
Net income attributable to controlling interests and
available to common shareholders |
|
$ |
5,876 |
|
|
$ |
5,755 |
|
|
Adjustments: |
|
|
|
|
Interest expense, net |
|
10,761 |
|
|
6,421 |
|
|
Amortization of deferred financing costs and note discount |
|
1,043 |
|
|
3,486 |
|
|
Income tax expense (benefit) |
|
2,951 |
|
|
(3,737 |
) |
|
Depreciation and accretion expense |
|
32,285 |
|
|
32,211 |
|
|
Amortization of intangible assets |
|
6,086 |
|
|
8,413 |
|
|
EBITDA |
|
$ |
59,002 |
|
|
$ |
52,549 |
|
|
|
|
|
|
|
Add back: |
|
|
|
|
Loss on disposal and impairment of assets |
|
353 |
|
|
921 |
|
|
Other expenses, net (1) |
|
2,842 |
|
|
3,829 |
|
|
Noncontrolling interests (2) |
|
15 |
|
|
13 |
|
|
Share-based compensation expense |
|
4,258 |
|
|
5,193 |
|
|
Restructuring expenses (3) |
|
1,692 |
|
|
1,209 |
|
|
Acquisition related expenses (4) |
|
1,440 |
|
|
— |
|
|
Adjusted
EBITDA (5) |
|
$ |
69,602 |
|
|
$ |
63,714 |
|
|
Less: |
|
|
|
|
Depreciation and accretion expense (6) |
|
32,285 |
|
|
32,210 |
|
|
Interest expense, net |
|
10,761 |
|
|
6,421 |
|
|
Adjusted pre-tax income |
|
26,556 |
|
|
25,083 |
|
|
Income tax expense (7) |
|
7,197 |
|
|
5,920 |
|
|
Adjusted Net
Income |
|
$ |
19,359 |
|
|
$ |
19,163 |
|
|
|
|
|
|
|
Adjusted Net Income
per share – basic |
|
$ |
0.43 |
|
|
$ |
0.43 |
|
|
Adjusted Net Income
per share – diluted |
|
$ |
0.42 |
|
|
$ |
0.42 |
|
|
|
|
|
|
|
Weighted average shares
outstanding – basic |
|
|
44,959,960 |
|
|
|
44,729,824 |
|
|
Weighted average shares
outstanding – diluted |
|
|
45,609,764 |
|
|
|
45,741,261 |
|
|
(1) |
Includes foreign currency translation gains/losses, the revaluation
of the estimated acquisition related contingent consideration, and
other non-operating costs. |
(2) |
Noncontrolling interest adjustment made such that Adjusted EBITDA
includes only the Company’s ownership interest in the Adjusted
EBITDA of one of the Company's Mexican subsidiaries. |
(3) |
For the three months ended March 31, 2021, restructuring expenses
included costs incurred in conjunction with facility closures,
workforce reductions and other related charges. For the three
months ended March 31, 2020, restructuring expenses included
professional fees and costs incurred in conjunction with facility
closures and workforce reductions. The facility closures during the
three months ended March 31, 2021 and 2020, respectively, primarily
occurred in the U.K. related to reducing the number of facilities
associated with cash delivery operations. |
(4) |
For the three months ended March 31, 2021, acquisition related
expenses includes legal and professional fees and certain
administrative costs incurred in connection with the proposed
acquisition of the Company, as further discussed in Note 1. Basis
of Presentation - (a) Description of Business. |
(5) |
The results for the three months ended March 31, 2021 include
business rate tax recoveries of $12.0 million, classified as a cost
reduction within Cost of ATM operating revenues. |
(6) |
Amounts exclude a portion of the expenses incurred by one of the
Company's Mexican subsidiaries to account for the amounts allocable
to the noncontrolling interest shareholders. |
(7) |
For the three month periods ended March 31, 2021 and 2020, the
non-GAAP tax rates used to calculate Adjusted Net Income were 27.1%
and 23.6%. The non-GAAP tax rates represent the Company’s U.S. GAAP
tax rates 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 Months
Ended March 31, 2021 and 2020(In thousands,
excluding percentages)(Unaudited)
Consolidated revenue: |
|
|
Three Months Ended |
|
|
March 31, |
|
|
2021 |
|
2020 |
|
% Change |
|
|
U.S. GAAP |
|
Foreign Currency Impact |
|
Constant - Currency |
|
U.S. GAAP |
|
U.S. GAAP |
|
Constant - Currency |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ATM operating revenues |
|
$ |
255,018 |
|
|
$ |
(7,306 |
) |
|
|
$ |
247,712 |
|
|
$ |
291,799 |
|
|
(12.6 |
) |
% |
|
|
(15.1 |
) |
% |
ATM product sales and other
revenues |
|
12,816 |
|
|
(401 |
) |
|
|
12,415 |
|
|
14,802 |
|
|
(13.4 |
) |
|
|
|
(16.1 |
) |
|
Total revenues |
|
$ |
267,834 |
|
|
$ |
(7,707 |
) |
|
|
$ |
260,127 |
|
|
$ |
306,601 |
|
|
(12.6 |
) |
% |
|
|
(15.2 |
) |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Gross Profit Inclusive
of Depreciation, Accretion, and Amortization of
Intangible Assets to Adjusted Gross ProfitFor the
Three Months Ended March 31, 2021 and 2020
(In thousands, excluding
percentages)(Unaudited)
|
|
Three Months Ended |
|
|
March 31, |
|
|
2021 |
|
2020 |
Total revenues |
|
$ |
267,834 |
|
|
$ |
306,602 |
|
Total cost of revenues
(1) |
|
159,599 |
|
|
205,722 |
|
Total depreciation, accretion,
and amortization of intangible assets excluded from total cost of
revenues |
|
31,961 |
|
|
31,194 |
|
Gross profit (inclusive of depreciation, accretion, and
amortization of intangible assets) |
|
76,274 |
|
|
69,686 |
|
Gross Margin (inclusive of depreciation, accretion, and
amortization of intangible assets) |
|
28.5 |
% |
|
22.7 |
% |
Total depreciation, accretion,
and amortization of intangible assets excluded from gross
profit |
|
31,961 |
|
|
31,194 |
|
Adjusted Gross Profit (exclusive of depreciation, accretion, and
amortization of intangible assets) |
|
$ |
108,235 |
|
|
$ |
100,880 |
|
Adjusted Gross Margin
(exclusive of depreciation, accretion, and amortization of
intangible assets) |
|
40.4 |
% |
|
32.9 |
% |
(1) |
The Company presents the Total cost of revenues in the Company’s
Consolidated Statements of Operations exclusive of depreciation,
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 Months Ended
March 31, 2021 and 2020(In thousands,
excluding per share amounts and
percentages)(Unaudited)
|
|
Three Months Ended |
|
|
March 31, |
|
|
2021 |
|
2020 |
|
% Change |
|
|
Non -
GAAP (1) |
|
Foreign Currency Impact |
|
Constant - Currency |
|
Non -
GAAP (1) |
|
Non -
GAAP (1) |
|
Constant - Currency |
Adjusted EBITDA |
|
$ |
69,602 |
|
|
$ |
(2,086 |
) |
|
|
$ |
67,516 |
|
|
$ |
63,714 |
|
|
9.2 |
% |
|
6.0 |
|
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Net Income |
|
$ |
19,359 |
|
|
$ |
(522 |
) |
|
|
$ |
18,837 |
|
|
$ |
19,163 |
|
|
1.0 |
% |
|
(1.7 |
) |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Net Income per share
– diluted (2) |
|
$ |
0.42 |
|
|
$ |
— |
|
|
|
$ |
0.42 |
|
|
$ |
0.42 |
|
|
0.0 |
% |
|
0.0 |
|
% |
(1) |
As reported on the schedule entitled Reconciliation of Net Income
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 45,609,764 and 45,741,261 for the three months ended
March 31, 2021 and 2020. |
Reconciliation of Net Cash Provided by
Operating Activities to Adjusted Net Cash Provided
by Operating Activities and Adjusted Free Cash
FlowFor the Three Months Ended March 31, 2021
and 2020 (In
thousands)(Unaudited)
|
|
Three Months Ended |
|
|
March 31, |
|
|
2021 |
|
2020 |
Net cash provided by operating activities |
|
$ |
69,352 |
|
|
|
$ |
1,120 |
|
|
Restricted cash settlement
activity (1) |
|
(4,346 |
) |
|
|
39,871 |
|
|
Adjusted net cash provided by
operating activities |
|
65,006 |
|
|
|
40,991 |
|
|
Net cash used in investing
activities, excluding acquisitions (2) |
|
(16,246 |
) |
|
|
(18,429 |
) |
|
Adjusted free cash flow |
|
$ |
48,760 |
|
|
|
$ |
22,562 |
|
|
(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. These
amounts can fluctuate significantly period to period based on the
number of days for which settlement to the merchant has not yet
occurred or day of the week on which a quarter ends. |
|
|
(2) |
Capital expenditure amounts include payments made for property and
equipment, 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. |
|
|
Cardtronics is a registered trademark of
Cardtronics plc and its subsidiaries.All other trademarks are the
property of their respective owners.
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