USA Technologies, Inc. (NASDAQ: USAT) announced today customer
feedback and latest performance data indicate that the adoption of
cashless payment technology is accelerating.
The Company recently announced that it had increased the number
of devices connected to its network by approximately 9,000 during
the quarter ended June 30, 2010, bringing the total number of
devices connected at June 30, 2010 to over 82,000, compared to
approximately 52,000 as of June 30, 2009. In addition, USA
Technologies added approximately 150 new customers to its ePort
Connect Service during the three months ended June 30, 2010,
bringing the total number of customers using the Company’s cashless
technology to approximately 1,050.
The Company believes the acceleration is based in part on the
fact that vending operators using the USAT cashless solution are
recognizing the positive impact that cashless vending is having on
sales, margins and net operating profit. Also, their customers are
often requesting cashless payment systems during contract
negotiations in order to bring another level of convenience to
their consumers.
“Cashless vending technology is the main enabler that will drive
profit back into our business, and the vending industry,” said
Southern Refreshment Services President, Dan Hart.
Southern Refreshment Services was an early adopter of the
Company’s ePort cashless system.
Since 2005, when Southern Refreshments first installed cashless
technology, annual cashless sales per machine have more than
doubled to $1,816, while top-performing machines are now averaging
$2,249.
Results from 41,000 traditional vending machines (beverage, food
and snack) connected to the USALive Network over the latest
18-month period, showed that vending machines were averaging $1,508
in annual credit/debit card purchases, and that the top 10,000
vending machines were averaging $2,973 in cashless sales
annually.
“USA Technologies’ performance data for the 41,000 machines
indicates that cashless has risen to 21 percent of all sales for
the latest 18-month period, and to 26 percent for the top 10,000
machines. This represents a six percent increase over the prior
18-month period for the same 41,000 machines,” said Jim Turner, VP,
ePort Deployment, USA Technologies.
Various vending operators and bottlers have indicated that total
sales revenue has grown by 15 percent per machine within a year or
two after installing cashless payment terminals in that machine.
Various channels in education, business and entertainment are
recording cashless transactions totaling more than 30 percent of
all purchases while in the military market, average cashless
transactions are over 50 percent.
“Southern Refreshments is averaging $3,000 a year in cashless
sales per machine in our education account,” said Tom Beals,
Southern Refreshment Director of Operations. “We believe that in
the next five years every Southern cashless enabled machine will go
to 50 percent cashless usage,” he said.
Southern Refreshment reported that college snack machines were
already showing 44 percent cashless usage, while its vending
machines at the Georgia World Congress Convention Center are at 59
percent. Southern Refreshment’s vending machines at hospitals and
banks were showing credit/debit sales at 25 percent cashless
usage.
Turner also indicated that USA Technologies is able to project
an operator’s estimated net operating profit which would be
generated by cashless vending. “Our access to tens of millions of
transactions and vast experience in the vending industry puts us in
the position to use an operator’s current business model to predict
the impact of cashless vending on their net operating profit, by
customer and right down to individual machines. Assuming a net
operating profit of approximately 10%-20% for cashless across an
operator’s total cashless business, versus the current industry
average of only 2% for all cash sales, the case for cashless is
compelling.
“Some of our customers are telling us that they already see the
day when half of all purchases made in vending machines, kiosks and
unattended point-of-sale terminals will be cashless,” concluded Mr.
Turner.
The Company expects to have 100,000 devices connected to the
ePort Connect Service by December 31, 2010.
About USA
Technologies:
USA Technologies is a leader in the networking of wireless
non-cash transactions, associated financial/network services and
energy management. USA Technologies provides networked credit card
and other non-cash systems in the vending, commercial laundry,
hospitality and digital imaging industries. The Company has been
granted 77 patents and has agreements with AT&T, Visa, Compass
and others. Visit our website at www.usatech.com.
Statement under the Private
Securities Litigation Reform Act:
With the exception of the historical information contained in
this release, the matters described herein contain forward-looking
statements that involve risk and uncertainties that may
individually or mutually impact the matters herein described,
including but not limited to, product acceptance, the ability to
continually obtain increased orders of its products, the ability to
meet installation goals, economic, competitive, governmental
impacts, whether pending patents will be granted or defendable if
granted, validity of its intellectual property and patents, whether
our shares or publicly traded warrants would continue to meet the
eligibility requirements for continued listing on the NASDAQ Stock
Market, LLC; the ability to commercialize developmental products,
as well as technological and/or other factors. 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, the Company 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.
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