HOUSTON, May 15, 2006 (PRIMEZONE) -- Cardtronics, Inc. ("Cardtronics" or the "Company"), the world's largest independent owner/operator of ATMs, today announced its preliminary financial results for the quarter ended March 31, 2006.
First Quarter Results
Financial information:
For the first quarter of 2006, revenues totaled $69.1 million, representing an 18.5% increase over the $58.3 million in revenues recorded during the first quarter of 2005. The year-over-year increase in revenues was primarily due to acquisitions consummated during 2005, including the BAS Communications, Inc. ATM portfolio in March 2005, the Neo Concepts, Inc. ATM portfolio in April 2005, and Bank Machine Limited in the United Kingdom in May 2005.
Adjusted EBITDA, which represents EBITDA adjusted for certain items as provided for by the Company's bank credit facility, totaled $11.5 million for the first quarter of 2006, representing a 23.7% increase over the $9.3 million in Adjusted EBITDA for the same period in 2005. The increase in Adjusted EBITDA was primarily due to the year-over-year revenue growth resulting from the Company's various acquisitions during the past year, as highlighted above, and by continued growth in the Company's bank and network branding revenues. These increases were partially offset by cost increases in certain areas, including higher vault cash rental costs resulting from higher interest rates and higher selling, general and administrative costs resulting from the Company's growth.
Adjusted EBITDA is a non-GAAP measure of financial performance. We are required by the terms of our bank credit facility to comply with certain covenants that are based on it.
Key Statistics:
Average transacting ATMs for the first quarter of 2006 totaled 26,207, representing an increase of 6.3% when compared to the 24,661 average transacting ATMs during the same period in 2005. Cash withdrawal transactions increased 14.5% to 30.0 million during the first quarter of 2006 from 26.2 million during the same period in 2005. Such increases were primarily due to the acquisitions consummated during 2005, as previously discussed, the continued roll out of company-owned ATMs in Walgreens and CVS locations in the United States, and increases in withdrawals experienced at bank and network branded locations.
Average cash withdrawal transactions per ATM per month during the first quarter of 2006 increased 7.3% to 381 from 355 during the same period in 2005. This increase was primarily due to the acquisition of Bank Machine Limited in the United Kingdom in May 2005, which has higher average transaction volumes than the Company's domestic operations. Average revenues per ATM per month in the first quarter of 2006 increased 11.3% to $844 from $758 in the same period in 2005, due to the Bank Machine acquisition and the growth of the Company's bank and network branding revenues in the United States. Capital expenditures during the quarter were $4.2 million.
"We are very pleased with our results for this past quarter and are currently on pace to achieve the key goals that we have set for the Company for the remainder of the year," remarked Jack Antonini, Chief Executive Officer of Cardtronics. "In particular, the signing of several new bank and network branding agreements during the quarter is indicative of the momentum that we are starting to see with respect to that initiative. Additionally, we are excited about the opportunities that we are seeing on the international front. Our U.K. operations continued to show solid growth during the past quarter through the roll out of new ATMs under existing contracts with multi-unit retailers. In Mexico, we believe that we are well positioned, through our majority ownership position in that country's largest independent ATM operator, to capitalize on the anticipated growth in off-premise ATMs as a result of Mexico's recent decision to allow surcharging."
Key Highlights
Recent key highlights include the following:
-- The continued growth of Allpoint, the Company's surcharge-free ATM
network. Allpoint continued to show impressive growth during the
quarter, adding a number of well-known credit unions to its portfolio
of participating financial institutions, including the Texas Dow
Employees Credit Union and Affinity Federal Credit Union, New Jersey's
largest credit union. Allpoint's participating financial institutions
serve 2.7 million cardholders.
-- The execution of several new and significant bank branding agreements,
including:
-- Two agreements with Sovereign Bank to brand up to
1,363 ATMs in CVS Pharmacy locations in Massachusetts,
New Jersey, Connecticut, New Hampshire, and New York;
-- Two agreements with HSBC Bank USA to brand 93 ATMs in
Walgreens locations in northern New Jersey and
Connecticut;
-- An agreement with BB&T Corporation to brand 65 ATMs
in Walgreens locations in the Atlanta, Georgia area;
-- An agreement with a major bank to brand 340 ATMs in a
Southeastern state.
It should be noted that a substantial portion of the above locations do not currently have installed ATMs. However, the new installations will be completed during the remainder of 2006 and were previously contemplated in the Company's 2006 capital budgeting process. At the end of 2005, the Company had 920 ATMs operating under bank branding agreements. The new agreements listed above bring the total number of ATMs under bank branding agreements, once installed, to over 2,300 ATMs.
-- The successful extension of a contract with one of the Company's
largest customers in the convenience store industry, covering
approximately 500 locations, for an additional 7 years.
Guidance for 2006
The Company continues to expect revenues of $270-290 million and Adjusted EBITDA of $46 million to $50 million for the year ending December 31, 2006.
Financial Results Subject to Adjustment
As of the date of this release, the Company has not been able to issue its audited financial statements for the year ended December 31, 2005, or its unaudited interim financial statements for the quarter ended March 31, 2006. The Company has been working through a series of accounting issues with the Securities and Exchange Commission and its independent public accountants that have arisen in connection with the filing of the Company's registration statement on Form S-4 and as part of the Company's annual audit process. Accordingly, the financial information presented in this press release is preliminary and subject to adjustment. Based on comments and conversations to date, any adjustments arising from these issues are not expected to have a material impact, if any, on cash, debt, EBITDA, Adjusted EBITDA, or working capital items, because the issues under discussion primarily relate to such matters as noncash amortization expense and stock compensation charges. However, the time required to resolve these issues has caused a considerable delay in the Company's year-end and quarterly reporting processes.
The timely provision of audited financial statements is a requirement under the Company's bank credit agreement. In March, the Company obtained a waiver from its bank group that extended the date by which the Company's year-end 2005 audited financial statements must be provided to its banks to June 30, 2006. The Company is currently in compliance with the bank credit agreement provisions requiring it to provide unaudited interim financial information for all periods subsequent to December 31, 2005.
The indenture governing the Company's 9-1/4% Senior Subordinated Notes due August 12, 2013, also contains provisions requiring the timely provision of audited annual and unaudited interim financial information. If such information is not provided on a timely basis, the trustee or 25% of the bondholders have the right to give the Company notice that it has not met such reporting requirements, and if the requirements are not met within 60 days of receipt of such notice, the Company would be in default of this provision of the indenture, which would give bondholders the right to demand repayment of their notes. The Company has made extensive efforts to communicate clearly with the trustee and its bondholders regarding the aforementioned reporting issues, and no such notice has been received by the Company as of the date of this release.
The financial information presented in this press release does not include the potential effects of any adjustments as a result of the ongoing audit of our financial statements for the year ended December 31, 2005. Because the preparation, completion, and independent audit of the Company's financial statements in connection with its annual report and the preparation and completion of the Company's quarterly financial statements in connection with its quarterly report are ongoing, the financial information presented in this press release is preliminary and subject to adjustment, which adjustment could be material.
Non-GAAP Financial Information
Adjusted EBITDA is not intended to represent cash flows from operations as defined by GAAP in the United States and should not be used as an alternative to net income as an indicator of operating performance or to cash flow as a measure of liquidity. While EBITDA is frequently used as a measure of operating performance and the ability to meet debt service requirements, it is not necessarily comparable to other similarly titled captions of other companies due to potential inconsistencies in the methods of calculation. Adjusted EBITDA, as presented herein, is calculated in the manner similar to that in our bank credit facility and, as such, is not comparable to other similarly titled captions of other companies. The Company believes that referencing Adjusted EBITDA will be helpful to our investors, as we believe it is used by the lenders under our bank credit facility in their evaluation of the Company.
Cautionary Note Regarding Forward-Looking Statements
The information in this press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements give our current expectations or forecasts of future events, future financial performance, strategies, expectations, competitive environment, regulation and availability of resources. They include, among other things, proposed new programs; expectations that regulatory developments or other matters will not have a material adverse effect on our consolidated financial position, results of operations or liquidity; trends within the ATM industry; statements concerning projections, predictions, expectations, estimates or forecasts as to our business, financial and operational results and future economic performance; and statements of management's goals and objectives and other similar expressions concerning matters that are not historical facts. Such statements are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements, including risks and uncertainties relating to reliance on third parties for cash management services; increased regulation and regulatory uncertainty; trends in ATM usage; decreases in the number of ATMs we can place with our top merchants; increased industry competition; our ability to continue to execute our growth strategies; risks associated with the acquisition of other ATM networks; changes in interest rates; declines in, or system failures that interrupt or delay, ATM transactions; changes in the ATM transaction fees we receive; changes in ATM technology; changes in foreign currency rates; and general and economic conditions.
You should not read forward-looking statements as a guarantee of future performance or results. They will not necessarily be accurate indications of the times at or by which, such performance or results will be achieved. Forward-looking statements speak only as of the date the statements are made and are based on information available at the time those statements are made and/or management's good faith belief as of that time with respect to future events. We assume no obligation to update forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information.
About Cardtronics
Headquartered in Houston, Texas, Cardtronics is the world's largest owner/operator of ATMs with more than 25,000 locations. We operate in every major U.S. market, and at over 1,000 locations throughout the U.K. and over 200 locations in Mexico. Major merchant-clients include A&P(r), Albertson's(r), Amerada Hess(rRCardtronics, Inc. ("Cardtronics" or the "Company"), the world's largest independent owner/operator of ATMs, today announced its preliminary financial results for the quarter ended March 31, 2006.
The Cardtronics logo is available at http://www.primezone.com/newsroom/prs/?pkgid=991
Cardtronics, Inc. and Subsidiaries
Consolidated Statement of Adjusted EBITDA
Three Months Ended March 31, 2006 and 2005
(in thousands)
(unaudited)
Three Months Ended
March 31,
------------------------------
2006(a)(b) 2005(a)
--------------- -------------
Revenues:
ATM operating revenues $ 66,331 $ 56,072
ATM product sales and other revenues 2,811 2,192
----------- ----------
Total revenues 69,142 58,264
Adjusted cost of revenues:
Adjusted cost of ATM operating
revenues (excludes stock
compensation expense of $172
in 2005, and excludes other
adjustments to Adjusted EBITDA of
$42 and $92 in 2006 and 2005
respectively) 50,453 44,183
Cost of ATM product sales and other
revenues 2,599 1,960
----------- ------------
Total cost of revenues 53,052 46,143
Adjusted Gross profit 16,090 12,121
Adjusted operating expenses:
Adjusted selling, general and
administrative expenses
(excludes stock compen sation
expense of $69 and $1,832 in 2006
and 2005 respectively, and excludes
other adjustments to Adjusted
EBITDA of $124 and $65 in 2006 and
2005 respectively) 4,593 2,868
----------- ------------
Adjusted EBITDA $ 11,497 $ 9,253
============== ============
(a) The Company has not yet completed its restatement of prior
period results, including the quarterly and annual results
for 2005, as well as the completion of the quarterly reporting
for 2006. All such financial information is, therefore,
preliminary and remains subject to change.
(b) The 2006 quarterly results exclude the impact of any non-cash
stock compensation charges associated with the Company's
adoption of Statement of Financial Accounting Standards No.
123(R), Share-Based Payment, effective January 1, 2006.
Cardtronics, Inc. and Subsidiaries
Selected Balance Sheet Accounts
March 31, 2006 and December 31, 2005
(in thousands)
(unaudited)
March 31, December 31,
2006(a) 2005(a)
---------------- -------------------
Cash and cash equivalents $ 4,078 $ 1,699
Long-term debt $ 251,887 $ 244,456
(a) The Company has not yet completed its restatement of prior period
results, including the quarterly and annual results for 2005, as
well as the completion of the quarterly reporting for 2006. All
such financial information is, therefore, preliminary and remains
subject to change.
Cardtronics, Inc. and Subsidiaries
Key Operating Metrics
Three Months Ended March 31, 2006 and 2005
(unaudited)
Three Months Ended March 31,
---------------------------------
2006(a)(b) 2005(a)
--------------- --------------
Average number of transacting 26,207 24,661
Monthly withdrawal transactions
per ATM 381 355
Total withdrawal transaction 29,973,970 26,236,850
Total transactions 40,826,630 33,414,546
Per ATM amounts (per month):
Operating revenues $ 844 $ 758
Operating expenses 642 601
---------- ---------
ATM operating gross profit $ 202 $ 157
============== ===============
ATM operating gross margin 23.9% 20.7%
Capital expenditures,
excluding acquisitions (000's) $ 4,126 $ 6,324
(a) The Company has not yet completed its restatement of prior
period results, including the quarterly and annual results
for 2005, as well as the completion of the quarterly reporting
for 2006. All such financial information is, therefore,
preliminary and remains subject to change.
(b) The 2006 quarterly results exclude the impact of any non-cash
stock compensation charges associated with the Company's
adoption of Statement of Financial Accounting Standards
No. 123(R), Share-Based Payment, effective January 1, 2006.