MIAMI, Aug. 20, 2013 (GLOBE NEWSWIRE) -- Net Element International (Nasdaq:NETE), a technology-driven group specializing in electronic commerce and mobile payment processing, today announced financial results for its second-quarter ended June 30, 2013. Net Element International reported second-quarter net revenues of $5,615,719, which represents a significant increase over net revenues of $37,818 from the same period in the prior year as a result of completion of Unified Payments acquisition in the second-quarter of 2013. General & Administrative expenses for second-quarter 2013 were $3,807,913 as compared to General & Administrative expenses of $2,443,387 (as restated) one year previously, representing a 56 percent increase. Net loss for the quarter was $20,231,697, or $(0.72) per share, as compared to a net loss of $2,573,263 (as restated), or $(0.13) per share — representing a 686 percent increase in loss over the second quarter last year. The increased loss was driven primarily by non-cash impairments, which were necessary to clean up company's financials and set a strong foundation for growth. Goodwill impairment (non-cash) for the second-quarter was $11.2 million, in addition company recorded a $5,792,487 provision for loan losses. Additional information regarding Net Element International's results of operations for its second-quarter ended June 30, 2013 may be found in Net Element International's quarterly report on Form 10-Q, which was filed with the Securities and Exchange Commission (SEC) on August 19, 2013 and may be obtained from the SEC's Internet website at http://www.sec.gov.
Other highlights for the quarter include:
"In second quarter we were focused on the completion of strategic acquisitions, pursuing market expansion opportunities, creating stronger financial foundation and assembling a strong executive management team in Russia," said Oleg Firer, CEO of Net Element. "With this completed, along with the full integration of Unified Payments, we are now positioned for the growth that these initiatives will make possible".
Net Element will host a conference call on August 22, 2013 at 8:30 a.m. Eastern Time to discuss the financial and business highlights. The conference call can be accessed by dialing 800-514-8534 (domestic) or 408-940-3842 (international). Participants will need to provide the passcode 35524518. A telephonic replay will be available approximately three hours after the call and can be accessed by dialing 855-859-2056, or for international callers, 1-404-537-3406. The passcode for the live call and the replay is 35524518. The telephonic replay will be available until 11:59 pm (Eastern Time) on August 25, 2013.
About Net Element International (Nasdaq:NETE)
Net Element International (Nasdaq:NETE) is a global technology-driven group specializing in electronic commerce, mobile payments and transactional services. The company owns and operates a global mobile payments and transaction processing provider, TOT Group, as well as several popular content monetization verticals. Together with its subsidiaries, Net Element International enables ecommerce and content-management companies to monetize their assets in ecommerce and mobile commerce environments. Its global development centers and high-level business relationships in the United States, Russia and Commonwealth of Independent States strategically position the company for continued growth. The company has U.S. headquarters in Miami and international headquarters in Moscow. More information is available at www.netelement.com.
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Any statements contained in this press release that are not statements of historical fact may be deemed forward-looking statements. Words such as "will," "may," "could," "should," "expect," "expected," "plans," "intend," "anticipate," "believe," "estimate," "predict," "potential," and similar expressions are intended to identify such forward-looking statements. These forward-looking statements include, without limitation, the extent that being added to the Russell Indexes will elevate Net Element International's profile in the investor community or bring its strategy and shareholder value to the attention of a broader audience; whether being added to the Russell Indexes will add liquidity to Net Element International's stock; whether being added to the Russell Indexes will attract index funds; and whether Net Element International or its business continues to grow. All forward-looking statements involve significant risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the forward-looking statements, many of which are generally outside the control of Net Element International and are difficult to predict. Examples of such risks and uncertainties include, but are not limited to: (i) Net Element International's ability (or inability) to obtain additional financing in sufficient amounts or on acceptable terms when needed; (ii) Net Element International's ability to maintain existing, and secure additional, contracts with users of its payment processing services; (iii) Net Element International's ability to successfully expand in existing markets and enter new markets; (iv) Net Element International's ability to successfully manage and integrate any acquisitions of businesses, solutions or technologies; (v) unanticipated operating costs, transaction costs and actual or contingent liabilities; (vi) the ability to attract and retain qualified employees and key personnel; (vii) adverse effects of increased competition on Net Element International's business; (viii) changes in government licensing and regulation that may adversely affect Net Element International's business; (ix) the risk that changes in consumer behavior could adversely affect Net Element International's business; (x) Net Element International's ability to protect its intellectual property; and (xi) local, industry and general business and economic conditions. Additional factors that could cause actual results to differ materially from those expressed or implied in the forward-looking statements can be found in the most recent annual report on Form 10-K and the subsequently filed quarterly reports on Form 10-Q and current reports on Form 8-K filed by Net Element International with the Securities and Exchange Commission. Net Element International anticipates that subsequent events and developments may cause its plans, intentions and expectations to change. Net Element International assumes no obligation, and it specifically disclaims any intention or obligation, to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by law.
|NET ELEMENT INTERNATIONAL|
|UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE LOSS|
|Three months ended June 30,||Six months ended June 30,|
|2013||2012 (As Restated)||2013||2012 (As Restated)|
|Costs and expenses:|
|Cost of revenues||4,151,955||100,154||4,427,421||199,781|
|General and administrative (includes $118,650 and $732,102 and $118,647 and $3,393,874 of non cash compensation for quarters ended June 30, 2013 and 2012, respectively)||3,807,913||2,443,387||6,876,238||6,462,092|
|Provision for unrecoverable advances||5,792,487||--||6,199,072||--|
|Depreciation and amortization||625,987||119,678||669,063||188,341|
|Total costs and operating expenses||25,578,342||2,663,219||29,371,794||6,850,214|
|Loss from operations||(19,962,623)||(2,625,401)||(22,881,560)||(6,737,586)|
|Net loss from operations||(20,839,045)||(2,697,128)||(24,089,092)||(7,293,212)|
|Net loss attributable to the noncontrolling interest||607,348||123,865||623,564||195,953|
|Foreign currency translation loss||(238,685)||(8,977)||(264,758)||(8,876)|
|Comprehensive loss||$(20,470,382)||$(2,582,240)||$ (23,730,286)||$ (7,106,135)|
|Net loss per share - basic and diluted||$(0.72)||$(0.13)||(0.83)||(0.37)|
|Weighted average number of common shares outstanding - basic and diluted||28,133,699||19,115,616||28,178,805||18,967,715|
MEDIA CONTACT: Dan Bruck (305) 507-8808 www.netelement.com
Net Element International
North Miami Beach, Florida, UNITED STATES
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