EXHIBIT 99.1
HOUSTON, Nov. 8, 2006 (PRIMEZONE) -- Cardtronics, Inc. ("Cardtronics" or the "Company"), the world's largest owner/operator of ATMs, today announced its financial results for the quarter ended September 30, 2006.
THIRD QUARTER RESULTS
Financial Information
For the third quarter of 2006, revenues totaled $76.4 million, representing a 6.6% increase over the $71.7 million in revenues recorded during the third quarter of 2005. The Company's adjusted earnings before interest, taxes, depreciation and amortization ("EBITDA"), which represents EBITDA adjusted for certain items as provided for by the Company's bank credit facility, totaled $13.9 million for the third quarter of 2006, representing a 15.8% increase over the $12.0 million in adjusted EBITDA for the same period in 2005. The year-over-year increase in revenues was primarily attributable to an increase in ATM operating revenues in the Company's United Kingdom operations as a result of additional ATM deployments and higher withdrawal transactions per ATM when compared to the same period in 2005. The increase in adjusted EBITDA was primarily due to the growth in the Company's United Kingdom operations, as noted above, and year-over-year growth in the Company's bank and network branding programs. Such increa ses were partially offset by cost increases in certain areas, including higher selling, general and administrative costs resulting from the Company's year-over-year growth and various developmental activities.
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.
The Company recorded a net loss for the third quarter of 2006 of $0.3 million, which compares to a net loss of $2.9 million for the same period in 2005. The net loss in the third quarter of 2005 was the result of a pre-tax write-off of approximately $4.8 million in deferred financing costs associated with the repayment of the Company's term loans under its bank credit facilities.
Key Statistics
Average transacting ATMs for the third quarter of 2006 totaled 25,726, which represents a decrease of 2.5% when compared to the 26,379 average transacting ATMs during the same period in 2005. Such decrease was primarily due to a year-over-year decline in the number of merchant-owned ATMs transacting within the United States, offset slightly by ATM growth in the United Kingdom and Mexico. Cash withdrawal transactions increased 1.9% to 32.2 million during the third quarter of 2006 from 31.6 million during the same period in 2005. Such increase was primarily due to higher withdrawal transactions associated with the Company's United Kingdom operations and incremental withdrawal transactions associated with the Company's operations in Mexico, offset somewhat by lower year-over-year withdrawal transactions in the United States as a result of the aforementioned decline in merchant-owned ATMs.
Average cash withdrawal transactions per ATM per month during the third quarter of 2006 increased 4.5% to 418 from 400 during the same period in 2005. This increase was primarily due to increased activity from the Company's United Kingdom operations, which have higher average transaction volumes than the Company's domestic operations. Average revenues per ATM per month in the third quarter of 2006 increased 7.3% to $944 from $880 in the same period in 2005. Such increase was primarily due to growth in our United Kingdom operations and additional growth in the Company's domestic bank and network branding programs. Capital expenditures during the quarter totaled $14.7 million.
NINE MONTH RESULTS
Financial Information
Revenues totaled $218.8 million for the nine months ended September 30, 2006, representing an increase of 9.8% over the $199.2 million in revenues recorded during the first nine months of 2005. Adjusted EBITDA totaled $39.0 million for the nine months ended September 30, 2006, representing a 17.1% increase over the $33.3 million in adjusted EBITDA for the same period in 2005. The year-over-year increases in revenues and adjusted EBITDA were primarily driven by the Company's acquisition of Bank Machine Limited in May 2005, as well as continued growth in the number of ATMs and higher overall withdrawal transactions per ATM associated with the Company's United Kingdom operations. Additionally, increased revenues associated with the Company's bank and network branding programs contributed to the year-over-year increases in revenues and adjusted EBITDA.
The Company incurred a net loss of $2.7 million for the nine months ended September 30, 2006, compared to a net loss of $0.8 million for the same period in 2005. The increased loss in 2006 was primarily due to the additional interest, depreciation and amortization expense amounts associated with the Company's 2005 acquisitions, as well as higher operating and selling, general and administrative costs, as previously discussed.
Key Statistics
Average transacting ATMs for the nine months ended September 30, 2006 totaled 25,913, which represents a decrease of less than 1.0% when compared to the 26,086 average transacting ATMs during the same period in 2005. Cash withdrawal transactions increased 6.2% to 93.7 million for the nine months ended September 30, 2006 from 88.2 million during the same period in 2005. The relatively flat year-over-year ATM count was comprised of an increase in average transacting ATMs in the Company's United Kingdom and Mexico operations, offset by a decrease in the number of average transacting ATMs operating within the United States (primarily on the merchant-owned side of the business), as previously noted. The increase in year-to-date cash withdrawal transactions was primarily driven by the same factors that contributed to the quarterly year-over-year increase, as noted above, and the fact that the prior year withdrawal transactions for the Company's United Kingdom operations only included transactions subsequent to the May 2005 Bank Machine acquisition date.
Average cash withdrawal transactions per ATM per month for the nine months ended September 30, 2006 increased 6.9% to 402 from 376 during the same period in 2005. This increase was primarily due to the Company's United Kingdom operations, which have higher average transaction volumes than the Company's domestic operations and were in place for the full year-to-date period in 2006. Average revenues per ATM per month for the nine months ended September 30, 2006 increased 9.9% to $898 from $817 in the same period in 2005. Such increase was driven by the same factors that contributed to the quarterly year-over-year increase, as noted above. Capital expenditures during the nine months ended September 30, 2006 totaled $26.0 million.
"Our most recent quarterly results continue to reflect the achievement of the goals that we set for ourselves at the beginning of this year," commented Jack Antonini, Chief Executive Officer of Cardtronics. "Domestically, our financial results were positively impacted by the bank and network branding agreements that we executed earlier in the year. Internationally, our United Kingdom operations turned in another strong quarter, further validating the organic growth opportunities that we envisioned for that market when we purchased Bank Machine in 2005. Finally, the recent signing of an exclusive ATM operating agreement with OXXO, Latin America's largest convenience store operator, is clearly indicative of the types of opportunities that we feel exist throughout Mexico. In all, we are extremely pleased with our results thus far in 2006, and are optimistic about the prospects for future growth in all of our key operating segments."
KEY HIGHLIGHTS
Recent key highlights include the following:
-- The successful roll-out of over 1,000 Sovereign Bank branded
ATMs in CVS stores located throughout the northeast United
States.
-- The signing of a multi-year ATM operating agreement with OXXO,
Latin America's largest convenience store chain. OXXO currently
has over 4,300 convenience stores located throughout Mexico.
-- The signing of a multi-year bank branding agreement with
Washington Mutual to brand 160 ATMs in selected Walgreen's
locations in the United States.
-- The signing of nine Arizona credit unions with $3.4 billion in
assets under management to the Allpoint nationwide surcharge-free
network.
-- The successful exchange of the Company's previously issued 91/4%
senior subordinated notes for new 91/4% senior subordinated notes
that have been registered with the Securities and Exchange
Commission ("SEC"). The new notes have the same terms and
conditions as the Company's previously issued notes, except for
the fact that the new notes have been registered with the SEC and
can be publicly traded.
GUIDANCE FOR REMAINDER OF 2006
Based on the results achieved year-to-date, the Company is updating its earnings guidance for the year ending December 31, 2006. The Company now expects full-year revenues to be in the range of $285.0 to $295.0 million, up from the $280.0 to $290.0 million range that was communicated at the end of the previous quarter. Additionally, the Company expects its full-year adjusted EBITDA to be in the range of $51.0 to $53.0 million, up from the $48.0 to $52.0 million range communicated at the end of the previous quarter.
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, trends within the ATM industry; proposed new programs and initiatives; expectations that regulatory developments or other matters will not have a material adverse effect on our consolidated financial position, results of operations or liquidity; 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 in the markets in which we conduct our operations.
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 UK and over 300 locations in Mexico. Major merchant-clients include A&P(r), Albertson's(r), Amerada Hess(r), Barnes & Noble(r) College Bookstores, BP(r) Amoco, Chevron(r), Costco(r), CVS(r)/pharmacy, ExxonMobil(r), Duane Reade(r), Rite Aid(r), Sunoco(r), Target(r) and Walgreens(r). Cardtronics also works closely with financial institutions across the U.S., including Chase(r), HSBC(r), Sovereign Bank(r), Wachovia(r) and Washington Mutual(r), to brand ATMs in these major merchants and provide convenient access for their customers and the ability to preserve and expand their markets. For more information about Cardtronics, please visit http://www.cardtronics.com/.
The Cardtronics logo is available at http://www.primezone.com/newsroom/prs/?pkgid=991
Cardtronics, Inc. and Subsidiaries
Consolidated Statements of Operations
Three and Nine Months Ended September 30, 2006 and 2005
(in thousands)
(unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
------------------------------------------
2006 2005 2006 2005
--------- --------- --------- ---------
Revenues:
ATM operating revenues $ 72,887 $ 69,603 $ 209,542 $ 191,731
ATM product sales and
other revenues 3,478 2,131 9,218 7,457
Total revenues 76,365 71,734 218,760 199,188
Cost of revenues:
Cost of ATM operating
revenues 54,280 53,612 157,225 148,699
Cost of ATM product sales
and other revenues 3,105 2,173 8,142 6,976
--------- --------- --------- ---------
Total cost of revenues 57,385 55,785 165,367 155,675
Gross profit 18,980 15,949 53,393 43,513
Operating expenses:
Selling, general and
administrative expenses:
Stock-based compensation 240 131 600 2,070
Other selling, general
and administrative
expenses 5,571 4,381 15,109 11,142
Depreciation and
accretion expense 5,214 3,388 14,072 8,530
Amortization expense 2,263 1,980 9,610 5,689
--------- --------- --------- ---------
Total operating expenses 13,288 9,880 39,391 27,431
Income from operations 5,692 6,069 14,002 16,082
Other (income) expense:
Interest expense, net 5,871 4,741 17,193 10,010
Amortization and write-off
of deferred financing
costs and bond discount 362 5,453 1,576 6,584
Minority interest in
subsidiary (71) -- (128) 15
Other (income) loss (83) 435 (740) 867
--------- --------- --------- ---------
Total other expense 6,079 10,629 17,901 17,476
Loss before income taxes (387) (4,560) (3,899) (1,394)
Income tax benefit (60) (1,696) (1,217) (545)
--------- --------- --------- ---------
Net loss $ (327) $ (2,864) $ (2,682) $ (849)
========= ========= ========= =========
Cardtronics, Inc. and Subsidiaries
Consolidated Balance Sheets
As of September 30, 2006 and December 31, 2005
(in thousands)
(unaudited)
September 30, December 31,
2006 2005
--------- ---------
Assets
Current assets:
Cash and cash equivalents $ 475 $ 1,699
Accounts and notes receivable, net 12,455 9,746
Inventory 5,715 2,747
Prepaid, deferred costs, and other
current assets 10,289 4,244
Restricted cash, short-term 1,507 4,232
Deferred tax asset 835 1,105
--------- ---------
Total current assets 31,276 23,773
Restricted cash 34 33
Property and equipment, net 82,835 74,151
Intangible assets, net 68,215 75,965
Goodwill 167,756 161,557
Prepaid and other assets 4,798 8,272
--------- ---------
Total assets $ 354,914 $ 343,751
========= =========
Liabilities and Stockholders' Deficit
Current liabilities:
Notes payable and capital leases $ 145 $ 3,168
Current portion of other long-term
liabilities 2,180 2,251
Accounts payable and accrued
liabilities 45,285 42,438
--------- ---------
Total current liabilities 47,610 47,857
Long-term liabilities:
Long-term debt, net of current portion 252,850 244,456
Deferred tax liability 8,147 9,800
Other long-term liabilities and
minority interest in subsidiary 14,666 14,393
--------- ---------
Total liabilities 323,273 316,506
Redeemable preferred stock 76,528 76,329
Stockholders' deficit (44,887) (49,084)
--------- ---------
Total liabilities and stockholders'
deficit $ 354,914 $ 343,751
========= =========
Cardtronics, Inc. and Subsidiaries
Key Operating Metrics
Three and Nine Months Ended September 30, 2006 and 2005
(unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
2006 2005 2006 2005
------------ ------------ ------------ ------------
Average number
of
transacting
ATMs 25,726 26,379 25,913 26,086
Monthly
withdrawal
transactions
per ATM 418 400 402 376
Total withdrawal
transactions 32,241,478 31,619,519 93,734,691 88,220,743
Total
transactions 44,736,076 42,202,003 128,517,759 115,152,246
Per ATM amounts
(per month):
Operating
revenues $ 944 $ 880 $ 898 $ 817
Operating
expenses 703 677 674 633
------------ ------------ ------------ ------------
ATM operating
gross profit $ 241 $ 203 $ 224 $ 184
============ ============ ============ ============
ATM operating
gross margin 25.5% 23.1% 24.9% 22.5%
Capital
expenditures,
excluding
acquisitions
(000s) $ 14,725 $ 16,784 $ 26,021 $ 27,488
Cardtronics, Inc. and Subsidiaries
Reconciliation of Net Income (Loss) to EBITDA and Adjusted EBITDA
Three and Nine Months Ended September 30, 2006 and 2005
(unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
2006 2005 2006 2005
-------- -------- -------- --------
Net loss $ (327) $ (2,864) $ (2,682) $ (849)
Interest expense (including
amortization and
write-offs of deferred
financing costs and bond
discount) 6,233 10,194 18,769 16,594
Income tax benefit (60) (1,696) (1,217) (545)
Depreciation and accretion
expense 5,214 3,388 14,072 8,530
Amortization expense 2,263 1,980 9,610 5,689
-------- -------- -------- --------
EBITDA 13,323 11,002 38,552 29,419
Stock compensation expense
(includes amounts
reflected in cost of ATM
operating revenues) 255 131 635 2,242
Acquisition related
transition costs -- 325 110 721
Other (income) loss (a) (83) 435 (740) 867
Minority interest (17) -- (16) (15)
Other adjustments 413 55 503 32
-------- -------- -------- --------
Adjusted EBITDA $ 13,891 $ 11,948 $ 39,044 $ 33,266
======== ======== ======== ========
(a) Other (income) loss for the three and nine months ended
September 30, 2006 includes $0.5 million and $1.6 million,
respectively, in pre-tax income related to certain termination
payments received from two of the Company's merchant customers.
These amounts are excluded from the calculation of Adjusted
EBITDA, as shown above.
CONTACT: Cardtronics, Inc.
Investor Contact:
J. Chris Brewster, CFO
(281) 892-0128
cbrewster@cardtronics.com
Media Contact:
Dawn Thompson, VP of Marketing
(281) 596-9988 x1359
dthompson@cardtronics.com