Outerwall 8-K Coinstar Announces Second Quarter 2009 Results

Exhibit 99.1

Investor Contact:

Rosemary Moothart

Director of Investor Relations

425-943-8140

rosemary.moothart@coinstar.com

Media Contact:

Marci Maule

Director of Public Relations

425-943-8277

marci.maule@coinstar.com

COINSTAR ANNOUNCES SECOND QUARTER 2009 RESULTS

Company Delivers Strong Revenue and EPS Performance

BELLEVUE, Wash.—August 4, 2009—Coinstar, Inc. (NASDAQ: CSTR) today announced financial results for the quarter and six-month period ended June 30, 2009.

Highlights for the quarter ended June 30, 2009, were as follows:

Revenue	$314.0 million
EBITDA (see Appendix A)	$50.8 million
Net Income attributable to Coinstar, Inc.	$7.0 million
Earnings per Share		$0.23

Highlights for the six months ended June 30, 2009, were as follows:

Revenue	$585.1 million
EBITDA (see Appendix A)	$92.8 million
Net Income attributable to Coinstar, Inc.	$8.9 million
Earnings per Share		$0.30

Revenuefor the second quarter of 2009 totaled $314.0 million, representing an increase of 42.8 percent over revenue of $219.9 million in the second quarter of 2008.

Operating incomefor the quarter was $20.8 million, resulting in a 6.6 percent operating margin, compared with operating income of $15.5 million and a 7.0 percent operating margin in the second quarter of 2008.

Pre-tax incomefor the quarter was $12.3 million, resulting in a 3.9 percent pre-tax margin, compared with pre-tax income of $9.5 million and a 4.3 percent pre-tax margin in the second quarter of 2008.

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Net incomeattributable to Coinstar for the quarter was $7.0 million, representing earnings per share of $0.23 per diluted share, compared with net income attributable to Coinstar of $2.7 million, or $0.09 per diluted share in the second quarter of 2008.

“We are very pleased with our strong revenue and EPS performance in the second quarter driven by our core businesses, DVD and Coin,” said Paul Davis, chief executive officer of Coinstar, Inc. “We believe that our DVD and Coin businesses form a solid platform for growth in the attractive and growing category of Automated Retail and we are positioning our company to leverage this opportunity. As a result, we will explore strategic alternatives for our E-Payment and Money Transfer businesses, in addition to Entertainment, which we previously announced.”

Other Information

Cash paid for capital expenditures for the quarter ended June 30, 2009 was $40.8 million.

At June 30, 2009, Coinstar had federal and state cumulative net operating loss carryforwards of approximately $68.7 million and $39.3 million, respectively. In addition, Coinstar had foreign net operating loss carryforwards of approximately $30.9 million. The state and foreign loss carryforwards are subject to certain limitations that may prevent or delay utilization of the losses against future income. Although Coinstar recorded $5.3 million in tax expense for the quarter, cash paid for taxes during the quarter totaled $0.5 million.

Full Year 2009 Guidance

For 2009, management narrowed previous guidance for revenue, and now expects revenue in the range of $1.225 billion to $1.300 billion. Management increased guidance for EBITDA to a range of $200 million to $210 million. In addition, management announced that it expects GAAP EPS in the range of $0.80 to $0.86.

Conference Call

A conference call to discuss the Company’s second quarter 2009 results will be broadcast live via the Internet today, August 4, 2009, at 5:00 p.m. ET. The webcast will be hosted on the “About Us — Investor Relations” section of Coinstar’s Web site atwww.coinstar.com, where certain accompanying information relating to the conference call will be accessible.

About Coinstar, Inc.

Coinstar, Inc. (NASDAQ: CSTR) is a leading provider of automated retail solutions offering convenient products and services that make life easier for consumers and drive incremental traffic and revenue for its retailers. The company’s core automated retail businesses are self-service coin counting and self-service DVD rental. Other Coinstar products and services found at the retail front-end include e-payment products such as gift cards, prepaid debit cards and other prepaid products; money transfer services; and entertainment products and services,

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including skill crane machines and bulk vending. The Company’s products and services can be found at more than 95,000 points of presence including supermarkets, drug stores, mass merchants, financial institutions, convenience stores, restaurants and money transfer agents. For more information, visitwww.coinstar.com.

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Certain statements in this press release are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. The words “believe,” “estimate,” “expect,” “intend,” “anticipate,” “goals,” variations of such words, and similar expressions identify forward-looking statements, but their absence does not mean that the statement is not forward-looking. The forward-looking statements in this release include statements regarding Coinstar, Inc.’s anticipated growth and future operating results. Forward-looking statements are not guarantees of future performance and actual results may vary materially from the results expressed or implied in such statements. Differences may result from actions taken by Coinstar, Inc., as well as from risks and uncertainties beyond Coinstar, Inc.’s control. Such risks and uncertainties include, but are not limited to, the termination, non-renewal or renegotiation on materially adverse terms of our contracts with our significant retailers, payment of increased service fees to retailers, the ability to attract new retailers, penetrate new markets and distribution channels, cross-sell our products and services and react to changing consumer demands, the ability to achieve the strategic and financial objectives for our entry into or expansion of new businesses, the ability to adequately protect our intellectual property, and the application of substantial federal, state, local and foreign laws and regulations specific to our business. The foregoing list of risks and uncertainties is illustrative, but by no means exhaustive. For more information on factors that may affect future performance, please review “Risk Factors” described in our most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission. These forward-looking statements reflect Coinstar, Inc.’s expectations as of the date of this release. Coinstar, Inc. undertakes no obligation to update the information provided herein.

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Appendix A
(in thousands unless otherwise noted)

Non-GAAP measures

Non-GAAP measures may be provided as a complement to results provided in accordance with United States generally accepted accounting principles (“GAAP”). Non-GAAP measures are not a substitute for measures computed in accordance with GAAP. The definition of EBITDA, a non-GAAP measure, is provided below. This definition is provided to allow the reader to reconcile non-GAAP data to that presented in accordance with GAAP. Our non-GAAP measure may be different from the presentation of financial information by other companies.

EBITDA, as defined,represents earnings before net interest expense, income taxes, depreciation, amortization and certain other non-cash charges including stock based compensation expense and non-controlling interests. We believe EBITDA is an important non-GAAP measure as it provides useful information to investors regarding our ability to service, incur or pay down indebtedness. In addition, management uses such non-GAAP measure internally to evaluate performance and manage operations. See below for reconciliation of most comparable GAAP measure, net income attributable to Coinstar, Inc., to EBITDA.

	Three Month Periods		Three Month Periods
(in thousands)	Ended June 30, 2009		Ended June 30, 2008
Net income attributable to Coinstar, Inc.	$	6,958	$	2,680
Depreciation, amortization and other		27,904		21,232
Interest expense, net		8,600		5,280
Income taxes		5,349		2,585
Stock based compensation		1,943		1,870
Non-controlling interests		0		4,269
EBITDA	$	50,754	$	37,916

	Six Month Periods		Six Month Periods
(in thousands)	Ended June 30, 2009		Ended June 30, 2008
Net income attributable to Coinstar, Inc.	$	8,921	$	5,381
Depreciation, amortization and other		53,230		40,545
Interest expense, net		15,025		9,936
Income taxes		7,288		5,097
Stock based compensation		4,737		3,984
Non-controlling interests		3,627		7,442
EBITDA	$	92,828	$	72,385

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Coinstar, Inc.
Consolidated Statements of Operations
(in thousands, except per share data)
(unaudited)

	Three Month Periods						Six Month Periods
	Ended June 30						Ended June 30
	2009			2008			2009			2008
REVENUE	$	313,968		$	219,903		$	585,123		$	410,422
EXPENSES
Direct operating		224,153			150,509			416,179			281,819
Marketing		5,714			3,815			10,849			6,618
Research and development		1,299			1,175			2,556			2,421
General and administrative		34,087			24,706			67,385			45,802
Depreciation and other		25,713			18,855			48,858			35,826
Amortization of intangible assets		2,191			2,298			4,372			4,640
Proxy, write-off of acquisition costs and litigation settlement		—			3,084			—			3,084
Income from operations		20,811			15,461			34,924			30,212
OTHER INCOME (EXPENSE):
Foreign currency loss and other, net		96			(890	)		(63	)		(2,018	)
Interest income		47			626			161			885
Interest expense		(8,647	)		(5,906	)		(15,186	)		(10,822	)
Income (loss) from equity investments		—			243			—			(337	)
Income before income taxes		12,307			9,534			19,836			17,920
Income tax expense		(5,349	)		(2,585	)		(7,288	)		(5,097	)
NET INCOME before non-controlling interests		6,958			6,949			12,548			12,823
Less: Net income attributable to non-controlling interests		—			(4,269	)		(3,627	)		(7,442	)
NET INCOME attributable to Coinstar, Inc.	$	6,958		$	2,680		$	8,921		$	5,381
EARNINGS PER SHARE:
Basic	$	0.23		$	0.10		$	0.30		$	0.19
Diluted	$	0.23		$	0.09		$	0.30		$	0.19
WEIGHTED SHARES OUTSTANDING:
Basic		30,117			28,022			29,525			27,903
Diluted		30,575			28,600			29,893			28,418

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Coinstar, Inc.
Consolidated Balance Sheets
(in thousands)
(unaudited)

	June 30,			December 31,
	2009			2008
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	58,407		$	66,408
Cash in machine or in transit		48,712			34,583
Cash being processed		81,133			91,044
Trade accounts receivable, net of allowance for doubtful accounts of $4,029 and $2,702 at June 30, 2009 and December 31, 2008, respectively		60,468			51,908
Inventory		97,438			92,247
Deferred income taxes		7,191			6,881
Prepaid expenses and other current assets		27,407			24,715
Total current assets		380,756			367,786
PROPERTY AND EQUIPMENT, NET		384,912			348,949
DEFERRED INCOME TAXES		41,713			4,338
OTHER ASSETS		12,494			11,865
INTANGIBLE ASSETS, NET		39,038			43,385
GOODWILL		290,300			290,391
TOTAL ASSETS	$	1,149,213		$	1,066,714
LIABILITIES AND EQUITY
CURRENT LIABILITIES:
Accounts payable	$	109,697		$	132,194
Accrued payable to retailers and agents		129,687			132,490
Other accrued liabilities		78,186			87,500
Current portion of long-term debt		6,545			11,655
Current portion of capital lease obligations		19,374			20,264
Total current liabilities		343,489			384,103
LONG-TERM DEBT AND OTHER		459,144			295,942
CAPITAL LEASE OBLIGATIONS		15,641			23,509
DEFERRED TAX LIABILITY		1,750			12,072
TOTAL LIABILITIES		820,024			715,626
EQUITY:
Preferred stock, $0.001 par value—Authorized, 5,000,000 shares; no shares issued and outstanding at June 30, 2009 and December 31, 2008		—			—
Common stock, $0.001 par value—Authorized, 45,000,000 shares; 32,184,942 and 30,181,151 issued and 30,258,861 and 28,255,070 shares outstanding at June 30, 2009 and December 31, 2008, respectively		367,653			369,735
Retained earnings (Accumulated deficit)		6,249			(2,672	)
Treasury stock		(40,831	)		(40,831	)
Accumulated other comprehensive loss		(3,882	)		(6,204	)
Total stockholders’ equity		329,189			320,028
Non-controlling interests		—			31,060
Total EQUITY		329,189			351,088
TOTAL LIABILITIES AND EQUITY	$	1,149,213		$	1,066,714

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Coinstar, Inc.
Consolidated Statements of Cash Flows
(in thousands)
(unaudited)

	Six Month Periods
	Ended June 30
	2009			2008
OPERATING ACTIVITIES:
Net income	$	12,548		$	12,823
Adjustments to reconcile income from operations to net cash provided by operating activities:
Depreciation and other		48,858			35,826
Amortization of intangible assets and deferred financing fees		4,878			4,923
Write-off of acquisition costs		1,262			1,004
Non-cash stock-based compensation		4,737			3,984
Excess tax benefit on share-based awards		(125	)		(531	)
Deferred income taxes		7,871			5,276
Income from equity investments		—			3,449
Other		126			575
Cash used by changes in operating assets and liabilities, net of effects of business acquisitions:		(51,755	)		(5,567	)
Net cash provided by operating activities		28,400			61,762
INVESTING ACTIVITIES:
Purchase of property and equipment		(78,044	)		(72,793	)
Acquisitions, net of cash acquired		—			(24,834	)
Proceeds from sale of fixed assets		435			1,898
Net cash used by investing activities		(77,609	)		(95,729	)
FINANCING ACTIVITIES:
Principal payments on capital lease obligations		(13,515	)		(7,948	)
Net borrowings on revolving credit facility		73,000			57,000
Borrowings on term loan		87,500			—
Financing costs associated with revolving line of credit		(3,234	)		—
Excess tax benefit on share-based awards		125			531
Cash used to purchase remaining non-controlling interest in Redbox		(102,353	)		—
Proceeds from exercise of stock options		2,260			8,149
Net cash provided by financing activities		43,783			57,732
Effect of exchange rate changes on cash		1,643			1,953
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS, CASH IN MACHINE OR IN TRANSIT, AND CASH BEING PROCESSED		(3,783	)		25,718
CASH AND CASH EQUIVALENTS, CASH IN MACHINE OR IN TRANSIT, AND CASH BEING PROCESSED:
Beginning of period		192,035			196,592
End of period	$	188,252		$	222,310

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