Payment Data Systems, Inc. (OTCBB: PYDS) an integrated electronic payments solutions provider, today announced financial results for the quarter ended September 30, 2011.

Revenues increased to $1,437,592 for the third quarter of 2011 up from $648,927 for the third quarter of 2010 due to higher transaction growth. The operating income for the quarter ended September 30, 2011 was $208,996 compared to operating loss of $134,626 for the third quarter of 2010. Net income for the quarter ended September 30, 2011 was $262,541 up from a net loss of $142,116 for the third quarter of 2010.

Highlights for the third quarter of 2011 include:
  • Revenue grew 87% over the second quarter of 2011.
  • Gross profit grew 208% to $523,262 as compared to $169,817 in the second quarter of 2011.
  • Cash and cash equivalents grew to $1,943,418 at September 30, 2011 from $318,471 at June 30, 2011.
  • Total current assets grew to $2,404,768 at September 30, 2011 from $516,422 at June 30, 2011.
  • Total transaction dollar volume increased to over $60,000,000.
  • Over 1,200,000 transactions were processed in the third quarter, representing 336% gain over the second quarter of 2011.

Commenting on the results for the quarter, Michael R. Long, Chairman and Chief Executive Officer of Payment Data Systems, said, “The tremendous growth we experienced this quarter has caused us to be very enthusiastic about our future. Our sales team did an outstanding job securing new clients and our operations team was able to implement the new customers with nominal capital expenditures. All this was accomplished while holding our selling and general administrative expenses constant.”

Mr. Long continued, “All financial metrics and operational metrics hit positive record levels this quarter. Achieving profitability is a major milestone and we believe we are now in a high growth phase. I am pleased to report that as of the date of this press release, we have already processed more transactions in the first 45 days of the current quarter than we accomplished in the record-setting third quarter. I am pleased to be able to project that the fourth quarter will exceed the tremendous growth that we experienced in the third quarter. Equally exciting, we expect to close out the year with record growth in revenues, income from operations, and we expect to be profitable for the complete year’s results.”
PAYMENT DATA SYSTEMS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
       
 
Three Months Ended September 30, Nine Months Ended September 30,
 

2011
 

2010
   

2011
   

2010
 
 
Revenues $ 1,437,592 $ 648,927 $ 2,991,213 $ 1,855,599
 
Operating expenses:

Cost of services
914,330 496,249 2,124,577 1,442,038
Selling, general and
administrative:
Stock-based compensation 135,418 133,650 404,048 400,950
Other expenses 178,020 148,969 563,522 475,604
Depreciation   828   4,685     3,172     18,316  
Total operating expenses   1,228,596   783,553     3,095,319     2,336,908  
 
Operating income (loss) 208,996 (134,626 ) (104,106 ) (481,309 )
 
Other income (expense):
Unrealized gain (loss) on
marketable securities 66,809 - (24,929 ) -
Other income (expense)   105   (4,990 )   22,446     155,010  
Total other income (expense),
net   66,914   (4,990 )   (2,483 )   155,010  
 
Income (loss) before income
taxes 275,910 (139,616 ) (106,589 ) (326,299 )
Income taxes   13,369   2,500     13,369     11,045  
 
Net income (loss) $ 262,541 $ (142,116 ) $ (119,958 ) $ (337,344 )
 
 
Basic and diluted net loss per
common share: $ 0.00 $ 0.00 $ 0.00 $ 0.00
Weighted average common shares
outstanding 137,709,143 125,308,808 136,953,688 119,803,030
 

For further information regarding our financial results for the quarter ended September 30, 2011, please read our 10-Q that will be filed on end of the day on November 14, 2011.

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