Quarterly Revenue increased 16% Second Quarter Net Income $0.3 million and Adjusted EBITDA $1.3 million LONG BEACH, N.Y., Aug. 13, 2013 (GLOBE NEWSWIRE) -- Planet Payment, Inc. (Nasdaq:PLPM) (LSE:PPT), a leading provider of international payment and transaction processing and multi-currency processing services, announced today its results for the second quarter ended June 30, 2013. Financial Highlights for the Quarter Ended June 30, 2013
- Net revenue for the period increased approximately 16% to $11.8 million compared to $10.1 million in the second quarter of 2012.
- Consolidated gross billings increased 11% to $30.4 million compared to $27.4 million in the second quarter of 2012. (See Table 3 for explanation of this metric).
- Gross foreign currency mark-up increased 8% to $26.1 million compared to $24.1 million in the second quarter of 2012. (See Table 3 for explanation of this metric).
- Processing services revenue increased 32% to $4.3 million compared to $3.3 million in the second quarter of 2012.
- Net income for the period was $0.3 million compared to a net loss of $1.2 million in the second quarter of 2012.
- Adjusted EBITDA for the period was $1.3 million compared to $0.1 million in the second quarter of 2012. (See Table 1 for reconciliation of net income to Adjusted EBITDA).
- Total active merchant locations increased by 30% to approximately 44,000 (See Table 3 for explanation of this metric).
- Total settled dollar volume processed increased 20% to $1.7 billion and total settled transactions processed increased 34% to 14.9 million. (See Table 3 for explanation of these metrics).
- Total acquirer and processor customers increased to 60 based on roll outs in U.S.A., Myanmar and Greater China.
- Launched Pay in Your Currency® at Billabong locations and additional ATMs with Vantiv and Payment Alliance International across the United States, as well as additional hospitality solutions for customers in Canada and Mexico.
Outlook for Fiscal Year 2013We have seen weakness in our multi-currency revenues, particularly in the APAC region. This resulted from continued change in international travel trends and softness in some of our customers' portfolios in the APAC region in particular. If these trends persist for the rest of the year, this may impact the growth in our multi-currency revenues during 2013. Some of our customers, particularly in the Americas, have been slower than anticipated in completing technical implementations or roll-outs to their customer portfolios, which may also impact 2013 results. Accordingly we are adjusting our guidance for 2013 to reflect these uncertainties, as follows:
- Net revenue estimated to be in the range of $48.0 million to $50.0 million.
- Net income estimated to be in the range of $1.0 million to $2.9 million.
- Adjusted EBITDA estimated to be in the range of $5.4 million to $7.4 million. (See Table 2 for reconciliation of prospective net income to Adjusted EBITDA).
- Fully diluted earnings per share estimated to be in the range of $0.02 to $0.05 based upon 56.0 million fully diluted common shares outstanding.
Planet Payment is headquartered in New York and has offices in Atlanta, Beijing, Bermuda, Delaware, Dubai, Dublin, London, Hong Kong, Mexico City, Shanghai and Singapore. Visit www.planetpayment.com for more information about the Company and its services. For up-to-date information follow Planet Payment on Twitter at @PlanetPayment or join Planet Payment's Facebook page.Non-GAAP Financial Information The Company provides certain non-GAAP financial measures in this announcement. Management believes that Adjusted EBITDA, when viewed with our results under GAAP and the accompanying reconciliations, provides useful information about our period-over-period results. Adjusted EBITDA is presented because management believes it provides additional information with respect to the performance of our fundamental business activities and is also frequently used by securities analysts, investors and other interested parties in the evaluation of comparable companies. We also rely on Adjusted EBITDA as a primary measure to review and assess the operating performance of our company and our management team in connection with our executive compensation. These non-GAAP key business indicators, which include Adjusted EBITDA, should not be considered replacements for and should be read in conjunction with the GAAP financial measures. We define Adjusted EBITDA as GAAP net income (loss) adjusted to exclude: (1) interest expense, (2) interest income, (3) provision (benefit) for income taxes, (4) depreciation and amortization, (5) stock‑based expense from options and warrants and (6) certain other items management believes affect the comparability of operating results. Please see "Adjusted EBITDA" below for more information and for a reconciliation of Adjusted EBITDA to net income, the most directly comparable financial measure calculated and presented in accordance with GAAP. Table 1. Reconciliation of Net Income to Adjusted EBITDA For the three and six months ended June 30, 2013 and 2012
|Three months ended June 30,||Six months ended June 30,|
|Net income (loss)||$304,691||$(1,158,622)||$676,607||$(371,475)|
|Provision for income taxes||67,974||135,426||68,567||230,698|
|Depreciation and amortization||669,430||686,841||1,405,036||1,307,461|
|Acquisition deal costs||—||121,755||—||121,755|
|Adjusted EBITDA (non-GAAP)||$1,347,575||$115,518||$2,727,553||$1,856,998|
|Provision for income taxes||0.1||0.2|
|Depreciation and amortization||3.0||3.0|
|Adjusted EBITDA (non-GAAP)||$5.4||$7.4|
|Three months ended June 30,||Six months ended June 30,|
|Consolidated gross billings(1)||$30,406,907||$27,418,225||$62,908,833||$57,655,465|
|Total settled dollar volume processed (2)||$1,731,199,719||$1,439,048,428||$3,431,303,136||$2,870,031,526|
|Total active merchant locations (at period end) (3)||44,467||34,172||44,467||34,172|
|Total settled transactions processed (4)||14,882,349||11,097,084||28,061,154||21,432,710|
|Multi-currency processing services key metrics:|
|Active merchant locations (at period end)(3)||23,509||18,076||23,509||18,076|
|Settled transactions processed(5)||3,015,374||2,843,781||6,059,344||5,820,697|
|Gross foreign currency mark-up(6)||$26,089,431||$24,141,247||$54,336,023||$50,220,176|
|Settled dollar volume processed(7)||$637,806,403||$625,873,503||$1,335,672,927||$1,309,308,011|
|Average net mark-up percentage on settled dollar volume processed(8)||1.17%||1.09%||1.14%||1.10%|
|Payment processing services key metrics:|
|Active merchant locations (at period end)(3)||20,979||16,109||20,979||16,109|
|Payment processing services revenue(9)||$4,317,476||$3,276,978||$8,572,810||$7,435,289|
|Settled transactions processed(10)||11,866,975||8,253,303||22,001,810||15,612,013|
|Settled dollar volume processed(11)||$1,093,393,316||$813,174,925||$2,095,630,209||$1,560,723,515|
(2) Represents total settled dollar volume processed through both our multi-currency and payment processing services.(3) We consider a merchant location to be active as of a date if the merchant completed at least one revenue-generating transaction at the location during the 90-day period ending on such date. The total number of active merchant locations exceeds the total number of merchants, as merchants may have multiple locations. As of June 30, 2013 and 2012, there were 21 and 13 active merchant locations, respectively, included in both multi-currency and payment processing active merchant locations but are not included in total active merchant locations, in order to eliminate double counting. (4) Represents total settled transactions (excluding other transaction types such as authorizations, rate look-ups and non-financial transactions). (5) Represents settled transactions processed using our multi-currency processing services (excluding other transaction types such as authorizations, rate look-ups and non-financial transactions). (6) Represents the gross foreign currency mark-up amount on settled dollar volume processed using our multi-currency processing services. Gross foreign currency mark-up represents multi-currency processing services net revenue plus amounts paid to acquiring banks and their merchants associated with such multi-currency processing transactions. Management believes this metric is relevant because it provides the reader an indication of the gross mark-up derived from multi-currency transactions processed through our platform during a given period. (7) Represents the total settled dollar volume processed using our multi-currency processing services. (8) Represents the average net foreign currency mark-up percentage earned on settled dollar volume processed using our multi-currency processing services. The average net mark-up percentage on settled dollar volume processed is calculated by taking the reported total multi-currency processing services net revenue ($7.4 million and $6.8 million for the three months ended June 30, 2013 and 2012, respectively, and $15.3 million and $14.4 million for the six months ended June 30, 2013 and 2012, respectively) and dividing by settled dollar volume processed.
(9) Represents revenue earned and reported on payment processing services.(10) Represents settled transactions processed using our payment processing services (excluding other transaction types such as authorizations, rate look-ups and non-financial transactions). (11) Represents the total settled dollar volume processed using our payment processing services. Planet Payment, Inc. Condensed Consolidated Balance Sheets
|As of June 30,||As of December 31,|
|Cash and cash equivalents||$5,313,971||$6,002,457|
|Accounts receivable, net of allowances of $0.2 million as of June 30, 2013 and $1.5 million December 31, 2012||5,589,554||5,585,815|
|Prepaid expenses and other assets||1,896,573||2,395,137|
|Total current assets||14,852,643||16,501,025|
|Property and equipment, net||2,186,276||1,396,154|
|Software development costs, net||5,013,802||4,776,320|
|Intangible assets, net||2,925,065||3,289,590|
|Security deposits and other assets||945,792||338,408|
|Total other assets||12,082,549||10,817,477|
|Liabilities and stockholders' equity|
|Due to merchants||1,934,710||2,546,140|
|Current portion of capital leases liability||450,644||337,588|
|Total current liabilities||6,524,558||9,071,635|
|Long-term portion of capital leases liability and other long-term liabilities||1,060,681||364,010|
|Total long-term liabilities||1,060,681||364,010|
|Commitments and contingencies|
|Convertible preferred stock— 10,000,000 shares authorized as of June 30, 2013 and December 31, 2012, $0.01 par value: Series A— 2,243,750 issued and outstanding as of June 30, 2013 and December 31, 2012; $8,975,000 aggregate liquidation preference||22,438||22,438|
|Common stock—250,000,000 shares authorized as of June 30, 2013 and December 31, 2012, $0.01 par value, and 54,483,340 and 53,658,857 issued and outstanding as of June 30, 2013 and December 31, 2012, respectively||544,833||536,589|
|Additional paid-in capital||100,059,732||99,199,149|
|Accumulated other comprehensive (loss) gain||(40,413)||37,925|
|Total stockholders' equity||19,349,953||17,882,857|
|Total liabilities and stockholders' equity||$26,935,192||$27,318,502|
Planet Payment, Inc. Condensed Consolidated Statements of Operations (unaudited)
|Three months ended June 30,||Six months ended June 30,|
|Cost of revenue:|
|Payment processing services fees||2,748,935||2,434,248||5,551,224||5,217,839|
|Processing and service costs||3,178,655||2,642,590||6,354,302||5,373,419|
|Total cost of revenue||5,927,590||5,076,838||11,905,526||10,591,258|
|Selling, general and administrative expenses||5,448,955||6,049,283||11,171,639||11,319,331|
|Total operating expenses||11,376,545||11,126,121||23,077,165||21,910,589|
|Income (loss) from operations||388,118||(1,009,083)||773,561||(112,615)|
|Other income (expense):|
|Total other expense, net||(15,453)||(14,113)||(28,387)||(28,162)|
|Income (loss) before provision for income taxes||372,665||(1,023,196)||745,174||(140,777)|
|Provision for income taxes||(67,974)||(135,426)||(68,567)||(230,698)|
|Net income (loss)||$304,691||$(1,158,622)||$676,607||$(371,475)|
|Basic net income (loss) per share applicable to common stockholders||$0.01||$(0.02)||$0.01||$(0.01)|
|Diluted net income (loss) per share applicable to common stockholders||$0.00||$(0.02)||$0.01||$(0.01)|
|Weighted average common stock outstanding (basic)||52,832,451||52,035,014||52,805,938||51,906,425|
|Weighted average common stock outstanding (diluted)||54,570,476||52,035,014||54,672,972||51,906,425|
Planet Payment, Inc. Condensed Consolidated Statements of Cash Flows (unaudited)
|Six months ended|
|Cash flows from operating activities:|
|Net income (loss)||$ 676,607||$ (371,475)|
|Adjustments to reconcile net income (loss) to net cash provided by operating activities:|
|Stock option expense||548,956||540,397|
|Depreciation and amortization expense||1,405,036||1,307,461|
|Provision for doubtful accounts||230,644||78,988|
|Loss on disposal of equipment||4,979||—|
|Gain on insurance settlement||(301,281)|
|Changes in operating assets and liabilities, net of effects of acquisition|
|Decrease (increase) in settlement assets||465,071||(518,202)|
|(Increase) decrease in accounts receivables, prepaid expenses and other current assets||(97,700)||443,426|
|Increase in security deposits and other assets||(345,503)||(6,901)|
|Decrease in accounts payable, accrued expenses and other long-term liabilities||(1,563,329)||(63,572)|
|(Decrease) increase in due to merchants||(611,430)||455,132|
|Net cash provided by operating activities||372,886||1,849,247|
|Cash flows from investing activities:|
|Decrease in restricted cash||—||59,984|
|Purchase of property and equipment||(684,667)||(95,782)|
|Capitalized software development||(807,027)||(744,902)|
|Purchase of intangible assets||(59,287)||(38,318)|
|Cash paid for business combination, net of cash acquired||—||(1,577,829)|
|Net cash used in investing activities||(1,149,700)||(2,396,847)|
|Cash flows from financing activities:|
|Proceeds from issuance of common stock||292,202||61,680|
|Principal payments on capital lease obligations||(203,874)||(184,757)|
|Payment of IPO costs||—||(354,531|
|Net cash provided by (used in) financing activities||88,328||(477,608)|
|Effect of exchange rate changes on cash and cash equivalents(*)||—||—|
|Net decrease in cash and cash equivalents||(688,486)||(1,025,208|
|Beginning of period||6,002,457||7,671,963|
|End of period||5,313,971||6,646,755|
|Cash paid for:|
|Interest||$ 31,146||$ 27,872|
|Non cash investing and financing activities:|
|Assets acquired under capital leases||$ 464,729||$ 180,805|
|Common stock issued for BPS acquisition||—||1,596,862|
|Accrued capitalized hardware, software and fixed assets||63,507||55,643|
|Capitalized stock-based compensation||27,669||—|
|Accrued IPO Costs||—||340,890|
|(*) For the six months ended June 30, 2013 and 2012, the effect of exchange rate changes on cash and cash equivalents was inconsequential.|
Notes to Condensed Consolidated Financial Statements (unaudited)1. Business description and basis of presentation Business description Planet Payment, Inc. together with its wholly owned subsidiaries ("Planet Payment," the "Company," "we," or "our") is a provider of international payment and transaction processing and multi-currency processing services. The Company provides its services to approximately 44,000 active merchant locations in more than 20 countries and territories across the Asia Pacific region, North America, the Middle East, Africa and Europe, primarily through its acquiring bank and processor customers, as well as through its own direct sales force. The Company's point-of-sale, e-commerce and ATM services are integrated within the payment card transaction flow and enable its acquiring customers to process and reconcile payment transactions in multiple currencies, geographies and channels. The Company is a registered third party processor with the major card associations and operates in accordance with industry standards, including the Payment Card Industry, or PCI, Security Council's Data Security Standards. Company structure Planet Payment was incorporated in the State of Delaware on October 12, 1999 as Planet Group Inc. and changed its name to Planet Payment, Inc. on June 18, 2007. Since March 20, 2006, shares of the Company's common stock have traded on the Alternative Investment Market of the London Stock Exchange, or AIM, under the symbols "PPT". From March 2006 until June 2013 shares of our common stock were also traded on AIM under the symbol "PPTR." From November 19, 2008 until December 14, 2012, shares of our common stock were traded on the OTCQX under the symbol "PLPM." On December 17, 2012 shares of our common stock began trading on NASDAQ under the symbol "PLPM." Basis of presentation The condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"). The accompanying condensed consolidated financial statements include the accounts of Planet Payment, Inc. and its wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated.
As of March 31, 2013 the Company wrote-off a previously fully reserved trade receivable in the amount of $1.4 million.Unaudited consolidated interim financial information The accompanying unaudited condensed consolidated interim financial statements as of June 30, 2013 and for the periods ended June 30, 2013 and 2012 have been prepared on the same basis as the annual consolidated financial statements. In the opinion of management, the unaudited financial information for the interim periods presented reflects all adjustments, which are normal and recurring, necessary for a fair presentation of the statement of operations, financial position and cash flows. The accompanying unaudited condensed consolidated interim financial statements should be read in conjunction with the audited consolidated financial statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2012. Operating results for the interim periods ended June 30, 2013 are not necessarily indicative of the results that may be expected for the year ending December 31, 2013. The December 31, 2012 balance sheet information has been derived from the audited financial statements at that date. Certain information and disclosures normally included in annual consolidated financial statements have been omitted pursuant to the rules and regulation of the Securities and Exchange Commission, or SEC.
CONTACT: Planet Payment, Inc. Robert Cox (CFO) Tel: + 1 516 670 3200 www.planetpayment.com Redleaf Polhill (UK PR for Planet Payment) Emma Kane / Rebecca Sanders-Hewett / David Ison Tel: +44 207 382 4730 firstname.lastname@example.org ICR (USA IR for Planet Payment) Don Duffy / Dara Dierks Tel: +1 646-277-1212 Canaccord Genuity Ltd (Nomad for Planet Payment) Simon Bridges / Andrew Chubb Tel: +44 20 7523 8000