Payment Data Systems Announces Third Quarter 2016 Results

SAN ANTONIO, Nov. 14, 2016 (GLOBE NEWSWIRE) -- Payment Data Systems, Inc. (NASDAQ:PYDS), an integrated payment solutions provider, today announced financial results for the third quarter ended September 30, 2016.

Third Quarter 2016 Financial and Operating Summary
  • Revenues were $3.1 million
  • Gross margin was $965,485, or 31% of revenues
  • Operating loss was $574,897
  • Adjusted EBITDA loss 1 was $129,859
  • Net loss was $565,957, or $0.07 per share
  • Total dollars processed for the third quarter of 2016 exceeded $759 million, compared to $865 million in the third quarter of 2015 
  • Third quarter credit card transaction processing volume decreased 2% and credit card dollars processed decreased 9% compared with the same period in 2015
  • ACH (Electronic check) transaction volumes decreased 15%; returned check transactions processed decreased 24% compared to the third quarter of 2015

1See Reconciliation of GAAP Operating Income to Adjusted EBITDA in the accompanying financial tables

Management Commentary

"Overall transaction volumes and dollars processes increased in the third quarter compared to the previous quarter, driving sequential growth in revenues and gross margin," said Louis Hoch, President and CEO, Payment Data Systems, Inc.  "Given the year-over-year decline in ACH transaction volumes that we have experienced this year, we accelerated our marketing and promotional strategies during the third quarter and are pleased to see these efforts paying off.  We are continuing to build solid traction through product innovations that support and enhance customer operations, such as the use of our prepaid card technology to support real-time provisioning to mobile wallets like Apple Pay ┬« and instantaneous issuance and delivery of gift and incentive cards.  Our new PIN-less debit product, that allows merchants to debit and credit accounts in real-time, was rolled out in October and we are very pleased with the traction we are receiving.  We expect it to become a significant offering for our Company."

Financial Results

Three Months Ended September 30, 2016

Revenues of $3.1 million decreased 14% compared to $3.6 million for the third quarter of 2015, due to a decrease in the volume of ACH transactions and returned checks processed.

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