Attached files
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| 8-K - FORM 8K - LML PAYMENT SYSTEMS INC | form8k110810.htm |
Exhibit 99.1
LML REPORTS PROFITABLE RESULTS FOR FIRST QUARTER 2012
Overall Revenue Increases 16%
Profitability Achieved Across All Three Business Segments
VANCOUVER, BC, August 11, 2011 — LML PAYMENT SYSTEMS INC. (NASDAQ: LMLP), a leading payments technology provider of financial payment solutions for e-commerce and traditional businesses, reports results for its first quarter ended June 30, 2011.
Revenue for the three months ended June 30, 2011 was $5,976,000, an increase of 16% over the $5,131,000 in revenue for the three months ended June 30, 2010. Gross profit was $2.6 million or 44%. Net income for the quarter was $693,000, or $0.02 per share, compared to net income of $541,000, or $0.02 per share, for the first quarter ended June 30, 2010.
Q1 Highlights
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Overall revenue increased 16%
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·
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Net income improved 28% to $693,000
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Transaction Payment Processing Segment continued to grow in excess of 30%
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Launched multi-currency processing solution for over 150 currencies
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Activated 696 new merchants
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Check Processing Segment revenue increased 24.8%
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All three business segments achieved profitability
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“We are pleased with these profitable results. Once again, all three of our business units achieved profitability. Revenue from our TPP segment continued to grow at just over 30%. We added nearly 700 new active merchants and developed and launched two new payment products including a multi-currency solution and a customized payment and reward software solution for an existing client. We continued with the monetization of our intellectual property assets as we licensed one defendant involved in our patent litigation on a fully paid-up, non-recurring basis. We believe these efforts will be key in supporting our growth objectives both organically and inorganically as a payments processor, particularly during this very exciting time as commerce convergence opportunities continue to advance across many different models and industries,” said Patrick H. Gaines, Chief Executive Officer of LML.
Conference Call
Management will host a conference call on Friday, August 12 at 1:30pm Pacific Time (4:30pm Eastern Time) to discuss these results. To participate in the conference call, please dial in 5-10 minutes before the start of the call and follow the operator’s instruction. If you are calling from the United States or Canada, please dial 1-800-682-8537. International callers please dial 303-223-2687.
If you are unable to join the call, an audio recording of the call will be available on our website at www.lmlpayment.com.
About LML Payment Systems Inc. (www.lmlpayment.com)
LML Payment Systems Inc., through its Canadian subsidiary Beanstream Internet Commerce Inc., and US subsidiaries Beanstream Internet Commerce Corp (www.beanstream.com) and LML Payment Systems Corp., is a leading provider of financial payment processing solutions for e-commerce and traditional businesses. We provide credit card processing, online debit, electronic funds transfer, automated clearinghouse payment processing and authentication services, along with routing of selected transactions to third party processors and banks for authorization and settlement. Our intellectual property estate, owned by subsidiary LML Patent Corp., includes U.S. Patent No. RE40,220, No. 6,354,491, No. 6,283,366, No. 6,164,528, and No. 5,484,988 all of which relate to electronic check processing methods and systems.
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Cautionary Statement Regarding Forward-Looking Statements
Certain statements in this press release are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include all passages containing verbs such as "aims," "anticipates," "estimates," "expects," "intends," "plans," "predicts," "projects" or "targets" or nouns corresponding to such verbs. Forward-looking statements also include any other passages that are primarily relevant to expected future events or that can only be evaluated by events that will occur in the future. Forward-looking statements are based on the opinions and estimates of the management at the time the statements are made and are subject to certain risks and uncertainties that could cause actual results to differ materially from those anticipated in the forward-looking statements. Factors that could affect LML’s actual results include, among others, the impact, if any, of stock-based compensation charges, the potential failure to establish and maintain strategic relationships, inability to integrate recent and future acquisitions, inability to develop new products or product enhancements on a timely basis, inability to protect our proprietary rights or to operate without infringing the patents and proprietary rights of others, and quarterly and seasonal fluctuations in operating results. More information about factors that potentially could affect LML’s financial results is included in LML’s quarterly reports on Form 10-Q and our most recent annual report on Form 10-K filed with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance upon these forward-looking statements that speak only as to the date of this release. Except as required by law, LML undertakes no obligation to update any forward-looking or other statements in this press release, whether as a result of new information, future events or otherwise.
Cont’d…
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LML PAYMENT SYSTEMS INC.
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(In U.S. Dollars, except as noted below)
(Unaudited)
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As at June 30,
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As at March 31,
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As at April 1,
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2011
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2011
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2010
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ASSETS
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Current assets
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Cash and cash equivalents
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$ | 22,726,293 | $ | 26,917,491 | $ | 5,069,763 | ||||||
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Funds held for merchants
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8,357,070 | 7,164,420 | 5,804,752 | |||||||||
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Restricted cash
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175,000 | 175,000 | 175,000 | |||||||||
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Accounts receivable, less allowance of $28,295 ($28,152; $31,463)
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1,993,388 | 1,103,529 | 799,584 | |||||||||
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Corporate taxes receivable
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160,866 | 101,162 | 1,072,930 | |||||||||
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Prepaid expenses
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244,987 | 266,066 | 416,507 | |||||||||
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Total current assets
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33,657,604 | 35,727,668 | 13,338,536 | |||||||||
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Property and equipment, net
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151,304 | 163,222 | 219,580 | |||||||||
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Patents
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246,022 | 287,877 | 455,304 | |||||||||
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Restricted cash
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263,504 | 262,644 | 255,247 | |||||||||
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Deferred tax assets
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899,233 | 1,189,747 | 3,687,333 | |||||||||
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Goodwill
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17,874,202 | 17,874,202 | 17,874,202 | |||||||||
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Other intangible assets
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4,091,400 | 4,215,187 | 4,710,337 | |||||||||
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Other assets
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21,086 | 21,041 | 20,641 | |||||||||
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Total assets
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$ | 57,204,355 | $ | 59,741,588 | $ | 40,561,180 | ||||||
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LIABILITIES
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Current liabilities
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Accounts payable
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$ | 706,372 | $ | 702,820 | $ | 836,274 | ||||||
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Accrued liabilities
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1,250,509 | 1,390,847 | 1,040,443 | |||||||||
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Corporate taxes payable
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459,237 | 4,796,157 | - | |||||||||
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Funds due to merchants
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8,357,070 | 7,164,420 | 5,804,752 | |||||||||
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Current portion of obligations under finance lease
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2,460 | 2,460 | 11,195 | |||||||||
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Current portion of deferred revenue
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1,423,410 | 1,420,228 | 1,325,983 | |||||||||
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Total current liabilities
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12,199,058 | 15,476,932 | 9,018,647 | |||||||||
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Obligations under finance lease
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7,380 | 7,380 | 9,840 | |||||||||
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Deferred revenue
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627,875 | 935,979 | 2,155,162 | |||||||||
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Total liabilities
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12,834,313 | 16,420,291 | 11,183,649 | |||||||||
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COMMITMENTS AND CONTINGENCIES
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SHAREHOLDERS’ EQUITY
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Capital stock
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Class A, preferred stock, $1.00 CDN par value, 150,000,000 shares authorized, issuable in series, none issued or outstanding
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- | - | - | |||||||||
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Class B, preferred stock, $1.00 CDN par value, 150,000,000 shares authorized, issuable in series, none issued or outstanding
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- | - | - | |||||||||
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Common shares, no par value, 100,000,000 shares authorized, 28,233,434 issued and outstanding (28,127,184; 27,241,408)
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53,883,659 | 53,557,276 | 50,152,385 | |||||||||
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Contributed surplus
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8,834,435 | 8,819,006 | 7,987,727 | |||||||||
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Warrants
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113,662 | 113,662 | 649,500 | |||||||||
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Deficit
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(18,870,631 | ) | (19,563,201 | ) | (29,562,166 | ) | ||||||
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Accumulated other comprehensive income
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408,917 | 394,554 | 150,085 | |||||||||
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Total shareholders’ equity
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44,370,042 | 43,321,297 | 29,377,531 | |||||||||
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Total liabilities and shareholders’ equity
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$ | 57,204,355 | $ | 59,741,588 | $ | 40,561,180 | ||||||
Cont’d
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LML PAYMENT SYSTEMS INC.
CONSOLIDATED STATEMENTS OF EARNINGS AND COMPREHENSIVE INCOME
(In U.S. Dollars, except share data)
(Unaudited)
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Three Months Ended
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June 30
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2011
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2010
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REVENUE
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$ | 5,976,324 | $ | 5,130,919 | ||||
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COST OF REVENUE
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3,321,826 | 2,605,782 | ||||||
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GROSS PROFIT
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2,654,498 | 2,525,137 | ||||||
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OPERATING EXPENSES
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General and administrative
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889,146 | 1,057,917 | ||||||
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Sales and marketing
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210,223 | 108,336 | ||||||
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Product development and enhancement
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247,195 | 127,048 | ||||||
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Amortization of intangible assets
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165,645 | 165,645 | ||||||
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INCOME BEFORE OTHER INCOME AND INCOME TAXES
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1,142,289 | 1,066,191 | ||||||
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Foreign exchange gain
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31,650 | 67,902 | ||||||
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Interest income
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17,177 | 6,119 | ||||||
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INCOME BEFORE INCOME TAXES
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1,191,116 | 1,140,212 | ||||||
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Income tax expense (recovery)
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Current
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208,032 | (341,218 | ) | |||||
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Deferred
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290,514 | 940,325 | ||||||
| 498,546 | 599,107 | |||||||
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NET INCOME
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692,570 | 541,105 | ||||||
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OTHER COMPREHENSIVE INCOME
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Unrealized foreign exchange gain (loss) on translation of foreign operations
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14,363 | (91,936 | ) | |||||
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TOTAL COMPREHENSIVE INCOME
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$ | 706,933 | $ | 449,169 | ||||
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EARNINGS PER SHARE, basic and diluted
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$ | 0.02 | $ | 0.02 | ||||
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WEIGHTED AVERAGE SHARES OUTSTANDING
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Basic
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28,149,725 | 27,251,984 | ||||||
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Diluted
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28,987,253 | 27,496,401 | ||||||
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LML PAYMENT SYSTEMS INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In U.S. Dollars)
(Unaudited)
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Three Months Ended
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June 30
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2011
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2010
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Operating Activities:
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Net income
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$ | 692,570 | $ | 541,105 | ||||
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Adjustments to reconcile net income to net cash (used in) provided by operating activities
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Amortization of property and equipment
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34,240 | 37,529 | ||||||
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Amortization of intangible assets
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165,645 | 165,645 | ||||||
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Stock-based compensation
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136,437 | 130,514 | ||||||
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Deferred income taxes
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290,514 | 940,325 | ||||||
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Foreign exchange (gain)
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(3,703 | ) | - | |||||
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Changes in non-cash operating working capital
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Accounts receivable
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(884,868 | ) | (56,055 | ) | ||||
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Corporate taxes receivable
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(59,169 | ) | (344,293 | ) | ||||
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Prepaid expenses
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21,507 | 12,065 | ||||||
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Accounts payable and accrued liabilities
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(138,024 | ) | 232,863 | |||||
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Corporate taxes payable
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(4,336,920 | ) | - | |||||
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Deferred revenue
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(305,947 | ) | (266,943 | ) | ||||
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Net cash (used in) provided by operating activities
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(4,387,718 | ) | 1,392,755 | |||||
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Investing Activities:
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Acquisition of property and equipment
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(21,242 | ) | (3,420 | ) | ||||
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Proceeds from disposal of property and equipment
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- | |||||||
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Net cash used in investing activities
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(21,242 | ) | (3,420 | ) | ||||
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Financing Activities:
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Principal payments on finance leases
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- | (4,318 | ) | |||||
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Proceeds from exercise of stock options
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205,375 | - | ||||||
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Net cash provided by (used in) financing activities
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205,375 | (4,318 | ) | |||||
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Effects of foreign exchange rate changes on cash and cash equivalents
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12,387 | (64,386 | ) | |||||
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(DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS
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(4,191,198 | ) | 1,320,631 | |||||
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Cash and cash equivalents, beginning of period
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26,917,491 | 5,069,763 | ||||||
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Cash and cash equivalents, end of period
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$ | 22,726,293 | $ | 6,390,394 | ||||
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Supplemental disclosure of cash flow information
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Interest paid
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$ | - | $ | - | ||||
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Taxes paid
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$ | 4,599,921 | $ | - | ||||
CONTACTS:
Patrick H. Gaines Investor Relations
Chief Executive Officer (800) 888-2260
(604) 689-4440
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