Attached files
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| 8-K - FORM 8K 120618 - LML PAYMENT SYSTEMS INC | form8k120618.htm |
Exhibit 99.1
NEWS RELEASE
LML REPORTS PROFITABLE RESULTS FOR BOTH
FOURTH QUARTER AND FISCAL YEAR 2012
VANCOUVER, BC, June 18, 2012 — 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 fourth quarter and fiscal year ended March 31, 2012.
Q4
Revenue for the three months ended March 31, 2012 was $10.7 million. Gross profit was $5.4 million or 50%. Income before taxes was $3.5 million. Net income was $2.3 million or $0.09 per share, and net cash flow from operating activities for the three months was approximately $2.75 million.
Fiscal Year
Revenue for the year ended March 31, 2012 was $34.9 million. Gross profit was $17.6 million or 50%. Income before taxes was $11 million and net income was $6.7 million or $0.24 per share.
Fiscal Year Highlights
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·
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Transaction Payment Processing business segment revenue increases over 28%
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·
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Added 3,000 customers; Total customer base increases to over 13,000
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·
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New products developed for transaction security, multi-currency processing and mobile payment services initiatives
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·
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All three business segments (Transaction Payment Processing, Check Processing and Intellectual Property Licensing) made profitable contributions
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·
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Settled litigation with all remaining defendants in both Eastern District of Texas cases, generating non-recurring Intellectual Property Licensing revenue of $14.4 million
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“An ever expanding market opportunity and quickly developing technologies are allowing for, and in fact driving, unprecedented innovation and change in the payments industry. Our Transaction Payment Processing segment continued its impressive growth march, once again expanding revenue by close to 30%, while increasing our customer base by over 3,000 merchants. Innovation was no stranger to us – we developed new products in transaction security with our tokenization product and with multi-currency tools created our global transaction service and, finally, we developed what we believe is the most comprehensive mobile payment service in the country. Transaction volumes increased across the board as we processed over $8 billion in transaction volume. Our check operations carried out their own innovation and continued to make a profitable contribution and we completed the monetization of our intellectual property positioning ourselves to create and support even more innovation and growth in the future,” said Patrick H. Gaines, Chief Executive Officer of LML.
Conference Call
Management will host a conference call tomorrow 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 1-800-269-0310. International callers please dial 303-223-2680.
If you are unable to join the call, an audio recording of the call will be available on our website at www.lmlpayment.com.
Cont’d…
About LML Payment Systems Inc. (www.lmlpayment.com)
LML Payment Systems Inc., through its subsidiaries Beanstream Internet Commerce Inc. in Canada and LML Payment Systems Corp. in the U.S., 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. RE40220, 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.
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 share-based payment 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…
LML PAYMENT SYSTEMS INC.
CONSOLIDATED STATEMENTS OF EARNINGS AND COMPREHENSIVE INCOME
(In U.S. Dollars, except share data)
(Unaudited)
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Years ended March 31,
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2012
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2011
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|||||||
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REVENUE
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$ | 34,916,802 | $ | 47,160,490 | ||||
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COSTS OF REVENUE
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17,268,762 | 22,781,971 | ||||||
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GROSS PROFIT
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17,648,040 | 24,378,519 | ||||||
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OPERATING EXPENSES
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General and administrative
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4,546,970 | 4,632,066 | ||||||
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Sales and marketing
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1,079,567 | 1,161,156 | ||||||
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Product development and enhancement
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1,168,973 | 723,030 | ||||||
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INCOME BEFORE OTHER INCOME (EXPENSES) AND INCOME TAXES
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10,852,530 | 17,862,267 | ||||||
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Foreign exchange gain (loss)
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56,892 | (205,472 | ) | |||||
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Other expense
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- | (5,549 | ) | |||||
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Interest income
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128,863 | 48,330 | ||||||
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INCOME BEFORE INCOME TAXES
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11,038,285 | 17,699,576 | ||||||
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Income tax expense
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Current
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4,023,193 | 5,203,025 | ||||||
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Deferred
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287,377 | 2,497,586 | ||||||
| 4,310,570 | 7,700,611 | |||||||
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NET INCOME
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$ | 6,727,715 | $ | 9,998,965 | ||||
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OTHER COMPREHENSIVE INCOME
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Unrealized foreign exchange (loss) gain on translation of foreign operations
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(120,946 | ) | 244,469 | |||||
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TOTAL COMPREHENSIVE INCOME
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$ | 6,606,769 | $ | 10,243,434 | ||||
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EARNINGS PER SHARE, basic
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$ | 0.24 | $ | 0.37 | ||||
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EARNINGS PER SHARE, diluted
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$ | 0.23 | $ | 0.36 | ||||
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WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING,
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||||||||
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Basic
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28,213,961 | 27,342,799 | ||||||
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Diluted
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29,123,877 | 27,844,113 | ||||||
Cont’d
LML PAYMENT SYSTEMS INC.
CONSOLIDATED STATEMETNS OF FINANCIAL POSITION
(In U.S. Dollars)
(Unaudited)
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March 31,
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March 31,
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April 1,
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2012
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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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$ | 26,783,754 | $ | 26,917,491 | $ | 5,804,752 | ||||||
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Funds held for merchants
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9,485,182 | 7,164,420 | 5,084,752 | |||||||||
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Short-term investments
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3,290,393 | - | - | |||||||||
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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 $27,397 (2011: $28,152; April 1, 2010: $31,463)
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1,602,485 | 1,103,529 | 799,584 | |||||||||
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Corporate taxes receivable
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373,939 | 101,162 | 1,072,930 | |||||||||
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Prepaid expenses
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331,361 | 266,066 | 416,507 | |||||||||
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Total current assets
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42,042,114 | 35,727,668 | 13,338,536 | |||||||||
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Property and equipment, net
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121,496 | 163,222 | 219,580 | |||||||||
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Patents
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120,457 | 287,877 | 455,304 | |||||||||
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Restricted cash
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258,095 | 262,644 | 255,247 | |||||||||
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Deferred tax assets
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809,951 | 1,189,747 | 3,687,333 | |||||||||
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Goodwill
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17,874,202 | 17,874,202 | 17,874,202 | |||||||||
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Other intangible assets
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3,720,037 | 4,215,187 | 4,710,337 | |||||||||
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Other assets
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20,796 | 21,041 | 20,641 | |||||||||
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Total assets
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$ | 64,967,148 | $ | 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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$ | 720,666 | $ | 702,820 | $ | 836,274 | ||||||
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Accrued liabilities
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1,445,490 | 1,390,847 | 1,040,443 | |||||||||
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Corporate taxes payable
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465,044 | 4,796,157 | - | |||||||||
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Funds due to merchants
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9,485,182 | 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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1,371,096 | 1,420,228 | 1,325,983 | |||||||||
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Total current liabilities
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13,489,938 | 15,476,932 | 9,018,647 | |||||||||
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Obligations under finance lease
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4,920 | 7,380 | 9,840 | |||||||||
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Deferred revenue
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- | 935,979 | 2,155,162 | |||||||||
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Total liabilities
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13,494,858 | 16,420,291 | 11,183,649 | |||||||||
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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, $1.00 CDN par value, 150,000,000 shares authorized, issuable in series, none issued or outstanding
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- | - | - | |||||||||
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Common shares, no par value, 100,000,000 shares authorized, 28,246,684 issued and outstanding (2011: 28,127,184; April 1, 2010: 27,241,408)
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53,918,912 | 53,557,276 | 50,152,385 | |||||||||
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Contributed surplus
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10,001,594 | 8,819,006 | 7,987,727 | |||||||||
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Warrants
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113,662 | 113,662 | 649,500 | |||||||||
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Deficit
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(12,835,486 | ) | (19,563,201 | ) | (29,562,166 | ) | ||||||
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Accumulated other comprehensive income
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273,608 | 394,554 | 150,085 | |||||||||
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Total equity
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51,472,290 | 43,321,297 | 29,377,531 | |||||||||
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Total liabilities and equity
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$ | 64,967,148 | $ | 59,741,588 | $ | 40,561,180 | ||||||
Cont’d
LML PAYMENT SYSTEMS INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In U.S. Dollars)
(Unaudited)
|
Years ended March 31,
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2012
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2011
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OPERATING ACTIVITIES:
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Net income
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$ | 6,727,715 | $ | 9,998,965 | ||||
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Adjustments to reconcile net income to net cash provided by operating activities
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Depreciation of property and equipment
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104,750 | 124,070 | ||||||
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Amortization of intangible assets
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662,570 | 662,576 | ||||||
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Share-based payments
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1,317,384 | 1,451,685 | ||||||
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Deferred taxes
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287,377 | 2,497,586 | ||||||
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Foreign exchange loss (gain)
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889 | (3,592 | ) | |||||
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Changes in non-cash operating working capital
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Accounts receivable
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(526,469 | ) | (262,848 | ) | ||||
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Corporate taxes receivable
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(275,606 | ) | 1,002,041 | |||||
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Prepaid expenses
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(68,083 | ) | 154,307 | |||||
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Accounts payable and accrued liabilities
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107,042 | 170,393 | ||||||
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Corporate taxes payable
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(4,236,314 | ) | 4,796,157 | |||||
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Deferred revenue
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(978,571 | ) | (1,133,735 | ) | ||||
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Net cash provided by operating activities
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3,122,684 | 19,457,605 | ||||||
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INVESTING ACTIVITIES:
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Acquisition of short-term investments
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(3,294,525 | ) | - | |||||
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Acquisition of property and equipment
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(65,002 | ) | (63,473 | ) | ||||
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Net cash used in investing activities
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(3,359,527 | ) | (63,473 | ) | ||||
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FINANCING ACTIVITIES:
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Principal payments on finance leases
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(2,460 | ) | (11,047 | ) | ||||
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Proceeds from exercise of stock options
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226,840 | 1,126,648 | ||||||
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Proceeds from exercise of warrants
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- | 1,122,000 | ||||||
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Net cash provided by financing activities
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224,380 | 2,237,601 | ||||||
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Effects of foreign exchange rate changes on cash and cash equivalents
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(121,274 | ) | 215,995 | |||||
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(DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS
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(133,737 | ) | 21,847,728 | |||||
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Cash and cash equivalents, beginning of year
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26,917,491 | 5,069,763 | ||||||
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Cash and cash equivalents, end of year
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$ | 26,783,754 | $ | 26,917,491 | ||||
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Cash and cash equivalents consist of:
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Cash
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$ | 24,908,396 | $ | 22,091,702 | ||||
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Money market fund
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109,988 | 109,905 | ||||||
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Commercial paper
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1,765,370 | 4,715,884 | ||||||
| $ | 26,783,754 | $ | 26,917,491 | |||||
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CONTACTS:
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Patrick H. Gaines - CEO
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Investor Relations
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(640) 689-4440
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(800) 888-2260
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###