VersaPay Announces 2011 Year End Results
APR 27, 2012 - 17:04 ET
TORONTO, ONTARIO--(Marketwire - April 27, 2012) - VersaPay Corporation (TSX VENTURE:VPY) ("VersaPay" or the "Company"), a provider of merchant credit and debit card payment processing and e-mail money transfer (EMT) solutions, today announced its financial and operational results for the year ended December 31, 2011. All amounts are in Canadian dollars unless otherwise noted.
Fiscal 2011 Highlights
Q4 2011 Financial Summary2
"We are very pleased with our financial and business results for fiscal 2011. We were able to grow our recurring revenue base, improve our adjusted EBITDA results and win several important new client relationships," commented Bill McGill, CEO of VersaPay. "We have carried this momentum into the current fiscal year with the announcement of a number of new important partnerships, including Hockey Canada and Wave Accounting. We also improved our balance sheet through a $2 million equity offering, allowing us to expand our investment in sales and marketing, product development and customer care. Looking ahead, we believe we are well positioned to continue to grow and gain market share in the payment processing market."
Bill McGill added, "The fourth quarter is traditionally a slower quarter for our business, yet we were able to maintain year over year double-digit top-line growth. This was also the only quarter during fiscal 2011 where our adjusted EBITDA results did not improve year over year, however this was the result of a number of one- time expenses, without which we would have seen year over year improvement."
Q4 2011 Financial Review
Total revenue for Q4 2011 increased 11% to $3.7 million from $3.4 million in Q4 2010. Of this amount, recurring revenue for Q4 2011 increased 13% to $3.7 million from $3.3 million in Q4 2010. The year-over- year improvement was driven primarily by growth in the Company's transaction processing fees.
Cash operating expense (excluding amortization and share-based payments) increased 15% to $1.0 million from $0.9 million in Q4 2011 from the same period 2010.
Adjusted EBITDA for Q4 2011 was $(0.2) million, and is consistent with Q4 2010 of $(0.2) million.
Loss from continuing operations for Q4 2011 was $(0.4) million. This compares to a loss from continuing operations of $(0.3) million for Q4 2010.
Total revenue for 2011 increased 19% to $15.1 million from $12.7 million in 2010. Of this amount, recurring revenue for 2011 increased 22% to $14.9 million from $12.2 million in 2010. The year-over-year improvement was driven primarily by growth in the Company's transaction processing fees.
Cash operating expense (excluding amortization and share-based payments) decreased 22% to $3.6 million from $4.6 million for 2011 versus 2010. The decrease in cash operating costs over 2010 primarily relates to 2010 having additional costs from the Company becoming publicly traded and the implementation of cost control measures in 2011.
Adjusted EBITDA for 2011 was $(0.4) million, compared to $(1.4) million in 2010.
Loss from continuing operations for 2011 was $(0.9) million, versus a loss of $(2.4) million from the prior year.
As at December 31, 2011 VersaPay had cash $0.6 million, compared to $1.1 million as at December 31, 2010.
1 Adjusted EBITDA is defined as Earnings Before Interest, Taxes, Depreciation, Amortization and Share-based payments. See table A.
2 A complete set of financial statements and notes and MD&A for the year ended December 31, 2011 will be available on the Company's website at www.versapay.com and on SEDAR.
3 Defined as Transaction processing fees + VersaCard/EMT fees
4 Defined as Product sales (point-of-sale devices) and other
5 Defined as operating expense excluding amortization and share-based payments
VersaPay's financial technology enables businesses and consumers across Canada to accept and process credit, debit and gift card transactions. As a payment services and financial technology company serving more than 2,500 Canadian businesses, VersaPay, in conjunction with its partners, provides the hardware, technology, infrastructure and support services that businesses of all types require to accept and process electronic payments from their consumers and clients.
While its core business is payment processing services, VersaPay also provides enhanced financial technology solutions such as VersaPay EMT - the Company's proprietary Electronic Bill Presentment and Payment solution - which enables merchants and consumers to easily transact with one another.
VersaPay is headquartered in Vancouver, Canada and has operations in Toronto and Montreal. To learn more about VersaPay, visit http://www.versapay.com.
Forward Looking and Other Cautionary Statements
This news release contains forward-looking statements and information that are based on the beliefs of management and reflect the Company's current expectations. When used in this news release, the words "estimate", "project", "belief", "anticipate", "intend", "expect", "plan", "predict", "may" or "should" and the negative of these words or such variations thereon or comparable terminology, are intended to identify forward-looking statements and information. Such statements and information reflect the current view of the Company with respect to risks and uncertainties that may cause actual results to differ materially from those contemplated in those forward-looking statements and information.
By their nature, forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements, or other future events, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, risks relating to the speculative nature of the Company's business, the Company's formative stage of development and the Company's financial position. Forward-looking statements are made based on management's beliefs, estimates and opinions on the date that statements are made and the Company undertakes no obligation to update forward looking statements if these beliefs, estimates and opinions or other circumstances should change.
Investors are cautioned against attributing undue certainty to forward-looking statements. There are a number of important factors that could cause the Company's actual results to differ materially from those indicated or implied by forward-looking statements and information. Such factors include, among others, risks related to following: the Company's financial position and the potential need for future financings, the ability of the Company to maintain its relationship with its strategic partner for payment processing, the efforts and abilities of the senior management team, the ability of the Company to attract and retain skilled management, competition in the payment processing industry, and the Company's ability to respond to technological change and protect its intellectual property rights.
The Company cautions that the foregoing list of material factors is not exhaustive. When relying on the Company's forward-looking statements and information to make decisions, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. The Company has assumed a certain progression, which may not be realized. It has also assumed that the material factors referred to in the previous paragraph will not cause such forward-looking statements and information to differ materially from actual results or events. There can be no assurance that such assumptions will reflect the actual outcome of such items or factors.
THE FORWARD-LOOKING INFORMATION CONTAINED IN THIS NEWS RELEASE REPRESENTS THE EXPECTATIONS OF THE COMPANY AS OF THE DATE OF THIS NEWS RELEASE AND, ACCORDINGLY, IS SUBJECT TO CHANGE AFTER SUCH DATE. READERS SHOULD NOT PLACE UNDUE IMPORTANCE ON FORWARD-LOOKING INFORMATION AND SHOULD NOT RELY UPON THIS INFORMATION AS OF ANY OTHER DATE. WHILE THE COMPANY MAY ELECT TO, IT DOES NOT UNDERTAKE TO UPDATE THIS INFORMATION AT ANY PARTICULAR TIME EXCEPT AS REQUIRED IN ACCORDANCE WITH APPLICABLE SECURITIES LEGISLATION.