U.S. Wireless Data Reports Improved Financial Results in Fiscal Third Quarter 2001
NEW YORK--(BUSINESS WIRE)--May 15, 2001--U.S. Wireless Data, Inc. (USWD) (OTC: USWE), the leader in wireless payment transaction services, today released operating results for the third quarter and nine months of fiscal 2001, ended March 31, 2001.
The company reported record year over year increases in revenue, active sites, transactions, resellers, and merchants. These results include the acquisitions of NXT Corporation and CellGate Technologies LLC, which closed in the second quarter, ended December 31, 2000.
Revenue
USWD recorded improved revenues for the three and nine months ended March 31, 2001 of $1,634,000 and $2,118,000, respectively, as compared to $199,000 and $467,000 for the same periods of fiscal 2000. This improvement from the prior year represents a 7-fold increase for the quarter and a 4-fold increase for the nine months. The results include activation fees of $119,000 and $182,000, respectively, versus $30,000 and $54,000, representing a 4-fold increase for the quarter and a 3-fold increase for the nine months, from comparable periods last year. Recurring revenue from monthly service fees increased to $378,000 and $599,000 from $55,000 and $129,000 for the same periods last year. This increase was nearly a 6-fold increase for the quarter and a 5-fold increase for the nine months. The increase in revenues is attributable primarily to the acquisitions noted above.
Net Loss/EBITDA
The company reported a net loss of ($0.49) and ($1.22) per share for the quarter and the nine months, as compared with ($7.54) and
($9.32) per share net loss in the same periods last year. Excluding a non-cash "preferred stock dividend" charge related to the company's March 2000 private placement, the net loss was ($0.37) and ($1.05) per share for the three and nine months for fiscal 2000. EBITDA (earnings or loss before interest, taxes, depreciation, amortization, dividends, and non-cash compensation expenses) for the quarter and the nine months was a loss of ($0.38) and ($0.98) per share versus ($0.33) and
($0.93) per share in the same period last year.
Operating Highlights
The company has made significant progress on its key business objectives. These objectives are intended to establish the company's Synapse(SM) service as the standard for wireless and other IP-based transaction processing services. Operating highlights as of March 31, 2001 include:
-- Signed reseller agreements exceed 140, including 7 of the top
10 merchant acquirers in the country.
-- Active wireless sites using Synapse(SM) equipment and services
increased 180%, to 5,400 from 1,864 during the same period
last year.
-- Transactions processed through Synapse(SM) increased 41% since
December 31, 2000, to 695,000 from 494,000.
-- NXT Gateway Services sites (traditional dial-up and dedicated
lines) increased 7%, to 44,600 from 39,000 during the same
period last year, an increase of over 5,600 sites or 14%.
-- NXT Gateway Services transactions increased 29%, to 125
million from 97 million during the same period last year.
-- Successful integration and consolidation of the NXT
Corporation and CellGate Technologies LLC acquisitions.
-- Continued penetration of new vertical markets, including ATMs,
quick-service restaurants, taxis, vending machines, retail
outlets and sports arenas.
"We are pleased to report that our efforts to negotiate reseller agreements are now beginning to generate revenue growth," said Chairman and CEO, Dean M. Leavitt. "With these agreements established, our emphasis has now turned to building recurring service revenues. One indicator of future transactions is the solid growth in activation fees. These revenues represent the initial charge to establish our service, and thus are a precursor to future recurring revenue. We expect revenue growth to continue as the number of active Synapse terminals increases.
"In addition, the technology acquired from NXT enables us to provide our services through landline and broadband platforms, in addition to our wireless access. With the combination of our three complementary technologies, we can serve the full range of payment transactions. The acquisition of NXT also expands our technical capabilities to convert traditional dial-up and leased-line based point of sale terminals to IP-enabled sites. This establishes USWD's leadership position in facilitating the evolution of wireless data transport from a niche technology to a viable and cost-saving alternative to landline technology. Together, these capabilities substantially extend the potential use of card acceptance and other data transport services to a wide range of new applications."
Discussing financial results, CFO Rick DeVincenzo said, "We have made significant progress in revenue growth and expense reductions, while integrating our recent acquisitions. We have successfully implemented our acquisition integration and consolidation plan, which is expected to reduce overall operating expenses on a monthly basis by approximately $350,000, or $4,200,000 on an annual basis. This represents a reduction of approximately 16%. These savings are in the form of personnel, professional fees, rent, and various other reductions throughout the organization. Our current monthly consolidated losses before interest, taxes, depreciation, and amortization (EBITDA) are approximately ($1,400,000). We expect the EBITDA loss to improve to under ($1,000,000) per month, due to expense reductions and modest revenue growth, by the beginning of the new fiscal year on July 1, 2001. With $22 million in available cash, we are well positioned from a financial standpoint to continue to execute our business plan." |
