Coinstar Announces Record Installations, Revenue and Direct Contribution for the Fourth Quarter
February 3, 1998 04:04 PM
BELLEVUE, Wash.--(BUSINESS WIRE)--Feb. 3, 1998--Coinstar, Inc. CSTR today announced its results for the fourth quarter and
year ended Dec. 31, 1997.
Coinstar reported record revenue of $8.0 million for the fourth quarter of 1997, an increase of 138% from $3.3 million for the fourth quarter
of 1996. For the year, the Company reported revenue of $25.0 million, up 201% from $8.3 million for 1996. The significant year-over-year
growth in revenue was a result of continued expansion of Coinstar's network and increased customer use of Coinstar's coin processing units.
During the fourth quarter, Coinstar installed a record 469 units, compared to 292 units installed in the same period of last year. As of Dec.
31, 1997, the Company had 3,204 units in operation, an increase of 113% compared to 1,501 units at year-end 1996. The Company
expanded its network into 5 new regional markets in the fourth quarter, which resulted in a presence in 40 regional markets, up from 23 at
the end of 1996.
Coinstar entered into new partnerships with 14 grocery store chains during the fourth quarter, bringing the total to 76 chains at the end of
1997, compared to 38 chains at the end of 1996. The Company's expansion included new installations in Fred Meyer stores in Portland,
Oregon; Winn-Dixie supermarkets in Jacksonville, Florida; H-E-B Grocery stores in Austin, Texas; and Kroger stores in Louisville and
Lexington, Kentucky.
The Coinstar network processed coins worth a total of $105.7 million during the fourth quarter, up from $44.8 million in the fourth quarter
of 1996. For the year, the Coinstar network of machines processed over $333 million, compared to $115 million for the previous year. To
date, the Coinstar network has processed over $470 million.
For the fourth quarter of 1997, the average revenue per unit on an annualized basis was $10,907, up from $9,623 for the fourth quarter of
1996, as the average age of the units in service increased to 11.7 months compared to 7.0 months.
In general, coin processing volumes per unit have increased with the length of time a unit has been in operation. However, volumes have
historically been higher in the summer months and lower during the winter and fall. Unit volumes may also be affected by other factors
including public relations, advertising and other promotional activities.
During the fourth quarter, the Company achieved a record direct contribution margin of $2.8 million or 35% of total revenue, up from
$409,000 or 12% of total revenue for the fourth quarter of 1996. For the year, the direct contribution margin was $7.1 million or 28%,
compared to $1.0 million or 13% for 1996. This year-over-year increase is a result of growth in per unit coin processing volumes and
improved operating leverage.
For the fourth quarter, the net loss was $7.3 million or ($0.49) per share, compared to a net loss of $7.1 million or ($0.68) per share for the
same period of 1996. The net loss for 1997 was $29.6 million or ($2.41) per share, compared to a net loss of $16.0 million or ($1.53) per
share for 1996.
For the year, approximately 70% of the net loss was generated from non-cash items such as increasing depreciation and interest expense.
The Company's losses also reflect increased expenditures for network operations and infrastructure to support its growth as well as the
growth of its sales and marketing efforts.
"We are extremely pleased with our accomplishments during the year," said Jens Molbak, President and Chief Executive Officer of
Coinstar. "We had a great fourth quarter and continue to leverage our growing network. During the year, we rapidly expanded our network
and improved our operating performance. We also successfully completed our IPO, surpassed 3,000 unit installations and entered 17 new
market regions."
Coinstar develops, owns and operates a network of automated, self-service coin counting and processing machines that provide consumers
with a convenient means to convert loose coins into cash. The Company currently has over 3,200 units operating in supermarkets
throughout the U.S. Coinstar has 270 full-time employees and is headquartered in Bellevue, Wash.
In addition to historical information contained herein, this news release contains forward-looking statements that involve risks and
uncertainties. The Company's future actual results could differ materially from the forward-looking statements discussed herein. Factors that
could cause or contribute to such differences include, but are not limited to, success in the timely deployment of a substantial number of
additional Coinstar units, consumer awareness and demand for the Company's coin processing service, success in expanding its network
and managing its growth and the Company's ability to protect its patents and proprietary rights as well as other risks discussed under "Risk
Factors" included in the Company's Registration Statement, as amended, on Form S-1 (No. 333-26843), and Registration Statement, as
amended, on Form S-4 (No. 333-33233).
Coinstar, Inc.
Selected Financial and Other Data
(in thousands except for per share and other data)
Three months ended Year Ended
Dec. 31, Dec. 31, Dec. 31, Dec. 31,
1997 1996 1997 1996
Statement of Operations Data:
Revenue $ 7,957 $ 3,349 $ 25,007 $ 8,312
Expenses
Direct Operating 5,208 2,940 17,899 7,258
Regional sales
and marketing 689 494 3,088 1,505
Product research
and development 1,644 1,533 6,362 3,969
Selling, general
and administrative 3,252 1,987 11,079 5,351
Depreciation
and amortization 2,539 1,741 8,679 4,134
Loss from operations (5,375) (5,346) (22,100) (13,905)
Other income (expense)
Interest income 598 571 2,329 848
Interest expense (2,564) (2,071) (9,822) (2,661)
Net loss before
extraordinary item (6,846) (15,718)
Extraordinary Item - loss
related to early
retirement of debt (249) (249)
Net Loss (7,341) (7,095) (29,593) (15,967)
Net Loss per share (1) ($0.49) ($0.68) ($2.41) ($1.53)
Weighted shares outstanding 15,029 10,460 12,293 10,460
Other Data:
Number of new Coinstar
units installed in period 469 292 1,703 1,234
Installed base of Coinstar
units at end of period 3,204 1,501 3,204 1,501
Number of regional markets 40 23 40 23
Dollar volume of coins
processed (thousands) $ 105,692 $ 44,841 $ 332,541 $ 115,476
Capital
expenditures (thousands) 4,756 5,676 28,188 20,820
Direct
contribution(2) (thousands) 2,749 409 7,108 1,054
Annualized revenue per
average installed unit 10,907 9,623 10,709 9,864
Annualized direct
contribution per average
installed unit 3,768 1,175 3,044 1,250
Average units installed 2,918 1,392 2,344 843
Average age of network
for the period (months) 11.7 7.0 10.0 6.5
(1) Net loss per share amounts are calculated on a proforma basis
assuming the conversion of preferred stock into common stock as if |
