Strong Revenue Growth and Margin Expansion
Significant New Partnerships with Financial Institutions, FinTechs and Retailers
Third Quarter 2019 Highlights:
- Total revenues of
$351.5 million , up 3% from$340.2 million in the prior year, and up 6% on a constant-currency basis. - ATM operating revenues of
$333.4 million , up 1% from$329.8 million in the prior year and up 3% on a constant-currency basis. - GAAP Net Income of
$20.9 million , or$0.46 per diluted share, compared to$8.8 million , or$0.19 per diluted share in the prior year. - Adjusted EBITDA of
$87.1 million , up 13% from$77.4 million in the prior year, and up 15% on a constant- currency basis. - Adjusted EBITDA margin of 24.8%, up 200 basis points from the prior year.
- Adjusted Net Income per diluted share of
$0.79 , up 27%. - Cash flow from operations of
$176.5 million compared to$74.8 million in the prior year driven by a significant increase in restricted cash and corresponding liabilities. - Adjusted free cash flow of
$48.2 million compared to$47.8 million in the prior year. - Executed agreements to place over 1,000 ATMs.
- Significant renewal and expansion with leading retail partner
Rite Aid . - New branding agreement with USAA to place their brand on over 5,000 ATMs in select Allpoint locations.
- Significant expansion of partnerships with leading
FinTech operators for Allpoint network access. - Repurchased over one million shares during the three months ended
September 30, 2019 and completed the previously announced$50 million share repurchase authorization, cumulatively acquiring 1.7 million shares or nearly 4% of shares outstanding.
“The third quarter results were highlighted by solid revenue and profit growth in both our
See Disclosure of Non-GAAP Financial Information in this earnings release for definitions of Adjusted Gross Profit, Adjusted Gross Margin, EBITDA, Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net Income, Adjusted Net Income per diluted share (may also be referred to by the Company as "Adjusted EPS"), Adjusted Free Cash Flow, and certain other financial measures recognized under generally accepted accounting principles in the U.S. (“U.S. GAAP” or “GAAP”) and other non-GAAP measures that are used by management on a constant-currency basis. For additional information, including reconciliations to the most directly comparable GAAP measure, see the supplemental schedules of selected financial information in this earnings release.
The Company may also refer to revenue or profit growth as being organic. When providing growth measures on an organic basis, the Company aims to exclude the estimated impact from any acquired or divested businesses that may be included or partially included in one period but not another. The Company may further adjust organic performance measures for the impacts of currency movements, in order to have a consistent performance comparison across periods for the business, excluding movements in exchange rates.
2019 Outlook
The Company is updating its financial outlook for the year ending December 31, 2019 and now expects the following:
- Revenues of
$1.34 billion to $1.36 billion ; - GAAP net income of
$46 million to $49 million ; - Adjusted EBITDA of
$302 million to $310 million ; - Depreciation and accretion expense of
$134 million to $136 million ; - Cash interest expense of
$26 to $27 million ; - Adjusted net income of
$108 million to $112 million ; - Adjusted net income per diluted share of
$2.35 to $2.44 based on approximately 46.0 million average diluted shares outstanding; and - Capital expenditures of approximately
$130 million .
The Adjusted EBITDA and Adjusted Net Income outlook excludes the impact of certain expenses, as outlined in the reconciliation provided at the end of this earnings release. See Disclosure of Non-GAAP Financial Information in this earnings release for definitions of these Non-GAAP measures. This outlook is based on average foreign currency exchange rates for the remainder of 2019 of £1.00
CONFERENCE CALL INFORMATION
The Company will host a conference call today, Wednesday, October 30, 2019, at
Dial in: | (877) 303-9205 | |
Alternate dial-in: | (760) 536-5226 |
Please call in 15 minutes prior to the scheduled start time and request to be connected to the “Cardtronics Third Quarter 2019 Earnings Conference Call.” Additionally, a live audio webcast of the conference call will be available online through the investor relations section of the Company’s website at www.cardtronics.com.
A digital replay of the conference call will be available through November 6, 2019, and can be accessed by calling (855) 859-2056 or (404) 537-3406 and entering 7891475 for the conference ID. A replay of the conference call will also be available online through the Company’s website subsequent to the call through November 30, 2019. Prior to the conference call, the Company will post supplemental financial information to its website at www.cardtronics.com.
ABOUT
CONTACT INFORMATION
EVP - Treasurer
832-308-4000
ir@cardtronics.com
Chief Marketing Officer
832-308-4000
pwilmore@cardtronics.com
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This earnings release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, as amended and are intended to be covered by the safe harbor provisions thereof. These forward-looking statements are based on management’s current expectations and beliefs concerning future developments and their potential effect on the Company and there can be no assurance that future developments affecting the Company will be those that are anticipated. All comments concerning the Company’s expectations for future revenues and operating results are based on its estimates for its existing operations and do not include the potential impact of any future acquisitions. The Company’s forward-looking statements involve significant risks and uncertainties (some of which are beyond its control) and assumptions that could cause actual results to differ materially from its historical experience and present expectations or projections. Risk factors are described in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018, and those set forth from time-to-time in other filings with the
DISCLOSURE OF NON-GAAP FINANCIAL INFORMATION
In order to assist readers of our consolidated financial statements in understanding the operating results that management uses to evaluate the business and for financial planning purposes, the Company presents the following non-GAAP measures as a complement to financial results prepared in accordance with U.S. GAAP: Adjusted Gross Profit, Adjusted Gross Margin, EBITDA, Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net Income, Adjusted Tax Rate, Adjusted Net Income per diluted share, Adjusted Free Cash Flow, and certain other results presented on a constant-currency basis. Management believes that the presentation of these measures and the identification of notable, non-cash, non-operating costs, and/or (if applicable in a particular period) certain costs not anticipated to occur in future periods enhance an investor’s understanding of the underlying trends in the Company’s business and provide for better comparability between periods in different years. Management also believes that these measures are relevant and provide useful information widely used by analysts, investors and other interested parties in the Company’s industry to provide a baseline for evaluating and comparing our operating performance and, in the case of free cash flow, our liquidity results. Management uses these non-GAAP financial measures in managing and measuring the performance of the business, including setting and measuring incentive based compensation.
The non-GAAP financial measures presented herein should not be considered in isolation or as a substitute for operating income, net income, cash flows from operating, investing, or financing activities, or other income or cash flow measures prepared in accordance with GAAP. Reconciliations of the non-GAAP financial measures used herein to the most directly comparable GAAP financial measures are presented in tabular form at the end of this earnings release. In addition, the non-GAAP measures that are used by the Company are not defined in the same manner by all companies and therefore may not be comparable to other similarly titled measures of other companies. Furthermore, the non-GAAP measures presented herein should not be considered in isolation or as a substitute for operating income, net income, cash flows from operating, investing or financing activities, or other income or cash flow measures contained within our financial statements.
Adjusted Gross Profit and Adjusted Gross Margin
Adjusted Gross Profit represents total revenues less the total cost of revenues, excluding depreciation, accretion, and amortization of intangible assets. Adjusted Gross Margin is calculated by dividing Adjusted Gross Profit by total revenues.
EBITDA, Adjusted EBITDA and Adjusted EBITDA Margin
EBITDA is calculated by adding interest expense, income tax expense, depreciation and accretion and amortization to net income. EBITDA and Adjusted EBITDA exclude these items as these amounts can vary substantially from company to company within the Company’s industry depending upon capital structures, tax jurisdictions, accounting methods, the book values of assets and the methods by which the assets were acquired. Adjusted EBITDA also excludes certain non-cash, non-operating costs and/or (if applicable in a particular period) certain costs not anticipated to occur in future periods. These excluded items consist of share-based compensation expense, acquisition and divestiture-related expenses, restructuring expenses, gains or losses on disposal and impairment of assets and other income and expense. Adjusted EBITDA is also calculated to exclude amounts attributable to noncontrolling interests. Adjusted EBITDA Margin is calculated as Adjusted EBITDA divided by total revenues.
Adjusted Net Income, Adjusted Net Income per Diluted Share and Adjusted Tax Rate
Adjusted Net Income represents net income computed in accordance with GAAP, before amortization of intangible assets and deferred financing costs, gains or losses on disposal and impairment of assets, share-based compensation expense, certain other income and expense amounts, acquisition and divestiture-related expenses, certain non-operating expenses, and (if applicable in a particular period) certain costs not anticipated to occur in future periods (together, the “Adjustments”). The non-GAAP tax rate used to calculate Adjusted Net Income was approximately 23.7% and 23.4% for the three and nine months ended September 30, 2019, respectively, and 24.6% and 24.9% for three and nine months ended
Adjusted Free Cash Flow
Adjusted Free Cash Flow is defined as cash provided by operating activities less the impact of changes in restricted cash due to the timing of payments of restricted cash liabilities and less payments for capital expenditures, including those financed through direct debt, but excluding acquisitions. The Adjusted Free Cash Flow measure does not take into consideration certain other non-discretionary cash requirements such as mandatory principal payments on portions of the Company’s long-term debt.
Constant-Currency
Management calculates certain GAAP as well as non-GAAP measures on a constant-currency basis using the average foreign currency exchange rates applicable in the corresponding period of the previous year and applying these rates to the measures in the current reporting period to assess performance and eliminate the effect foreign currency exchange rates have on comparability between periods.
Consolidated Statements of Operations
For the Three and Nine Months Ended September 30, 2019 and 2018
(In thousands, excluding share, per share amounts, and percentages)
(Unaudited)
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||||
2019 | 2018 | % Change | 2019 | 2018 | % Change | |||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||
ATM operating revenues | $ | 333,384 | $ | 329,837 | 1.1 | % | $ | 959,067 | $ | 978,789 | (2.0 | )% | ||||||||||||||
ATM product sales and other revenues | 18,123 | 10,338 | 75.3 | 51,531 | 38,557 | 33.6 | ||||||||||||||||||||
Total revenues | 351,507 | 340,175 | 3.3 | 1,010,598 | 1,017,346 | (0.7 | ) | |||||||||||||||||||
Cost of revenues: | ||||||||||||||||||||||||||
Cost of ATM operating revenues (excludes depreciation, accretion, and amortization of intangible assets reported separately below) | 208,860 | 216,849 | (3.7 | ) | 623,099 | 647,692 | (3.8 | ) | ||||||||||||||||||
Cost of ATM product sales and other revenues | 14,922 | 8,680 | 71.9 | 41,148 | 31,528 | 30.5 | ||||||||||||||||||||
Total cost of revenues | 223,782 | 225,529 | (0.8 | ) | 664,247 | 679,220 | (2.2 | ) | ||||||||||||||||||
Operating expenses: | ||||||||||||||||||||||||||
Selling, general, and administrative expenses | 46,257 | 41,896 | 10.4 | 131,912 | 124,564 | 5.9 | ||||||||||||||||||||
Restructuring expenses | 3,583 | 1,058 | 238.7 | 7,046 | 5,534 | 27.3 | ||||||||||||||||||||
Acquisition related expenses | — | — | n/m | — | 2,633 | n/m | ||||||||||||||||||||
Depreciation and accretion expense | 33,466 | 30,647 | 9.2 | 99,644 | 93,453 | 6.6 | ||||||||||||||||||||
Amortization of intangible assets | 12,404 | 12,994 | (4.5 | ) | 37,407 | 40,263 | (7.1 | ) | ||||||||||||||||||
Loss on disposal and impairment of assets | 637 | 466 | 36.7 | 3,101 | 15,583 | (80.1 | ) | |||||||||||||||||||
Total operating expenses | 96,347 | 87,061 | 10.7 | 279,110 | 282,030 | (1.0 | ) | |||||||||||||||||||
Income from operations | 31,378 | 27,585 | 13.8 | 67,241 | 56,096 | 19.9 | ||||||||||||||||||||
Other expenses: | ||||||||||||||||||||||||||
Interest expense, net | 6,751 | 8,852 | (23.7 | ) | 20,265 | 27,185 | (25.5 | ) | ||||||||||||||||||
Amortization of deferred financing costs and note discount | 3,377 | 3,397 | (0.6 | ) | 9,999 | 10,060 | (0.6 | ) | ||||||||||||||||||
Other income | (3,703 | ) | (1,297 | ) | 185.5 | (9,454 | ) | (1,324 | ) | 614.0 | ||||||||||||||||
Total other expenses | 6,425 | 10,952 | (41.3 | ) | 20,810 | 35,921 | (42.1 | ) | ||||||||||||||||||
Income before income taxes | 24,953 | 16,633 | 50.0 | 46,431 | 20,175 | 130.1 | ||||||||||||||||||||
Income tax expense | 4,086 | 7,854 | (48.0 | ) | 10,780 | 10,409 | 3.6 | |||||||||||||||||||
Effective tax rate | 16.4 % | 47.2 % | 23.2 % | 51.6 % | ||||||||||||||||||||||
Net income | 20,867 | 8,779 | 137.7 | 35,651 | 9,766 | 265.1 | ||||||||||||||||||||
Net income (loss) attributable to noncontrolling interests | 3 | (2 | ) | n/m | (3 | ) | (14 | ) | n/m | |||||||||||||||||
Net income attributable to controlling interests and available to common shareholders | $ | 20,864 | $ | 8,781 | 137.6 | $ | 35,654 | $ | 9,780 | 264.6 | ||||||||||||||||
Net income per common share – basic | $ | 0.46 | $ | 0.19 | $ | 0.77 | $ | 0.21 | ||||||||||||||||||
Net income per common share – diluted | $ | 0.46 | $ | 0.19 | $ | 0.77 | $ | 0.21 | ||||||||||||||||||
Weighted average shares outstanding – basic | 45,058,226 | 46,073,739 | 46,040,027 | 45,945,728 | ||||||||||||||||||||||
Weighted average shares outstanding – diluted | 45,504,165 | 46,476,787 | 46,475,353 | 46,386,523 |
Condensed Consolidated Balance Sheets
As of September 30, 2019 and December 31, 2018
(In thousands)
September 30, 2019 | December 31, 2018 | |||||
(Unaudited) | ||||||
ASSETS | ||||||
Current assets: | ||||||
Cash and cash equivalents | $ | 26,534 | $ | 39,940 | ||
Accounts and notes receivable, net | 95,116 | 75,643 | ||||
Inventory, net | 13,405 | 11,392 | ||||
Restricted cash | 178,748 | 155,470 | ||||
Prepaid expenses, deferred costs, and other current assets | 71,962 | 84,386 | ||||
Total current assets | 385,765 | 366,831 | ||||
Property and equipment, net | 445,857 | 460,187 | ||||
Intangible assets, net | 123,420 | 150,847 | ||||
Goodwill | 744,898 | 749,144 | ||||
Operating lease assets | 82,222 | — | ||||
Deferred tax asset, net | 13,410 | 8,658 | ||||
Prepaid expenses, deferred costs, and other noncurrent assets | 33,521 | 51,677 | ||||
Total assets | $ | 1,829,093 | $ | 1,787,344 | ||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||
Current liabilities: | ||||||
Current portion of other long-term liabilities | $ | 46,726 | $ | 20,266 | ||
Accounts payable and other accrued and current liabilities | 465,840 | 408,470 | ||||
Total current liabilities | 512,566 | 428,736 | ||||
Long-term liabilities: | ||||||
Long-term debt | 752,920 | 818,485 | ||||
Asset retirement obligations | 52,949 | 54,413 | ||||
Noncurrent operating lease liabilities | 74,064 | — | ||||
Deferred tax liability, net | 39,160 | 41,198 | ||||
Other long-term liabilities | 49,213 | 67,740 | ||||
Total liabilities | 1,480,872 | 1,410,572 | ||||
Shareholders' equity | 348,221 | 376,772 | ||||
Total liabilities and shareholders’ equity | $ | 1,829,093 | $ | 1,787,344 | ||
SELECTED BALANCE SHEET DETAIL:
Long-term debt: | September 30, 2019 | December 31, 2018 | ||||
(In thousands) | ||||||
(Unaudited) | ||||||
Revolving credit facility | $ | 183,947 | $ | 259,081 | ||
1.00% Convertible senior notes (1) | 272,590 | 263,507 | ||||
5.50% Senior notes (1) | 296,383 | 295,897 | ||||
Total long-term debt | $ | 752,920 | $ | 818,485 | ||
(1) The 1.00% Convertible Senior Notes due 2020 with a face value of
Reconciliation of Net Income Attributable to Controlling Interests and Available to Common Shareholders to EBITDA, Adjusted EBITDA, and Adjusted Net Income
For the Three and Nine Months Ended September 30, 2019 and 2018
(In thousands, excluding share and per share amounts)
(Unaudited)
Three Months Ended | Nine Months Ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Net income attributable to controlling interests and available to common shareholders | $ | 20,864 | $ | 8,781 | $ | 35,654 | $ | 9,780 | |||||||
Adjustments: | |||||||||||||||
Interest expense, net | 6,751 | 8,852 | 20,265 | 27,185 | |||||||||||
Amortization of deferred financing costs and note discount | $ | 3,377 | 3,397 | 9,999 | 10,060 | ||||||||||
Income tax expense | 4,086 | 7,854 | 10,780 | 10,409 | |||||||||||
Depreciation and accretion expense | 33,466 | 30,647 | 99,644 | 93,453 | |||||||||||
Amortization of intangible assets | 12,404 | 12,994 | 37,407 | 40,263 | |||||||||||
EBITDA | 80,948 | 72,525 | 213,749 | 191,150 | |||||||||||
Add back: | |||||||||||||||
Loss on disposal and impairment of assets | 637 | 466 | 3,101 | 15,583 | |||||||||||
Other income (1) | (3,703 | ) | (1,297 | ) | (9,454 | ) | (1,324 | ) | |||||||
Noncontrolling interests (2) | 15 | 12 | 46 | 31 | |||||||||||
Share-based compensation expense | 5,633 | 4,669 | 15,367 | 10,627 | |||||||||||
Restructuring expenses (3) | 3,583 | 1,058 | 7,046 | 5,534 | |||||||||||
Acquisition related expenses (4) | — | — | — | 2,633 | |||||||||||
Adjusted EBITDA | 87,113 | 77,433 | 229,855 | 224,234 | |||||||||||
Less: | |||||||||||||||
Interest expense, net | 6,751 | 8,852 | 20,265 | 27,185 | |||||||||||
Depreciation and accretion expense (5) | 33,466 | 30,646 | 99,644 | 93,451 | |||||||||||
Adjusted pre-tax income | 46,896 | 37,935 | 109,946 | 103,598 | |||||||||||
Income tax expense (6) | 11,114 | 9,332 | 25,748 | 25,789 | |||||||||||
Adjusted Net Income | $ | 35,782 | $ | 28,603 | $ | 84,198 | $ | 77,809 | |||||||
Adjusted Net Income per share – basic | $ | 0.79 | $ | 0.62 | $ | 1.83 | $ | 1.69 | |||||||
Adjusted Net Income per share – diluted | $ | 0.79 | $ | 0.62 | $ | 1.81 | $ | 1.68 | |||||||
Weighted average shares outstanding – basic | 45,058,226 | 46,073,739 | 46,040,027 | 45,945,728 | |||||||||||
Weighted average shares outstanding – diluted | 45,504,165 | 46,476,787 | 46,475,353 | 46,386,523 |
(1) Includes foreign currency translation gains/losses, the revaluation of the estimated acquisition related contingent consideration, and other non-operating costs.
(2) Noncontrolling interest adjustment made such that Adjusted EBITDA includes only the Company’s ownership interest in the Adjusted EBITDA of one of its Mexican subsidiaries.
(3) For the three and nine months ended
(4) For the nine months ended
(5) Amounts exclude a portion of the expenses incurred by one of its Mexican subsidiaries to account for the amounts allocable to the noncontrolling interest shareholders.
(6) For the three and nine months ended September 30, 2019, the non-GAAP tax rate used to calculate Adjusted Net Income was 23.7% and 23.4%, respectively. For the three and nine months ended
Reconciliation of U.S. GAAP Revenue to Constant-Currency Revenue
For the Three and Nine Months Ended September 30, 2019 and 2018
(In thousands, excluding percentages)
(Unaudited)
Consolidated revenue: | ||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||
September 30, | ||||||||||||||||||||
2019 | 2018 | % Change | ||||||||||||||||||
U.S. GAAP |
Foreign Currency Impact |
Constant - Currency |
U.S. GAAP |
U.S. GAAP |
Constant - Currency |
|||||||||||||||
ATM operating revenues | $ | 333,384 | $ | 7,441 | $ | 340,825 | $ | 329,837 | 1.1 | % | 3.3 | % | ||||||||
ATM product sales and other revenues | 18,123 | 112 | 18,235 | 10,338 | 75.3 | 76.4 | ||||||||||||||
Total revenues | $ | 351,507 | $ | 7,553 | $ | 359,060 | $ | 340,175 | 3.3 | % | 5.6 | % | ||||||||
Nine Months Ended | ||||||||||||||||||||
September 30, | ||||||||||||||||||||
2019 | 2018 | % Change | ||||||||||||||||||
U.S. GAAP |
Foreign Currency Impact |
Constant - Currency |
U.S. GAAP |
U.S. GAAP |
Constant - Currency |
|||||||||||||||
ATM operating revenues | $ | 959,067 | $ | 27,782 | $ | 986,849 | $ | 978,789 | (2.0 | )% | 0.8 | % | ||||||||
ATM product sales and other revenues | 51,531 | 635 | 52,166 | 38,557 | 33.6 | 35.3 | ||||||||||||||
Total revenues | $ | 1,010,598 | $ | 28,417 | $ | 1,039,015 | $ | 1,017,346 | (0.7 | )% | 2.1 | % | ||||||||
Reconciliation of Gross Profit Inclusive of Depreciation, Accretion, and Amortization of Intangible Assets to Adjusted Gross Profit
For the Three and Nine Months Ended September 30, 2019 and 2018
(In thousands, excluding percentages)
(Unaudited)
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Total revenues | $ | 351,507 | $ | 340,175 | $ | 1,010,598 | $ | 1,017,346 | ||||||||
Total cost of revenues (1) | 223,782 | 225,529 | 664,247 | 679,220 | ||||||||||||
Total depreciation, accretion, and amortization of intangible assets excluded from total cost of revenues | 37,303 | 35,456 | 112,297 | 109,137 | ||||||||||||
Gross profit inclusive of depreciation, accretion, and amortization of intangible assets | 90,422 | 79,190 | 234,054 | 228,989 | ||||||||||||
Gross Margin (inclusive of depreciation, accretion, and amortization of intangible assets) | 25.7 % | 23.3 % | 23.2 % | 22.5 % | ||||||||||||
Total depreciation, accretion, and amortization of intangible assets excluded from gross profit | 37,303 | 35,456 | 112,297 | 109,137 | ||||||||||||
Adjusted Gross Profit exclusive of depreciation, accretion, and amortization of intangible assets | $ | 127,725 | $ | 114,646 | $ | 346,351 | $ | 338,126 | ||||||||
Adjusted Gross Margin (exclusive of depreciation, accretion, and amortization of intangible assets) | 36.3 % | 33.7 % | 34.3 % | 33.2 % |
(1) The Company presents the Total cost of revenues in the Company’s Consolidated Statements of Operations exclusive of depreciation, accretion, and amortization of intangible assets.
Reconciliation of Adjusted EBITDA, Adjusted Net Income, and Adjusted Net Income per diluted share on a Non-GAAP basis to Constant-Currency
For the Three and Nine Months Ended September 30, 2019 and 2018
(In thousands, excluding per share amounts and percentages)
(Unaudited)
Three Months Ended | ||||||||||||||||||
September 30, | ||||||||||||||||||
2019 | 2018 | % Change | ||||||||||||||||
Non - GAAP (1) |
Foreign Currency Impact |
Constant - Currency |
Non - GAAP (1) |
Non - GAAP (1) |
Constant - Currency |
|||||||||||||
Adjusted EBITDA | $ | 87,113 | $ | 2,175 | $ | 89,288 | $ | 77,433 | 12.5 | % | 15.3 | % | ||||||
Adjusted Net Income | $ | 35,782 | $ | 1,004 | $ | 36,786 | $ | 28,603 | 25.1 | % | 28.6 | % | ||||||
Adjusted Net Income per share – diluted (2) | $ | 0.79 | $ | 0.02 | $ | 0.81 | $ | 0.62 | 27.4 | % | 30.6 | % |
Nine Months Ended | ||||||||||||||||||
September 30, | ||||||||||||||||||
2019 | 2018 | % Change | ||||||||||||||||
Non - GAAP (1) |
Foreign Currency Impact |
Constant - Currency |
Non - GAAP (1) |
Non - GAAP (1) |
Constant - Currency |
|||||||||||||
Adjusted EBITDA | $ | 229,855 | $ | 6,340 | $ | 236,195 | $ | 224,234 | 2.5 | % | 5.3 | % | ||||||
Adjusted Net Income | $ | 84,198 | $ | 2,249 | $ | 86,447 | $ | 77,809 | 8.2 | % | 11.1 | % | ||||||
Adjusted Net Income per share – diluted (2) | $ | 1.81 | $ | 0.05 | $ | 1.86 | $ | 1.68 | 7.7 | % | 10.7 | % |
(1) As reported on the Company’s Reconciliation of Net Income Attributable to Controlling Interests and Available to Common Shareholders to EBITDA, Adjusted EBITDA, and Adjusted Net Income, see Disclosure of Non-GAAP Financial Information in this earnings release for further discussion.
(2) Adjusted Net Income per diluted share is calculated by dividing Adjusted Net Income by the weighted average diluted shares outstanding of 45,504,165 and 46,476,787 for the three months ended September 30, 2019 and 2018, respectively, and 46,475,353 and 46,386,523 for the nine months ended
Reconciliation of Adjusted Free Cash Flow
For the Three and Nine Months Ended September 30, 2019 and 2018
(In thousands)
(Unaudited)
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Net cash provided by operating activities | $ | 176,462 | $ | 74,807 | $ | 231,692 | $ | 184,582 | ||||||||
Restricted cash settlement activity (1) | (92,983 | ) | (361 | ) | (22,629 | ) | (25,709 | ) | ||||||||
Adjusted net cash provided by operating activities | 83,479 | 74,446 | 209,063 | 158,873 | ||||||||||||
Net cash used in investing activities, excluding acquisitions (2) | (35,266 | ) | (26,675 | ) | (90,319 | ) | (73,357 | ) | ||||||||
Adjusted free cash flow | $ | 48,213 | $ | 47,771 | $ | 118,744 | $ | 85,516 | ||||||||
(1) Restricted cash settlement activity represents the change in our restricted cash excluding the portion of the change that is attributable to foreign exchange and disclosed as part of the effect of exchange rate changes on cash, cash equivalents, and restricted cash in our Consolidated Statements of Cash Flows. Restricted cash largely consists of amounts collected on behalf of, but not yet remitted to, certain of the Company’s merchant customers or third-party service providers that are pledged for a particular use or restricted to support these obligations.
(2) Capital expenditure amounts include payments made for exclusive license agreements, site acquisition costs, and other assets. Additionally, capital expenditure amounts for one of our Mexican subsidiaries are reflected gross of any noncontrolling interest amounts.
Reconciliation of Estimated Net Income to EBITDA, Adjusted EBITDA, and Adjusted Net Income
For the Year Ending December 31, 2019
(In millions, excluding per share amounts)
(Unaudited)
Estimated Range | ||||||||
Full Year 2019 (1) | ||||||||
Net Income | $ | 46.0 | $ | 49.0 | ||||
Adjustments: | ||||||||
Interest expense, net | 26.4 | 27.2 | ||||||
Amortization of deferred financing costs and note discount | 13.0 | 13.6 | ||||||
Income tax expense | 13.0 | 14.6 | ||||||
Depreciation and accretion expense | 134.0 | 136.0 | ||||||
Amortization of intangible assets | 49.0 | 49.0 | ||||||
EBITDA | 281.4 | 289.4 | ||||||
Add Back: | ||||||||
Loss on disposal of assets and other, net | 3.1 | 3.1 | ||||||
Other income | (9.5 | ) | (9.5 | ) | ||||
Share-based compensation expense | 20.0 | 20.0 | ||||||
Restructuring expenses | 7.0 | 7.0 | ||||||
Adjusted EBITDA | 302.0 | 310.0 | ||||||
Less: | ||||||||
Interest expense, net | 26.4 | 27.2 | ||||||
Depreciation and accretion expense | 134.0 | 136.0 | ||||||
Income tax expense (2) | 33.3 | 34.5 | ||||||
Adjusted Net Income | $ | 108.3 | $ | 112.3 | ||||
Adjusted Net Income per share – diluted | $ | 2.35 | $ | 2.44 | ||||
Weighted average shares outstanding – diluted | 46.0 | 46.0 |
(1) See Disclosure of Non-GAAP Financial Information in this earnings release for definitions of the non-GAAP measures included in this table.
(2) Calculated using the Company’s estimated non-GAAP tax rate of approximately 23.5% as adjusted for items excluded from Adjusted Net Income, see Disclosure of Non-GAAP Financial Information in this earnings release for further discussion.
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Source: Cardtronics USA, Inc.