HOUSTON, July 31, 2012 (GLOBE NEWSWIRE) -- Cardtronics, Inc. (Nasdaq:CATM) (the "Company"), the world's largest retail ATM owner, today announced its financial and operational results for the quarter ended June 30, 2012.

Key financial statistics in the second quarter of 2012 as compared to the second quarter of 2011 include:

• Consolidated revenues of $192.0 million, up by 30%, comprised of 12% organic growth and 18% growth from acquisitions completed during 2011.
• Adjusted Net Income per diluted share of $0.38, up 12% from $0.34.
• Adjusted EBITDA of $45.4 million, up 20% from $37.9 million.
• GAAP net income of $9.7 million or $0.21 per diluted share, up from $8.7 million or $0.20 per diluted share.

"On the heels of an exceptional first quarter, we had another really good quarter with continued very strong revenue growth of 30% and adjusted earnings growth of 12%," commented Steve Rathgaber, chief executive officer. "Additionally, we executed several new branding contracts during the quarter with both existing bank partners and new financial institutions that see the value in our leading retail ATM footprint and superior execution capabilities."

RECENT HIGHLIGHTS

• Completion of the installation of over 960 ATMs at Valero Corner Store locations.
• Execution of a bank branding agreement with Frost Bank to brand 615 ATMs located within Valero Corner Stores in Texas.
• Establishment of an ATM branding relationship with Sunbelt-based BBVA Compass, which elected to brand 189 ATMs at major national and regional retailer locations in Colorado and Texas.
• Installation of over 300 ATMs in 7-Eleven stores in Canada.
• Execution of a bank branding agreement with Scotiabank to brand all of the Company's 7-Eleven Canada-located ATMs.
• Execution of a fourth ATM branding agreement with PNC Bank, with this latest relationship expansion covering ATMs at 191 Harris Teeter stores in seven Southeast states, plus Washington, D.C.
• Expansion of an ATM branding relationship established with USAA in 2011, to approximately 400 ATMs located near military bases on both coasts and points in between.
• Installation of approximately 300 ATMs to date in Shell gasoline / convenience store locations in the U.K. under the contract signed in March 2012.
• Net addition of over 1,600 new deployed Company-owned ATMs during the quarter.

Effects of foreign currency exchange rate movements had an insignificant impact on reported revenues, Adjusted EBITDA and Adjusted Net Income per diluted share during the quarter.

Please refer to the "Disclosure of Non-GAAP Financial Information" contained later in this release for definitions of Adjusted EBITDA, Adjusted Net Income, Adjusted Net Income per diluted share and Free Cash Flow. For additional financial information, including reconciliations to comparable GAAP measures, please refer to the supplemental schedules of selected financial information at the end of this release.

SECOND QUARTER RESULTS

For the second quarter of 2012, consolidated revenues totaled $192.0 million, representing a 30% increase from the $147.3 million in consolidated revenues generated during the second quarter of 2011. Of the year-over-year increase, 18% was driven by businesses acquired during the second half of 2011, including EDC, Access to Money, Mr. Cash, and LocatorSearch. Of the remaining 12% organic revenue increase, 9% was attributable to a combination of the following: (1) increased transactions per ATM in the Company's United States and United Kingdom operations; (2) unit growth expansion; (3) increased revenues from managed services agreements; and (4) growth in Allpoint, America's largest surcharge-free network. Partially offsetting the increases in organic revenue was a decline in interchange as a result of rate reductions by a major network that became effective during the quarter. Finally, 3% of the year-over-year increase in consolidated revenues was attributable to higher equipment sales, driven by continued increased demand to meet the new requirements under the Americans with Disabilities Act (ADA).

Adjusted EBITDA for the second quarter of 2012 totaled $45.4 million, compared to $37.9 million during the second quarter of 2011, and Adjusted Net Income totaled $16.7 million ($0.38 per diluted share) compared to $14.4 million ($0.34 per diluted share) during the second quarter of 2011. The increases in Adjusted EBITDA and Adjusted Net Income per diluted share were positively affected by the incremental operations of ATMs acquired during the second half of 2011, as well as the organic revenue growth. Specific costs excluded from Adjusted EBITDA and Adjusted Net Income are detailed in a reconciliation included at the end of this press release.

GAAP Net Income for the second quarter of 2012 totaled $9.7 million, compared to $8.7 million during the same quarter in 2011. The increase in GAAP Net Income for the second quarter of 2012 was affected by the factors discussed above, partly offset by higher intangible asset amortization and interest expense associated with the Company's 2011 acquisitions and higher depreciation expense from new equipment purchases, higher stock-based compensation, and $0.4 million in acquisition-related costs.

SIX MONTHS RESULTS

For the six months ended June 30, 2012, consolidated revenues totaled $383.1 million, representing a 34% increase from the $285.3 million in consolidated revenues generated during the same period in 2011. Of the year-over-year increase, 19% was driven by businesses acquired during the second half of 2011, with the remaining 15% increase attributable to a combination of increases in transactions per ATM, unit growth expansion, increased revenues from managed services agreements, higher equipment sales, and growth in Allpoint.

Adjusted EBITDA totaled $89.9 million for the six months ended June 30, 2012, representing a 26% increase over the $71.4 million in Adjusted EBITDA for the same period in 2011, and Adjusted Net Income totaled $33.5 million ($0.77 per diluted share) for the first six months of 2012, up 26% on a per share basis from $26.0 million ($0.61 per diluted share) during the same period in 2011. The increases in both Adjusted EBITDA and Adjusted Net Income were primarily due to the same factors noted above for the Company's quarterly results.

GAAP Net Income for the six months ended June 30, 2012 totaled $19.5 million, compared to $15.2 million during the same period in 2011. 

Full-Year 2012 Guidance

At this time, the Company is not changing the financial guidance it previously issued in April 2012 regarding its anticipated full-year 2012 results, which was:

• Revenues of $755.0 million to $770.0 million;
• Overall gross margins of approximately 31.2% to 31.8%;
• Adjusted EBITDA of $182.5 million to $189.5 million;
• Depreciation and accretion expense of approximately $56.0 million to $58.0 million, net of noncontrolling interests;
• Cash interest expense of approximately $20.0 million to $21.0 million, net of noncontrolling interests;
• Adjusted Net Income of $1.58 to $1.64 per diluted share, based on approximately 43.9 million weighted average diluted shares outstanding; and
• Capital expenditures of approximately $70.0 million, net of noncontrolling interests.

The Adjusted EBITDA and Adjusted Net Income guidance excludes the impact of $11.4 million of anticipated stock-based compensation expense and $23.3 million of expected intangible asset amortization expense, both on a pre-tax basis. Additionally, this guidance is based on average foreign currency exchange rates for the remainder of the year of $1.55 U.S. to £1.00 U.K., $13.00 Mexican pesos to $1.00 U.S., and $1.00 Canadian dollar to $1.00 U.S.

LIQUIDITY

The Company believes that it has a very strong liquidity position, with $77.7 million in available borrowing capacity under its $250.0 million revolving credit facility as of June 30, 2012. In addition, the size of the amended credit facility can be increased to $325.0 million under certain conditions. The Company's outstanding indebtedness as of June 30, 2012 consisted of $200.0 million in senior subordinated notes due 2018, $170.2 million in borrowings under its revolving credit facility due 2016, and $3.7 million in equipment financing notes associated with its majority-owned Mexico subsidiary. 

DISCLOSURE OF NON-GAAP FINANCIAL INFORMATION

Adjusted EBITDA, Adjusted Net Income, Adjusted Net Income per diluted share and Free Cash Flow are non-GAAP financial measures provided as a complement to results prepared in accordance with accounting principles generally accepted within the United States of America ("GAAP") and may not be comparable to similarly-titled measures reported by other companies. Management believes that the presentation of these measures and the identification of unusual, non-recurring, or non-cash items enhance an investor's understanding of the underlying trends in the Company's business and provide for better comparability between periods in different years.

Adjusted EBITDA excludes depreciation, accretion, and amortization expense as these amounts can vary substantially from company to company within the Company's industry depending upon accounting methods and book values of assets, capital structures, and the method by which the assets were acquired. Adjusted EBITDA also excludes acquisition-related costs, certain other non-operating costs, loss on asset disposal, our obligations for the payment of income taxes, interest expense or other obligations such as capital expenditures, and an adjustment for noncontrolling interest. Adjusted Net Income represents net income computed in accordance with GAAP, before amortization expense, loss on disposal of assets, stock-based compensation expense and certain other expense (income) and acquisition-related costs, and using an assumed 35% tax rate, with certain adjustments for noncontrolling interest. Adjusted Net Income per diluted share is calculated by dividing Adjusted Net Income by average weighted diluted shares outstanding calculated in accordance with GAAP. Free Cash Flow is defined as cash provided by operating activities less payments for capital expenditures, including those financed through direct debt but excluding acquisitions. The measure of Free Cash Flow does not take into consideration certain other non-discretionary cash requirements such as, for example, mandatory principal payments on portions of the Company's long-term debt. 

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 press release.

CONFERENCE CALL INFORMATION

The Company will host a conference call today, Tuesday, July 31, 2012, at 4:00 p.m. Central Time (5:00 p.m. Eastern Time) to discuss its financial results for the quarter ended June 30, 2012. To access the call, please call the conference call operator at:

    Dial in:                    (877) 303-9205
    Alternate dial-in:       (760) 536-5226

Please call in fifteen minutes prior to the scheduled start time and request to be connected to the "Cardtronics Second Quarter 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 Monday, August 13, 2012, and can be accessed by calling (855) 859-2056 or (404) 537-3406 and entering 11253247 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 August 30, 2012.

ABOUT CARDTRONICS (Nasdaq:CATM)

Making ATM cash access convenient where people shop, work and live their lives, Cardtronics is at the convergence of retailers, financial institutions, prepaid card programs and the customers they share. Cardtronics owns/operates approximately 54,900 retail ATMs in U.S. and international locales. Whether Cardtronics is driving foot traffic for America's most relevant retailers, enhancing ATM brand presence for card issuers or expanding card holders' surcharge-free cash access on the local, national or global scene, Cardtronics is convenient access to cash, when and where consumers need it. Cardtronics is where cash meets commerce.

The Cardtronics logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=991

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements give the Company's current expectations or forecasts of future events, future financial performance, strategies, expectations, competitive environment, regulation, and availability of resources. The forward-looking statements contained in this release include, among other things, statements concerning projections, predictions, expectations, estimates or forecasts as to the Company's business, financial and operational results and future economic performance, and statements of management's goals and objectives and other similar expressions concerning matters that are not historical facts. These statements are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. These risks and uncertainties include, but are not limited to, the following:

• the Company's financial outlook and the financial outlook of the ATM industry;
• the Company's ability to respond to recent and future regulatory changes;
• the Company's ability to respond to potential reductions in the amount of interchange fees that it receives from global and regional debit networks for transactions conducted on its ATMs, including a recent change by a major global network that will result in lower fees earned by the Company on transactions processed over this network;
• the Company's ability to provide new ATM solutions to retailers and financial institutions;
• the Company's ATM vault cash rental needs, including potential liquidity issues with its vault cash providers;
• the continued implementation of the Company's corporate strategy;
• the Company's ability to compete successfully with new and existing competitors;
• the Company's ability to renew and strengthen its existing customer relationships and add new customers;
• the Company's ability to meet the service levels required by its service level agreements with its customers;
• the Company's ability to pursue and successfully integrate acquisitions;
• the Company's ability to successfully manage its existing international operations and to continue to expand internationally;
• the Company's ability to prevent security breaches;
• the Company's ability to manage the risks associated with its third-party service providers failing to perform their contractual obligations;
• the Company's ability to manage concentration risks with key customers, vendors and service providers;
• changes in interest rates and foreign currency rates; and
• the additional risks the Company is exposed to in its U.K. armored transport business.

Additional information regarding known material factors that could cause the Company's actual performance or results to differ from its projected results are described in its filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K. You should not read forward-looking statements as a guarantee of future performance or results. They will not necessarily be accurate indications of the times at or by which such performance or results will be achieved. Forward-looking statements speak only as of the date the statements are made and are based on information available at the time those statements are made and/or management's good faith belief as of that time with respect to future events. The Company assumes no obligation to update forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information.

SELECTED INCOME STATEMENT DETAIL:

Total revenues by segment:

Breakout of ATM operating revenues:

Total cost of revenues by segment:

Breakout of cost of ATM operating revenues (exclusive of depreciation, accretion, and amortization):

Breakout of selling, general, and administrative expenses:

Depreciation and accretion expense by segment:

SELECTED BALANCE SHEET DETAIL:

Long-term debt:

Share count rollforward:

SELECTED CASH FLOW DETAIL:

Selected cash flow statement amounts:

⁽¹⁾      Includes 2,650 and 2,498 ATMs for the three months ended June 30, 2012 and 2011, respectively, and 2,627 and 2,502 ATMs for the six months ended June 30, 2012 and 2011, respectively, for which the Company only provided EFT transaction processing services. 

⁽²⁾      Amounts presented exclude the effect of depreciation, accretion, and amortization expense, which is presented separately in the Company's consolidated statements of operations.

⁽³⁾      ATM operating gross profit and ATM operating gross profit margin are measures of profitability that are calculated based on only the revenues and expenses that relate to operating ATMs in the Company's portfolio. Revenues and expenses relating to managed services and ATM equipment sales and other ATM-related services are not included.

⁽¹⁾      Includes 2,650 and 2,498 ATMs for the three months ended June 30, 2012 and 2011, respectively, and 2,627 and 2,502 ATMs for the six months ended June 30, 2012 and 2011, respectively, for which the Company only provided EFT transaction processing services. 

⁽²⁾      Amounts presented exclude the effect of depreciation, accretion, and amortization expense, which is presented separately in the Company's consolidated statements of operations.

⁽³⁾      ATM operating gross profit and ATM operating gross profit margin are measures of profitability that are calculated based on only the revenues and expenses that relate to operating ATMs in the Company's portfolio. Revenues and expenses relating to managed services and ATM equipment sales and other ATM-related services are not included.

⁽¹⁾    Includes 2,685 and 2,511 ATMs as of June 30, 2012 and 2011, respectively for which the Company only provided EFT transaction processing services. Also includes 817 ATMs that as of December 31, 2011, were reported in the United States Merchant-owned category. 

⁽¹⁾       Primarily comprised of losses on the disposal of fixed assets that were incurred with the deinstallation of ATMs during the periods.

⁽²⁾       Amounts exclude unrealized and realized (gains) losses related to derivatives not designated as hedging instruments.

⁽³⁾       Noncontrolling interests adjustment made such that Adjusted EBITDA includes only the Company's 51% ownership interest in the Adjusted EBITDA of its Mexico subsidiary.

⁽⁴⁾       Amounts exclude 49% of the expenses incurred by the Company's Mexico subsidiary as such amounts are allocable to the noncontrolling interest shareholders.

⁽⁵⁾       Acquisition-related costs include non-recurring costs incurred for professional and legal fees and certain transition and integration-related costs, related to recent acquisitions.

⁽⁶⁾       35% represents the Company's estimated long-term, cross-jurisdictional effective cash tax rate.

⁽¹⁾      Amounts exclude 49% of the expenses to be incurred by the Company's Mexico subsidiary as such amounts are allocable to the noncontrolling interest shareholders. 

⁽²⁾     35% represents the Company's estimated long-term, cross-jurisdictional effective cash tax rate.

Cardtronics and Allpoint are registered trademarks of Cardtronics, Inc.

All other trademarks are the property of their respective owners.

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