SOURCE: DirectCash Payments Inc.

DirectCash Payments Inc.

February 24, 2016 17:30 ET

DirectCash Payments Inc. Announces Operational Highlights and Conference Call for the Year Ended December 31, 2015

CALGARY, AB--(Marketwired - February 24, 2016) -  DirectCash Payments Inc. ("DCPayments" or the "Company") (TSX: DCI) today announced select operational highlights, results and conference call details for the year ended December 31, 2015.

Operational Highlights:

  • Growth in transaction volumes in all business segments for the three months and year ended December 31, 2015 compared to the prior year periods
    • Increase in ATM transactions of 7%
    • Increase in Other Services Transactions of 4% and 3% respectively
  • Increase in the number of active ATMs as at December 31, 2015 by 2% to 21,454 as compared to the prior year
  • Acquisition of $3.5 million of ATM assets, including processing contracts for approximately 195 ATM locations in Canada
  • Re-purchased and cancelled 55,000 common shares throughout the 2014 year under the Company's current Normal Course Issuer Bid at an average price of $12.04 per common share
  • Refinanced the Company's credit facility to increase the Australian dollar sublimit, improve cash flow management and create a natural hedge between the Australian and Canadian currencies 
  • Increased Canadian vault cash rental agreement limit from $100 million to $150 million, improving operational flexibility
  • Reached agreement to settle all class action lawsuits filed against the company
  • Successfully implemented price increases and Dynamic Currency Conversion across global business
  • Acquired A$1.9 million of ATM assets, including processing contracts for approximately 250 ATM locations in Australia
  • Executed a long-term renewal of the Company's service and marketing agreements with DirectCash Bank
  • Extended agreement to acquire DirectCash Bank to August 15, 2016 to accommodate ongoing Office of the Superintendent of Financial Institutions review

Management's Commentary
"Our business continues to provide consistent cash flow and prospects for growth. We are focused on executing our plans for growth and continued diversification in our global financial transaction processing business to drive increased shareholder value," said Jeffrey Smith, DCPayments' President and Chief Executive Officer. 

DCPayments will pursue growth through additional accretive acquisitions at reasonable multiples as opportunities arise. DCPayments' stable and contracted revenue stream in our various geographic markets will continue to provide consistent cash dividends to DCPayments' Shareholders.

 
Summary Operating Results
  Three months ended Year ended
  December 31 December 31
  2015 2014 2015 2014
Summary operating results        
Number of machines        
Active ATM terminals(1) 21,454 21,103 21,454 21,103
  Americas 8,131 8,002 8,131 8,002
  Australasia 7,609 7,539 7,609 7,539
  Europe 5,714 5,562 5,714 5,562
         
ATM transactions, thousands 33,905 31,796 132,531 123,634
Average Monthly ATM Transactions per terminal 527 502 515 488
         
Other Services transactions, thousands 89,746 86,034 347,199 335,909
1 DCPayments has included statistics only for sites that recorded a transaction in the last calendar month of the period indicated
 

In the Americas, the number of active ATMs increased by 129 as compared to the prior year period. The increase was driven by new terminals installed as a result of the partnership between the Bank of Montreal ("BMO") and DCPayments to deploy BMO branded ATMs to Shell Canada Products locations across Canada exclusively, offset by the removal of approximately 224 ATMs from Mac's Convenience Stores ("Mac's") in Canada due to contract expiration and approximately 124 ATMs from Target stores in Canada that closed. The Company has retained the Mac's business in the Other Services business segment, where it will process the transactions of an additional estimated 830 ATMs in select Mac's, Couche-Tard and Circle K locations across Canada through its operation of The EXCHANGE® Network, which was part of the credit union and other financial institution processing and outsourcing services business acquired from Threshold Financial Technologies Inc. in 2013.

On December 30, 2015 the Company acquired the assets of a private company centred in Surrey, British Columbia for $3.5 million, subject to customary closing adjustments. As part of this acquisition, DCPayments acquired the processing contracts and residual contract rights for approximately 195 ATM locations in Canada, including approximately 40 seasonal and event locations. The transactions for the acquired ATMs were processed on DCPayments transaction processing platform under agreement with the Vendor prior to the time of acquisition and therefore had no impact on the number of active ATMs reported by the Company.

In Australasia, the number of active ATMs increased by 70 as at December 31, 2015 compared to the prior year period. This increase is primarily attributable to the previously announced acquisitions of OneCash Limited and DSM Connect Pty Ltd. (collectively "OneCash") on July 23, 2015.

In Europe, the number of active ATMs increased by 152 year over year primarily due to the Morrison's stores ATMs purchased from HSBC Bank Plc in the United Kingdom in March, 2015.

ATM transactions increased by 7% during the three months and year ended December 31, 2015 as compared to the prior year period.

Other Services transactions increased by 4% and 3% respectively for the three months and year ended December 31, 2015 as compared to the prior year period. The increase is primarily attributable to growth in volume for credit unions and other financial institutions, partially offset by declines in prepaid volume associated with business activity from Cash Store Financial Services Inc.

Conference Call
DCPayments' audited consolidated financial results for the year ended December 31, 2015 will be released to the market on Tuesday, March 22, 2016 after market close. A conference call will be held on Wednesday, March 23, 2016 at 10:00 a.m. Mountain Standard Time (MST) to review 2015 full year results. Jeffrey J. Smith, President & CEO, Patrick W. Moriarty, Chief Financial Officer, and Amanda J. Gallacher, Vice President, Corporate Strategy & Acquisitions, will host the call. The financial results, and an accompanying presentation, will be available on the Company website at www.directcash.net prior to the conference call.

DCPayments invites participants to listen to the webcast of the conference call by entering: http://www.gowebcasting.com/7273 in your web browser.

To participate in the Q&A session, please call the conference operator by dialing toll-free 1-800-355-4959 or locally 1-416-340-8527. A replay of the conference call will be available until Wednesday, March 30, 2016 by dialing toll-free 1-800-408-3053 or locally 1-905-694-9451 and entering passcode 5175557.

Forward Looking Information:
This press release offers our assessment of DCPayments' future plans and operations and contains "forward-looking information" relating to future events as defined under applicable Canadian securities legislation.

The forward-looking information is expressly qualified by this cautionary statement. Certain statements that contain words such as "could", "may", "believe", "should", "expect", "will", "intends", "plan", "anticipates", "potential", "estimates", "continues" or similar words relating to matters that are not historical facts constitute "forward-looking information" within the meaning of applicable Canadian securities legislation. 

Specifically, forward-looking information and statements contained in this press release include statements related to DCPayments' projected growth in business and operations in our various business segments in the Americas, Australasia and Europe, intention to complete quality accretive acquisitions at reasonable multiples on a go forward basis as opportunities arise, ability to provide consistent cash dividends, ability to drive growth and increase our margins, expansion of DCPayments' merchant base through new and innovative products and services, ability to continue to acquire long-term recurring revenue and services contracts and negotiate renewals thereof in advance of their expiry, ability to maintain current customer relationships, ability to add product offerings in the markets we operate in, ability to diversify both domestically and internationally and the possibility for increased capital expenditures related to technology and infrastructure or attributable to mandated regulatory security upgrade changes and the sufficiency of funds generated from operations to fund these expenditures.

Readers are cautioned that our expectations, estimates, projections and assumptions used in the preparation of such forward-looking information and statements, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking information. The Company's actual results or performance could differ materially from those expressed in, or implied by, this forward-looking information. DCPayments can give no assurance that any of the events anticipated will transpire or occur or, if any of them do, what benefits or costs we will derive from them. Forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond DCPayments' ability to control, including but not limited to general economic conditions, interest rates, foreign currency rates, consumer spending, borrowing trends and regulatory changes to name a few. Additional risks and uncertainties are described in DCPayments' Annual Information Form for the year ended December 31, 2014 which is available at www.SEDAR.com.

With respect to forward-looking statements and information contained within this press release, expectations are based on our current strategic plan and management forecasts, historical financial performance and operational data, and our existing contract schedule.

The assumptions and estimates relating to the forward-looking information referred to above are updated quarterly and except as required by law, we do not undertake to update any other forward-looking information.

Additional information about DCPayments is available on SEDAR (www.sedar.com) or DCPayments' website at www.directcash.net.

Contact Information

  • For further information please contact:

    Amanda J. Gallacher
    Vice President, Corporate Strategy & Acquisitions
    Direct Telephone: (403) 387-2158
    e-mail: investorrelations@directcash.net

    or

    Patrick W. Moriarty
    Chief Financial Officer
    Direct Telephone: (905) 461-2285
    e-mail: pmoriarty@directcash.net