VENDTEK SYSTEMS ANNOUNCES SECOND QUARTER FISCAL 2012 FINANCIAL RESULTS
VANCOUVER – June 29, 2012 - VendTek Systems Inc. (VSI - TSX Venture) (the "Company"), a developer and licensor of software for the global prepaid and financial services markets, today reported its financial results for the second quarter ended April 30, 2012.
Selected Second Quarter Operational Highlights
- Signed an agreement with Level Up! Games in Brazil;
- Achieved an 18% expansion of the Now Prepay Network in Brazil to over 2,000 locations up from approximately 1,700 at the end of the first quarter;
- Increased software and related services revenue 8.9% to $436,000 from the prior comparable period.
Selected Financial Information for the Three Months ended April 30, 2012
- Revenues for the three months ended April 30, 2012 decreased $2.8 million to $23.8 million from $26.6 million for the corresponding period in 2011;
- Gross margin increased to 5.7% for the three months ended April 30, 2012, from 5.0% for the corresponding period in 2011;
- Adjusted EBITDA1 improved to a loss of $625,000 for the second quarter of fiscal 2012 compared to a loss of $1.1 million for the second quarter of fiscal 2011;
- Net loss for the second quarter of fiscal 2012 was $890,043, compared to a net loss of $1.4 million for the second quarter of fiscal 2011;
- Cash provided by operations was $884,000 for the second quarter of fiscal 2012, compared to ($1.4 million) in the corresponding period in 2011.
"We have seen steady growth in our Brazilian network through the partnerships and client base we are developing," said Doug Buchanan, President and Chief Executive Officer of VendTek. "Partnerships like Level Up! Games afford us an opportunity to provide value added services to their customer base. This partnership also allows us to rapidly expand into several regions of Brazil that are under served by existing distribution methods. Accordingly, during the quarter our Brazilian sales and marketing costs increased $336,000 compared to the prior year's period. While we are excited about these and other such growth opportunities, we remain mindful of the investment required to bring this business to scale. In our North American operations, which include Canada and the U.S., we have taken steps during the quarter to reduce certain selling and administrative costs, added Mr. Buchanan."
"The Company's second quarter yielded some important positive results", commented Irwin Studen, Interim Chief Financial Officer of VendTek. "While revenue declined as expected due to the more competitive market for prepaid services in North America, the combination of improved gross margin and positive operating cash flow suggests the Company's earlier business restructuring initiatives are beginning to yield their intended results", added Mr. Studen.
VendTek's MD&A and complete financial statements and notes are available at www.sedar.com and the Company's website www.vendteksystems.com.
For more information or to receive the complete statements please contact Samantha White at 604-805-4653 or 1-800-806-4958 or investment@vendteksystems.com.
Conference Call
VendTek management will host a conference call on Tuesday July 3, 2012 at 4:00 PM EDT (1:00 PM PDT) to discuss its financial results and operational highlights for the second quarter of fiscal 2012.
To access the conference call by telephone, dial 1-647-427-7451 or 1-888-231-8191 and reference the company name, VendTek Systems Inc., or the conference code 96520923.
A live audio webcast of the conference call will be available at http://www.newswire.ca/en/webcast/detail/1000589/1080757 Please connect at least 15 minutes prior to the conference call to ensure adequate time for any software download that may be required to join the webcast.
1Management defines Adjusted EBITDA as net income adjusted for financing, taxes, depreciation, amortization expenses, foreign exchange differences and stock based compensation expense. Please see the Management Discussion and Analysis for more details.
