Global Cash Access Holdings announced financial results for the first quarter ended March 31, 2012.
Fiscal First Quarter 2012 Highlights
Operating income increased 69% quarter-over-quarter to $15.7 million
EBITDA increased 51% quarter-over-quarter to $19.8 million
Net income per share – diluted increased 267% quarter-over-quarter to $0.11
Cash EPS increased 133% quarter-over-quarter to $0.21
“We are very pleased to announce today the strong start to the year with positive quarter-over-quarter results in our base business. With the stabilization of our base business and the portfolio of contracts we acquired through the MCA acquisition, GCA is well positioned for 2012,” said Scott Betts, President and CEO of Global Cash Access.
Fiscal First Quarter 2012 Results
Revenues were $151.1 million for the first quarter 2012, as compared to revenues of $134.4 million for the prior year’s first quarter. First quarter 2012 revenues were impacted by the Company’s purchase of substantially all of the assets of MCA Processing LLC (“MCA”) in November 2011. Operating income was $15.7 million, an increase of 69%, as compared to $9.3 million for the prior year’s first quarter. Earnings before interest, taxes, depreciation and amortization (“EBITDA”) (see Non-GAAP Financial Information below) were $19.8 million, an increase of 51%, as compared to $13.1 million in the prior year’s first quarter. The increase in EBITDA was primarily a result of both the October 1, 2011 enactment of the Durbin Amendment and its impact on the interchange rates paid by the Company on its debit card transactions, as well as the MCA asset purchase. Adjusted earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”) (see Non-GAAP Financial Information below) were $20.6 million, an increase of 46%, as compared to $14.1 million in the prior year’s first quarter.
Income before income tax provision was $11.2 million, an increase of 249%, as compared to $3.2 million in the prior year’s first quarter. Diluted earnings per share from continuing operations were $0.11 in the first quarter of 2012 (on 66.2 million diluted shares), as compared to $0.03 in the first quarter of 2011 (on 64.2 million diluted shares). Cash EPS (see Non-GAAP Financial Information below) was $0.21 in the first quarter of 2012, a 133% increase from the $0.09 reported in the prior year’s first quarter.
The Company reaffirms its estimates that for the fiscal year ending December 31, 2012, Cash EPS will be between approximately $0.76 and $0.82 and Adjusted EBITDA will be between approximately $73.0 million and $77.0 million.
The foregoing estimations reflect the following assumptions:
2012 estimated outlook assumes a modest improvement in the gaming industry in 2012;
Cash outlays for capital expenditures of between approximately $6.0 million and $8.0 million;
Fully diluted shares outstanding for the full year of approximately 66.0 million; and
Interest expense is based upon an increase in the 3-month LIBOR curve from 0.55% in 2011 to 0.70% in 2012.
Investor Conference Call and Webcast
The Company will host an investor conference call to discuss its first quarter 2012 results today at 5:00 p.m. ET. The conference call can be accessed live over the phone by dialing (877) 941-1428 or for international callers by dialing (480) 629-9665. A replay will be available at 8:00 p.m. ET and can be accessed by dialing (877) 870-5176 or (858) 384-5517 for international callers; the PIN is 4535777. The replay will be available until May 15, 2012. The call will be webcast live from the Company’s website at www.gcainc.com under the Investor Relations section.
Non-GAAP Financial Information
In order to enhance investor understanding of the underlying trends in our business and to provide for better comparability between periods in different years, the Company is providing EBITDA, Adjusted EBITDA, Cash Earnings and Cash EPS on a supplemental basis. Reconciliations between GAAP measures and Non-GAAP measures and between actual results and adjusted results are provided at the end of this press release. EBITDA, Adjusted EBITDA, Cash Earnings and Cash EPS are not measures of financial performance under United States Generally Accepted Accounting Principles (“GAAP”). Accordingly, they should not be considered a substitute for net income, operating income, basic or diluted earnings per share or cash flow data prepared in accordance with GAAP.
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. All statements included in this press release, other than statements that are purely historical, are forward-looking statements. Words such as “going forward,” “believes,” “intends,” “expects,” “forecasts,” “anticipate,” “plan,” “seek,” “estimate” and similar expressions also identify forward-looking statements. Forward-looking statements in this press release include, without limitation: (a) our belief we are well positioned for 2012; (b) our estimates of 2012 Cash EPS and Adjusted EBITDA and the assumptions upon which they are based; (c) our assumption that there will be a modest improvement in the gaming industry for 2012; (d) our assumption for 2012 that cash outlays for capital expenditures will be between approximately $6.0 million and $8.0 million; (e) our assumption for 2012 that there will be approximately 66.0 million diluted shares outstanding; (f) our assumption that the 3-month LIBOR will be 0.70% in 2012; and (g) our belief that EBITDA, Adjusted EBITDA and Cash EPS are widely-referenced financial measures in the financial markets and our belief that references to the foregoing are helpful to investors.
About Global Cash Access Holdings, Inc.
Las Vegas-based Global Cash Access, Inc. (“GCA”), a wholly owned subsidiary of Global Cash Access Holdings, Inc., is a leading provider of cash access products and related services to over 1,000 casinos and other gaming properties in the United States, Europe, Canada, the Caribbean, Central America and Asia. GCA’s products and services provide gaming patrons access to cash through a variety of methods, including ATM cash withdrawals, point-of-sale debit card transactions, credit card transactions, check verification and warranty services, and Western Union money transfers. Through Western Money Systems, a wholly owned subsidiary, GCA is a leading manufacturer and distributor of cash handling devices and related software. GCA also provides products and services that improve credit decision-making, automate cashier operations and enhance patron marketing activities for gaming establishments. With its proprietary database of gaming patron credit history and transaction data on millions of gaming patrons worldwide, GCA is recognized for successfully developing and deploying technological innovations that increase client profitability, operational efficiency and customer loyalty. More information is available at GCA’s website at www.gcainc.com.