MALVERN, PA — USA Technologies, Inc. (OTC: USAT), a cashless payments and software services company that provides end-to-end technology solutions for the self-service retail market, reported results for the first quarter fiscal year 2020 ended September 30, 2019.
“We are pleased to report record quarterly revenue led by an expanding customer base and strong growth in connections,” said Don Layden, USA Technologies’ Interim Chief Executive Officer. “The entire management team is focused on strengthening the business by reducing the company’s cost structure to improve profitability while enhancing our customer service and we are working diligently to regain our Nasdaq listing. We believe that the company remains well positioned to capitalize on the ongoing shift and increasing demand for electronic payment transactions in the unattended retail market.”
First Quarter Fiscal 2020 Financial Highlights:
- Revenue of $42.1 million, increased 25.7% year-over-year
- License and transaction fee revenue of $33.8 million, increased 16.8% year-over-year
- Equipment revenue of $8.3 million, increased 82.7% year-over-year
- Net new connections of 46,000 bring total connections to 1,215,000
- Gross margins of 23.9% decreased from 30.2% in the prior year period
- License and transaction gross margin of 36.0%, flat compared to the prior year period
- Equipment gross margin of (25.7)% decreased from (7.0)% in the prior year period
- Operating loss of $(12.8) million compared to operating loss of $(5.9) million in the prior year period
- Net loss of $(12.9) million, or $(0.22) per share compared to net loss of $(6.3) million, or $(0.11) per share in the prior year period
- Non-GAAP net loss of $(8.0) million, or $(0.13) per share compared to non-GAAP net income of $0.3 million, or $0.01 per share in the prior year period
- Adjusted EBITDA of $(7.5) million compared to $(2.1) million in the prior year period
- Ended the quarter with $25.5 million in cash and cash equivalents
“We are pleased to deliver strong revenue growth during the first fiscal quarter with over 80% of our revenue now from recurring license and transaction fees,” said Glen Goold, USA Technologies’ Interim Chief Financial Officer. “In order to further strengthen our balance sheet, we plan to sell a portfolio of lease receivables and expect this transaction to close in late Q2 or early Q3 of our FY 2020.”
Fiscal Year 2020 Outlook:
For full fiscal year 2020, the company continues to expect revenue to be between $165 million to $175 million and expects to add 170,000 to 190,000 net new connections to its service. Adjusted EBITDA was lower than expected in the first quarter of fiscal year 2020 primarily because professional service fees were higher than expected for costs related to the company’s restatement audit. Despite the first quarter loss, the company continues to believe that it will produce between $10 million and $11 million in Adjusted EBITDA over the full 2020 fiscal year.
Source: USA Technologies Inc, 100 Deerfield Ln Ste 300, Malvern PA 19355
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