USA Technologies (USTA) Offers Preliminary Q2 Results
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USA Technologies, Inc. (NASDAQ: USAT), today announced preliminary results for the Company’s fiscal 2012 second quarter, which ends on December 31, 2011.
The Company expects revenues for the second quarter to be in the range of $6.8 to $7.0 million, which would represent an increase in the range of 13% - 17% compared to second quarter fiscal 2011 revenues of $6 million. The Company anticipates processing 25 million transactions during the second quarter, representing volume of $41 million in the second quarter, both of which would represent growth of greater than 50% from the fiscal year 2011 second quarter.
During the second quarter, the Company experienced unusual items that temporarily influenced financial results. First, the Company is expected to take charges which will reflect costs associated with the investigation and the terms of the resignation of, the Company’s former Chairman and CEO. Second, the Company also expects gross profit dollars and the gross margin percentage in the second quarter to decrease relative to the first quarter, primarily due to the increase in debit processing costs incurred in the quarter as a result of the Durbin Amendment.
The impact on margins caused by the Durbin Amendment is specific to the second quarter as the new Agreement with Visa that went into effect on October 14, 2011 essentially restored debit interchange rates to pre-October 1 levels on approximately 85% of the company’s processing volume. In addition, the termination of the acceptance of MasterCard debit transactions effective on November 14, 2011, has also helped restore margins to rates that are consistent with historical Company results.
The Company expects revenues for the second quarter to be in the range of $6.8 to $7.0 million, which would represent an increase in the range of 13% - 17% compared to second quarter fiscal 2011 revenues of $6 million. The Company anticipates processing 25 million transactions during the second quarter, representing volume of $41 million in the second quarter, both of which would represent growth of greater than 50% from the fiscal year 2011 second quarter.
During the second quarter, the Company experienced unusual items that temporarily influenced financial results. First, the Company is expected to take charges which will reflect costs associated with the investigation and the terms of the resignation of, the Company’s former Chairman and CEO. Second, the Company also expects gross profit dollars and the gross margin percentage in the second quarter to decrease relative to the first quarter, primarily due to the increase in debit processing costs incurred in the quarter as a result of the Durbin Amendment.
The impact on margins caused by the Durbin Amendment is specific to the second quarter as the new Agreement with Visa that went into effect on October 14, 2011 essentially restored debit interchange rates to pre-October 1 levels on approximately 85% of the company’s processing volume. In addition, the termination of the acceptance of MasterCard debit transactions effective on November 14, 2011, has also helped restore margins to rates that are consistent with historical Company results.
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