Cash Systems (MM) (NASDAQ:CKNN)
Historical Stock Chart
From Jul 2019 to Jul 2024
![Click Here for more Cash Systems (MM) Charts. Click Here for more Cash Systems (MM) Charts.](/p.php?pid=staticchart&s=N%5ECKNN&p=8&t=15)
Cash Systems, Inc. (NASDAQ: CKNN), a provider of cash access solutions
for the gaming industry, today announced first quarter 2008 financial
results.
First quarter 2008 highlights include:
A multi-year contract extension with Choctaw Nation of Oklahoma for
its Choctaw Casinos and the addition of another Choctaw Casino
location where Cash Systems will provide its casinopc
for cash advance services, ecash checking and full
service booth operation.
A Letter of Intent to provide Cash Systems powercash
product to American Gaming Group LLC's first casino project.
powercash compatibility with the Bally Technologies,
Inc.'s (NYSE: BYI) new iVIEW(TM) Display Manager (DM)(TM).
A new multi-year contract to provide its full line of cash access
services including all-in-1atm services, casinopc
for cash advance services, and ecash checking at Gold
River Casino.
A new multi-year contract with The Wildwood Casino where Cash Systems
will provide its full line of cash access services including
all-in-1atm, casinopc for cash advance services,
and ecash checking.
Subsequent to the end of the first quarter of 2008 the Company also
announced:
A new multi-year contract with Fantasy Springs Resort Casino, to
provide casinopc for cash advance services, all-in-1atm
services, ecash checking services for check guarantee
and full service booth operation, in addition to powercash.
First Quarter Financial Results
Revenue for the first quarter was $27.1 million, an increase of 8%,
compared to $25.2 million in the first quarter of 2007. The Company
reported a loss from operations of ($864,031) in the first quarter of
2008 compared to loss from operations of ($268,021) in the prior year
period. Net loss was ($4.6 million), or ($0.25) per diluted share,
compared to net loss of ($1.4 million) or ($0.08) per diluted share, in
the first quarter of 2007.
Michael Rumbolz, President and Chief Executive Officer of Cash Systems,
Inc. stated, “We continue to see progress and
positive customer feedback from our product offerings and we continue to
make progress on powercash. We remain focused on providing
outstanding service to our clients.”
Second Amended and Restated Notes and Warrants
On March 14, 2008, the Company entered into a Second Amendment and
Exchange Agreement with respect to its outstanding senior secured
convertible notes. The Second Amended and Restated Notes differ from the
First Amended and Restated Notes in certain material respects,
including, without limitation, (i) the aggregate principal amount was
increased from $22.0 million to $24.2 million, (ii) the conversion price
was reduced from $8.00 per share to $2.51 per share, (iii) the aggregate
amount that the note holders may require the Company to redeem, and the
aggregate amount that the Company may elect to redeem, on October 10,
2008 was increased from $8 million to $12.1 million, (iv) and the
financial covenants based on Consolidated Total Debt to EBITDA were
eliminated and the financial covenants based on Consolidated Revenue and
Consolidated EBITDA were modified to apply starting with the quarter
ending March 31, 2009. The Second Amended and Restated Warrants to
purchase common stock differ from the First Amended and Restated
Warrants in certain material respects, including, without limitation,
the exercise price was reduced from $7.38 per share to $2.49 per share.
As a result of the note holder’s failure to
reduce the conversion price of the Second Amended and Restated Notes and
the exercise price of the Second Amended and Restated Warrants to 120%
of the arithmetic average of the weighted average price of the Company’s
common stock for each day during the period commencing on March 18, 2008
and ending on April 15, 2008, the conversion price of the Second Amended
and Restated Notes continues to be $2.51 per share and the exercise
price of the Second Amended and Restated Warrants continues to be $2.49
per share.
Strategic Alternatives
The Company previously announced that its Board of Directors decided to
explore strategic alternatives to maximize shareholder value. This
process is ongoing. There can be no assurances that this process will
result in any specific transaction. The Company does not intend to
disclose developments regarding its exploration of strategic
alternatives unless and until the Board of Directors approve a
definitive transaction.
Earnings Conference Call
The Company will conduct a conference call to discuss its first quarter
2008 financial results on Monday, May 12, 2008 at 5:00 p.m. ET. A
webcast of the call will be available by visiting the investor relations
section of the company's website at http://www.cashsystemsinc.com/ir.
The call can also be accessed live over the phone by dialing
888-208-1427 or for international callers by dialing 913-312-1398. A
replay of the call will be available one hour after the call and can be
accessed by dialing 888-203-1112 or 719-457-0820 for international
callers; the pin number is 6643217. The replay will be available from
May 12, 2008 through May 19, 2008.
About Cash Systems, Inc.
Cash Systems, Inc., located in Las Vegas, with additional offices in San
Diego and Minneapolis, is a provider of cash-access and related services
to the retail and gaming industries. Cash Systems' products include its
proprietary cash advance systems, ATMs and check cashing solutions.
Please visit http://www.cashsystemsinc.com
for more information.
This press release may contain forward-looking statements, including the
Company's beliefs about its business prospects and future results of
operations. These statements involve risks and uncertainties. Among the
important additional factors that could cause actual results to differ
materially from those forward-looking statements are risks associated
with the overall economic environment, the successful execution of the
Company's plan of operation, changes in the Company's anticipated
earnings, continuation of current contracts, gaming and other applicable
regulations, and other factors detailed in the Company's filings with
the Securities and Exchange Commission, including its most recent Forms
10K and 10Q. In addition, the factors underlying Company forecasts are
dynamic and subject to change and therefore those forecasts speak only
as of the date they are given. The Company does not undertake to update
any forecasts that it may make available to the investing public.
CASH SYSTEMS, INC.
CONSOLIDATED BALANCE SHEETS
March 31,
December 31,
2008
2007
(Unaudited)
(Audited)
ASSETS
CURRENT ASSETS
Cash
$
13,408,127
$
16,617,643
Restricted cash
630,906
625,059
Current portion of prepaid commissions
428,908
394,096
Current portion of loans receivable
1,441,815
331,005
Settlements due from credit card processors
5,630,035
14,779,241
Settlements due from ATM processors
12,425,412
12,094,482
Other current assets
7,930,474
7,409,494
Total Current Assets
41,895,677
52,251,020
PROPERTY AND EQUIPMENT, NET
7,098,945
7,087,436
OTHER ASSETS
Goodwill
4,077,700
4,077,700
Intangible assets, net
4,024,359
4,289,024
Long-term prepaid commissions, net of current portion
456,847
385,876
Long-term loans receivable, net of current portion
191,855
265,504
Restricted cash
396,158
211,317
Other
93,655
308,061
Total Other Assets
9,240,574
9,537,482
TOTAL ASSETS
$
58,235,196
$
68,875,938
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Checks issued in excess of cash in bank
$
8,031,664
$
15,205,390
Short-term debt, net
12,100,000
12,100,000
Accounts payable - trade
1,922,469
1,754,781
Credit card cash advance fees payable
1,696,789
1,667,462
ATM commissions payable
2,556,061
2,028,940
Credit card chargebacks payable
620,452
326,563
Check cashing commissions payable
235,117
223,785
Deferred Revenues
459,526
-
Other accrued expenses
20,398,760
23,395,403
Total Current Liabilities
48,020,838
56,702,324
LONG-TERM LIABILITIES
Long-term debt, net
12,100,000
9,900,000
Total Liabilities
60,120,838
66,602,324
STOCKHOLDERS' EQUITY
Common stock, par value of $0.001, 50,000,000 shares authorized,18,776,913
and 18,776,913 shares issued, 18,481,580 and 18,446,163shares
outstanding
18,483
18,447
Additional paid-in capital
30,022,124
29,535,292
Accumulated deficit
(31,926,249
)
(27,280,125
)
Total Stockholders' Equity
(1,885,642
)
2,273,614
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
$
58,235,196
$
68,875,938
CASH SYSTEMS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended
March 31,
2008
2007
Commissions on credit card cash advances,ATMs and check
cashing services
$
27,066,228
$
25,156,145
Operating expenses
Commissions
15,400,617
14,196,324
Processing costs
4,325,779
4,305,903
Check cashing costs
2,073,227
923,502
Armored carrier services
302,253
277,360
Payroll, benefits and related taxes
3,189,093
2,822,429
Professional fees
530,371
398,885
Other general and administrative expenses
1,261,678
1,654,609
Depreciation and amortization
847,241
845,154
Total operating expenses
27,930,259
25,424,166
Loss from operations
(864,031
)
(268,021
)
Other income (expense)
Interest expense
(1,207,422
)
(1,169,180
)
Loss on extinguishment of debt
(2,615,480
)
-
Interest and other income
40,809
11,246
Total other income (expense)
(3,782,093
)
(1,157,934
)
Loss before income taxes
(4,646,124
)
(1,425,955
)
Provision for income taxes
-
-
Net Loss
$
(4,646,124
)
$
(1,425,955
)
Net Loss per common share:
Basic
$
(0.25
)
$
(0.08
)
Diluted
$
(0.25
)
$
(0.08
)
Weighted average common shares outstanding:
Basic
18,454,603
18,055,350
Diluted
18,454,603
18,055,350