Pennsylvania
|
001-33365
|
23‑2679963
|
(State or other jurisdiction of incorporation or organization)
|
(Commission File Number)
|
(I.R.S. Employer Identification No.)
|
☐ |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
|
☐ |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
|
☐ |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
|
☐ |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
|
Item 2.02. |
Results of Operations and Financial Condition
|
Item 9.01. |
Financial Statements and Exhibits
|
Exhibit 99.1
|
Press Release of the Company dated February 8, 2017
|
USA TECHNOLOGIES, INC.
|
||
Dated: February 10, 2017
|
By:
|
/s/ Stephen P. Herbert
|
Stephen P. Herbert,
|
||
Chairman and Chief Executive Officer
|
Exhibit No.
|
Description of Exhibit
|
Press Release of the Company dated February 8, 2017
|
☐ |
Total quarterly revenue of $21.8 million, a year-over-year increase of 18%
|
☐ |
469,000 connections to ePort service, representing a year-over-year increase of 27%
|
☐ |
Added 500 customers to achieve record 11,900 total customers compared to 10,625 as of a year ago, a year-over-year increase of 12%
|
☐ |
Quarterly record license and transaction fee revenue of $16.6 million, a year-over-year increase of 22%
|
☐ |
Ended the quarter with $18.0 million in cash
|
☐ |
Quarterly GAAP net income of $233,000 resulting in earnings of $0.01 per share
|
☐ |
Quarterly Non-GAAP net income of $241,000
|
☐ |
Quarterly Adjusted EBITDA of $1.7 million
|
As of and for the three months ended
December 31,
|
||||||||||||||||
(Connections and $'s in thousands, transactions in millions, eps is not rounded)
|
2016
|
2015
|
$ Change
|
% Change
|
||||||||||||
Revenues:
|
||||||||||||||||
License and transaction fees
|
$
|
16,639
|
$
|
13,674
|
$
|
2,965
|
22
|
%
|
||||||||
Equipment Sales
|
5,117
|
4,829
|
288
|
6
|
%
|
|||||||||||
Total revenues
|
$
|
21,756
|
$
|
18,503
|
$
|
3,253
|
18
|
%
|
||||||||
License and transaction fee margin
|
31.6
|
%
|
33.7
|
%
|
-2.1
|
%
|
-6
|
%
|
||||||||
Equipment sales gross margin
|
21.2
|
%
|
18.1
|
%
|
3.1
|
%
|
17
|
%
|
||||||||
Overall Gross Margin
|
29.1
|
%
|
29.6
|
%
|
-0.5
|
%
|
-2
|
%
|
||||||||
Operating income
|
$
|
234
|
$
|
594
|
$
|
(360
|
)
|
-61
|
%
|
|||||||
Net income/(loss)
|
$
|
233
|
$
|
(874
|
)
|
$
|
1,107
|
127
|
%
|
|||||||
Net earnings (loss) per common shares - basic
|
$
|
0.01
|
$
|
(0.02
|
)
|
$
|
0.03
|
150
|
%
|
|||||||
Net earnings (loss) per common shares - diluted
|
$
|
0.01
|
$
|
(0.02
|
)
|
$
|
0.03
|
150
|
%
|
|||||||
Net cash provided by operating activities
|
$
|
1,122
|
$
|
507
|
$
|
615
|
121
|
%
|
||||||||
Net New Connections
|
21
|
20
|
1
|
5
|
%
|
|||||||||||
Total Connections (at period end)
|
469
|
369
|
100
|
27
|
%
|
|||||||||||
Total Number of Transactions (millions)
|
100
|
76
|
24
|
32
|
%
|
|||||||||||
Transaction Volume (millions)
|
$
|
192
|
$
|
138
|
$
|
54
|
39
|
%
|
||||||||
Adjusted EBITDA
|
$
|
1,738
|
$
|
2,260
|
$
|
(522
|
)
|
-23
|
%
|
|||||||
Non-GAAP net income
|
$
|
241
|
$
|
686
|
$
|
(445
|
)
|
-65
|
%
|
As of and for the six months ended
December 31,
|
||||||||||||||||
(Connections and $'s in thousands, transactions in millions, eps is not rounded)
|
2016
|
2015
|
$ Change
|
% Change
|
||||||||||||
Revenues:
|
||||||||||||||||
License and transaction fees
|
$
|
33,004
|
$
|
26,599
|
$
|
6,405
|
24
|
%
|
||||||||
Equipment Sales
|
10,340
|
8,504
|
1,836
|
22
|
%
|
|||||||||||
Total revenues
|
$
|
43,344
|
$
|
35,103
|
$
|
8,241
|
23
|
%
|
||||||||
License and transaction fee margin
|
31.4
|
%
|
33.2
|
%
|
-1.8
|
%
|
-5
|
%
|
||||||||
Equipment sales gross margin
|
20.6
|
%
|
20.0
|
%
|
0.6
|
%
|
3
|
%
|
||||||||
Overall Gross Margin
|
28.8
|
%
|
30.0
|
%
|
-1.2
|
%
|
-4
|
%
|
||||||||
Operating income/(loss)
|
$
|
(716
|
)
|
$
|
706
|
$
|
(1,422
|
)
|
-201
|
%
|
||||||
Net loss
|
$
|
(2,231
|
)
|
$
|
(514
|
)
|
$
|
(1,717
|
)
|
334
|
%
|
|||||
Net loss per common shares - basic
|
$
|
(0.07
|
)
|
$
|
(0.02
|
)
|
$
|
(0.05
|
)
|
250
|
%
|
|||||
Net loss per common shares - diluted
|
$
|
(0.07
|
)
|
$
|
(0.02
|
)
|
$
|
(0.05
|
)
|
250
|
%
|
|||||
Net cash provided by (used in) operating activities
|
$
|
(5,143
|
)
|
$
|
869
|
$
|
(6,012
|
)
|
-692
|
%
|
||||||
Net New Connections
|
40
|
36
|
4
|
11
|
%
|
|||||||||||
Total Connections (at period end)
|
469
|
369
|
100
|
27
|
%
|
|||||||||||
Total Number of Transactions (millions)
|
195
|
145
|
50
|
35
|
%
|
|||||||||||
Transaction Volume (millions)
|
$
|
375
|
$
|
264
|
$
|
111
|
42
|
%
|
||||||||
Adjusted EBITDA
|
$
|
2,435
|
$
|
4,011
|
$
|
(1,576
|
)
|
-39
|
%
|
|||||||
Non-GAAP net income (loss)
|
$
|
(714
|
)
|
$
|
747
|
$
|
(1,461
|
)
|
-196
|
%
|
A. |
Statements of Operations for the 3 Months and 6 Months Ended December 31, 2016 and 2015
|
B. |
Five Quarter Select Key Performance Indicators
|
C. |
Comparative
Balance Sheets as of December 31, 2016 and June 30, 2016
|
D. |
Five Quarter Statements of Operations and Adjusted EBITDA
|
E. |
Five Quarter and YTD Selling, General, & Administrative Expenses
|
F. |
Five Quarter Condensed Balance Sheets
|
G. |
Five Quarter Statements of Cash Flows
|
H. |
Five Quarter Reconciliation of Net Income/(Loss) to Non-GAAP Net Income (Loss) and Net Earnings/(Loss) Per Common Share – Basic and Diluted to Non-GAAP Net Earnings/(Loss) Per Common Share – Basic and Diluted
|
(A) |
Statement of Operations for the 3 Months and 6 Months Ended December 31, 2016 and 2015
|
For the three months ended December 31,
|
||||||||||||||||||||||||
($ in thousands, except shares and per share data)
|
2016
|
% of Sales
|
2015
|
% of Sales
|
Change
|
% Change
|
||||||||||||||||||
Revenues:
|
||||||||||||||||||||||||
License and transaction fees
|
$
|
16,639
|
76.5
|
%
|
$
|
13,674
|
73.9
|
%
|
$
|
2,965
|
21.7
|
%
|
||||||||||||
Equipment sales
|
5,117
|
23.5
|
%
|
4,829
|
26.1
|
%
|
288
|
6.0
|
%
|
|||||||||||||||
Total revenues
|
21,756
|
100.0
|
%
|
18,503
|
100.0
|
%
|
3,253
|
17.6
|
%
|
|||||||||||||||
|
||||||||||||||||||||||||
Costs of sales/revenues:
|
||||||||||||||||||||||||
Cost of services
|
11,389
|
68.4
|
%
|
9,067
|
66.3
|
%
|
2,322
|
25.6
|
%
|
|||||||||||||||
Cost of equipment
|
4,033
|
78.8
|
%
|
3,953
|
81.9
|
%
|
80
|
2.0
|
%
|
|||||||||||||||
Total costs of sales/revenues
|
15,422
|
70.9
|
%
|
13,020
|
70.4
|
%
|
2,402
|
18.4
|
%
|
|||||||||||||||
Gross profit
|
6,334
|
29.1
|
%
|
5,483
|
29.6
|
%
|
851
|
15.5
|
%
|
|||||||||||||||
|
||||||||||||||||||||||||
Operating expenses:
|
||||||||||||||||||||||||
Selling, general and administrative
|
5,793
|
26.6
|
%
|
4,762
|
25.7
|
%
|
1,031
|
21.7
|
%
|
|||||||||||||||
Depreciation and amortization
|
307
|
1.4
|
%
|
127
|
0.7
|
%
|
180
|
141.7
|
%
|
|||||||||||||||
Total operating expenses
|
6,100
|
28.0
|
%
|
4,889
|
26.4
|
%
|
1,211
|
24.8
|
%
|
|||||||||||||||
Operating income (loss)
|
234
|
1.1
|
%
|
594
|
3.2
|
%
|
(360
|
)
|
-60.6
|
%
|
||||||||||||||
|
||||||||||||||||||||||||
Other income (expense):
|
||||||||||||||||||||||||
Interest income
|
200
|
0.9
|
%
|
20
|
0.1
|
%
|
180
|
900.0
|
%
|
|||||||||||||||
Interest expense
|
(201
|
)
|
-0.9
|
%
|
(104
|
)
|
-0.6
|
%
|
(97
|
)
|
93.3
|
%
|
||||||||||||
Change in fair value of warrant liabilities
|
—
|
0.0
|
%
|
(1,230
|
)
|
-6.6
|
%
|
1,230
|
-100.0
|
%
|
||||||||||||||
Total other income (expense), net
|
(1
|
)
|
0.0
|
%
|
(1,314
|
)
|
-7.1
|
%
|
1,313
|
-99.9
|
%
|
|||||||||||||
Income (loss) before income taxes
|
233
|
1.1
|
%
|
(720
|
)
|
-3.9
|
%
|
953
|
132.4
|
%
|
||||||||||||||
Benefit (provision) for income taxes
|
—
|
0.0
|
%
|
(154
|
)
|
-0.8
|
%
|
154
|
-100.0
|
%
|
||||||||||||||
Net income (loss)
|
233
|
1.1
|
%
|
(874
|
)
|
-4.7
|
%
|
1,107
|
126.7
|
%
|
||||||||||||||
Cumulative preferred dividends
|
—
|
0.0
|
%
|
—
|
0.0
|
%
|
—
|
0.0
|
%
|
|||||||||||||||
Net income (loss) applicable to common shares
|
$
|
233
|
1.1
|
%
|
$
|
(874
|
)
|
-4.7
|
%
|
$
|
1,107
|
127.7
|
%
|
|||||||||||
Net earnings (loss) per common share - basic
|
$
|
0.01
|
$
|
(0.02
|
)
|
$
|
0.03
|
150
|
%
|
|||||||||||||||
Net earnings (loss) per common share - diluted
|
$
|
0.01
|
$
|
(0.02
|
)
|
$
|
0.03
|
150
|
%
|
|||||||||||||||
Basic weighted average number of common shares outstanding
|
40,308,934
|
35,909,933
|
4,399,001
|
12.3
|
%
|
|||||||||||||||||||
Diluted weighted average number of common shares outstanding
|
40,730,712
|
35,909,933
|
4,820,779
|
13.4
|
%
|
For the six months ended December 31,
|
||||||||||||||||||||||||
($ in thousands, except shares and per share data)
|
2016
|
% of Sales
|
2015
|
% of Sales
|
Change
|
% Change
|
||||||||||||||||||
Revenues:
|
||||||||||||||||||||||||
License and transaction fees
|
$ |
33,004
|
76.1
|
%
|
$
|
26,599
|
75.8
|
%
|
$
|
6,405
|
24.1
|
%
|
||||||||||||
Equipment sales
|
10,340
|
23.9
|
%
|
8,504
|
24.2
|
%
|
1,836
|
21.6
|
%
|
|||||||||||||||
Total revenues
|
43,344
|
100.0
|
%
|
35,103
|
100.0
|
%
|
8,241
|
23.5
|
%
|
|||||||||||||||
|
||||||||||||||||||||||||
Costs of sales/revenues:
|
||||||||||||||||||||||||
Cost of services
|
22,632
|
68.6
|
%
|
17,772
|
66.8
|
%
|
4,860
|
27.3
|
%
|
|||||||||||||||
Cost of equipment
|
8,211
|
79.4
|
%
|
6,801
|
80.0
|
%
|
1,410
|
20.7
|
%
|
|||||||||||||||
Total costs of sales/revenues
|
30,843
|
71.2
|
%
|
24,573
|
70.0
|
%
|
6,270
|
25.5
|
%
|
|||||||||||||||
Gross profit
|
12,501
|
28.8
|
%
|
10,530
|
30.0
|
%
|
1,971
|
18.7
|
%
|
|||||||||||||||
|
||||||||||||||||||||||||
Operating expenses:
|
||||||||||||||||||||||||
Selling, general and administrative
|
12,702
|
29.3
|
%
|
9,558
|
27.2
|
%
|
3,144
|
32.9
|
%
|
|||||||||||||||
Depreciation and amortization
|
515
|
1.2
|
%
|
266
|
0.8
|
%
|
249
|
93.6
|
%
|
|||||||||||||||
Total operating expenses
|
13,217
|
30.5
|
%
|
9,824
|
28.0
|
%
|
3,393
|
34.5
|
%
|
|||||||||||||||
Operating income (loss)
|
(716
|
)
|
-1.7
|
%
|
706
|
2.0
|
%
|
(1,422
|
)
|
-201.4
|
%
|
|||||||||||||
|
||||||||||||||||||||||||
Other income (expense):
|
||||||||||||||||||||||||
Interest income
|
273
|
0.6
|
%
|
71
|
0.2
|
%
|
202
|
284.5
|
%
|
|||||||||||||||
Interest expense
|
(413
|
)
|
-1.0
|
%
|
(223
|
)
|
-0.6
|
%
|
(190
|
)
|
85.2
|
%
|
||||||||||||
Change in fair value of warrant liabilities
|
(1,490
|
)
|
-3.4
|
%
|
(887
|
)
|
-2.5
|
%
|
(603
|
)
|
68.0
|
%
|
||||||||||||
Total other income (expense), net
|
(1,630
|
)
|
-3.8
|
%
|
(1,039
|
)
|
-3.0
|
%
|
(591
|
)
|
56.9
|
%
|
||||||||||||
Income (loss) before provision for income taxes
|
(2,346
|
)
|
-5.4
|
%
|
(333
|
)
|
-0.9
|
%
|
(2,013
|
)
|
604.5
|
%
|
||||||||||||
Benefit (provision) for income taxes
|
115
|
0.3
|
%
|
(181
|
)
|
-0.5
|
%
|
296
|
-163.5
|
%
|
||||||||||||||
Net income (loss)
|
(2,231
|
)
|
-5.1
|
%
|
(514
|
)
|
-1.5
|
%
|
(1,717
|
)
|
334.0
|
%
|
||||||||||||
Cumulative preferred dividends
|
(334
|
)
|
-0.8
|
%
|
(334
|
)
|
-1.0
|
%
|
—
|
0.0
|
%
|
|||||||||||||
Net income (loss) applicable to common shares
|
$
|
(2,565
|
)
|
-5.9
|
%
|
$
|
(848
|
)
|
-2.4
|
%
|
$
|
(1,717
|
)
|
202.5
|
%
|
|||||||||
Net earnings (loss) per common share - basic
|
$
|
(0.07
|
)
|
$
|
(0.02
|
)
|
$
|
(0.05
|
)
|
250.0
|
%
|
|||||||||||||
Net earnings (loss) per common share - diluted
|
$
|
(0.07
|
)
|
$
|
(0.02
|
)
|
$
|
(0.05
|
)
|
250.0
|
%
|
|||||||||||||
Basic weighted average number of common shares outstanding
|
39,398,469
|
35,879,164
|
3,519,305
|
9.8
|
%
|
|||||||||||||||||||
Diluted weighted average number of common shares outstanding
|
39,398,469
|
35,879,164
|
3,519,305
|
9.8
|
%
|
(B) |
Five Quarter Select Key Performance Indicators
|
As of and for the three months ended
|
||||||||||||||||||||
Dcember 31,
2016
|
September 30,
2016
|
June 30,
2016
|
March 31,
2016
|
December 31,
2015
|
||||||||||||||||
Connections:
|
||||||||||||||||||||
Gross New Connections
|
25,000
|
22,000
|
33,000
|
34,000
|
23,000
|
|||||||||||||||
% from Existing Customer Base
|
80
|
%
|
86
|
%
|
83
|
%
|
91
|
%
|
89
|
%
|
||||||||||
Net New Connections
|
21,000
|
19,000
|
28,000
|
32,000
|
20,000
|
|||||||||||||||
Total Connections
|
469,000
|
448,000
|
429,000
|
401,000
|
369,000
|
|||||||||||||||
Customers:
|
||||||||||||||||||||
New Customers Added
|
500
|
350
|
300
|
125
|
350
|
|||||||||||||||
Total Customers
|
11,900
|
11,400
|
11,050
|
10,750
|
10,625
|
|||||||||||||||
Volumes:
|
||||||||||||||||||||
Total Number of Transactions (millions)
|
100
|
95
|
89
|
82
|
76
|
|||||||||||||||
Transaction Volume (millions)
|
$
|
192
|
$
|
183
|
$
|
169
|
$
|
151
|
$
|
138
|
||||||||||
Financing Structure of Connections:
|
||||||||||||||||||||
JumpStart
|
6.8
|
%
|
7.7
|
%
|
6.5
|
%
|
7.4
|
%
|
10.1
|
%
|
||||||||||
QuickStart & All Others *
|
93.2
|
%
|
92.3
|
%
|
93.5
|
%
|
92.6
|
%
|
89.9
|
%
|
||||||||||
Total
|
100.0
|
%
|
100.0
|
%
|
100.0
|
%
|
100.0
|
%
|
100.0
|
%
|
* |
Includes credit sales with standard trade receivable terms
|
(C) |
Comparative Balance Sheets December 31, 2016 and June 30, 2016
|
($ in thousands)
|
December 31,
2016
|
June 30,
2016
|
Change
|
% Change
|
||||||||||||
Assets
|
||||||||||||||||
Current assets:
|
||||||||||||||||
Cash
|
$
|
18,034
|
$
|
19,272
|
$
|
(1,238
|
)
|
-6
|
%
|
|||||||
Accounts receivable, less allowance
|
6,796
|
4,899
|
1,897
|
39
|
%
|
|||||||||||
Finance receivables, less allowance for credit losses of $29 and $0, respectively
|
1,442
|
3,588
|
(2,146
|
)
|
-60
|
%
|
||||||||||
Inventory, net
|
4,786
|
2,031
|
2,755
|
136
|
%
|
|||||||||||
Prepaid expenses and other current assets
|
1,764
|
987
|
777
|
79
|
%
|
|||||||||||
Deferred income taxes
|
2,271
|
2,271
|
—
|
0
|
%
|
|||||||||||
Total current assets
|
35,093
|
33,048
|
2,045
|
6
|
%
|
|||||||||||
Finance receivables, less current portion
|
3,956
|
3,718
|
238
|
6
|
%
|
|||||||||||
Other assets
|
145
|
348
|
(203
|
)
|
-58
|
%
|
||||||||||
Property and equipment, net
|
9,433
|
9,765
|
(332
|
)
|
-3
|
%
|
||||||||||
Deferred income taxes
|
25,568
|
25,453
|
115
|
0
|
%
|
|||||||||||
Intangibles, net
|
711
|
798
|
(87
|
)
|
-11
|
%
|
||||||||||
Goodwill
|
11,492
|
11,703
|
(211
|
)
|
-2
|
%
|
||||||||||
Total assets
|
$
|
86,398
|
$
|
84,833
|
$
|
1,565
|
2
|
%
|
||||||||
Liabilities and shareholders' equity
|
||||||||||||||||
Current liabilities:
|
||||||||||||||||
Accounts payable
|
$
|
9,090
|
$
|
12,354
|
$
|
(3,264
|
)
|
-26
|
%
|
|||||||
Accrued expenses
|
2,912
|
3,458
|
(546
|
)
|
-16
|
%
|
||||||||||
Line of credit, net
|
7,078
|
7,119
|
(41
|
)
|
-1
|
%
|
||||||||||
Current obligations under long-term debt
|
766
|
629
|
137
|
22
|
%
|
|||||||||||
Income taxes payable
|
6
|
18
|
(12
|
)
|
-67
|
%
|
||||||||||
Warrant liabilities
|
—
|
3,739
|
(3,739
|
)
|
100
|
%
|
||||||||||
Deferred gain from sale-leaseback transactions
|
470
|
860
|
(390
|
)
|
-45
|
%
|
||||||||||
Total current liabilities
|
20,322
|
28,177
|
(7,855
|
)
|
-28
|
%
|
||||||||||
Long-term liabilities
|
||||||||||||||||
Long-term debt, less current portion
|
1,394
|
1,576
|
(182
|
)
|
-12
|
%
|
||||||||||
Accrued expenses, less current portion
|
52
|
15
|
37
|
247
|
%
|
|||||||||||
Deferred gain from sale-leaseback transactions, less current portion
|
—
|
40
|
(40
|
)
|
100
|
%
|
||||||||||
Total long-term liabilities
|
1,446
|
1,631
|
(185
|
)
|
-11
|
%
|
||||||||||
Total liabilities
|
21,768
|
29,808
|
(8,040
|
)
|
-27
|
%
|
||||||||||
Shareholders' equity:
|
||||||||||||||||
Preferred stock, no par value
|
3,138
|
3,138
|
—
|
0
|
%
|
|||||||||||
Common stock, no par value
|
245,230
|
233,394
|
11,836
|
5
|
%
|
|||||||||||
Accumulated deficit
|
(183,738
|
)
|
(181,507
|
)
|
(2,231
|
)
|
1
|
%
|
||||||||
Total shareholders' equity
|
64,630
|
55,025
|
9,605
|
17
|
%
|
|||||||||||
Total liabilities and shareholders' equity
|
$
|
86,398
|
$
|
84,833
|
$
|
1,565
|
2
|
%
|
||||||||
Net working capital
|
$
|
14,771
|
$
|
4,871
|
$
|
9,900
|
203
|
%
|
(D)
|
Five Quarter Statement of Operations and Adjusted EBITDA
|
For the three months ended
|
||||||||||||||||||||||||||||||||||||||||
($ in thousands)
(unaudited)
|
December 31,
2016
|
% of Sales
|
September 30,
2016
|
% of Sales
|
June 30,
2016
|
% of Sales
|
March 31,
2016
|
% of Sales
|
December 31,
2015
|
% of Sales
|
||||||||||||||||||||||||||||||
Revenues:
|
||||||||||||||||||||||||||||||||||||||||
License and transaction fees
|
$
|
16,639
|
76.5
|
%
|
$
|
16,365
|
75.8
|
%
|
$
|
15,263
|
69.6
|
%
|
$
|
14,727
|
72.3
|
%
|
$
|
13,674
|
73.9
|
%
|
||||||||||||||||||||
Equipment Sales
|
5,117
|
23.5
|
%
|
5,223
|
24.2
|
%
|
6,681
|
30.4
|
%
|
5,634
|
27.7
|
%
|
4,829
|
26.1
|
%
|
|||||||||||||||||||||||||
Total revenue
|
21,756
|
100.0
|
%
|
21,588
|
100.0
|
%
|
21,944
|
100.0
|
%
|
20,361
|
100.0
|
%
|
18,503
|
100.0
|
%
|
|||||||||||||||||||||||||
Costs of sales/revenues:
|
||||||||||||||||||||||||||||||||||||||||
License and transaction fees
|
11,389
|
68.4
|
%
|
11,243
|
68.7
|
%
|
10,614
|
69.5
|
%
|
9,703
|
65.9
|
%
|
9,067
|
66.3
|
%
|
|||||||||||||||||||||||||
Equipment sales
|
4,033
|
78.8
|
%
|
4,178
|
80.0
|
%
|
5,547
|
83.0
|
%
|
4,986
|
88.5
|
%
|
3,953
|
81.9
|
%
|
|||||||||||||||||||||||||
Total costs of sales/revenues
|
15,422
|
70.9
|
%
|
15,421
|
71.4
|
%
|
16,161
|
73.6
|
%
|
14,689
|
72.1
|
%
|
13,020
|
70.4
|
%
|
|||||||||||||||||||||||||
Gross Profit:
|
||||||||||||||||||||||||||||||||||||||||
License and transaction fees
|
5,250
|
31.6
|
%
|
5,122
|
31.3
|
%
|
4,649
|
30.5
|
%
|
5,024
|
34.1
|
%
|
4,607
|
33.7
|
%
|
|||||||||||||||||||||||||
Equipment sales
|
1,084
|
21.2
|
%
|
1,045
|
20.0
|
%
|
1,134
|
17.0
|
%
|
648
|
11.5
|
%
|
876
|
18.1
|
%
|
|||||||||||||||||||||||||
Total gross profit
|
6,334
|
29.1
|
%
|
6,167
|
28.6
|
%
|
5,783
|
26.4
|
%
|
5,672
|
27.9
|
%
|
5,483
|
29.6
|
%
|
|||||||||||||||||||||||||
Operating expenses:
|
||||||||||||||||||||||||||||||||||||||||
Selling, general and administrative
|
5,793
|
26.6
|
%
|
6,909
|
32.0
|
%
|
6,721
|
30.6
|
%
|
6,094
|
29.9
|
%
|
4,762
|
25.7
|
%
|
|||||||||||||||||||||||||
Depreciation
|
307
|
1.4
|
%
|
208
|
1.0
|
%
|
208
|
0.9
|
%
|
173
|
0.8
|
%
|
127
|
0.7
|
%
|
|||||||||||||||||||||||||
Impairment of intangible asset
|
—
|
0.0
|
%
|
—
|
0.0
|
%
|
432
|
2.0
|
%
|
—
|
0.0
|
%
|
—
|
0.0
|
%
|
|||||||||||||||||||||||||
Total operating expenses
|
6,100
|
28.0
|
%
|
7,117
|
33.0
|
%
|
7,361
|
33.5
|
%
|
6,267
|
30.8
|
%
|
4,889
|
26.4
|
%
|
|||||||||||||||||||||||||
Operating income (loss)
|
234
|
1.1
|
%
|
(950
|
)
|
-4.4
|
%
|
(1,578
|
)
|
-7.2
|
%
|
(595
|
)
|
-2.9
|
%
|
594
|
3.2
|
%
|
||||||||||||||||||||||
Other income (expense):
|
||||||||||||||||||||||||||||||||||||||||
Interest income
|
200
|
0.9
|
%
|
73
|
0.3
|
%
|
182
|
0.8
|
%
|
67
|
0.3
|
%
|
20
|
0.1
|
%
|
|||||||||||||||||||||||||
Other income
|
—
|
0.0
|
%
|
—
|
0.0
|
%
|
—
|
0.0
|
%
|
—
|
0.0
|
%
|
—
|
0.0
|
%
|
|||||||||||||||||||||||||
Interest expense
|
(201
|
)
|
-0.9
|
%
|
(212
|
)
|
-1.0
|
%
|
(197
|
)
|
-0.9
|
%
|
(180
|
)
|
-0.9
|
%
|
(104
|
)
|
-0.6
|
%
|
||||||||||||||||||||
Change in fair value of warrant liabilities
|
—
|
0.0
|
%
|
(1,490
|
)
|
-6.9
|
%
|
18
|
0.1
|
%
|
(4,805
|
)
|
-23.6
|
%
|
(1,230
|
)
|
-6.6
|
%
|
||||||||||||||||||||||
Total other income (expense), net
|
(1
|
)
|
0.0
|
%
|
(1,629
|
)
|
-7.5
|
%
|
3
|
0.0
|
%
|
(4,918
|
)
|
-24.2
|
%
|
(1,314
|
)
|
-7.1
|
%
|
|||||||||||||||||||||
Loss before provision for income taxes
|
233
|
1.1
|
%
|
(2,579
|
)
|
-11.9
|
%
|
(1,575
|
)
|
-7.2
|
%
|
(5,513
|
)
|
-27.1
|
%
|
(720
|
)
|
-3.9
|
%
|
|||||||||||||||||||||
Benefit (provision) for income taxes
|
—
|
0.0
|
%
|
115
|
0.5
|
%
|
703
|
3.2
|
%
|
93
|
0.5
|
%
|
(154
|
)
|
-0.8
|
%
|
||||||||||||||||||||||||
Net income (loss)
|
233
|
1.1
|
%
|
(2,464
|
)
|
-11.4
|
%
|
(872
|
)
|
-4.0
|
%
|
(5,420
|
)
|
-26.6
|
%
|
(874
|
)
|
-4.7
|
%
|
|||||||||||||||||||||
Less interest income
|
(200
|
)
|
-0.9
|
%
|
(73
|
)
|
-0.3
|
%
|
(182
|
)
|
-0.8
|
%
|
(67
|
)
|
-0.3
|
%
|
(20
|
)
|
-0.1
|
%
|
||||||||||||||||||||
Plus interest expenses
|
201
|
0.9
|
%
|
212
|
1.0
|
%
|
197
|
0.9
|
%
|
180
|
0.9
|
%
|
104
|
0.6
|
%
|
|||||||||||||||||||||||||
Plus income tax expense
|
—
|
0.0
|
%
|
(115
|
)
|
-0.5
|
%
|
(703
|
)
|
-3.2
|
%
|
(93
|
)
|
-0.5
|
%
|
154
|
0.8
|
%
|
||||||||||||||||||||||
Plus depreciation expense
|
1,220
|
5.6
|
%
|
1,257
|
5.8
|
%
|
1,272
|
5.8
|
%
|
1,190
|
5.8
|
%
|
1,323
|
7.2
|
%
|
|||||||||||||||||||||||||
Plus amortization expense
|
43
|
0.2
|
%
|
44
|
0.2
|
%
|
44
|
0.2
|
%
|
44
|
0.2
|
%
|
—
|
0.0
|
%
|
|||||||||||||||||||||||||
Plus (less) change in fair value of warrant liabilities
|
—
|
0.0
|
%
|
1,490
|
6.9
|
%
|
(18
|
)
|
-0.1
|
%
|
4,805
|
23.6
|
%
|
1,230
|
6.6
|
%
|
||||||||||||||||||||||||
Plus stock-based compensation
|
233
|
1.1
|
%
|
211
|
1.0
|
%
|
198
|
0.9
|
%
|
142
|
0.7
|
%
|
237
|
1.3
|
%
|
|||||||||||||||||||||||||
Plus intangible asset impairment
|
—
|
0.0
|
%
|
—
|
0.0
|
%
|
432
|
2.0
|
%
|
—
|
0.0
|
%
|
—
|
0.0
|
%
|
|||||||||||||||||||||||||
Plus VendScreen non-recurring charges
|
8
|
0.0
|
%
|
101
|
0.5
|
%
|
258
|
1.2
|
%
|
461
|
2.3
|
%
|
106
|
0.6
|
%
|
|||||||||||||||||||||||||
Plus litigation related professional fees
|
—
|
0.0
|
%
|
33
|
0.2
|
%
|
0.0
|
%
|
105
|
0.5
|
%
|
—
|
0.0
|
%
|
||||||||||||||||||||||||||
Adjusted EBITDA
|
$
|
1,738
|
8.0
|
%
|
$
|
696
|
3.2
|
%
|
$
|
626
|
2.9
|
%
|
$
|
1,347
|
6.6
|
%
|
$
|
2,260
|
12.2
|
%
|
(E)
|
Five Quarter and YTD Selling, General, & Administrative Expenses
|
Three months ended
|
||||||||||||||||||||||||||||||||||||||||
($ in thousands)
|
December 31,
2016
|
% of
SG&A
|
September 30,
2016
|
% of
SG&A
|
June 30,
2016
|
% of
SG&A
|
March 31,
2016
|
% of
SG&A
|
December 31,
2015
|
% of
SG&A
|
||||||||||||||||||||||||||||||
Salaries and benefit costs
|
$
|
2,849
|
49.2
|
%
|
$
|
3,129
|
45.3
|
%
|
$
|
3,050
|
45.4
|
%
|
$
|
2,760
|
45.4
|
%
|
$
|
2,786
|
58.6
|
%
|
||||||||||||||||||||
Marketing related expenses
|
578
|
10.0
|
%
|
329
|
4.8
|
%
|
635
|
9.4
|
%
|
362
|
5.9
|
%
|
335
|
7.0
|
%
|
|||||||||||||||||||||||||
Professional services
|
1,213
|
20.9
|
%
|
2,520
|
36.5
|
%
|
1,533
|
22.8
|
%
|
1,152
|
18.9
|
%
|
839
|
17.6
|
%
|
|||||||||||||||||||||||||
Bad debt expense
|
352
|
6.1
|
%
|
97
|
1.4
|
%
|
470
|
7.0
|
%
|
505
|
8.3
|
%
|
239
|
5.0
|
%
|
|||||||||||||||||||||||||
Premises, equipment and insurance costs
|
498
|
8.6
|
%
|
499
|
7.2
|
%
|
555
|
8.3
|
%
|
460
|
7.5
|
%
|
347
|
7.3
|
%
|
|||||||||||||||||||||||||
Research and development expenses
|
173
|
3.0
|
%
|
124
|
1.8
|
%
|
123
|
1.8
|
%
|
131
|
2.1
|
%
|
37
|
0.8
|
%
|
|||||||||||||||||||||||||
VendScreen non-recurring charges
|
8
|
0.1
|
%
|
101
|
1.5
|
%
|
258
|
3.8
|
%
|
461
|
7.6
|
%
|
106
|
2.2
|
%
|
|||||||||||||||||||||||||
Litigation related professional fees
|
—
|
0.0
|
%
|
33
|
0.5
|
%
|
51
|
0.8
|
%
|
105
|
1.7
|
%
|
—
|
0.0
|
%
|
|||||||||||||||||||||||||
Other expenses
|
122
|
2.1
|
%
|
77
|
1.1
|
%
|
46
|
0.7
|
%
|
158
|
2.6
|
%
|
73
|
1.5
|
%
|
|||||||||||||||||||||||||
Total SG&A expenses
|
$
|