WESTLAKE VILLAGE, Calif., Feb. 7, 2017 /PRNewswire/ -- iPayment Holdings, Inc. ("Holdings") and iPayment, Inc. ("iPayment" or the "Company") today announced preliminary unaudited financial results for the fourth quarter and full year ended December 31, 2016. All operations are conducted through iPayment and its subsidiaries. Holdings is a holding company that does not have any operations or material assets, other than its ownership of iPayment and its subsidiaries. The financial results of Holdings are substantially the same as those of iPayment with the exception of interest expense, income tax provision (benefit) and net and comprehensive income (loss). The financial results discussed below represent those of iPayment and its consolidated subsidiaries, except where otherwise noted.
Fourth Quarter Highlights
- Total Revenue in the fourth quarter was approximately $202.2 million, representing a $17.3 million, or 9.3%, increase over the fourth quarter of the prior year.
- Total Net Revenue in the fourth quarter was approximately $95.4 million, representing a $7.7 million, or 8.8%, increase over the fourth quarter of the prior year.
- The Company expects fourth quarter Adjusted EBITDA to be within the range of $28.9 million to $29.9 million, representing an estimated increase of 15.7% to 19.7% over the fourth quarter of the prior year. Adjusted EBITDA includes approximately $6.4 million in adjustments for extraordinary charges in the quarter.
Fiscal Year Highlights
- Total Revenue for full year 2016 was approximately $765.0 million, representing a $39.5 million, or 5.4%, increase over the prior year.
- Total Net Revenue for full year 2016 was approximately $349.0 million, representing a $16.9 million, or 5.1%, increase over the prior year.
- The Company expects full year 2016 Adjusted EBITDA to be within the range of $94.9 million to $95.9 million, representing an estimated increase of 3.4% to 4.5% over the prior year. Adjusted EBITDA includes approximately $8.3 million in adjustments for extraordinary charges in the year.
- Cash balance and total principal debt at December 31, 2016 were $8.2 million and $696.0 million, respectively which reflects a $7.5 million debt repayment at year end.
The Company anticipates disclosing more details to our investor base regarding its fourth quarter and full year 2016 financial results in late March 2017. The unaudited financial information presented in this press release is subject to review and updating in connection with iPayment's 2016 audit.
O.B. Rawls IV, CEO, iPayment noted, "As an organization we remain committed to delivering incremental value to our small business customers and our partners. These results are a direct reflection of those efforts and our keen focus on continuous improvement."
Information in this press release may contain "forward-looking statements" about the Company and Holdings. These forward-looking statements are subject to risks, uncertainties and assumptions, many of which are beyond our control, and are not guarantees of future results, performance or achievements, and actual results, performance or achievements could differ materially from our current expectations as a result of numerous factors, including but not limited to the following: the effect of pending and threatened litigation; acquisitions; liability for merchant chargebacks; restrictive covenants governing our indebtedness; migration of merchant portfolios to new bank sponsors; our reliance on card payment processors and on independent sales organizations; changes in interchange fees; risks associated with the unauthorized disclosure of data; imposition of taxes on Internet transactions; actions by our competitors; and risks related to the integration of companies and merchant portfolios that we have acquired or may acquire. We undertake no obligation to revise or update any forward-looking statements in order to reflect events or circumstances that may arise after the date of this release.
Adjusted EBITDA (Non-GAAP)
Adjusted EBITDA has limitations as an analytical tool, and you should not consider it in isolation or as a substitute for analysis of the Company's results as reported under GAAP. For example, Adjusted EBITDA:
- does not reflect the Company's historical cash expenditures, or future requirements, for capital expenditures or contractual commitments;
- does not reflect changes in, or cash requirements for, our working capital needs;
- does not reflect the significant interest expense or the cash requirements necessary to service interest or principal payments on our debt;
- does not reflect our income tax expenses or the cash requirements to pay our taxes; and
- although depreciation and amortization charges are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and the foregoing metrics do not reflect any cash requirements for such replacements.
Adjusted EBITDA is commonly used by management and investors as performance measures and liquidity indicators. We consider Adjusted EBITDA to be a key indicator of our ability to service our debt. Other companies in our industry may calculate Adjusted EBITDA differently than we do, limiting its usefulness as a comparative measure. Because of this limitation, Adjusted EBITDA should not be considered a measure of discretionary cash available to us to invest in the growth of our business. We compensate for this limitation by relying primarily on the Company's GAAP results and using Adjusted EBITDA for supplemental purposes only. Additionally, Adjusted EBITDA is not an alternative measure of financial performance under GAAP and therefore should be considered in conjunction with net and comprehensive income (loss) and other performance measures such as operating income or net cash provided by operating activities and not as alternatives to such GAAP measures. In evaluating this non-GAAP financial measure, be aware that in the future we may incur expenses similar to the expenses eliminated in this presentation. Our presentation of Adjusted EBITDA should not be construed as an inference that our future results will not be affected by unusual or non-recurring items.
iPayment is a trusted provider of payment processing solutions in the U.S. With over 18 years of experience and more than 140,000 SMB customers, the company is consistently recognized for its depth of payments experience, breadth of product offerings, and commitment to transparency and SMB support. From new product innovation to customer service satisfaction, iPayment is an organization focused on small business enablement and delivering relevant and impactful services and solutions that help partners and SMB customers grow their individual businesses. For more information on iPayment, please visit http://www.ipaymentinc.com.
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SOURCE iPayment, Inc.