Pennsylvania
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001-33365
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232679963
|
||||
(State or other jurisdiction of incorporation
or organization) |
(Commission
File Number) |
(IRS employer
identification number) |
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100 Deerfield Lane, Suite 300
|
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Malvern, Pennsylvania
|
19355
|
|||||
(Address of principal executive offices)
|
(Zip code)
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Title of each class
|
Trading
Symbol(s)
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Name of each exchange on which registered
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None
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None
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None
|
Exhibit No.
|
Description
|
USA TECHNOLOGIES, INC. |
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|
By:
|
/s/ Davina Furnish |
|
Davina Furnish |
|||
General Counsel and Secretary |
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Dated: November 5, 2020 |
•
|
Revenue of $36.9 million, an increase of 13.0% versus fourth quarter 2020, and a decrease of 15.0% year over year
|
o
|
License and transaction fee revenue of $33.1 million, a decrease of 4.3% year-over-year and an increase of 18.9% versus fourth quarter 2020
|
o
|
Equipment revenue of $3.8 million, a decrease of 21.5% over fourth quarter 2020 and decrease of 56.9% year over year
|
•
|
Net new connections of approximately 15,000 bring total connections to approximately 1,335,000
|
•
|
Gross margin of 38.6% compared with 26.3% in the prior year period
|
•
|
Operating loss of $(3.6) million compared to operating loss of $(11.3) million in the prior year period
|
•
|
Net loss applicable to common shares of $(6.9) million, or $(0.11) per basic share compared to net loss applicable to common shares of $(11.8) million, or $(0.20) per basic share in the prior year period
|
•
|
Adjusted EBITDA of $(0.5) million compared to $(4.9) million in the prior year period
|
•
|
Ended the quarter with $34.7 million in cash and cash equivalents
|
•
|
Announced the upgrade and expansion of the Company’s ePort product portfolio to now accept EMV contact and contactless payments
|
•
|
New Senior Hires include Chief Accounting Officer, Scott Stewart and the return of Denis Kouznetsov, now the Company’s Chief Architect
|
•
|
Worked to become a more customer-centric organization. Hired two new regional sales directors and built out customer service teams
|
•
|
Key customer wins including a large Operator in the Midwest, FreshBrew Vending, and Continental Vending, Inc.
|
•
|
Revenue to be between $170 million and $180 million
|
•
|
Net loss applicable to common shares to be between $(14.1) million and $(11.1) million
|
•
|
Adjusted EBITDA to be between $2 million and $5 million.
|
($ in thousands, except share data)
|
September 30,
2020 |
June 30,
2020 |
||||||
Assets
|
||||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$
|
34,690
|
$
|
31,713
|
||||
Accounts receivable, less allowance of $7,313 and $7,676, respectively
|
19,175
|
17,273
|
||||||
Finance receivables, net
|
7,356
|
7,468
|
||||||
Inventory, net
|
7,005
|
9,128
|
||||||
Prepaid expenses and other current assets
|
1,545
|
1,782
|
||||||
Total current assets
|
69,771
|
67,364
|
||||||
Non-current assets:
|
||||||||
Finance receivables due after one year
|
10,385
|
11,213
|
||||||
Other assets
|
2,156
|
1,993
|
||||||
Property and equipment, net
|
7,526
|
7,872
|
||||||
Operating lease right-of-use assets
|
5,417
|
5,603
|
||||||
Intangibles, net
|
22,249
|
23,033
|
||||||
Goodwill
|
63,945
|
63,945
|
||||||
Total non-current assets
|
111,678
|
113,659
|
||||||
Total assets
|
$
|
181,449
|
$
|
181,023
|
||||
Liabilities, convertible preferred stock and shareholders’ equity
|
||||||||
Current liabilities:
|
||||||||
Accounts payable
|
$
|
31,791
|
$
|
27,058
|
||||
Accrued expenses
|
28,880
|
30,265
|
||||||
Finance lease obligations and current obligations under long-term debt
|
3,871
|
3,328
|
||||||
Deferred revenue
|
1,639
|
1,698
|
||||||
Total current liabilities
|
66,181
|
62,349
|
||||||
Long-term liabilities:
|
||||||||
Deferred income taxes
|
143
|
137
|
||||||
Finance lease obligations and long-term debt, less current portion
|
14,066
|
12,435
|
||||||
Operating lease liabilities, non-current
|
4,469
|
4,749
|
||||||
Total long-term liabilities
|
18,678
|
17,321
|
||||||
Total liabilities
|
84,859
|
79,670
|
||||||
Commitments and contingencies (Note 13)
|
||||||||
Convertible preferred stock:
|
||||||||
Series A convertible preferred stock, 900,000 shares authorized, 445,063 issued and outstanding, with liquidation preferences of $21,113 and $20,779 at September 30, 2020 and June 30, 2020, respectively
|
3,138
|
3,138
|
||||||
Shareholders’ equity:
|
||||||||
Preferred stock, no par value, 1,800,000 shares authorized, no shares issued
|
—
|
—
|
||||||
Common stock, no par value, 640,000,000 shares authorized, 65,252,965 and 65,196,882 shares issued and outstanding at September 30, 2020 and June 30, 2020, respectively
|
402,742
|
401,240
|
||||||
Accumulated deficit
|
(309,290)
|
(303,025)
|
||||||
Total shareholders’ equity
|
93,452
|
98,215
|
||||||
Total liabilities, convertible preferred stock and shareholders’ equity
|
$
|
181,449
|
$
|
181,023
|
Three months ended
|
||||||||
September 30,
|
||||||||
($ in thousands, except per share data)
|
2020
|
2019
|
||||||
Revenue:
|
||||||||
License and transaction fees
|
$
|
33,108
|
$
|
34,609
|
||||
Equipment sales
|
3,769
|
8,750
|
||||||
Total revenue
|
36,877
|
43,359
|
||||||
Costs of sales:
|
||||||||
Cost of services
|
19,336
|
22,089
|
||||||
Cost of equipment
|
3,301
|
9,854
|
||||||
Total costs of sales
|
22,637
|
31,943
|
||||||
Gross profit
|
14,240
|
11,416
|
||||||
Operating expenses:
|
||||||||
Selling, general and administrative
|
16,780
|
17,196
|
||||||
Investigation, proxy solicitation and restatement expenses
|
—
|
4,476
|
||||||
Depreciation and amortization
|
1,068
|
1,022
|
||||||
Total operating expenses
|
17,848
|
22,694
|
||||||
Operating loss
|
(3,608)
|
(11,278)
|
||||||
Other income (expense):
|
||||||||
Interest income
|
350
|
294
|
||||||
Interest expense
|
(3,315)
|
(465)
|
||||||
Total other income (expense), net
|
(2,965)
|
(171)
|
||||||
Loss before income taxes
|
(6,573)
|
(11,449)
|
||||||
Provision for income taxes
|
(40)
|
(59)
|
||||||
Net loss
|
(6,613)
|
(11,508)
|
||||||
Preferred dividends
|
(334)
|
(334)
|
||||||
Net loss applicable to common shares
|
$
|
(6,947)
|
$
|
(11,842)
|
||||
Net loss per common share
|
||||||||
Basic
|
$
|
(0.11)
|
$
|
(0.20)
|
||||
Diluted
|
$
|
(0.11)
|
$
|
(0.20)
|
||||
Weighted average number of common shares outstanding
|
||||||||
Basic
|
64,859,002
|
60,096,852
|
||||||
Diluted
|
64,859,002
|
60,096,852
|
Three months ended
|
||||||||
September 30,
|
||||||||
($ in thousands)
|
2020
|
2019
|
||||||
OPERATING ACTIVITIES:
|
||||||||
Net loss
|
$
|
(6,613)
|
$
|
(11,508)
|
||||
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
|
||||||||
Non-cash stock based compensation
|
1,509
|
290
|
||||||
Gain on disposal of property and equipment
|
(3)
|
(15)
|
||||||
Non-cash interest and amortization of debt discount
|
3,125
|
338
|
||||||
Bad debt expense
|
394
|
(110)
|
||||||
Provision for inventory reserve
|
802
|
574
|
||||||
Depreciation and amortization included in operating expenses
|
1,068
|
1,022
|
||||||
Depreciation included in cost of sales for rentals
|
539
|
634
|
||||||
Non-cash lease expense
|
269
|
491
|
||||||
Deferred income taxes
|
5
|
5
|
||||||
Changes in operating assets and liabilities:
|
||||||||
Accounts receivable
|
(1,540)
|
3,286
|
||||||
Finance receivables
|
531
|
(454)
|
||||||
Inventory
|
1,324
|
1,232
|
||||||
Prepaid expenses and other assets
|
100
|
(412)
|
||||||
Accounts payable and accrued expenses
|
3,985
|
5,288
|
||||||
Operating lease liabilities
|
(259)
|
(399)
|
||||||
Deferred revenue
|
(58)
|
(33)
|
||||||
Net cash provided by operating activities
|
5,178
|
229
|
||||||
INVESTING ACTIVITIES:
|
||||||||
Purchase of property and equipment
|
(483)
|
(420)
|
||||||
Proceeds from sale of property and equipment
|
8
|
30
|
||||||
Net cash used in investing activities
|
(475)
|
(390)
|
||||||
FINANCING ACTIVITIES:
|
||||||||
Proceeds from long-term debt issuance by JPMorgan Chase Bank, N.A., net of debt issuance costs
|
14,550
|
—
|
||||||
Repayment of finance lease obligations and long-term debt
|
(15,101)
|
(1,763)
|
||||||
Proceeds from exercise of common stock options
|
25
|
—
|
||||||
Payment of Antara prepayment penalty and commitment termination fee
|
(1,200)
|
—
|
||||||
Net cash used in financing activities
|
(1,726)
|
(1,763)
|
||||||
Net (decrease) increase in cash and cash equivalents
|
2,977
|
(1,924)
|
||||||
Cash and cash equivalents at beginning of year
|
31,713
|
27,464
|
||||||
Cash and cash equivalents at end of period
|
$
|
34,690
|
$
|
25,540
|
||||
Supplemental disclosures of cash flow information:
|
||||||||
Interest paid in cash
|
$
|
191
|
$
|
205
|
Three months ended September 30,
|
||||||||
($ in thousands)
|
2020
|
2019
|
||||||
Net loss
|
$
|
(6,613)
|
$
|
(11,508)
|
||||
Less: interest income
|
(350)
|
(294)
|
||||||
Plus: interest expense
|
3,315
|
465
|
||||||
Plus: income tax provision
|
40
|
59
|
||||||
Plus: depreciation expense included in cost of sales for rentals
|
539
|
634
|
||||||
Plus: depreciation and amortization expense in operating expenses
|
1,068
|
1,022
|
||||||
EBITDA
|
(2,001)
|
(9,622)
|
||||||
Plus: stock-based compensation
|
1,509
|
290
|
||||||
Plus: investigation, proxy solicitation and restatement expenses
|
—
|
4,476
|
||||||
Adjustments to EBITDA
|
1,509
|
4,766
|
||||||
Adjusted EBITDA
|
$
|
(492)
|
$
|
(4,856)
|