Planet Payment, Inc. (UK: LSE:AIM: PPT and PPTR; USA: OTCQX: PLPM), a leading international payment processor, today announced its results for the three month period ended March 31, 2011.
During the first quarter of 2011 the Company continued to deliver solid results. Total revenue was up 67% to $22.0 million (Q1’10: $13.2 million), with multi-currency revenue up over 85% to $18.6 million (Q1’10: $10.0 million). Gross profit for the quarter increased 65% to $6.7 million (Q1’10: $4.1 million).
On a GAAP basis, net income for the quarter was $0.9 million (Q1’10 net loss: ($1.5m)). Adjusted EBITDA for the period was $1.0 million (Q1’10 loss: ($0.7m). See Table 1 for reconciliation of net income (loss) to Adjusted EBITDA.
The Company’s revenue growth was primarily driven by a 67% increase in active multi-currency merchant locations over Q1’10. The Company’s total active merchant locations were at 19,944 at the end of the quarter with 8,755 new locations activated since the first quarter of 2010 (Q1’10: 11,189). First quarter has traditionally been the Company’s slowest quarter of the year, due primarily to reduced international business travel following the Christmas holiday and around the Chinese New Year, while fourth quarter is typically the most active. Due to our product mix and broadening customer and regional base, this quarter’s seasonal, sequential revenue increase was approximately 3%. This compares very favorably to previous seasonal revenue declines of 7% (Q1: 2010) and 12% (Q1:2009) as compared to the fourth quarters of 2009 and 2008, respectively.
Planet Payment also continues to benefit from a robust new business pipeline. Approximately 43% of multi-currency transaction volume processed in the month of March 2011 was attributed to merchants activated since March 2010, with 8% of the March 2011 volume derived from merchant locations activated in the first quarter of 2011.
Since the beginning of the year, the Company has continued to roll out services in the United Arab Emirates, the Philippines and other Asia Pacific countries launched in 2010 and with additional acquirers in Canada. In support of these new service launches, the Company’s cash operating expenses increased by 19% or $0.9 million as compared to the same period a year ago. The Company also continues to enhance functionality, stability and security of its processing infrastructure to support its more than 45 acquiring banks and processors and their merchant customers. Planet Payment is also working to implement additional bank and merchant solutions planned for the remainder of 2011.
In January we announced a new long term contract with Global Payments for multi-currency services in the United States and Canada, complementing the existing agreements in the Asia Pacific region.
In March we announced the expansion of our agreement with Fifth Third Processing Solutions, to offer Pay in Your Currency on ATMs throughout the United States..
Commenting on the results, Philip Beck, Chairman of Planet Payment, Inc., said:
“We are very pleased with our first quarter results. Our revenue growth of 67%, is especially gratifying, given that it has traditionally been our seasonally weakest quarter of the year. First quarter performance resulted from the strong adoption and the continued deployment of our solutions by new and existing customers which is a reflection of the tremendous efforts of the entire Planet Payment team over the last few years.”
On April 26, 2011 we announced that investors led by Camden Partners had converted their entire approximately $9 million of Convertible Promissory Notes plus interest into 4,474,776 Common Shares. This transaction strengthens the Company’s balance sheet and eliminates approximately $800,000 in annual interest payments