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VendTek Reports Quarterly Results

Thursday 30 September 2004 15:20 CET | News

VendTek Systems has reported that revenues rose 83% to $14,553,000 for the nine-month period ending July 31, 2004 compared to $7,948,000 for the same period of 2003.

The nine-month period of 2004 revenues are comprised of prepaid PIN revenue of $14,169,000 (9mo2003 - $7,401,000), license and engineering revenues of $48,900 (9mo2003 - $253,000), and systems and parts sales of $336,000 (9mo2003 - $294,000). The consolidated gross profit for the nine-month period ending July 31, 2004 was $637,000 compared to $407,000 for the same period of 2003, an increase of 57%. The high revenues generated by Now Prepay accounted for the majority of the consolidated gross profits that remain indicative of the low margin virtual prepaid telecommunications industry in which Now Prepay conducts its business. The ongoing installation of POS terminals across Canada for the sale of virtual prepaid telecommunications vouchers provides meaningful revenues which are augmented by the wholesale portion of Now Prepay’s prepaid cellular business. License and engineering revenues were down 81% ($204,000) due to a reduction in engineering services supplied. This was partially offset by a 14% ($41,000) increase in systems and parts revenues derived from the sale of a server in Malaysia and parts sold in Canada. Due to a reallocation of expenses general and administration (“G&A”) expenses increased by $398,000 (62%) to $1,042,000 for the nine-month period ending July 31, 2004 compared to $644,000 for the period of 2003. Salaries under G&A increased $260,000 (112%) with the appropriate re-allocation of Now Prepay management wage expenses from sales to G&A; travel and promotional expenses were up $10,000 (205%) due to increased travel and entertainment expenses; office, telecommunications, rent, amortization and interest expenses rose $102,000 (32%) due to increased costs associated with Now Prepay telecommunication lines and increased paper and postage costs, transaction costs as well as an increase in rent and insurance expenses; accounting and legal fees increased $4,000 (5%) due to increased legal expenses in the quarter; computer expenses increased by $14,000 (207%) due to the purchase of computers to act as demonstration and active servers in Asia and Canada, banking charges increased $7,000 (85%) due to increased electronics funds transfer charges related to the collection of Now Prepay revenues; investor relations costs increased by $10,000 (51%) due to increased services. The reallocation of expenses to G&A caused engineering expenses to decrease $95,000 (-67%) to $194,000 for the nine-month period ending July 31, 2004 compared to $289,000 for the same period of 2003. The reduction is offset by an increased use of contract engineering, and additional engineering staff in VendTek Technologies Beijing. Selling and marketing expenses decreased $83,000 (-62%) to $134,000 for the nine-month period ending July 31, 2004 compared to $216,000 for the same period of 2003. The decrease is due to the reallocation of sales wage expense to G&A. The reduction is offset by an increase in business travel during 2004. Net loss for the nine-month period ending July 31, 2004 decreased by $12,000 (2%) to $733,340 when compared with a loss of $746,000 for the same period of 2003. This increase in earnings was due to higher systems revenues and increased virtual telecommunication sales in the nine-month period ending July 31, 2004 compared to the same period in 2003. The earnings are offset by increased expenses in wages, telecommunication, office and computer expenses. The net loss per share for the nine-month period ending July 31, 2004 remained at ($0.01) when compared to the same period of 2003.


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Categories: Payments & Commerce | Payments General
Countries: World
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