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JetPay® Corporation Announces 2017 Financial ResultsALLENTOWN, Pa., March 28, 2018 (GLOBE NEWSWIRE) -- JetPay® Corporation (“JetPay” or the “Company”) (NASDAQ:JTPY) announced financial results for the fourth quarter and year ended December 31, 2017. Financial Highlights
News Highlights
“I am proud of JetPay’s company-wide revenue growth in excess of 30% for the third consecutive year, along with revenue growth in excess of 40% in our Payments Services Segment during this period,” stated Diane (Vogt) Faro, CEO of JetPay Corporation. “Our Payments and HR & Payroll businesses both had record years. We expect to carry this momentum into 2018, as we continue to integrate with the State of Illinois with significant impact starting in the second quarter of 2018, increase revenues with our new cash discount product, JetX, and increase the number and quality of key strategic relationships in both our Payment Services and HR & Payroll Services Segments. Our growth reflects an increasing ability to leverage our fixed cost base, and we anticipate continued improvement in margins in future quarters,” Ms. Faro added. Fourth Quarter 2017 Compared to Fourth Quarter 2016 Revenues were $19.9 million for the three months ended December 31, 2017, compared to $17.3 million for the same period in 2016. Revenues for the Payment Services Segment increased $2.2 million, or 17.4%, for the three months ended December 31, 2017, compared to the same period in 2016. The increase was attributable to net revenue growth in our Government and Utilities, e-Commerce, and ISO/ISV sectors, including an increase in revenues in our cash discount product, JetX. Revenues for HR and Payroll Services Segment increased by $426,000, or 9.4%, for the three months ended December 31, 2017, compared to the same period in 2016. This increase was largely attributable to the increasing demand for our full-suite human capital management services. Operating (loss) income for the three months ended December 31, 2017, was $(404,000), compared to $115,000 for the same period in 2016. Operating (loss) income includes depreciation and amortization expense of $1.2 million and $1.0 million for the three months ended December 31, 2017 and 2016, respectively. The decrease in operating income was primarily attributable to an unfavorable change in the fair value of contingent consideration liability of $464,000 for the three months ended December 31, 2017, compared with a favorable change of $337,000 for the same period in 2016. This $801,000 year-over-year change in fair value of contingent consideration liability was partially offset by an increase in gross profit of $302,000, while selling, general, and administrative (“SG&A”) expenses were $4.8 million in both the three months ended December 31, 2017 and 2016. Net loss for the three months ended December 31, 2017, was $(709,000), or a net loss applicable to common stockholders of $(3.9) million after accretion of convertible preferred stock of $2.9 million, compared to a net loss of approximately $(355,000), or a net loss applicable to common stockholders of $(2.3) million after accretion of convertible preferred stock of $2.0 million for the same period in 2016. Fiscal Year 2017 Compared to Fiscal Year 2016 Revenues increased 35.0% to $76.0 million for the year ended December 31, 2017, compared to $56.3 million for the same period in 2016, representing an increase of $19.7 million. Revenues for the Payment Services Segment increased 44.5%, or $18.1 million, for the year ended December 31, 2017, compared to the same period in 2016. This increase included revenue growth from the acquisition of our Government and Utility payments operation, which contributed an incremental $11.3 million of revenues in 2017, and continued growth in our e-Commerce, and ISO/ISV sectors, including growth in our cash discount product, JetX. Revenues for the HR & Payroll Services Segment increased $1.7 million, or 10.7%, for the year ended December 31, 2017, compared to the same period in 2016. This increase was largely attributable to the increasing demand for our full-suite, human capital management product, WorkForceToday®. Operating loss for the year ended December 31, 2017, was $(1.3) million, compared to $(8.1) million for the same period in 2016. Operating loss includes depreciation and amortization expense of $4.5 million and $4.0 million for the years ended December 31, 2017 and 2016, respectively. The decrease in operating loss was partially related to the acquisition of JetPay Payment Services, FL, which contributed an incremental $1.4 million of operating income in 2017, as well as a $6.5 million reduction in professional fees for non-repetitive matters and legal settlement costs, all partially offset by an increase in the fair value of contingent consideration liability by $224,000 and an increase in non-cash loss on disposal of fixed assets of $110,000. Net loss for the year ended December 31, 2017, was $(3.1) million, or a net loss applicable to common stockholders of $(13.5) million after accretion of convertible preferred stock of $10.4 million, resulting in a loss per share applicable to common stockholders of $(0.85), compared to a net loss of $(8.2) million, or a net loss applicable to common stockholders of $(14.6) million after accretion of convertible preferred stock of $6.4 million, resulting in a loss per share applicable to common stockholders of $(0.89) for the year ended December 31, 2016. The decrease in net loss was primarily related to the decrease in operating loss described above. Conference Call JetPay will conduct a conference call on Wednesday, April 4, 2018 at 9:00 AM EST (6:00 AM PST) to discuss these results and conduct a question and answer session. The participant conference call number is (855) 446-8217 (International Dial-In (509) 960-9039, conference ID: 9192938. There will also be access to a digital recording of the teleconference by calling (855) 859-2056 and entering the conference ID: 9192938. This will be available from two hours following the teleconference until Wednesday, April 11, 2018. About JetPay Corporation JetPay Corporation, based in Allentown, PA, is a leading provider of vertically integrated solutions for businesses including card acceptance, processing, payroll, payroll tax filing, human capital management services, and other financial transactions. JetPay provides a single vendor solution for payment services, debit and credit card processing, ACH services, and payroll and human capital management needs for businesses throughout the United States. The Company also offers low-cost payment choices for the employees of these businesses to replace costly alternatives. The Company's vertically aligned services provide customers with convenience and increased revenues by lowering payments-related costs and by designing innovative, customized solutions for internet, mobile, and cloud-based payments. Please visit www.jetpay.com for more information on what JetPay has to offer or call 866-4JetPay (866-453-8729). Non-GAAP Financial Measures This press release includes non-GAAP financial measures, EBITDA and adjusted EBITDA, as defined in Regulation G of the Securities Exchange Act of 1934, as amended. The Company reports its financial results in compliance with GAAP, but believes that also discussing non-GAAP measures provides investors with financial measures it uses in the management of its business. The Company defines EBITDA as operating income (loss), before interest, taxes, depreciation, amortization of intangibles, and non-cash changes in the fair value of contingent consideration liability. The Company defines adjusted EBITDA as EBITDA, as defined above, plus certain non-recurring items, including certain legal and professional costs for non-repetitive matters, legal settlement costs, non-cash stock option costs, and non-cash losses on the disposal of fixed assets. These measures may not be comparable to similarly titled measures reported by other companies. Management uses EBITDA and adjusted EBITDA as indicators of the Company’s operating performance and ability to fund acquisitions, capital expenditures and other investments and, in the absence of refinancing options, to repay debt obligations. Management believes EBITDA and adjusted EBITDA are helpful to investors in evaluating the Company’s operating performance because non-cash costs and other items that management believes are not indicative of its results of operations are excluded. EBITDA and adjusted EBITDA are supplemental non-GAAP measures, which have limitations as an analytical tool. Non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. Non-GAAP financial measures do not reflect a comprehensive system of accounting, may differ from GAAP measures with the same names, and may differ from non-GAAP financial measures with the same or similar names that are used by other companies. For a description of our use of EBITDA and adjusted EBITDA and a reconciliation of EBITDA and adjusted EBITDA to operating income (loss), see the section of this press release titled “EBITDA and adjusted EBITDA Reconciliation.” EBITDA and Adjusted EBITDA Reconciliation
Forward-Looking Statements This press release includes “forward-looking statements” within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. JetPay’s actual results may differ from its expectations, estimates and projections and consequently, you should not rely on these forward-looking statements as predictions of future events. Words such as “expect,” “estimate,” “project,” “budget,” “forecast,” “anticipate,” “intend,” “plan,” “may,” “will,” “could,” “should,” “believes,” “predicts,” “potential,” “continue,” and similar expressions are intended to identify such forward-looking statements. These forward-looking statements involve significant risks and uncertainties that could cause the actual results to differ materially from the expected results. Many of these factors are outside JetPay’s control and are difficult to predict. Factors that may cause such differences include, but are not limited to, those described under the heading “Risk Factors” in the Company’s Annual Report for the fiscal year ended December 31, filed with the Securities and Exchange Commission (“SEC”) on Form 10-K for the fiscal year ended December 31, 2017, the Company’s Quarterly Reports on Forms 10-Q and the Company’s Current Reports on Form 8-K. JetPay cautions that the foregoing list of factors is not exclusive. Additional information concerning these and other risk factors is contained in JetPay’s most recent filings with the SEC. All subsequent written and oral forward-looking statements concerning JetPay or other matters and attributable to JetPay or any person acting on its behalf, are expressly qualified in their entirety by the cautionary statements above. JetPay cautions readers not to place undue reliance upon any forward-looking statements, which speak only as of the date made. JetPay does not undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any change in its expectations or any change in events, conditions or circumstances on which any such statement is based. Contacts JetPay Corporation JetPay Corporation
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