TORONTO, ONTARIO — (Marketwire) — 08/29/11 — VersaPay Corporation (TSX VENTURE: VPY) (“VersaPay” or the “Company”), a provider of merchant credit, debit, gift and loyalty card payment processing and e-mail money transfer (EMT) solutions, today announced its financial and operational results for the three month and six month periods ended June 30, 2011. All amounts are in Canadian dollars unless otherwise noted.
“Our improved top line and Adjusted EBITDA results for the quarter reflect the continued expansion of our merchant relationships” said Bill McGill, CEO of VersaPay. “In addition, despite the increase in professional fees due to the Company-s conversion to IFRS and expenses related to our first Annual General Meeting in the second quarter, our Adjusted EBITDA benefited from the cost controls we began implementing 2010. During the quarter, we also continued to lay the foundations for future growth with our VersaPay by continuing to invest in sales and marketing and product development. Looking ahead, we believe that we are positioned to build upon these results in the coming periods.”
Q2 and Year to Date 2011 Financial Review
Total revenue for Q2 2011 increased 23% to $3.8 million from $3.1 million in Q2 2010. Of this amount, recurring revenue for Q2 2011 increased 25% to $3.7 million from $3.0 million in Q2 2010. The year-over-year improvement was driven primarily by growth in the Company-s transaction processing fees.
Cash operating expense (excluding amortization, listing expense and share-based payments) decreased 26% to $0.9 million from $1.3 million in Q2 2011 from the same period 2010.
Adjusted EBITDA for Q2 2011 was $(0.2) million, compared to $(0.5) million in Q2 2010, reflecting the Company-s revenue growth and the implementation of cost control measures.
Loss from continuing operations for Q2 2011 was $(0.3) million. This compares to a loss from continuing operations of $(0.6) million for Q2 2010.
Executive Officers
The Company also announced that following the re-election of the Board of Directors at the Company-s Annual General Meeting on June 20th, 2011, the Board has reappointed the following officers:
In addition, VersaPay-s Board of Directors has appointed David Chan as Chief Financial Officer of the Company. David has been a Charted Accountant for 16 years and has 13 years corporate finance advisory experience. In connection with David-s appointment, he was granted stock options to purchase 100,000 common shares in the capital of the Company under its share option plan. The options are exercisable at a price of $0.95 per share on or before August 29, 2016, subject to the approval of the TSX Venture Exchange.
Jeff Sheremeta, one of VersaPay-s founding partners, stepped down as Chief Investment Officer, but will continue to work with the Company in a consulting role. The Board thanked Mr. Sheremeta for continuing to serve the Company.
About VersaPay
VersaPay-s financial technology enables businesses and consumers across Canada to accept and process credit, debit and gift card transactions. As a payment services and financial technology company serving more than 2,500 Canadian businesses, VersaPay, in conjunction with its partners, provides the hardware, technology, infrastructure and support services that businesses of all types require to accept and process electronic payments from their consumers and clients.
While its core business is payment processing services, VersaPay also provides enhanced financial technology solutions such as VersaPay EMT – the Company-s proprietary Electronic Bill Presentment and Payment solution – which enables merchants and consumers to easily transact with one another.
VersaPay is headquartered in Vancouver, Canada and has operations in Toronto and Montreal. To learn more about VersaPay, visit .
Forward Looking and Other Cautionary Statements
This news release contains forward-looking statements and information that are based on the beliefs of management and reflect the Company-s current expectations. When used in this news release, the words “estimate”, “project”, “belief”, “anticipate”, “intend”, “expect”, “plan”, “predict”, “may” or “should” and the negative of these words or such variations thereon or comparable terminology, are intended to identify forward-looking statements and information. Such statements and information reflect the current view of the Company with respect to risks and uncertainties that may cause actual results to differ materially from those contemplated in those forward-looking statements and information.
By their nature, forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements, or other future events, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, risks relating to the speculative nature of the Company-s business, the Company-s formative stage of development and the Company-s financial position. Forward-looking statements are made based on management-s beliefs, estimates and opinions on the date that statements are made and the Company undertakes no obligation to update forward looking statements if these beliefs, estimates and opinions or other circumstances should change.
Investors are cautioned against attributing undue certainty to forward-looking statements. There are a number of important factors that could cause the Company-s actual results to differ materially from those indicated or implied by forward-looking statements and information. Such factors include, among others, risks related to following: the Company-s financial position and the potential need for future financings, the ability of the Company to maintain its relationship with its strategic partner for payment processing, the efforts and abilities of the senior management team, the ability of the Company to attract and retain skilled management, competition in the payment processing industry, and the Company-s ability to respond to technological change and protect its intellectual property rights.
The Company cautions that the foregoing list of material factors is not exhaustive. When relying on the Company-s forward-looking statements and information to make decisions, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. The Company has assumed a certain progression, which may not be realized. It has also assumed that the material factors referred to in the previous paragraph will not cause such forward-looking statements and information to differ materially from actual results or events. There can be no assurance that such assumptions will reflect the actual outcome of such items or factors.
THE FORWARD-LOOKING INFORMATION CONTAINED IN THIS NEWS RELEASE REPRESENTS THE EXPECTATIONS OF THE COMPANY AS OF THE DATE OF THIS NEWS RELEASE AND, ACCORDINGLY, IS SUBJECT TO CHANGE AFTER SUCH DATE. READERS SHOULD NOT PLACE UNDUE IMPORTANCE ON FORWARD-LOOKING INFORMATION AND SHOULD NOT RELY UPON THIS INFORMATION AS OF ANY OTHER DATE. WHILE THE COMPANY MAY ELECT TO, IT DOES NOT UNDERTAKE TO UPDATE THIS INFORMATION AT ANY PARTICULAR TIME EXCEPT AS REQUIRED IN ACCORDANCE WITH APPLICABLE SECURITIES LEGISLATION.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Contacts:
VersaPay Corporation
Bill McGill
CEO
1-647-258-9378
Hogan Mullally
Investor Relations
1-204-479-2516
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