Cardtronics Reports Q4 And Yearend Profit, Reversing Losses.(News)(Financial report)

Byline: Frederick Lowe

Cardtronics Inc. Thursday reported fourth-quarter and yearend profits as cash withdrawals increased per ATM, suggesting consumers kept credit cards in their wallets and relied instead on using debit cards and cash, according to an executive at the Houston-based ATM independent sales organization.

Cardtronics reported net income of $1.5 million for the three-month period ended Dec. 31; it reported a $58.4 million net loss during the same period a year earlier. Revenue totaled $122 million, up 7% from $114 million.

For the full year, Cardtronics reported $5.2 million in net income; it reported a net loss $71.4 million in 2008. Revenue totaled $483.1 million, up 1.5% from $475.8 million.

At the end of 2009, Cardtronics operated 33,156 ATMs in the United States, United Kingdom and Mexico compared with 33,064 a year earlier.

During the fourth quarter, cardholders withdrew $61.2 million from Cardtronics ATMs, up 6.3% from $57.6 million during the same period a year earlier, Rick Updyke, president of global development, told analysts. Monthly cash withdrawals per machine averaged $615, up 7.7% from $571.

Cardtronics reported $244.4 million in cash withdrawals for the whole year, up 7% from $228.3 million in 2008. Monthly cash withdrawals per machine in 2009 averaged $616, up 6.3% from $579 the previous year.

Cardtronics is benefiting from the greater use of cash, payroll cards, general-purpose prepaid cards and electronic benefits transfer cards, Updyke said. "The cards have brought us new customers who don't have bank accounts," he said. "There is a shift from credit cards to debit cards and cash."

However, it is difficult to quantify how much prepaid cards boosted Cardtronics' ATM withdrawals, said J. Christopher Brewster, Cardtronics chief financial officer. "I will tell you what I know and what I don't know," Brewster said. "Allpoint, our surcharge-free ATM network, signed agreements with banks, enabling cardholders to use their cards. But I don't know about cardholders, not affiliated with any bank, walking into a store and withdrawing cash from one of our ATMs."

But the growing use of cards at Cardtronics ATMs is on an "upward sloping line," he said.

During the quarter, Cardtronics launched a managed-services business in which it will manage companies' ATMs and process transactions. The American Airlines Center in Dallas and Carnival Cruise Lines are Cardtronics first two clients. The company is discussing managed ATM services with other, undisclosed banks and retailers, Updyke said.

Snowstorms blanketed much of the Mid-Atlantic States this month, and the inclement weather will affect first-quarter ATM withdrawals, he noted. "Many retailers closed, and ones that remained open had very little foot traffic," Updyke said.