JACKSONVILLE, Fla. - For the third consecutive quarter, Global Axcess Corp. has showed consistent financial improvement.
Earlier this week, the company announced that its revenue and profit for the second quarter had improved from 2006, with revenue hitting $5.6 million and net income coming in at $170,900, 1 cent per share. In Q2 2006, GAXC reported revenue of $5.5 million and a net loss of $373,100, a negative 2 cents per share.
In May, GAXC announced first-quarter revenue of $5.3 million, up 1.4 percent from 1Q '06. The company's net income came in at approximately $101,000, a substantial improvement from the $878,000 net loss reported in 1Q '06.
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And in April, Global Axcess reported a 4.5 percent revenue increase from the fourth quarter of 2005 to 4Q '06. Net income during that quarter came in at $14,076, up approximately $785,000 from 4Q '05.
Despite increases in ATM service rates, fuel charges and insurance premiums, the company still showed financial improvement during this most-recent quarter.
Turning it around
GAXC's financial improvement has been no small feat, although George McQuain, GAXC's president and chief executive, is humble in his explanation of the change.
"It's pretty basic," he said. "You decide on the strategy for the company, you build a culture for the company so the employees know the playbook - so they know how to run the plays - and then you take down the barriers so people can focus on the right things."
Nevertheless, for a company that last year was toying with the idea of selling, GAXC is one independent sales organization that has reorganized for the better.
In November, McQuain told ATM Marketplace that he expected 2007 to be a turnaround year - one during which Global Axcess could re-invent its image.
"In a fragmented industry, lacking strategic discipline or overreaction to new products is a dangerous thing," he said. "We've grown pretty rapidly, and we weren't always smart. I don't think the growth hurt us, per se; but not being smart about it and losing our focus did."
In late 2006, GAXC began cutting staff and making changes at the top, including the promotion of McQuain, who in October 2006 replaced former CEO Michael Dodak and former president David Fann.
The company also initiated a plan to focus attention on its Nationwide Money Services brand and let go of subsidiaries that were draining the bottom line.
During the third quarter of 2006, GAXC wrote off the sale of its payroll-card subsidiary, EasyGreen Cash Card, and finalized the sale of its South African subsidiary, Cash Axcess Corp. In 2005, GAXC closed its software subsidiary, Axcess Technology Corp. And in early 2006, it opted to outsource most of its ATM-transaction processing.
Too much growth and diversity have taken their toll on other ISOs in the industry, namely Portland, Ore.-based TRM Corp., which continues to report losses. To combat its downward financial spiral, TRM this month announced the hire of a new chief financial officer.
"Credibility is paramount," McQuain said.
In June, shortly after GAXC released its 1Q results, McQuain said the company has put a strong emphasis on cost cutting, ATM attrition and keeping its eyes on North America.
"We're focusing our attention on the U.S.," he said. "Every company has to have their own strategy. We may not be the biggest in the U.S., but I believe we can be the best. And I'm not sure if the diversion of learning another culture and working in another country is where we want to be. I don't know that we could be the best at that, so why attempt it right now?"
