PONTE VEDRA, Fla. - Independent ATM solutions provider Global Axcess Corp. announced that it is changing its financial guidance for the year.
The company expects year-end revenue of approximately $19.5 million in 2005, a 40 percent increase from 2004. But in a filing with the Securities and Exchange Commission, Global Axcess made a revenue correction for the third and second quarters of the year, ending Sept. 30, 2005, and June 30, 2005, of $241,439 and $425,669, respectively. (Read also, Global Axcess revenue jumps, net income drops in 3Q.) The adjustment will reduce net income by $500,000, or 2 cents per share, for those two quarters.
According to a news release, the revenue-reporting error relates to accounting for costs associated with purchased software and development costs that weren't capitalized. Now Global Axcess said it expects revenue from continuing operations to decrease 21 percent, from $900,000 in '04 to $700,000 in '05. For 2005, net income is expected to be between $100,000, down from $1.1 million in '04.
"We are confident that this revised accounting approach and the operating changes we made in the latter part of 2005, such as the outsourcing of processing services and the sale of a non-profitable subsidiary, will show positive results for 2006 and beyond," said Michael Dodak, GAXC's chairman and chief executive. "We believe that Global Axcess will continue to generate earnings and positive cash flows from continuing operations, while changing to a positive current ratio in 2005. We still intend on having a year-end conference call in April to discuss 2005 financial results."
