Usio(US:USIO)2022-11-09 21:03Revenue Performance - Total revenue for Q3 2022 was $16.4 million, a 4% increase from $15.8 million in Q3 2021, driven by growth in PayFac and Output Solutions despite declines in Prepaid and ACH services [85]. - Credit card revenue increased by 5% to $6.8 million in Q3 2022 compared to $6.5 million in Q3 2021, while ACH and complementary service revenue decreased by 13% to $3.2 million [85]. - Revenue from Output Solutions increased by 32% to $4.7 million in Q3 2022 compared to $3.6 million in Q3 2021 [85]. - For the nine months ended September 30, 2022, total revenue increased by 14% to $50.7 million from $44.5 million in the same period in 2021 [86]. Operational Metrics - Total dollar volumes processed across all business lines in Q3 2022 were $2.4 billion, down from $2.7 billion in Q3 2021, primarily due to decreased cryptocurrency activity and the winding down of COVID-19 government assistance programs [75]. - Prepaid card load volumes decreased by 41% in Q3 2022 compared to Q3 2021, while prepaid card transaction counts increased by 5% [74]. - ACH transaction counts decreased by 4% in Q3 2022 compared to Q3 2021, with returned check transactions increasing by 72% [73]. Financial Losses and Costs - Adjusted EBITDA loss for Q3 2022 was $0.5 million, compared to an adjusted EBITDA of $1.2 million in Q3 2021, attributed to increased SG&A and reduced profit margins [81]. - Cost of services increased by $1.5 million, or 13%, to $13.3 million for the quarter ended September 30, 2022, compared to $11.8 million for the same period in the prior year [88]. - Gross profits decreased by 22% to $3.1 million for the quarter ended September 30, 2022, with a gross margin percentage of 19.1%, down from 25.5% in the prior year [91]. - Stock-based compensation expenses rose by 50.2% to $0.5 million for the quarter ended September 30, 2022, compared to $0.3 million for the same period in the prior year [93]. - Other selling, general and administrative expenses increased by 29% to $3.7 million for the quarter ended September 30, 2022, reflecting continued investments in various business lines [95]. - The company reported a net loss of $1.8 million for the quarter ended September 30, 2022, compared to a net income of $0.1 million for the same period in the prior year [102]. Cash Flow and Financial Position - Cash used in operations was $22.8 million for the nine months ended September 30, 2022, compared to cash provided by operations of $8.7 million for the same period in the prior year [107]. - Net cash used by financing activities increased to $935,513 for the nine months ended September 30, 2022, compared to $58,800 for the same period in the prior year, due to the stock buyback program [109]. - The company had cash and cash equivalents of $4.6 million as of September 30, 2022 [105]. - Accumulated deficit reached $70.7 million as of September 30, 2022 [106]. - Depreciation and amortization totaled $2.2 million for the nine months ended September 30, 2022, compared to $1.9 million for the same period in the prior year [99]. Strategic Initiatives - The company aims to grow revenues by expanding its ACH merchants and adding new software integrators while optimizing its infrastructure to expand payment processing capabilities without significantly increasing operating costs [71]. - The company has established long-standing relationships with premier banking institutions, enhancing its service offerings and customer base [68].