Loading...
Loading...
Net Element, Inc.
("Net Element" or the "Company"), a provider of global mobile payment
technology solutions and value-added transactional services today presented
historical financial results for PayOnline for periods prior to our
ownership.
PayOnline acquisition creates a unique platform for further consolidation
and positions the Company to lead in the fragmented and growing emerging
market payments industry.
Acquisition of PayOnline
As previously reported, on May 20, 2015, Net Element entered into a
definitive agreement with PayOnline pursuant to which Net Element is to
acquire PayOnline for up to $8.4 million in total consideration. The closing
payment is $3.6 million cash, which has been paid into escrow and $3.6
million in Net Element stock. There is the potential for additional
consideration of up to $1.282 million in cash and stock from earn-out
incentives based on performance.
Net Element assumed operational and financial control of PayOnline and its
subsidiaries as of May 20, 2015, and will consolidate PayOnline results in
the second quarter from May 20, 2015 to June 30, 2015.
PayOnline processes online payments for over 10 million active consumers and
thousands of merchants in the Russian Federation, Europe and Asia.
The 2014 McKinsey Global Payments Map released October 2014, states Russia
is the world's 6th largest payments market, accounting for $50 billion in
payments with a rapidly growing online population. They state that Card
issuance is growing at 30% per year.
Net Element plans to integrate PayOnline's payments platform into its
existing global payments-as-a-service network to expand its transaction
processing offerings.
Upon integration, Net Element global merchants will have access to a broad
array of value-added services including card2card transfer, payment split
and the highest level of data security (Validated Level 1 PCI DSS
Compliance).
Recent Events:
-- On July 28, 2015, PayOnline released an updated solution for the travel
industry. PayOnline's Pay-Travel product provides an industry solution
to
automated payments for the travel industry including integration with
GDS;
-- On June 29, 2015, PayOnline announced signing of a 3-year contract to
process transactions for certain international dating networks,
including
AnastasiaDate, AmoLatina and AsianDate. The contract provides for a
minimum processing commitment of $300 million in transactions over 3
years and minimum net revenues to PayOnline in the amount of $1.2
million
over contract period;
-- On June 4, 2015, PayOnline launched payment processing in Kazakhstan by
integrating with Kazkommertsbank ("KAZKOM"), Kazakhstan's largest bank
and signed with Kassir.com, the country's largest online events
ticketing
website and one of the largest online merchants serving in the
Kazakhstan
market.
NET ELEMENT, INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT
OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
FOR THE THREE MONTHS ENDED MARCH 31, 2015
Net
Element, Pro Forma
Pro Forma
Inc. PayOnline Adj
Consolidated
----------- ---------- ----------
---------------
Net revenues $ 5,540,207 $1,202,878 $ - $
6,743,085
Costs and operating
expenses:
Cost of revenues 4,614,072 802,092 -
5,416,164
General and
administrative
(includes $601,371
and $52,050 of share
based compensation
for the three months
ended March 31, 2015
and 2014 2,637,469
respectively) 307,675 -
2,945,144
Provision for bad
debts 9,331 - -
9,331
Depreciation and
amortization 438,769 18,637 494,331 (j)
951,737
---------- --------- ---------
-----------
Total costs and
operating expenses 7,699,641 1,128,404 494,331
9,322,376
---------- --------- ---------
-----------
Income (loss) from
operations (2,159,434) 74,474 (494,331)
(2,579,291)
Interest expense, net (117,594) - -
(117,594)
Other income
(expense) 29,073 - -
29,073
---------- --------- ---------
-----------
Net income (loss)
before income taxes (2,247,955) 74,474 (494,331)
(2,667,812)
Income taxes - - -
-
---------- --------- ---------
-----------
Net income (loss) (2,247,955) 74,474 (494,331)
(2,667,812)
Net loss attributable
to the noncontrolling
interest 8,747 - -
8,747
---------- --------- ---------
-----------
Net income (loss)
attributable to Net
Element, Inc.
shareholders (2,239,208) 74,474 (494,331)
(2,659,065)
Foreign currency
translation (108,167) -
(108,167)
---------- --------- ---------
-----------
Comprehensive income
(loss) $(2,347,375) $ 74,474 $ (494,331) $
(2,767,232)
========== ========= =========
===========
Loss per share - basic
and diluted $ (0.05) $
(0.05)
==========
===========
Weighted average
number of common
shares outstanding -
basic and diluted 46,057,972 2,503,781 (i)(k)
48,561,754
---------- ---------
-----------
Description
(i) Represents $3.6 million in common shares priced as
if issued January 1, 2014.
(j) Represents amortization of capitalized intangible
assets from PayOnline acquisition.
(k) Represents the 2014 conversion of preferred shares
(sold to purchase PayOnline) to common shares.
NET ELEMENT, INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT
OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2014
Net Element, Pro Forma
Pro Forma
Inc. PayOnline Adj
Consolidated
------------ ---------- -----------
------------
Net revenues $ 21,194,461 $6,729,228 $ - $
27,923,689
Costs and expenses:
Cost of revenues 15,883,681 4,595,623 -
20,479,304
General and
administrative
(includes $4,267,334
of share based
compensation for the
twelve months ended 11,353,244
13,331,983
December 31, 2014) 1,619,259 359,480 (e)
Recovery of provision
for loan losses (1,153,147) - -
(1,153,147)
Depreciation and
amortization 2,358,136 85,826 1,977,325 (g)
4,421,287
----------- --------- ----------
-----------
Total costs and
operating expenses 28,441,914 6,300,708 2,336,805
37,079,427
----------- --------- ----------
-----------
Income (Loss) from
operations (7,247,453) 428,520 (2,336,805)
(9,155,738)
Interest expense, net (3,705,694) - -
(3,705,694)
Gain on change in fair
value and settlement
of beneficial
conversion
derivative 5,569,158 - 478,261 (d)
6,047,419
Loss on debt
extinguishment (6,184,219) - -
(6,184,219)
Gain on debt
restructure 1,596,000 - -
1,596,000
Loss from asset
disposal (87,151) - -
(87,151)
Other expense (155,407) - -
(155,407)
----------- --------- ----------
-----------
Income (Loss) from
continuing operations
before income taxes (10,214,766) 428,520 (1,858,544)
(11,644,790)
Income taxes - - -
-
----------- --------- ----------
-----------
Income (Loss) from
continuing operations (10,214,766) 428,520 (1,858,544)
(11,644,790)
Net loss attributable
to the noncontrolling
interest 29,250 - -
29,250
----------- --------- ----------
-----------
Net income (loss) from
continuing operations
attributable to Net
Loading...
Loading...
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Posted In: NewsPress Releases
Benzinga simplifies the market for smarter investing
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
Join Now: Free!
Already a member?Sign in