Online Resources Corporation (Nasdaq: ORCC), a leading provider of online financial services, today reported financial and operating results for the three months ended September 30, 2009.
- Revenue was $36.6 million, down 4 percent from $38.1 million in the third quarter 2008.
- Adjusted Ebitda, a non-GAAP measure, was $9.8 million, up 19 percent from $8.3 million in the prior year.
- Net income available to common stockholders was $0.4 million, or $0.01 per diluted share. This result compares to a net loss of $1.5 million, or $0.05 loss per diluted share, in 2008.
- Core net income, a non-GAAP measure, was $2.9 million, up 50 percent from $1.9 million in 2008. On a per share basis, core net income was $0.09, up 50 percent from $0.06 in 2008.
"True to our priorities, we delivered excellent earnings and cash flow growth in the third quarter, while continuing to reduce debt," said Matthew P. Lawlor, chairman and chief executive officer of the Company. "Revenue was lower than expected, however, due to weaker consumer transactions and a $0.5 million fee expected in the third quarter that was recognized early in the fourth quarter."
Lawlor continued, "Consumer adoption of online banking continued to climb nicely, and same store billpay transactions grew in line with recent quarters. New client signings were especially strong, as our fully integrated one-stop internet banking offering continues to resonate with community banks and credit unions. We also entered into two potentially large distributor partnerships. We renewed all of our expiring large client contracts but, as previously stated, we expect continued client turnover as the industry consolidates and competition intensifies."
"New client activity was also strong in our e-commerce business," Lawlor added. "We signed a major healthcare services provider for enrollment and payment services, and significantly expanded our web-based collections relationship with a top 3 U.S. card issuer. While consumer transactions continued to grow year over year, the recession has had a major impact on our accounts receivable management clients, contributing to a decline in user-paid fees."
Lawlor concluded, "Looking forward, I believe we are positioned well competitively, with our comprehensive product set and focus on the online channel. We expect to continue to grow earnings and cash flow, as we benefit from prior strategic cost initiatives. There are also some promising revenue indicators such as stepped-up client signings, new products and a possible bottoming of consumer transaction declines. However, until we see some firmer signs of an economic turnaround and stability in the markets we serve, we must assume on-going challenges to the top line."
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