For Third Consecutive Year Company Reports Record Revenues – $28 Million – and Record Transaction Processing Volume – $3.54 Billion
PayFac Processing Volumes more than Double sequentially over Third Quarter, leading to Fastest Revenue Growth Rate of Year in Fourth QuarterSAN ANTONIO, March 30, 2020 (GLOBE NEWSWIRE) — Usio, Inc: (Nasdaq:USIO), an integrated electronic payment solutions provider, today announced financial results for the fourth quarter and fiscal year 2019, which ended December 31, 2019.Louis Hoch, President and Chief Executive Officer of Usio, said, “Revenue growth accelerated to 15% in the fourth quarter compared to the fourth quarter of 2018, the highest quarterly rate of revenue growth this year, as PayFac transaction processing volumes significantly increased.  As a result of the strong fourth quarter, we reported our third consecutive year of record transaction processing volume and record revenues.  Our strategy to invest the cash flow generated by our strong ACH business into our PayFac and Prepaid growth initiatives is now beginning to provide anticipated returns, which we expect to further improve in the future.”“Headed into the new year Usio is ideally positioned to capitalize on the growing demand for comprehensive electronic payments solution that can provide users access to issuing (prepaid), acquiring and ACH payment enablement capabilities all from Usio.  We anticipate revenues to grow in the first quarter as compared to the fourth quarter of 2019.  This reflects our continued development of innovative, proprietary technology that is meeting the demand of our target market.  We also believe we are well positioned to  opportunistically capitalize on accretive acquisitions which would provide incremental growth and cash flow.  Our expectations are tempered by the COVID-19 pandemic, which has become a threat to overall economic growth worldwide.  Our first concern, of course, is for the safety of our employees as well as those of our customers, and we are implementing actions as prescribed by government health officials to provide them with the highest degree of protection and information.  The crisis is rapidly evolving and has created uncertainty.  Fortunately, Usio has limited exposure to retail (face-to-face) processing, and we are hopeful that any decrease in our processing volume precipitated by COVID-19 can be mitigated by any increases in ACH and other non-face-to-face processing volume COVID-19 may create, but we remain uncertain”Fourth Quarter 2019 Financial SummaryRevenues were $7.4 million for the fourth quarter, up 15% compared to $6.4 million in the same period last year.  The primary drivers of the revenue growth was total (legacy and PayFac combined) credit card transaction processing volume, which was up 27% over the same time period in 2018, primarily attributable to the strength of PayFac volumes, which were up 134% sequentially from the third quarter.Gross profits were $1.5 million, little changed from the same period last year.  Gross margins were 20.3% compared to 23.7% in the same period last year.  Gross margins in the quarter primarily reflect the higher proportion of total credit card transactions processed in the quarter.The operating loss for the quarter was $1.5 million compared to an operating loss of approximately $900,000 in the same period last year.  The increase in the operating loss primarily reflects an increase in investment in the resources that are fueling the rapid growth of PayFac volumes as well as innovations in our issuing platform.Adjusted EBITDA was ($596,000) compared to adjusted EBITDA of ($83,000) in the same period a year ago.Net loss for the fourth quarter of 2019 was $1.5 million, or ($0.12) per share and compared to a net loss of $876,000 or ($0.07) per share for the same period last year.More than $900 million of total dollars were processed in the fourth quarter, an increase over the same quarter a year ago.Usio continues to be in solid financial condition with $2.1million in cash and cash equivalents and no debt at December 31, 2019.Financial Results for Full Year 2019

Revenues for 2019 were $28.2 million, up 13% from $25 million for the same period last year.  Gross profit for the year ended December 31, 2019 was $5.9 million, up 5% from $5.6 million for the same period last year.  Gross margins were 21.1% for the year ended December 31, 2019 compared to 22.3% in the same period last year reflecting the increase in the proportion of revenue generated by total card processing.Operating loss for the year ended December 31, 2019 was $5.1 million compared to $3.8 million for the same period last year due to continued investments in the Prepaid and PayFac growth initiatives.  Adjusted EBITDA for the year ended December 31, 2019 was a loss of $1.7 million compared to a loss of $647,000 for the same period in the prior year.  Net loss for the year ended December 31, 2019 was $5.1 million or ($0.39) per share compared to a net loss of $3.8 million or ($0.31) per share in the same period last year.Conference Call and WebcastUsio, Inc.’s management will host a conference call with a live webcast today at 5:00 pm Eastern time to provide a business update.  To listen to the conference call, interested parties within the U.S. should call +1-844-883-3890.  International callers should call + 1-412-317-9246.  All callers should ask for the Usio conference call.  The conference call will also be available through a live webcast, which can be accessed via the company’s website at www.usio.com/invest.A replay of the call will be available approximately one hour after the end of the call through April 13, 2020.  The replay can be accessed via the Company’s website or by dialing +1-877-344-7529 (U.S.) or 1-412-317-0088 (international).  The replay conference playback code is 10140711. 

About Usio, Inc.Usio, Inc. (Nasdaq: USIO), a leading integrated payment solutions provider, offers a wide range of payment solutions to merchants, billers, banks, service bureaus, and card issuers. The Company operates credit, debit/prepaid, and ACH payment processing platforms to deliver convenient, world-class payment solutions and services to their clients. The strength of the Company lies in its ability to provide tailored solutions for card issuance, payment acceptance, and bill payments as well as its unique technology in the prepaid sector. Usio is headquartered in San Antonio, Texas, and has offices in Austin, Texas and Franklin, Tennessee, just outside of Nashville.About Non-GAAP Financial Measures
This press release includes non-GAAP financial measures, EBITDA and adjusted EBITDA, as defined in Regulation G of the Securities and Exchange Act of 1934, as amended. The Company reports its financial results in compliance with GAAP, but believes that also discussing non-GAAP measures provides investors with financial measures it uses in the management of its business. The Company defines EBITDA as operating income (loss), before interest, taxes, depreciation and amortization of intangibles. The Company defines adjusted EBITDA as EBITDA, as defined above, plus non-cash stock option costs and certain non-recurring items, such as acquisitions. These measures may not be comparable to similarly titled measures reported by other companies. Management uses EBITDA and adjusted EBITDA as indicators of the Company’s operating performance and ability to fund acquisitions, capital expenditures and other investments and, in the absence of refinancing options, to repay debt obligations.Management believes EBITDA and adjusted EBITDA are helpful to investors in evaluating the Company’s operating performance because non-cash costs and other items that management believes are not indicative of its results of operations are excluded. EBITDA and adjusted EBITDA are supplemental non-GAAP measures, which have limitations as an analytical tool. Non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. Non-GAAP financial measures do not reflect a comprehensive system of accounting, may differ from GAAP measures with the same names, and may differ from non-GAAP financial measures with the same or similar names that are used by other companies. For a description of our use of EBITDA and adjusted EBITDA, and a reconciliation of EBITDA and adjusted EBITDA to operating income (loss), see the section of this press release titled “Non-GAAP Reconciliation.”FORWARD-LOOKING STATEMENTS DISCLAIMER
Except for the historical information contained herein, the matters discussed in this release include forward-looking statements which are covered by safe harbors. Those statements include, but may not be limited to, all statements regarding management’s intent, belief and expectations, such as statements concerning our future and our operating and growth strategy. These forward-looking statements are identified by the use of words such as “believe,” “intend,” “look forward,” “anticipate,” “schedule,” and “expect” among others. Forward-looking statements in this press release are subject to certain risks and uncertainties inherent in the Company’s business that could cause actual results to vary, including such risks related to an economic downturn as a result of the COVID-19 pandemic, the management of the Company’s growth, the loss of key resellers, the relationships with the Automated Clearinghouse network, bank sponsors, third-party card processing providers and merchants, the security of our software, hardware and information, the volatility of the stock price, the need to obtain additional financing, risks associated with new tax legislation, and compliance with complex federal, state and local laws and regulations, and other risks detailed from time to time in the Company’s filings with the Securities and Exchange Commission including its annual report on Form 10-K for the fiscal year ended December 31, 2019. One or more of these factors have affected, and in the future, could affect the Company’s businesses and financial results in the future and could cause actual results to differ materially from plans and projections. The Company believes that the assumptions underlying the forward-looking statements included in this release will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by us or any other person that the objectives and plans will be achieved. All forward-looking statements made in this release are based on information presently available to management. The Company assumes no obligation to update any forward-looking statements, except as required by law.Contact:
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