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LML Payment Systems Inc. Reports Operating Results (10-Q)

August 14, 2012 | About:
10qk

10qk

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LML Payment Systems Inc. (LMLP) filed Quarterly Report for the period ended 2012-06-30.

Lml Payment Systems, Inc. has a market cap of $61.9 million; its shares were traded at around $2.18 with a P/E ratio of 9.5 and P/S ratio of 1.8.

Highlight of Business Operations:

The decrease is total revenue for the three months ended June 30, 2012 is primarily attributable to the decrease in our non-recurring IPL segment revenue of approximately $1,250,000 offset by an increase in our TPP segment revenue of approximately $942,000.

Revenue pertaining to our TPP segment consists of transaction fees, one-time set-up fees, monthly fees including gateway fees and software customization fees. Total revenue from our TPP segment increased by approximately $942,000, or approximately 25.6%. Transaction fees for the three months ended June 30, 2012 increased by approximately $866,000 or approximately 29.6%; the amortized portion of one-time setup fees recognized increased approximately $10,000 or approximately 18.2%; monthly fees including gateway fees for the three months ended June 30, 2012 increased approximately $141,000 or approximately 28.8% while software customization fees decreased approximately $116,000 or approximately 86.6%. The increase in transaction fees, one-time set-up fees and monthly fees including gateway fees was primarily attributable to a 26.8% increase in our merchant base as at June 30, 2012 as compared to June 30, 2011.

Revenue from licensing our patented intellectual property decreased by approximately $1,257,000 or approximately 74.8% primarily due to the recognition of approximately $1,250,000 in non-recurring revenue from a license agreement entered into during the three months ended June 30, 2011.

Costs of revenue decreased for the three months ended June 30, 2012 by approximately $71,000 or approximately 2.1%. This decrease was primarily attributable to a decrease of approximately $683,000 in IPL segment cost of revenue offset by an increase in TPP segment cost of revenue of approximately $663,000. The decrease in IPL segment costs was primarily due to a decrease of approximately $610,000 in the costs (primarily legal costs) incurred in connection with a license agreement entered into during the three months ended June 30, 2011. The increase in TPP segment costs was primarily attributable to an increase of approximately 35.6% in our transaction costs which include interchange, assessments and other transaction fees which coincided with increased transaction processing revenue. CP segment cost of revenue decreased approximately $65,000 or approximately 16.5% which coincided with the decrease in CP segment revenue for the three months ended June 30, 2012.

Sales and marketing expenses decreased to approximately $251,000 from approximately $308,000 for the three months ended June 30, 2012 and 2011, respectively, a decrease of approximately $57,000 or approximately 18.5%. The decrease is primarily attributable to a decrease in TPP segment sales and marketing expenses of approximately $52,000 or approximately 26.3% from approximately $198,000 for the three months ended June 30, 2011 to approximately $146,000 for the three months ended June 30, 2012. The decrease in TPP segment sales and marketing expenses is primarily attributable to a decrease in wages and commissions of approximately $33,000, resulting from lower compensation costs for the three months ended June 30, 2012 as compared to the three months ended June 30, 2011. Amortization expense for partner relationships and merchant contracts were approximately $97,000 for the three months ended June 30, 2012 and 2011 respectively.

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