Planet Payment spins back into profit

Payments processing firm Planet Payment(LON:PPT, NASDAQ:PLPM) returned to profitability in the first quarter, while consolidated gross billings continued to charge higher.

Consolidated gross billings increased 8% to US$32.5 million compared to US$30.2 million in the first quarter of 2012.

Consolidated gross billings is regarded by management as one of the key performance indicators for the group, along with the total number of active merchant locations and the total settled dollar volume processed, both of which also improved year-on-year.

Total active merchants jumped by 35% from a year earlier to around 42,000 while the total settled dollar volume processed surged 19% to US$1.7bn.

Adjusted underlying earnings (EBITDA) totalled US$1.4mln from US$1.7mln in the corresponding quarter of 2012. Pre-tax profit was US$372,509, versus US$882,419 a year earlier.

Net revenue improved to US$12.1mln from US$11.7mln in the first quarter of 2012.

Net revenue for the current fiscal year is expected to fall somewhere in the range of US$52.2mln to US$55.0mln, while adjusted EBITDA is expected to be between US$8.3mln and US$10.6mln.

“We are pleased with our results in the first quarter in particular with the return to profitability,” said Philip Beck, chairman and chief executive officer of Planet Payment.

The company slipped into the red last year after blowing US$2.6mln on a listing on the technology-focused NASDAQ exchange that it chose to postpone because of timing issues; the company subsequently listed on NASDAQ just before Christmas last year, since when the shares have been on a decent run.

While making money is always good, signing up new partners is key to the company’s strategy.

“We are building on the strong relationships we have with our acquiring bank and processor customers around the world. Further growth will be driven through a continued focus on existing customers, adding new customers in existing and new markets, and by providing our customers and their merchants with new products and services," Beck said.

"We remain excited by the opportunities in emerging markets such as Brazil, Mexico and Indonesia and expect to be able to report further developments in these markets, as well as those in which we already have an established presence, as the year progresses," he added.

Shares in Planet Payment were up 8.5p in the first 15 minutes of trading to 200p; that’s around $3.10 in the US currency.