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Global Axcess Corp Announces Fourth Quarter 2007 and Fiscal Year 2007 Financial Results
Feb 20, 2008 (08:02 AM EST)


JACKSONVILLE, Fla., Feb. 20 /PRNewswire-FirstCall/ -- Global Axcess Corp (the "Company"), an independent provider of ATM solutions, today announced the financial results for the fourth quarter and fiscal year ended December 31, 2007.

The Company reported revenues from continuing operations of approximately $5.4 million for the fourth quarter ended December 31, 2007, up from the reported revenues of approximately $5.2 million for the same period of 2006. This represented an increase of approximately 2.8% year over year.

The Company recorded net income for the fourth quarter ended December 31, 2007 of approximately $62,200, which compares to net income of $14,100 for the same period of 2006. Fourth quarter 2006 net income included $146,700 of income relating to fees which had accumulated but had not been recognized as revenue, and as such, the amount was recognized as other non-operating income during the fourth quarter ended December 31, 2006. The fourth quarter of 2007 represented the fifth consecutive quarter of positive earnings since the Company announced its restructuring plan in the third quarter of 2006.

For the fiscal year ended December 31, 2007, the Company reported revenues from continuing operations of approximately $21.8 million, up from the reported revenues of approximately $21.4 million for fiscal 2006. This represented an increase of approximately 1.5% year over year.

The Company recorded net income for the fiscal year ended December 31, 2007 of approximately $430,500, which compares to a net loss of $4,864,300 for fiscal 2006. Net income per diluted share for fiscal 2007 was $.02 on a share count of 20,988,348 versus a net loss per diluted share of $.23 on a share count of 20,996,013 for fiscal 2006.

The Company achieved gross profit from continuing operations of approximately $2.3 million or 42.2% of revenue for the three-month period ended December 31, 2007. This compared to $2.0 million or 39.1% of revenue for the same period of 2006.

SG&A expenses from continuing operations were approximately $1.3 million, or 23.7% of revenue for the fourth quarter 2007 versus $1.3 million, or 25.4% of revenue for the same period in 2006.

Depreciation and amortization expense increased by approximately $44,200 to $578,800 for the three-month period ended December 31, 2007 as compared to $534,600 for the same period in 2006.

During the fourth quarter of 2007, the Company recorded interest expense of approximately $309,400. This is compared to interest expense of approximately $316,700 for the same period in 2006. Included in the fourth quarter 2007 interest expense was $32,500 of non-cash expense relating to the interest swap agreement the Company entered into with its senior lender in October 2005.

For the fiscal year 2007, SG&A expenses from continuing operations were approximately $5.3 million, or 24.3% of revenue versus $6.8 million, or 31.9% of revenue for fiscal 2006.

The Company's EBITDA (earnings before net interest, taxes, depreciation and amortization) increased to $3,925,700 for fiscal 2007 from negative $1,148,500 for fiscal 2006. EBITDA as a percentage of revenues increased to 18.0% for fiscal 2007 from negative 5.4% for fiscal 2006.

EBITDA represents a non-GAAP (Generally Accepted Accounting Principles) financial measure. A table reconciling this measure to the appropriate GAAP measure is included in this release.

Michael J. Loiacono, Chief Financial Officer of the Company, stated, "During 2007 we continued to adjust our cost structure associated with the restructuring efforts which began in the third quarter of 2006. The fourth quarter of 2007 and fiscal 2007 both exemplified these efforts as we saw decreases in SG&A expenses, both in dollars and in percentages of revenue, from the same periods last year. I am pleased to see that we were able to execute our cost reduction plans designed to stabilize our financials and return us to profitability. I believe this improvement reflects our commitment to profitability and our commitment to aggressively and continually review our cost structure and to adjust wherever possible."

Mr. George McQuain, Chief Executive Officer of Global Axcess, stated, "We are very pleased to have produced five quarters of profitability in a row and a profitable 2007. Additionally, we successfully completed the network mandated Triple-DES project and the U.S. Patriot Act mandated background check project. With the completion of these two projects, we can now free up our sales and account management staffs to drive revenue growth.

On the whole our team has done a very good job across many fronts and we believe our 2007 net income and 2007 record EBITDA bear that out. Our staff remains focused and dedicated to making Global Axcess Corp the best company in the U.S. ATM services industry. We continue to be very excited with our progress."

Conference Call Information The conference call will be announced within the next seven days.

About Global Axcess Corp

Headquartered in Jacksonville, Florida, Global Axcess Corp was founded in 2001 with a mission to emerge as the leading independent provider of ATM services in the United States. Through its wholly owned subsidiary, Nationwide Money Services, Inc. (NMS), the Company provides turnkey ATM management solutions that include cash, project and account management services. NMS currently owns and operates 4,335 ATMs in its national network spanning 44 states. For more information on the Company, please visit http://www.globalaxcess.biz.

Investors Sharon Jackson, 904-395-1149 Sharon.Jackson@GLXS.biz

This press release may contain forward-looking statements. Such forward- looking statements may be identified by, among other things, the use of forward-looking terminology such as: "believes," "expects," "may," "will," "should" or "anticipates," or the negative thereof or other variations thereon or comparable terminology, or by discussions of strategy that involve risks and uncertainties. Various important risks and uncertainties may cause Global Axcess' actual results to differ materially from the results indicated by these forward-looking statements. For a list and description of the risks and uncertainties the Company faces, please refer to Part I, Item 1 of the Company's Annual Report on Form 10-KSB, filed with the Securities and Exchange Commission on March 28, 2007, and other filings that have been filed with the Securities and Exchange Commission. Global Axcess assumes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise and such statements are current only as of the date they are made.

GLOBAL AXCESS CORP AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEET December 31, 2007 ASSETS Current assets Cash and cash equivalents $540,161 Accounts receivable, net of allowance for doubtful accounts of $23,797 924,629 Inventory 235,597 Prepaid expenses and other current assets 141,348 Total current assets 1,841,735 Fixed assets, net 5,580,882 Other assets Merchant contracts, net 12,057,638 Intangible assets, net 4,165,491 Deferred tax asset - non-current 339,800 Other assets 15,139 Total assets $24,000,685 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Accounts payable and accrued liabilities $3,361,635 Notes payable - related parties - current portion, net 20,695 Note payable 25,000 Senior lenders' notes payable - current portion, net 600,000 Capital lease obligations - current portion 961,046 Total current liabilities 4,968,376 Long-term liabilities Notes payable - related parties - long-term portion, net 1,317,180 Senior lenders' notes payable - long-term portion, net 4,757,377 Capital lease obligations - long-term portion 823,489 Total liabilities 11,866,422 Stockholders' equity Preferred stock; $0.001 par value; 5,000,000 shares authorized, no shares issued and outstanding - Common stock; $0.001 par value; 45,000,000 shares authorized, 21,021,786 shares issued, 20,973,924 outstanding 21,022 Additional paid-in capital 22,453,584 Accumulated deficit (10,328,377) Treasury stock; 47,862 shares of common stock at cost (11,966) Total stockholders' equity 12,134,263 Total liabilities and stockholders' equity $24,000,685 GLOBAL AXCESS CORP AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) For the Three Months Ended December 31, December 31, 2007 2006 Revenues $5,350,890 $5,204,603 Cost of revenues 3,094,869 3,170,347 Gross profit 2,256,021 2,034,256 Operating expenses Depreciation and amortization 578,822 534,587 Selling, general and administrative 1,267,586 1,322,018 Impairment of notes receivable - 4,851 Stock compensation expense 38,000 - Total operating expenses 1,884,408 1,861,456 Operating income from continuing operations before items shown below 371,613 172,800 Interest expense, net (309,434) (316,722) Gain on sale of assets - 11,295 Other non-operating income - 146,703 Net Income $62,179 $14,076 GLOBAL AXCESS CORP AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS For the Year Ended December 31, December 31, 2007 2006 Revenues $21,750,897 $21,437,125 Cost of revenues 12,705,636 12,405,270 Gross profit 9,045,261 9,031,855 Operating expenses Depreciation and amortization 2,262,551 2,359,455 Impairment of long-lived assets - 1, 329,396 Selling, general and administrative 5,279,101 6,839,003 Restructuring charges - 757,811 Impairment of notes receivable 5,743 817,607 Recovery of bad debts (100,000) - Stock compensation expense 87,181 (11,698) Other expense - 450,000 Total operating expenses 7,534,576 12,541,574 Operating income (loss) from continuing operations before items shown below 1,510,685 (3,509,719) Interest expense, net (1,232,661) (1,356,407) Gain (loss) on sale or disposal of assets (22,517) 21,672 Other non-operating income - 146,703 Loss attributed to minority interest - 109,351 Income (loss) from continuing operations $255,507 $(4,588,400) Income (loss) from discontinued operations, net of tax $175,000 $(275,937) Net Income (loss) $430,507 $(4,864,337) Income (loss) per common share - basic: Income (loss) from continuing operations $0.01 $(0.22) Income (loss) from discontinued operations $0.01 $(0.01) Net Income (loss) per common share $0.02 $(0.23) Income (loss) per common share - diluted: Income (loss) from continuing operations $0.01 $(0.22) Income (loss) from discontinued operations $0.01 $(0.01) Net Income (loss) per common share $0.02 $(0.23) Weighted average common shares outstanding: Basic 20,988,348 20,996,013 Diluted 20,988,348 20,996,013 GLOBAL AXCESS CORP AND SUBSIDIARIES EBITDA Reconciliation (Unaudited) For the Year Ended December 31, December 31, 2007 2006 Net income (loss) $430,507 $(4,864,337) Provision for income taxes - - Interest expense, net 1,232,661 1,356,407 Depreciation and amortization 2,262,551 2,359,455 EBITDA $3,925,719 $(1,148,475)

CONTACT: Investors: Sharon Jackson, Global Axcess Corp, +1-904-395-1149, Sharon.Jackson@GLXS.biz

Web site: http://www.globalaxcess.biz/