What's happened at Catuity?
The loyalty, gift card and POS provider Catuity Inc. has published a shareholder update covering recent developments, including comments on the progress of its turnaround strategy and acquisition of Loyalty Magic.
The shareholder update explains several key events in the company's development since the end of June 2005, including:
- CertifiChecks launch The Company is preparing to deploy its new CALS solution on the VeriFone Omni 3750 at a 15-store chain in the Midwest USA as the first CertifiChecks client to use the new system. In doing so, Ohio-based CertifiChecks became the first US Company to deploy the new loyalty and gift card system and offer it to its base of merchants and chains.
- Lipman terminals Catuity has recently signed a letter of intent with Equity Commerce, a growing reseller of payment processing solutions, to deploy CALS on the Lipman terminal platform. The Company expects to complete development of its application for that terminal in October 2005. This, the company says, is important because a number of Catuity's key prospects have already indicated a preference for using this terminal platform.
- KESM contract renewal Catuity is currently negotiating a contract renewal with KESM Transaction Solutions, a Toronto-based payments and loyalty processor. The company has indicated that it will renew its contract through to at least 2008. KESM supports clients ranging from a leading Canadian petrol chain retailer to individual merchants and resellers.
- Loyalty Magic Loyalty Magic - which Catuity is in the process of acquiring - has signed an agreement with lifestyle retailer Billabong to deploy a gift card solution in the past quarter. "We continue to see growing demand for gift card at a wide range of retailers, from household names like Billabong to the corner merchant,'' said Chris Leach, CEO for Loyalty Magic. "We see gift card deployments as an important part of our strategy in 2006 and beyond". On July 19th 2005, Catuity's shareholders approved the company's planned acquisition of Melbourne-based Loyalty Magic.
- Nasdaq de-listing appeal On August 11tth, the company's management presented their appeal of a delisting notice to the Nasdaq Listing Qualifications Panel in Washington, DC. Catuity asked Nasdaq for a time extension to allow it to complete its plan to regain and demonstrate compliance with the listing requirements. The company is hopeful that it will be granted the necessary extension.
- Sky City license Loyalty Magic has also agreed terms with its existing client Sky City to sell the casino operator a source code license for a six-figure fee that it expects to book in the third quarter. The sale is expected to make Loyalty Magic profitable in the second half of 2005.
According to John Racine, Catuity's president and CEO, "While the focus of many of our statements has concerned significant strategic events, it is important to know that we remain focused on running our business day-to-day. No single event will drive our strategy. We are beginning to see some results from our new sales focus in the US and adoption of our new hosted solution, while our non-recurring investments in development remain low."