Sign in

You're signed outSign in or to get full access.

RP

REGO PAYMENT ARCHITECTURES, INC. (RPMT)·Q4 2014 Earnings Summary

Executive Summary

  • Q4 2014 was operationally notable (Oink Discover prepaid card launched in December; merchant footprint expanded) but lacked a traditional earnings release/call; results must be inferred from the FY 2014 10-K and prior 10-Qs .
  • Revenue was immaterial for most of 2014; Q4 revenue rose to ~$3.29k as affiliate and card initiatives began, but the business remained far from scale (FY 2014 revenue $5.71k) .
  • Liquidity and going‑concern remain key risks; management disclosed substantial doubt about continuing as a going concern and subsequently raised $2.0M via secured convertible notes in March 2015 .
  • Strategic alternatives were initiated in December 2014, and the company highlighted partnerships (e.g., Rodney “Darkchild” Jerkins) to drive youth engagement; these are potential catalysts if they translate into volume and monetization .

What Went Well and What Went Wrong

  • What Went Well

    • Launched the Oink Discover reloadable prepaid card in December 2014, enabling in‑store acceptance at ~7 million US locations and expanding beyond online-only use .
    • Broadened merchant ecosystem and consumer engagement strategy; management cited expansion into Facebook and gaming sites and a music/digital goods collaboration effort with Rodney Jerkins to build an entertainment‑centric rewards program. “Everyone at Oink is excited to be working with Rodney (Darkchild) Jerkins… the connection of music with our audience is far‑reaching and significant.” — Dr. Jo Webber, CEO .
    • Initial affiliate revenue channel established and >200 US affiliate merchant agreements in place as of 2H14, setting a foundation for offer-led monetization .

  • What Went Wrong

    • Revenue remained de minimis (FY 2014: $5.71k), underscoring slow commercialization and lack of scale despite user and merchant footprint expansion .
    • Persistent losses and cash burn drove going‑concern warnings; auditors flagged substantial doubt about the company’s ability to continue as a going concern .
    • Heightened headline risk: the Board authorized exploration of strategic alternatives (Dec 8, 2014) and the SEC issued a subpoena in Sept 2014 regarding trading in the company’s stock (company cooperating) .

Financial Results

  • No standalone Q4’14 press release or call transcript was available. Q4 figures are derived from FY 2014 10-K and Q3 2014 10-Q.
MetricQ2 2014Q3 2014Q4 2014
Revenue ($USD)$1,253 $736 $3,294 (derived: FY $5,708 − 9M $2,414)
Net Income (Loss) ($USD)$(1,873,143) $(2,957,832) $941,594 (derived: FY $(9,654,838) − 9M $(10,596,432))
Net Income Margin %(149,447%) (calc: −1,873,143 / 1,253) (401,879%) (calc: −2,957,832 / 736) 28,585% (calc: 941,594 / 3,294)
Basic & Diluted EPS ($)$(0.05) $(0.03) N/A (Company did not disclose quarterly EPS; FY EPS $(0.14))

Notes:

  • Q4 revenue and net income figures are computed from filed totals and prior periods; margins are not meaningful given immaterial revenue and large non‑cash items (e.g., embedded derivative fair‑value changes) .

Segment and KPIs (company reports one segment):

  • Users: “over 1 million system users” (registered accounts active in past 12 months) .
  • Affiliate merchants: >200 in the US by late 2014 .
  • Card acceptance: Discover-backed Oink card accepted at ~7 million US locations .

Guidance Changes

  • The company did not provide numerical guidance; management commentary pointed to expected 2015 revenue contributions from affiliate offers, partner referrals, and the Oink prepaid card .
MetricPeriodPrevious GuidanceCurrent GuidanceChange
RevenueFY/Q1 2015+NoneQualitative: expect incremental contribution from card, affiliate, partner referralsN/A
Margins/OpEx/Tax/OtherN/ANoneNoneN/A

Earnings Call Themes & Trends

No Q4’14 earnings call transcript was located. Themes below reflect disclosures across Q2–Q4 filings and 2/9/2015 corporate update.

TopicPrevious Mentions (Q2 & Q3 2014)Current Period (Q4 2014)Trend
Product/Tech rolloutBuilding mobile apps; integration with gaming and retail; affiliate offers seeded Oink Discover prepaid card launched Dec 2014; broader in‑store footprint Improving execution
Merchant ecosystem>20 channel partners; integrations across US/EU; >200 affiliate merchants Additional digital goods/retail integrations highlighted (incl. Facebook, gaming) Expanding
Monetization mixTransactional fees; early affiliate revenue; referral fees starting in late Q3 Card fees begin (annual/user fees; Discover network fees) Diversifying
Regulatory/legalCOPPA‑compliant positioning; SEC subpoena (Sept 2014) with cooperation Ongoing compliance; no new disclosures beyond subpoena cooperation Stable risk mgmt
Liquidity/capitalOngoing cash burn; need for additional financing; going‑concern disclosure Strategic alternatives initiated; $2.0M secured convertible notes raised Mar 2015 Mixed (risk + funding)

Management Commentary

  • “In the second half of 2014, Oink greatly increased its network of digital goods and retail merchants… integrated with Facebook, Wargaming, Fantage… signed an agreement with Grammy‑winning producer Rodney Jerkins… build a rewards program… unique access to music and events.”
  • “Oink‑branded Discover prepaid card… accepted in more than 7 million locations… In its first four weeks, Oink saw a rapid increase in the number of transactions… Top spending categories… food, apparel, and entertainment.”
  • “We have not generated significant revenue since our inception… expect growth in user base and engagement… with several major digital goods providers and offers functionality… affiliate agreements with over 200 merchants.”

Q&A Highlights

  • No earnings call or transcript was available for Q4 2014. Key disclosures were provided via the 10‑K, 10‑Qs, and 8‑Ks; no call‑based Q&A or guidance clarifications to summarize .

Estimates Context

  • Wall Street consensus EPS and revenue estimates for Q4 2014 were not available via S&P Global at time of query (rate limit). Given limited analyst coverage and micro‑cap status, formal consensus may not exist. Attempts to retrieve S&P Global estimates returned an access limit error (Primary EPS Consensus Mean; Revenue Consensus Mean) for Q4 2014. Estimates unavailable.

Key Takeaways for Investors

  • Path to monetization now includes card, affiliate, and referral streams; operational groundwork is laid, but scale is unproven and revenue remains immaterial as of FY 2014 .
  • Liquidity is the gating factor; management signaled going‑concern risk and continues to finance via dilutive/convertible structures (e.g., $2.0M 10% secured converts, Mar 2015) while exploring strategic alternatives .
  • The Oink Discover card materially expands addressable acceptance (online + in‑store); watch for active cards, spend per card, and retention KPIs to validate product‑market fit .
  • Merchant and influencer initiatives (e.g., Facebook/gaming integrations, Rodney Jerkins rewards) could accelerate youth engagement; hard KPIs (MAUs, transaction volume, affiliate conversion) will be the proof points .
  • Legal/compliance posture remains a monitored risk; the SEC subpoena did not allege wrongdoing, but headline risk persists until resolved .
  • Near‑term trading implications hinge on capital raises/strategic alternatives headlines; medium‑term thesis depends on converting ecosystem breadth into transaction velocity and monetization at scale .

Citations:

  • Corporate update and Q4 operational developments:
  • Strategic alternatives:
  • Q2 2014 financials:
  • Q3 2014 financials and disclosures:
  • FY 2014 results and business outlook: