<PAGE> 1
_______________________________________________________________________________
_______________________________________________________________________________
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Commission file number C00-22167
---------------
EURONET SERVICES INC.
(Exact name of the registrant as specified in its charter)
DELAWARE
(State or other jurisdiction of incorporation or organization)
74-2806888
(I.R.S. employer identification no.)
14-24 Horvat u.
1027 Budapest
Hungary
(Address of principal executive offices)
36-1-224-1000
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
YES [X] NO [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date: As at April 30, 1997,
15,257,048 Common Shares.
_______________________________________________________________________________
_______________________________________________________________________________
<PAGE> 2
PART I
ITEM 1 FINANCIAL STATEMENTS
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
<TABLE>
<CAPTION>
MARCH 31, 1997 DECEMBER 31, 1996
-------------- -----------------
(UNAUDITED) (AUDITED)
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 46,346 $ 2,541
Restricted cash 974 818
Trade accounts receivable, net 228 172
Investment securities 6,944 194
Prepaid expenses and other current assets 934 433
--------- ---------
Total current assets 55,426 4,158
Property and equipment, net 9,440 7,284
Loans receivable, excluding current portion 18 21
Deferred income taxes 597 471
--------- ---------
Total assets 65,481 11,934
========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Trade accounts payable $ 2,065 $ 1,670
Short term borrowings 182 194
Current installments of capital leases obligations 808 637
Note payable - shareholder 260 262
Accrued expenses and other current liabilities 291 98
--------- ---------
Total current liabilities 3,606 2,861
Obligations under capital leases, excluding
current installments 5,524 3,834
Other long-term liabilities 88 103
--------- ---------
Total liabilities 9,218 6,798
--------- ---------
Shareholders' equity:
Common and preferred shares, Euronet Holding N.V. -- 191
Common stock, $0.02 par value; 30,000,000 shares
authorized; 15,235,068 shares issued and outstanding 305 --
Additional paid in capital 62,994 11,666
Subscription receivable (500)
Accumulated losses (7,820) (7,005)
Restricted reserve 784 784
--------- ---------
Total shareholders' equity 56,263 5,136
--------- ---------
Total liabilities and shareholders' equity $ 65,481 $ 11,934
========= =========
</TABLE>
See accompanying notes to condensed consolidated statements.
<PAGE> 3
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
THREE MONTHS ENDED TWELVE MONTHS ENDED
------------------------------- -------------------
MARCH 31, 1997 MARCH 31, 1996 DECEMBER 31, 1996
-------------- -------------- -----------------
(UNAUDITED) (AUDITED)
<S> <C> <C> <C>
Revenue 795 100 1,261
---------- ---------- ----------
Operating expenses:
ATM operating costs (688) (232) (1,176)
Other operating costs (1,106) (401) (7,831)
---------- ---------- ----------
Operating loss (999) (533) (7,746)
---------- ---------- ----------
Other income (expenses) 58 (163) (153)
---------- ---------- ----------
Loss before income taxes (941) (696) (7,899)
Deferred income tax benefit 126 54 323
---------- ---------- ----------
Net loss $ (815) $ (642) $ (7,576)
========== ========== ==========
Loss per share (Note 3) $ (0.05) $ (0.05) $ (0.55)
========== ========== ==========
Average shares outstanding (Note 3) 15,119,650 13,838,078 13,838,078
========== ========== ==========
</TABLE>
See accompanying notes to condensed consolidated financial statements.
<PAGE> 4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
<TABLE>
<CAPTION>
THREE MONTHS ENDED TWELVE MONTHS ENDED
------------------ -------------------
MARCH 31, 1997 MARCH 31, 1996 DECEMBER 31, 1996
-------------- -------------- -----------------
(UNAUDITED) (AUDITED)
<S> <C> <C> <C>
Cash flows from operating activities:
Net loss $ (815) $ (642) $ (7,576)
--------- --------- ---------
Adjustments to reconcile net loss to net cash
provided by/(used in) operating activities:
Share compensation expense 19 -- 4,172
Depreciation of property, plant and equipment 305 103 484
Deferred income taxes (126) (44) (323)
Decrease/(increase) in restricted cash (156) 559 134
Increase in trade accounts receivable (56) (5) (139)
Increase in prepaid expenses and other current assets (501) 291 --
Increase in trade accounts payable 395 (70) 1,306
(Decrease)/increase in accrued expenses and other
long-term liabilities 179 59 (313)
--------- --------- ---------
Net cash provided by/(used in) operating activities (756) 251 (2,255)
Cash flows from investing activities:
Fixed asset purchases (368) (95) (1,061)
Purchase of investment securities (6,750) -- (194)
Net decrease/(increase) in loan receivable 3 (5) 3
--------- --------- ---------
Net cash used in investing activities (7,115) (100) (1,252)
Cash flows from financing activities:
Net proceeds from public offering 47,857 -- --
Capital contributions 4,066 2,000 6,500
Reimbursement of capital -- -- (57)
Repayment of obligations under capital leases (247) -- (1,101)
Proceeds from bank borrowings -- -- 194
Proceeds from loan from shareholder -- -- 101
--------- --------- ---------
Net cash provided by financing activities 51,676 2,000 5,637
--------- --------- ---------
Net increase/(decrease) in cash and cash equivalents 43,805 2,151 2,130
Cash and cash equivalents at beginning of period 2,541 634 411
--------- --------- ---------
Cash and cash equivalents at end of period $ 46,346 $ 2,785 $ 2,541
========= ========= =========
</TABLE>
See accompanying notes to condensed consolidated financial statements.
<PAGE> 5
NOTE 1 - BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements of
Euronet Services Inc. have been prepared from the records of Euronet Services
Inc. and subsidiaries (collectively, the "Company"), pursuant to the rules and
regulations of the Securities and Exchange Commission. In the opinion of
management, such financial statements include all adjustments (consisting only
of normal, recurring accruals) necessary to present fairly the financial
position of the Company at March 31, 1997 and the results of its operations and
its cash flows for the three-month periods ended March 31, 1997 and 1996. The
condensed consolidated financial statements should be read in conjunction with
the audited consolidated financial statements of Euronet Holding N.V. ("Euronet
N.V.") for the year ended December 31, 1996, including the notes thereto, set
forth in the Company's Form S-1 Registration Statement (No. 33-18121). For
reference purposes, the condensed consolidated financial statements for December
31, 1996, excluding the notes thereto, are contained herein.
The results of operations for the three month period ended March 31, 1997 are
not necessarily indicative of the results to be expected for the full year.
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES
There have been no significant additions to or changes in accounting policies of
the Company since December 31, 1996. For a description of these policies, see
Note 2 of Notes to Consolidated Financial Statements for the year ended
December 31, 1996.
NOTE 3 - NET LOSS PER SHARE
As the capital structure of the Company during 1996 is not indicative of the
capital structure after the initial public offering, pro-forma net loss per
share calculation for the three months ended March 31, 1996 has been included.
The pro-forma number of common and common equivalent shares, as described in
the audited consolidated financial statements of Euronet N.V. for the year
ended December 31, 1996 have been applied to the quarter ended March 31, 1996.
Common stock equivalents consist of shares issuable under the Company's stock
option plans using the treasury stock method.
Loss per share for the three-month period ended March 31, 1997 has been computed
by dividing net loss by the weighted average number of common shares outstanding
after giving effect to dilutive stock options. The weighted average number of
common shares outstanding assumes that the shares issued by the Company prior to
the date of the initial public offering have been outstanding since the
beginning of the period.
NOTE 4 - INITIAL PUBLIC OFFERING OF COMMON STOCK
On March 7, 1997, the Company consummated an initial public offering of
6,095,000 shares of common stock at a price of $13.50 per share. Of the
6,095,000 shares sold, 3,833,650 shares were sold by the Company and 2,261,350
shares by certain selling shareholders. Net proceeds to the Company were
approximately $47.9 million after deduction of the underwriting discount and
other expenses of the offering.
NOTE 5 - SHAREHOLDERS' EQUITY
Effective March 5, 1997, the Company changed the stated par value of all
common and preferred shares of Euronet N.V. from $0.10 to $0.14. Euronet N.V.
then effected a seven-for-one stock split which became effective on March 5,
1997, thus reducing the par value of such shares to $0.02. This change in par
value was retroactively taken into account for common and preferred shares of
Euronet N.V. as at March 31, 1996. Subsequently, effective March 6, 1997, the
holders of all of the preferred shares of Euronet N.V. converted all of such
preferred shares into common shares of Euronet N.V.
<PAGE> 6
The increase in par value from $0.01 to $0.02 and the seven-for-one stock split
have been given retroactive treatment to March 31, 1996.
Pursuant to an Exchange Agreement which became effective on March 6, 1997,
entered into between Euronet Services Inc. and the shareholders and option
holders of Euronet N.V., 10,296,076 shares of common stock in Euronet Services
Inc. were issued to the shareholders of Euronet N.V. in exchange for all the
common shares of Euronet N.V. In addition, options to acquire 3,113,355 shares
of common stock of Euronet Services Inc. were issued to the holders of options
to acquire 3,113,355 common shares of Euronet N.V. and awards with respect to
800,520 shares of common stock of Euronet Services Inc. were issued to the
holders of awards with respect to 800,520 preferred shares of Euronet N.V. in
exchange for all such awards.
<PAGE> 7
ITEM 2
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
GENERAL
OVERVIEW
Euronet Services Inc. and its subsidiaries (collectively, "Euronet" or the
"Company") are operators of independent shared automatic teller machine (ATM)
networks and are service providers to banks and financial institutions. Euronet
serves a number of banks in Poland and Hungary by providing ATMs that accept
cards with international logos such as VISA, American Express and Mastercard and
proprietary bank cards issued by member banks. The subsidiaries of Euronet are:
Euronet-Bank 24 Rt and SatComNet Kft (Hungary), Bankomat 24/Euronet Sp. z o.o.
(Poland), Euronet Holding N.V. (Netherland Antilles) and Euronet Services GmbH
(Germany). Subsequent to March 31, 1997, the Company incorporated EFT-Usluge d
o.o. (Croatia).
The Company was formed and established its first office in Budapest in July
1994. In May 1995, the Company opened its second office in Warsaw. To date, the
Company has devoted substantially all of its resources to establishing its ATM
network in Hungary and Poland through the acquisition and installation of ATMs
and computers and software for its processing center pursuant to capital leases
and through the marketing of its services to local banks in Hungary, Poland,
Germany and other regions in Central Europe as well as international card
organizations.
The Company installed its first ATM in Hungary in June 1995, and at the end
of 1996 the Company had 166 ATMs installed. An additional 90 ATMs were installed
during the first three months of 1997 and at April 30, 1997 the Company's ATM
network consists of 287 ATMs. Euronet's network consisted of 2 ATMs in Poland
and 57 ATMs in Hungary at March 31, 1996. With the expansion of operations, the
Company has increased the number of its employees in Hungary from 34 at March
31, 1996 and 36 at December 31, 1996 to 49 at March 31, 1997. In Poland, the
Company increased the number of its employees from 10 at March 31, 1996 and 20
at December 31, 1996 to 32 at March 31, 1997. The Company's expansion of its
network infrastructure and administrative and marketing capabilities has
resulted in increased expenditures. Further planned expansion will continue to
result in substantial increases in general operating expenses as well as
expenses related to the acquisition and installation of ATMs.
The Company has derived substantially all of its revenues from ATM
transaction fees since inception. The Company receives a fee from the card
issuing banks or international card organizations for ATM transactions processed
on its ATMs. As the Company continues to focus on expanding its network and
installing additional ATMs, the Company expects that transaction fees will
continue to account for substantially all of its revenues for the foreseeable
future. The Company recently began to sell advertising on its network by putting
clients' advertisements on its ATMs. Although revenues from advertising have
been insignificant to date, the Company believes that advertising revenues will
increase. In the second quarter of 1997, the Company also intends to begin
generating revenues from ATM network management services that it offers to banks
that own proprietary ATM networks.
As Euronet only began operations in Poland in January 1996, and due to the
significant growth in both revenues and operating expenses for the quarter ended
March 31, 1997 as compared to the same quarter of 1996, the Company believes
that the comparison of the operating results for the quarter is facilitated by
reference to the year
<PAGE> 8
ended December 31, 1996. Accordingly, the condensed statement of operations for
the full year ended December 31, 1996 has been included in this report.
RESULTS OF OPERATIONS
Quarter Ended March 31, 1997 Compared to the Quarter Ended March 31, 1996
Revenues. Total revenues increased to $795,000 for the quarter ended March
31, 1997 from $100,000 for the quarter ended March 31, 1996. This increase was
due primarily to the significant increase in transaction fees resulting from the
increase in the number of ATMs operated by the Company during the quarter ended
March 31, 1997 and a greater number of credit and debit card holders able to use
their cards at Euronet's ATMs. Transaction fee revenue represented approximately
90% of total revenues for the quarter ended March 31, 1997. Approximately 78% of
transaction fees in the quarter ended March 31, 1997 were attributable to cash
withdrawals, and 22% were attributable to balance inquiries and transactions not
completed because authorization was not given by the relevant card issuer.
Operating expenses. Total expenses increased by $1.2 million to $1.8
million for the quarter ended March 31, 1997 from $633,000 for the quarter ended
March 31, 1996. This increase was due primarily to costs associated with the
installation of significant numbers of ATMs during the period and expansion of
the Company's operations during the period.
ATM operating costs, which consists primarily of ATM site rentals,
depreciation of ATMs and costs associated with installing and maintaining ATMs
and providing telecommunications and cash delivery services to ATMs increased
$456,000 to $688,000 for the quarter ended March 31, 1997 from $232,000 for the
quarter ended March 31, 1996. The percentage of ATM operating costs to total
expenses for quarter ended March 31, 1997 remained stable at 38% as compared to
37% for the same period in 1996. The increase in ATM operating costs was
primarily attributable to costs associated with operating an increased number of
ATMs in the network during the period. The number of ATMs in the network
increased from 34 to 190 from March 31, 1996 to March 31, 1997.
Other operating expenses, which includes salaries, professional fees and
other general and administrative expenses, increased $705,000 in the quarter
ended March 31, 1997, from $401,000 for the same period in 1996. This increase
was due primarily to expansion of the Company's operations during the period,
especially the increase in the number of employees in the Company. In Poland the
number of employees increased from 10 at March 31, 1996 to 32 at March 31, 1997.
In Hungary, the number of employees increased from 34 to 49 in the same period.
Euronet has also employed two individuals in Germany and, at March 31, 1997, 1
in Croatia.
Other income/expense. Interest income increased $74,000 to $75,000 for the
quarter ended March 31, 1997 from $1,000 for the quarter ended March 31, 1996.
The increase was due to larger amounts held in interest bearing securities
primarily as a result of investing the proceeds of the public offering. See
"--Liquidity and Capital Resources".
Interest expense relating principally to capital leases of ATMs and the
Company's computer systems increased $86,000 to $111,000 for the quarter ended
March 31, 1997 from $25,000 for the quarter ended March 31, 1996. This increase
was due primarily to the increase in capital lease obligations for ATMs
outstanding during the period.
Net loss. The Company's net loss increased $173,000 to $815,000, or $(0.05)
per share, during the quarter ended March 31, 1997 from $642,000, or $(0.05) per
share, for the quarter ended March 31, 1996 as a result of the factors
previously discussed.
<PAGE> 9
LIQUIDITY AND CAPITAL RESOURCES
On March 7, 1997, the Company consummated an initial public offering of
6,095,000 shares of common stock at the price of $13.50 per share. Of the
6,095,000 shares sold, 3,833,650 shares were sold by the Company and 2,261,350
shares by certain selling shareholders. Net proceeds to the Company were
approximately $47.9 million after deduction of the underwriting discount and
other expenses of the offering. The Company intends to use the proceeds to
cover expenditures relating to the expansion and operation of its ATM network
and the provision of ATM management services.
Since its inception, the Company has sustained negative cash flows from
operations and has financed its operations and capital expenditures primarily
through private placements of equity securities and through equipment lease
financing. The net proceeds of such transactions, together with revenues from
operations and interest income have been used to fund aggregate net losses of
approximately $10,500,000 and investments in property, plant and equipment.
The Company had $51.8 million of working capital at March 31, 1997, including
$47.3 million of cash and cash equivalents and $6.9 million of investment
securities. Approximately $41.0 million of the cash and cash equivalents and all
of investment securities resulted from the net proceeds from the offering. Cash
has been, and the Company contemplates that it will continue to be, invested in
interest bearing, investment grade securities pending use in the Company's
business.
The Company leases the majority of its ATMs under two principal capital lease
arrangements that expire in July 1999 and January 2001, respectively. The
leases bear interest at 15% and 11%, respectively. As of March 31, 1997 the
Company owed approximately $6.3 million under such capital lease arrangements.
The amount owed by the Company under such lease agreements is expected to
increase significantly as the Company continues to lease increased numbers of
ATMs in pursuit of its business strategy.
The Company anticipates that the estimated net proceeds of the Offering and the
interest earned thereon, together with its existing capital resources and
anticipated cash flow from planned operations, will be adequate to satisfy its
capital requirements, capital lease payment obligations and other requirements,
including possible acquisitions, until the Company begins to generate
sufficient cash flows to fund its operations. There can be no assurance,
however, that the Company will achieve or sustain profitability or generate
significant revenues in the future. It is possible that the Company may seek
additional equity or debt financing in the future.
FORWARD LOOKING STATEMENTS
Statements in "Management's Discussion and Analysis of Financial Condition and
Results of Operations" and elsewhere in this quarterly report that are not
descriptions of historical fact may be forward looking statements that are
subject to risks and uncertainties. Actual results could differ materially from
those currently anticipated due to a number of factors, including but not
limited to, the Company's dependence on the maintenance of its contracts with
banks and international card organizations, dependence on key personnel,
dependence on ATM transaction fees, competition, and political, economic and
legal risks in the markets in which the Company operates.
DISCLOSURES ABOUT NEW ACCOUNTING STANDARDS
SFAS No. 128, "Earnings Per Share", was issued in February 1997. This Statement
simplifies the standards for computing earnings per share previously found in
APB Opinion No. 15, "Earnings Per Share", and makes them more comparable to
international EPS standards. Statement 128 replaces the presentation of primary
EPS with a presentation of basic EPS. In addition, the Statement requires dual
presentation of basic and diluted EPS on the face of the income statement for
all entities with complex capital structures and requires a reconciliation of
the numerator and denominator of the basic EPS computation to the numerator and
denominator of the diluted EPS computation. This Statement is required to be
adopted for the fiscal year ending December 31, 1997. The Company has not yet
assessed the impact of Statement 128 on its financial statements.
<PAGE> 10
INFLATION
Since the fall of Communist rule, both Hungary and Poland have experienced high
levels of inflation and significant fluctuation in the exchange rate for their
currencies. Although revenues generally are received by the Company in local
currency, primarily Hungarian forints and Polish zlotys, the Company's
Acceptance Agreements and agreements relating to the provision of ATM management
services generally provide for fees denominated in U.S. dollars or that are
inflation adjusted. A significant portion of the Company's expenditures,
including costs associated with the acquisition of ATMs and executive salaries,
are made in or are denominated in U.S. dollars. A substantial portion of the
assets and liabilities of the Company are also denominated in U.S. dollars,
including fixed assets, shareholders' equity and capital lease obligations. The
Company attempts to match local currency receivables and payables. Hence, the
amount of unmatched assets and liabilities giving rise to foreign exchange gains
and losses is relatively limited, consisting mostly of cash and cash
equivalents. Due to the factors mentioned above, the Company does not believe
that inflation will have a significant effect on results of operations or
financial condition.
<PAGE> 11
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None
ITEM 2. CHANGES IN SECURITIES
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4. SUBMISSIONS OF MATTERS TO VOTE OF SECURITY HOLDERS
None
ITEM 5. OTHER INFORMATION
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
<TABLE>
<CAPTION>
EXHIBIT NUMBER DESCRIPTION OF DOCUMENT
-------------- -----------------------
<C> <S>
</TABLE>
<PAGE> 12
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
March 14, 1997 By: /s/ Michael J. Brown
- -------------- ---------------------------------
Chief Executive Officer
March 14, 1997 By: /s/ Bruce S. Colwill
- -------------- ---------------------------------
Principal Financial and Accounting Officer
<PAGE> 13
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION OF DOCUMENT
----------- -----------------------
<C> <S>
3(i) Certificate of Correction of
Certificate of Incorporation
3(ii) Amendment to By-Laws
11 Earnings Per Share
27 Financial Data Schedule
</TABLE>
<PAGE> 1
CERTIFICATE OF CORRECTION
BEING FILED TO CORRECT
CERTAIN ERRORS IN
THE CERTIFICATE OF INCORPORATION
OF
EURONET SERVICES INC.
Euronet Services Inc., a corporation organized and existing under and by
virtue of the General Corporation Law of the State of Delaware (the
Corporation), does hereby certify the following:
FIRST: The name of the Corporation is:
Euronet Services Inc.
SECOND: The Certificate of Incorporation (the Certificate) was filed by the
Secretary of State of the State of Delaware on December 13, 1996 and
the Certificate requires correction as permitted by Section 103(f) of
the General Corporation Law of the State of Delaware.
THIRD: The Certificate incorrectly stated Article FOURTH (a) as follows:
FOURTH: (a) The total number of shares of all classes of capital
stock which the Corporation shall have authority to issue is
Forty Million Shares (40,000,000) shares consisting of:
1. Ten Million (10,000,000) shares of preferred
stock, par value one cent ($.01) per share (the "Preferred
Stock");
2. Thirty Million (30,000,000) shares of common
stock, with a par value of one cent ($.01) per share
("Common Shares");
The foregoing Article FOURTH (a) was erroneously stated since the par
value of the stock is incorrect.
FOURTH: The inaccuracy of the Certificate is hereby corrected, by deleting the
present Article FOURTH (a) and inserting a new Article FOURTH (a) as
follows:
FOURTH: (a) The total number of shares of all classes of capital
stock which the Corporation shall have authority to issue is
Forty Million Shares (40,000,000) shares consisting of:
[Continued on next page]
<PAGE> 2
1. Ten Million ($10,000,000) shares of preferred
stock, par value two cents ($.02) per share (the "Preferred
Stock");
2. Thirty Million (30,000,000) shares of common
stock, with a par value of two cents ($.02) per share
("Common Shares");
IN WITNESS WHEREOF, this Certificate of Correction is executed on this 4th
day of March, 1997, by the Secretary of the Corporation in accordance with
Section 103(a)(2) of the General Corporation Law of the State of Delaware.
Jeffrey B. Newman
Jeffrey B. Newman, Secretary
<PAGE> 1
Exhibit 3(ii)
Resolution of the Board of Directors
Adopted at a Meeting of the Board of Directors
of Euronet Services Inc. on April 22, 1997
RESOLVED, that the first annual shareholders meeting of the Corporation be held
in 1998, at a time and place determined by the Board of Directors at the last
meeting of the Board held in 1997. Article II, Section 1 of the By-Laws of the
Corporation is hereby amended by the deletion of the reference to "1997" and
its replacement by a reference to the year "1998."
<PAGE> 1
EXHIBIT 11
COMPUTATION OF PRIMARY EARNINGS PER ORDINARY
SHARE AND ORDINARY SHARE EQUIVALENTS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31, 1997
------------------
(UNAUDITED)
<S> <C>
Earnings per ordinary share and ordinary share equivalents
Primary
Weighted average ordinary shares outstanding 12,679
Average ordinary share options outstanding
(net of repurchased shares under the
treasury stock method) 2,440
Weighted average number of ordinary shares and -------
ordinary share equivalents outstanding 15,119
-------
Net Income $ 815
-------
Primary earnings per ordinary share and
ordinary share equivalent $ 0.05
-------
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 47,320
<SECURITIES> 6,944
<RECEIVABLES> 228
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 55,426
<PP&E> 10,367
<DEPRECIATION> 927
<TOTAL-ASSETS> 65,481
<CURRENT-LIABILITIES> 3,606
<BONDS> 5,524
0
0
<COMMON> 305
<OTHER-SE> 55,958
<TOTAL-LIABILITY-AND-EQUITY> 65,481
<SALES> 0
<TOTAL-REVENUES> 795
<CGS> 0
<TOTAL-COSTS> 1,794
<OTHER-EXPENSES> 75
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 111
<INCOME-PRETAX> (941)
<INCOME-TAX> (126)
<INCOME-CONTINUING> (815)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (815)
<EPS-PRIMARY> (.05)
<EPS-DILUTED> 0
</TABLE>
