PYDS Plans for Continued Investment in Company and Announces General Guidance for 2015

SAN ANTONIO, Aug. 25, 2015 (GLOBE NEWSWIRE) -- Payment Data Systems, Inc. (NASDAQ:PYDS) an integrated electronic payments solutions provider, today announced its intentions to continue to reinvest in the business at a measured pace while maintaining profitability for 2015.

The Company expects revenue growth to accelerate in Q3 and Q4 of 2015, with further growth in Q1 and Q2 of 2016. Specifically, the Company is targeting 10-20% quarterly growth in revenue beginning in 2016. New products and features debuting in late 2015 will fuel the revenue expansion.

As previously reported, the Company expects one-time legal and transfer agent charges associated with the reverse share split, which took place on July 23, and fees associated with the NASDAQ uplisting, which took place on August 11, 2015. These are some of several executed and planned investments to strengthen the business and position the Company for continued growth.

"Payment Data is generating gross and net profit margins achieved only by the largest payment processors in our industry. Even without our competitors' scale, our operations are incredibly efficient," said Habib Yunus, CFO. "At this stage, revenue growth will be the primary driver of future profit growth, and we need to position the Company to be able to continue to grow our top-line."

The Company had gross margins of 35% and a net profit margin (before tax) of 18% in the year ended December 31, 2014. Based on preliminary data, the Company expects its 2015 gross margins to be 35-40% and net profit margin (before tax) to be 10-15% for the year ending December 31, 2015. The Company also expects to see revenue growth in 2015 with the growth accelerating in 2016.

"Now that we're on NASDAQ it's important that we work to protect our existing business as well as add new business," said Houston Frost, SVP of Corporate Development. "We look to make investments in our compliance programs and customer service, as well as in our technology, sales and marketing efforts."

"We're committed to staying profitable," said Louis Hoch, President and COO. "The free cash flow we are generating will produce a much greater return reinvested in the business than sitting in a bank account. Our new executive team is doing a fantastic job planning the future of this Company."

"This year we've added to our sales team, technology team, and our customer service team and we're investing in our compliance and controls. We look to continue to increase our investment in these areas as our revenue increases," said Habib Yunus, CFO. "It's exciting. We are evolving daily and excited about new product development and our sales pipeline."

"Integration of Akimbo with the PDS family has pushed us in an incredibly positive direction," said Houston Frost. "Investing in our business is critical, and we're stepping up to the plate. I'm very excited about a few upcoming product announcements that will increase our value and visibility in the market."

Michael Long, Company's CEO and Chairman said, "We are happy to be trading on NASDAQ, but now the real work begins. We want to remain profitable while making the right decisions to grow our business. Some of our products and services are mature, profitable and serve an established need. We also have new products under development that will provide market leadership in forward-looking ways. The ability to fund new product development with revenue generated by existing services allows for a continuous improvement cycle that fosters creativity and innovation. All together this allows for stability in our cash flow while creating opportunities to maximize profits."

Mr. Long continued, "I want to thank our shareholders who have remained loyal throughout the years and through the recent transition. I know we're all going to be proud of what we've achieved in 2015, but I'm really excited about what the foundation we're building will produce in 2016. We expect to continue the rapid growth we have demonstrated over the past few years."

About Payment Data Systems, Inc.

Payment Data Systems is an integrated payment solutions provider to merchants and billers. The organization provides an extensive set of products to deliver world-class payment acceptance. Payment Data has solutions for merchants, billers, banks, service bureaus and card issuers. The strength of the Company is its ability to offer specifically tailored solutions for card issuance, payment acceptance and bill payments.

For additional information, visit www.paymentdata.com. Contact Michael Long for Investor Relations information at 210.249.4040 or email at ir@paymentdata.com.

Website: www.paymentdata.com, www.ficentive.com, www.zbill.com Find us on Facebook®

FORWARD-LOOKING STATEMENTS DISCLAIMER

Except for the historical information contained herein, the matters discussed in this release include certain forward-looking statements, which are intended to be covered by safe harbors. Those statements include, but may not be limited to, all statements regarding the Company's and management's intent, belief and expectations, such as statements concerning the Company's future and its operating and growth strategy. Investors are cautioned that all forward-looking statements involve risks and uncertainties including, without limitation, the factors detailed from time to time in the Company's filings with the Securities and Exchange Commission. One or more of these factors have affected, and in the future could affect, the Company's businesses and financial results and could cause actual results to differ materially from plans and projections. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by the Company or any other person that the Company's objectives and plans will be achieved. All forward-looking statements made in this release are based on information presently available to the Company's management. The Company assumes no obligation to update any forward-looking statements, except as required by law.

Source:Payment Data Systems, Inc.