DirectCash Income Fund announces results of operations for the three and nine
months ended September 30, 2009

TSX: DCI.UN

CALGARY, Nov. 12 /CNW/ - DirectCash Income Fund ("DirectCash" or the "Fund") today announced consolidated financial results for the three and nine months ended September 30, 2009. The Fund's consolidated financial statements for the three and nine months ended September 30, 2009 and Management's Discussion & Analysis, as well as additional information about the Fund are available on SEDAR (www.sedar.com).

    
      Q3 2009 Financial and Operational Highlights compared to Q3 2008:
      -----------------------------------------------------------------

    -   Increased EBITDA 17% to $7.5 million
    -   Increased distributable cash flow 21% to $6.7 million
    -   Distributable cash flow payout ratio has been reduced to 65% from 77%
    -   Increased the number of prepaid cash card transactions by 14%
    

Management's Commentary

"We continue to be pleased with our strong financial results in 2009, with significant improvements in EBITDA and Distributable Cash Flow. We have seen gains in each of our business segments, and are excited about our performance in Mexico to date" said Jeffrey Smith, DirectCash's President and Chief Executive Officer. The primary drivers for the improvements over the prior year period are the contributions from Mexican ATM operations, the year over year impact of the 2008 ATM acquisitions, and the higher year over year activity in prepaid cash card activations and transactions. The ATM business, which is the backbone of DirectCash's business, continues to generate consistent performance while strong growth has also been seen from DirectCash's prepaid products businesses.

DirectCash will continue to focus on growth in a sustainable manner via organic means and through additional accretive acquisitions as opportunities arise. DirectCash's stable, contracted revenue stream, dominant market positions, and continued growth will continue to provide consistent cash distributions to DirectCash's Unitholders. In addition, DirectCash is considering new geographic markets, such as the recently initiated Mexican operation which is now adding to recurring services revenue growth and gross profit margins.

For purposes of comparison, DirectCash provides the following selected operational and financial data:

    
    Operational Highlights
    -------------------------------------------------------------------------
                                 Three months ended       Nine months ended
                                     September 30            September 30
                                  2009        2008        2009        2008
    -------------------------------------------------------------------------
                              (unaudited) (unaudited) (unaudited) (unaudited)
    Number of machines
      ATM terminals - active(1)    6,344       6,081       6,344       6,081
      Debit terminals - active(1)  3,094       3,091       3,094       3,091

    Number of transactions
      ATM transactions         7,941,845   8,318,237  22,832,724  22,941,768
      Debit terminal
       transactions            2,793,966   2,587,409   7,725,829   7,106,394
      Prepaid cash card
       activations               723,282     536,036   2,282,184   1,947,021
      Prepaid cash card
       transactions            1,765,069   1,173,983   5,748,377   4,894,453
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    (1) DirectCash has included statistics only for sites that recorded a
        transaction in the past calendar month.
    

On a year over year basis, the number of active ATMs increased by 263. The net increase is a result of the gain of a customer with approximately 90 locations during the third quarter, an acquisition made at the end of the second quarter and additional ATMs placed in Mexico.

ATM revenues increased when compared to 2008 due to the impact of Mexican ATM operations and the overall increase in the number of ATMs in operation during the period.

The slight decrease in ATM transactions reflects the impact of a maturing ATM market in Canada. DirectCash's focus in the ATM business is to continue to add sites and grow aggregate transactions both organically and through accretive acquisitions and to maximize site profitability through cost and quality control. In addition, DirectCash is considering new geographic markets, such as the recently started Mexican operation which is now adding to recurring services revenue growth and gross profit margins.

The number of active debit terminals has slightly increased. In the first quarter of 2009 DirectCash lost a major debit terminal customer due to insolvency, which impacted 185 sites. DirectCash has since recovered this loss with additional organic growth. Given the relatively flat year over year growth in the number of active debit terminal sites, DirectCash still posted respectable increases in transactions for the three and nine months ended September 30, 2009. DirectCash continues to pursue organic growth in this business segment and to grow market share by providing retailers with unique products and services to enhance the business viability of the debit terminal for the retailer.

The growth in prepaid card activations is a result of new customer relationships and growth within existing relationships. The MasterCard prepaid card program continues to find traction and displace some debit card activations.

The increase in prepaid card transactions is due to the same reasons noted above, as well as an increase in transactions per card as prepaid products continue to gain consumer acceptance and confidence. Activation and transaction volume figures include both prepaid debit and prepaid credit cards.

The following table presents a summary of the DirectCash's selected consolidated financial information for the three and nine months ended September 30, 2009 and 2008:

    
    Financial Highlights
    -------------------------------------------------------------------------
                                 Three Months Ended       Nine Months Ended
    (thousands)                      September 30            September 30
                                  2009        2008        2009        2008
    -------------------------------------------------------------------------
                              (unaudited) (unaudited) (unaudited) (unaudited)
    Revenues
      Recurring services
       revenue                 $  19,344   $  16,540   $  55,610   $  46,858
      Products revenue             5,691       6,075      16,897      19,259
      Interest income                 10          95          79         429
    -------------------------------------------------------------------------
    Total revenue              $  25,045   $  22,710   $  72,586   $  66,546
    -------------------------------------------------------------------------

    Gross Profit
      Recurring services
       and interest            $  11,113   $   9,588   $  31,851   $  27,304
        Gross profit margin        57.4%       57.6%       57.2%       57.7%
      Products                       201         159       1,001       1,227
        Gross profit margin         3.5%        2.6%        5.9%        6.4%
    -------------------------------------------------------------------------
    Total gross profit         $  11,314   $   9,747   $  32,852   $  28,531
      Total gross profit margin    45.2%       42.9%       45.3%       42.9%
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Expense and other income:
      Selling, general and
       administrative              3,129       2,940       9,739       8,640
      Long-term incentive plan       396         415       1,044         930
      Interest                       204         549         728       1,537
      Foreign exchange
       translation (gain)/loss       308           -         266           -
      Depreciation of equipment      760         656       2,324       1,838
      Amortization of
       intangible assets           2,231       5,071       8,525      14,349
    -------------------------------------------------------------------------
                               $   7,028   $   9,631   $  22,626   $  27,294

    -------------------------------------------------------------------------
    Net earnings before
     income taxes              $   4,286   $     116   $  10,226   $   1,236
    -------------------------------------------------------------------------

      Income taxes                                 -         179           -
    -------------------------------------------------------------------------
    Net earnings               $   4,286   $     116   $  10,047   $   1,236
      Net earnings per unit         0.34        0.01        0.81        0.10
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Add back:
      Interest                       204         549         728       1,537
      Depreciation of equipment      760         656       2,324       1,838
      Amortization of
       intangible assets           2,231       5,071       8,525      14,349
      Income taxes                     -           -         179           -
    -------------------------------------------------------------------------
    EBITDA                     $   7,481   $   6,392   $  21,803   $  18,960
      EBITDA margin                29.9%       28.1%       30.0%       28.5%
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Total assets               $ 116,854   $ 124,649   $ 116,854   $ 124,649
    Total debt                 $  36,860   $  40,470   $  36,860   $  40,470
    Total debt net of cash     $  14,985   $  22,244   $  14,985   $  22,244
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

Revenue

Total revenue has increased by 9% for the nine months ended September 30, 2009, as compared to the prior year period. Revenue by line of business, which includes both recurring services and products revenue, is as follows:

    
    Revenue by Line of Business
    -------------------------------------------------------------------------
                                 Three months ended       Nine months ended
    (thousands)                      September 30            September 30
                                  2009        2008        2009        2008
    -------------------------------------------------------------------------
                              (unaudited) (unaudited) (unaudited) (unaudited)

    ATM Business               $  11,268   $  10,229   $  31,959   $  28,617
    Prepaid products business     13,234      12,024      39,225      36,640
    Debit terminal business          543         457       1,402       1,289
    -------------------------------------------------------------------------
    Total Revenue              $  25,045   $  22,710   $  72,586   $  66,546
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Revenue by type
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Recurring services         $  19,344   $  16,540   $  55,610   $  46,858
    Products                       5,691       6,075      16,897      19,259
    Interest                          10          95          79         429
    -------------------------------------------------------------------------
    Total Revenue              $  25,045   $  22,710   $  72,586   $  66,546
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

Revenue - Recurring Services

Recurring services revenue relates to revenue earned from transaction processing activities, including DirectCash's ATM, debit terminal and prepaid product lines of business.

The increase of 19% over 2008 in recurring services revenue is attributable to both the ATM and prepaid products line of businesses. The increase in ATM recurring services revenue is related to the revenues generated from Mexico and the year over year impact of the ATM acquisitions made during 2008. The increase in prepaid products recurring services revenue comes primarily from the MasterCard prepaid card product as customers show greater acceptance and use of this product. DirectCash's prepaid card merchant customers are also continuing to expand their customer base through the growth of their retail locations.

There is historic seasonality in processing transaction volumes, with the highest ATM transaction activity in Canada typically occurring in the second and third quarters of the year. The first and fourth quarters are traditionally DirectCash's weakest quarters in terms of processing transactions and gross profitability. In Mexico, seasonality in the ATM business is the opposite of what is seen from DirectCash's Canadian operations. DirectCash has eliminated the impact of seasonal fluctuations in cash flows to Unitholders by equalizing monthly cash distributions. This seasonality is considered when determining levels of available cash at the end of each reporting period.

Revenue - Products

Product revenue includes sales of ATM machines, debit terminals and related parts, as well as prepaid products, consisting of prepaid cards (debit and credit), prepaid telephone cards, both physical ("hard cards") and electronic ("virtual vouchers").

For the three and nine months ended September 30, 2009 revenue from product sales was down 6% and 12% respectively compared to the prior year. The primary reason for the lower revenues is the decline in the sales of telephone cards. DirectCash has seen a reduction in the sale of long-distance telephone and cellular cards in Alberta, where a number of clients are dependent upon the transient oil and gas work force which has been reduced in recent months.

ATM sales were up due to sales in Mexico, while debit terminals sales were flat on a year over year comparison as the business model for this component of the business continues to lean towards owning or renting machines versus selling them.

Interest Income

Interest income declined significantly during the period on a year over year basis as a result of the impact of lower interest rates that can be realized on funds held in short term deposits.

Gross Profits

In total, gross profits have increased by 16% and 15% respectively for the three and nine months ended September 30, 2009, as compared to the same periods last year. Gross profit by line of business, which includes both recurring services and products revenue, is as follows:

    
    Gross profit by Line of Business
    -------------------------------------------------------------------------
                                 Three months ended       Nine months ended
                                     September 30            September 30
                                  2009        2008        2009        2008
    -------------------------------------------------------------------------
                              (unaudited) (unaudited) (unaudited) (unaudited)

    ATM Business               $   6,314   $   5,856   $  18,665   $  17,015
      gross profit margin          56.0%       57.2%       58.4%       59.5%
    Prepaid products business      4,614       3,602      13,175      10,696
      gross profit margin          34.9%       30.0%       33.6%       29.2%
    Debit terminal business          386         289       1,012         820
      gross profit margin          71.3%       63.2%       72.2%       63.6%
    -------------------------------------------------------------------------
    Total Gross Profit         $  11,314   $   9,747   $  32,852   $  28,531
      gross profit margin          45.2%       42.9%       45.3%       42.9%
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Gross profit by type
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Recurring services and
     interest                  $  11,113   $   9,588   $  31,851   $  27,304
      gross profit margin          57.4%       58.0%       57.3%       58.3%
    Products                         201         159       1,001       1,227
      gross profit margin           3.5%        2.6%        5.9%        6.4%
    -------------------------------------------------------------------------
    Total Gross Profit         $  11,314   $   9,747   $  32,852   $  28,531
      gross profit margin          45.2%       42.9%       45.3%       42.9%
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

Gross Profitability - Recurring Services

Total gross profits from recurring services revenue and interest income for the three and nine months ended September 30, 2009 increased by 16% and 17% respectively over the prior year.

The increase in gross profitability for recurring services can be attributed to the following factors:

    
    (a)    positive contribution from the Mexican ATM operations,
    (b)    the impact of the ATM acquisitions made during 2008, and
    (c)    the higher activity in prepaid card activations and transactions.
    

Gross profit margins on a year over year comparison increased by about two percentage points due to a relative shift from lower margin prepaid phone cards to higher margin prepaid cash cards.

The ATM recurring services gross margins improved as a result of the Mexican ATM operations and the impact of the 2008 Canadian acquisitions resulting in more active machines and higher revenue per transaction.

The increase in activation and transaction levels in the prepaid products line of business resulted in the increase in contribution from the recurring services business segment.

Gross Profitability - Products

Gross profit from the sale of products for the three and nine months ended September 30, 2009 increased by $42 thousand and declined by $226 thousand respectively from 2008.

The decline can be explained primarily by:

    
    (a) lower margin contributions on the sales of ATMs and debit terminals
        as the business model continue to lean towards full ownership and
        rental of units;
    (b) lower margin contributions from the telephone cards as revenues
        declined on a year over year basis; and
    (c) higher inventory obsolescence write downs in the first two quarters
        of 2009 due to increased security requirements in our industry.
    

DirectCash has a strategic focus of keeping ATM and debit terminal purchase prices as low as possible for the DirectCash customer in order to maximize the number of machines that can be placed. DirectCash believes that this strategy will result in additional long-term revenue generating services contracts.

Selling, General & Administrative Expenses ("SG&A")

For the three and nine months ended September 30, 2009 SG&A expenses increased by 6% and 13% respectively from the prior year.

The increase is the result of higher salaries and benefits incurred from Mexican operations, as well as the addition of some key staff members brought on to assist in DirectCash's growth.

As a percentage of gross profits, SG&A was 27% (YTD - 30%) during the three months ended September 30, 2009 compared to 30% (YTD - 30%) for the same period last year.

Long-term incentive plan ("LTIP")

Details of the Long-term incentive plan can be found in the notes to the financial statements.

Subsequent to the quarter, the board increased the base threshold from $1.51 to $1.65, effective from January 1, 2009. This resulted in lowering the expected LTIP expense for the year by $438,600.

Interest Expense

For the nine months ended September 30, 2009 interest expense has decreased significantly. DirectCash is benefiting from the lower interest rate environment as well as lower outstanding balance on DirectCash's credit facility.

All DirectCash debt is currently on floating interest rates. A one percent change in interest rates would result in an approximate $276 thousand change in interest expense for the period.

Net Earnings

Net earnings for the three and nine months ended September 30, 2009 were significantly higher than prior year periods mainly due to amortization of intangible assets being lower by $2.2 million for the third quarter and $5.8 million for the year to date.

The disparity between net earnings and cash distributions is primarily due to amortization of intangible assets related to ATM, debit terminal and prepaid product contracts. Typically, these contracts include automatic renewals for a further minimum five year period (new contracts are six years) unless the customer terminates the contract within a specified time period and includes a right of first refusal to match a competitor's bona fide offer on renewal. Thus, while a contract acquired by DirectCash may have a fixed initial term (which is the time period over which amortization of this intangible asset occurs) DirectCash's experience is that DirectCash is usually able to keep the applicable ATMs attached to the DirectCash network with no or little capital expenditure. Also, any ATM added by organic growth (i.e. through the DirectCash sales force) has a much lower capital cost that ATM locations added through acquisition.

EBITDA

For the three and nine months ended September 30, 2009, EBITDA increased significantly over prior year levels, although slightly lower than the increase in gross profits. This reflects the higher gross profit contributions offset in part by the higher SG&A and LTIP costs. As a percentage of revenue, EBITDA was slightly higher than both the prior year periods.

    
    Capital Expenditures
    -------------------------------------------------------------------------
                                 Three months ended       Nine months ended
                                     September 30            September 30
    -------------------------------------------------------------------------
                                  2009        2008        2009        2008
    -------------------------------------------------------------------------
    Per consolidated
     financial statements:
    Acquisitions               $     365   $       -   $   1,965   $   6,850
    Other capital expenditures       813         356       2,404       1,419
    Other intangible
     expenditures                    113          11         637         105
    -------------------------------------------------------------------------
                               $   1,291   $     367   $   5,006   $   8,374
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Split between growth
     and maintenance:
    Growth capital             $     693   $     116   $   3,901   $   7,283
    Maintenance capital              598         251       1,105       1,091
    -------------------------------------------------------------------------
                               $   1,291   $     367   $   5,006   $   8,374
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

Growth capital expenditures relate to acquisitions and other expenditures that increase DirectCash's productive capacity, while maintenance capital expenditures maintain productive capacity at existing levels.

Productive capital maintenance expenditures for the full year are expected to be slightly higher than 2008 due to increased security infrastructure expenditure requirements. Growth capital expenditures can vary widely between reporting periods due to the intermittent nature and varying size of acquisitions.

Acquisition

On August 30, 2009, The Fund acquired certain assets (mainly customer relationships) in the prepaid line of business for consideration of $1.00 and with a profit sharing agreement on those customers, to a maximum of $450,000 ending 2015.

On September 10, 2009, DirectCash acquired certain assets of a privately held corporation engaged in ATM services for cash consideration of $365,000, subject to a customary performance holdback and normal course purchase adjustments.

The majority of the assets acquired consist of the residual rights in contracts to operate and place ATM machines at certain locations. These contracts are valued based on the remaining term of each agreement and the expected net cash flow from that agreement value is allocated to intangible assets and amortized in accordance with our policy. This corporation was a distributor of DirectCash and therefore the number of ATMs acquired was already included in our ATM count.

The acquisition was initially funded from our revolving credit facility. The acquisitions were accounted for by the purchase method and the results of operations have been included in the Fund's consolidated statement of earnings from the acquisition dates.

This purchase equation is preliminary and subject to changes pending receipt of final information.

The fair values of the assets acquired are as follows:

    
    -------------------------------------------------------------------------
                                                                      2009
    -------------------------------------------------------------------------
    Assets acquired:
      Intangible assets                                            $ 340,950
      Equipment                                                       24,050
    -------------------------------------------------------------------------
    Total consideration                                              365,000
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

Liquidity and Capital Resources

DirectCash believes that the funds generated from operations will be sufficient to allow DirectCash to meet ongoing requirements for working capital, maintenance capital expenditures including investments in technology capital, interest expense, and cash distributions to Unitholders.

DirectCash's actual cash generated from operations will be dependent upon future financial performance, which in turn will be subject to financial, tax, business and other factors.

As of September 30, 2009, DirectCash utilized approximately $37 million of a total available credit facility of $60.0 million. A summary of DirectCash's available credit at September 30, 2009 is as follows:

    
    -------------------------------------------------------------------------
    (thousands)                             Utilized       Limit   Available
    -------------------------------------------------------------------------

    Revolving credit facility              $   4,360   $  20,000   $  15,640
    Acquisition credit facility               32,500      40,000       7,500
    -------------------------------------------------------------------------
                                           $  36,860   $  60,000   $  23,140
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

The revolving credit facility is used for ATM cash loading, working capital requirements and commercial letters of credit. A letter of credit in favour of MasterCard International was increased to US$ 1.5 million (CDN$ 1.6 million) due to the increase in volume in the MasterCard prepaid card program.

The acquisition credit facility is used to facilitate acquisitions and to fund business growth opportunities.

Both facilities are demand in nature. Notwithstanding the demand nature of the facilities, there are no scheduled principal repayments.

During the second quarter the Bank increased our lending rate due to current global market conditions on both facilities to Prime plus 1%. This increase will be phased in over four quarters in equal increments, starting July 1, 2009.

DirectCash is subject to the following primary lending covenants:

    
    -------------------------------------------------------------------------
                                    September 30, 2009    Covenant Limit
    -------------------------------------------------------------------------
    Funded Debt to Recurring
     Quarterly Revenue                          1.97:1    (less than) 10:1
    Fixed Charge Cover Ratio                      29:1    (greater than) 4:1
    Senior Debt to EBITDA                       1.25:1    (less than) 2:1
    -------------------------------------------------------------------------
    

DirectCash operated well within its loan covenant limits and anticipates continuing to do so in the future. Breach of DirectCash's bank loan covenants could result in the triggering of remedies by DirectCash's lenders, which could negatively impact distribution payments.

Additional Information

Additional information about DirectCash, including DirectCash's Annual Information Form and other public filings is available on SEDAR (www.sedar.com) and on DirectCash's website (www.directcash.net).

Non-GAAP Measures

There are a number of financial calculations that are not defined performance measurements under GAAP but which DirectCash believes are useful and accepted performance measurements utilized by the investing public in assessing the overall financial performance of income trusts.

Earnings before interest, taxes, depreciation and amortization ("EBITDA")

EBITDA represents gross profits less selling, general and administrative expenses ("SG&A") and long-term incentive plan expenses, and is not a defined performance measure under GAAP. DirectCash believes that EBITDA is a useful supplementary disclosure commonly used by the investing community to assess and compare cash flows between entities. EBITDA specifically excludes depreciation, amortization, income taxes and interest expense. DirectCash's EBITDA may differ from similar computations as reported by other issuers and, accordingly, may not be comparable to EBITDA as reported by such issuers. The most directly comparable GAAP measure is Net Earnings. A reconciliation between EBITDA and Net Earnings is disclosed in the "Financial Highlights" schedule later on.

Standardized distributable cash flow and standardized distributable cash flow per unit

On July 6, 2007, the Canadian Securities Administrators ("CSA") published revised National Policy Statement 41-201 Income Trusts and Other Direct Offerings that includes guidance concerning distributable cash flow measures and their related disclosure. In accordance with the interpretive release issued by the Canadian Institute of Chartered Accountants ("CICA"), DirectCash has calculated a distributable cash flow measure called Standardized Distributable Cash Flow and has included it as an additional disclosure. Standardized Distributable Cash Flow is calculated as cash flow from operations including the effect of changes in non-cash working capital less total capital expenditures required to preserve productive capacity, and restrictions on distributions resulting from compliance covenants. Due to normal course changes of non-cash working capital between periods, Standardized Distributable Cash Flow has the potential to be volatile between periods compared to DirectCash's existing measure of Distributable Cash Flow, which is calculated as cash flow from operations excluding the impact of non-cash working capital changes less productive capital maintenance requirements (see discussion below). In order to reconcile the two measures, DirectCash has calculated Standardized Distributable Cash Flow and reconciled it to Distributable Cash Flow.

Distributable cash flow and distributable cash flow per unit

Distributable cash flow and distributable cash flow per unit are non-GAAP measures generally used by Canadian open-ended income funds as an indicator of financial performance. Readers are cautioned that distributable cash flow is not a defined performance measure under GAAP and that distributable cash flow cannot be assured. DirectCash calculates distributable cash flow as equal to the consolidated funds flow from operations before changes in non-cash working capital, after provision for productive capital maintenance capital expenditures (see discussion below). DirectCash's distributable cash flow and distributable cash flow per unit may differ from similar computations as reported by other issuers and, accordingly, may not be comparable to distributable cash flow and distributable cash flow per unit as reported by such issuers.

Unitholders receive cash distributions sourced from distributions made by DirectCash LP indirectly to the Fund. DirectCash Group's policy is to distribute, to the maximum extent possible, the cash earned from operations to Unitholders, less amounts estimated to be required for expenses, productive capital maintenance, cash redemptions or repurchases of Units, any current tax liability, or other obligations, debt repayments and any reasonable reserves established. The Fund makes monthly cash distributions to Unitholders on the last business day of each month to Unitholders of record on the last business day of the preceding month.

Since August 2006, monthly distributions have been paid at $0.115 per Unit per month ($1.38 per Unit annualized). Distributions are funded from cash flows generated by the operation of the business.

Productive capital maintenance expenditures

DirectCash differentiates capital expenditures between growth and productive capital maintenance ("Maintenance Capital"). There is no such distinction under GAAP. However, DirectCash believes it is important to differentiate between them as maintenance capital expenditures represent a discretionary adjustment to distributable cash flow while growth capital does not.

Maintenance capital expenditures are defined as expenditures required to service and maintain DirectCash's existing productive capacity, while growth capital is expended to increase DirectCash's productive capacity by adding additional sources of revenue not currently in existence. Current measures of productive capacity that DirectCash utilizes include ATMs and debit terminals under contract (see "Operational Highlights"), Software and hardware upgrades to existing infrastructure, ATM and debit terminal equipment upgrades necessary to meet changing regulatory requirements, contract extension incentives, and fleet vehicle purchases and upgrades, are some examples of maintenance capital expenditures.

Examples of growth capital expenditures include the acquisition of a competitor's assets, the cost of an ATM in a new location, or technology costs related to new sources of revenue.

Readers are cautioned that productive capital maintenance expenditure is not a defined performance measure under GAAP. DirectCash's computation of productive maintenance capital expenditure may differ from similar computations as reported by other issuers and, accordingly, may not be comparable to maintenance capital expenditures as reported by such issuers.

Non-cash working capital

Non-cash working capital is not a defined GAAP measure. DirectCash calculates non-cash working capital as current assets less current liabilities, but excluding cash and credit facilities. A summary of this calculation is contained in the MD&A.

Forward-looking Statements

This Press Release contains certain forward-looking statements relating to future events. Forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond DirectCash's ability to control, including the impact to DirectCash's business, general economic conditions, consumer spending, borrowing trends and regulatory changes to name a few. Certain statements that contain words such as "could", "believe", "expects", "expected", "will", "intends", "projects", "anticipates", "estimates", "continues" or similar words relating to matters that are not historical facts constitute "forward-looking information" within the meaning of applicable Canadian securities legislation. In particular, forward-looking information and statements contained in this Press Release include statements related to DirectCash's projected growth in Canada and Mexico in the ATM business, projected growth in the prepaid and debit terminal business, accretive acquisitions on a go forward basis, expansion of DirectCash's merchant base through new and innovative products, entry into new geographic markets, ability to continue to acquire long-term recurring services contracts and expected increase in capital expenditures due to regulatory mandated security upgrade changes are all statements that have been stated or referred to throughout this Press Release. Readers are cautioned that actual results may vary from the forward-looking information provided.

Additional information about the Fund is available on SEDAR (www.sedar.com) or the Fund's website at www.directcash.net.

SOURCE DIRECTCASH INCOME FUND

For further information: For further information: The officer who may be contacted for further information is: Hendrik J. Lombard, C.F.O., DirectCash Management Inc., Manager of DirectCash Income Fund, Bay No. 6, 1420 - 28th Street N.E., Calgary, Alberta, T2A 7W6, Direct Telephone: (403) 387-2103, Fax: (403) 451-3003, E-mail: hlombard@directcash.net

Organization Profile

DIRECTCASH INCOME FUND

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