Despite a 13.3% increase in payment-processing revenue, Newtek Business Services Inc. posted a third-quarter net loss of $342,000, the payment-services company announced Nov. 10. The company reported net income of $145,000 for the same quarter last year.
Payment processing, one of various services Newtek offers, earned $20.5 million in revenue during the quarter, up 13.3% from the $18.1 million a year earlier. Total company revenue rose 9%, to $29.2 million from $26.8 million. Payment-processing revenue grew primarily from “a combination of growth in our merchant accounts and an increase of our processing volume per merchant,” Seth Cohen, Newtek chief financial officer, told analysts during a Nov. 10 conference call to discuss earnings.
Indeed, the ailing economy has affected Newtek’s business, but the company’s payment-processing business is growing by adding new and larger merchant customers, Barry Sloane, Newtek CEO, told analysts.
New York-based Newtek also offers Web-hosting services, Small Business Administration-guaranteed loans and insurance. The company expects to make a strong push into the small-business market with the January launch of thesba.com, a website it will use to further cross-sell its bevy of products to merchant customers, Sloane says.