Redbox 2004 Annual Report Download - page 5

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PART I
Special Note Regarding Forward-Looking Statements
This annual report on Form 10-K contains forward-looking statements. These statements relate to future events or our
future financial performance. In some cases, you can identify forward-looking statements by terminology such as
“anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “potential,” “predict,”
“should” or “will,” or the negative of such terms, or other comparable terminology. These statements are only predictions and
involve known and unknown risks, uncertainties and other factors, including the risks outlined under “Factors that May
Affect our Business, Future Operating Results and Financial Condition” and elsewhere in this report, that may cause our or
our industry’s actual results, performance or achievements to be materially different from any future results, performance or
achievements expressed or implied by the forward-looking statements. Particular attention should also be paid to the
cautionary language in those sections of this annual report captioned: Item 1: Business; Item 3: Legal Proceedings; Item 7:
Management’s Discussion and Analysis of Financial Condition and Results of Operation; and Item 7A: Quantitative and
Qualitative Disclosures About Market Risk. You should not place undue reliance on these forward-looking statements.
Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee
future results, performance or achievements. We undertake no obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events or otherwise, unless required by law.
Item 1. Business.
The following discussion about our business includes forward-looking statements. Actual results could differ from
those projected in the forward-looking statements. Please refer to “Special Note Regarding Forward-Looking Statements” at
the beginning of this annual report.
Summary
We are the leader in the self-service coin-counting services market. We own and operate the only multi-national fully
automated network of self-service coin-counting machines across the United States, in Canada and in the United Kingdom.
We believe we are the leading owner and operator of skill-crane machines and bulk vending machines in the United States.
We refer to these services collectively as entertainment services. We also offer a range of electronic payment (“e-payment”)
services such as stored value cards, payroll cards, prepaid MasterCard
®
cards and prepaid wireless products at point-of-sale
terminals, stand-alone e-payment kiosks and e-payment enabled coin-counting machines in drugstores, universities, shopping
malls, supermarkets and convenience stores in the United States and the United Kingdom.
We launched our business in North America with the installation of the first Coinstar coin-counting machine in the
early 1990s, and in 2001 we began our commercial rollout of coin services in the United Kingdom. Since inception, our coin-
counting machines have counted and processed more than 210 billion coins worth more than $10.5 billion in more than 300
million self-service coin-counting transactions. We now own and operate more than 12,000 coin-counting machines in the
United States, Canada and United Kingdom and more than 171,000 entertainment services machines in the United States and
Mexico. We also utilize more than 15,000 point-of-sale terminals and own and operate approximately 150 stand-alone e-
payment kiosks for e-payment services in the United States and the United Kingdom. In addition, approximately 2,450 of our
12,000 coin-counting machines are e-payment enabled.
Our mid-year acquisition of ACMI Holdings, Inc. and its subsidiaries (collectively referred to as “ACMI”) and the
continued growth of our e-payment services has significantly broadened our base of existing and potential retail partners and
the depth and reach of our sales and field service forces, thereby greatly expanding the opportunity to cross-sell our coin,
entertainment and e-payment services. For example, we can now offer entertainment services to traditionally coin services-
only retail partners, such as supermarkets, and offer coin services to traditionally entertainment services-only retailers, such
as mass merchandisers and warehouse clubs. We also believe we have expanded opportunities to cross-sell our e-payment
services. We now have more than 1,200 field service employees throughout the United States and internationally, which have
expanded our geographic reach to develop and maintain strong relationships with new and existing retail partners. With the
combination of coin, entertainment and e-payment services, we are positioned as a single-source supplier for retailers to
capitalize on their front-of-store space, an area that generally has not been managed to optimize revenue per square foot.
We are headquartered in Bellevue, Washington, where we maintain most of our sales, marketing, research and
development, testing and customer service operations and administration. In addition, our main entertainment services office
is located in Louisville, Colorado. As of December 31, 2004, we had 1,694 employees of which 35 are members of labor
unions or are covered by a collective bargaining contract. We believe our employee relations are good as well as our relations
with the unions representing our employees. We were incorporated in Delaware on October 12, 1993.