Concentration Risk

12 Months Ended

Dec. 31, 2011

Concentration Risk [Abstract]

Concentration Risk

(19)  Concentration Risk

Significant Supplier.  For the years ended December 31, 2011 and 2010, the Company's domestic and United Kingdom operations purchased equipment from one supplier that accounted for 73.9% and 62.4%, respectively, of the Company's total ATM purchases for the years. As of December 31, 2011 and 2010, accounts payable to this supplier for ATM purchases represented approximately 30.4% and 2.6%, respectively, of the Company's consolidated accounts payable balances. In Mexico, for the year ended December 31, 2010, the Company purchased equipment from one supplier that accounted for 7.9% of the Company's total ATM purchases for that year. The accounts payable to this supplier was immaterial as of December 31, 2010. The Company did not purchase any ATMs in Mexico during 2011.

Significant Vendors. The Company obtains the cash to fill a substantial portion of its domestic Company-owned, and, in some cases, merchant-owned, ATMs from Bank of America and Wells Fargo. As of December 31, 2011, the Company had $1.7 billion in cash in its domestic ATMs, of which 42.0% was provided by Bank of America and 40.4% was provided by Wells Fargo. The Company's existing vault cash rental agreements expire at various times from March 2012 to December 2016. However, each provider has the right to demand the return of all or any portion of its cash at any time upon the occurrence of certain events beyond the Company's control, including certain bankruptcy events of the Company or its subsidiaries, or a breach of the terms of the Company's cash provider agreements. Other key terms of the agreements include the requirement that the cash providers provide written notice of their intent not to renew. Such notice provisions typically require a minimum of 180 to 360 days' notice prior to the actual termination date. If such notice is not received, then the contracts will typically automatically renew for an additional one-year period. Additionally, the Company's contract with one of its vault cash providers contains a provision that allows the provider to modify the pricing terms contained within the agreement at any time with 90 days prior written notice. However, in the event both parties do not agree to the pricing modifications, then either party may provide 180 days prior written notice of its intent to terminate. In the United Kingdom, the Company obtains all of its vault cash from a single provider, which is currently operating under a month-to-month contract while it is in the process of being renewed.

In addition to the above, the Company had concentration risks in significant vendors for the provision of on-site maintenance services and armored courier services in the United States for the years ended December 31, 2011 and 2010.

Significant Customers.  For the years ended December 31, 2011 and 2010, the Company derived 50.2% and 53.8%, respectively, of its total revenues from ATMs placed at the locations of its five largest merchants. For the years ended December 31, 2011 and 2010, the Company's top five merchants (based on its total revenues) were 7-Eleven, CVS, Walgreens, Martin McColl (in the United Kingdom), and Target. 7-Eleven, which represents the single largest merchant customer in Cardtronics' portfolio, comprised 30.9% and 34.0% of the Company's total revenues for the years ended December 31, 2011 and 2010, respectively. Accordingly, a significant percentage of the Company's future revenues and operating income will be dependent upon the successful continuation of its relationship with 7-Eleven and these other merchants.