Business description and basis of presentation

12 Months Ended

Dec. 31, 2012

Business description and basis of presentation

Business description and basis of presentation

1. Business description and basis of presentation

Business description

Planet Payment, Inc. together with its wholly owned subsidiaries (“Planet Payment,” the “Company,” “we,” or “our”) is a provider of international payment processing and multi-currency processing services. The Company provides its services to approximately 41,000 active merchant locations in more than 20 countries and territories across the Asia Pacific region, North America, the Middle East, Africa and Europe, primarily through its acquiring bank and processor customers, as well as through its own direct sales force. The Company’s point-of-sale and e-commerce services are integrated within the payment card transaction flow and enable its acquiring customers to process and reconcile payment transactions in multiple currencies, geographies and channels. The Company is a registered third party processor with the major card associations and operates in accordance with industry standards, including the Payment Card Industry, or PCI, Security Council’s Data Security Standards.

Company structure

Planet Payment was incorporated in the State of Delaware on October 12, 1999 as Planet Group Inc. and changed its name to Planet Payment, Inc. on June 18, 2007.

Since March 20, 2006, shares of the Company’s common stock have traded on the Alternative Investment Market of the London Stock Exchange, or AIM, under the symbols “PPT” and “PPTR.”  From November 19, 2008 until December 14, 2012, shares of our common stock were traded on the OTCQX under the symbol “PLPM.”  On December 17, 2012 shares of our common stock began trading on NASDAQ under the symbol “PLPM.”

Basis of presentation

The consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”).

The accompanying consolidated financial statements include the accounts of Planet Payment, Inc. and its wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated.

In October 2012, the east coast of the United States was hit by Hurricane Sandy, including the city of Long Beach, where the Company’s corporate offices are located.  The aftermath of this event caused temporary disruption to certain functions undertaken at that office and caused the Company to incur additional costs for repairs, temporary office space and other requirements to maintain or re-establish these functions.  While the Company insures against such property damage and business interruption risks, such insurance may not adequately compensate the Company for losses incurred.  For the year ended December 31, 2012 the Company recorded a selling, general and administration expense of $0.1 million primarily related to disposal of property and equipment that was damaged in the hurricane which was offset by a pre-funding insurance reimbursement of $0.1 million.  Based on the information available we estimate that the future impact of such losses to be approximately $0.1 million.  At no time were any of the Company’s transaction processing functions or systems affected by the storm and accordingly none of the Company’s customers suffered any loss of transactions.