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Coinstar, Inc. Announces 2010 Second Quarter Results

Company Raises Guidance after Reporting 35% Revenue Growth from Continuing Operations; E-payment and Money Transfer Businesses Reported as Discontinued Operations

Coinstar, Inc. today announced financial results for the second quarter and six months ended June 30, 2010, which reflect its E-payment and Money Transfer businesses as discontinued operations.

"We are very pleased with our second quarter results and the performance of our core businesses," said Paul Davis, chief executive officer of Coinstar, Inc. "We continue to have great momentum in our DVD business as demonstrated by our increasing market share and expanding relationships with key partners. Our Coin business is showing impressive growth in same store sales, and our outlook for the remainder of 2010 is positive as we continue to execute on our automated retail strategy."

  Second quarter financial highlights included:




  --Revenue                                                 $ 342.4  million
  --Income from operations                                  $  29.3  million
  --Adjusted EBITDA from continuing operations
     (See Appendix A)                                       $  65.5  million
  --Diluted earnings per share from continuing
     operations                                             $  0.39
  --Diluted earnings per share attributable to
     Coinstar, Inc.                                         $  0.41
  --Net cash provided by operating activities from
     continuing operations                                  $ 104.7  million
  --Free cash flow from continuing operations
     (See Appendix A)                                       $  51.8  million

"With the sale of our E-payment business and the decision to dispose of Money Transfer, we are better positioned to build on the solid operating performance of our DVD and Coin businesses and have raised our guidance for 2010," said J. Scott Di Valerio, chief financial officer of Coinstar, Inc. "We will continue to focus on consumers and partners while making investments to drive profitable growth."

Revenue for the second quarter of 2010 increased 34.9% to $342.4 million compared with the second quarter of 2009, driven primarily by growth in DVD revenue, which increased 43.9% to $271.9 million, and by Coin revenue which grew 8.5% to $70.4 million.

Income from operations for the second quarter of 2010 was $29.3 million, which resulted in an operating margin of 8.6%, including a pre-tax charge of approximately $2.0 million in accelerated depreciation related to the company's decision to exit the DVDXpress-branded business and $2.2 million in share-based payments expense related to the company's agreements with Sony Pictures Home Entertainment and Paramount Home Entertainment Inc. This compares with income from operations of $25.8 million and an operating margin of 10.2% in the second quarter of 2009.

Income from continuing operations for the second quarter of 2010 was $12.8 million, or diluted earnings per share of $0.39, including the accelerated depreciation and share-based payments expense reflected in income from operations as well as 2.4 million additional shares outstanding, compared with $10.5 million, or $0.35, in the second quarter of 2009.

In the second quarter, Coinstar completed the sale of its E-payment business and committed to a formal plan to sell its Money Transfer business and, as a result, the second quarter and all prior periods have been adjusted to reflect these businesses as discontinued operations. Coinstar recorded income from discontinued operations of $0.5 million, or earnings per diluted share of $0.02, in the second quarter, which included a gain, net of tax, on the sale of the E-payment business and an anticipated loss, net of tax, upon disposal of the Money Transfer business.

Net income attributable to Coinstar, Inc. for the second quarter of 2010, which includes both continuing and discontinued operations, was $13.4 million, or diluted earnings per share of $0.41, compared with $7.0 million, or diluted earnings per share of $0.23, in the second quarter of 2009.

Revenue for the first six months of 2010 was $665.5 million, an increase of 42.6% compared with the first six months of 2009. Income from operations for the first six months of 2010 was $53.9 million, which resulted in an operating margin of 8.1%, compared with income from operations of $46.3 million and an operating margin of 9.9% in the first six months of 2009. Net income attributable to Coinstar, Inc. for the first six months of 2010 was $19.8 million, or $0.62 per diluted share compared with net income of $8.9 million, or $0.30 per share, in the first six months of 2009, which included a loss of $3.6 million attributable to non-controlling interests.

Cash paid for capital expenditures for continuing operations for the second quarter of 2010 was $52.8 million, compared with $38.3 million in the second quarter of 2009, with the increase primarily due to increased investment in redbox® DVD kiosks as well as investment in infrastructure. Free cash flow from continuing operations for the second quarter of 2010 was $51.8 million, compared with negative $5.3 million in the second quarter of 2009.

2010 Third Quarter and Full Year Guidance

For the 2010 full year, Coinstar management raised guidance provided on May 26 after adjusting for the reclassification of Money Transfer as discontinued operations and now expects:

  --  Revenue between $1.425 billion and $1.505 billion;
  --  EBITDA between $275 million and $290 million;
  --  GAAP EPS from continuing operations between $1.88 and $2.00 on a fully
      diluted basis;
  --  Free cash flow from continuing operations between $80 million and $100
      million.


  For the 2010 third quarter, Coinstar management expects:
  --  Revenue between $370 million and $390 million;
  --  EBITDA between $69 million and $74 million;
  --  GAAP EPS from continuing operations between $0.46 and $0.52 on a fully
      diluted basis.


  Conference Call

Paul Davis and J. Scott Di Valerio will host a conference call today at 2:00 p.m. PDT (5:00 p.m. EDT) to review the second quarter results and discuss guidance. The conference call will be webcast live and archived on the Investor Relations section of Coinstar's website at www.coinstar.com. A recording of the call will be available approximately two hours after the call ends through August 13, 2010, at 1-888-286-8010 or 1-617-801-6888, passcode 11131953.

About Coinstar, Inc.

Coinstar, Inc. is a leading provider of automated retail solutions offering convenient services that make life easier for consumers and drive incremental traffic and revenue for retailers. The company's core automated retail businesses include the well-known redbox® self-service DVD rental and Coinstar® self-service coin-counting brands. The company has approximately 26,900 DVD kiosks and 19,000 coin-counting kiosks in supermarkets, drug stores, mass merchants, financial institutions, convenience stores, and restaurants. For more information, visit www.coinstar.com.

Safe Harbor for Forward-Looking Statements

Certain statements in this press release are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. The words "believe," "estimate," "expect," "intend," "anticipate," "goals," variations of such words, and similar expressions identify forward-looking statements, but their absence does not mean that the statement is not forward-looking. The forward-looking statements in this release include statements regarding Coinstar, Inc.'s anticipated growth and future operating results. Forward-looking statements are not guarantees of future performance and actual results may vary materially from the results expressed or implied in such statements. Differences may result from actions taken by Coinstar, Inc., as well as from risks and uncertainties beyond Coinstar, Inc.'s control. Such risks and uncertainties include, but are not limited to, the termination, non-renewal or renegotiation on materially adverse terms of our contracts with our significant retailers, payment of increased service fees to retailers, the inability to receive delivery of DVDs on the date of their initial release to the general public, or shortly thereafter, for home entertainment viewing, the effective management of our DVD inventory, the ability to attract new retailers, penetrate new markets and distribution channels and react to changing consumer demands, the ability to achieve the strategic and financial objectives for our entry into or expansion of new businesses, the ability to adequately protect our intellectual property, and the application of substantial federal, state, local and foreign laws and regulations specific to our business. The foregoing list of risks and uncertainties is illustrative, but by no means exhaustive. For more information on factors that may affect future performance, please review "Risk Factors" described in our most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission. These forward-looking statements reflect Coinstar, Inc.'s expectations as of the date of this release. Coinstar, Inc. undertakes no obligation to update the information provided herein.

  (Financial Statements Follow)

  Appendix A

  Use of Non-GAAP Financial Measures

Non-GAAP measures may be provided as a complement to results provided in accordance with United States generally accepted accounting principles ("GAAP"). Non-GAAP measures are not a substitute for measures computed in accordance with GAAP. The definitions of such non-GAAP measures are provided below to allow the reader to reconcile non-GAAP data to that presented in accordance with GAAP. Our non-GAAP measures may be different from the presentation of financial information by other companies.

Adjusted EBITDA from continuing operations is defined as earnings before net interest expense, income taxes, depreciation, amortization and certain other non-cash charges including the write-off from early retirement of debt, goodwill impairment, and stock-based compensation and share-based expenses from continuing operations. We believe adjusted EBITDA from continuing operations is an important non-GAAP measure as it provides useful information to investors regarding our ability to service, incur or pay down indebtedness. In addition, management uses this non-GAAP measure internally to evaluate performance and manage operations. See below for reconciliation of the most comparable GAAP measure, income from continuing operations, to adjusted EBITDA from continuing operations.

                              Three Months                Six Months
                            Ended June 30,              Ended June 30,
                            --------------              --------------
                           2010         2009           2010          2009
                           ----         ----           ----          ----
                                         (in thousands)

   Income from
    continuing
    operations          $12,841      $10,530        $22,080       $20,431
   Depreciation,
    amortization and
    other                31,612       22,175         64,292        42,325
   Interest expense,
    net                   9,073        8,611         18,339        15,077
   Income taxes           7,389        6,702         13,395        10,729
   Stock-based
    compensation and
    share-based
    expense               4,570        1,942          7,787         4,737
   Adjusted EBITDA from
    continuing
    operations          $65,485      $49,960       $125,893       $93,299
                        =======      =======       ========       =======



Free cash flow from continuing operations is defined as net cash provided by operating activities from continuing operations after cash paid for capital expenditures for continuing operations. We believe free cash flow is an important non-GAAP measure as it provides useful cash flow information regarding our ability to service, incur or pay down indebtedness and repurchase our common stock. See below for reconciliation of the most comparable GAAP measure, net cash provided by operating activities from continuing operations, to free cash flow from continuing operations.

                          Three Months                   Six Months
                         Ended June 30,               Ended June 30,
                         --------------               --------------
                        2010           2009          2010           2009
                        ----           ----          ----           ----
                                       (in thousands)

   Net cash
    provided by
    operating
    activities from
    continuing
    operations      $104,651     $32,965   $157,381     $19,760
   Purchase of
    property and
    equipment       (52,822)        (38,288)     (84,339)        (73,276)
   Free cash flow
    from continuing
    operations       $51,829        $(5,323)      $73,042       $(53,516)
                     =======        =======       =======       ========



                                           Coinstar, Inc.
                                Consolidated Statements of Net Income
                                (in thousands, except per share data)
                                             (unaudited)

                                                   Three Months Ended
                                                        June 30,
                                                        --------
                                                    2010          2009
                                                     ---           ---

  REVENUE                                       $342,356      $253,844
  EXPENSES:
      Direct operating                           241,796       174,871
      Marketing                                    5,934         3,696
      Research and development                     1,805         1,299
      General and administrative                  31,876        25,977
      Depreciation and other                      30,627        21,293
      Amortization of intangible assets              985           882
      Litigation settlement                            0             0
       Income from operations                     29,333        25,826
  OTHER INCOME (EXPENSE):
      Foreign currency (loss) gain and other,
       net                                           (30)           17
      Interest income                                 85             4
      Interest expense                            (9,158)       (8,615)
       Income from continuing operations before
        income taxes                              20,230        17,232
      Income tax expense                          (7,389)       (6,702)
                                                  ------        ------
  Income from continuing operations               12,841        10,530
  Income (loss) from discontinued
   operations, net of tax                            526        (3,572)
                                                     ---        ------
  Net income                                      13,367         6,958
      Less: Net income attributable to non-
       controlling interests                           0             0
  NET INCOME ATTRIBUTABLE TO COINSTAR, INC.      $13,367        $6,958
                                                 =======        ======


  BASIC EARNINGS PER SHARE:
  Basic earnings per share from continuing
   operations attributable to Coinstar,
   Inc.                                            $0.40         $0.35
  Basic earnings (loss) per share from
   discontinued operations attributable to
   Coinstar, Inc.                                   0.02         (0.12)
                                                    ----         -----
      Basic earnings per share attributable to
       Coinstar, Inc.                              $0.42         $0.23
                                                   =====         =====

  DILUTED EARNINGS PER SHARE:
  Diluted earnings per share from
   continuing operations attributable to
   Coinstar, Inc.                                  $0.39         $0.35
  Diluted earnings (loss) per share from
   discontinued operations attributable to
   Coinstar, Inc.                                   0.02         (0.12)
                                                    ----         -----
      Diluted earnings per share attributable
       to Coinstar, Inc.                           $0.41         $0.23
                                                   =====         =====

  WEIGHTED SHARES OUTSTANDING:
      Basic                                       31,731        30,117
      Diluted                                     32,938        30,575





                                                    Six Months Ended
                                                        June 30,
                                                        --------
                                                    2010          2009
                                                     ---           ---

  REVENUE                                       $665,478      $466,597
  EXPENSES:
      Direct operating                           466,755       318,401
      Marketing                                    8,564         6,683
      Research and development                     3,229         2,556
      General and administrative                  63,398        50,364
      Depreciation and other                      62,428        40,569
      Amortization of intangible assets            1,864         1,756
      Litigation settlement                        5,379             0
       Income from operations                     53,861        46,268
  OTHER INCOME (EXPENSE):
      Foreign currency (loss) gain and other,
       net                                           (47)          (31)
      Interest income                                 87            36
      Interest expense                          (18,426)      (15,113)
       Income from continuing operations before
        income taxes                              35,475        31,160
      Income tax expense                        (13,395)      (10,729)
                                                 -------       -------
  Income from continuing operations               22,080        20,431
  Income (loss) from discontinued
   operations, net of tax                         (2,271)       (7,883)
                                                  ------        ------
  Net income                                      19,809        12,548
      Less: Net income attributable to non-
       controlling interests                           0        (3,627)
  NET INCOME ATTRIBUTABLE TO COINSTAR, INC.      $19,809        $8,921
                                                 =======        ======


  BASIC EARNINGS PER SHARE:
  Basic earnings per share from continuing
   operations attributable to Coinstar,
   Inc.                                            $0.70         $0.57
  Basic earnings (loss) per share from
   discontinued operations attributable to
   Coinstar, Inc.                                  (0.07)        (0.27)
                                                   -----         -----
      Basic earnings per share attributable to
       Coinstar, Inc.                              $0.63         $0.30
                                                   =====         =====

  DILUTED EARNINGS PER SHARE:
  Diluted earnings per share from
   continuing operations attributable to
   Coinstar, Inc.                                  $0.69         $0.56
  Diluted earnings (loss) per share from
   discontinued operations attributable to
   Coinstar, Inc.                                  (0.07)        (0.26)
                                                   -----         -----
      Diluted earnings per share attributable
       to Coinstar, Inc.                           $0.62         $0.30
                                                   =====         =====

  WEIGHTED SHARES OUTSTANDING:
      Basic                                       31,340        29,525
      Diluted                                     32,077        29,893



                                       Coinstar, Inc.
                                Consolidated Balance Sheets
                             (in thousands, except share data)
                                        (unaudited)

                                                  June 30,    December 31,
                                                        2010          2009
                                                        ----          ----

                            ASSETS
   CURRENT ASSETS:
       Cash and cash equivalents                    $132,607       $61,280
       Cash in machine or in transit                  48,401        57,141
       Cash being processed                           76,125        73,875
       Accounts receivable, net of allowance
        for doubtful accounts of $953 and
        $4,379
          at June 30, 2010 and December 31, 2009,
           respectively                               19,458        61,371
       DVD library and inventory                      87,328       104,367
       Deferred income taxes                          11,295        12,350
       Prepaid expenses and other current
        assets                                        19,413        20,364
       Assets of business held for sale               77,945             0
             Total current assets                    472,572       390,748
   PROPERTY AND EQUIPMENT, NET                       416,228       400,289
   DEFERRED INCOME TAXES                              90,731        99,195
   OTHER ASSETS                                       14,453        17,172
   INTANGIBLE ASSETS, NET                             11,013        30,893
   GOODWILL                                          267,750       284,502
   ASSETS OF BUSINESS HELD FOR SALE                   24,100             0
   TOTAL ASSETS                                   $1,296,847    $1,222,799
                                                  ==========    ==========

                    LIABILITIES AND EQUITY
   CURRENT LIABILITIES:
       Accounts payable                             $108,650      $118,918
       Accrued payable to retailers and agents        96,402       131,103
       Other accrued liabilities                     104,331        91,413
       Current portion of long-term debt               7,157         6,812
       Current portion of capital lease
        obligations                                   23,162        26,396
       Liabilities of business held for sale          59,309             0
             Total current liabilities               399,011       374,642
   LONG-TERM DEBT AND OTHER                          409,551       409,423
   CAPITAL LEASE OBLIGATIONS                          14,072        26,326
   DEFERRED TAX LIABILITY                                 17            17
   TOTAL LIABILITIES                                 822,651       810,408

   EQUITY:
       Preferred stock, $0.001 par
        value-Authorized, 5,000,000 shares; no
        shares issued
          and outstanding at June 30, 2010 and
           December 31, 2009                               0             0
       Common stock, $0.001 par
        value-Authorized: 60,000,000 shares at
        June 30, 2010 and
         45,000,000 at December 31, 2009;
          34,643,176 and 33,002,865 issued and
          32,717,095
          and 31,076,784 shares outstanding at
           June 30, 2010 and December 31, 2009,      448,955       406,333
             respectively
       Retained earnings                              70,780        50,971
       Treasury stock                                (40,831)      (40,831)
       Accumulated other comprehensive loss           (4,708)       (4,082)
             Total stockholders' equity              474,196       412,391
                                                     -------       -------
   TOTAL LIABILITIES AND EQUITY                   $1,296,847    $1,222,799
                                                  ==========    ==========



                                              Coinstar, Inc.
                                   Consolidated Statements of Cash Flows
                                              (in thousands)
                                                (unaudited)

                                                   Three Months Ended
                                                        June 30,
                                                        --------
                                                    2010           2009
                                                     ---            ---

  OPERATING ACTIVITIES:
  Net income                                     $13,367         $6,958
  Adjustments to reconcile net income
   to net cash provided by operating
   activities from continuing
   operations:
            Depreciation and other                30,627         21,293
            Amortization of intangible assets
             and deferred financing fees           1,493          1,202
            Non-cash stock-based compensation
             for employees                         2,339          1,942
            Share-based payments for DVD
             agreement                             2,231              0
            Excess tax benefit on share-based
             awards                               (5,477)           (92)
            Deferred income taxes                  5,607          2,747
            (Gain) loss from discontinued
             operations, net of tax                 (526)         3,572
            Non-cash interest on convertible
             debt                                  1,499              0
            Other                                     33           (106)
    Cash provided (used) by changes in
     operating assets and liabilities
     from continuing operations:                  53,458         (4,551)
        Net cash provided by operating
         activities from continuing
         operations                              104,651         32,965
  INVESTING ACTIVITIES:
            Purchase of property and equipment   (52,822)       (38,288)
            Proceeds from sale of electronic
             payment services business            26,078              0
            Proceeds from sale of property and
             equipment                               230             59
      Net cash used by investing
       activities from continuing
       operations                                (26,514)       (38,229)
  FINANCING ACTIVITIES:
            Principal payments on capital lease
             obligations and other debt          (10,668)        (5,858)
            Net borrowings on credit facility          0         18,000
            Borrowings on term loan                    0         87,500
            Financing costs associated with
             revolving line of credit and
             convertible debt                          0         (1,329)
            Cash used to purchase remaining
             non-controlling interests in
             Redbox                                    0        (92,270)
            Excess tax benefit on share-based
             awards                                5,477             92
            Proceeds from exercise of stock
             options                              25,023          1,841
      Net cash provided by financing
       activities from continuing
       operations                                 19,832          7,976

  Effect of exchange rate changes on
   cash                                             (354)         3,050

  NET INCREASE (DECREASE) IN CASH AND
   CASH EQUIVALENTS, CASH IN MACHINE
   OR IN TRANSIT,
    AND CASH BEING PROCESSED FROM
     CONTINUING OPERATIONS                        97,615          5,762

  CASH FLOWS FROM DISCONTINUED
   OPERATIONS:
            Operating cash flows                 (26,279)         6,840
            Investing cash flows                 (32,716)        (2,269)
            Financing cash flows                    (145)          (887)
                                                    ----           ----
                                                 (59,140)         3,684

  NET INCREASE (DECREASE) IN CASH AND
   CASH EQUIVALENTS, CASH IN
    MACHINE OR IN TRANSIT, AND CASH
     BEING PROCESSED                              38,475          9,446

  CASH AND CASH EQUIVALENTS, CASH IN
   MACHINE OR IN TRANSIT, AND CASH
   BEING PROCESSED:
            Beginning of period                  218,658        178,806
            End of period                       $257,133       $188,252
                                                ========       ========





                                                    Six Months Ended
                                                        June 30,
                                                        --------
                                                    2010           2009
                                                     ---            ---

  OPERATING ACTIVITIES:
  Net income                                     $19,809        $12,548
  Adjustments to reconcile net income
   to net cash provided by operating
   activities from continuing
   operations:
            Depreciation and other                62,428         40,569
            Amortization of intangible assets
             and deferred financing fees           2,880          2,262
            Non-cash stock-based compensation
             for employees                         4,964          4,737
            Share-based payments for DVD
             agreement                             2,823              0
            Excess tax benefit on share-based
             awards                               (6,225)          (125)
            Deferred income taxes                  8,755          4,489
            (Gain) loss from discontinued
             operations, net of tax                2,271          7,883
            Non-cash interest on convertible
             debt                                  2,958              0
            Other                                    229            126
    Cash provided (used) by changes in
     operating assets and liabilities
     from continuing operations:                  56,489        (52,729)
        Net cash provided by operating
         activities from continuing
         operations                              157,381         19,760
  INVESTING ACTIVITIES:
            Purchase of property and equipment   (84,339)       (73,276)
            Proceeds from sale of electronic
             payment services business            26,078              0
            Proceeds from sale of property and
             equipment                               267            152
      Net cash used by investing
       activities from continuing
       operations                                (57,994)       (73,124)
  FINANCING ACTIVITIES:
            Principal payments on capital lease
             obligations and other debt          (19,343)       (11,693)
            Net borrowings on credit facility          0         73,000
            Borrowings on term loan                    0         87,500
            Financing costs associated with
             revolving line of credit and
             convertible debt                          0         (3,234)
            Cash used to purchase remaining
             non-controlling interests in
             Redbox                                    0      (102,353)
            Excess tax benefit on share-based
             awards                                6,225            125
            Proceeds from exercise of stock
             options                              27,250          2,260
      Net cash provided by financing
       activities from continuing
       operations                                 14,132         45,605

  Effect of exchange rate changes on
   cash                                             (851)         2,829

  NET INCREASE (DECREASE) IN CASH AND
   CASH EQUIVALENTS, CASH IN MACHINE
   OR IN TRANSIT,
    AND CASH BEING PROCESSED FROM
     CONTINUING OPERATIONS                       112,668         (4,930)

  CASH FLOWS FROM DISCONTINUED
   OPERATIONS:
            Operating cash flows                 (14,115)         7,455
            Investing cash flows                 (33,550)        (4,486)
            Financing cash flows                    (166)        (1,822)
                                                    ----         ------
                                                 (47,831)         1,147

  NET INCREASE (DECREASE) IN CASH AND
   CASH EQUIVALENTS, CASH IN
    MACHINE OR IN TRANSIT, AND CASH
     BEING PROCESSED                              64,837         (3,783)

  CASH AND CASH EQUIVALENTS, CASH IN
   MACHINE OR IN TRANSIT, AND CASH
   BEING PROCESSED:
            Beginning of period                  192,296        192,035
            End of period                       $257,133       $188,252
                                                ========       ========





       Coinstar, Inc.
   Business Segment
      Information
    (in thousands)
      (unaudited)




At June 30, 2010, we reflected both the E-payment and Money Transfer businesses as discontinued operations for all periods presented. As a result, our business segments are now DVD services and Coin services. The operating costs related to continuing corporate activities have been reallocated to these two segments.

As a complement to our Consolidated Statements of Net Income, we are providing the following information related to our business segments:

                            Three Months                     Six Months
                           Ended June 30,                  Ended June 30,
                          2010           2009           2010           2009
                           ---            ---            ---            ---
                           (in thousands)                  (in thousands)
    Revenue:
      DVD services    $271,929       $188,925       $535,058       $343,622
      Coin services     70,427         64,919        130,420        122,975


    Consolidated
     revenue          $342,356       $253,844       $665,478       $466,597
                      ========       ========       ========       ========




                                                    Three Months
                                                   Ended June 30,
                                                  2010              2009
                                                   ---               ---
                                                   (in thousands)
  Operating income before depreciation/
   amortization and stock-based compensation/
   share-based payments:
      DVD services                             $39,049           $24,157
      Coin services                             26,466            25,786
             Subtotal                           65,515            49,943

      Depreciation, amortization and other     (31,612)          (22,175)

      Stock-based compensation and share-based
       payments                                 (4,570)           (1,942)


    Consolidated income from operations        $29,333           $25,826
                                               =======           =======





                                                     Six Months
                                                   Ended June 30,
                                                  2010              2009
                                                   ---               ---
                                                   (in thousands)
  Operating income before depreciation/
   amortization and stock-based compensation/
   share-based payments:
      DVD services                             $83,480           $45,056
      Coin services                             42,460            48,274
             Subtotal                          125,940            93,330

      Depreciation, amortization and other     (64,292)          (42,325)

      Stock-based compensation and share-based
       payments                                 (7,787)           (4,737)


    Consolidated income from operations        $53,861           $46,268
                                               =======           =======

First Call Analyst:
FCMN Contact:

SOURCE: Coinstar, Inc.

CONTACT: Media, Marci Maule, Director of Public Relations,
+1-425-943-8277, marci.maule@coinstar.com, or Investors, Rosemary Moothart,
Director of Investor Relations, +1-425-943-8140,
rosemary.moothart@coinstar.com, both of Coinstar, Inc.