InnerWorkings Announces First Quarter 2013 Results
Results Impacted by Previously Announced Spending Reduction from Large Customer; New Organic Enterprise Business Continues to Fuel Growth
Quarterly Highlights:
-
Revenue was
$204.3 million , compared to$188.5 million in the first quarter of 2012. -
Non-GAAP Adjusted EBITDA was
$5.8 million , compared to Non-GAAP Adjusted EBITDA of$9.6 million in the first quarter of 2012. Please refer to the non-GAAP reconciliation table below for more information. -
GAAP diluted earnings per share were
$0.02 , compared to GAAP diluted earnings per share of$0.07 in the first quarter of 2012. -
Non-GAAP Adjusted Operating Cash Flow was
$6.4 million , compared to Non-GAAP Adjusted Operating Cash Outflow of$3.3 million in the first quarter of 2012. Please refer to the non-GAAP reconciliation table below for more information. -
New organic enterprise account growth was
$18.1 million in the first quarter.
"Our team is excited about our global enterprise opportunity," said
Additional first quarter 2013 financial and operational highlights include the following:
- The enterprise channel accounted for 79% of revenue and middle market accounted for 21%, consistent with the revenue mix in the first quarter of 2012.
- Gross profit margin was 22.5%, compared to 22.0% in the prior year period.
-
DB Studios , aCalifornia -based distributor of permanent point-of-purchase displays was acquired inMarch 2013 .DB Studios is expected to generate revenues of approximately$20 million during the period from acquisition date to the end of the year.
"While we continue to realize solid new enterprise growth, we are
disappointed by our modest growth in the first quarter due to a decrease
in a large customer's spending," said
Revenue Growth - Comparing 2013 to 2012 | ||||||||
Q1 $(MM) Change | Q1 % Change | |||||||
New Enterprise Account Growth |
|
10% | ||||||
New Middle Market Growth |
|
1% | ||||||
Same Customer Spend |
( |
-3% | ||||||
Acquisitive Growth |
|
1% | ||||||
Total Revenue Growth |
|
8% | ||||||
Total Organic Revenue Growth |
|
7% | ||||||
Outlook
The Company reaffirms its recently revised 2013 revenue and EPS
guidance. 2013 revenue guidance of
Conference Call
A conference call to discuss the Company's first quarter 2013 results
will be broadcast live on
To access the conference call by telephone, interested parties may dial
(877) 771-7024. Interested parties are also invited to listen to the
live webcast by visiting the Investor "Events & Presentations" section
of
About
For more information visit: www.inwk.com.
Non-GAAP Financial Measures
This press release includes the following financial measures defined as
a "non-GAAP financial measures" by the
Forward-Looking Statements
This release contains statements relating to future results. These
statements are forward-looking statements under the federal securities
laws. We can give no assurance that any future results discussed in
these statements will be achieved. Any forward-looking statements
represent our views only as of today and should not be relied upon as
representing our views as of any subsequent date. These statements are
subject to a variety of risks and uncertainties that could cause our
actual results to differ materially from the statements contained in
this release. For a discussion of important factors that could affect
our actual results, please refer to our
Consolidated Statements of Income | |||||||||
Three Months Ended |
|||||||||
2012 | 2013 | ||||||||
Revenue | $ | 188,546,402 | $ | 204,316,125 | |||||
Cost of goods sold | 147,153,019 | 158,323,630 | |||||||
Gross profit | 41,393,383 | 45,992,495 | |||||||
Operating expenses: | |||||||||
Selling, general and administrative expenses | 33,083,264 | 41,735,789 | |||||||
Depreciation and amortization | 2,444,096 | 2,465,667 | |||||||
Income from operations | 5,866,023 | 1,791,039 | |||||||
Total other expense | (260,388 | ) | (923,936 | ) | |||||
Income before income taxes | 5,605,635 | 867,103 | |||||||
Income tax expense | 1,917,947 | (28,027 | ) | ||||||
Net income | $ | 3,687,688 | $ | 895,130 | |||||
Basic earnings per share | $ | 0.08 | $ | 0.02 | |||||
Diluted earnings per share | $ | 0.07 | $ | 0.02 | |||||
Weighted average shares outstanding, basic | 47,193,327 | 50,338,994 | |||||||
Weighted average shares outstanding, diluted | 50,013,569 | 52,006,801 | |||||||
Consolidated Balance Sheets | ||||||
|
|
|||||
2012 | 2013 | |||||
Cash and cash equivalents | $ | 17,218,899 | $ | 10,609,171 | ||
Accounts receivable, net of allowance for doubtful accounts | 149,246,568 | 150,492,103 | ||||
Unbilled revenue | 30,798,230 | 30,191,086 | ||||
Inventories | 17,406,863 | 15,310,762 | ||||
Prepaid expenses | 16,210,053 | 19,880,172 | ||||
Other current assets | 22,565,321 | 22,456,346 | ||||
Total long-term assets | 268,797,648 | 309,247,680 | ||||
Total assets | $ | 522,243,582 | $ | 558,187,320 | ||
Accounts payable-trade | $ | 121,132,051 | $ | 126,701,960 | ||
Other current liabilities | 44,262,065 | 49,223,149 | ||||
Revolving credit facility | 65,000,000 | 70,500,000 | ||||
Other long-term liabilities | 68,870,021 | 84,196,997 | ||||
Total stockholders' equity | 222,979,445 | 227,565,214 | ||||
Total liabilities and stockholders' equity | $ | 522,243,582 | $ | 558,187,320 | ||
|
||||||||
Three Months Ended |
||||||||
2012 | 2013 | |||||||
Net cash provided by (used in) operating activities |
$ | (7,472,638 | ) | $ | 4,552,380 | |||
Net cash used in investing activities | (3,189,117 | ) | (9,148,187 | ) | ||||
Net cash provided by (used in) financing activities |
12,886,424 | (1,854,875 | ) | |||||
Effect of exchange rate changes on cash and cash equivalents | 221,918 | (159,046 | ) | |||||
Increase (decrease) in cash and cash equivalents |
2,446,587 | (6,609,728 | ) | |||||
Cash and cash equivalents, beginning of period | 13,219,385 | 17,218,899 | ||||||
Cash and cash equivalents, end of period | $ | 15,665,972 | $ | 10,609,171 | ||||
Reconciliation of Adjusted EBITDA and Adjusted Operating Cash Flows |
|||||||
Three Months Ended |
|||||||
2012 | 2013 | ||||||
Operating income | $ | 5,866,023 | $ | 1,791,039 | |||
Depreciation and amortization | 2,444,096 | 2,465,667 | |||||
Stock-based compensation expense | 1,047,645 | 973,193 | |||||
Change in fair value of contingent consideration | 200,141 | 608,832 | |||||
Adjusted EBITDA | $ | 9,557,905 | $ | 5,838,731 | |||
Three Months Ended |
|||||||
2012 | 2013 | ||||||
Net cash provided by (used in) operating activities |
$ | (7,472,638 | ) | $ | 4,552,380 | ||
Excess tax benefit from exercise of stock awards * | 4,163,793 | 951,066 | |||||
Cash paid for settlement of preference claim | - | 900,000 | |||||
Adjusted net cash provided by (used in) operating activities |
$ | (3,308,845 | ) | $ | 6,403,446 |
* Represents a U.S. tax deduction in an amount equal to the excess of the market price of the stock on the date of exercise over exercise price.
bmoore@inwk.com
Source:
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