PFSweb Reports Record Fourth Quarter and Full Year 2015 Results
Q4 Service Fee Equivalent Revenue up 26% to $61.6 Million; Adjusted EBITDA up 9% to $7.5 Million
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ALLEN, TX -- (Marketwired) -- 03/14/16 -- PFSweb, Inc. (NASDAQ: PFSW), a global commerce service provider, reported results for the fourth quarter and full year ended December 31, 2015.
Fourth Quarter 2015 Highlights vs. Same Year-Ago Quarter
- Total revenues increased 14% to $90.1 million
- Service fee equivalent revenue (a non-GAAP measure defined below) increased 26% to a record $61.6 million
- Service fee gross margin increased 340 basis points to 31.6%
- Adjusted EBITDA (a non-GAAP measure defined below) increased 9% to a Q4 record $7.5 million
- Launched a new strategic commerce consulting practice to drive digital strategy for clients
- Successfully concluded the 2015 holiday season with a high level of client satisfaction
- Continued to aggressively build out global sales organization to support targeted future growth
Management Commentary "2015 was a breakthrough year for PFSweb as we consistently achieved record quarterly results," said Michael Willoughby, CEO of PFSweb. "These results were driven by organic growth across all three of our core service offerings -- agency, technology and omni-channel operations -- and from the acquisitions of REV Solutions, LiveAreaLabs, Moda and CrossView. The fourth quarter was particularly strong due to heavy client volumes during the important holiday season, as well as increased project work in our higher-margin agency and technology services including the benefit of the CrossView acquisition completed in August 2015.
"During the fourth quarter, we launched our strategic commerce consulting practice, which provides high-value digital strategy and platform selection consulting to both B2B and B2C companies. Though we remain in the early stages of realizing the full benefits, we've already begun to leverage the services and insight from this practice to enhance our position and monetize earlier stages of the sales cycle.
"In 2016, we will continue to focus on driving growth through higher-margin service offerings, while serving as a strategic partner to our clients. We plan to continue leveraging the added platform and B2B capabilities from our CrossView acquisition to capitalize on a larger, more rapidly growing addressable market, with the ultimate goal of helping companies maximize their online sales across B2C and B2B channels. In order to aggressively capitalize on the opportunities we see in the market, we are making further investments in sales, marketing and infrastructure resources beginning in early 2016 to support our growth in the second half of 2016 and going forward. We will also continue to pursue strategic acquisitions to enhance our agency and technology services footprint in Western Europe. We believe the execution of these initiatives will further strengthen our leadership position in the global eCommerce marketplace."
Fourth Quarter 2015 Financial Results Total revenues in the fourth quarter of 2015 increased 14% to $90.1 million compared to $78.7 million in the same period of 2014. Service fee revenue in the fourth quarter increased 27% to $60.9 million compared to $48.0 million last year. Product revenue was $13.9 million compared to $18.1 million in the same period of 2014 due to ongoing restructuring activities by the company's last remaining client in this segment and their discontinuation of certain product lines.
Service fee equivalent revenue increased 26% to a fourth quarter record $61.6 million compared to $49.0 million in the year-ago quarter, driven by both new and expanded client relationships, as well as approximately $8 million of service fees generated by the company's CrossView and Moda acquisitions in 2015.
Service fee gross margin in the fourth quarter increased 340 basis points to 31.6% compared to 28.2% in the same period of 2014. The increase was due to a higher proportion of agency and technology services in the 2015 quarter, in part due to the benefit from the acquisitions of REV and LiveArea that occurred in September 2014, as well as the Moda and CrossView acquisitions completed in 2015.
Adjusted EBITDA increased 9% to a fourth quarter record $7.5 million compared to $6.8 million in the same period of 2014. As a percentage of service fee equivalent revenue, adjusted EBITDA was 12.1% compared to 13.9% in the year-ago quarter.
Net loss in the fourth quarter was $0.6 million or $(0.03) per diluted share, compared to net income of $2.1 million or $0.12 per diluted share in the same period of 2014. Net loss in the fourth quarter of 2015 included $1.2 million in amortization of acquisition-related intangible assets, $1.2 million in stock-based compensation expense, and $1.3 million in acquisition-related, restructuring and other costs. This compares to $0.1 million in amortization of acquisition-related intangible assets, $0.6 million in stock-based compensation expense and $1.1 million in acquisition-related, restructuring and other costs in the same period of 2014.
Non-GAAP net income (a non-GAAP measure defined below) in the fourth quarter of 2015 was $3.1 million or $0.16 per diluted share, compared to $3.9 million or $0.21 per diluted share in the fourth quarter of 2014.
At December 31, 2015, cash and cash equivalents was $21.8 million compared to $18.1 million at December 31, 2014. Total debt was $35.4 million compared to $10.9 million at December 31, 2014, with the increase primarily due to funding of the CrossView acquisition.
Full Year 2015 Financial Results Total revenues in 2015 increased 17% to $288.3 million compared to $247.0 million in 2014. Service fee revenue in 2015 increased 36% to a record $182.2 million compared to $134.4 million last year, while product revenue was $58.7 million compared to $75.3 million in the prior year. Service fee equivalent revenue increased 34% to a record $185.3 million compared to $138.7 million in 2014.
Service fee gross margin in 2015 increased 280 basis points to 32.2% compared to 29.4% last year.
Adjusted EBITDA increased 52% to a record $20.7 million in 2015 compared to $13.7 million in 2014.
Net loss in 2015 was $7.9 million or $(0.45) per diluted share, compared to net loss of $4.6 million or $(0.28) per diluted share in 2014. Net loss in 2015 included $2.8 million in amortization of acquisition-related intangibles, $4.6 million in stock-based compensation expense, and $5.8 million in acquisition-related, restructuring and other costs. This compares to $0.1 million in amortization of acquisition-related intangibles, $3.1 million in stock-based compensation expense and $2.8 million in acquisition-related, restructuring and other costs in 2014.
Non-GAAP net income in 2015 increased 301% to a record $5.4 million or $0.29 per diluted share, compared to non-GAAP net income of $1.4 million or $0.08 per diluted share in 2014.
2016 Outlook PFSweb currently expects continued strong growth in service fee equivalent revenue and adjusted EBITDA as the company realizes a full year of benefit from its recent acquisitions, as well as incremental revenue from new and expanded client relationships. At this time, the company is reiterating its target for 2016 service fee equivalent revenue to range between $220 million and $230 million, reflecting growth of 19% to 24% from 2015. The company is also reiterating its target for adjusted EBITDA to range between $23 million to $25 million, up 11% to 21% from 2015. This adjusted EBITDA target includes the expected impact of incremental sales and marketing expenditures as well as other infrastructure expenditures to support the company's targeted future growth.
Conference Call PFSweb will conduct a conference call today at 5:00 p.m. Eastern time to discuss its results for the fourth quarter and full year ended December 31, 2015.
CEO Michael Willoughby and CFO Tom Madden will host the conference call, followed by a question and answer period.
Date: Monday, March 14, 2016 Time: 5:00 p.m. Eastern Time (4:00 p.m. Central time) Toll-free dial-in number: 1-888-523-1228 International dial-in number: 1-719-785-1765 Conference ID: 8183564
Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Liolios at 1-949-574-3860.
The conference call will be broadcast live and available for replay at http://public.viavid.com/index.php?id=118606 and via the investor relations section of the company's website at www.pfsweb.com.
A replay of the conference call will be available after 8:00 p.m. Eastern Time on the same day through March 28, 2016.
Toll-free replay number: 1-877-870-5176 International replay number: 1-858-384-5517 Replay ID: 8183564
About PFSweb, Inc. PFSweb (NASDAQ: PFSW) is a global commerce service provider of solutions including digital strategy consulting, digital agency and marketing services, technology development services, business process outsourcing services, and a complete omni-channel technology ecosystem. The company provides these solutions and services to major brand names and other companies seeking to optimize every customer experience and enhance their traditional and online business channels. PFSweb supports organizations across various industries, including Procter & Gamble, L'Oreal, LEGO, Columbia Sportswear, ASICS, Roots Canada Ltd., PANDORA, Diageo, BCBGMAXAZRIA, ROKA Sports, T.J. Maxx, the United States Mint, and many more. PFSweb is headquartered in Allen, TX with additional locations in Tennessee, Mississippi, Minnesota, Washington, New York, Ohio, North Carolina, Canada, Belgium, London, Munich, and India. For more information, please visit www.pfsweb.com or download the free PFSweb IR App on your iPhone, iPad, or Android device.
Non-GAAP Financial Measures This news release may contain certain non-GAAP measures, including non-GAAP net income (loss), earnings before interest, income taxes, depreciation and amortization (EBITDA), Adjusted EBITDA and service fee equivalent revenue.
Non-GAAP net income (loss) represents net income (loss) calculated in accordance with U.S. GAAP as adjusted for the impact of non-cash stock-based compensation expense, acquisition related, restructuring and other costs and the amortization of acquisition-related intangible assets.
EBITDA represents earnings (or losses) before interest, income taxes, depreciation, and amortization. Adjusted EBITDA further eliminates the effect of stock-based compensation, acquisition related, restructuring and other costs and amortization of acquisition-related intangible assets.
Service fee equivalent revenue represents service fee revenue plus the gross profit earned on product revenue.
Non-GAAP net income (loss), EBITDA, Adjusted EBITDA and service fee equivalent revenue are used by management, analysts, investors and other interested parties in evaluating our operating performance compared to that of other companies in our industry. The calculation of non-GAAP net income (loss) eliminates the effect of stock-based compensation, acquisition related, restructuring and other costs and amortization of acquisition-related intangible assets and EBITDA and adjusted EBITDA further eliminate the effect of financing, income taxes and the accounting effects of capital spending, which items may vary from different companies for reasons unrelated to overall operating performance. Service fee equivalent revenue allows client contracts with similar operational support models but different financial models to be combined as if all contracts were being operated on a service fee revenue basis.
PFSweb believes these non-GAAP measures provide useful information to both management and investors by focusing on certain operational metrics and excluding certain expenses in order to present its core operating performance and results. These measures should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for, or superior to, GAAP results. The non-GAAP measures included in this press release have been reconciled to the GAAP results in the attached tables.
Forward-Looking Statements The matters discussed herein consist of forward-looking information under the Private Securities Litigation Reform Act of 1995 and is subject to and involves risks and uncertainties, which could cause actual results to differ materially from the forward-looking information. PFSweb's Annual Report on Form 10-K for the year ended December 31, 2014 identifies certain factors that could cause actual results to differ materially from those projected in any forward looking statements made and investors are advised to review the Annual Report of the Company and the Risk Factors described therein. PFSweb undertakes no obligation to update publicly any forward-looking statement for any reason, even if new information becomes available or other events occur in the future. There may be additional risks that we do not currently view as material or that are not presently known.
PFSweb, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets (A)
(In Thousands, Except Share Data)
December December
31, 31,
2015 2014
----------- -----------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 21,781 $ 18,128
Restricted cash 275 521
Accounts receivable, net of allowance for
doubtful accounts of $600 and $447 at December
31, 2015 and December 31, 2014, respectively 70,700 59,126
Inventories, net of reserves of $739 and $768 at
December 31, 2015 and December 31, 2014,
respectively 9,262 10,534
Other receivables 8,704 5,638
Prepaid expenses and other current assets 5,662 7,103
----------- -----------
Total current assets 116,384 101,050
PROPERTY AND EQUIPMENT, net 24,093 26,604
INTANGIBLE ASSETS, net 8,810 2,170
GOODWILL 39,829 8,366
OTHER ASSETS 2,174 2,556
----------- -----------
Total assets 191,290 140,746
=========== ===========
LIABILITIES AND SHAREHOLDERS EQUITY
CURRENT LIABILITIES:
Current portion of long-term debt and capital
lease obligations $ 3,153 $ 6,850
Trade accounts payable 51,170 38,842
Deferred revenue 7,390 9,098
Performance-based contingent payments 11,679 2,338
Accrued expenses 30,563 26,135
----------- -----------
Total current liabilities 103,955 83,263
LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS, less
current portion 32,238 4,062
DEFERRED REVENUE 4,499 5,355
DEFERRED RENT 4,362 4,870
OTHER LONG-TERM LIABILITIES 2,478 3,091
----------- -----------
Total liabilities 147,532 100,641
----------- -----------
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY:
Preferred stock, $1.00 par value; 1,000,000
shares authorized; none issued and outstanding - -
Common stock, $.001 par value; 35,000,000 shares
authorized; 18,136,218 and 17,047,093 shares
issued at December 31, 2015 and December 31,
2014, respectively; and 18,102,751 and
17,013,622 shares outstanding as of December
31, 2015 and December 31, 2014, respectively 18 17
Additional paid-in capital 141,948 129,457
Accumulated deficit (97,787) (89,926)
Accumulated other comprehensive income (296) 682
Treasury stock at cost, 33,467 shares (125) (125)
----------- -----------
Total shareholders' equity 43,758 40,105
----------- -----------
Total liabilities and shareholders' equity $ 191,290 $ 140,746
=========== ===========
PFSweb, Inc. and Subsidiaries
Unaudited Condensed Consolidated Statements of Operations (A)
(In Thousands, Except Per Share Data)
Three Months Ended Years Ended
December 31, December 31,
-------------------- --------------------
2015 2014 2015 2014
--------- --------- --------- ---------
REVENUES:
Product revenue, net $ 13,928 $ 18,102 $ 58,659 $ 75,284
Service fee revenue 60,865 47,992 182,175 134,385
Pass-thru revenue 15,271 12,587 47,435 37,379
--------- --------- --------- ---------
Total revenues 90,064 78,681 288,269 247,048
--------- --------- --------- ---------
COSTS OF REVENUES:
Cost of product revenue 13,215 17,067 55,587 71,019
Cost of service fee revenue 41,633 34,471 123,574 94,858
Cost of pass-thru revenue 15,271 12,587 47,435 37,379
--------- --------- --------- ---------
Total costs of revenues 70,119 64,125 226,596 203,256
--------- --------- --------- ---------
Gross profit 19,945 14,556 61,673 43,792
SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES 19,212 12,387 66,280 47,658
--------- --------- --------- ---------
Income (loss) from
operations 733 2,169 (4,607) (3,866)
INTEREST EXPENSE, NET 509 323 1,757 813
--------- --------- --------- ---------
Income (loss) before income
taxes 224 1,846 (6,364) (4,679)
INCOME TAX PROVISION (BENEFIT) 822 (258) 1,497 (53)
--------- --------- --------- ---------
NET INCOME (LOSS) $ (598) $ 2,104 $ (7,861) $ (4,626)
========= ========= ========= =========
NON-GAAP NET INCOME $ 3,132 $ 3,883 $ 5,435 $ 1,355
========= ========= ========= =========
NET INCOME (LOSS) PER SHARE:
Basic $ (0.03) $ 0.12 $ (0.45) $ (0.28)
========= ========= ========= =========
Diluted $ (0.03) $ 0.12 $ (0.45) $ (0.28)
========= ========= ========= =========
WEIGHTED AVERAGE NUMBER OF
SHARES OUTSTANDING:
Basic 18,080 16,905 17,608 16,737
========= ========= ========= =========
Diluted 18,080 18,258 17,608 16,737
========= ========= ========= =========
EBITDA $ 4,918 $ 5,195 $ 10,224 $ 7,809
========= ========= ========= =========
ADJUSTED EBITDA $ 7,453 $ 6,835 $ 20,692 $ 13,651
========= ========= ========= =========
(A) The financial data above should be read in conjunction with the
audited consolidated financial statements of PFSweb, Inc., included
in its Form 10-K for the year ended December 31, 2014.
PFSweb, Inc. and Subsidiaries
Reconciliation of Certain Non-GAAP Items to GAAP
(In Thousands, Except Per Share Data)
Three Months Ended Years Ended
December 31, December 31,
-------------------- --------------------
2015 2014 2015 2014
--------- --------- --------- ---------
NET INCOME (LOSS) $ (598) $ 2,104 $ (7,861) $ (4,626)
Income tax expense (benefit) 822 (258) 1,497 (53)
Interest expense, net 509 323 1,757 813
Depreciation and
amortization 4,185 3,026 14,831 11,675
--------- --------- --------- ---------
EBITDA $ 4,918 $ 5,195 $ 10,224 $ 7,809
Stock-based compensation 1,191 550 4,637 3,059
Acquisition related,
restructuring and other
costs 1,344 1,090 5,831 2,783
--------- --------- --------- ---------
ADJUSTED EBITDA $ 7,453 $ 6,835 $ 20,692 $ 13,651
========= ========= ========= =========
Three Months Ended Years Ended
December 31, December 31,
-------------------- --------------------
2015 2014 2015 2014
--------- --------- --------- ---------
NET INCOME (LOSS) $ (598) $ 2,104 $ (7,861) $ (4,626)
Stock-based compensation 1,191 550 4,637 3,059
Amortization of acquisition-
related intangible assets 1,195 139 2,828 139
Acquisition related,
restructuring and other
costs 1,344 1,090 5,831 2,783
--------- --------- --------- ---------
NON-GAAP NET INCOME $ 3,132 $ 3,883 $ 5,435 $ 1,355
========= ========= ========= =========
NET INCOME (LOSS) PER SHARE:
Basic $ (0.03) $ 0.12 $ (0.45) $ (0.28)
========= ========= ========= =========
Diluted $ (0.03) $ 0.12 $ (0.45) $ (0.28)
========= ========= ========= =========
NON-GAAP NET INCOME PER SHARE:
Basic $ 0.17 $ 0.23 $ 0.31 $ 0.08
========= ========= ========= =========
Diluted $ 0.16 $ 0.21 $ 0.29 $ 0.08
========= ========= ========= =========
Three Months Ended Years Ended
December 31, December 31,
-------------------- --------------------
2015 2014 2015 2014
--------- --------- --------- ---------
TOTAL REVENUES $ 90,064 $ 78,681 $ 288,269 $ 247,048
Pass-thru revenue (15,271) (12,587) (47,435) (37,379)
Cost of product revenue (13,215) (17,067) (55,587) (71,019)
--------- --------- --------- ---------
SERVICE FEE EQUIVALENT REVENUE $ 61,578 $ 49,027 $ 185,247 $ 138,650
========= ========= ========= =========
PFSweb, Inc. and Subsidiaries
Unaudited Consolidating Statements of Operations
For the Three Months Ended December 31, 2015
(In Thousands)
Business
& Retail
PFSweb Connect Eliminations Consolidated
--------- --------- ------------ ------------
REVENUES:
Product revenue, net $ - $ 13,928 $ - $ 13,928
Service fee revenue 54,771 6,094 - 60,865
Service fee revenue -
affiliate 5,422 250 (5,672) -
Pass-thru revenue 15,271 - - 15,271
--------- --------- ------------ ------------
Total revenues 75,464 20,272 (5,672) 90,064
--------- --------- ------------ ------------
COSTS OF REVENUES:
Cost of product revenue - 13,256 - 13,256
Cost of service fee
revenue 41,345 5,736 (5,489) 41,592
Cost of pass-thru revenue 15,271 - - 15,271
--------- --------- ------------ ------------
Total costs of
revenues 56,616 18,992 (5,489) 70,119
--------- --------- ------------ ------------
Gross profit 18,848 1,280 (183) 19,945
SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES 18,899 496 (183) 19,212
--------- --------- ------------ ------------
Income (loss) from
operations (51) 784 - 733
INTEREST EXPENSE, NET 414 95 - 509
--------- --------- ------------ ------------
Income (loss) before
income taxes (465) 689 - 224
INCOME TAX PROVISION 592 230 - 822
--------- --------- ------------ ------------
NET INCOME (LOSS) $ (1,057) $ 459 $ - $ (598)
========= ========= ============ ============
NON-GAAP NET INCOME $ 2,673 $ 459 $ - $ 3,132
========= ========= ============ ============
EBITDA $ 4,124 $ 794 $ - $ 4,918
========= ========= ============ ============
ADJUSTED EBITDA $ 6,659 $ 794 $ - $ 7,453
========= ========= ============ ============
A reconciliation of NET INCOME (LOSS) to EBITDA and ADJUSTED EBITDA
follows:
NET INCOME (LOSS) $ (1,057) $ 459 $ - (598)
Income tax expense 592 230 - 822
Interest expense, net 414 95 - 509
Amortization of
acquisition-related
intangible assets 1,195 - - 1,195
Depreciation and
amortization 2,980 10 - 2,990
--------- --------- ------------ ------------
EBITDA $ 4,124 $ 794 $ - $ 4,918
Stock-based compensation 1,191 - - 1,191
Acquisition related,
restructuring and other
costs 1,344 - - 1,344
--------- --------- ------------ ------------
ADJUSTED EBITDA $ 6,659 $ 794 $ - $ 7,453
========= ========= ============ ============
A reconciliation of NET INCOME (LOSS) to NON-GAAP NET INCOME follows:
NET INCOME (LOSS) $ (1,057) $ 459 $ - $ (598)
Stock-based compensation 1,191 - - 1,191
Amortization of
acquisition-related
intangible assets 1,195 - - 1,195
Acquisition related,
restructuring and other
costs 1,344 - - 1,344
--------- --------- ------------ ------------
NON-GAAP NET INCOME $ 2,673 $ 459 $ - $ 3,132
========= ========= ============ ============
Note: Business and Retail Connect includes our Supplies Distributors and
PFSweb Retail Connect operations, which operate similar financial models
on behalf of our client relationships.
PFSweb, Inc. and Subsidiaries
Unaudited Consolidating Statements of Operations
For the Three Months Ended December 31, 2014
(In Thousands)
Business &
Retail
PFSweb Connect Eliminations Consolidated
---------- ---------- ------------ ------------
REVENUES:
Product revenue, net $ - $ 18,102 $ - $ 18,102
Service fee revenue 42,634 5,358 - 47,992
Service fee revenue -
affiliate 4,642 292 (4,934) -
Pass-thru revenue 12,587 - - 12,587
---------- ---------- ------------ ------------
Total revenues 59,863 23,752 (4,934) 78,681
---------- ---------- ------------ ------------
COSTS OF REVENUES:
Cost of product revenue - 17,067 - 17,067
Cost of service fee
revenue 33,855 5,328 (4,712) 34,471
Cost of pass-thru
revenue 12,587 - - 12,587
---------- ---------- ------------ ------------
Total costs of
revenues 46,442 22,395 (4,712) 64,125
---------- ---------- ------------ ------------
Gross profit 13,421 1,357 (222) 14,556
SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES 12,025 584 (222) 12,387
---------- ---------- ------------ ------------
Income from
operations 1,396 773 - 2,169
INTEREST EXPENSE, NET 196 127 - 323
---------- ---------- ------------ ------------
Income before income
taxes 1,200 646 - 1,846
INCOME TAX PROVISION
(BENEFIT) (497) 239 - (258)
---------- ---------- ------------ ------------
NET INCOME $ 1,697 $ 407 $ - $ 2,104
========== ========== ============ ============
NON-GAAP NET INCOME $ 3,476 $ 407 $ - $ 3,883
========== ========== ============ ============
EBITDA $ 4,409 $ 786 $ - $ 5,195
========== ========== ============ ============
ADJUSTED EBITDA $ 6,049 $ 786 $ - $ 6,835
========== ========== ============ ============
A reconciliation of NET INCOME to EBITDA and ADJUSTED EBITDA follows:
NET INCOME $ 1,697 $ 407 $ - 2,104
Income tax expense
(benefit) (497) 239 - (258)
Interest expense, net 196 127 - 323
Amortization of
acquisition-related
intangible assets 139 - - 139
Depreciation and
amortization 2,874 13 - 2,887
---------- ---------- ------------ ------------
EBITDA $ 4,409 $ 786 $ - $ 5,195
Stock-based
compensation 550 - - 550
Acquisition related,
restructuring and
other costs 1,090 - - 1,090
---------- ---------- ------------ ------------
ADJUSTED EBITDA $ 6,049 $ 786 $ - $ 6,835
========== ========== ============ ============
A reconciliation of NET INCOME to NON-GAAP NET INCOME follows:
NET INCOME $ 1,697 $ 407 $ - $ 2,104
Stock-based
compensation 550 - - 550
Amortization of
acquisition-related
intangible assets 139 - - 139
Acquisition related,
restructuring and
other costs 1,090 - - 1,090
---------- ---------- ------------ ------------
NON-GAAP NET INCOME $ 3,476 $ 407 $ - $ 3,883
========== ========== ============ ============
Note: Business and Retail Connect includes our Supplies Distributors and
PFSweb Retail Connect operations, which operate similar financial models
on behalf of our client relationships.
PFSweb, Inc. and Subsidiaries
Unaudited Consolidating Statements of Operations
For the Year Ended December 31, 2015
(In Thousands)
Business &
Retail
PFSweb Connect Eliminations Consolidated
---------- ---------- ------------ ------------
REVENUES:
Product revenue, net $ - $ 58,659 $ - $ 58,659
Service fee revenue 165,510 16,665 - 182,175
Service fee revenue -
affiliate 15,559 818 (16,377) -
Pass-thru revenue 47,435 - - 47,435
---------- ---------- ------------ ------------
Total revenues 228,504 76,142 (16,377) 288,269
---------- ---------- ------------ ------------
COSTS OF REVENUES:
Cost of product revenue - 55,587 - 55,587
Cost of service fee
revenue 122,981 16,193 (15,600) 123,574
Cost of pass-thru
revenue 47,435 - - 47,435
---------- ---------- ------------ ------------
Total costs of
revenues 170,416 71,780 (15,600) 226,596
---------- ---------- ------------ ------------
Gross profit 58,088 4,362 (777) 61,673
SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES 64,427 2,630 (777) 66,280
---------- ---------- ------------ ------------
Income (loss) from
operations (6,339) 1,732 - (4,607)
INTEREST EXPENSE, NET 1,326 431 - 1,757
---------- ---------- ------------ ------------
Income (loss) before
income taxes (7,665) 1,301 - (6,364)
INCOME TAX PROVISION 954 543 - 1,497
---------- ---------- ------------ ------------
NET INCOME (LOSS) $ (8,619) $ 758 $ - $ (7,861)
========== ========== ============ ============
NON-GAAP NET INCOME $ 4,357 $ 1,078 $ - $ 5,435
========== ========== ============ ============
EBITDA $ 8,424 $ 1,800 $ - $ 10,224
========== ========== ============ ============
ADJUSTED EBITDA $ 18,572 $ 2,120 $ - $ 20,692
========== ========== ============ ============
A reconciliation of NET INCOME (LOSS) to EBITDA and ADJUSTED EBITDA
follows:
NET INCOME (LOSS) $ (8,619) $ 758 $ - (7,861)
Income tax expense
(benefit) 954 543 - 1,497
Interest expense
(income), net 1,326 431 - 1,757
Amortization of
acquisition-related
intangible assets 2,828 - - 2,828
Depreciation and
amortization 11,935 68 - 12,003
---------- ---------- ------------ ------------
EBITDA $ 8,424 $ 1,800 $ - $ 10,224
Stock-based
compensation 4,637 - - 4,637
Acquisition related,
restructuring and
other costs 5,511 320 - 5,831
---------- ---------- ------------ ------------
ADJUSTED EBITDA $ 18,572 $ 2,120 $ - $ 20,692
========== ========== ============ ============
A reconciliation of NET INCOME (LOSS) to NON-GAAP NET INCOME follows:
NET INCOME (LOSS) $ (8,619) $ 758 $ - $ (7,861)
Stock-based
compensation 4,637 - - 4,637
Amortization of
acquisition-related
intangible assets 2,828 - - 2,828
Acquisition related,
restructuring and
other costs 5,511 320 - 5,831
---------- ---------- ------------ ------------
NON-GAAP NET INCOME $ 4,357 $ 1,078 $ - $ 5,435
========== ========== ============ ============
Note: Business and Retail Connect includes our Supplies Distributors and
PFSweb Retail Connect operations, which operate similar financial models
on behalf of our client relationships.
PFSweb, Inc. and Subsidiaries
Unaudited Consolidating Statements of Operations
For the Year Ended December 31, 2014
(In Thousands)
Business &
Retail
PFSweb Connect Eliminations Consolidated
---------- ---------- ------------ ------------
REVENUES:
Product revenue, net $ - $ 75,284 $ - $ 75,284
Service fee revenue 119,573 14,812 - 134,385
Service fee revenue -
affiliate 14,556 1,138 (15,694) -
Pass-thru revenue 37,379 - - 37,379
---------- ---------- ------------ ------------
Total revenues 171,508 91,234 (15,694) 247,048
---------- ---------- ------------ ------------
COSTS OF REVENUES:
Cost of product revenue - 71,019 - 71,019
Cost of service fee
revenue 94,301 15,182 (14,625) 94,858
Cost of pass-thru
revenue 37,379 - - 37,379
---------- ---------- ------------ ------------
Total costs of
revenues 131,680 86,201 (14,625) 203,256
---------- ---------- ------------ ------------
Gross profit 39,828 5,033 (1,069) 43,792
SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES 45,779 2,948 (1,069) 47,658
---------- ---------- ------------ ------------
Income (loss) from
operations (5,951) 2,085 - (3,866)
INTEREST EXPENSE
(INCOME), NET 264 549 - 813
---------- ---------- ------------ ------------
Income (loss) before
income taxes (6,215) 1,536 - (4,679)
INCOME TAX PROVISION
(BENEFIT) (625) 572 - (53)
---------- ---------- ------------ ------------
NET INCOME (LOSS) $ (5,590) $ 964 $ - $ (4,626)
========== ========== ============ ============
NON-GAAP NET INCOME $ 391 $ 964 $ - $ 1,355
========== ========== ============ ============
EBITDA $ 5,669 $ 2,140 $ - $ 7,809
========== ========== ============ ============
ADJUSTED EBITDA $ 11,511 $ 2,140 $ - $ 13,651
========== ========== ============ ============
A reconciliation of NET INCOME (LOSS) to EBITDA and ADJUSTED EBITDA
follows:
NET INCOME (LOSS) $ (5,590) $ 964 $ - (4,626)
Income tax expense
(benefit) (625) 572 - (53)
Interest expense
(income), net 264 549 - 813
Amortization of
acquisition-related
intangible assets 139 - - 139
Depreciation and
amortization 11,481 55 - 11,536
---------- ---------- ------------ ------------
EBITDA $ 5,669 $ 2,140 $ - $ 7,809
Stock-based
compensation 3,059 - - 3,059
Acquisition related,
restructuring and
other costs 2,783 - - 2,783
---------- ---------- ------------ ------------
ADJUSTED EBITDA $ 11,511 $ 2,140 $ - $ 13,651
========== ========== ============ ============
A reconciliation of NET INCOME (LOSS) to NON-GAAP NET INCOME (LOSS)
follows:
NET INCOME (LOSS) $ (5,590) $ 964 $ - $ (4,626)
Stock-based
compensation 3,059 - - 3,059
Amortization of
acquisition-related
intangible assets 139 - - 139
Acquisition related,
restructuring and
other costs 2,783 - - 2,783
---------- ---------- ------------ ------------
NON-GAAP NET INCOME $ 391 $ 964 $ - $ 1,355
========== ========== ============ ============
Note: Business and Retail Connect includes our Supplies Distributors and
PFSweb Retail Connect operations, which operate similar financial models
on behalf of our client relationships.
PFSweb, Inc. and Subsidiaries
Unaudited Condensed Consolidating Balance Sheets
as of December 31, 2015
(In Thousands)
Business &
Retail
PFSweb Connect Eliminations Consolidated
---------- ---------- ------------ ------------
ASSETS
CURRENT ASSETS:
Cash and cash
equivalents $ 7,962 $ 13,819 $ - $ 21,781
Restricted cash 51 224 - 275
Accounts receivable,
net 51,231 20,348 (879) 70,700
Inventories, net - 9,262 - 9,262
Other receivables 2,621 6,083 - 8,704
Prepaid expenses and
other current assets 4,744 918 - 5,662
---------- ---------- ------------ ------------
Total current assets 66,609 50,654 (879) 116,384
PROPERTY AND EQUIPMENT,
net 24,065 28 - 24,093
RECEIVABLE/INVESTMENT IN
AFFILIATES 9,577 - (9,577) -
INTANGIBLE ASSETS, net 8,810 - - 8,810
GOODWILL 39,829 - - 39,829
OTHER ASSETS 2,174 - - 2,174
---------- ---------- ------------ ------------
Total assets 151,064 50,682 (10,456) 191,290
========== ========== ============ ============
LIABILITIES AND
SHAREHOLDERS EQUITY
CURRENT LIABILITIES:
Current portion of
long-term debt and
capital lease
obligations $ 3,153 $ - $ - $ 3,153
Trade accounts payable 15,329 36,710 (869) 51,170
Deferred revenue 7,390 - - 7,390
Performance-based
contingent payments 11,679 - - 11,679
Accrued expenses 26,015 4,558 (10) 30,563
---------- ---------- ------------ ------------
Total current
liabilities 63,566 41,268 (879) 103,955
LONG-TERM DEBT AND
CAPITAL LEASE
OBLIGATIONS, less
current portion 32,238 - - 32,238
PAYABLE TO AFFILIATES - 22,056 (22,056) -
DEFERRED REVENUE 4,499 - - 4,499
DEFERRED RENT 4,362 - - 4,362
OTHER LONG-TERM
LIABILITIES 2,478 - - 2,478
---------- ---------- ------------ ------------
Total liabilities 107,143 63,324 (22,935) 147,532
---------- ---------- ------------ ------------
COMMITMENTS AND
CONTINGENCIES
SHAREHOLDERS' EQUITY:
Common stock 18 19 (19) 18
Capital contributions - 1,000 (1,000) -
Additional paid-in
capital 141,948 28,060 (28,060) 141,948
Retained earnings
(accumulated deficit) (97,616) (42,827) 42,656 (97,787)
Accumulated other
comprehensive income (304) 1,106 (1,098) (296)
Treasury stock (125) - - (125)
---------- ---------- ------------ ------------
Total shareholders'
equity 43,921 (12,642) 12,479 43,758
---------- ---------- ------------ ------------
Total liabilities
and shareholders'
equity $ 151,064 $ 50,682 $ (10,456) $ 191,290
========== ========== ============ ============
(A) The financial data above should be read in conjunction with the audited
consolidated financial statements of PFSweb, Inc., included in its Form
10-K for the year ended December 31, 2014.
PFSweb, Inc. and Subsidiaries
Unaudited Condensed Consolidating Balance Sheets
as of December 31, 2014
(In Thousands)
Business &
Retail
PFSweb Connect Eliminations Consolidated
---------- ---------- ------------ ------------
ASSETS
CURRENT ASSETS:
Cash and cash
equivalents $ 6,671 $ 11,457 $ - $ 18,128
Restricted cash - 521 - 521
Accounts receivable,
net 42,081 18,415 (1,370) 59,126
Inventories, net - 10,534 - 10,534
Other receivables - 5,638 - 5,638
Prepaid expenses and
other current assets 6,141 962 - 7,103
---------- ---------- ------------ ------------
Total current assets 54,893 47,527 (1,370) 101,050
PROPERTY AND EQUIPMENT,
net 26,478 126 - 26,604
RECEIVABLE/INVESTMENT IN
AFFILIATES 9,938 - (9,938) -
INTANGIBLE ASSETS, net 2,170 - - 2,170
GOODWILL 8,366 - - 8,366
OTHER ASSETS 2,527 29 - 2,556
---------- ---------- ------------ ------------
Total assets 104,372 47,682 (11,308) 140,746
========== ========== ============ ============
LIABILITIES AND
SHAREHOLDERS EQUITY
CURRENT LIABILITIES:
Current portion of
long-term debt and
capital lease
obligations $ 3,583 $ 3,267 $ - $ 6,850
Trade accounts payable 13,001 27,211 (1,370) 38,842
Deferred revenue 9,098 - - 9,098
Performance-based
contingent payments 2,338 - - 2,338
Accrued expenses 19,000 7,135 - 26,135
---------- ---------- ------------ ------------
Total current
liabilities 47,020 37,613 (1,370) 83,263
LONG-TERM DEBT AND
CAPITAL LEASE
OBLIGATIONS, less
current portion 4,062 - - 4,062
PAYABLE TO AFFILIATES - 22,045 (22,045) -
DEFERRED REVENUE 5,355 - - 5,355
DEFERRED RENT 4,870 - - 4,870
OTHER LONG-TERM
LIABILITIES 3,091 - - 3,091
---------- ---------- ------------ ------------
Total liabilities 64,398 59,658 (23,415) 100,641
---------- ---------- ------------ ------------
COMMITMENTS AND
CONTINGENCIES
SHAREHOLDERS' EQUITY:
Common stock 17 19 (19) 17
Capital contributions - 1,000 (1,000) -
Additional paid-in
capital 129,457 28,060 (28,060) 129,457
Retained earnings
(accumulated deficit) (90,061) (42,711) 42,846 (89,926)
Accumulated other
comprehensive income 686 1,656 (1,660) 682
Treasury stock (125) - - (125)
---------- ---------- ------------ ------------
Total shareholders'
equity 39,974 (11,976) 12,107 40,105
---------- ---------- ------------ ------------
Total liabilities
and shareholders'
equity $ 104,372 $ 47,682 $ (11,308) $ 140,746
========== ========== ============ ============
(A) The financial data above should be read in conjunction with the audited
consolidated financial statements of PFSweb, Inc., included in its Form
10-K for the year ended December 31, 2014.
Company Contact: Michael C. Willoughby Chief Executive Officer or Thomas J. Madden Chief Financial Officer Tel 972-881-2900 Investor Relations: Liolios Scott Liolios or Sean Mansouri Tel 949-574-3860 Email Contact
Source: PFSweb, Inc.
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