PFSweb Reports 23% Service Fee Revenue Growth in Third Quarter of 2012 Compared to Prior Year
Mark Layton, Chairman and Chief Executive Officer of PFSweb, stated, “Fueled by new clients as well as increases in certain existing client activity, our Service Fee Equivalent Revenue increased 18% to $30.2 million, as compared to the third quarter of 2011. This growth, coupled with an ongoing focus on operating costs and efficiencies, resulted in an improved Adjusted EBITDA for the third quarter of 2012 to $2.8 million, a 300% increase over the same period last year. With these improved third quarter results and our current expectations of client volumes during this upcoming holiday season, we continue to target an annual increase in our Service Fee Equivalent Revenue for 2012 of 20%, and we are increasing our Adjusted EBITDA target to a range of $10 million to $12 million for the year.”
“This past quarter we finalized two new client programs, bringing our new client program count for 2012 to 10. In addition, we continue to have a robust new business pipeline with more than $50 million in average annual contract value based on client projections. To support new clients and our existing clients’ activity anticipated for this upcoming holiday season, we continue to make investments to bolster our overall capacity and reliability across all phases of our business. These enhancements are designed to provide our clients’ customers the outstanding shopping experience they desire,” added Mr. Layton.
“We are continuing to develop new solutions to position PFSweb as a leader in the eCommerce and omni-channel evolution through PFSweb’s Infinite Commerce Initiative. Our goal is to act as the global facilitator for all types of commerce for our clients across all channels and customer touch points. At this stage, we are extending our order management and eCommerce technology platforms to include cross-channel capabilities that fully integrate brick-and-mortar stores, client and third-party fulfillment facilities. We are also working on new mobile commerce capabilities, in-store customer support, kiosks and ‘clienteling’ apps,” continued Mr. Layton.
Summary of consolidated results for the third quarter ended September 30, 2012:
- Service Fee revenue increased 23% to $28.3 million, compared to $22.9 million for the same period in 2011; Service Fee Equivalent Revenue (as defined) increased 18% to $30.2 million, compared to $25.6 million for the same period in 2011;
- Total revenue decreased 6% to $66.5 million, compared to $70.9 million for the third quarter of 2011;
- Adjusted EBITDA (as defined) increased 300% to $2.8 million, compared to $0.7 million for the same period in 2011;
- Net loss was $0.4 million, or $0.03 per basic and diluted share, compared to a net loss of $1.8 million, or $0.14 per basic and diluted share, for the third quarter of 2011;
- Non-GAAP net loss (as defined) was $62,000, or less than $0.01 per basic and diluted share, compared to a non-GAAP net loss of $1.5 million, or $0.12 per basic and diluted share, for the quarter ended September 30, 2011;
Summary of consolidated results for the nine months ended September 30, 2012:
- Service Fee revenue increased 35% to $85.0 million, compared with $62.8 million for the nine months ended September 30, 2011; Service Fee Equivalent Revenue (as defined) increased 28% to $92.0 million, compared to $71.6 million for the same period in 2011;
- Total revenue decreased 1% to $209.8 million compared to $211.3 million for the nine months ended September 30, 2011;
- Adjusted EBITDA (as defined) was $8.2 million compared to $2.2 million for the nine months ended September 30, 2011;
- Net loss was $2.2 million, or $0.17 per basic and diluted share, compared to a net loss of $5.3 million or $0.43 per basic and diluted share, for the nine months ended September 30, 2011. Net loss for the nine months ended September 30, 2012 included approximately $0.9 million of move related expenses, and $0.5 million of lease termination costs that were reflected in selling, general and administrative expenses. Net loss for the first nine months of 2011 included approximately $0.3 million of relocation related costs. Net loss for the first nine months of 2011 also included a $0.6 million net loss from discontinued operations related to eCOST.com;
- Non-GAAP net income was $0.2 million, or $0.01 per basic and diluted share, compared to a non-GAAP net loss of $3.7 million, or $0.30 per basic and diluted share, for the nine months ended September 30, 2011.
“I am very pleased with our performance in 2012 and believe we have made the appropriate investments to finish 2012 strong. The benefits of scale in our business are clearly reflected in the improved Adjusted EBITDA results we have produced this year. However, as previously discussed, we currently expect our Service Fee Equivalent Revenue and profitability to be negatively impacted in 2013 by the conclusion or anticipated reduction of operations of several client programs, projected declines in product revenue due to the impact of restructuring efforts by our largest client relationship in our Business and Retail Connect Segment, and further by the loss of certain scale and gross margin mix benefits we achieved during 2012. While we continue to win new client relationships and generate many new and exciting opportunities in our sales pipeline, based on the client information and timing estimates we currently have, we believe it is unlikely that projected new client revenue will offset the impact of these expected reductions in 2013. We remain optimistic about our growth potential as we look towards 2014 and beyond, but our current focus on large client programs can result in large fluctuations in client activity levels as existing clients choose to move operations in-house or to other solutions and as new clients implementations begin. We expect to provide 2013 projections in the first quarter of next year as we gather more information from all our clients on their projected volumes,” concluded Mr. Layton.
Conference Call Information
Management will host a conference call at 11:00 am Eastern Time (10:00 am Central Time) on Thursday, November 8, 2012, to discuss the latest corporate developments and results. To listen to the call, please dial (888) 562-3356 and enter the pin number 58992288 at least five minutes before the scheduled start time. Investors can also access the call in a “listen only” mode via the Internet at the Company’s website, www.pfsweb.com or www.kcsa.com. Please allow extra time prior to the call to visit the site and download any necessary audio software.
A digital replay of the conference call will be available through December 10, 2012 at (855) 859-2056, pin number 58992288. The replay also will be available at the Company’s website for a limited time.
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, income (loss) from discontinued operations, lease termination costs and certain move related expenses.
EBITDA represents earnings (or losses) before income (loss) from discontinued operations, interest, income taxes, depreciation, and amortization. Adjusted EBITDA further eliminates the effect of stock-based compensation, lease termination costs, certain relocation related costs and certain move related expenses.
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, income (loss) from discontinued operations, lease termination costs and certain move related expenses and EBITDA and Adjusted EBITDA further eliminate the effect of financing, income taxes, the accounting effects of capital spending and certain relocation related costs, 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 excluding certain expenses that may not be indicative of its core operating 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.
About PFSweb, Inc.
Iconic brands engage PFSweb to enable their eCommerce initiatives. PFSweb’s End2End eCommerce® solution includes interactive marketing services, robust eCommerce technology, global fulfillment and logistics, high-touch customer care, financial services, and order management. PFSweb’s eCommerce solutions provide international reach and expertise in both direct-to-consumer and business-to-business initiatives, supporting organizations across multiple industries including Procter & Gamble, L’Oreal, LEGO, Columbia Sportswear, Sorel, Carter’s, Lucky Brand Jeans, kate spade new york, Juicy Couture, AAFES, Riverbed, Ricoh, Hawker Beechcraft Corp, Roots Canada Ltd. and Xerox. PFSweb is headquartered in Allen, TX with additional locations in Tennessee, Mississippi, Canada, Belgium, and the Philippines.
To find out more about PFSweb, Inc. (NASDAQ: PFSW), visit the company’s website at http://www.PFSweb.com.
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, 2011 and Quarterly Report on Form 10-Q for the three and six months ended June 30, 2012 identify 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 and Quarterly Reports 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.
(Financial Tables Below)
|
PFSweb, Inc. and Subsidiaries |
||||||||||||||||
| Unaudited Condensed Consolidated Statements of Operations (A) | ||||||||||||||||
| (In Thousands, Except Per Share Data) | ||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||
| September 30, | September 30, | |||||||||||||||
| 2012 | 2011 | 2012 | 2011 | |||||||||||||
| REVENUES: | ||||||||||||||||
| Product revenue, net | $ | 27,619 | $ | 37,923 | $ | 91,901 | $ | 122,005 | ||||||||
| Service fee revenue | 28,260 | 22,949 | 85,022 | 62,819 | ||||||||||||
| Pass-thru revenue | 10,654 | 9,999 | 32,882 | 26,444 | ||||||||||||
|
Total revenues |
66,533 | 70,871 | 209,805 | 211,268 | ||||||||||||
| COSTS OF REVENUES: | ||||||||||||||||
| Cost of product revenue | 25,681 | 35,304 | 84,934 | 113,181 | ||||||||||||
| Cost of service fee revenue | 20,397 | 17,663 | 61,996 | 47,241 | ||||||||||||
| Cost of pass-thru revenue | 10,654 | 9,999 | 32,882 | 26,444 | ||||||||||||
|
Total costs of revenues |
56,732 | 62,966 | 179,812 | 186,866 | ||||||||||||
|
Gross profit |
9,801 | 7,905 | 29,993 | 24,402 | ||||||||||||
| SELLING, GENERAL AND ADMINISTRATIVE EXPENSES | 9,781 | 9,385 | 30,941 | 28,103 | ||||||||||||
| Income (loss) from operations | 20 | (1,480 | ) | (948 | ) | (3,701 | ) | |||||||||
| INTEREST EXPENSE, NET | 236 | 308 | 758 | 769 | ||||||||||||
| Income (loss) before income taxes | (216 | ) | (1,788 | ) | (1,706 | ) | (4,470 | ) | ||||||||
| INCOME TAX PROVISION | 154 | 57 | 457 | 287 | ||||||||||||
| INCOME (LOSS) FROM CONTINUING OPERATIONS | (370 | ) | (1,845 | ) | (2,163 | ) | (4,757 | ) | ||||||||
| INCOME (LOSS) FROM DISCONTINUED OPERATIONS, NET OF TAX | - | 20 | - | (569 | ) | |||||||||||
| NET INCOME (LOSS) | $ | (370 | ) | $ | (1,825 | ) | $ | (2,163 | ) | $ | (5,326 | ) | ||||
| NON-GAAP INCOME (LOSS) | $ | (62 | ) | $ | (1,499 | ) | $ | 167 | $ | (3,702 | ) | |||||
| NET INCOME (LOSS) PER SHARE: | ||||||||||||||||
| Basic | $ | (0.03 | ) | $ | (0.14 | ) | $ | (0.17 | ) | $ | (0.43 | ) | ||||
| Diluted | $ | (0.03 | ) | $ | (0.14 | ) | $ | (0.17 | ) | $ | (0.43 | ) | ||||
| WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING: | ||||||||||||||||
| Basic | 12,783 | 12,688 | 12,777 | 12,509 | ||||||||||||
| Diluted | 12,783 | 12,688 | 12,777 | 12,509 | ||||||||||||
| EBITDA | $ | 2,522 | $ | 57 | $ | 5,886 | $ | 874 | ||||||||
| ADJUSTED EBITDA | $ | 2,830 | $ | 707 | $ | 8,216 | $ | 2,233 | ||||||||
|
|
||||||||||||||||
(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, 2011.
|
PFSweb, Inc. and Subsidiaries |
|||||||||||||||||
| Reconciliation of certain Non-GAAP Items to GAAP | |||||||||||||||||
| (In Thousands, Except Per Share Data) | |||||||||||||||||
| Three Months Ended | Nine Months Ended | ||||||||||||||||
| September 30, | September 30, | ||||||||||||||||
| 2012 | 2011 | 2012 | 2011 | ||||||||||||||
| NET INCOME (LOSS) | $ | (370 | ) | $ | (1,825 | ) | $ | (2,163 | ) | $ | (5,326 | ) | |||||
| Loss (income) from discontinued operations, net of tax | - | (20 | ) | - | 569 | ||||||||||||
| Income tax expense | 154 | 57 | 457 | 287 | |||||||||||||
| Interest expense | 236 | 308 | 758 | 769 | |||||||||||||
| Depreciation and amortization | 2,502 | 1,537 | 6,834 | 4,575 | |||||||||||||
| EBITDA | $ | 2,522 | $ | 57 | $ | 5,886 | $ | 874 | |||||||||
| Stock-based compensation | 308 | 346 | 1,014 | 1,055 | |||||||||||||
| Lease terminations costs | - | - | 450 | - | |||||||||||||
| Relocation related costs | - | 304 | - | 304 | |||||||||||||
| Move related expenses | - | - | 866 | - | |||||||||||||
| ADJUSTED EBITDA | $ | 2,830 | $ | 707 | $ | 8,216 | $ | 2,233 | |||||||||
| Three Months Ended | Nine Months Ended | ||||||||||||||||
| September 30, | September 30, | ||||||||||||||||
| 2012 | 2011 | 2012 | 2011 | ||||||||||||||
| NET INCOME (LOSS) | $ | (370 | ) | $ | (1,825 | ) | $ | (2,163 | ) | $ | (5,326 | ) | |||||
| Loss (income) from discontinued operations, net of tax | - | (20 | ) | - | 569 | ||||||||||||
| Stock-based compensation | 308 | 346 | 1,014 | 1,055 | |||||||||||||
| Lease terminations costs | - | - | 450 | - | |||||||||||||
| Move related expenses | - | - | 866 | - | |||||||||||||
| NON-GAAP INCOME (LOSS) | $ | (62 | ) | $ | (1,499 | ) | $ | 167 | $ | (3,702 | ) | ||||||
| NET INCOME (LOSS) PER SHARE: | |||||||||||||||||
| Basic | $ | (0.03 | ) | $ | (0.14 | ) | $ | (0.17 | ) | $ | (0.43 | ) | |||||
| Diluted | $ | (0.03 | ) | $ | (0.14 | ) | $ | (0.17 | ) | $ | (0.43 | ) | |||||
| NON-GAAP INCOME (LOSS) Per Share: | |||||||||||||||||
| Basic | $ | (0.00 | ) | $ | (0.12 | ) | $ | 0.01 | $ | (0.30 | ) | ||||||
| Diluted | $ | (0.00 | ) | $ | (0.12 | ) | $ | 0.01 | $ | (0.30 | ) | ||||||
| Three Months Ended | Nine Months Ended | ||||||||||||||||
| September 30, | September 30, | ||||||||||||||||
| 2012 | 2011 | 2012 | 2011 | ||||||||||||||
| TOTAL REVENUES | $ | 66,533 | $ | 70,871 | $ | 209,805 | $ | 211,268 | |||||||||
| Pass-thru revenue | (10,654 | ) | (9,999 | ) | (32,882 | ) | (26,444 | ) | |||||||||
| Cost of product revenue | (25,681 | ) | (35,304 | ) | (84,934 | ) | (113,181 | ) | |||||||||
| SERVICE FEE EQUIVALENT REVENUE | $ | 30,198 | $ | 25,568 | $ | 91,989 | $ | 71,643 | |||||||||
| PFSweb, Inc. and Subsidiaries | ||||||||
| Unaudited Condensed Consolidated Balance Sheets | ||||||||
| (In Thousands, Except Share Data) | ||||||||
| September 30, | December 31, | |||||||
| 2012 | 2011 | |||||||
|
ASSETS |
||||||||
| CURRENT ASSETS: | ||||||||
| Cash and cash equivalents | $ | 17,793 | $ | 17,695 | ||||
| Restricted cash | 471 | 827 | ||||||
| Accounts receivable, net of allowance for doubtful accounts of $479 and | ||||||||
| $663 at September 30, 2012 and December 31, 2011, respectively | 38,057 | 52,679 | ||||||
| Inventories, net of reserves of $1,696 and $1,555 at September 30, 2012 and | ||||||||
| December 31, 2011, respectively | 25,453 | 30,487 | ||||||
| Other receivables | 7,340 | 11,915 | ||||||
| Prepaid expenses and other current assets | 4,663 | 4,697 | ||||||
| Total current assets | 93,777 | 118,300 | ||||||
| PROPERTY AND EQUIPMENT, net | 25,539 | 14,945 | ||||||
| OTHER ASSETS | 3,928 | 3,127 | ||||||
| Total assets | 123,244 | 136,372 | ||||||
|
LIABILITIES AND SHAREHOLDERS EQUITY |
||||||||
| CURRENT LIABILITIES: | ||||||||
| Current portion of long-term debt and capital lease obligations | $ | 19,073 | $ | 23,939 | ||||
| Trade accounts payable | 33,437 | 48,544 | ||||||
| Deferred revenue | 6,808 | 6,766 | ||||||
| Accrued expenses | 19,353 | 18,657 | ||||||
| Total current liabilities | 78,671 | 97,906 | ||||||
| LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS, less current portion | 5,771 | 3,583 | ||||||
| DEFERRED REVENUE | 6,190 | 5,908 | ||||||
| DEFERRED RENT | 5,661 | 901 | ||||||
| Total liabilities | 96,293 | 108,298 | ||||||
| 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; 12,807,086 and 12,782,907 shares issued at September 30, 2012 and December 31, 2011, respectively; and 12,780,225 and 12,764,546 shares outstanding as of September 30, 2012 and December 31, 2011, respectively |
13 | 13 | ||||||
| Additional paid-in capital | 105,707 | 104,645 | ||||||
| Accumulated deficit | (80,061 | ) | (77,898 | ) | ||||
| Accumulated other comprehensive income | 1,413 | 1,399 | ||||||
|
|
||||||||
|
Treasury stock at cost, 32,161 and 18,361 shares as of September 30, 2012 and December 31, 2011, respectively |
(121 | ) | (85 | ) | ||||
| Total shareholders' equity | 26,951 | 28,074 | ||||||
| Total liabilities and shareholders' equity | $ | 123,244 | $ | 136,372 | ||||
|
PFSweb, Inc. and Subsidiaries |
||||||||||||||||
| Unaudited Consolidating Statements of Operations | ||||||||||||||||
| For the Three Months Ended September 30, 2012 | ||||||||||||||||
| (In Thousands) | ||||||||||||||||
| Business & | ||||||||||||||||
| PFSweb | Retail Connect | Eliminations | Consolidated | |||||||||||||
| REVENUES: | ||||||||||||||||
| Product revenue, net | $ | - | $ | 27,619 | $ | - | $ | 27,619 | ||||||||
| Service fee revenue | 28,260 | - | - | 28,260 | ||||||||||||
| Service fee revenue - affiliate | 1,034 | - | (1,034 | ) | - | |||||||||||
| Pass-thru revenue | 10,654 | - | - | 10,654 | ||||||||||||
| Total revenues | 39,948 | 27,619 | (1,034 | ) | 66,533 | |||||||||||
| COSTS OF REVENUES: | ||||||||||||||||
| Cost of product revenue | - | 25,681 | - | 25,681 | ||||||||||||
| Cost of service fee revenue | 21,099 | - | (702 | ) | 20,397 | |||||||||||
| Cost of pass-thru revenue | 10,654 | - | - | 10,654 | ||||||||||||
| Total costs of revenues | 31,753 | 25,681 | (702 | ) | 56,732 | |||||||||||
| Gross profit | 8,195 | 1,938 | (332 | ) | 9,801 | |||||||||||
| SELLING, GENERAL AND ADMINISTRATIVE EXPENSES | 8,763 | 1,350 | (332 | ) | 9,781 | |||||||||||
| Income (loss) from operations | (568 | ) | 588 | - | 20 | |||||||||||
| INTEREST EXPENSE, NET | 49 | 187 | - | 236 | ||||||||||||
| Income (loss) before income taxes | (617 | ) | 401 | - | (216 | ) | ||||||||||
| INCOME TAX PROVISION (BENEFIT) | (23 | ) | 177 | - | 154 | |||||||||||
| NET INCOME (LOSS) | $ | (594 | ) | $ | 224 | $ | - | $ | (370 | ) | ||||||
| NON-GAAP NET INCOME (LOSS) | $ | (286 | ) | $ | 224 | $ | - | $ | (62 | ) | ||||||
| EBITDA | $ | 1,908 | $ | 614 | $ | - | $ | 2,522 | ||||||||
| ADJUSTED EBITDA | $ | 2,216 | $ | 614 | $ | - | $ | 2,830 | ||||||||
| A reconciliation of NET INCOME (LOSS) to EBITDA and ADJUSTED EBITDA follows: | ||||||||||||||||
| NET INCOME (LOSS) | $ | (594 | ) | $ | 224 | $ | - | (370 | ) | |||||||
| Income tax expense (benefit) | (23 | ) | 177 | - | 154 | |||||||||||
| Interest expense , net | 49 | 187 | - | 236 | ||||||||||||
| Depreciation and amortization | 2,476 | 26 | - | 2,502 | ||||||||||||
| EBITDA | $ | 1,908 | $ | 614 | $ | - | $ | 2,522 | ||||||||
| Stock-based compensation | 308 | - | - | 308 | ||||||||||||
| ADJUSTED EBITDA | $ | 2,216 | $ | 614 | $ | - | $ | 2,830 | ||||||||
| A reconciliation of NET INCOME (LOSS) to NON-GAAP NET INCOME (LOSS) follows: | ||||||||||||||||
| NET INCOME (LOSS) | $ | (594 | ) | $ | 224 | $ | - | $ | (370 | ) | ||||||
| Stock-based compensation | 308 | - | - | 308 | ||||||||||||
| NON-GAAP NET INCOME (LOSS) | $ | (286 | ) | $ | 224 | $ | - | $ | (62 | ) | ||||||
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 Nine Months Ended September 30, 2012 | ||||||||||||||||
| (In Thousands) | ||||||||||||||||
| Business & | ||||||||||||||||
| PFSweb | Retail Connect | Eliminations | Consolidated | |||||||||||||
| REVENUES: | ||||||||||||||||
| Product revenue, net | $ | - | $ | 91,901 | $ | - | $ | 91,901 | ||||||||
| Service fee revenue | 85,022 | - | - | 85,022 | ||||||||||||
| Service fee revenue - affiliate | 3,620 | - | (3,620 | ) | - | |||||||||||
| Pass-thru revenue | 32,882 | - | - | 32,882 | ||||||||||||
| Total revenues | 121,524 | 91,901 | (3,620 | ) | 209,805 | |||||||||||
| COSTS OF REVENUES: | ||||||||||||||||
| Cost of product revenue | - | 84,934 | - | 84,934 | ||||||||||||
| Cost of service fee revenue | 64,196 | - | (2,200 | ) | 61,996 | |||||||||||
| Cost of pass-thru revenue | 32,882 | - | - | 32,882 | ||||||||||||
| Total costs of revenues | 97,078 | 84,934 | (2,200 | ) | 179,812 | |||||||||||
| Gross profit | 24,446 | 6,967 | (1,420 | ) | 29,993 | |||||||||||
| SELLING, GENERAL AND ADMINISTRATIVE EXPENSES | 27,342 | 5,019 | (1,420 | ) | 30,941 | |||||||||||
| Income (loss) from operations | (2,896 | ) | 1,948 | - | (948 | ) | ||||||||||
| INTEREST EXPENSE (INCOME), NET | 140 | 618 | - | 758 | ||||||||||||
| Income (loss) before income taxes | (3,036 | ) | 1,330 | - | (1,706 | ) | ||||||||||
| INCOME TAX PROVISION (BENEFIT) | (92 | ) | 549 | - | 457 | |||||||||||
| NET INCOME (LOSS) | (2,944 | ) | 781 | - | (2,163 | ) | ||||||||||
| NON-GAAP NET INCOME (LOSS) | $ | (614 | ) | $ | 781 | $ | - | $ | 167 | |||||||
| EBITDA | $ | 3,872 | $ | 2,014 | $ | - | $ | 5,886 | ||||||||
| ADJUSTED EBITDA | $ | 6,202 | $ | 2,014 | $ | - | $ | 8,216 | ||||||||
| A reconciliation of NET INCOME (LOSS) to EBITDA and ADJUSTED EBITDA follows: | ||||||||||||||||
| NET INCOME (LOSS) | $ | (2,944 | ) | $ | 781 | $ | - | (2,163 | ) | |||||||
| Income tax expense (benefit) | (92 | ) | 549 | - | 457 | |||||||||||
| Interest expense (income) | 140 | 618 | - | 758 | ||||||||||||
| Depreciation and amortization | 6,768 | 66 | - | 6,834 | ||||||||||||
| EBITDA | $ | 3,872 | $ | 2,014 | $ | - | $ | 5,886 | ||||||||
| Stock-based compensation | 1,014 | - | - | 1,014 | ||||||||||||
| Lease termination costs | 450 | - | - | 450 | ||||||||||||
| Move related costs | 866 | - | - | 866 | ||||||||||||
| ADJUSTED EBITDA | $ | 6,202 | $ | 2,014 | $ | - | $ | 8,216 | ||||||||
| A reconciliation of NET INCOME (LOSS) to NON-GAAP NET INCOME (LOSS) follows: | ||||||||||||||||
| NET INCOME (LOSS) | $ | (2,944 | ) | $ | 781 | $ | - | $ | (2,163 | ) | ||||||
| Stock-based compensation | 1,014 | - | - | 1,014 | ||||||||||||
| Lease termination costs | 450 | - | - | 450 | ||||||||||||
| Move related costs | 866 | - | - | 866 | ||||||||||||
| NON-GAAP NET INCOME (LOSS) | $ | (614 | ) | $ | 781 | $ | - | $ | 167 | |||||||
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 and PFSweb Retail Connect include certain ongoing activity formerly reported as eCOST.
|
PFSweb, Inc. and Subsidiaries |
||||||||||||||||||||
| Unaudited Consolidating Statements of Operations | ||||||||||||||||||||
| For the Three Months Ended September 30, 2011 | ||||||||||||||||||||
| (In Thousands) | ||||||||||||||||||||
| Business & | ||||||||||||||||||||
| PFSweb | Retail Connect | eCOST | Eliminations | Consolidated | ||||||||||||||||
| REVENUES: | ||||||||||||||||||||
| Product revenue, net | $ | - | $ | 37,923 | $ | - | $ | - | $ | 37,923 | ||||||||||
| Service fee revenue | 22,949 | - | - | - | 22,949 | |||||||||||||||
| Service fee revenue - affiliate | 1,518 | - | - | (1,518 | ) | - | ||||||||||||||
| Pass-thru revenue | 9,999 | - | - | - | 9,999 | |||||||||||||||
| Total revenues | 34,466 | 37,923 | - | (1,518 | ) | 70,871 | ||||||||||||||
| COSTS OF REVENUES: | ||||||||||||||||||||
| Cost of product revenue | - | 35,304 | - | - | 35,304 | |||||||||||||||
| Cost of service fee revenue | 18,204 | - | - | (541 | ) | 17,663 | ||||||||||||||
| Cost of pass-thru revenue | 9,999 | - | - | - | 9,999 | |||||||||||||||
| Total costs of revenues | 28,203 | 35,304 | - | (541 | ) | 62,966 | ||||||||||||||
| Gross profit | 6,263 | 2,619 | - | (977 | ) | 7,905 | ||||||||||||||
| SELLING, GENERAL AND ADMINISTRATIVE EXPENSES | 8,398 | 1,964 | - | (977 | ) | 9,385 | ||||||||||||||
| Income (loss) from operations | (2,135 | ) | 655 | - | - | (1,480 | ) | |||||||||||||
| INTEREST EXPENSE (INCOME), NET | (30 | ) | 338 | - | - | 308 | ||||||||||||||
| Income (loss) before income taxes | (2,105 | ) | 317 | - | - | (1,788 | ) | |||||||||||||
| INCOME TAX PROVISION (BENEFIT) | (74 | ) | 131 | - | - | 57 | ||||||||||||||
| INCOME (LOSS) FROM CONTINUING OPERATIONS | (2,031 | ) | 186 | - | - | (1,845 | ) | |||||||||||||
| INCOME FROM DISCONTINUED OPERATIONS, NET OF TAX | - | - | 20 | 20 | ||||||||||||||||
| NET INCOME (LOSS) | $ | (2,031 | ) | $ | 186 | $ | 20 | $ | - | $ | (1,825 | ) | ||||||||
| NON-GAAP NET INCOME (LOSS) | $ | (1,685 | ) | $ | 186 | $ | - | $ | - | $ | (1,499 | ) | ||||||||
| EBITDA | $ | (606 | ) | $ | 663 | $ | - | $ | - | $ | 57 | |||||||||
| ADJUSTED EBITDA | $ | 44 | $ | 663 | $ | - | $ | - | $ | 707 | ||||||||||
| A reconciliation of NET INCOME (LOSS) to EBITDA and ADJUSTED EBITDA follows: | ||||||||||||||||||||
| NET INCOME (LOSS) | $ | (2,031 | ) | $ | 186 | $ | 20 | $ | - | (1,825 | ) | |||||||||
| Income from discontinued operations, net of tax | - | - | (20 | ) | - | (20 | ) | |||||||||||||
| Income tax expense (benefit) | (74 | ) | 131 | - | - | 57 | ||||||||||||||
| Interest expense (income) | (30 | ) | 338 | - | - | 308 | ||||||||||||||
| Depreciation and amortization | 1,529 | 8 | - | - | 1,537 | |||||||||||||||
| EBITDA | $ | (606 | ) | $ | 663 | $ | - | $ | - | $ | 57 | |||||||||
| Stock-based compensation | 346 | - | - | - | 346 | |||||||||||||||
| Relocation related costs | 304 | 304 | ||||||||||||||||||
| ADJUSTED EBITDA | $ | 44 | $ | 663 | $ | - | $ | - | $ | 707 | ||||||||||
| A reconciliation of NET INCOME (LOSS) to NON-GAAP NET INCOME (LOSS) follows: | ||||||||||||||||||||
| NET INCOME (LOSS) | $ | (2,031 | ) | $ | 186 | $ | 20 | $ | - | $ | (1,825 | ) | ||||||||
| Income from discontinued operations, net of tax | - | - | (20 | ) | - | (20 | ) | |||||||||||||
| Stock-based compensation | 346 | - | - | - | 346 | |||||||||||||||
| NON-GAAP NET INCOME (LOSS) | $ | (1,685 | ) | $ | 186 | $ | - | $ | - | $ | (1,499 | ) | ||||||||
|
|
||||||||||||||||||||
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 and PFSweb Retail Connect include certain ongoing activity formerly reported as eCOST.
|
PFSweb, Inc. and Subsidiaries |
||||||||||||||||||||
| Unaudited Consolidating Statements of Operations | ||||||||||||||||||||
| For the Nine Months Ended September 30, 2011 | ||||||||||||||||||||
| (In Thousands) | ||||||||||||||||||||
| Business & | ||||||||||||||||||||
| PFSweb | Retail Connect | eCOST | Eliminations | Consolidated | ||||||||||||||||
| REVENUES: | ||||||||||||||||||||
| Product revenue, net | $ | - | $ | 122,005 | $ | - | $ | - | $ | 122,005 | ||||||||||
| Service fee revenue | 62,819 | - | - | - | 62,819 | |||||||||||||||
| Service fee revenue - affiliate | 4,769 | - | - | (4,769 | ) | - | ||||||||||||||
| Pass-thru revenue | 26,446 | - | - | (2 | ) | 26,444 | ||||||||||||||
| Total revenues | 94,034 | 122,005 | - | (4,771 | ) | 211,268 | ||||||||||||||
| COSTS OF REVENUES: | ||||||||||||||||||||
| Cost of product revenue | - | 113,181 | - | - | 113,181 | |||||||||||||||
| Cost of service fee revenue | 48,904 | - | - | (1,663 | ) | 47,241 | ||||||||||||||
| Cost of pass-thru revenue | 26,446 | - | - | (2 | ) | 26,444 | ||||||||||||||
| Total costs of revenues | 75,350 | 113,181 | - | (1,665 | ) | 186,866 | ||||||||||||||
| Gross profit | 18,684 | 8,824 | - | (3,106 | ) | 24,402 | ||||||||||||||
| SELLING, GENERAL AND ADMINISTRATIVE EXPENSES | 24,974 | 6,235 | - | (3,106 | ) | 28,103 | ||||||||||||||
| Income (loss) from operations | (6,290 | ) | 2,589 | - | - | (3,701 | ) | |||||||||||||
| INTEREST EXPENSE (INCOME), NET | (146 | ) | 915 | - | - | 769 | ||||||||||||||
| Income (loss) before income taxes | (6,144 | ) | 1,674 | - | - | (4,470 | ) | |||||||||||||
| INCOME TAX PROVISION (BENEFIT) | (350 | ) | 637 | - | - | 287 | ||||||||||||||
| INCOME (LOSS) FROM CONTINUING OPERATIONS | (5,794 | ) | 1,037 | - | - | (4,757 | ) | |||||||||||||
| LOSS FROM DISCONTINUED OPERATIONS, NET OF TAX | - | - | (569 | ) | (569 | ) | ||||||||||||||
| NET INCOME (LOSS) | $ | (5,794 | ) | $ | 1,037 | $ | (569 | ) | $ | - | $ | (5,326 | ) | |||||||
| NON-GAAP NET INCOME (LOSS) | $ | (4,739 | ) | $ | 1,037 | $ | - | $ | - | $ | (3,702 | ) | ||||||||
| EBITDA | $ | (1,737 | ) | $ | 2,611 | $ | - | $ | - | $ | 874 | |||||||||
| ADJUSTED EBITDA | $ | (378 | ) | $ | 2,611 | $ | - | $ | - | $ | 2,233 | |||||||||
| A reconciliation of NET INCOME (LOSS) to EBITDA and ADJUSTED EBITDA follows: | ||||||||||||||||||||
| NET INCOME (LOSS) | $ | (5,794 | ) | $ | 1,037 | $ | (569 | ) | $ | - | (5,326 | ) | ||||||||
| Loss from discontinued operations, net of tax | - | - | 569 | - | 569 | |||||||||||||||
| Income tax expense (benefit) | (350 | ) | 637 | - | - | 287 | ||||||||||||||
| Interest expense (income) | (146 | ) | 915 | - | - | 769 | ||||||||||||||
| Depreciation and amortization | 4,553 | 22 | - | - | 4,575 | |||||||||||||||
| EBITDA | $ | (1,737 | ) | $ | 2,611 | $ | - | $ | - | $ | 874 | |||||||||
| Stock-based compensation | 1,055 | - | - | - | 1,055 | |||||||||||||||
| Relocation related costs | 304 | 304 | ||||||||||||||||||
| ADJUSTED EBITDA | $ | (378 | ) | $ | 2,611 | $ | - | $ | - | $ | 2,233 | |||||||||
| A reconciliation of NET INCOME (LOSS) to NON-GAAP NET INCOME (LOSS) follows: | ||||||||||||||||||||
| NET INCOME (LOSS) | $ | (5,794 | ) | $ | 1,037 | $ | (569 | ) | $ | - | $ | (5,326 | ) | |||||||
| Loss from discontinued operations, net of tax | - | - | 569 | - | 569 | |||||||||||||||
| Stock-based compensation | 1,055 | - | - | - | 1,055 | |||||||||||||||
| NON-GAAP NET INCOME (LOSS) | $ | (4,739 | ) | $ | 1,037 | $ | - | $ | - | $ | (3,702 | ) | ||||||||
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 and PFSweb Retail Connect include certain ongoing activity formerly reported as eCOST.
|
PFSweb, Inc. and Subsidiaries |
|||||||||||||||||
| Unaudited Condensed Consolidating Balance Sheets | |||||||||||||||||
| as of September 30, 2012 | |||||||||||||||||
| (In Thousands) | |||||||||||||||||
| Business & | |||||||||||||||||
| PFSweb | Retail Connect | Eliminations | Consolidated | ||||||||||||||
|
ASSETS |
|||||||||||||||||
| CURRENT ASSETS: | |||||||||||||||||
| Cash and cash equivalents | $ | 13,983 | $ | 3,810 | $ | - | $ | 17,793 | |||||||||
| Restricted cash | - | 471 | - | 471 | |||||||||||||
| Accounts receivable, net | 25,465 | 12,909 | (317 | ) | 38,057 | ||||||||||||
| Inventories, net | - | 25,453 | - | 25,453 | |||||||||||||
| Other receivables | - | 7,340 | - | 7,340 | |||||||||||||
| Prepaid expenses and other current assets | 3,182 | 1,481 | - | 4,663 | |||||||||||||
| Total current assets | 42,630 | 51,464 | (317 | ) | 93,777 | ||||||||||||
| PROPERTY AND EQUIPMENT, net | 25,325 | 214 | - | 25,539 | |||||||||||||
| RECEIVABLE/INVESTMENT IN AFFILIATES | 13,456 | - | (13,456 | ) | - | ||||||||||||
| OTHER ASSETS | 3,799 | 129 | - | 3,928 | |||||||||||||
| Total assets | 85,210 | 51,807 | (13,773 | ) | 123,244 | ||||||||||||
|
LIABILITIES AND SHAREHOLDERS EQUITY |
|||||||||||||||||
| CURRENT LIABILITIES: | |||||||||||||||||
| Current portion of long-term debt and capital lease obligations | $ | 12,003 | $ | 7,070 | $ | - | $ | 19,073 | |||||||||
| Trade accounts payable | 8,461 | 25,293 | (317 | ) | 33,437 | ||||||||||||
| Deferred revenue | 6,781 | 27 | - | 6,808 | |||||||||||||
| Accrued expenses | 13,336 | 6,017 | - | 19,353 | |||||||||||||
| Total current liabilities | 40,581 | 38,407 | (317 | ) | 78,671 | ||||||||||||
| LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS, less current portion | 5,725 | 46 | - | 5,771 | |||||||||||||
| PAYABLE TO AFFILIATES | - | 22,795 | (22,795 | ) | - | ||||||||||||
| DEFERRED REVENUE | 6,190 | - | - | 6,190 | |||||||||||||
| DEFERRED RENT | 5,629 | 32 | - | 5,661 | |||||||||||||
| Total liabilities | 58,125 | 61,280 | (23,112 | ) | 96,293 | ||||||||||||
| COMMITMENTS AND CONTINGENCIES | |||||||||||||||||
| SHAREHOLDERS' EQUITY: | |||||||||||||||||
| Common stock | 13 | 19 | (19 | ) | 13 | ||||||||||||
| Capital contributions | - | 1,000 | (1,000 | ) | - | ||||||||||||
| Additional paid-in capital | 105,707 | 28,059 | (28,059 | ) | 105,707 | ||||||||||||
| Retained earnings (accumulated deficit) | (79,920 | ) | (40,630 | ) | 40,489 | (80,061 | ) | ||||||||||
| Accumulated other comprehensive income | 1,406 | 2,079 | (2,072 | ) | 1,413 | ||||||||||||
| Treasury stock | (121 | ) | - | - | (121 | ) | |||||||||||
| Total shareholders' equity | 27,085 | (9,473 | ) | 9,339 | 26,951 | ||||||||||||
| Total liabilities and shareholders' equity | $ | 85,210 | $ | 51,807 | $ | (13,773 | ) | $ | 123,244 | ||||||||
|
PFSweb, Inc. and Subsidiaries |
|||||||||||||||||
| Unaudited Condensed Consolidating Balance Sheets | |||||||||||||||||
| as of December 31, 2011 | |||||||||||||||||
| (In Thousands) | |||||||||||||||||
| Business & | |||||||||||||||||
| PFSweb | Retail Connect | Eliminations | Consolidated | ||||||||||||||
|
ASSETS |
|||||||||||||||||
| CURRENT ASSETS: | |||||||||||||||||
| Cash and cash equivalents | $ | 12,818 | $ | 4,877 | $ | - | $ | 17,695 | |||||||||
| Restricted cash | 138 | 689 | - | 827 | |||||||||||||
| Accounts receivable, net | 35,881 | 17,133 | (335 | ) | 52,679 | ||||||||||||
| Inventories, net | - | 30,487 | - | 30,487 | |||||||||||||
| Other receivables | - | 11,915 | - | 11,915 | |||||||||||||
| Prepaid expenses and other current assets | 3,273 | 1,424 | - | 4,697 | |||||||||||||
| Total current assets | 52,110 | 66,525 | (335 | ) | 118,300 | ||||||||||||
| PROPERTY AND EQUIPMENT, net | 14,884 | 61 | - | 14,945 | |||||||||||||
| RECEIVABLE/INVESTMENT IN AFFILIATES | 13,130 | - | (13,130 | ) | - | ||||||||||||
| OTHER ASSETS | 2,973 | 154 | - | 3,127 | |||||||||||||
| Total assets | 83,097 | 66,740 | (13,465 | ) | 136,372 | ||||||||||||
|
LIABILITIES AND SHAREHOLDERS EQUITY |
|||||||||||||||||
| CURRENT LIABILITIES: | |||||||||||||||||
| Current portion of long-term debt and capital lease obligations | $ | 13,918 | $ | 10,021 | $ | - | $ | 23,939 | |||||||||
| Trade accounts payable | 12,089 | 36,790 | (335 | ) | 48,544 | ||||||||||||
| Deferred revenue | 6,749 | 17 | - | 6,766 | |||||||||||||
| Accrued expenses | 11,998 | 6,659 | - | 18,657 | |||||||||||||
| Total current liabilities | 44,754 | 53,487 | (335 | ) | 97,906 | ||||||||||||
| LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS, less current portion | 3,513 | 70 | - | 3,583 | |||||||||||||
| PAYABLE TO AFFILIATES | - | 22,495 | (22,495 | ) | - | ||||||||||||
| DEFERRED REVENUE | 5,908 | - | - | 5,908 | |||||||||||||
| DEFERRED RENT | 901 | - | - | 901 | |||||||||||||
| Total liabilities | 55,076 | 76,052 | (22,830 | ) | 108,298 | ||||||||||||
| COMMITMENTS AND CONTINGENCIES | |||||||||||||||||
| SHAREHOLDERS' EQUITY: | |||||||||||||||||
| Common stock | 13 | 19 | (19 | ) | 13 | ||||||||||||
| Capital contributions | - | 1,000 | (1,000 | ) | - | ||||||||||||
| Additional paid-in capital | 104,645 | 28,059 | (28,059 | ) | 104,645 | ||||||||||||
| Retained earnings (accumulated deficit) | (77,950 | ) | (40,446 | ) | 40,498 | (77,898 | ) | ||||||||||
| Accumulated other comprehensive income | 1,398 | 2,056 | (2,055 | ) | 1,399 | ||||||||||||
| Treasury stock | (85 | ) | - | - | (85 | ) | |||||||||||
| Total shareholders' equity | 28,021 | (9,312 | ) | 9,365 | 28,074 | ||||||||||||
| Total liabilities and shareholders' equity | $ | 83,097 | $ | 66,740 | $ | (13,465 | ) | $ | 136,372 | ||||||||