Asure Software Inc.
ASURE SOFTWARE INC (Form: 8-K, Received: 03/25/2015 10:35:12)


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
 

 
FORM 8-K
 

 
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 
Date of Report (Date of earliest event reported): March 25, 2015
 
ASURE SOFTWARE, INC.
(Exact name of registrant as specified in charter)
 
Delaware
0-20008
74-2415696
(State or other jurisdiction of incorporation or organization)
(Commission File No.)
(IRS Employer Identification No.)
 
110 Wild Basin Road, Suite 100, Austin, Texas 78746
(Address of principal executive offices)
 
512-437-2700
(Registrant’s telephone number, including area code)
 
N/A
(Former Name and Address)
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
 
o             Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
 
o             Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
 
o             Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
 
o             Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
 
 

 
 
Item 2.02. Results of Operations and Financial Condition.

On March 25, 2015, Asure Software, Inc. (the “Company”) issued a press release announcing its financial results for its fourth quarter and fiscal year ended December 31, 2014. A copy of this press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.
 
The information contained in this Item 2.02 of this Current Report (including the press release furnished as an exhibit hereto) shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
 
Item 9.01. Financial Statements and Exhibits.

  (d)           Exhibits
 
EXHIBIT NUMBER
 
DESCRIPTION
99.1
 
 
 
 
 
 

 
 
SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

ASURE SOFTWARE, INC.
 
Dated: March 25, 2015                                                  By        /s/ Brad Wolfe                                                      
    Brad Wolfe, Chief Financial Officer
 
 
 
 
 

 
Exhibit 99.1
 
Asure Software Reports Solid Financial Results for
Fourth Quarter and Fiscal Year 2014
Company Announces Guidance and Projected Growth for 2015
 
In thousands, except per share data
  Q4 2014     Q4 2013  
% Change
 
YTD Q4 2014
   
YTD Q4 2013
 
% Change
Revenue
  $ 7,101     $ 6,732  
up 6%
  $ 27,206     $ 25,474  
up 7%
Gross Margin
  $ 5,313     $ 5,108  
up 4%
  $ 20,892     $ 19,049  
up 10%
Net income (loss)
  $ 92     $ (102 )
up 190%
  $ (262 )   $ (1,662 )
up 84%
EBITDA, excluding one-times*
  $ 1,345     $ 1,482  
down 9%
  $ 5,052     $ 4,823  
up 5%
Diluted net income (loss) per share, excluding one-times*
  $ 0.04     $ 0.02       $ 0.08     $ (0.14 )  

AUSTIN, Texas, March 25, 2015 (GLOBE NEWSWIRE) -- Asure Software, Inc. (Nasdaq:ASUR), a leading provider of workplace management software, announced results for the fourth quarter ended December 31, 2014.
 
Strategic Highlights
·  
Continued cloud bookings and revenue growth with US and UK key sales and upgrades that included a combination of Cloud-based solutions, professional services and integrated hardware: AsureSpace hoteling and workspace management to American Water Works, Deutsche Bank, Kaiser Permanente, King Saud University and Methodist Hospital, and AsureForce time and attendance solutions to Clear Creek Plumbing, Croes and Co., Dynamex, Henriquez, Rhodes College, Pollard Brook and Vision Ease.

·  
Total bookings for 2014 increased 23% over 2013. Cloud bookings for 2014 increased 1% over 2013.

·  
Released an enhanced NowSpace™ space scheduling touch panel, integrated NowSpace with leading technology provider Mobile Iron, and launched bi-directional integration of Asure hoteling and space management solutions with Cisco TMS; expanded AsureForce time & attendance solutions with enhanced support for global and high volume implementations, including numerous usability and performance requirements.

·  
Expanded the Company’s global presence with Tokyo-based DOUMA, Japan’s only firm dedicated solely to workplace management, which will offer Asure’s solutions to its clients.

·  
Refinanced our senior debt under a new facility with Wells Fargo Bank, N.A. in the first quarter of 2014, reducing our interest expense by $0.6 million and cash principal payments by $0.8 million in 2014.

·  
Net income was $0.01 per share in the fourth quarter of 2014 as compared to net loss of $(0.02) per share in the fourth quarter of 2013. This was the third quarter in a row of positive net income.

Results
·  
Cloud SaaS-based revenue for the quarter was $3.5 million, up $72,000 or 2% over the fourth quarter of 2013.

·  
Revenue for the quarter of $7.1 million increased 6% over the $6.7 million in the fourth quarter of 2013.

·  
Recurring revenue as a percent of total revenue was 73% for the quarter as compared to 75% in the fourth quarter of 2013.

·  
Gross margin for the quarter was $5.3 million compared to $5.1 million in the fourth quarter 2013, an increase of 4%.

·  
EBITDA* excluding one-time items* for the quarter was approximately $1.3 million compared to $1.5 million in the fourth quarter of 2013. This decline was driven by an increase in sales, marketing, and operating expenses aimed towards accelerating 2015 growth.

·  
Fourth quarter net income per share, excluding one-times*, was $0.04 compared to $0.02 in the fourth quarter of 2013.
 
 
 

 

Management Commentary

Pat Goepel , Chief Executive Officer of Asure Software commented, “2014 and the fourth quarter were successful for Asure Software. We transitioned to a profitable company, with growth for three consecutive quarters and 7% annual organic revenue growth. Our success was driven by maintaining a constant focus on sales and upgrades of SaaS-based solutions, expanding the company’s national and global presences, and delivering first-to-market technology features that offer clients differentiated solutions to manage hoteling and mobile workforce initiatives.

We increased investments in sales, marketing and operating expenses, which have resulted in stronger market awareness and higher sales, particularly with large multinational companies. With over 5,000 clients in over 80 countries, our global presence is sound; and our investments set the stage for continued sales growth in the global enterprise market.

In addition to global sales expansion, we expect consistent growth through customer upgrades to Cloud solutions, new sales in the mid-markets, and expanded global partnerships. Additionally, we’ve put a sound technology platform in place, which firmly sets Asure’s focus as a leader in SaaS-based mobile workforce solutions. Cumulatively, these successes and strategic investments put us in an ideal situation for significant future growth.”

Brad Wolfe, Asure’s Chief Financial Officer added, “2014 was an important year for Asure as the company has transitioned to a profitable company that is poised for growth. For 2015, we are announcing guidance of $30.0 million for revenue, $5.6 million for EBITDA excluding one-time items, and $0.25 for net income per share excluding one-time items. This reflects our confidence in continued market demand, the stability of our products, and the company’s ability to deliver differentiated offerings on a global, scalable basis.”

Please see below for details around Asure’s financial results.

Company Outlook
$ 000s    
FY 15
 
Revenue
    $ 30,000  
EBITDA, excluding one-time items
    $ 5,600  
Net income per share, excluding one-time items
    $ 0.25  

Conference Call Details
Asure will follow this announcement with a conference call for the investment community on Wednesday, March 25, 2015 at 11:00 a.m. EDT, (10:00 a.m. CDT) to further discuss the quarter and outlook. Participating in the call will be Pat Goepel , Chief Executive Officer and Brad Wolfe , Chief Financial Officer. To participate, dial (877) 853-5636   ten minutes before the call begins. International callers should dial (631) 291-4544. The conference ID for all callers is 1497865.
 
Investors, analysts, media and the general public will also have the opportunity to listen to the conference call in listen-only mode via the Internet by visiting the investor relations page of Asure's web site at www.asuresoftware.com . To monitor the live call, please visit the web site at least ten minutes early to register, download and install any necessary audio software. For those who cannot listen to the live broadcast, a replay will be available shortly after the call on the investor relations page of our Web site at http://investor.asuresoftware.com/
 
About Asure Software
Asure Software, Inc. , (Nasdaq:ASUR) is headquartered in Austin, Texas with regional headquarters in London, England. Asure helps companies better manage their global, mobile workforces with SaaS-based solutions that bring people, time, space and assets together in a meaningful way. The company serves approximately 6,000 clients worldwide with workplace and workforce management solutions that offer innovative ways to help meet the needs of an agile workforce. For more information, please visit www.asuresoftware.com .

The Asure Software, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=11986
 
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995:
 
Statements in this press release regarding Asure's business which are not historical facts are "forward-looking statements" that involve risks and uncertainties. Such risks and uncertainties could cause actual results to differ from those contained in the forward-looking statements.
 

For more information contact:

Brad Wolfe, CFO
Asure Software, Inc.
888-323-8835
bwolfe@asuresoftware.com
 
 
 

 
 
ASURE SOFTWARE, INC.
CONSOLIDATED BALANCE SHEETS
(Amounts in thousands)
 
  
 
December 31,
2014
   
December 31,
2013
 
Assets
             
Current assets:
             
Cash and cash equivalents
 
$
320
   
$
3,938
 
Restricted cash
   
-
     
400
 
Accounts receivable, net of allowance for doubtful accounts of $120 and $168 at December 31, 2014 and December 31, 2013, respectively
   
5,295
     
3,902
 
Inventory
   
170
     
77
 
Notes receivable
   
-
     
9
 
Prepaid expenses and other current assets
   
1,303
     
 1,334
 
Total current assets
   
7,088
     
9,660
 
Property and equipment, net
   
1,539
     
1,233
 
Goodwill
   
17,500
     
15,005
 
Intangible assets, net
   
8,322
     
9,679
 
Other assets
   
19
     
38
 
Total assets
 
$
       34,468
   
$
35,615
 
Liabilities and stockholders’ equity
               
Current liabilities:
               
Current portion of notes payable
 
$
750
   
$
4,308
 
Accounts payable
   
1,533
     
1,669
 
Accrued compensation and benefits
   
350
     
473
 
Other accrued liabilities
   
1,128
     
988
 
Deferred revenue
   
10,641
     
10,059
 
Total current liabilities
   
14,402
     
17,497
 
Long-term liabilities:
               
Deferred revenue
   
475
     
759
 
Notes payable
   
14,381
     
12,698
 
Other liabilities
   
739
     
444
 
Total long-term liabilities
   
15,595
     
13,901
 
Stockholders’ equity:
               
Preferred stock, $.01 par value; 1,500 shares authorized; none issued or outstanding
   
-
     
-
 
Common stock, $.01 par value; 11,000 shares authorized; 6,434 and 6,353 shares issued,
6,050 and 5,969 shares outstanding at December 31, 2014 and December 31, 2013, respectively
   
64
     
63
 
Treasury stock at cost, 384 shares at December 31, 2014 and December 31, 2013
   
(5,017
)
   
(5,017
)
Additional paid-in capital
   
278,656
     
278,159
 
Accumulated deficit
   
(269,146
)
   
(268,884
)
Accumulated other comprehensive loss
   
(86
)
   
(104
)
Total stockholders’ equity
   
4,471
     
4,217
 
Total liabilities and stockholders’ equity
 
$
34,468
   
$
35,615
 
 
 
 
 

 
 
ASURE SOFTWARE, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(Amounts in thousands, except share and per share data)

   
FOR THE
TWELVE MONTHS ENDED
DECEMBER 31,
 
   
2014
   
2013
 
Revenues
 
$
27,206
   
$
25,474
 
Cost of Sales
   
6,314
     
6,425
 
Gross margin
   
20,892
     
19,049
 
                 
Operating expenses
               
Selling, general and administrative
   
13,999
     
13,252
 
Research and development
   
3,310
     
2,835
 
Amortization of intangible assets
   
1,999
     
2,180
 
Total operating expenses
   
19,308
     
18,267
 
                 
Income from operations
   
1,584
     
782
 
                 
Other income (loss)
               
Gain on settlement of note payable and litigation
   
1,034
     
-
 
Interest income
   
(1
)
   
49
 
Gain on sale/disposal of assets
   
-
     
72
 
Loss on debt refinancing
   
(1,402
)
   
-
 
Foreign currency translation loss
   
(14
)
   
(24
)
Interest expense and other
   
(1,274
)
   
(1,943
)
Interest expense- amortization of original issue discount (OID)
   
(72
)
   
(481
)
Total other loss, net
   
(1,729
)
   
(2,327
)
                 
Loss from operations before income taxes
   
(145
)
   
(1,545
)
Income tax provision
   
(117
)
   
(117
)
Net loss
 
$
(262
)
 
$
(1,662
)
Other comprehensive loss:
               
Foreign currency translation gain (loss)
   
18
     
(2
)
Other comprehensive loss
 
$
(244
)
 
$
(1,664
)
                 
Basic and diluted net loss per share
               
Basic
 
$
(0.04
)
 
$
(0.29
)
Diluted
 
$
(0.04
)
 
$
(0.29
)
Weighted average basic and diluted shares
               
Basic
   
6,002,000
     
5,661,000
 
Diluted
   
6,002,000
     
5,661,000
 
 
 
 
 

 
 
ASURE SOFTWARE, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in thousands)
 
   
FOR THE
YEAR ENDED
DECEMBER 31,
 
   
2014
   
2013
 
CASH FLOWS FROM OPERATING ACTIVITIES:
           
Net loss
 
$
(262
)
 
$
(1,662
)
Adjustments to reconcile net loss to net cash provided by operations:
               
Depreciation and amortization
   
2,821
     
2,947
 
Provision for doubtful accounts
   
48
     
37
 
Share-based compensation
   
226
     
160
 
Interest income on settlement
   
-
     
(48
)
Gain on sale/disposal of assets
   
-
     
(72
)
Amortization of original issue discount (OID)
   
72
     
481
 
Gain on debt payoff
   
-
     
(98
)
Gain on settlement of note payable and litigation
   
(1,034
)
   
-
 
Loss on debt refinancing
   
1,402
     
-
 
Changes in operating assets and liabilities:
               
Restricted cash
   
400
     
(150
)
Accounts receivable
   
(1,419
)
   
(899
)
Inventory
   
(93
)
   
177
 
Prepaid expenses and other assets
   
(82
)
   
495
 
Accounts payable
   
(136
)
   
(1,008
)
Accrued expenses and other long-term obligations
   
550
     
737
 
Deferred revenue
   
213
     
928
 
Net cash provided by operating activities
   
2,706
     
2,025
 
                 
CASH FLOWS FROM INVESTING ACTIVITIES:
               
Acquisitions, net of cash acquired
   
(3,440
)
   
-
 
Purchases of property and equipment
   
(807
)
   
(383
)
Disposals of property and equipment
   
38
     
-
 
Collection of note receivable
   
9
     
10
 
Purchases of intangible assets
   
-
     
(62
)
Net cash used in investing activities
   
(4,200
)
   
(435
)
                 
CASH FLOWS FROM FINANCING ACTIVITIES:
               
Proceeds from notes payable
   
18,181
     
4,000
 
Payments on notes payable
   
(19,311
)
   
(6,880
)
Payments on amendment of senior notes payable
   
(704
)
   
(330
)
Debt financing fees
   
(565
)
   
-
 
Payments on capital leases
   
(144
)
   
(88
)
Insurance proceeds for settlement of notes payable dispute, net of expenses
   
372
     
-
 
Net proceeds from issuance of common stock
   
-
     
3,433
 
Net proceeds from exercise of stock options
   
24
     
35
 
Net cash provided by (used in) financing activities
   
(2,147
)
   
170
 
                 
Effect of foreign exchange rates
   
23
     
1
 
                 
Net increase (decrease) in cash and cash equivalents
   
(3,618
)
   
1,761
 
Cash and cash equivalents at beginning of period
   
3,938
     
2,177
 
Cash and cash equivalents at end of period
 
$
320
   
$
3,938
 
                 
SUPPLEMENTAL INFORMATION:
               
Cash paid for:
               
Interest
 
$
941
   
$
1,461
 
                 
Non-cash Investing and Financing Activities:
               
Conversion of subordinated convertible notes payable to equity
   
248
     
93
 
Accrued contingent consideration upon acquisition
   
327
     
-
 
 
 
 

 

*Non-GAAP Financial Measures
This press release includes the following financial measures defined as non-GAAP financial measures by the Securities and Exchange Commission: EBITDA and GAAP Net Income/(Loss) excluding one-time items. These supplemental financial measures are not required by GAAP, nor is the presentation of this financial information intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. Management recognizes that non-GAAP financial measures have limitations in that they do not reflect all of the items associated with Asure's earnings results as determined in accordance with GAAP. However, for the reasons described below, management uses these non-GAAP measures to evaluate the performance of Asure's business. Asure's management believes that it is important to provide investors with these same tools, together with reconciliation to GAAP, for evaluating the performance of Asure's business, as it may provide additional insight into Asure's financial results. See the “Reconciliation of GAAP Net Income/(Loss) to Earnings Before Interest, Taxes, Depreciation, Amortization and Stock Compensation Expense (EBITDA)” and the “Reconciliation of GAAP Net Income/(Loss) to Net Earnings Excluding One-Time Items” tables included in this press release for further information regarding these non-GAAP financial measures. In addition, these measures are presented because management believes they are frequently used by securities analysts, investors and others in the evaluation of companies. EBITDA is calculated by adding income taxes, interest expense, depreciation and amortization and stock compensation expense to net earnings. EBITDA is not defined under GAAP and should not be considered in isolation or as a substitute for net earnings and other consolidated earnings data prepared in accordance with GAAP or as a measure of Asure's profitability.

Net Earnings Excluding One-Time Items is calculated by combining the company’s GAAP Net Earnings, or earnings per share, with items that are one time in nature and are not expected to recur on a dollar or per share basis.
 
Free Cash Flow is computed by subtracting capital expenditures from cash flow from operations, each as determined in accordance with GAAP and as reflected in the statement of cash flows.

Non-GAAP Revenue is computed by adding back the deferred revenue fair market valuation to GAAP revenue.

Reconciliation of GAAP Net Earnings to Earnings Before Interest, Taxes, Depreciation, Amortization and Stock Compensation Expense (EBITDA) and EBITDA Excluding One-time items.

FOR THE THREE MONTHS ENDED

$000s
 
December 31,
2014
   
December 31,
2013
 
Net Income (Loss)
    92       (102 )
Interest and amortization of OID
    275       613  
Tax
    (23 )     (4 )
Depreciation
    126       121  
Amortization
    635       592  
Stock Compensation
    95       47  
EBITDA
    1,200       1,267  
   One-time items
    145       215  
EBITDA excluding one-time items
    1,345       1,482  

FOR THE TWELVE MONTHS ENDED
 
$000s   December 31,
2014
    December 31,
2013
 
Net Income (Loss)
    (262 )     (1,662 )
Interest and amortization of OID
    1,354       2,394  
Tax
    117       117  
Depreciation
    462       452  
Amortization
    2,359       2,495  
Stock Compensation
    226       160  
EBITDA
    4,256       3,956  
   One-time items
    796       867  
EBITDA excluding one-time items
    5,052       4,823  
 
 
 

 
 
Reconciliation of GAAP Net Earnings to Net Earnings Excluding One-time items
 
$000s
 
FOR THE THREE MONTHS ENDED
December 31
 
   
2014
   
2013
 
Net Income (Loss)
    92       (102 )
Legal & Professional Services
    21       163  
Severance, Recruitment & Relocation
    111       52  
Other one-time items (net)
    13       -  
 Sub-total excluding Taxes
    145       215  
Sub-total one-time items
    145       215  
Net Income (Loss) excluding one-time items
    237       113  
 
$000s
 
FOR THE TWELVE MONTHS ENDED
December 31
 
   
2014
   
2013
 
Net Income (Loss)
    (262 )     (1,662 )
Legal & Professional Services
    208       697  
Loss on Debt Refinancing
    1,402       -  
Gain on Settlement of Note Payable and litigation
    (1,034 )     -  
Severance, Recruitment & Relocation
    195       212  
Gain on sale of assets
    -       (72 )
Interest income from settlement
    -       (48 )
Other one-time items (net)
    25       78  
 Sub-total excluding Taxes
    796       867  
Sub-total one-time items
    796       867  
Net Income (Loss) excluding one-time items
    534       (795 )
 
 
 

 
 
Reconciliation of GAAP Revenue to Non-GAAP revenue

$000s
 
FOR THE THREE MONTHS ENDED
 December 31
 
   
2014
   
2013
 
Revenue
    7,101       6,732  
Adjustment
    -       13  
Non- GAAP revenue
    7,101       6,745  

$000s
 
FOR THE TWELVE MONTHS ENDED
 December 31
 
   
2014
   
2013
 
Revenue
    27,206       25,474  
Adjustment
    -       416  
Non- GAAP revenue
    27,206       25,890  
 
Note – Adjustment relates to the fair market valuation for assumed deferred revenue contracts that were not recognized in the period due to business combination accounting rules.