Asure Software Reports Record Revenue and Solid Financial Results for 2015 Second Quarter
| In thousands, except per share data | Q2 2015 | Q2 2014 | % Change | YTD Q2 2015 | YTD Q2 2014 | % Change |
| Revenue | $7,159 | $6,548 | up 9% | $13,491 | $13,075 | up 3% |
| Gross Margin | $5,280 | $5,175 | up 2% | $9,960 | $10,144 | down 2% |
| Net income (loss) | $95 | $15 | up 533% | ($388) | ($515) | up 25% |
| EBIDTA, excluding one-times* | $1,385 | $1,179 | up 18% | $2,357 | $2,319 | up 2% |
| Diluted net income (loss) per share, excluding one-times* | $0.04 | $0.02 | $0.00 | $0.00 | ||
AUSTIN, Texas, Aug. 12, 2015 (GLOBE NEWSWIRE) -- Asure Software, Inc. (Nasdaq:ASUR), a leading provider of workplace management software, announced results for the second quarter ended June 30, 2015.
Strategic Highlights
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Hoteling demand continues to increase - closed on seven hoteling deals, including solutions for Fiserv, Genpact, and Rogers Communications.
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Migrated 89 clients from on-premise to on-demand products, representing a 46% increase over the same quarter last year.
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Previously arranged multi-year technology transfer agreement with MPAY, agreed to in 2012, resulted in recognizing revenue of $200,000 this quarter with $600,000 of deferred revenue to be recognized ratably over the next three years.
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Implemented a strategic channel sales strategy which led to the signing of one of the largest IT integrators in South Africa and another in Brazil.
- The company is introducing backlog as a metric this quarter. The quantification of backlog will lead to more transparency and visibility of revenue growth. We define backlog as sales bookings that have not yet turned into revenue or deferred revenue, including both repetitive and non-repetitive product lines. For repetitive products, one year's value is included in backlog. Backlog at June 30, 2015 is $2.2 million.
Results
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Cloud bookings, including PSSI, decreased by 23% from the second quarter of 2014, but increased by 103%, excluding PSSI.
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Revenue for the quarter was $7.2 million as compared to $6.5 million in the second quarter of 2014, an increase of 9%.
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Recurring revenue as a percent of total revenue was 70% for the quarter as compared to 78% in the second quarter of 2014. This decrease is primarily the result of a shift in our revenue mix due to strong hardware and professional services revenue in the quarter.
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Gross margin for the quarter was $5.3 million compared to $5.2 million in the second quarter of 2014, an increase of 2%.
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EBITDA* excluding one-time items* for the quarter was approximately $1.4 million compared to $1.2 million in the second quarter of 2014, an increase of 18%.
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Second quarter net income per share, excluding one-times*, was $0.04 compared to $0.02 in the second quarter of 2014.
- Cash flow provided by operating activities for the quarter was $316,000 compared to $676,000 in the second quarter of 2014, representing a decrease of 53%. Cash flow provided by operating activities year to date was $862,000 compared to $747,000 in the first half of 2014, an increase of 15%.
Pat Goepel, Chief Executive Officer of Asure Software commented, "We are continuing to see the growth of the hoteling, hotdesking, and mobile workforce around the world. With recent wins across numerous Fortune 1000 companies over the last four months, we are well positioned to build on this momentum going into the last half of the year. As we anticipated, we solved our hardware inventory delay challenges. We're really starting to hit our stride and are excited to see the continuation of the progress we've made this quarter as we work to sign additional technology partners, continue to innovate our products, work through our partner channels and as more of the market understands the scope of the products and services we provide in supporting the digital workplace. "
Brad Wolfe, Asure's Chief Financial Officer added, "The Company is well-positioned to drive bookings growth, revenue and EBITDA moving forward. We expect to continue our Q2 performance throughout the remainder of year and forward. Accordingly, we reaffirm our 2015 guidance as stated in our fourth quarter 2014 earnings release."
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, August 12, 2015 at 11:00 a.m. ET, (10:00 a.m. CT) 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 98756427.
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, an archived replay will be available shortly after the call 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 cloud-based and mobile 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.
| ASURE SOFTWARE, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Amounts in thousands) (Unaudited) | ||
| June 30, 2015 | December 31, 2014 | |
| Assets | ||
| Current assets: | ||
| Cash and cash equivalents | $ 213 | $ 320 |
| Accounts receivable, net of allowance for doubtful accounts of $128 and $120 at June 30, 2015 and December 31, 2014, respectively | 5,159 | 5,295 |
| Inventory | 313 | 170 |
| Prepaid expenses and other current assets | 1,516 | 1,303 |
| Total current assets | 7,201 | 7,088 |
| Property and equipment, net | 2,188 | 1,539 |
| Goodwill | 17,441 | 17,500 |
| Intangible assets, net | 7,096 | 8,322 |
| Other assets | 803 | 19 |
| Total assets | $ 34,729 | $ 34,468 |
| Liabilities and stockholders' equity | ||
| Current liabilities: | ||
| Current portion of notes payable | $ 844 | $ 750 |
| Accounts payable | 2,124 | 1,533 |
| Accrued compensation and benefits | 239 | 350 |
| Other accrued liabilities | 989 | 1,128 |
| Deferred revenue | 10,409 | 10,641 |
| Total current liabilities | 14,605 | 14,402 |
| Long-term liabilities: | ||
| Deferred revenue | 833 | 475 |
| Notes payable | 13,928 | 14,381 |
| Other liabilities | 631 | 739 |
| Total long-term liabilities | 15,392 | 15,595 |
| Stockholders' equity: | ||
| Preferred stock, $.01 par value; 1,500 shares authorized; none issued or outstanding | -- | -- |
| Common stock, $.01 par value; 11,000 shares authorized; 6,674 and 6,434 shares issued, 6,290 and 6,050 shares outstanding at June 30, 2015 and December 31, 2014, respectively | 67 | 64 |
| Treasury stock at cost, 384 shares at June 30, 2015 and December 31, 2014 | (5,017) | (5,017) |
| Additional paid-in capital | 279,337 | 278,656 |
| Accumulated deficit | (269,534) | (269,146) |
| Accumulated other comprehensive loss | (121) | (86) |
| Total stockholders' equity | 4,732 | 4,471 |
| Total liabilities and stockholders' equity | $ 34,729 | $ 34,468 |
| ASURE SOFTWARE, INC. CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Amounts in thousands, except share and per share data) (Unaudited) | ||||
| FOR THE THREE MONTHS ENDED June 30, | FOR THE SIX MONTHS ENDED June 30, | |||
| 2015 | 2014 | 2015 | 2014 | |
| Revenues | $ 7,159 | $ 6,548 | $ 13,491 | $ 13,075 |
| Cost of sales | 1,879 | 1,373 | 3,531 | 2,931 |
| Gross margin | 5,280 | 5,175 | 9,960 | 10,144 |
| Operating expenses | ||||
| Selling, general and administrative | 3,612 | 3,495 | 7,061 | 6,857 |
| Research and development | 743 | 855 | 1,481 | 1,576 |
| Amortization of intangible assets | 504 | 497 | 1,009 | 994 |
| Total operating expenses | 4,859 | 4,847 | 9,551 | 9,427 |
| Income from operations | 421 | 328 | 409 | 717 |
| Other income (loss) | ||||
| Loss on lease termination | -- | -- | (110) | -- |
| Gain on settlement of note payable and litigation | -- | -- | -- | 1,034 |
| Loss on debt refinancing | -- | -- | -- | (1,402) |
| Foreign currency translation gain (loss) | 3 | (10) | (8) | (12) |
| Interest expense and other | (279) | (264) | (561) | (721) |
| Interest expense- amortization of original issue discount (OID) | (8) | (4) | (16) | (54) |
| Total other loss, net | (284) | (278) | (695) | (1,155) |
| Income (loss) from operations before income taxes | 137 | 50 | (286) | (438) |
| Income tax provision | (42) | (35) | (102) | (77) |
| Net income (loss) | $ 95 | $ 15 | $ (388) | $ (515) |
| Other comprehensive income (loss): | ||||
| Foreign currency loss | (41) | (10) | (35) | (18) |
| Other comprehensive income (loss) | $ 54 | $ 5 | $ (423) | $ (533) |
| Basic and diluted net income (loss) per share | ||||
| Basic | $ 0.02 | $ 0.00 | $ (0.06) | $ (0.09) |
| Diluted | $ 0.02 | $ 0.00 | $ (0.06) | $ (0.09) |
| Weighted average basic and diluted shares | ||||
| Basic | 6,066,000 | 5,979,000 | 6,061,000 | 5,975,000 |
| Diluted | 6,231,000 | 6,364,000 | 6,061,000 | 5,975,000 |
| ASURE SOFTWARE, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Amounts in thousands) (Unaudited) | ||
| FOR THE SIX MONTHS ENDED JUNE 30, | ||
| 2015 | 2014 | |
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||
| Net loss | $ (388) | $ (515) |
| Adjustments to reconcile net loss to net cash provided by operations: | ||
| Depreciation and amortization | 1,553 | 1,367 |
| Provision for doubtful accounts | 40 | -- |
| Share-based compensation | 98 | 81 |
| Gain on settlement of note payable and litigation | -- | (1,034) |
| Loss on debt refinancing | -- | 1,402 |
| Other | 26 | 54 |
| Changes in operating assets and liabilities: | ||
| Restricted cash | -- | 250 |
| Accounts receivable | 96 | 474 |
| Inventory | (143) | (183) |
| Prepaid expenses and other assets | (922) | (15) |
| Accounts payable | 572 | (264) |
| Accrued expenses and other long-term obligations | (196) | (10) |
| Deferred revenue | 126 | (860) |
| Net cash provided by operating activities | 862 | 747 |
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||
| Purchases of property and equipment | (989) | (290) |
| Disposals of property and equipment | 18 | |
| Collection/(Issuance) of note receivable | -- | 9 |
| Net cash used in investing activities | (971) | (281) |
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||
| Proceeds from notes payable | 2,500 | 15,000 |
| Payments on notes payable | (2,875) | (16,436) |
| Payments on amendment of senior notes payable | (75) | (704) |
| Debt financing fees | -- | (565) |
| Payments on capital leases | (97) | (67) |
| Insurance proceeds for settlement of notes payable dispute, net of expenses | -- | 373 |
| Net proceeds from exercise of stock options | 585 | 21 |
| Net cash provided by (used in) financing activities | 38 | (2,378) |
| Effect of foreign exchange rates | (36) | (21) |
| Net decrease in cash and cash equivalents | (107) | (1,933) |
| Cash and cash equivalents at beginning of period | 320 | 3,938 |
| Cash and cash equivalents at end of period | $ 213 | $ 2,005 |
| SUPPLEMENTAL INFORMATION: | ||
| Cash paid for: | ||
| Interest | $ 586 | $ 697 |
| Non-cash Investing and Financing Activities: | ||
| Note receivable from customer | 601 | -- |
*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.
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 | June 30, 2015 | June 30, 2014 |
| Net Income | 95 | 15 |
| Interest and amortization of OID | 287 | 268 |
| Tax | 42 | 35 |
| Depreciation | 158 | 109 |
| Amortization | 610 | 572 |
| Stock Compensation | 12 | 42 |
| EBITDA | 1,253 | 1,041 |
| One-time items | 132 | 138 |
| EBITDA excluding one-time items | 1,385 | 1,179 |
FOR THE SIX MONTHS ENDED
| $000s | June 30, 2015 | June 30, 2014 |
| Net Loss | (388) | (515) |
| Interest and amortization of OID | 577 | 775 |
| Tax | 102 | 77 |
| Depreciation | 332 | 222 |
| Amortization | 1,221 | 1,145 |
| Stock Compensation | 98 | 81 |
| EBITDA | 1,942 | 1,785 |
| One-time items | 415 | 534 |
| EBITDA excluding one-time items | 2,357 | 2,319 |
| Reconciliation of GAAP Net Earnings to Net Earnings Excluding One-time items | ||
| $000s | FOR THE THREE MONTHS ENDED June 30 | |
| 2015 | 2014 | |
| Net Income | 95 | 15 |
| Legal & Professional Services | 10 | 52 |
| Severance, Recruitment & Relocation | -- | 73 |
| Other one-time items (net) | 122 | 13 |
| Sub-total excluding Taxes | 132 | 138 |
| Sub-total one-time items | 132 | 138 |
| Net Income excluding one-time items | 227 | 153 |
| $000s | FOR THE SIX MONTHS ENDED June 30 | |
| 2015 | 2014 | |
| Net Loss | (388) | (515) |
| Loss on Debt Refinancing | -- | 1,402 |
| Gain on Settlement of Note Payable and litigation | -- | (1,034) |
| Legal & Professional Services | 18 | 80 |
| Severance, Recruitment & Relocation | 55 | 73 |
| Other one-time items (net) | 342 | 13 |
| Sub-total excluding Taxes | 415 | 534 |
| Sub-total one-time items | 415 | 534 |
| Net Income excluding one-time items | 27 | 19 |
CONTACT: For more information contact:
Brad Wolfe, CFO
Asure Software, Inc.
888-323-8835
bwolfe@asuresoftware.com