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): November 14, 2016
ASURE SOFTWARE, INC.
(Exact name of registrant as specified in charter)
|
Delaware
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0-20008
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74-2415696
|
|
(State or other jurisdiction of incorporation or organization)
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(Commission File No.)
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(IRS Employer Identification No.)
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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:
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☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Item 2.02. Results of Operations and Financial Condition.
On November 14, 2016, Asure Software, Inc. (the "Company") issued a press release announcing its financial results for its third quarter ended September 30, 2016. 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
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EXHIBIT NUMBER
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DESCRIPTION
|
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99.1
|
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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: November 14, 2016 By /s/ Brad Wolfe
Brad Wolfe, Chief Financial Officer
Exhibit 99.1
Asure Software Reports Strong Third Quarter 2016 Financial Results
Company Reaffirms Guidance for Full Year
AUSTIN, TX – November 14, 2016 – Asure Software, Inc. (NASDAQ: ASUR), a leading provider of Human Capital Management (HCM) and workplace management software, reported results for the third quarter ended September 30, 2016. The company also reported pro forma unaudited results, which included results from the acquisition of Mangrove Software as if it was completed on January 1, 2015.
|
Third Quarter 2016 Financial Summary
|
Actual Results
|
Pro Forma Results
|
||||||||||||||||||||||
|
(in millions except per share data and percentages)
|
Q3 2016 | Q3 2015 |
Change (%)
|
Q3 2016 | Q3 2015 |
Change (%)
|
||||||||||||||||||
|
Revenue
|
$
|
9.4
|
$
|
6.7
|
42
|
%
|
$
|
9.4
|
$
|
8.9
|
6
|
%
|
||||||||||||
|
Gross Margin
|
$
|
7.4
|
$
|
4.9
|
51
|
%
|
$
|
7.4
|
$
|
6.8
|
8
|
%
|
||||||||||||
|
Gross Margin (as a % of revenue)
|
78.5
|
%
|
73.7
|
%
|
7
|
%
|
78.5
|
%
|
76.6
|
%
|
3
|
%
|
||||||||||||
|
EBITDA (excluding one-time expenses)
|
$
|
2.3
|
$
|
0.8
|
199
|
%
|
$
|
2.3
|
$
|
1.3
|
77
|
%
|
||||||||||||
|
Net Income (Loss)
|
$
|
0.3
|
$
|
(0.6
|
)
|
155
|
%
|
$
|
0.3
|
$
|
(0.7
|
)
|
147
|
%
|
||||||||||
|
Net Income (Loss) per Diluted Share, Excluding one-time expenses
|
$
|
0.10
|
$
|
(0.09
|
)
|
211
|
%
|
$
|
0.10
|
$
|
(0.10
|
)
|
200
|
%
|
||||||||||
|
Year to Date 2016 Financial Summary
|
Actual Results
|
Pro Forma Results
|
||||||||||||||||||||||
|
(in millions except per share data and percentages)
|
YTD 2016
|
YTD 2015
|
Change (%)
|
YTD 2016
|
YTD 2015
|
Change (%)
|
||||||||||||||||||
|
Revenue
|
$
|
25.8
|
$
|
20.1
|
28
|
%
|
$
|
28.0
|
$
|
26.3
|
6
|
%
|
||||||||||||
|
Gross Margin
|
$
|
19.9
|
$
|
14.9
|
34
|
%
|
$
|
21.6
|
$
|
19.9
|
8
|
%
|
||||||||||||
|
Gross Margin (as a % of revenue)
|
77.0
|
%
|
73.8
|
%
|
4
|
%
|
77.1
|
%
|
75.7
|
%
|
2
|
%
|
||||||||||||
|
EBITDA (excluding one-time expenses)
|
$
|
5.3
|
$
|
3.1
|
70
|
%
|
$
|
5.8
|
$
|
4.1
|
43
|
%
|
||||||||||||
|
Net Income (Loss)
|
$
|
(1.1
|
)
|
$
|
(1.0
|
)
|
-15
|
%
|
$
|
(0.3
|
)
|
$
|
(1.9
|
)
|
85
|
%
|
||||||||
|
Net Income (Loss) per Diluted Share, Excluding one-time expenses
|
$
|
0.15
|
$
|
(0.09
|
)
|
267
|
%
|
$
|
0.17
|
$
|
(0.23
|
)
|
174
|
%
|
||||||||||
Third Quarter 2016 Operational Highlights
|
·
|
Secured a new three-year deal with one of the company’s largest customers, Packers Sanitation Services (PSSI).
|
|
·
|
Total bookings for the quarter were up 19% year-over-year and up 39% year-to-date.
|
|
·
|
Backlog totaled $3.9 million, a 49% increase compared to the prior quarter and a 22% increase from the year-ago quarter. The company continues to expect many enterprise clients to move through the implementation process throughout the rest of fiscal 2016 and 2017, which will result in conversion from backlog to reported revenue growth.
|
|
·
|
Secured several new wins across a range of industry verticals with leading enterprises, including Procter & Gamble, Merck, ExxonMobil, and Apple.
|
|
·
|
Launched Version 8 of core HCM software, which the company expects to start selling and installing in the fourth quarter.
|
|
·
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Cross-sell opportunities grew 452% from the second quarter, reflecting the increasing amount of synergies realized by the company since its acquisition of Mangrove Software in March 2016.
|
|
·
|
Overall pipeline of deals increased 212% from the second quarter, as the company continues to integrate its sales team to sell its entire suite of time and labor, workforce, and HCM solutions.
|
Third Quarter 2016 Financial Results
|
·
|
Revenue for the quarter increased 42% to $9.4 million from $6.7 million in the same year-ago quarter. On a pro forma basis, including the results from Mangrove Software as if the acquisition was completed on January 1, 2015, revenue increased 6% to $9.4 million from $8.9 million in the same year-ago quarter.
|
|
·
|
Recurring revenue for the quarter as a percent of total revenue was 74%, as compared to 75% in the third quarter of 2015.
|
|
·
|
Cloud revenue increased 65%, on premise software revenue increased 213%, and professional services revenue increased 78% from the third quarter of 2015.
|
|
·
|
Gross margin for the quarter was $7.4 million (78.5% of total revenue), a 51% increase from $4.9 million (73.7% of total revenue) in the third quarter of 2015.
|
|
·
|
EBITDA (Earnings before Interest, Taxes, Depreciation and Amortization)* excluding one-time items* for the quarter totaled $2.3 million, an increase of 199% compared to $767,000 in the third quarter of 2015.
|
|
·
|
Net income per share (excluding one-times*) for the third quarter totaled $0.10, compared to net loss per share (excluding one-times*) of $(0.09) in the third quarter of 2015. On a pro forma basis, including the results from Mangrove Software as if the acquisition was completed on January 1, 2015, net income per share (excluding one-times*) totaled $0.10, an improvement from a net loss per share (excluding one-times*) of $(0.10) in the same year-ago quarter.
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Financial Outlook
On a pro forma basis, including the company’s acquisition of Mangrove on March 21, 2016 and under the condition that Mangrove and Asure had been combined as a single company on January 1, 2016, Asure management reaffirmed its previously raised guidance for fiscal 2016 ending December 31:
|
2016 Financial Guidance
|
Fiscal 2016 (vs. Fiscal 2015)
|
|
Revenue
|
$37.75 million to $38.75 million (+40.3% to +44.0% vs. YTD 2015 actual)
|
|
EBITDA, excluding one-time items
|
$7.75 million to $8.25 million (+107.6% to +120.9% vs. YTD 2015 actual)
|
|
Net income per share, excluding one-time items
|
$0.22 to $0.30 (vs. a loss of $0.17 YTD 2015 actual)
|
Management Commentary
“After an important quarter defined by wide-scale integration, cost reductions, and efficiency realizations, Q3 represented the beginning of a ‘new normal’ for Asure—a period where our unified platform and expanded market focus led us to realize many of the benefits we expected in this new stage of growth,” said company CEO, Pat Goepel. “Not only did we continue to see a year-over-year increase in many of our key metrics, such as pro forma revenue, gross margin, and EBITDA, but we also produced another quarter of profitability, demonstrating the strong demand for both our established and new solutions, as well as the continued near-term realization of some of the synergies from the Mangrove acquisition.
“While our cloud bookings were down for the quarter, due to a large win we experienced in Q3 of last year, total bookings were up 19% year-over-year and 39% year-to-date, and are expected to continue increasing as more customers begin to purchase the newest versions of our products, which we recently released. In addition, we realized significant growth in our cloud revenue, professional services revenue, and on premise revenue—which, when combined with how we’ve streamlined our backlog conversion process over the first half of 2016, speaks to how we’re able to quickly and sustainably scale our revenue base. In fact, we experienced a strong conversion of enterprise clients from backlog to revenue during Q3, despite seeing a healthy increase in our overall backlog, which was primarily due to securing a new three-year deal with PSSI, one of our largest clients to-date.”
Brad Wolfe, CFO of Asure Software, added: “The increase in backlog and the addition of new products and cross-sell opportunities has set up the company for a strong 2017. In addition, the investment in infrastructure and process is increasing both the leverage and scalability of our business, which enables us to achieve higher throughput and lower operational costs. This, in turn, allows us ramp up our investment in our sales and marketing initiatives and product portfolio, which we believe will accelerate our expansion and growth goals.”
Goepel continued: “In summary, Q3 was another strong and encouraging quarter for us. From an operational standpoint, we experienced a considerable amount of progress from where we were just a quarter ago, having built the foundation for a stronger level of growth in the months and quarters ahead. Given this progress and the fact that our sales pipeline is shaping up to be promising in the near future, we believe we can achieve our financial guidance for 2016, which we raised in Q2.”
Conference Call Details
Asure management will host a conference call today at 11:00 a.m. Eastern time (10:00 a.m. Central time) to discuss these financial results and outlook. Asure CEO Pat Goepel and CFO Brad Wolfe will host the presentation, followed by a question and answer period.
Date: Monday, November 14, 2016
Time: 11:00 a.m. Eastern time (10:00 a.m. Central time)
U.S. dial-in: 877-853-5636
International dial-in: 631-291-4544
Conference ID: 2876476
Please call the conference telephone number ten 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 Group at 949-574-3860.
The conference call will be broadcasted live and available for replay via the investor section of the company's website.
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 7,000 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.
"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.
Company Contact:
Brad Wolfe, CFO
Asure Software, Inc.
888-323-8835
bwolfe@asuresoftware.com
Investor Relations Contact:
Matt Glover and Najim Mostamand
Liolios Group, Inc.
949-574-3860
ASUR@liolios.com
ASURE SOFTWARE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands)
|
|
September 30,
2016
(Unaudited)
|
December 31,
2015
|
||||||
|
Assets
|
||||||||
|
Current assets:
|
||||||||
|
Cash and cash equivalents
|
$
|
289
|
$
|
1,158
|
||||
|
Accounts and note receivable, net of allowance for doubtful accounts of $136 and $145
at September 30, 2016 and December 31, 2015, respectively
|
6,599
|
4,671
|
||||||
|
Inventory
|
616
|
784
|
||||||
|
Prepaid expenses and other current assets
|
1,441
|
1,072
|
||||||
|
Total current assets before funds held for clients
|
8,945
|
7,685
|
||||||
|
Funds held for clients
|
12,264
|
-
|
||||||
|
Total current assets
|
21,209
|
7,685
|
||||||
|
Property and equipment, net
|
1,764
|
2,212
|
||||||
|
Goodwill
|
26,263
|
17,436
|
||||||
|
Intangible assets, net
|
12,779
|
6,026
|
||||||
|
Other assets
|
42
|
458
|
||||||
|
Total assets
|
$
|
62,057
|
$
|
33,817
|
||||
|
Liabilities and stockholders’ equity
|
||||||||
|
Current liabilities:
|
||||||||
|
Current portion of notes payable, net of debt issuance cost
|
$
|
5,099
|
$
|
909
|
||||
|
Accounts payable
|
2,542
|
2,670
|
||||||
|
Accrued compensation and benefits
|
1,180
|
715
|
||||||
|
Other accrued liabilities
|
1,960
|
1,181
|
||||||
|
Deferred revenue
|
8,905
|
10,803
|
||||||
|
Total current liabilities before client fund obligations
|
19,686
|
16,278
|
||||||
|
Client fund obligations
|
12,264
|
-
|
||||||
|
Total current liabilities
|
31,950
|
16,278
|
||||||
|
Long-term liabilities:
|
||||||||
|
Deferred revenue
|
844
|
947
|
||||||
|
Notes payable, net of debt issuance cost
|
25,464
|
12,384
|
||||||
|
Other liabilities
|
315
|
490
|
||||||
|
Total long-term liabilities
|
26,623
|
13,821
|
||||||
|
Total liabilities
|
58,573
|
30,099
|
||||||
|
Stockholders’ equity:
|
||||||||
|
Preferred stock, $.01 par value; 1,500 shares authorized; none issued or outstanding
|
-
|
-
|
||||||
|
Common stock, $.01 par value; 11,000 shares authorized; 6,916 and 6,674 shares issued,
6,532 and 6,290 shares outstanding at September 30, 2016 and December 31, 2015, respectively
|
69
|
67
|
||||||
|
Treasury stock at cost, 384 shares at September 30, 2016 and December 31, 2015
|
(5,017
|
)
|
(5,017
|
)
|
||||
|
Additional paid-in capital
|
280,374
|
279,649
|
||||||
|
Accumulated deficit
|
(272,006
|
)
|
(270,903
|
)
|
||||
|
Accumulated other comprehensive income (loss)
|
64
|
(78
|
)
|
|||||
|
Total stockholders’ equity
|
3,484
|
3,718
|
||||||
|
Total liabilities and stockholders’ equity
|
$
|
62,057
|
$
|
33,817
|
||||
ASURE SOFTWARE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(Amounts in thousands, except share and per share data)
(Unaudited)
|
|
FOR THE
THREE MONTHS ENDED
SEPTEMBER 30,
|
FOR THE
NINE MONTHS ENDED
SEPTEMBER 30,
|
||||||||||||||
|
|
2016
|
2015
|
2016
|
2015
|
||||||||||||
|
Revenues:
|
||||||||||||||||
|
Cloud revenue
|
$
|
5,630
|
$
|
3,413
|
$
|
14,881
|
$
|
10,201
|
||||||||
|
Hardware revenue
|
676
|
835
|
2,644
|
2,467
|
||||||||||||
|
Maintenance and support revenue
|
1,078
|
1,434
|
3,509
|
4,541
|
||||||||||||
|
On premise software license revenue
|
754
|
241
|
1,352
|
728
|
||||||||||||
|
Professional services revenue
|
1,302
|
731
|
3,440
|
2,208
|
||||||||||||
|
Total revenues
|
9,440
|
6,654
|
25,826
|
20,145
|
||||||||||||
|
Cost of sales
|
2,026
|
1,750
|
5,932
|
5,281
|
||||||||||||
|
Gross margin
|
7,414
|
4,904
|
19,894
|
14,864
|
||||||||||||
|
|
||||||||||||||||
|
Operating expenses
|
||||||||||||||||
|
Selling, general and administrative
|
5,046
|
3,866
|
14,853
|
10,926
|
||||||||||||
|
Research and development
|
761
|
786
|
2,217
|
2,267
|
||||||||||||
|
Amortization of intangible assets
|
625
|
505
|
1,628
|
1,514
|
||||||||||||
|
Total operating expenses
|
6,432
|
5,157
|
18,698
|
14,707
|
||||||||||||
|
|
||||||||||||||||
|
Income (loss) from operations
|
982
|
(253
|
)
|
1,196
|
157
|
|||||||||||
|
|
||||||||||||||||
|
Other income (loss)
|
||||||||||||||||
|
Interest income
|
-
|
-
|
10
|
-
|
||||||||||||
|
Loss on lease termination
|
-
|
-
|
-
|
(110
|
)
|
|||||||||||
|
Foreign currency gain (loss)
|
(11
|
)
|
(5
|
)
|
(9
|
)
|
(13
|
)
|
||||||||
|
Loss on debt refinancing
|
-
|
(4
|
)
|
-
|
(4
|
)
|
||||||||||
|
Interest expense and other
|
(609
|
)
|
(266
|
)
|
(1,461
|
)
|
(828
|
)
|
||||||||
|
Interest expense- amortization of original issue discount (OID)
|
-
|
(3
|
)
|
-
|
(19
|
)
|
||||||||||
|
Acquisition costs
|
-
|
-
|
(706
|
)
|
-
|
|||||||||||
|
Total other loss, net
|
(620
|
)
|
(278
|
)
|
(2,166
|
)
|
(974
|
)
|
||||||||
|
|
||||||||||||||||
|
Income (loss) from operations before income taxes
|
362
|
(531
|
)
|
(970
|
)
|
(817
|
)
|
|||||||||
|
Income tax provision
|
(47
|
)
|
(43
|
)
|
(133
|
)
|
(145
|
)
|
||||||||
|
Net income (loss)
|
$
|
315
|
$
|
(574
|
)
|
$
|
(1,103
|
)
|
$
|
(962
|
)
|
|||||
|
Other comprehensive income (loss)
|
||||||||||||||||
|
Foreign currency gain (loss)
|
26
|
27
|
142
|
(8
|
)
|
|||||||||||
|
Other comprehensive income (loss)
|
$
|
341
|
(547
|
)
|
$
|
(961
|
)
|
$
|
(970
|
)
|
||||||
|
|
||||||||||||||||
|
Basic and diluted net income (loss) per share
|
||||||||||||||||
|
Basic
|
$
|
0.05
|
$
|
(0.09
|
)
|
$
|
(0.17
|
)
|
$
|
(0.16
|
)
|
|||||
|
Diluted
|
$
|
0.05
|
$
|
(0.09
|
)
|
$
|
(0.17
|
)
|
$
|
(0.16
|
)
|
|||||
|
Weighted average basic and diluted shares
|
||||||||||||||||
|
Basic
|
6,534,000
|
6,290,000
|
6,383,000
|
6,138,000
|
||||||||||||
|
Diluted
|
6,548,000
|
6,290,000
|
6,383,000
|
6,138,000
|
||||||||||||
ASURE SOFTWARE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in thousands)
(Unaudited)
|
|
FOR THE
NINE MONTHS ENDED
SEPTEMBER 30,
|
|||||||
|
|
2016
|
2015
|
||||||
|
CASH FLOWS FROM OPERATING ACTIVITIES:
|
||||||||
|
Net loss
|
$
|
(1,103
|
)
|
$
|
(962
|
)
|
||
|
Adjustments to reconcile net loss to net cash (used in) provided by operations:
|
||||||||
|
Depreciation and amortization
|
2,686
|
2,324
|
||||||
|
Provision for doubtful accounts
|
50
|
70
|
||||||
|
Share-based compensation
|
166
|
335
|
||||||
|
Loss on debt financing
|
-
|
4
|
||||||
|
Other
|
94
|
28
|
||||||
|
Changes in operating assets and liabilities:
|
||||||||
|
Accounts receivable
|
(1,678
|
)
|
977
|
|||||
|
Inventory
|
169
|
(530
|
)
|
|||||
|
Prepaid expenses and other assets
|
124
|
(927
|
)
|
|||||
|
Accounts payable
|
(189
|
)
|
542
|
|||||
|
Accrued expenses and other long-term obligations
|
951
|
354
|
||||||
|
Deferred revenue
|
(2,000
|
)
|
(222
|
)
|
||||
|
Net cash (used in) provided by operating activities
|
(730
|
)
|
1,993
|
|||||
|
|
||||||||
|
CASH FLOWS FROM INVESTING ACTIVITIES:
|
||||||||
|
Acquisitions net of cash acquired
|
(12,000
|
)
|
-
|
|||||
|
Purchases of property and equipment
|
(128
|
)
|
(1,290
|
)
|
||||
|
Disposals of property and equipment
|
-
|
18
|
||||||
|
Collection of note receivable
|
223
|
-
|
||||||
|
Net change in funds held for clients
|
4,155
|
-
|
||||||
|
Net cash used in investing activities
|
(7,750
|
)
|
(1 272
|
)
|
||||
|
|
||||||||
|
CASH FLOWS FROM FINANCING ACTIVITIES:
|
||||||||
|
Proceeds from notes payable
|
16,823
|
4,250
|
||||||
|
Payments on notes payable
|
(5,173
|
)
|
(5,527
|
)
|
||||
|
Payments on amendment of senior notes payable
|
-
|
(75
|
)
|
|||||
|
Debt financing fees
|
(438
|
)
|
-
|
|||||
|
Payments on capital leases
|
(158
|
)
|
(147
|
)
|
||||
|
Net proceeds from exercise of stock options
|
561
|
585
|
||||||
|
Net change in client fund obligations
|
(4,155
|
)
|
-
|
|||||
|
Net cash provided by (used in) financing activities
|
7,460
|
(914
|
)
|
|||||
|
|
||||||||
|
Effect of foreign exchange rates
|
151
|
(5
|
)
|
|||||
|
|
||||||||
|
Net decrease in cash and cash equivalents
|
(869
|
)
|
(198
|
)
|
||||
|
Cash and cash equivalents at beginning of period
|
1,158
|
320
|
||||||
|
Cash and cash equivalents at end of period
|
$
|
289
|
$
|
122
|
||||
|
|
||||||||
|
SUPPLEMENTAL INFORMATION:
|
||||||||
|
Cash paid for:
|
||||||||
|
Interest
|
$
|
817
|
$
|
597
|
||||
|
|
||||||||
|
Non-cash Investing and Financing Activities:
|
||||||||
|
Note receivable from customer
|
-
|
601
|
||||||
|
Subordinated notes payable – Mangrove acquisition
|
6,000
|
-
|
||||||
|
Accrued purchases of property and equipment
|
-
|
17
|
||||||
*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
|
September 30,
2016
|
September 30,
2015
|
||||||
|
Net Income (loss)
|
$
|
315
|
$
|
(574
|
)
|
|||
|
Interest and amortization of OID
|
529
|
269
|
||||||
|
Tax
|
47
|
43
|
||||||
|
Depreciation
|
249
|
160
|
||||||
|
Amortization
|
731
|
611
|
||||||
|
Stock Compensation
|
60
|
237
|
||||||
|
EBITDA
|
1,931
|
746
|
||||||
|
One-time items
|
365
|
21
|
||||||
|
EBITDA excluding one-time items
|
$
|
2,296
|
$
|
767
|
||||
FOR THE NINE MONTHS ENDED
|
$000s
|
September 30,
2016
|
September 30,
2015
|
||||||
|
Net Loss
|
$
|
(1,103
|
)
|
$
|
(962
|
)
|
||
|
Interest and amortization of OID
|
1,376
|
847
|
||||||
|
Tax
|
133
|
145
|
||||||
|
Depreciation
|
739
|
492
|
||||||
|
Amortization
|
1,947
|
1,832
|
||||||
|
Stock Compensation
|
166
|
335
|
||||||
|
EBITDA
|
3,258
|
2,689
|
||||||
|
One-time items
|
2,048
|
436
|
||||||
|
EBITDA excluding one-time items
|
$
|
5,306
|
$
|
3,125
|
||||
Reconciliation of GAAP Net Earnings to Net Earnings Excluding One-time items
FOR THE THREE MONTHS ENDED
|
$000
|
||||||||
|
September 30,
2016
|
September 30,
2015
|
|||||||
|
Net Loss
|
$
|
315
|
$
|
(574
|
)
|
|||
|
Legal & Professional Services
|
136
|
17
|
||||||
|
Severance, Recruitment & Relocation
|
88
|
-
|
||||||
|
Other one-time items (net)
|
141
|
4
|
||||||
|
Sub-total excluding Taxes
|
365
|
21
|
||||||
|
Sub-total one-time items
|
365
|
21
|
||||||
|
Net Income excluding one-time items
|
$
|
680
|
$
|
(553
|
)
|
|||
FOR THE NINE MONTHS ENDED
|
$000
|
||||||||
|
September 30,
2016
|
September 30,
2015
|
|||||||
|
Net Loss
|
$
|
(1,103
|
)
|
$
|
(962
|
)
|
||
|
Legal & Professional Services
|
982
|
35
|
||||||
|
Severance, Recruitment & Relocation
|
809
|
55
|
||||||
|
Other one-time items (net)
|
257
|
346
|
||||||
|
Sub-total excluding Taxes
|
2,048
|
436
|
||||||
|
Sub-total one-time items
|
2048
|
436
|
||||||
|
Net Income excluding one-time items
|
$
|
945
|
$
|
(526
|
)
|
|||