Quarterly revenue tops $9 million with addition of TCS Technologies
Milwaukee, Wis., December 11, 2014 – ARI Network Services, Inc. (NASDAQ: ARIS), an award-winning provider of data-driven software tools and marketing services that help dealers, distributors and manufacturers Sell More Stuff!™, reported financial results today for its fiscal 2015 first quarter ended October 31, 2014.
Highlights for the fiscal first quarter included:
- The company completed its acquisition of Tire Company Solutions, LLC (“TCS Technologies”) on September 30, 2014, further consolidating its position as the leader in eCommerce-enabled websites and digital marketing services in the automotive tire and wheel industry.
- Total revenues for the first quarter of fiscal year 2015 were $9.1 million, which compares with $8.2 million for the same period last year and $8.5 million in 4Q14.
- Operating income was $0.3 million for the first quarter of fiscal 2015, compared with operating income of $0.2 million for the same period last year and $0.4 million in 4Q14.
- Net income was $104, 000 or $0.01 per diluted share for the first quarter of fiscal 2015, compared with net income of $25, 000 or $0.00 per share for the same period last year and $174, 000 or $0.01 per share in 4Q14.
- EBITDA, a non-GAAP measure, adjusted for non-cash charges, was $1.2 million or 13.2% of revenue in the first quarter of fiscal year 2015. This compares with EBITDA of $1.0 million or 11.8% of revenue in the same period last year and $1.4 million or 16.1% of revenue in 4Q14.
- Cash generated from operations was $1.6 million for the first quarter of fiscal 2015, compared with ($26, 000) for the same period last year and $1.3 million in 4Q14.
Fiscal Year 2015 First Quarter Financials
ARI experienced 11.7% revenue growth as it reported revenues of $9.1 million for the first quarter of fiscal year 2015 compared with $8.2 million for the same period last year. Recurring revenues for the first quarter of fiscal year 2015 were $8.2 million versus $7.7 million in the same period last year. Recurring revenue comprised 89.5% of total revenue for the first quarter versus 94.7% for the same period last year.
Gross margin for the first quarter of fiscal year 2015 was 80.8% versus 80.9% last year.
Operating income was $283, 000 for the first quarter of fiscal year 2015, compared with operating income of $167, 000 for the same period last year, a 69.5% increase. The increase in results from operations is attributed to cost efficiencies and reductions made in fiscal year 2014, partially offset by incremental costs in the quarter related to the acquisition of TCS Technologies.
The company reported net income of $104, 000 or $0.01 per diluted share for the quarter, compared with a net income of $25, 000 or $0.00 per share last year.
Roy W. Olivier, President and Chief Executive Officer of ARI, commented, “With our first quarter results, we are off to a great start for our fiscal year. We closed the TCS Technologies acquisition on September 30, 2014, and with the incremental revenue they contributed for the quarter, ARI revenue topped $9.0 million in quarterly revenue for the first time. In addition to the revenue growth, we were able to improve upon both our profit and EBITDA performance from the prior year.”
William Nurthen, Chief Financial Officer, commented, “Our profit and EBITDA performance in the quarter was strong given we experienced more than $200, 000 in charges related to the TCS Technologies acquisition in the quarter. In addition, we posted our largest quarterly cash flow from operations performance ever at $1.6 million. We are pacing well ahead of last year as this result represents more cash flow than we generated in the first three quarters of fiscal 2014.”
First Quarter Fiscal 2015 Conference Call
ARI will conduct a conference call on Thursday, December 11, 2014 at 4:30 pm ET to review the financial results for the fiscal quarter ended October 31, 2014. Interested parties can access the conference call by dialing 877.359.3639 or 408.427.3725 and referring to conference ID: 45024166. The conference call is also being webcast and is available via the Company’s investor relations website at investor.arinet.com. A replay of the webcast will be archived on the company’s website for 60 days.
EBITDA, a non-GAAP measure, is defined as earnings before interest, income taxes, depreciation and amortization. Management believes EBITDA, to be a meaningful indicator of our performance that provides useful information to investors regarding our financial condition and results of operations. While management considers EBITDA to be an important measure of comparative operating performance, it should be considered in addition to, but not as a substitute for, net income and other measures of financial performance reported in accordance with generally accepted accounting principles (GAAP). Not all companies calculate EBITDA in the same manner and the measure as presented may not be comparable to similarly titled measures presented by other companies. A reconciliation of net income to EBITDA can be found at the Company’s investor relations website for all periods presented.
ARI Network Services, Inc. (ARI) (NASDAQ: ARIS) offers an award-winning suite of data-driven software tools and marketing services to help dealers, equipment manufacturers and distributors in selected vertical markets Sell More Stuff!™ – online and in-store. Our innovative products are powered by a proprietary data repository of enriched original equipment and aftermarket electronic content spanning more than 17 million active part and accessory SKUs and 750, 000 equipment models. Business is complicated, but we believe our customers’ technology tools don’t have to be. We remove the complexity of selling and servicing new and used vehicle inventory, parts, garments and accessories (PG&A) for customers in the automotive tire and wheel aftermarket, powersports, outdoor power equipment, marine, home medical equipment, recreational vehicles and appliance industries. More than 23, 500 equipment dealers, 195 distributors and 3, 360 brands worldwide leverage our web and eCatalog platforms to Sell More Stuff!™ For more information on ARI, visit investor.arinet.com.
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Certain statements in this news release contain “forward‐looking statements” regarding future events and our future results that are subject to the safe harbors created under the Securities Act of 1933. All statements other than statements of historical facts are statements that could be deemed to be forward-looking statements. These statements are based on current expectations, estimates, forecasts, and projects about the markets in which we operate and the beliefs and assumptions of our management. Words such as “expects, ” “anticipates, ” “targets, ” “goals, ” “projects”, “intends, ” “plans, ” “believes, ” “seeks, ” “estimates, ” “endeavors, ” “strives, ” “may, ” or variations of such words, and similar expressions are intended to identify such forward-looking statements. Readers are cautioned that these forward‐looking statements are subject to a number of risks, uncertainties and assumptions that are difficult to predict, estimate or verify. Therefore, actual results may differ materially and adversely from those expressed in any forward-looking statements. Such risks and uncertainties include those factors described in Part 1A of the company’s most recent annual report on Form 10‐K, as such may be amended or supplemented by subsequent quarterly reports on Form 10-Q, or other reports filed with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward‐looking statements. The forward‐looking statements are made only as of the date hereof, and the company undertakes no obligation to publicly release the result of any revisions to these forward‐looking statements. For more information, please refer to the company’s filings with the Securities and Exchange Commission.
For media inquiries, contact:
Colleen Malloy, Director of Marketing, ARI, +1.414.973.4323, Colleen.Malloyl@arinet.com
Investor inquiries, contact:
Steven Hooser, Three Part Advisors, +1.214.872.2710, firstname.lastname@example.org