Liquidity Services Reports Q4 EPS $0.20 vs $0.19 Est; Revenues $80.7M vs $79M Est

Liquidity Services, Inc. (NASDAQ: LQDT) today reported its financial results for its fiscal year (FY-11) and fourth quarter (Q4-11) ended September 30, 2011. Liquidity Services, Inc. provides business and government clients and buying customers transparent, innovative and effective online marketplaces and integrated services for surplus assets.

Liquidity Services, Inc. reported record consolidated FY-11 revenue of $337.4 million, an increase of approximately 18% from the prior year. Adjusted EBITDA, which excludes stock-based compensation and acquisition costs and goodwill impairment, for FY-11 was a record $52.7 million, an increase of approximately 41% from the prior year. FY-11 GMV, the total sales volume of all merchandise sold through the Company's marketplaces, was a record $558.5 million, an increase of approximately 30% from the prior year.

These results include the losses from our U.K. operations, which have been shut down and are accounted for as discontinued operations in our statement of operations. For the amount of losses incurred from our U.K. operations, refer to our statement of operations within this press release.

The Company reported consolidated Q4-11 revenue of $80.7 million, an increase of approximately 11% from the prior year's comparable period. Adjusted EBITDA for Q4-11 was $12.5 million, an increase of approximately 51% from the prior year's comparable period. GMV was $146.0 million for Q4-11, an increase of approximately 20% from the prior year's comparable period. These results include our U.K. operations, as noted above.

Net income in FY-11 was $8.5 million or $0.29 diluted earnings per share. Adjusted net income in FY-11, which excludes stock-based compensation and acquisition costs and goodwill impairment, was a record $30.5 million, an increase of approximately 88% from the prior year, and was $1.05 adjusted diluted earnings per share. Net income in Q4-11 was $3.1 million or $0.10 diluted earnings per share. Adjusted net income in Q4-11 was $4.1 million, an increase of approximately 20% from the prior year's comparable period, and was $0.14 adjusted diluted earnings per share. During Q3-11, LSI had estimated the effective tax rate to be 26%, or a benefit of $0.26 per share, as a result of the closure of the U.K. operations.

Actual FY-11 adjusted net income and adjusted diluted earnings per share realized a tax benefit of $0.20 per share, based on an effective tax rate of 34%, which negatively impacted Q4-11 by $0.06 per share. Excluding this impact would have resulted in adjusted diluted earnings per share of $0.20 for Q4-11. We estimate that our future effective income tax rate will be approximately 42%.