Amber Road Announces Third Quarter 2018 Financial Results

Amber Road, Inc. AMBR, a leading provider of global trade management (GTM) solutions, today announced its financial results for the third quarter ended September 30, 2018.

Jim Preuninger, Chief Executive Officer of Amber Road, stated, "Q3 was another good quarter for Amber Road, exceeding our guidance on both the top and bottom lines. I am especially pleased to report positive non-GAAP operating income and strong adjusted EBITDA. We also generated meaningful cash flow from operations bringing our year-to-date cash flow from operations to roughly $5 million. We have established Amber Road as a company that can deliver solid revenue growth, with improving profit and cash flow."

Third Quarter 2018 Financial Highlights

Revenue

• Total revenue was $22.2 million, an increase compared to $20.2 million for the comparable period of 2017.
• Subscription revenue was $15.9 million, an increase compared to $14.9 million for the comparable period of 2017.
• Professional services revenue was $6.3 million, an increase compared to $5.3 million for the comparable period of 2017.

Operating Income (Loss)

• GAAP operating loss was $(1.2) million, compared to $(1.8) million for the comparable period of 2017.
• Non-GAAP adjusted operating income (loss)⁽¹⁾ was $1.3 million, compared to $(11,862) for the comparable period of 2017.

Net Income (Loss)

• GAAP net loss was $(1.6) million, compared to $(2.2) million for the comparable period of 2017.
• GAAP basic and diluted net loss per share was $(0.06), compared to $(0.08) for the comparable period of 2017, based on 27.9 million and 27.5 million basic and diluted weighted average shares outstanding, respectively.
• Non-GAAP adjusted net income (loss)⁽¹⁾ was $0.8 million, compared to $(0.4) million for the comparable period of 2017.
• Non-GAAP adjusted net income (loss) per share was $0.03, compared to $(0.02) for the comparable period of 2017, based on 27.9 million and 27.5 million basic and diluted weighted average shares outstanding, respectively.

Adjusted EBITDA

• Adjusted EBITDA was $2.5 million, compared to $1.0 million for the comparable period of 2017.

Effect of Accounting Standards Codification (ASC) 606 versus ASC 605

The table below shows the effects of the adoption of ASC 606 versus ASC 605 on our consolidated financial statements for the three and nine months ended September 30, 2018 for the following items:

Balance Sheet and Cash Flow

• Cash and cash equivalents at September 30, 2018 were $10.1 million, compared to $9.4 million at December 31, 2017 and $8.3 million at September 30, 2017.
• Cash provided by operating activities was $4.9 million for the nine months September 30, 2018, compared to cash used in operating activities of $(2.8) million for the nine months September 30, 2017.

A reconciliation of GAAP operating loss and net loss to Non-GAAP adjusted operating loss and net loss, and of GAAP net loss to Adjusted EBITDA has been provided in the financial statement tables included in this press release. An explanation of these measures is also included below under the heading "Non-GAAP Financial Measures."

Business Outlook

Based on information available as of November 8, 2018, Amber Road is issuing guidance for the fourth quarter and full year 2018. Refer to the reconciliation of GAAP guidance to non-GAAP guidance tables at the end of this release for details on non-GAAP adjustments.

Given our adoption of ASC 606, we anticipate fourth quarter and full-year 2018 results to be in the following ranges:

Endnotes:

(1) For 2018, non-GAAP adjusted operating loss and adjusted net loss excludes stock-based compensation. For 2017, non-GAAP adjusted operating loss and adjusted net loss excludes stock-based compensation and change in fair value of contingent consideration liability.

Conference Call Information

Amber Road will host a conference call on Thursday, November 8, 2018 at 5:00 p.m. Eastern Time (ET) to discuss the Company's third quarter financial results and its business outlook. To access this call, dial (888)-394-8218 (domestic) or (323)-794-2588 (international). The conference ID is 4359810. Additionally, a live webcast of the conference call will be available in the "Investor Relations" section of the Company's web site at www.AmberRoad.com.

Following the conference call, a replay will be available until November 15, 2018 at (844)-512-2921 (domestic) or (412)-317-6671 (international). The replay pass code is 4359810. An archived webcast of this conference call will also be available in the "Investor Relations" section of the Company's web site at www.AmberRoad.com.

About Amber Road

Amber Road's AMBR mission is to dramatically transform the way companies conduct global trade. As a leading provider of cloud-based global trade management (GTM) software, trade content and training, we help companies all over the world create value through their global supply chain by improving margins, achieving greater agility and lowering risk. We do this by creating a digital model of the global supply chain that enables collaboration between buyers, sellers and logistics companies. We replace manual and outdated processes with comprehensive automation for global trade activities, including sourcing, supplier management, production tracking, transportation management, supply chain visibility, import and export compliance, and duty management. We provide rich data analytics to uncover areas for optimization and deliver a platform that is responsive and flexible to adapt to the ever-changing nature of global trade.

Non-GAAP Financial Measures

To provide investors with additional information regarding our financial results, Amber Road has provided non-GAAP financial measures and non-GAAP guidance within this press release including non-GAAP adjusted operating and net income (loss) and adjusted EBITDA, financial measures that are not calculated in accordance with generally accepted accounting principles, or GAAP. Provided below is a reconciliation of GAAP operating and net loss to non-GAAP adjusted operating and net income (loss), and net loss to adjusted EBITDA. EBITDA consists of net loss plus depreciation and amortization, interest expense (income) and income tax expense. Adjusted EBITDA consists of EBITDA plus stock-based compensation and changes in the fair value of contingent consideration liability. Amber Road has included these non-GAAP measures in this press release because it assists in comparing performance on a consistent basis across reporting periods, as it removes from operating results the impact of the Company's capital structure. Amber Road believes these non-GAAP measures are useful to an investor in evaluating its operating performance because they are often used by the financial community to measure a company's operating performance without regard to items such as depreciation and amortization, which can vary depending upon accounting methods and the book value of assets, and to present a meaningful measure of performance exclusive of its capital structure and the method by which assets were acquired.

Amber Road's use of these non-GAAP measures has limitations as an analytical tool, and you should not consider it in isolation or as a substitute for analysis of its results as reported under GAAP. Some of these limitations are:

• although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future, and these non-GAAP measures do not reflect cash capital expenditure requirements for such replacements or for new capital expenditure requirements;
• these non-GAAP measures do not reflect changes in, or cash requirements for, working capital needs;
• these non-GAAP measures do not reflect the potentially dilutive impact of equity-based compensation;
• these non-GAAP measures do not reflect interest or tax payments that may represent a reduction in cash available; and
• other companies, including companies in Amber Road's industry, may calculate adjusted EBITDA differently, which reduces its usefulness as a comparative measure.

Because of these and other limitations, you should consider these non-GAAP measures together with other GAAP-based financial performance measures, including various cash flow metrics, net loss and other GAAP results. A reconciliation of GAAP operating and net loss to non-GAAP adjusted operating and net loss, and adjusted EBITDA has been provided in the financial statement tables included in this press release.

Cautionary Language Concerning Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not historical facts, but instead represent only our current expectations and beliefs, and therefore, contain risks and uncertainties about future events or our future financial performance, including, but not limited to, achieving revenue from bookings, closing business from the sales pipeline, new customer deployments and maintaining these relationships, the ability to reduce operating losses and use of cash, and attaining profitability. In some cases, you can identify forward-looking statements by terminology such as "may," "will," "could," "should," "expect," "intend," "plan," "anticipate," "believe," "estimate," "predict," "potential," or "continue," and similar expressions, whether in the negative or affirmative. These statements are only predictions and may be inaccurate. Actual events or results may differ materially. In evaluating these statements, you should specifically consider various factors, including the risks outlined in our filings with the Securities and Exchange Commission (SEC), including, without limitation, our annual, periodic and current SEC reports. These factors may cause our actual results to differ materially from any forward-looking statement. Although we believe that the expectations reflected in the forward-looking statements are reasonable, our future results, levels of activity, performance or achievements may differ from our expectations. Other than as required by law, we do not undertake to update any of the forward-looking statements after the date of this press release, even though our situation may change in the future.

Based on information available as of November 8, 2018, the following tables show 2018 GAAP guidance reconciled to non-GAAP guidance for the fourth quarter and full year 2018 as indicated below (numbers in millions, except per share data):

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