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Speed Commerce Reports Fiscal Second Quarter 2016 Results

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DALLAS, Nov. 16, 2015 (GLOBE NEWSWIRE) -- Speed Commerce, Inc. (NASDAQ: SPDC), a leading provider of ecommerce technology and omni-channel solutions for retailers, reported financial results for its fiscal second quarter ended September 30, 2015.

Fiscal Q2 2016 Summary vs. Same Year-Ago Quarter

  • Net revenues increased 36% to $31.3 million
  • Adjusted gross profit margin was 17.1% compared to 23.9%
  • Adjusted EBITDA was $(0.6) million compared to $2.6 million
  • Net loss from continuing operations was $26.0 million or $(0.32) per diluted share versus a loss of $1.9 million or $(0.06) per diluted share

Fiscal Q2 2016 Financial Results from Continuing Operations

Net revenues in the fiscal second quarter of 2016 increased 36% to $31.3 million compared to $23.1 million in the year-ago quarter. The increase was due to the inclusion of Fifth Gear, which was acquired in the third quarter of fiscal 2015.

Adjusted gross profit margin was 17.1% compared to 23.9% in the year-ago quarter (see "Use of Non-GAAP Financial Information" below for further discussion about this and other non-GAAP measures). The decrease was due to higher operating costs in the company's Ohio fulfillment center.

Adjusted EBITDA (a non-GAAP measure) was $(0.6) million compared to $2.6 million in the year-ago quarter.

Net loss from continuing operations was $26.0 million or $(0.32) per diluted share, compared to a loss of $1.9 million or $(0.06) per diluted share in the year-ago quarter. This net loss includes the impact of a $17.3 million pre-tax non-cash charge related to the impairment of goodwill and intangibles recognized during the second quarter of fiscal year 2016.

About Speed Commerce

Speed Commerce, Inc. (NASDAQ: SPDC) is a single-source provider of ecommerce technology and services that help retailers and manufacturers acquire new customers by providing personalized, relevant experiences. Services include ecommerce platform development; hosting, managed ecommerce, and marketing services; order and inventory management; pick, pack, and ship; returns processing; and 24/7 customer care. For additional information, please visit the company's website at www.speedcommerce.com.

Use of Non-GAAP Information

In evaluating the company's financial performance and operating trends, management considers information concerning the company's adjusted gross margins, and adjusted EBITDA, among other items, which are not calculated in accordance with generally accepted accounting principles ("GAAP") in the United States of America. The company's management believes these non-GAAP measures are useful to investors because they provide supplemental information that facilitates comparisons to prior periods and for the evaluation of financial results. Management uses these non-GAAP measures to evaluate its financial results, develop budgets and manage expenditures. The method the company uses to produce non-GAAP results is not computed according to GAAP, is likely to differ from the methods used by other companies and should not be regarded as a replacement for corresponding GAAP measures. Investors are encouraged to review the reconciliation of these non-GAAP financial measures to the comparable GAAP results, which is attached to this release and can also be found on the company's website at www.speedcommerce.com.

Important Cautions Regarding Forward Looking Statements

The statements in this press release are "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995 and are intended to be covered by the safe harbors provided therein. These forward-looking statements are subject to risks and uncertainties, and the actual results that the company achieves, or reports in its Form 10-Q in connection with this period, may differ materially from these forward-looking statements due to such risks and uncertainties, including, but not limited to: the company's history of financial losses and the possibility that it will achieve profitability; the potential that the company will not meet NASDAQ continued listing standards and that it may be delisted; The company's need to meet covenants with respect to its credit facility that includes conditions that are outside of its control; difficult economic conditions that adversely affect the company or its clients; the company's revenues being derived from a small group of clients; pending or prospective litigation may subject the company to significant costs; the seasonal nature of the company's business; the company's ability to quickly and cost-effectively adapt to the changing demands of its clients; the potential for the company to incur significant costs and to experience operational and logistical difficulties in connection with its information technology systems and fulfillment infrastructure; the company's dependence on significant clients and vendors; the company's ability to meet significant working capital requirements; and the company's ability to compete effectively in the highly competitive markets that it serves. In addition to these, a detailed statement of risks and uncertainties is contained in the company's reports to the U.S. Securities and Exchange Commission (the "SEC"), including, in particular, the company's proxy materials, the company's Form 10-K filings, as well as its other SEC filings and public disclosures.

Investors and shareholders are urged to read this press release carefully. The company can offer no assurances that any projections, assumptions or forecasts made or discussed in this press release, will be met, and investors should understand the risks of investing solely due to such projections. The forward-looking statements included in this press release are made only as of the date of this report and the company undertakes no obligation to update these forward-looking statements to reflect subsequent events or circumstances.

Investors and shareholders may obtain free copies of the public filings through the website maintained by the SEC at www.sec.gov or at one of the SEC's other public reference rooms in Washington, D.C., New York, New York or Chicago, Illinois. Please contact the SEC at 1-800-SEC-0330 for further information with respect to the SEC's public reference rooms. 

SPEED COMMERCE, INC. 
Consolidated Condensed Balance Sheets 
(In thousands) 
     
 (Unaudited) (Audited) 
 September 30, March 31, 
  2015   2015  
Assets:    
Current assets:    
Cash $  2,011  $  6,381  
Accounts receivable, net   19,848     18,685  
Inventory   1,575     1,687  
Prepaid expenses   1,822     1,633  
Other current assets   8,234     7,199  
Total current assets   33,490     35,585  
Property and equipment, net    21,391     23,072  
Goodwill and intangible assets, net   67,685     87,357  
Other long-term assets   11,051     12,268  
Total assets$  133,617  $  158,282  
Liabilities and shareholders' equity:    
Current liabilities:    
Current portion of long-term debt$  107,341  $  2,750  
Accounts payable   9,291     16,453  
Accrued expenses   8,659     9,862  
Other current liabilities   10,926     10,718  
Total current liabilities   136,217     39,783  
Long-term liabilities:    
Long-term debt   -      96,000  
Other liabilities   12,109     16,863  
Total liabilities   148,326     152,646  
Shareholders' equity   (14,709)    5,636  
Total liabilities and shareholders' equity$  133,617  $  158,282  
     

 

SPEED COMMERCE, INC. 
Consolidated Statements of Operations and Comprehensive (Loss) 
(In thousands, except per share amounts) 
  
  (Unaudited) (Unaudited) 
  Three months ended September 30, Six months ended September 30, 
   2015   2014   2015   2014  
Net revenues $  31,331  $  23,067  $  65,702  $
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