ALLEN, Texas, Nov. 14, 2013 /PRNewswire/ --PFSweb, Inc.
(Nasdaq: PFSW), an international provider of end-to-end
eCommerce solutions, today announced its financial results for the
quarter ended September 30, 2013.
"During the third quarter, we continued to make progress toward
driving PFSweb to sustainable, profitable, long-term growth through
new and expanded client relationships and our continued focus on
driving operational efficiencies through the business," stated
Mike Willoughby, Chief Executive
Officer of PFSweb. "In September, we signed a contract to develop
and deploy an end-to-end solution for the United States Mint. The
contract win came on the heels of a number of successful program
launches during the period, including TJ Maxx and two L'Oreal
USA brands: Clarisonic and em
michelle phan. We believe our recent success in winning new
business and launching new programs demonstrates the quality of our
eCommerce solutions and the traction we enjoy in the marketplace.
Our current business pipeline remains strong at approximately
$45 million in average annual
contract value based on client projections, following the
transition of the United States Mint into implementation
status."
Mr. Willoughby continued, "Our financial results for the quarter
ended September 2013 were impacted by
previously announced client transitions, partially offset by growth
in new and existing clients, including project work, and the impact
of our ongoing cost control efforts. As previously mentioned, we
expect to see sequential improvement in the fourth quarter as we
realize further benefit from new and expanded client relationships
and also experience higher volumes during the holiday season. Based
on our projections, we are reiterating our 2013 Service Fee
Equivalent Revenue guidance of $110 million
to $115 million and our Adjusted EBITDA guidance of
$9 million to $10.5 million, and
currently expect to be toward the higher end of the range for both
targets."
Summary of consolidated results for the third quarter ended
September 30, 2013:
- Service Fee revenue decreased 15% to $23.9 million, compared to $28.3 million for the same period in 2012;
Service Fee Equivalent Revenue (as defined) decreased 17% to
$25.2 million, compared to
$30.2 million for the same period in
2012;
- Total revenue decreased 17% to $53.6
million, compared to $64.8
million for the third quarter of 2012;
- Adjusted EBITDA (as defined) decreased to $1.4 million, compared to $2.8 million for the same period in 2012;
- Net loss was $2.0 million, or
$0.12 per basic and diluted share,
compared to net loss of $0.4 million,
or $0.03 per basic and diluted share,
for the third quarter of 2012;
- Non-GAAP net loss (as defined) was $1.3
million, or $0.08 per basic
and diluted share, compared to non-GAAP net loss of 62,000, or less
than $0.01 per basic and diluted
share, for the quarter ended September 30,
2012.
Summary of consolidated results for the nine months ended
September 30, 2013:
- Service Fee revenue decreased 7% to $78.7 million, compared to $85.0 million for the same period in 2012;
Service Fee Equivalent Revenue (as defined) decreased 10% to
$83.2 million, compared to
$92.0 million for the same period in
2012;
- Total revenue decreased 15% to $174.9
million, compared to $204.6
million for the first nine months of 2012;
- Adjusted EBITDA (as defined) decreased to $6.8 million, compared to $8.2 for the same period in 2012;
- Net loss was $5.5 million, or
$0.38 per basic and diluted share,
compared to net loss of $2.2 million,
or $0.17 per basic and diluted share,
for the same period in 2012;
- Non-GAAP net loss (as defined) was $1.7
million, or $0.12 per basic
and diluted share, compared to non-GAAP net income of $0.2 million, or $0.01 per basic and diluted share, for the 2012
period.
Mr. Willoughby continued, "Looking toward 2014, we expect to
complete our recovery from the impact of the previously announced
client transitions as we benefit from our 2013 restructuring
activities and the onset of new client contracts, including the
United States Mint. At this time, we are targeting 2014
Service Fee Equivalent Revenue to be in the range of $127 million to $133 million and Adjusted EBITDA
to be in the range of $12 million to $14
million. With the anticipated launch of the United
States Mint contract in the third quarter of 2014, we expect the
new contract revenue to be substantially back-loaded during the
year."
Conference Call Information
Management will host a conference call at 11:00 am Eastern Time (10:00 am Central Time) on Thursday, November 14, 2013, to discuss the
latest corporate developments and results. To listen to the call,
please dial (888) 562-3356 and enter pin number 93467776 at least
five minutes before the scheduled start time. Investors can also
access the call in a "listen only" mode via the Internet at the
Company's website, www.pfsweb.com or www.kcsa.com. Please allow
extra time prior to the call to visit the site and download any
necessary audio software.
A digital replay of the conference call will be available
through December 14, 2013 at (855)
859-2056, pin number 93467776. The replay also will be available at
the Company's website for a limited time.
Non-GAAP Financial Measures
This news release may contain certain non-GAAP measures,
including non-GAAP net income (loss), Earnings Before Interest,
Income Taxes, Depreciation and Amortization ("EBITDA"), Adjusted
EBITDA and Service Fee Equivalent Revenue.
Non-GAAP net income (loss) represents net income (loss)
calculated in accordance with U.S. GAAP as adjusted for the impact
of non-cash stock-based compensation expense, restructuring and
other charges, lease termination costs and certain move related
expenses.
EBITDA represents earnings (or losses) before interest, income
taxes, depreciation, and amortization. Adjusted EBITDA
further eliminates the effect of stock-based compensation,
restructuring and other charges, lease termination costs and
certain move related expenses.
Service Fee Equivalent Revenue represents service fee revenue
plus the gross profit earned on product revenue.
Non-GAAP net income (loss), EBITDA, Adjusted EBITDA and Service
Fee Equivalent Revenue are used by management, analysts, investors
and other interested parties in evaluating our operating
performance compared to that of other companies in our
industry. The calculation of non-GAAP net income (loss)
eliminates the effect of stock-based compensation, restructuring
and other charges, lease termination costs and certain move related
expenses and EBITDA and Adjusted EBITDA further eliminate the
effect of financing, income taxes and the accounting effects of
capital spending, which items may vary from different companies for
reasons unrelated to overall operating performance. Service
Fee Equivalent Revenue allows client contracts with similar
operational support models but different financial models to be
combined as if all contracts were being operated on a service fee
revenue basis.
PFSweb believes these non-GAAP measures provide useful
information to both management and investors by excluding certain
expenses that may not be indicative of its core operating
results. These measures should be considered in addition to
results prepared in accordance with GAAP, but should not be
considered a substitute for, or superior to, GAAP results.
The non-GAAP measures included in this press release have been
reconciled to the GAAP results in the attached tables.
About PFSweb, Inc.
PFSweb is engaged by iconic brands to enable and manage
customized eCommerce and omni-channel commerce initiatives.
PFSweb's iCommerce Hub(SM) technology ecosystem offers retailers a
multi-channel order management system that allows partner/client
data integration and international payment processing. PFSweb's
iCommerce Professional Service(SM) provides interactive marketing
services, eCommerce web site development and support services, IT
development services, product content management, customer
intelligence and relationship and account management services.
PFSweb's iCommerce Centers of Excellence(SM) provides global
fulfillment and logistics, high-touch customer care and client
financial services.
Together, PFSweb's iCommerce Solutions allow for international
reach and expertise in both direct-to-consumer and
business-to-business initiatives. PFSweb supports organizations
across multiple industries including Procter & Gamble, L'Oreal,
LEGO, Columbia Sportswear, Sorel, Carter's, AAFES, Riverbed, Ricoh,
Hawker Beechcraft Corp, Roots Canada Ltd., Diageo, BCBGMAXAZRIA,
BCBGENERATION, HERVE LEGER BY MAX
AZRIA, The TJX Companies, Inc., T.J.
Maxx, and the United States Mint. PFSweb is headquartered in
Allen, TX with additional
locations in Tennessee,
Mississippi, Canada, Belgium, and the
Philippines.
To find out more about PFSweb (NASDAQ: PFSW), visit the
company's website at http://www.PFSweb.com.
The matters discussed herein consist of forward-looking
information under the Private Securities Litigation Reform Act of
1995 and is subject to and involves risks and uncertainties, which
could cause actual results to differ materially from the
forward-looking information. PFSweb's Annual Report on Form 10-K
for the year ended December 31, 2012
and Quarterly Report on Form 10-Q for the three and six months
ended June 30, 2013 identify certain
factors that could cause actual results to differ materially from
those projected in any forward looking statements made and
investors are advised to review the Annual and Quarterly Reports of
the Company and the Risk Factors described therein. PFSweb
undertakes no obligation to update publicly any forward-looking
statement for any reason, even if new information becomes available
or other events occur in the future. There may be additional risks
that we do not currently view as material or that are not presently
known.
Contact:
Mike
Willoughby Todd
Fromer / Garth Russell
Chief Executive
Officer
Investor Relations
or Thomas J.
Madden KCSA
Strategic Communications
Chief Financial
Officer
(212) 896-1215 / (212) 896-1250
(972)
881-2900 tfromer@kcsa.com
/ grussell@kcsa.com
PFSweb, Inc. and
Subsidiaries
|
Preliminary Unaudited
Condensed Consolidated Statements of Operations (A)
|
(In Thousands, Except
Per Share Data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
|
|
September
30,
|
|
September
30,
|
|
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
REVENUES:
|
|
|
|
|
|
|
|
|
|
|
Product
revenue, net
|
|
$
21,495
|
|
$
27,476
|
|
$
69,660
|
|
$
91,450
|
|
Service fee
revenue
|
|
23,908
|
|
28,260
|
|
78,708
|
|
85,022
|
|
Pass-thru
revenue
|
|
8,150
|
|
9,018
|
|
26,511
|
|
28,121
|
|
|
Total
revenues
|
53,553
|
|
64,754
|
|
174,879
|
|
204,593
|
|
|
|
|
|
|
|
|
|
|
|
COSTS OF
REVENUES:
|
|
|
|
|
|
|
|
|
|
Cost of product
revenue
|
20,221
|
|
25,538
|
|
65,215
|
|
84,483
|
|
Cost of service
fee revenue
|
16,196
|
|
20,777
|
|
53,265
|
|
63,130
|
|
Cost of
pass-thru revenue
|
8,150
|
|
9,018
|
|
26,511
|
|
28,121
|
|
|
Total costs of
revenues
|
44,567
|
|
55,333
|
|
144,991
|
|
175,734
|
|
|
Gross
profit
|
8,986
|
|
9,421
|
|
29,888
|
|
28,859
|
SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES
|
10,656
|
|
9,401
|
|
34,395
|
|
29,807
|
|
Income (loss) from operations
|
(1,670)
|
|
20
|
|
(4,507)
|
|
(948)
|
INTEREST
EXPENSE (INCOME), NET
|
162
|
|
236
|
|
564
|
|
758
|
|
Income (loss) before income taxes
|
(1,832)
|
|
(216)
|
|
(5,071)
|
|
(1,706)
|
INCOME TAX
PROVISION (BENEFIT)
|
120
|
|
154
|
|
411
|
|
457
|
NET INCOME
(LOSS)
|
|
$
(1,952)
|
|
$
(370)
|
|
$
(5,482)
|
|
$
(2,163)
|
NON-GAAP INCOME
(LOSS)
|
|
$
(1,342)
|
|
$
(62)
|
|
$
(1,742)
|
|
$
167
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME
(LOSS) PER SHARE:
|
|
|
|
|
|
|
|
|
Basic
|
|
|
$
(0.12)
|
|
$
(0.03)
|
|
$
(0.38)
|
|
$
(0.17)
|
|
Diluted
|
|
|
$
(0.12)
|
|
$
(0.03)
|
|
$
(0.38)
|
|
$
(0.17)
|
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED
AVERAGE NUMBER OF SHARES OUTSTANDING:
|
|
|
|
|
|
|
|
|
Basic
|
|
|
16,121
|
|
12,783
|
|
14,490
|
|
12,777
|
|
Diluted
|
|
|
16,121
|
|
12,783
|
|
14,490
|
|
12,777
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
|
$
767
|
|
$
2,522
|
|
$
3,026
|
|
$
5,886
|
ADJUSTED
EBITDA
|
|
$
1,377
|
|
$
2,830
|
|
$
6,766
|
|
$
8,216
|
|
|
|
|
|
|
|
|
|
|
|
(A) The financial
data above should be read in conjunction with the audited
consolidated financial statements of PFSweb, Inc. included in its Form 10-K for the year
ended December 31, 2012.
|
|
|
|
|
|
|
|
|
|
|
|
|
PFSweb, Inc. and
Subsidiaries
|
Reconciliation of
certain Non-GAAP Items to GAAP
|
(In Thousands, Except
Per Share Data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
|
|
September
30,
|
|
September
30,
|
|
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
NET INCOME
(LOSS)
|
|
$
(1,952)
|
|
$
(370)
|
|
$
(5,482)
|
|
$
(2,163)
|
|
Income tax
expense
|
120
|
|
154
|
|
411
|
|
457
|
|
Interest expense,
net
|
162
|
|
236
|
|
564
|
|
758
|
|
Depreciation and
amortization
|
2,437
|
|
2,502
|
|
7,533
|
|
6,834
|
EBITDA
|
|
|
$
767
|
|
$
2,522
|
|
$
3,026
|
|
$
5,886
|
|
Stock-based
compensation
|
610
|
|
308
|
|
1,195
|
|
1,014
|
|
Restructuring and
other charges
|
-
|
|
-
|
|
2,545
|
|
-
|
|
Lease terminations
costs
|
-
|
|
-
|
|
-
|
|
450
|
|
Move related
expenses
|
-
|
|
-
|
|
-
|
|
866
|
ADJUSTED
EBITDA
|
|
$
1,377
|
|
$
2,830
|
|
$
6,766
|
|
$
8,216
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
|
|
September
30,
|
|
September
30,
|
|
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME
(LOSS)
|
|
$
(1,952)
|
|
$
(370)
|
|
$
(5,482)
|
|
$
(2,163)
|
|
Stock-based
compensation
|
610
|
|
308
|
|
1,195
|
|
1,014
|
|
Restructuring and
other charges
|
-
|
|
-
|
|
2,545
|
|
-
|
|
Lease terminations
costs
|
-
|
|
-
|
|
-
|
|
450
|
|
Move related
expenses
|
-
|
|
-
|
|
-
|
|
866
|
NON-GAAP INCOME
(LOSS)
|
|
$
(1,342)
|
|
$
(62)
|
|
$
(1,742)
|
|
$
167
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME
(LOSS) PER SHARE:
|
|
|
|
|
|
|
|
|
Basic
|
|
|
$
(0.12)
|
|
$
(0.03)
|
|
$
(0.38)
|
|
$
(0.17)
|
|
Diluted
|
|
|
$
(0.12)
|
|
$
(0.03)
|
|
$
(0.38)
|
|
$
(0.17)
|
|
|
|
|
|
|
|
|
|
|
|
NON-GAAP INCOME
(LOSS) Per Share:
|
|
|
|
|
|
|
|
|
Basic
|
|
|
$
(0.08)
|
|
$
(0.00)
|
|
$
(0.12)
|
|
$
0.01
|
|
Diluted
|
|
|
$
(0.08)
|
|
$
(0.00)
|
|
$
(0.12)
|
|
$
0.01
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
|
|
September
30,
|
|
September
30,
|
|
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL
REVENUES
|
|
|
$
53,553
|
|
$
64,754
|
|
$
174,879
|
|
$
204,593
|
|
Pass-thru
revenue
|
|
(8,150)
|
|
(9,018)
|
|
(26,511)
|
|
(28,121)
|
|
Cost of product
revenue
|
(20,221)
|
|
(25,538)
|
|
(65,215)
|
|
(84,483)
|
SERVICE FEE
EQUIVALENT REVENUE
|
$
25,182
|
|
$
30,198
|
|
$
83,153
|
|
$
91,989
|
PFSweb, Inc. and
Subsidiaries
Preliminary Unaudited
Condensed Consolidated Balance Sheets
(In Thousands, Except
Share Data)
|
|
|
|
|
|
|
|
|
|
September
30,
|
|
December
31,
|
|
2013
|
|
2012
|
ASSETS
|
|
|
|
CURRENT
ASSETS:
|
|
|
|
Cash
and cash equivalents
|
$
21,293
|
|
$
19,626
|
Restricted
cash
|
466
|
|
283
|
Accounts receivable, net of allowance for doubtful accounts of $367
and
$450
at September 30, 2013 and December 31, 2012,
respectively
|
37,715
|
|
45,684
|
Inventories, net of reserves of $1,688 and $1,789 at September
30, 2013 and
December
31, 2012, respectively
|
17,326
|
|
24,654
|
Other receivables
|
7,645
|
|
7,675
|
Prepaid expenses and other current assets
|
4,590
|
|
4,346
|
Total current
assets
|
89,035
|
|
102,268
|
|
|
|
|
PROPERTY AND
EQUIPMENT, net
|
26,667
|
|
27,917
|
OTHER
ASSETS
|
2,880
|
|
3,286
|
Total
assets
|
118,582
|
|
133,471
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS EQUITY
|
|
|
|
CURRENT
LIABILITIES:
|
|
|
|
Current portion of long-term debt and capital lease
obligations
|
$
8,820
|
|
$
16,660
|
Trade accounts payable
|
26,153
|
|
40,493
|
Deferred revenue
|
9,166
|
|
6,648
|
Accrued expenses
|
21,299
|
|
23,097
|
Total current
liabilities
|
65,438
|
|
86,898
|
|
|
|
|
LONG-TERM DEBT AND
CAPITAL LEASE OBLIGATIONS, less current portion
|
3,473
|
|
5,400
|
DEFERRED
REVENUE
|
6,177
|
|
7,562
|
DEFERRED
RENT
|
5,142
|
|
5,560
|
Total
liabilities
|
80,230
|
|
105,420
|
|
|
|
|
COMMITMENTS AND
CONTINGENCIES
|
|
|
|
|
|
|
|
SHAREHOLDERS'
EQUITY:
|
|
|
|
Preferred stock, $1.00 par value; 1,000,000 shares
authorized;
none issued and outstanding
|
-
|
|
-
|
Common stock, $.001 par value; 35,000,000 shares
authorized;
16,199,431
and 12,812,386 shares issued at September 30, 2013 and
December
31, 2012, respectively; and 16,165,964 and 12,778,919
shares
outstanding as of September 30, 2013 and
December
31, 2012, respectively
|
16
|
|
13
|
Additional paid-in capital
|
121,663
|
|
106,018
|
Accumulated deficit
|
(84,891)
|
|
(79,409)
|
Accumulated other comprehensive income
|
1,689
|
|
1,554
|
Treasury stock at cost, 33,467 shares
|
(125)
|
|
(125)
|
Total
shareholders' equity
|
38,352
|
|
28,051
|
Total liabilities and shareholders' equity
|
$
118,582
|
|
$
133,471
|
PFSweb, Inc. and
Subsidiaries
|
Preliminary Unaudited
Consolidating Statements of Operations
|
For the Three Months
Ended September 30, 2013
|
(In
Thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Business
&
|
|
|
|
|
|
|
|
|
PFSweb
|
|
Retail
Connect
|
|
Eliminations
|
|
Consolidated
|
REVENUES:
|
|
|
|
|
|
|
|
|
|
|
Product
revenue, net
|
|
$
-
|
|
$
21,495
|
|
$
-
|
|
$
21,495
|
|
Service fee
revenue
|
|
22,123
|
|
1,785
|
|
-
|
|
23,908
|
|
Service fee
revenue - affiliate
|
2,198
|
|
312
|
|
(2,510)
|
|
-
|
|
Pass-thru
revenue
|
|
8,150
|
|
-
|
|
-
|
|
8,150
|
|
|
Total
revenues
|
32,471
|
|
23,592
|
|
(2,510)
|
|
53,553
|
|
|
|
|
|
|
|
|
|
|
|
COSTS OF
REVENUES:
|
|
|
|
|
|
|
|
|
|
Cost of product
revenue
|
-
|
|
20,221
|
|
-
|
|
20,221
|
|
Cost of service
fee revenue
|
16,634
|
|
1,862
|
|
(2,300)
|
|
16,196
|
|
Cost of
pass-thru revenue
|
8,150
|
|
-
|
|
-
|
|
8,150
|
|
|
Total costs of
revenues
|
24,784
|
|
22,083
|
|
(2,300)
|
|
44,567
|
|
|
Gross
profit
|
7,687
|
|
1,509
|
|
(210)
|
|
8,986
|
SELLING,
GENERAL AND ADMINISTRATIVE EXPENSES
|
9,510
|
|
1,356
|
|
(210)
|
|
10,656
|
|
Income (loss) from operations
|
(1,823)
|
|
153
|
|
-
|
|
(1,670)
|
INTEREST
EXPENSE (INCOME), NET
|
11
|
|
151
|
|
-
|
|
162
|
|
Income (loss) before income taxes
|
(1,834)
|
|
2
|
|
-
|
|
(1,832)
|
INCOME TAX
PROVISION (BENEFIT)
|
58
|
|
62
|
|
|
|
120
|
NET INCOME
(LOSS)
|
|
$
(1,892)
|
|
$
(60)
|
|
$
-
|
|
$
(1,952)
|
NON-GAAP NET
INCOME (LOSS)
|
$
(1,282)
|
|
$
(60)
|
|
$
-
|
|
$
(1,342)
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
|
$
576
|
|
$
191
|
|
$
-
|
|
$
767
|
ADJUSTED
EBITDA
|
|
$
1,186
|
|
$
191
|
|
$
-
|
|
$
1,377
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
A reconciliation of
NET INCOME (LOSS) to EBITDA and ADJUSTED EBITDA follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME
(LOSS)
|
|
$
(1,892)
|
|
$
(60)
|
|
$
-
|
|
(1,952)
|
|
Income tax expense
(benefit)
|
58
|
|
62
|
|
-
|
|
120
|
|
Interest expense
(income), net
|
11
|
|
151
|
|
-
|
|
162
|
|
Depreciation and
amortization
|
2,399
|
|
38
|
|
-
|
|
2,437
|
EBITDA
|
|
|
$
576
|
|
$
191
|
|
$
-
|
|
$
767
|
|
Stock-based
compensation
|
610
|
|
-
|
|
-
|
|
610
|
|
Restructuring and
other charges
|
-
|
|
-
|
|
-
|
|
-
|
ADJUSTED
EBITDA
|
|
$
1,186
|
|
$
191
|
|
$
-
|
|
$
1,377
|
|
|
|
|
|
|
|
|
|
|
|
A reconciliation of
NET INCOME (LOSS) to NON-GAAP NET INCOME (LOSS) follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME
(LOSS)
|
|
$
(1,892)
|
|
$
(60)
|
|
$
-
|
|
$
(1,952)
|
|
Stock-based
compensation
|
610
|
|
-
|
|
-
|
|
610
|
|
Restructuring and
other charges
|
-
|
|
-
|
|
-
|
|
-
|
NON-GAAP NET
INCOME (LOSS)
|
$
(1,282)
|
|
$
(60)
|
|
$
-
|
|
$
(1,342)
|
|
|
|
|
|
|
|
|
|
|
|
Note: Business
and Retail Connect includes our Supplies Distributors and PFSweb
Retail Connect operations, which operate similar financial models
on behalf of our client relationships.
|
PFSweb, Inc. and
Subsidiaries
|
Preliminary Unaudited
Consolidating Statements of Operations
|
For the Nine Months
Ended September 30, 2013
|
(In
Thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Business
&
|
|
|
|
|
|
|
|
|
PFSweb
|
|
Retail
Connect
|
|
Eliminations
|
|
Consolidated
|
REVENUES:
|
|
|
|
|
|
|
|
|
|
|
Product
revenue, net
|
|
$
-
|
|
$
69,660
|
|
$
-
|
|
$
69,660
|
|
Service fee
revenue
|
|
73,868
|
|
4,840
|
|
-
|
|
78,708
|
|
Service fee
revenue - affiliate
|
6,467
|
|
1,110
|
|
(7,577)
|
|
-
|
|
Pass-thru
revenue
|
|
26,511
|
|
-
|
|
-
|
|
26,511
|
|
|
Total
revenues
|
106,846
|
|
75,610
|
|
(7,577)
|
|
174,879
|
|
|
|
|
|
|
|
|
|
|
|
COSTS OF
REVENUES:
|
|
|
|
|
|
|
|
|
|
Cost of product
revenue
|
-
|
|
65,215
|
|
-
|
|
65,215
|
|
Cost of service
fee revenue
|
54,815
|
|
5,161
|
|
(6,711)
|
|
53,265
|
|
Cost of
pass-thru revenue
|
26,511
|
|
-
|
|
-
|
|
26,511
|
|
|
Total costs of
revenues
|
81,326
|
|
70,376
|
|
(6,711)
|
|
144,991
|
|
|
Gross
profit
|
25,520
|
|
5,234
|
|
(866)
|
|
29,888
|
SELLING,
GENERAL AND ADMINISTRATIVE EXPENSES
|
30,673
|
|
4,588
|
|
(866)
|
|
34,395
|
|
Income (loss) from operations
|
(5,153)
|
|
646
|
|
-
|
|
(4,507)
|
INTEREST
EXPENSE (INCOME), NET
|
113
|
|
451
|
|
-
|
|
564
|
|
Income (loss) before income taxes
|
(5,266)
|
|
195
|
|
-
|
|
(5,071)
|
INCOME TAX
PROVISION (BENEFIT)
|
200
|
|
211
|
|
-
|
|
411
|
NET INCOME
(LOSS)
|
|
$
(5,466)
|
|
$
(16)
|
|
$
-
|
|
$
(5,482)
|
NON-GAAP NET
INCOME (LOSS)
|
$
(1,726)
|
|
$
(16)
|
|
$
-
|
|
$
(1,742)
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
|
$
2,264
|
|
$
762
|
|
$
-
|
|
$
3,026
|
ADJUSTED
EBITDA
|
|
$
6,004
|
|
$
762
|
|
$
-
|
|
$
6,766
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
A reconciliation of
NET INCOME (LOSS) to EBITDA and ADJUSTED EBITDA follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME
(LOSS)
|
|
$
(5,466)
|
|
$
(16)
|
|
$
-
|
|
(5,482)
|
|
Income tax expense
(benefit)
|
200
|
|
211
|
|
-
|
|
411
|
|
Interest expense
(income), net
|
113
|
|
451
|
|
-
|
|
564
|
|
Depreciation and
amortization
|
7,417
|
|
116
|
|
-
|
|
7,533
|
EBITDA
|
|
|
$
2,264
|
|
$
762
|
|
$
-
|
|
$
3,026
|
|
Stock-based
compensation
|
1,195
|
|
-
|
|
-
|
|
1,195
|
|
Restructuring and
other charges
|
2,545
|
|
-
|
|
-
|
|
2,545
|
ADJUSTED
EBITDA
|
|
$
6,004
|
|
$
762
|
|
$
-
|
|
$
6,766
|
|
|
|
|
|
|
|
|
|
|
|
A reconciliation of
NET INCOME (LOSS) to NON-GAAP NET INCOME (LOSS) follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME
(LOSS)
|
|
$
(5,466)
|
|
$
(16)
|
|
$
-
|
|
$
(5,482)
|
|
Stock-based
compensation
|
1,195
|
|
-
|
|
-
|
|
1,195
|
|
Restructuring and
other charges
|
2,545
|
|
-
|
|
-
|
|
2,545
|
NON-GAAP NET
INCOME (LOSS)
|
$
(1,726)
|
|
$
(16)
|
|
$
-
|
|
$
(1,742)
|
|
|
|
|
|
|
|
|
|
|
|
Note: Business
and Retail Connect includes our Supplies Distributors and PFSweb
Retail Connect operations, which operate similar financial models
on behalf of our client relationships.
|
PFSweb, Inc. and
Subsidiaries
|
Unaudited
Consolidating Statements of Operations
|
For the Three Months
Ended September 30, 2012
|
(In
Thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Business
&
|
|
|
|
|
|
|
|
|
PFSweb
|
|
Retail
Connect
|
|
Eliminations
|
|
Consolidated
|
REVENUES:
|
|
|
|
|
|
|
|
|
|
|
Product
revenue, net
|
|
$
-
|
|
$
27,476
|
|
$
-
|
|
$
27,476
|
|
Service fee
revenue
|
|
28,260
|
|
-
|
|
-
|
|
28,260
|
|
Service fee
revenue - affiliate
|
1,034
|
|
143
|
|
(1,177)
|
|
-
|
|
Pass-thru
revenue
|
|
9,018
|
|
-
|
|
-
|
|
9,018
|
|
|
Total
revenues
|
38,312
|
|
27,619
|
|
(1,177)
|
|
64,754
|
|
|
|
|
|
|
|
|
|
|
|
COSTS OF
REVENUES:
|
|
|
|
|
|
|
|
|
|
Cost of product
revenue
|
-
|
|
25,538
|
|
-
|
|
25,538
|
|
Cost of service
fee revenue
|
21,336
|
|
143
|
|
(702)
|
|
20,777
|
|
Cost of
pass-thru revenue
|
9,018
|
|
-
|
|
-
|
|
9,018
|
|
|
Total costs of
revenues
|
30,354
|
|
25,681
|
|
(702)
|
|
55,333
|
|
|
Gross
profit
|
7,958
|
|
1,938
|
|
(475)
|
|
9,421
|
SELLING,
GENERAL AND ADMINISTRATIVE EXPENSES
|
8,526
|
|
1,350
|
|
(475)
|
|
9,401
|
|
Income (loss) from operations
|
(568)
|
|
588
|
|
-
|
|
20
|
INTEREST
EXPENSE (INCOME), NET
|
49
|
|
187
|
|
-
|
|
236
|
|
Income (loss) before income taxes
|
(617)
|
|
401
|
|
-
|
|
(216)
|
INCOME TAX
PROVISION (BENEFIT)
|
(23)
|
|
177
|
|
-
|
|
154
|
NET INCOME
(LOSS)
|
|
$
(594)
|
|
$
224
|
|
$
-
|
|
$
(370)
|
NON-GAAP NET
INCOME (LOSS)
|
$
(286)
|
|
$
224
|
|
$
-
|
|
$
(62)
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
|
$
1,908
|
|
$
614
|
|
$
-
|
|
$
2,522
|
ADJUSTED
EBITDA
|
|
$
2,216
|
|
$
614
|
|
$
-
|
|
$
2,830
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
A reconciliation of
NET INCOME (LOSS) to EBITDA and ADJUSTED EBITDA follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME
(LOSS)
|
|
$
(594)
|
|
$
224
|
|
$
-
|
|
(370)
|
|
Income tax expense
(benefit)
|
(23)
|
|
177
|
|
-
|
|
154
|
|
Interest expense
(income), net
|
49
|
|
187
|
|
-
|
|
236
|
|
Depreciation and
amortization
|
2,476
|
|
26
|
|
-
|
|
2,502
|
EBITDA
|
|
|
$
1,908
|
|
$
614
|
|
$
-
|
|
$
2,522
|
|
Stock-based
compensation
|
308
|
|
-
|
|
-
|
|
308
|
ADJUSTED
EBITDA
|
|
$
2,216
|
|
$
614
|
|
$
-
|
|
$
2,830
|
|
|
|
|
|
|
|
|
|
|
|
A reconciliation of
NET INCOME (LOSS) to NON-GAAP NET INCOME (LOSS) follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME
(LOSS)
|
|
$
(594)
|
|
$
224
|
|
$
-
|
|
$
(370)
|
|
Stock-based
compensation
|
308
|
|
-
|
|
-
|
|
308
|
NON-GAAP NET
INCOME (LOSS)
|
$
(286)
|
|
$
224
|
|
$
-
|
|
$
(62)
|
|
|
|
|
|
|
|
|
|
|
|
Note: Business
and Retail Connect includes our Supplies Distributors and PFSweb
Retail Connect operations, which operate similar financial models
on behalf of our client relationships.
|
PFSweb, Inc. and
Subsidiaries
|
Unaudited
Consolidating Statements of Operations
|
For the Nine Months
Ended September 30, 2012
|
(In
Thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Business
&
|
|
|
|
|
|
|
|
|
PFSweb
|
|
Retail
Connect
|
|
Eliminations
|
|
Consolidated
|
REVENUES:
|
|
|
|
|
|
|
|
|
|
|
Product
revenue, net
|
|
$
-
|
|
$
91,450
|
|
$
-
|
|
$
91,450
|
|
Service fee
revenue
|
|
85,022
|
|
-
|
|
-
|
|
85,022
|
|
Service fee
revenue - affiliate
|
3,620
|
|
451
|
|
(4,071)
|
|
-
|
|
Pass-thru
revenue
|
|
28,121
|
|
-
|
|
|
|
28,121
|
|
|
Total
revenues
|
116,763
|
|
91,901
|
|
(4,071)
|
|
204,593
|
|
|
|
|
|
|
|
|
|
|
|
COSTS OF
REVENUES:
|
|
|
|
|
|
|
|
|
|
Cost of product
revenue
|
-
|
|
84,483
|
|
-
|
|
84,483
|
|
Cost of service
fee revenue
|
64,879
|
|
451
|
|
(2,200)
|
|
63,130
|
|
Cost of
pass-thru revenue
|
28,121
|
|
-
|
|
-
|
|
28,121
|
|
|
Total costs of
revenues
|
93,000
|
|
84,934
|
|
(2,200)
|
|
175,734
|
|
|
Gross
profit
|
23,763
|
|
6,967
|
|
(1,871)
|
|
28,859
|
SELLING,
GENERAL AND ADMINISTRATIVE EXPENSES
|
26,659
|
|
5,019
|
|
(1,871)
|
|
29,807
|
|
Income (loss) from operations
|
(2,896)
|
|
1,948
|
|
-
|
|
(948)
|
INTEREST
EXPENSE (INCOME), NET
|
140
|
|
618
|
|
-
|
|
758
|
|
Income (loss) before income taxes
|
(3,036)
|
|
1,330
|
|
-
|
|
(1,706)
|
INCOME TAX
PROVISION (BENEFIT)
|
(92)
|
|
549
|
|
-
|
|
457
|
NET INCOME
(LOSS)
|
|
$
(2,944)
|
|
$
781
|
|
$
-
|
|
$
(2,163)
|
NON-GAAP NET
INCOME (LOSS)
|
$
(614)
|
|
$
781
|
|
$
-
|
|
$
167
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
|
$
3,872
|
|
$
2,014
|
|
$
-
|
|
$
5,886
|
ADJUSTED
EBITDA
|
|
$
6,202
|
|
$
2,014
|
|
$
-
|
|
$
8,216
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
A reconciliation of
NET INCOME (LOSS) to EBITDA and ADJUSTED EBITDA follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME
(LOSS)
|
|
$
(2,944)
|
|
$
781
|
|
$
-
|
|
(2,163)
|
|
Income tax expense
(benefit)
|
(92)
|
|
549
|
|
-
|
|
457
|
|
Interest expense
(income), net
|
140
|
|
618
|
|
-
|
|
758
|
|
Depreciation and
amortization
|
6,768
|
|
66
|
|
-
|
|
6,834
|
EBITDA
|
|
|
$
3,872
|
|
$
2,014
|
|
$
-
|
|
$
5,886
|
|
Stock-based
compensation
|
1,014
|
|
-
|
|
-
|
|
1,014
|
|
Lease termination
costs
|
450
|
|
-
|
|
-
|
|
450
|
|
Move related
expenses
|
866
|
|
|
|
|
|
866
|
ADJUSTED
EBITDA
|
|
$
6,202
|
|
$
2,014
|
|
$
-
|
|
$
8,216
|
|
|
|
|
|
|
|
|
|
|
|
A reconciliation of
NET INCOME (LOSS) to NON-GAAP NET INCOME (LOSS) follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME
(LOSS)
|
|
$
(2,944)
|
|
$
781
|
|
$
-
|
|
$
(2,163)
|
|
Stock-based
compensation
|
1,014
|
|
-
|
|
-
|
|
1,014
|
|
Lease termination
costs
|
450
|
|
-
|
|
-
|
|
450
|
|
Move related
expenses
|
866
|
|
|
|
|
|
866
|
NON-GAAP NET
INCOME (LOSS)
|
$
(614)
|
|
$
781
|
|
$
-
|
|
$
167
|
|
|
|
|
|
|
|
|
|
|
|
Note: Business
and Retail Connect includes our Supplies Distributors and PFSweb
Retail Connect operations, which operate similar financial models
on behalf of our client relationships.
|
PFSweb, Inc. and
Subsidiaries
Unaudited Condensed
Consolidating Balance Sheets
as of September 30,
2013
(In
Thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Business
&
|
|
|
|
|
|
PFSweb
|
|
Retail
Connect
|
|
Eliminations
|
|
Consolidated
|
ASSETS
|
|
|
|
|
|
|
|
CURRENT
ASSETS:
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
$
14,845
|
|
$
6,448
|
|
$
-
|
|
$
21,293
|
Restricted cash
|
-
|
|
466
|
|
-
|
|
466
|
Accounts receivable, net
|
26,840
|
|
11,600
|
|
(725)
|
|
37,715
|
Inventories, net
|
-
|
|
17,326
|
|
-
|
|
17,326
|
Other receivables
|
-
|
|
7,645
|
|
-
|
|
7,645
|
Prepaid expenses and other current assets
|
3,204
|
|
1,386
|
|
-
|
|
4,590
|
Total current
assets
|
44,889
|
|
44,871
|
|
(725)
|
|
89,035
|
|
|
|
|
|
|
|
|
PROPERTY AND
EQUIPMENT, net
|
26,406
|
|
261
|
|
-
|
|
26,667
|
RECEIVABLE/INVESTMENT
IN AFFILIATES
|
13,992
|
|
-
|
|
(13,992)
|
|
–
|
OTHER
ASSETS
|
2,787
|
|
93
|
|
-
|
|
2,880
|
Total
assets
|
88,074
|
|
45,225
|
|
(14,717)
|
|
118,582
|
|
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS EQUITY
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES:
|
|
|
|
|
|
|
|
Current portion of long-term debt and capital lease
obligations
|
$
4,094
|
|
$
4,726
|
|
$
-
|
|
$
8,820
|
Trade accounts payable
|
6,142
|
|
20,736
|
|
(725)
|
|
26,153
|
Deferred revenue
|
9,161
|
|
5
|
|
-
|
|
9,166
|
Accrued expenses
|
15,306
|
|
5,993
|
|
-
|
|
21,299
|
Total current
liabilities
|
34,703
|
|
31,460
|
|
(725)
|
|
65,438
|
|
|
|
|
|
|
|
|
LONG-TERM DEBT AND
CAPITAL LEASE OBLIGATIONS, less current portion
|
3,473
|
|
-
|
|
-
|
|
3,473
|
PAYABLE TO
AFFILIATES
|
-
|
|
23,045
|
|
(23,045)
|
|
–
|
DEFERRED
REVENUE
|
6,177
|
|
-
|
|
-
|
|
6,177
|
DEFERRED
RENT
|
5,142
|
|
-
|
|
-
|
|
5,142
|
Total
liabilities
|
49,495
|
|
54,505
|
|
(23,770)
|
|
80,230
|
|
|
|
|
|
|
|
|
COMMITMENTS AND
CONTINGENCIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SHAREHOLDERS'
EQUITY:
|
|
|
|
|
|
|
|
Common stock
|
16
|
|
19
|
|
(19)
|
|
16
|
Capital contributions
|
-
|
|
1,000
|
|
(1,000)
|
|
–
|
Additional paid-in capital
|
121,663
|
|
28,060
|
|
(28,060)
|
|
121,663
|
Retained earnings (accumulated deficit)
|
(84,664)
|
|
(40,623)
|
|
40,396
|
|
(84,891)
|
Accumulated other comprehensive income
|
1,689
|
|
2,264
|
|
(2,264)
|
|
1,689
|
Treasury stock
|
(125)
|
|
-
|
|
-
|
|
(125)
|
Total shareholders'
equity
|
38,579
|
|
(9,280)
|
|
9,053
|
|
38,352
|
Total liabilities and
shareholders' equity
|
$
88,074
|
|
$
45,225
|
|
$
(14,717)
|
|
$
118,582
|
PFSweb, Inc. and
Subsidiaries
|
Unaudited Condensed
Consolidating Balance Sheets
|
as of December 31,
2012
|
(In
Thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Business
&
|
|
|
|
|
|
|
|
|
PFSweb
|
|
Retail
Connect
|
|
Eliminations
|
|
Consolidated
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
CURRENT
ASSETS:
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
$
13,079
|
|
$
6,547
|
|
$
-
|
|
$
19,626
|
|
Restricted
cash
|
|
-
|
|
283
|
|
-
|
|
283
|
|
Accounts
receivable, net
|
34,831
|
|
11,574
|
|
(721)
|
|
45,684
|
|
Inventories,
net
|
|
-
|
|
24,654
|
|
-
|
|
24,654
|
|
Other
receivables
|
|
-
|
|
7,675
|
|
-
|
|
7,675
|
|
Prepaid
expenses and other current assets
|
2,817
|
|
1,529
|
|
-
|
|
4,346
|
|
|
Total current
assets
|
50,727
|
|
52,262
|
|
(721)
|
|
102,268
|
|
|
|
|
|
|
|
|
|
|
|
PROPERTY AND
EQUIPMENT, net
|
27,651
|
|
266
|
|
-
|
|
27,917
|
RECEIVABLE/INVESTMENT IN
AFFILIATES
|
13,396
|
|
-
|
|
(13,396)
|
|
-
|
OTHER
ASSETS
|
|
|
3,166
|
|
120
|
|
-
|
|
3,286
|
|
|
Total
assets
|
94,940
|
|
52,648
|
|
(14,117)
|
|
133,471
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS EQUITY
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES:
|
|
|
|
|
|
|
|
|
|
Current portion of
long-term debt and capital lease obligations
|
$
13,072
|
|
$
3,588
|
|
$
-
|
|
$
16,660
|
|
Trade accounts
payable
|
12,109
|
|
29,105
|
|
(721)
|
|
40,493
|
|
Deferred
revenue
|
|
6,573
|
|
75
|
|
-
|
|
6,648
|
|
Accrued
expenses
|
|
16,743
|
|
6,354
|
|
-
|
|
23,097
|
|
|
Total current
liabilities
|
48,497
|
|
39,122
|
|
(721)
|
|
86,898
|
|
|
|
|
|
|
|
|
|
|
|
LONG-TERM DEBT
AND CAPITAL LEASE OBLIGATIONS, less current
portion
|
5,400
|
|
-
|
|
-
|
|
5,400
|
PAYABLE TO
AFFILIATES
|
|
-
|
|
22,795
|
|
(22,795)
|
|
-
|
DEFERRED
REVENUE
|
|
7,562
|
|
-
|
|
-
|
|
7,562
|
DEFERRED
RENT
|
|
|
5,482
|
|
78
|
|
-
|
|
5,560
|
|
|
Total
liabilities
|
66,941
|
|
61,995
|
|
(23,516)
|
|
105,420
|
|
|
|
|
|
|
|
|
|
|
|
COMMITMENTS AND
CONTINGENCIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SHAREHOLDERS'
EQUITY:
|
|
|
|
|
|
|
|
|
|
Common
stock
|
|
13
|
|
19
|
|
(19)
|
|
13
|
|
Capital
contributions
|
|
-
|
|
1,000
|
|
(1,000)
|
|
-
|
|
Additional paid-in
capital
|
106,018
|
|
28,059
|
|
(28,059)
|
|
106,018
|
|
Retained earnings
(accumulated deficit)
|
(79,461)
|
|
(40,606)
|
|
40,658
|
|
(79,409)
|
|
Accumulated other
comprehensive income
|
1,554
|
|
2,181
|
|
(2,181)
|
|
1,554
|
|
Treasury
stock
|
|
(125)
|
|
-
|
|
-
|
|
(125)
|
|
|
Total shareholders'
equity
|
27,999
|
|
(9,347)
|
|
9,399
|
|
28,051
|
|
|
Total liabilities and
shareholders' equity
|
$
94,940
|
|
$
52,648
|
|
$
(14,117)
|
|
$
133,471
|
|
|
|
|
|
|
|
|
|
|
|
SOURCE PFSweb, Inc.