PFSweb, Inc. (NASDAQ: PFSW) (the "Company") is reporting results
for the fourth quarter and full year ended December 31, 2022.
“2022 was a strong year for PFS as we leveraged ongoing
tailwinds in the eCommerce industry,” said Mike Willoughby, CEO of
PFSweb. “Across our core verticals, our client brands focusing on
premium and luxury goods proved resilient by delivering strong
holiday order volumes. These tailwinds and our customized, brand
centric operational capabilities helped deliver our previously
announced record sales bookings year in 2022, generating sales
bookings of over $44 million in estimated annual contract value.
Growth from new and existing clients on our order fulfillment
platform allowed us to achieve a third straight year of record
annual order fulfillment activity, as well as numerous operational
records during the fourth quarter peak period. In fact, our annual
fulfillment revenue grew approximately 15% year-over-year,
illustrating the continued success of our expanding multi-node
fulfillment strategy.
“We successfully navigated labor cost volatility early last year
and significant restructuring of the Company following the LiveArea
transaction, including the completion of transition services to
Merkle. Additionally, despite headwinds from European and Canadian
foreign currency exchange rate fluctuations, our service fee
equivalent revenue growth and estimated pro forma standalone
adjusted EBITDA percentage of service fee equivalent revenue
performance came in line within our targeted 2022 guidance ranges.
With the aforementioned challenges, I am especially proud of our
team’s exceptional performance during the holiday peak and
throughout 2022 as we continued to grow our fulfillment platform,
post a record sales bookings year, and grow our client brand
portfolio to over 100 brands, positioning our company for strong
growth in 2023.”
Q4 2022 Financial and Operational Highlights vs. Q4
2021
- Total revenues increased 5% to $98.5
million.
- PFS Operations service fee
equivalent (SFE) revenue (a non-GAAP measure defined and reconciled
below) increased 4% to $65.6 million. Excluding approximately $1.4
million in unfavorable foreign exchange (FX) SFE revenue impacts,
SFE revenue would have increased approximately 6%.
- PFS Operations service fee gross
margin was 23.1% compared to 24.2%. The service fee gross margin in
the fourth quarter of 2022 reflects continued improvement on a
sequential basis as compared to previous quarterly results in 2022
due to the impact of increased productivity and improved contract
pricing implemented throughout the year.
- Net loss from continuing operations
was $2.1 million or $(0.09) per share, compared to a net loss from
continuing operations of $0.9 million or $(0.04) per share, largely
driven by a $2.0 million increase in stock-based compensation in
the fourth quarter of the current year as compared to the prior
year period.
- Consolidated adjusted EBITDA from
continuing operations (a non-GAAP measure defined and reconciled
below) increased 10% to $5.6 million compared to $5.0 million.
- PFS Operations adjusted EBITDA from
continuing operations (a non-GAAP measure defined and reconciled
below) increased 2% to $9.4 million compared to $9.2 million.
- Authorized special cash dividend of
$4.50 per share, which returns approximately $110 million of
capital generated from the LiveArea divestiture to PFSweb
shareholders.
Full Year 2022 Highlights
- Total revenues increased 6% to
$295.1 million, driven by growth across both new and existing
fulfillment clients throughout the year.
- PFS Operations SFE revenue (a
non-GAAP measure defined and reconciled below) increased 7% to
$200.3 million. Excluding approximately $3.5 million in unfavorable
annual FX SFE revenue impacts, SFE revenue would have increased by
approximately 9%, which is near the upper end of the Company’s
top-line CY2022 guidance range for annual SFE revenue growth.
- PFS Operations service fee gross
margin was 21.8% compared to 24.4%, reflecting the continued
impacts of industry-wide wage inflation pressures—especially early
in the year—and reduced higher margin, non-fulfillment-related
revenue within the Company’s service mix, partially offset by
improved contract pricing implemented throughout 2022.
- Net loss from continuing operations
was $20.2 million or $(0.89) per share, compared to a net loss from
continuing operations of $13.6 million or $(0.64) per share,
primarily driven by incremental restructuring related costs within
2022.
- Consolidated adjusted EBITDA from
continuing operations (a non-GAAP measure defined and reconciled
below) increased 67% to $5.0 million compared to $3.0 million.
- PFS Operations adjusted EBITDA from
continuing operations (a non-GAAP measure defined and reconciled
below) increased 3% to $23.2 million compared to $22.6
million.
- Estimated 2022 PFS pro forma
standalone AEBITDA percentage of service fee equivalent revenue was
approximately 8%.
2023 Momentum and Growth Objectives
Zach Thomann, COO and President of PFS, commented: “Following a
record bookings year in 2022, we believe we are well-positioned to
facilitate additional sales growth in the year ahead. In these
early months of 2023, we are working diligently to complete the
remaining implementations applicable to our 2022 client bookings.
Our sales momentum has continued into this year, with strong early
activity in our pipeline. As demand tailwinds persist among luxury
and premier brands within our core verticals—particularly within
health and beauty—many brands have continued investing in their
eCommerce channel to provide branded and efficient shopping
experiences. Our high-quality multi-node B2B and DTC fulfillment
services address this need, and we aim to continue supporting new
client growth and existing client expansions.
“To further supplement our growth objectives, we have remained
committed to rapidly activating and expanding our multi-node
fulfillment network. We quickly ramped our second Las Vegas
facility during our holiday peak season, reaching over 75%
utilization of this facility just months after opening. We are also
on track to open our second fulfillment center in the Dallas Fort
Worth area in the second half of this year, which gives us greater
capacity to support eCommerce consumers in the Southwestern portion
of the U.S. for our clients. From an international standpoint, we
are targeting new fulfillment space in the U.K., which would expand
our footprint beyond our current Southampton facility. By enhancing
the depth and breadth of our footprint, we can optimally scale our
fulfillment operations for new clients and support existing client
growth.
“With our corporate restructuring work substantially complete as
of year-end 2022, we believe we have built a leaner and more
efficient foundation from which to propel additional growth for PFS
in the year ahead. As we progress further into 2023, we aim to
further enhance our fulfillment platform through expanding our
multi-node fulfillment strategy, converting our strong sales
pipeline for continued growth, and driving our
fulfillment-as-a-service product offering to build a more robust
and flexible distribution network for our clients. Through our work
to streamline our business and support our expanding client base,
we believe we can facilitate a swift and sustained growth
trajectory for PFS.”
2023 Outlook
The Company is reiterating its previously stated 2023 outlook
for annual service fee revenue growth, which is expected to range
between at least 5% to 10%. Based on continued indications of
strong consumer and fulfillment service demand across its core
verticals, the Company is optimistic that it can achieve service
fee revenue growth at the upper end of this targeted range. As a
percentage of service fee revenue, PFSweb is targeting its annual
total company consolidated adjusted EBITDA to be within the range
of 6% to 8%, inclusive of remaining public company costs of
approximately 2% of service fee revenue in 2023.
Excluding public company costs, the Company is targeting total
company adjusted EBITDA as a percentage of service fee revenue to
range between 8% to 10% in 2023. PFSweb believes its estimates of
total company Adjusted EBITDA, net of the remaining public company
costs, provide an appropriate comparison to the estimated PFS
standalone adjusted EBITDA percentage of service fee equivalent
revenue metric disclosed in prior periods. The company also intends
to continue aggressive cost controls within the category of public
company costs with the objective to further reduce these costs
while continuing to support accelerating service fee revenue
growth.
Strategic Alternatives Process
PFSweb continues to work with its financial advisor, Raymond
James, on a review of a full range of strategic alternatives for
its PFS business. PFSweb is currently targeting completion of its
strategic review process during 2023, and it does not intend to
comment further regarding the review process unless or until the
review process is concluded or it has otherwise determined that
further disclosure is appropriate or required by law.
Conference Call
PFSweb will conduct a conference call today at 5:00 p.m. Eastern
time to discuss its results for the fourth quarter and full year
ended December 31, 2022.
PFSweb management will host the conference call, followed by a
question-and-answer period.
Date: Tuesday, March 14, 2023
Time: 5:00 p.m. Eastern time (2:00 p.m. Pacific time)
Registration Link:
https://register.vevent.com/register/BI43b5a161ecc14398b02f1461c50d99f0
Please call the conference telephone number 5-10 minutes prior
to the start time. If you have any difficulty connecting with the
conference call, please contact Gateway Group at
1-949-574-3860.
The conference call will be broadcast live and available for
replay here and via the investor relations section of the company’s
website at www.ir.pfsweb.com.
Forward-Looking Information
This press release contains 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.
You can identify these forward-looking statements by words such as
“may,” “will,” “would,” “should,” “could,” “expect,” “anticipate,”
“believe,” “intend,” “plan,” “potential,” “project,” “seek,”
“strive,” “predict,” “continue,” “target,” “estimate”, and other
similar expressions. These forward-looking statements involve risks
and uncertainties and may include assumptions as to how we may
perform in the future, including our overall performance for our
clients, as well as the impact of inflation, labor cost increases
and overall economic conditions. Although we believe the
expectations reflected in our forward-looking statements are
reasonable, we cannot guarantee these expectations will actually be
achieved. The Company’s 2022 10-K, and any subsequent amendments
thereto and our quarterly reports on Form 10-Q 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 periodic reports of the Company
and the Risk Factors described therein.
The Company 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.
Financial Statement Presentation Matters
The LiveArea segment has been presented as a discontinued
operation for all periods presented in this news release.
Non-GAAP Financial Measures
This news release contains certain non-GAAP measures, including
non-GAAP net income (loss) from continuing operations, earnings
before interest, income taxes, depreciation and amortization
(EBITDA) from continuing operations, adjusted EBITDA from
continuing operations and service fee equivalent revenue.
Non-GAAP net income (loss) from continuing operations represents
net income (loss) from continuing operations calculated in
accordance with U.S. GAAP as adjusted for the impact of non-cash
stock-based compensation expense, restructuring and other
costs.
EBITDA from continuing operations represents earnings (or
losses) before interest, income taxes, depreciation, and
amortization. Adjusted EBITDA from continuing operations further
eliminates the effect of stock-based compensation, as well as
restructuring and other.
PFS pro forma standalone AEBITDA percentage of service fee
equivalent revenue measures estimated Adjusted EBITDA profitability
for the PFS business on a pro forma basis as if the company were
operating in a non-public environment without certain corporate
overhead costs and after taking into account the impact of
restructuring activity and other client contract modifications.
Non-GAAP net income (loss) from continuing operations, EBITDA
from continuing operations, adjusted EBITDA from continuing
operations 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 costs, and EBITDA from continuing
operations and adjusted EBITDA from continuing operations further
eliminate the effect of financing, remaining 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.
The Company has presented non-GAAP financial measures for the
PFS Operations business including total revenues, service fee
equivalent revenue, cost of service fee revenue, gross profit,
direct contribution, and adjusted EBITDA which include adjustments
for certain LiveArea related revenue activity and unallocated
corporate costs. Such measures are reconciled below.
The Company believes these non-GAAP measures provide useful
information to both management and investors by focusing on certain
operational metrics and excluding certain expenses in order to
present its core operating performance and 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.
PFS, the business unit of PFSweb, Inc. (NASDAQ: PFSW) is a
premier eCommerce order fulfillment provider. We facilitate each
operational step of an eCommerce order in support of DTC and B2B
retail brands and specialize in health & beauty, fashion &
apparel, jewelry, and consumer packaged goods. Our scalable
solutions support customized pick/pack/ship services that deliver
on brand ethos with each order. A proven order management platform,
as well as high-touch customer care, reinforce our operation. With
20+ years as an industry leader, PFS is the BPO of choice for
brand-centric companies and household brand names, such as L’Oréal
USA, Champion, Pandora, Shiseido Americas, Kendra Scott, the United
States Mint, and many more. The company is headquartered in Irving,
TX with additional locations around the globe. For more
information, visit www.pfscommerce.com or ir.pfsweb.com for
investor information.
Investor Relations: Cody Slach or Jackie
KeshnerGateway Group, Inc. 1-949-574-3860 PFSW@gatewayir.com
PFSWEB, INC. AND
SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In Thousands, Except Share
Data)
|
December 31, 2022 |
|
December 31, 2021 |
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$ |
30,034 |
|
|
$ |
152,332 |
|
Restricted cash |
|
— |
|
|
|
214 |
|
Accounts receivable, net of allowance for doubtful accounts of $365
and $867 at December 31, 2022 and December 31, 2021,
respectively |
|
82,540 |
|
|
|
78,024 |
|
Inventories, net of reserves of $— and $57 at December 31,
2022 and December 31, 2021, respectively |
|
— |
|
|
|
3,133 |
|
Other receivables |
|
9,578 |
|
|
|
7,005 |
|
Prepaid expenses and other current assets |
|
7,665 |
|
|
|
7,244 |
|
Total current assets |
|
129,817 |
|
|
|
247,952 |
|
Property and equipment,
net |
|
20,888 |
|
|
|
19,315 |
|
Operating lease right-of-use
assets, net |
|
30,841 |
|
|
|
35,370 |
|
Goodwill |
|
21,310 |
|
|
|
22,218 |
|
Other assets |
|
1,806 |
|
|
|
1,611 |
|
Total assets |
$ |
204,662 |
|
|
$ |
326,466 |
|
LIABILITIES AND SHAREHOLDERS’ EQUITY |
|
|
|
Current liabilities: |
|
|
|
Trade accounts payable |
$ |
38,518 |
|
|
$ |
36,450 |
|
Accrued expenses |
|
36,973 |
|
|
|
31,643 |
|
Current portion of operating lease liabilities |
|
8,284 |
|
|
|
10,104 |
|
Current portion of finance lease obligations |
|
72 |
|
|
|
222 |
|
Deferred revenue |
|
3,906 |
|
|
|
4,391 |
|
Total current liabilities |
|
87,753 |
|
|
|
82,810 |
|
Finance lease obligations,
less current portion |
|
22 |
|
|
|
89 |
|
Deferred revenue, less current
portion |
|
870 |
|
|
|
833 |
|
Operating lease
liabilities |
|
25,478 |
|
|
|
30,393 |
|
Other liabilities |
|
4,315 |
|
|
|
2,565 |
|
Total liabilities |
|
118,438 |
|
|
|
116,690 |
|
|
|
|
|
Commitments and
Contingencies |
|
|
|
|
|
|
|
Shareholders' equity: |
|
|
|
Preferred stock, $1.00 par value; 1,000,000 shares authorized; none
issued or outstanding |
|
— |
|
|
|
— |
|
Common stock, $0.001 par value; 35,000,000 shares authorized;
22,725,116 and 22,131,546 issued at December 31, 2022 and
December 31, 2021, respectively; and 22,691,649 and 22,098,079
outstanding at December 31, 2022 and December 31, 2021,
respectively |
|
23 |
|
|
|
21 |
|
Additional paid-in capital |
|
180,353 |
|
|
|
177,511 |
|
Retained earnings (accumulated deficit) |
|
(90,893 |
) |
|
|
33,522 |
|
Accumulated other comprehensive loss |
|
(3,134 |
) |
|
|
(1,153 |
) |
Treasury stock at cost, 33,467 shares |
|
(125 |
) |
|
|
(125 |
) |
Total shareholders’ equity |
|
86,224 |
|
|
|
209,776 |
|
Total liabilities and shareholders’ equity |
$ |
204,662 |
|
|
$ |
326,466 |
|
|
|
|
|
|
|
|
|
PFSWEB, INC. AND
SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND
COMPREHENSIVE LOSS
(In Thousands, Except Per Share
Data)
|
(Unaudited)Three Months
EndedDecember 31, |
|
Twelve Months EndedDecember
31, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Revenues: |
|
|
|
|
|
|
|
Service fee revenue |
$ |
65,611 |
|
|
$ |
62,711 |
|
|
$ |
200,034 |
|
|
$ |
195,516 |
|
Product revenue, net |
|
— |
|
|
|
4,717 |
|
|
|
3,333 |
|
|
|
17,612 |
|
Pass-through revenue |
|
32,905 |
|
|
|
26,731 |
|
|
|
91,755 |
|
|
|
64,174 |
|
Total revenues |
|
98,516 |
|
|
|
94,159 |
|
|
|
295,122 |
|
|
|
277,302 |
|
Costs of Revenues: |
|
|
|
|
|
|
|
Cost of service fee revenue |
|
50,443 |
|
|
|
47,524 |
|
|
|
156,365 |
|
|
|
146,311 |
|
Cost of product revenue |
|
— |
|
|
|
4,315 |
|
|
|
3,059 |
|
|
|
16,580 |
|
Cost of pass-through revenue |
|
32,905 |
|
|
|
26,731 |
|
|
|
91,755 |
|
|
|
64,174 |
|
Total costs of revenues |
|
83,348 |
|
|
|
78,570 |
|
|
|
251,179 |
|
|
|
227,065 |
|
Gross profit |
|
15,168 |
|
|
|
15,589 |
|
|
|
43,943 |
|
|
|
50,237 |
|
Selling, general and
administrative expenses |
|
17,111 |
|
|
|
16,272 |
|
|
|
63,957 |
|
|
|
61,040 |
|
Loss from operations |
|
(1,943 |
) |
|
|
(683 |
) |
|
|
(20,014 |
) |
|
|
(10,803 |
) |
Interest (income) expense, net |
|
(727 |
) |
|
|
6 |
|
|
|
(1,426 |
) |
|
|
879 |
|
Loss on extinguishment of debt |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
426 |
|
Income (loss) from continuing
operations before income taxes |
|
(1,216 |
) |
|
|
(689 |
) |
|
|
(18,588 |
) |
|
|
(12,108 |
) |
Income tax expense, net |
|
929 |
|
|
|
254 |
|
|
|
1,617 |
|
|
|
1,530 |
|
Net income (loss) from
continuing operations |
|
(2,145 |
) |
|
|
(943 |
) |
|
|
(20,205 |
) |
|
|
(13,638 |
) |
|
|
|
|
|
|
|
|
Income from discontinued
operations before income taxes |
|
— |
|
|
|
— |
|
|
|
180 |
|
|
|
196,508 |
|
Income tax expense (benefit), net |
|
(3,467 |
) |
|
|
(679 |
) |
|
|
(3,467 |
) |
|
|
35,636 |
|
Net income from discontinued
operations |
|
3,467 |
|
|
|
679 |
|
|
|
3,647 |
|
|
|
160,872 |
|
|
|
|
|
|
|
|
|
Net income (loss) |
$ |
1,322 |
|
|
$ |
(264 |
) |
|
$ |
(16,558 |
) |
|
$ |
147,234 |
|
|
|
|
|
|
|
|
|
Basic earnings (loss) per
share: |
|
|
|
|
|
|
|
Net income (loss) from continuing operations per share |
$ |
(0.09 |
) |
|
$ |
(0.04 |
) |
|
$ |
(0.89 |
) |
|
$ |
(0.64 |
) |
Net income from discontinued operations per share |
|
0.15 |
|
|
|
0.03 |
|
|
|
0.16 |
|
|
|
7.51 |
|
Basic earnings (loss) per share |
$ |
0.06 |
|
|
$ |
(0.01 |
) |
|
$ |
(0.73 |
) |
|
$ |
6.87 |
|
Diluted earnings (loss) per
share: |
|
|
|
|
|
|
|
Net income (loss) from continuing operations per share |
$ |
(0.09 |
) |
|
$ |
(0.04 |
) |
|
$ |
(0.89 |
) |
|
$ |
(0.64 |
) |
Net income from discontinued operations per share |
|
0.15 |
|
|
|
0.03 |
|
|
|
0.16 |
|
|
|
7.51 |
|
Diluted earnings (loss) per share |
$ |
0.06 |
|
|
$ |
(0.01 |
) |
|
$ |
(0.73 |
) |
|
$ |
6.87 |
|
Weighted average number of
shares outstanding: |
|
|
|
|
|
|
|
Basic |
|
22,670 |
|
|
|
22,152 |
|
|
|
22,664 |
|
|
|
21,410 |
|
Diluted |
|
22,670 |
|
|
|
22,152 |
|
|
|
22,664 |
|
|
|
21,410 |
|
|
|
|
|
|
|
|
|
EBITDA from continuing
operations |
$ |
63 |
|
|
$ |
1,182 |
|
|
$ |
(12,458 |
) |
|
$ |
(3,186 |
) |
Adjusted EBITDA from
continuing operations |
$ |
5,556 |
|
|
$ |
5,046 |
|
|
$ |
5,009 |
|
|
$ |
2,996 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PFSWEB, INC. AND
SUBSIDIARIES
Unaudited Reconciliation of Certain Non-GAAP
Items to GAAP
(In Thousands)
|
Three Months EndedDecember
31, |
|
Twelve Months EndedDecember
31, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Net income (loss) from
continuing operations |
$ |
(2,145 |
) |
|
$ |
(943 |
) |
|
$ |
(20,205 |
) |
|
$ |
(13,638 |
) |
Income tax expense, net |
|
929 |
|
|
|
254 |
|
|
|
1,617 |
|
|
|
1,530 |
|
Loss on extinguishment of debt |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
426 |
|
Interest (income) expense, net |
|
(727 |
) |
|
|
6 |
|
|
|
(1,426 |
) |
|
|
879 |
|
Depreciation and amortization |
|
2,006 |
|
|
|
1,865 |
|
|
|
7,556 |
|
|
|
7,617 |
|
EBITDA from continuing
operations |
|
63 |
|
|
|
1,182 |
|
|
|
(12,458 |
) |
|
|
(3,186 |
) |
Gross margin on LiveArea activity(1) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(3,615 |
) |
Stock-based compensation |
|
2,983 |
|
|
|
981 |
|
|
|
5,928 |
|
|
|
4,784 |
|
Restructuring and other costs |
|
2,510 |
|
|
|
2,882 |
|
|
|
11,539 |
|
|
|
5,012 |
|
Adjusted EBITDA from
continuing operations |
|
5,556 |
|
|
|
5,046 |
|
|
|
5,009 |
|
|
|
2,996 |
|
|
Three Months EndedDecember
31, |
|
Twelve Months EndedDecember
31, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Net income (loss) from
continuing operations |
$ |
(2,145 |
) |
|
$ |
(943 |
) |
|
$ |
(20,205 |
) |
|
$ |
(13,638 |
) |
Stock-based compensation |
|
2,983 |
|
|
|
981 |
|
|
|
5,928 |
|
|
|
4,784 |
|
Restructuring and other costs |
|
2,510 |
|
|
|
2,882 |
|
|
|
11,539 |
|
|
|
5,012 |
|
Non-GAAP net income (loss)
from continuing operations |
$ |
3,347 |
|
|
$ |
2,920 |
|
|
$ |
(2,738 |
) |
|
$ |
(3,842 |
) |
|
Three Months EndedDecember
31, |
|
Twelve Months EndedDecember
31, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Total revenues from continuing
operations |
$ |
98,516 |
|
|
$ |
94,159 |
|
|
$ |
295,122 |
|
|
$ |
277,302 |
|
Pass-through revenue |
|
(32,905 |
) |
|
|
(26,731 |
) |
|
|
(91,755 |
) |
|
|
(64,174 |
) |
Cost of product revenue |
|
— |
|
|
|
(4,315 |
) |
|
|
(3,059 |
) |
|
|
(16,580 |
) |
Service fee revenue related to LiveArea activity(1) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(8,813 |
) |
Service fee equivalent
revenues from continuing operations |
$ |
65,611 |
|
|
$ |
63,113 |
|
|
$ |
200,308 |
|
|
$ |
187,735 |
|
(1) In completing the discontinued operations
presentation, certain LiveArea revenues, costs of revenues and
gross margin related to client contracts that were not fully
transferred to contracts directly operating under the LiveArea
operating entities as of the August 2021 transaction date were
maintained by PFS as part of the continuing operations
presentation. Subsequent to the LiveArea transaction date, revenues
billed and costs incurred under certain contracts where we have
subcontracted services to LiveArea are expected to be recorded as
pass-through revenue and pass-through costs, for as long as such
contracts continue to be maintained directly through PFS.
PFSWEB, INC. AND
SUBSIDIARIES
UNAUDITED NON-GAAP OPERATING INFORMATION
(In Thousands)
The following tables represents the financial information for
PFS Operations for the three and twelve months ended December 31,
2022 and 2021 excluding certain unallocated corporate costs and
certain non-continuing revenues and expenses.
|
Three Months EndedDecember
31, |
|
Twelve Months EndedDecember
31, |
PFS Operations (Non-GAAP) |
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Revenues: |
|
|
|
|
|
|
|
Service fee revenue |
$ |
65,611 |
|
|
$ |
62,711 |
|
|
$ |
200,034 |
|
|
$ |
195,516 |
|
Product revenue, net |
|
— |
|
|
|
4,717 |
|
|
|
3,333 |
|
|
|
17,612 |
|
Pass-through revenue |
|
32,905 |
|
|
|
26,731 |
|
|
|
91,755 |
|
|
|
64,174 |
|
Service fee revenue related to LiveArea activity(1) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(8,813 |
) |
Total revenues |
|
98,516 |
|
|
|
94,159 |
|
|
|
295,122 |
|
|
|
268,489 |
|
Costs of Revenues: |
|
|
|
|
|
|
|
Cost of service fee revenue |
|
50,443 |
|
|
|
47,524 |
|
|
|
156,365 |
|
|
|
146,311 |
|
Cost of product revenue |
|
— |
|
|
|
4,315 |
|
|
|
3,059 |
|
|
|
16,580 |
|
Cost of pass-through revenue |
|
32,905 |
|
|
|
26,731 |
|
|
|
91,755 |
|
|
|
64,174 |
|
Cost of service fee revenue related to LiveArea activity(1) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(5,198 |
) |
Total costs of revenues |
|
83,348 |
|
|
|
78,570 |
|
|
|
251,179 |
|
|
|
221,867 |
|
Gross profit |
|
15,168 |
|
|
|
15,589 |
|
|
|
43,943 |
|
|
|
46,622 |
|
Direct operating
expenses(2) |
|
8,483 |
|
|
|
8,985 |
|
|
|
30,657 |
|
|
|
33,829 |
|
Direct contribution |
|
6,685 |
|
|
|
6,604 |
|
|
|
13,286 |
|
|
|
12,793 |
|
Depreciation and
amortization(3) |
|
1,850 |
|
|
|
1,728 |
|
|
|
7,179 |
|
|
|
7,044 |
|
Stock-based
compensation(4) |
|
707 |
|
|
|
341 |
|
|
|
1,775 |
|
|
|
1,533 |
|
Restructuring and other
costs(5) |
|
143 |
|
|
|
491 |
|
|
|
989 |
|
|
|
1,218 |
|
Adjusted EBITDA |
$ |
9,385 |
|
|
$ |
9,164 |
|
|
$ |
23,229 |
|
|
$ |
22,588 |
|
|
|
|
|
|
|
|
|
Total Revenues |
$ |
98,516 |
|
|
$ |
94,159 |
|
|
$ |
295,122 |
|
|
$ |
268,489 |
|
Pass-through revenue |
|
(32,905 |
) |
|
|
(26,731 |
) |
|
|
(91,755 |
) |
|
|
(64,174 |
) |
Cost of product revenue |
|
— |
|
|
|
(4,315 |
) |
|
|
(3,059 |
) |
|
|
(16,580 |
) |
Service fee equivalent
revenue |
$ |
65,611 |
|
|
$ |
63,113 |
|
|
$ |
200,308 |
|
|
$ |
187,735 |
|
(1) In completing the discontinued operations
presentation, certain LiveArea revenues, costs of revenues and
gross profit related to client contracts that were not fully
transferred to contracts directly operating under the LiveArea
operating entities as of the August 2021 transaction date were
maintained by PFS as part of the continuing operations
presentation. Subsequent to the LiveArea transaction date, revenues
billed and costs incurred under these certain contracts where we
have subcontracted services to LiveArea are recorded as
pass-through revenue and pass-through costs, for as long as such
contracts continue to be maintained directly through PFS.
(2) Direct operating expenses for PFS Operations
exclude unallocated corporate costs included in consolidated
selling, general and administrative expense of $8.6 million
and $7.3 million for the three months ended December 31, 2022 and
2021, respectively, and $33.3 million and $27.2 million for
the twelve months ended December 31, 2022 and 2021,
respectively.
(3) Depreciation and amortization for PFS
Operations exclude depreciation and amortization applicable to
unallocated corporate costs included in consolidated selling,
general and administrative expense of approximately
$0.2 million and $0.1 million for the three months ended
December 31, 2022 and 2021, respectively, and approximately
$0.4 million and $0.6 million for the twelve months ended
December 31, 2022 and 2021, respectively.
(4) Stock based compensation for PFS Operations
exclude stock-based compensation applicable to unallocated
corporate costs included in consolidated selling, general and
administrative expense of $2.3 million and $0.6 million for
the three months ended December 31, 2022 and 2021, respectively,
and $4.2 million and $3.3 million for the twelve months ended
December 31, 2022 and 2021, respectively.
(5) Restructuring and other costs for PFS
Operations exclude restructuring and other costs applicable to
unallocated corporate costs included in consolidated selling,
general and administrative expense of $2.4 million for
both the three months ended December 31, 2022 and 2021, and
$10.5 million and $3.8 million for the twelve months
ended December 31, 2022 and 2021, respectively.
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