Second Quarter Total Net Revenues of $17.6
millionSecond Quarter GAAP Diluted EPS of $(0.09)Second Quarter
Adjusted EBITDA of $1.0 million
NetSol Technologies, Inc. (Nasdaq:NTWK), a leading global provider
of business services and enterprise application solutions to the
finance and leasing industry for 20 years, today announced
financial results for the fiscal 2017 second quarter ended December
31, 2016.
Fiscal 2017 Second Quarter Financial
Results & Operational Highlights
Total net revenues for the second quarter of fiscal
2017 were $17.6 million, an increase of 9% from the prior year
period.
- Total license fees were $5.4 million, up significantly from
$0.7 million in the prior year period.
- Total maintenance fees were $3.8 million, an increase of 17%
from $3.3 million in the prior year period.
- Total services revenues were $8.4 million, a decrease of 31%
from $12.2 million in the prior year period.
Gross profit for the second quarter of fiscal 2017
was $8.4 million, or 47.8% of net revenues, an increase of 7% from
$7.9 million, or 48.6% of net revenues, in the second quarter of
fiscal 2016.
GAAP net loss attributable to NETSOL for the second
quarter of fiscal 2017 was $0.99 million, or $(0.09) per diluted
share, compared with net income of $0.88 million, or $0.08 per
diluted share, in the second quarter of fiscal 2016. GAAP net loss
attributable to NETSOL for the second quarter of fiscal 2017
includes $1.4 million of income attributable to non-controlling
interest, compared to $0.88 million in the prior year period. The
year-over-year increase in non-controlling interest was primarily
driven by mix of profits between NETSOL’s wholly owned subsidiaries
and joint ventures. GAAP net loss for the second quarter of fiscal
2017 was also impacted by approximately $0.6 million of loss from
foreign currency exchange transactions.
Adjusted EBITDA1 for the second quarter of
fiscal 2017 was $1.0 million, representing Adjusted EBITDA per
diluted share of $0.09, compared with Adjusted EBITDA of $2.6
million, or Adjusted EBITDA per diluted share of $0.24, in the
second quarter of fiscal 2016.
At December 31, 2016, cash and cash equivalents
were $9.5 million, compared with $11.2 million at September 30,
2016 and $14.0 million at December 31, 2015.
In February 2017, NETSOL completed the
implementation of NFS AscentTM for the Australian finance &
leasing arm of a multinational German Auto Manufacturing
corporation. This was the second implementation under an existing
10-year contract with this customer for the implementation, support
and maintenance of NFS AscentTM in 12 countries.
At the end of the fiscal second quarter, NETSOL’s
global pipeline exceeded $150 million. Pipeline highlights for the
Americas included a leading software company based in the U.S., a
global equipment manufacturer that is an existing NETSOL client in
Asia Pacific, and several other smaller targets currently in
discussions for NFS AscentTM, NFSTM, and LeasePakTM. Pipeline
highlights for Asia Pacific and EMEA included a few large
multi-national clients in discussions for platform upgrades to NFS
AscentTM, multiple potential new logos for NFSTM, and strong
pipeline growth in the emerging Indonesia market.
Management Commentary“Our fiscal
second quarter results are highlighted by strong year-over-year
growth in our license and maintenance revenues driven by new client
implementations and cross-sales into our existing customer base,”
said Najeeb Ghauri, CEO of NETSOL. “Demand remains solid across our
solutions and geographies, our pipeline is growing, and our large
twelve-country NFS Ascent implementation remains on track."
Ghauri continued, “In the past three months, we
have initiated new productivity and cost reduction initiatives that
we expect will drive additional margin expansion and earnings
accretion beginning in the second half of fiscal 2017 and align our
business with our strategy for long-term profitable growth. We
currently expect these initiatives to result in approximately $1.5
million of cost savings in the second half of fiscal 2017, and
approximately $4 million on an annualized basis beginning in fiscal
2018.”
Fiscal 2017 Financial OutlookThe
Company’s financial outlook for the fiscal year ending June 30,
2017 is as follows:
- Total net revenues of $73 to $75 million for fiscal
2017.
- Non-GAAP Adjusted EBITDA, net, of $9 to $10 million for fiscal
2017.
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Fiscal 2017 Second Quarter Conference Call |
|
When: |
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Tuesday,
February 14, 2017 |
|
Time: |
|
|
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|
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9:00
a.m. Eastern Time |
|
Phone: |
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1-844-868-9327 (domestic) |
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1-412-317-6595 (international) |
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Note: |
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Once connected, please
ask to be joined into the NETSOL Technologies call. |
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A replay will be available one hour after the end
of the conference call and can be accessed by dialing
1-877-344-7529 (domestic) or 1-412-317-0088 (international); the
replay access code is 10099519. The replay will be available
through Tuesday, February 21, 2017.
A live webcast will be available online within the
investor relations section of NETSOL’s website at
http://www.netsoltech.com. A replay of the webcast will be
available one hour following conclusion of the live call, and will
be archived for one year.
1 The reconciliation of Adjusted EBITDA to net
income, the most comparable financial measure based upon GAAP, as
well as a further explanation of adjusted EBITDA, is included in
the financial tables in Schedule 4 of this press release. Beginning
with the fourth quarter of fiscal 2016, NetSol has revised its
calculation of Adjusted EBITDA to exclude the portion of Adjusted
EBITDA that is attributable to its subsidiaries that have a
minority interest.
About NETSOL TechnologiesNETSOL
Technologies, Inc. (Nasdaq:NTWK) is a worldwide provider of IT and
enterprise software solutions primarily serving the global Leasing
and Finance industry. The Company’s suite of applications are
backed by 40 years of domain expertise and supported by a committed
team of 1,500+ professionals placed in eight strategically
located support and delivery centers throughout the world. NFSTM,
LeasePakTM, LeaseSoft or NFS AscentTM – help companies transform
their Finance and Leasing operations, providing a fully automated
asset-based finance solution covering the complete leasing and
finance lifecycle.
Investors can receive news releases and invitations
to special events by accessing our online signup form at
http://ir.netsoltech.com/email-alerts.
Forward-Looking Statements
Certain statements in this press release are
forward-looking in nature, including, but not limited to, expected
net revenue and adjusted EPS amounts for the full fiscal year and
the growing market need for NFS Ascent, and accordingly, are
subject to certain risks and uncertainties that could cause actual
results to differ materially from those projected. The words
“expects,” “anticipates,” variations of such words, and similar
expressions, identify forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995, but their
absence does not mean that the statement is not forward-looking.
These statements are not guarantees of future performance and are
subject to certain risks, uncertainties, and assumptions that are
difficult to predict. Factors that could affect the Company's
actual results include the progress and costs of the development of
products and services and the timing of the market acceptance. The
subject Companies expressly disclaim any obligation or undertaking
to update or revise any forward-looking statement contained herein
to reflect any change in the company's expectations with regard
thereto or any change in events, conditions or circumstances upon
which any statement is based.
Investor Contact
ICRWilliam Maina(646)
277-1236investors@netsoltech.com
NETSOL Technologies, Inc. and
Subsidiaries |
Schedule 1: Consolidated Balance
Sheets |
|
|
|
|
As of December 31, |
|
As of June 30, |
|
ASSETS |
|
2016 |
|
|
|
2016 |
|
Current assets: |
|
|
|
|
Cash and
cash equivalents |
$ |
9,505,383 |
|
|
$ |
11,557,527 |
|
|
Accounts
receivable, net of allowance of $495,760 and $492,498 |
|
5,840,490 |
|
|
|
9,691,229 |
|
|
Accounts
receivable, net - related party |
|
4,303,380 |
|
|
|
5,691,178 |
|
|
Revenues in
excess of billings |
|
17,646,488 |
|
|
|
10,493,096 |
|
|
Revenues in
excess of billings - related party |
|
469,030 |
|
|
|
804,168 |
|
|
Other
current assets |
|
2,904,650 |
|
|
|
2,214,628 |
|
|
|
Total current
assets |
|
40,669,421 |
|
|
|
40,451,826 |
|
Restricted
cash |
|
90,000 |
|
|
|
90,000 |
|
Property
and equipment, net |
|
21,873,277 |
|
|
|
22,774,435 |
|
Other
assets |
|
2,054,938 |
|
|
|
842,553 |
|
Intangible
assets, net |
|
18,423,439 |
|
|
|
19,674,033 |
|
Goodwill |
|
9,516,568 |
|
|
|
9,516,568 |
|
|
|
Total
assets |
$ |
92,627,643 |
|
|
$ |
93,349,415 |
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS'
EQUITY |
|
|
|
Current liabilities: |
|
|
|
|
Accounts
payable and accrued expenses |
$ |
7,373,097 |
|
|
$ |
5,962,770 |
|
|
Current
portion of loans and obligations under capitalized leases |
|
4,368,930 |
|
|
|
4,440,084 |
|
|
Unearned
revenues |
|
2,806,804 |
|
|
|
4,739,214 |
|
|
Common
stock to be issued |
|
88,324 |
|
|
|
88,324 |
|
|
|
Total current
liabilities |
|
14,637,155 |
|
|
|
15,230,392 |
|
Long term loans and obligations under capitalized
leases; less current maturities |
|
501,554 |
|
|
|
477,692 |
|
|
|
Total
liabilities |
|
15,138,709 |
|
|
|
15,708,084 |
|
Commitments and contingencies |
|
|
|
Stockholders' equity: |
|
|
|
|
Preferred
stock, $.01 par value; 500,000 shares authorized; |
|
- |
|
|
|
- |
|
|
Common
stock, $.01 par value; 14,500,000 shares authorized; |
|
|
|
|
|
10,993,054 shares issued and 10,958,275 outstanding as
of December 31, 2016 and |
|
|
|
|
10,713,372 shares
issued and 10,686,093 outstanding as of June 30, 2016 |
|
109,931 |
|
|
|
107,134 |
|
|
Additional
paid-in-capital |
|
123,019,215 |
|
|
|
121,448,946 |
|
|
Treasury
stock (34,779 shares and 27,279 shares) |
|
(454,310 |
) |
|
|
(415,425 |
) |
|
Accumulated
deficit |
|
(40,074,755 |
) |
|
|
(37,323,360 |
) |
|
Stock
subscription receivable |
|
(450,220 |
) |
|
|
(783,172 |
) |
|
Other
comprehensive loss |
|
(18,628,395 |
) |
|
|
(18,730,494 |
) |
|
|
Total NetSol
stockholders' equity |
|
63,521,466 |
|
|
|
64,303,629 |
|
|
Non-controlling interest |
|
13,967,468 |
|
|
|
13,337,702 |
|
|
|
Total
stockholders' equity |
|
77,488,934 |
|
|
|
77,641,331 |
|
|
|
Total
liabilities and stockholders' equity |
$ |
92,627,643 |
|
|
$ |
93,349,415 |
|
|
|
|
|
|
|
NETSOL Technologies, Inc. and
Subsidiaries |
Schedule 2: Consolidated Statement of
Operations |
|
|
|
|
For the Three Months |
|
For the Six Months |
|
|
|
|
|
Ended December 31, |
|
Ended December 31, |
|
|
|
|
|
|
2016 |
|
|
|
2015 |
|
|
|
2016 |
|
|
|
2015 |
|
|
|
Net
Revenues: |
|
|
|
|
|
|
|
|
|
|
License
fees |
$ |
5,350,086 |
|
|
$ |
709,691 |
|
|
$ |
8,849,946 |
|
|
$ |
1,903,045 |
|
|
|
|
Maintenance
fees |
|
3,787,696 |
|
|
|
3,240,472 |
|
|
|
7,190,517 |
|
|
|
6,252,710 |
|
|
|
|
Services |
|
6,984,084 |
|
|
|
9,574,104 |
|
|
|
12,790,801 |
|
|
|
16,327,977 |
|
|
|
|
License
fees - related party |
|
- |
|
|
|
- |
|
|
|
246,957 |
|
|
|
- |
|
|
|
|
Maintenance
fees - related party |
|
51,345 |
|
|
|
31,755 |
|
|
|
181,976 |
|
|
|
189,986 |
|
|
|
|
Services -
related party |
|
1,464,901 |
|
|
|
2,635,675 |
|
|
|
3,379,473 |
|
|
|
4,823,083 |
|
|
|
|
|
Total net revenues |
|
17,638,112 |
|
|
|
16,191,697 |
|
|
|
32,639,670 |
|
|
|
29,496,801 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenues: |
|
|
|
|
|
|
|
|
|
|
Salaries
and consultants |
|
5,979,804 |
|
|
|
5,083,412 |
|
|
|
11,873,153 |
|
|
|
10,244,661 |
|
|
|
|
Travel |
|
836,240 |
|
|
|
754,009 |
|
|
|
1,548,135 |
|
|
|
1,235,462 |
|
|
|
|
Depreciation and amortization |
|
1,318,764 |
|
|
|
1,461,466 |
|
|
|
2,649,636 |
|
|
|
2,935,701 |
|
|
|
|
Other |
|
1,065,727 |
|
|
|
1,022,682 |
|
|
|
2,038,065 |
|
|
|
1,961,479 |
|
|
|
|
|
Total cost of
revenues |
|
9,200,535 |
|
|
|
8,321,569 |
|
|
|
18,108,989 |
|
|
|
16,377,303 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit |
|
8,437,577 |
|
|
|
7,870,128 |
|
|
|
14,530,681 |
|
|
|
13,119,498 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
Selling and
marketing |
|
2,713,478 |
|
|
|
2,002,990 |
|
|
|
5,057,516 |
|
|
|
3,701,394 |
|
|
|
|
Depreciation and amortization |
|
271,485 |
|
|
|
285,616 |
|
|
|
540,582 |
|
|
|
576,788 |
|
|
|
|
General and
administrative |
|
3,933,413 |
|
|
|
3,378,829 |
|
|
|
8,552,609 |
|
|
|
6,583,517 |
|
|
|
|
Research
and development cost |
|
91,607 |
|
|
|
117,924 |
|
|
|
184,539 |
|
|
|
229,994 |
|
|
|
|
|
Total operating
expenses |
|
7,009,983 |
|
|
|
5,785,359 |
|
|
|
14,335,246 |
|
|
|
11,091,693 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from operations |
|
1,427,594 |
|
|
|
2,084,769 |
|
|
|
195,435 |
|
|
|
2,027,805 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income and (expenses) |
|
|
|
|
|
|
|
|
|
|
Loss on
sale of assets |
|
(32,339 |
) |
|
|
(2,333 |
) |
|
|
(34,742 |
) |
|
|
(14,206 |
) |
|
|
|
Interest
expense |
|
(62,127 |
) |
|
|
(72,156 |
) |
|
|
(116,602 |
) |
|
|
(140,329 |
) |
|
|
|
Interest
income |
|
23,416 |
|
|
|
35,299 |
|
|
|
53,856 |
|
|
|
87,411 |
|
|
|
|
Loss on
foreign currency exchange transactions |
|
(621,887 |
) |
|
|
(134,527 |
) |
|
|
(1,036,783 |
) |
|
|
(248,246 |
) |
|
|
|
Other
income |
|
6,823 |
|
|
|
120,684 |
|
|
|
28,383 |
|
|
|
174,998 |
|
|
|
|
|
Total other income
(expenses) |
|
(686,114 |
) |
|
|
(53,033 |
) |
|
|
(1,105,888 |
) |
|
|
(140,372 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income (loss) before income
taxes |
|
741,480 |
|
|
|
2,031,736 |
|
|
|
(910,453 |
) |
|
|
1,887,433 |
|
|
|
Income tax provision |
|
(338,884 |
) |
|
|
(273,275 |
) |
|
|
(378,759 |
) |
|
|
(348,498 |
) |
|
|
Net
income (loss) |
|
402,596 |
|
|
|
1,758,461 |
|
|
|
(1,289,212 |
) |
|
|
1,538,935 |
|
|
|
|
Non-controlling interest |
|
(1,388,272 |
) |
|
|
(883,396 |
) |
|
|
(1,462,183 |
) |
|
|
(1,074,898 |
) |
|
|
Net
income (loss) attributable to NetSol |
$ |
(985,676 |
) |
|
$ |
875,065 |
|
|
$ |
(2,751,395 |
) |
|
$ |
464,037 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income (loss) per share: |
|
|
|
|
|
|
|
|
|
|
Net income
(loss) per common share |
|
|
|
|
|
|
|
|
|
|
|
Basic |
$ |
(0.09 |
) |
|
$ |
0.08 |
|
|
$ |
(0.26 |
) |
|
$ |
0.05 |
|
|
|
|
|
Diluted |
$ |
(0.09 |
) |
|
$ |
0.08 |
|
|
$ |
(0.26 |
) |
|
$ |
0.04 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average number of shares outstanding |
|
|
|
|
|
|
|
|
|
|
Basic |
|
10,877,446 |
|
|
|
10,308,186 |
|
|
|
10,783,685 |
|
|
|
10,294,760 |
|
|
|
|
Diluted |
|
10,877,446 |
|
|
|
10,548,922 |
|
|
|
10,783,685 |
|
|
|
10,535,497 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NETSOL Technologies, Inc. and
Subsidiaries |
Schedule 3: Consolidated Statement of Cash
Flows |
|
|
|
|
|
For the Six Months |
|
|
|
|
|
Ended December 31, |
|
|
|
|
|
|
2016 |
|
|
|
2015 |
|
|
Cash flows from operating
activities: |
|
|
|
|
|
Net income (loss) |
$ |
(1,289,212 |
) |
|
$ |
1,538,935 |
|
|
|
Adjustments to reconcile net income (loss) |
|
|
|
|
|
to net cash provided by operating activities: |
|
|
|
|
|
Depreciation and amortization |
|
3,190,218 |
|
|
|
3,512,489 |
|
|
|
Provision for bad debts |
|
1,026 |
|
|
|
37,043 |
|
|
|
Loss on sale of assets |
|
34,742 |
|
|
|
14,206 |
|
|
|
Stock issued for services |
|
1,525,775 |
|
|
|
326,019 |
|
|
|
Fair market value of warrants and stock options granted |
|
21,804 |
|
|
|
145,716 |
|
|
|
Changes in operating assets and
liabilities: |
|
|
|
|
|
Accounts receivable |
|
3,678,110 |
|
|
|
111,967 |
|
|
|
Accounts receivable - related party |
|
829,285 |
|
|
|
(2,383,828 |
) |
|
|
Revenues in excess of billing |
|
(7,219,089 |
) |
|
|
520,071 |
|
|
|
Revenues in excess of billing - related party |
|
285,791 |
|
|
|
15,866 |
|
|
|
Other current assets |
|
585,147 |
|
|
|
(758,802 |
) |
|
|
Accounts payable and accrued expenses |
|
334,241 |
|
|
|
142,008 |
|
|
|
Unearned revenue |
|
(1,908,440 |
) |
|
|
(1,190,072 |
) |
|
|
Net cash provided by operating
activities |
|
69,398 |
|
|
|
2,031,618 |
|
|
|
|
|
|
|
|
|
|
Cash flows from investing
activities: |
|
|
|
|
|
Purchases of property and equipment |
|
(1,074,316 |
) |
|
|
(1,177,443 |
) |
|
|
Sales of property and equipment |
|
181,087 |
|
|
|
357,933 |
|
|
|
Purchase of treasury stock |
|
(38,885 |
) |
|
|
- |
|
|
|
Purchase of non-controlling interest in subsidiary |
|
- |
|
|
|
(347,623 |
) |
|
|
Investment |
|
(705,555 |
) |
|
|
- |
|
|
|
Net cash used in investing
activities |
|
(1,637,669 |
) |
|
|
(1,167,133 |
) |
|
|
|
|
|
|
|
|
|
Cash flows from financing
activities: |
|
|
|
|
|
Proceeds from sale of common stock |
|
- |
|
|
|
64,931 |
|
|
|
Proceeds from the exercise of stock options and warrants |
|
429,452 |
|
|
|
194,680 |
|
|
|
Proceeds
from exercise of subsidiary options |
|
|
|
18,089 |
|
|
|
- |
|
|
|
Dividend paid by subsidiary to Non controlling interest |
|
(968,657 |
) |
|
|
- |
|
|
|
Proceeds from bank loans |
|
- |
|
|
|
306,750 |
|
|
|
Payments on capital lease obligations and loans - net |
|
(69,998 |
) |
|
|
(530,733 |
) |
|
|
Net cash provided by (used in) financing
activities |
|
(591,114 |
) |
|
|
35,628 |
|
|
Effect of exchange rate
changes |
|
107,241 |
|
|
|
(1,082,297 |
) |
|
Net
decrease in cash and cash
equivalents |
|
(2,052,144 |
) |
|
|
(182,184 |
) |
|
Cash and
cash equivalents, beginning of the period |
|
11,557,527 |
|
|
|
14,168,957 |
|
|
Cash and cash equivalents, end of
period |
$ |
9,505,383 |
|
|
$ |
13,986,773 |
|
|
|
|
|
|
|
|
|
|
NETSOL Technologies, Inc. and
Subsidiaries |
Schedule 4: Reconciliation to
GAAP |
|
|
Three Months |
|
Three Months |
|
Six Months |
|
Six Months |
|
|
Ended |
|
Ended |
|
Ended |
|
Ended |
|
|
December 31, 2016 |
|
December 31, 2015 |
|
December 31, 2016 |
|
December 31, 2015 |
|
|
|
|
|
|
|
|
|
|
Net Income (loss)
before preferred dividend, per GAAP |
$ |
(985,676 |
) |
|
$ |
875,065 |
|
|
$ |
(2,751,395 |
) |
|
$ |
464,037 |
|
|
Non-controlling interest |
|
1,388,272 |
|
|
|
883,396 |
|
|
|
1,462,183 |
|
|
|
1,074,898 |
|
|
Income
taxes |
|
338,884 |
|
|
|
273,275 |
|
|
|
378,759 |
|
|
|
348,498 |
|
|
Depreciation and amortization |
|
1,590,249 |
|
|
|
1,747,082 |
|
|
|
3,190,218 |
|
|
|
3,512,489 |
|
|
Interest
expense |
|
62,127 |
|
|
|
72,156 |
|
|
|
116,602 |
|
|
|
140,329 |
|
|
Interest
(income) |
|
(23,416 |
) |
|
|
(35,299 |
) |
|
|
(53,856 |
) |
|
|
(87,411 |
) |
|
EBITDA |
$ |
2,370,440 |
|
|
$ |
3,815,675 |
|
|
$ |
2,342,511 |
|
|
$ |
5,452,840 |
|
|
Add back: |
|
|
|
|
|
|
|
|
Non-cash
stock-based compensation |
|
682,123 |
|
|
|
393,985 |
|
- |
|
1,547,579 |
|
|
|
471,735 |
|
|
Adjusted EBITDA,
gross |
$ |
3,052,563 |
|
|
$ |
4,209,660 |
|
|
$ |
3,890,090 |
|
|
$ |
5,924,575 |
|
|
Less non-controlling
interest (a) |
|
(2,037,286 |
) |
|
|
(1,642,461 |
) |
|
|
(2,717,103 |
) |
|
|
(2,697,992 |
) |
|
Adjusted EBITDA,
net |
$ |
1,015,277 |
|
|
$ |
2,567,199 |
|
|
$ |
1,172,987 |
|
|
$ |
3,226,583 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average number
of shares outstanding |
|
|
|
|
|
|
|
|
Basic |
|
10,877,446 |
|
|
|
10,308,186 |
|
|
|
10,783,685 |
|
|
|
10,294,760 |
|
|
Diluted |
|
11,032,938 |
|
|
|
10,548,922 |
|
|
|
10,939,177 |
|
|
|
10,535,497 |
|
|
|
|
|
|
|
|
|
|
|
Basic adjusted
EBITDA |
$ |
0.09 |
|
|
$ |
0.25 |
|
|
$ |
0.11 |
|
|
$ |
0.31 |
|
|
Diluted adjusted
EBITDA |
$ |
0.09 |
|
|
$ |
0.24 |
|
|
$ |
0.11 |
|
|
$ |
0.31 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)The reconciliation
of adjusted EBITDA of non-controlling interest |
|
|
|
|
|
|
|
|
to net income
attributable to non-controlling interest is as follows |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income attributable
to non-controlling interest |
$ |
1,388,272 |
|
|
$ |
883,396 |
|
|
$ |
1,462,183 |
|
|
$ |
1,074,898 |
|
|
Income
Taxes |
|
53,397 |
|
|
|
23,907 |
|
|
|
61,045 |
|
|
|
37,781 |
|
|
Depreciation and amortization |
|
523,368 |
|
|
|
730,672 |
|
|
|
1,049,294 |
|
|
|
1,556,538 |
|
|
Interest
expense |
|
18,725 |
|
|
|
12,991 |
|
|
|
36,416 |
|
|
|
31,333 |
|
|
Interest
(income) |
|
(7,535 |
) |
|
|
(34,947 |
) |
|
|
(17,092 |
) |
|
|
(51,397 |
) |
|
EBITDA |
$ |
1,976,227 |
|
|
$ |
1,616,019 |
|
|
$ |
2,591,846 |
|
|
$ |
2,649,153 |
|
|
Add back: |
|
|
|
|
|
|
|
|
Non-cash
stock-based compensation |
|
61,059 |
|
|
|
26,442 |
|
|
|
125,257 |
|
|
|
48,839 |
|
|
Adjusted EBITDA of
non-controlling interest |
$ |
2,037,286 |
|
|
$ |
1,642,461 |
|
|
$ |
2,717,103 |
|
|
$ |
2,697,992 |
|
|
|
|
|
|
|
|
|
|
|
From time to time, NETSOL may refer to Adjusted EBITDA (Earnings
Before Interest, Taxes, Depreciation, Amortization and Stock-based
Compensation) and “non-GAAP adjusted EBITDA per diluted share or
Adjusted EBITDA per diluted share” in its conference calls and
discussions with investors and analysts in connection with the
company’s reported historical financial results. Adjusted
EBITDA does not represent cash flows from operations as defined by
generally accepted accounting principles (“GAAP”), is not derived
in accordance with GAAP and should not be considered by the reader
as an alternative to net income (the most comparable GAAP financial
measure to Adjusted EBITDA). Non-GAAP adjusted EBITDA per
diluted share or Adjusted EBITDA per diluted share is not derived
in accordance with GAAP and should not be considered by the reader
as an alternative to reported GAAP diluted EPS. The
reconciliation of GAAP and non-GAAP financial measures for the
three and six month periods ended December 31, 2016 and 2015 are
included in the above table. NETSOL’s management believes
that Adjusted EBITDA and Adjusted EBITDA per diluted share are
helpful as an indicator of the current financial performance of the
company. NETSOL also adjusts for non-cash items, such as
stock-based compensation as we believe excluding these costs
provide a useful metric by which to compare performance from period
to period. Management strongly encourages investors to review the
company’s consolidated financial statements in their entirety and
to not rely on any single financial measure in evaluating the
company.
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