PFSweb Reports New Client Developments
November 07 2008 - 4:30PM
Business Wire
PFSweb, Inc. (Nasdaq: PFSW), an international business process
outsourcing provider of end-to-end web commerce solutions and an
online discount retailer, today announced five new Service Fee
client engagements and the non-renewal of one large Service Fee
client contract for fiscal 2009. The Company also reiterated its
previous Adjusted EBITDA and non-GAAP net income guidance for
fiscal year 2008. Four of the five new client wins are directly
attributable to PFSweb�s end-to-end eCommerce initiative launched
earlier this year. These four end-to-end eCommerce engagements each
involve widely recognized luxury or fashion apparel brands within a
single global portfolio of premium brands. Under a master
agreement, PFSweb is leveraging its eCommerce technology and
interactive marketing services as well as order fulfillment,
warehousing, and logistics services to provide a comprehensive
end-to-end eCommerce solution to support each of the four brands.
As part of its end-to-end eCommerce solution, PFSweb utilizes the
DemandWare eCommerce platform to create advanced front-end web
storefronts that empower each brand�s marketers with the tools to
drive continual innovation and growth. PFSweb is also providing
custom-tailored, high-touch fashion and apparel customer care
services for each brand. Implementation of these brands� programs
is currently expected to be completed throughout the 2009 calendar
year, with the first site expected to launch in the first quarter
of 2009. Under the master agreement, additional brands within the
portfolio may be added as additional client engagements in the
future. PFSweb has also been selected by a large footwear retailer
with global operations to provide a seamless customer service
solution that supports its multi-channel business operations. Under
the agreement, PFSweb will provide customer contact services from
its Plano, Texas and Memphis, Tennessee facilities. PFSweb will
fully integrate and interface with the client�s systems to provide
a seamless brand representation and customer service solution. Mike
Willoughby, President of PFSweb�s services division, stated, �These
five new engagements represent a significant expansion of our
growing portfolio of image and luxury fashion and apparel brands,
and we are excited to be partnering with each of these prestigious
brands. With more than 15 years experience supporting some of the
world�s best known brands, and with offices in the U.S., Canada,
Europe and Asia, our clients are partnering with one of the most
experienced eCommerce services companies in the world. In light of
the current economic uncertainty, we are pleased with our continued
growth in new business as well as the strong prospective sales
pipeline we maintain, which we believe is a result of continued
strong demand for global eCommerce solutions.� After considering
the five new client wins, PFSweb is reporting a current pipeline
for potential new business that is in excess of $30 million
including a contract currently being finalized. This new business
pipeline value is in line with the Company�s expectations for this
time of year and is still targeted to increase through the
remainder of the calendar year. PFSweb also announced today the
non-renewal, effective early in 2009, of a large client engagement
with an agency of the U.S. government. Mr. Willoughby commented,
�The non-renewal of this client is clearly disappointing and it
will impact our growth outlook for 2009. Nevertheless, our business
is designed with flexibility in mind and we are targeting to
redeploy certain technology and equipment infrastructure to other
clients and reduce variable expenses directly attributable to this
client.� Fiscal Year 2008 Guidance PFSweb now targets total
consolidated revenues for 2008 excluding pass-through revenues, of
approximately $425 million to $440 million as compared to the range
of approximately $445 million to $475 million previously
communicated. The change in revenue guidance is a result of lower
Q4 forecasts recently received from numerous clients and attributed
to slowing consumer demand as a result of the weakening worldwide
economic conditions. However, the Company is maintaining its
Adjusted EBITDA and non-GAAP-net income guidance for 2008 as it
expects to include a larger percentage of higher margin project
activities in Q4 2008 than previously forecast and it has
instituted additional cost control measures in the businesses.
PFSweb continues to target consolidated Adjusted EBITDA of $10 �
$12 million and non-GAAP net income, which excludes the impact of
stock-based compensation and amortization of identifiable
intangible assets, of approximately $1 - $3 million for 2008. As
previously noted, further weakening in worldwide economic
conditions may cause the Company to fall toward the lower end of
these targets. About PFSweb, Inc. PFSweb develops and deploys
integrated business infrastructure solutions and fulfillment
services for Fortune 1000, Global 2000 and brand name companies,
including third party logistics, call center support and e-commerce
services. The company serves a multitude of industries and company
types, including such clients as LEGO, Discovery Commerce,
Riverbed, Hewlett-Packard, International Business Machines, Hawker
Beechcraft Corp., Rene Furterer USA, Roots Canada Ltd. and Xerox.
Through its wholly owned eCOST.com subsidiary, PFSweb also serves
as a leading multi-category online discount retailer of
high-quality new, "close-out" and manufacturer recertified
brand-name merchandise for consumers and small to medium size
business buyers. The eCOST.com brand markets approximately 170,000
different products from leading manufacturers such as Sony, JVC,
Canon, Hewlett-Packard, Garmin, Panasonic, Toshiba, Microsoft,
Kitchen Aid, Panasonic, Black & Decker, Cuisinart, Coleman,
Wilson and Nike primarily over the Internet and through direct
marketing. To find out more about PFSweb, Inc. (NASDAQ: PFSW),
visit the company's websites at http://www.pfsweb.com and
http://www.ecost.com. The matters discussed herein include
forward-looking information under the Private Securities Litigation
Reform Act of 1995, which 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, 2007 and Form
10-Q for the quarter ended June 30, 2008 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 and the Risk
Factors described therein. These Risk Factors include the risk of
contract terminations. 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.
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