Inuvo Reports Financial Results for the Three Month Period Ending September 30, 2017; Revenue Increased 16.2% for the Third Q...
November 01 2017 - 4:01PM
Inuvo, Inc. (NYSE MKT:INUV), an advertising
technology company, today reported its financial results for the
third quarter ended September 30, 2017. Revenue for the third
quarter totaled $20.3 million, an increase year-over-year of 16.2%.
“The business is performing very well leading into the last
quarter. We are pleased with our year-over-year revenue growth of
16.2% and the sequential quarterly growth of 11.2% while having
maintained a positive adjusted EBITDA. The monthly revenue of the
business we acquired has doubled since February and the
concentration of revenue within our 2 largest partners has been
reduced from 98.6% of total revenue to 71% year-over-year,” stated
Rich Howe, Chairman and CEO of Inuvo. “Lastly, as part of our share
repurchase program authorized by our Board of Directors, we
repurchased 45,900 shares of our common stock in the quarter at an
average price of $0.97 per share.”
Third Quarter 2017 Financial Highlights
- Revenue increased 16.2% to $20.3 million as compared to $17.5
million for the same period the prior year.
- Operating expenses were improved by 9.8%, from $12.8 to $11.6
million year-over-year.
- The concentration risk associated with 2 large partners was
reduced by 27.6% year-over-year.
- Adjusted EBITDA totaled $253,000 as compared to $420,000 last
year.
- GAAP net loss from continuing operations was $0.03 per share
compared to $0.02 net loss per share last year.
- Non-cash operating expenses were $0.04 per share totaling $1.1
million in the quarter.
- Cash balance at September 30, 2017 was $2.9 million.
- 45,900 shares of common stock were repurchased at an average
price of $0.97.
Conference Call Information: Date: Wednesday,
November 1, 2017Time: 4:15 p.m. ET Domestic Dial-in Number:
1-888-224-1065 International Dial-in Number: 1-719-325-4755 Live
Webcast: http://public.viavid.com/player/index.php?id=126865
A telephone replay will be available through November 15, 2017.
To access the replay, please dial 1-844-512-2921 (domestic) or
1-412-317-6671 (international). At the system prompt, enter the
code 6373515 followed by the # sign. You will then be prompted for
your name, company and phone number. Playback will then
automatically begin.
About Inuvo, Inc. Inuvo®, Inc. (NYSE
MKT:INUV) is an advertising technology business. The Inuvo
MarketPlace is a set of technologies designed to connect
advertisers (demand) with consumer audiences through publishers
(supply) across device types. Inuvo has the ability to serve ads
within content, video and images. To learn more about Inuvo, please
visit www.inuvo.com or download our app for Apple
iPhone or for Android.
Forward-looking Statements This press
release contains certain forward-looking statements that are based
upon current expectations and involve certain risks and
uncertainties within the meaning of the U.S. Private Securities
Litigation Reform Act of 1995. Words or expressions such as
"anticipate," "plan," "will," "intend," "believe" or "expect" or
variations of such words and similar expressions are intended to
identify such forward-looking statements. These forward-looking
statements are not guarantees of future performance and are subject
to risks, uncertainties, and other factors, some of which are
beyond our control and difficult to predict and could cause actual
results to differ materially from those expressed or forecasted in
the forward-looking statements, including, without limitation,
statements made with respect to expectations with respect to our
lack of profitable operating history, successful integration of the
NetSeer business, changes in our business, potential need for
additional capital, fluctuations in demand; changes to economic
growth in the U.S. economy; and government policies and
regulations, including, but not limited to those affecting the
Internet, all as set forth in our Annual Report on Form 10-K for
the year ended December 31, 2016. All forward-looking statements
involve significant risks and uncertainties that could cause actual
results to differ materially from those in the forward-looking
statements, many of which are generally outside the control of
Inuvo and are difficult to predict. Inuvo undertakes no obligation
to publicly update any forward-looking statements, whether as a
result of new information, future events or otherwise.
INUVO, INC. |
CONDENSED CONSOLIDATED BALANCE
SHEETS |
|
|
|
|
|
|
|
(Unaudited) |
|
|
|
|
September 30, |
|
December 31, |
|
|
2017 |
|
2016 |
Assets |
|
|
|
|
Current assets |
|
|
|
|
Cash |
|
$2,901,965 |
|
$3,946,804 |
Accounts receivable,
net |
|
9,976,903 |
|
7,586,129 |
Prepaid expenses and
other current assets |
|
347,707 |
|
293,113 |
Total current
assets |
|
13,226,575 |
|
11,826,046 |
|
|
|
|
|
Property and equipment,
net |
|
2,233,183 |
|
1,615,223 |
Other assets |
|
|
|
|
Goodwill |
|
9,773,842 |
|
5,760,808 |
Intangible assets,
net |
|
11,319,044 |
|
8,343,876 |
Other assets |
|
96,070 |
|
15,186 |
Total other assets |
|
21,188,956 |
|
14,119,870 |
Total assets |
|
$36,648,714 |
|
$27,561,139 |
|
|
|
|
|
Liabilities and
Stockholders’ Equity |
|
|
|
|
Current
liabilities |
|
|
|
|
Accounts payable |
|
11,761,983 |
|
9,280,779 |
Accrued expenses and
other current liabilities |
|
2,936,116 |
|
2,689,640 |
Revolving credit
line-current portion |
|
5,000,000 |
|
- |
Total current
liabilities |
|
19,698,099 |
|
11,970,419 |
|
|
|
|
|
Long-term
liabilities |
|
|
|
|
|
|
|
|
|
Deferred tax
liability |
|
3,738,500 |
|
3,738,500 |
Other long-term
liabilities |
|
485,405 |
|
326,428 |
Total long-term
liabilities |
|
4,223,905 |
|
4,064,928 |
|
|
|
|
|
Total stockholders'
equity |
|
12,726,710 |
|
11,525,792 |
Total liabilities and
stockholders' equity |
|
$36,648,714 |
|
$27,561,139 |
INUVO, INC.CONSOLIDATED
STATEMENTS OF OPERATIONS(Unaudited) |
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, |
|
September 30, |
|
September 30, |
|
September 30, |
|
|
2017 |
|
|
2016 |
|
|
2017 |
|
|
2016 |
|
Net revenue |
|
$20,311,502 |
|
|
$17,485,087 |
|
|
$55,798,545 |
|
|
$51,864,448 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue |
|
9,649,295 |
|
|
5,136,242 |
|
|
25,161,761 |
|
|
13,392,598 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit |
|
10,662,207 |
|
|
12,348,845 |
|
|
30,636,784 |
|
|
38,471,850 |
|
Operating expenses |
|
|
|
|
|
|
|
|
Marketing costs |
|
7,161,905 |
|
|
9,921,395 |
|
|
21,122,489 |
|
|
30,395,472 |
|
Compensation |
|
2,363,901 |
|
|
1,650,474 |
|
|
7,053,308 |
|
|
4,973,192 |
|
Selling, general and
administrative |
|
2,025,254 |
|
|
1,229,177 |
|
|
6,308,552 |
|
|
3,759,225 |
|
Total operating
expenses |
|
11,551,060 |
|
|
12,801,046 |
|
|
34,484,349 |
|
|
39,127,889 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating loss |
|
(888,853) |
|
|
(452,201) |
|
|
(3,847,565) |
|
|
(656,039) |
|
|
Interest expense,
net |
|
(97,318) |
|
|
(25,729) |
|
|
(212,922) |
|
|
(71,784) |
|
Loss from continuing
operations before taxes |
|
(986,171) |
|
|
(477,930) |
|
|
(4,060,487) |
|
|
(727,823) |
|
|
Income tax benefit |
|
- |
|
|
43,013 |
|
|
- |
|
|
91,999 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss from
continuing operations |
|
(986,171) |
|
|
(434,917) |
|
|
(4,060,487) |
|
|
(635,824) |
|
Net income (loss) from
discontinued operations |
|
- |
|
|
171,844 |
|
|
(1,109) |
|
|
172,197 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss |
|
(986,171) |
|
|
(263,073) |
|
|
(4,061,596) |
|
|
(463,627) |
|
Earnings per share,
basic and diluted |
|
|
|
|
|
|
|
|
From continuing
operations |
|
($0.03) |
|
|
($0.02) |
|
|
($0.14) |
|
|
($0.03) |
|
From discontinued
operations |
|
- |
|
|
0.01 |
|
|
- |
|
|
0.01 |
|
Net loss |
|
($0.03) |
|
|
($0.01) |
|
|
($0.14) |
|
|
($0.02) |
|
Weighted average shares
outstanding |
|
|
|
|
|
|
|
|
Basic |
|
28,553,055 |
|
|
24,694,566 |
|
|
28,030,902 |
|
|
24,571,271 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted |
|
28,553,055 |
|
|
24,694,566 |
|
|
28,030,902 |
|
|
24,571,271 |
|
|
|
|
|
|
|
|
|
|
RECONCILIATION OF LOSS FROM CONTINUING
OPERATIONS BEFORE TAXES TO ADJUSTED EBITDA |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, |
|
September 30, |
|
September 30, |
|
September 30, |
|
|
2017 |
|
|
2016 |
|
|
2017 |
|
|
2016 |
|
Loss from continuing
operations before taxes |
|
($986,172) |
|
|
($477,930) |
|
|
($4,060,487) |
|
|
($727,823) |
|
Interest expense,
net |
|
97,318 |
|
|
25,729 |
|
|
212,922 |
|
|
71,784 |
|
Depreciation |
|
406,014 |
|
|
325,236 |
|
|
1,077,143 |
|
|
958,704 |
|
Amortization |
|
398,616 |
|
|
231,060 |
|
|
1,162,354 |
|
|
699,648 |
|
Stock-based
compensation |
|
336,913 |
|
|
315,596 |
|
|
923,072 |
|
|
1,002,044 |
|
Non-recurring expense
associated with acquiring NetSeer |
|
- |
|
|
- |
|
|
996,467 |
|
|
- |
|
Adjusted EBITDA |
|
$252,689 |
|
|
$419,691 |
|
|
$311,471 |
|
|
$2,004,357 |
|
Reconciliation of Loss from Continuing Operations before
Taxes to Adjusted EBITDA
We present Adjusted EBITDA as a supplemental measure of our
performance. We defined Adjusted EBITDA as net loss from continuing
operations before taxes plus (i) interest expense, net, (ii)
depreciation, (iii) amortization, (iv) stock-based compensation and
(v) certain identified expenses that are not expected to recur or
be representative of future ongoing operation of the business.
These further adjustments are itemized above. You are encouraged to
evaluate these adjustments and the reasons we consider them
appropriate for supplemental analysis. In evaluating Adjusted
EBITDA, you should be aware that in the future we may incur
expenses that are the same or similar to some of the adjustments in
the presentation. Our presentation of Adjusted EBITDA should not be
construed as an inference that our future results will be
unaffected by unusual or non-recurring items.
Company Contact:Inuvo, Inc. Wally Ruiz
Chief Financial Officer 501-205-8397 wallace.ruiz@inuvo.com
Investor Contact:KCSA Strategic Communications
Valter Pinto, Senior Vice President 212-896-1254
valter@kcsa.com
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