Inuvo Reports Financial Results for the Fourth Quarter and Full Year Ending December 31, 2017
February 07 2018 - 4:01PM
Inuvo, Inc. (NYSE:INUV), an advertising technology
company, today reported its financial results for the fourth
quarter and full year period ending December 31, 2017. Revenue for
the 2017 fourth quarter and full year increased 21% year-over-year
to $23.8 million and 11% year-over-year to $79.6 million,
respectively.
“At 17% CAGR (compound annual growth rate) since 2014, the
strong 2017 fourth quarter and full year financial results
demonstrate Inuvo’s ability to thrive in a competitive market.
Within the year, we added new sales resources, technology,
associates, partners, clients and an office in California,”
commented Rich Howe, Chairman and CEO of Inuvo. “We also just
completed our best January in history and as a result are poised
for a strong 2018. Machine learning in advertising is not
aspirational for Inuvo, we are doing it billions of times every
day.”
2017 Fourth Quarter and Full Year Financial
Highlights:
- Fourth quarter revenue increased 21% to $23.8 million
year-over-year.
- 2017 full year revenue increased 11% to $79.6 million
year-over-year.
- Fourth quarter adjusted EBITDA totaled approximately
$758,000.
- 2017 full year adjusted EBITDA totaled approximately $1.1
million.
- Fourth quarter net income totaled approximately $1
million.
- 2017 full year net loss totaled approximately $3.1
million.
- In 2017, non-cash depreciation, amortization and stock-based
compensation totaled approximately $4.3 million,
- In 2017, one-time expenses from the February 2017 acquisition
totaled approximately $1 million.
- Fourth quarter included a favorable $1.5 million tax
adjustment.
- Cash balance as of December 31, 2017 was approximately $4.1
million.
- In 2017, 45,900 shares of common stock were repurchased at an
average price of $0.98 per share.
2017 Operational Highlights:
- Full-time headcount at Inuvo totals 80, which yielded $1
million in revenue per employee in 2017.
- Monthly revenue from the February 2017 acquisition grew 125% to
$1.9 million in December 2017.
- Revenue concentration improved, with over 23% of 2017 revenues
from new sources.
- Invested in new sales and account management organization led
by a seasoned Chief Revenue Officer.
- Mobile revenue increased from 52% in 2016 to over 62% in
2017.
- Developed relationships in China that could yield demand for
services in 2018.
January Highlights:Preliminary unaudited
revenue in January 2018 was approximately $7.7 million, an increase
of 37% year-over-year. The Company does not anticipate
continuing to report preliminary unaudited monthly revenue and will
provide additional financial information when Q1 2018 financial
results are available.
Revenue Guidance:The Company expects to deliver
double digit revenue growth in 2018. The Company's revenue
expectation represents management's view as of February 7, 2018 and
such expectation should not be assumed to be current as of any
future date.
Conference Call Information: Date: Wednesday,
February 7, 2018 Time: 4:15 p.m. ET Domestic Dial-in number:
1-800-289-0438 International Dial-in number: 1-323-794-2423 Live
webcast: http://public.viavid.com/player/index.php?id=128154
A telephone replay will be available through February 21, 2018.
To access the replay, please dial 1-844-512-2921 (domestic) or
1-412-317-6671 (international). At the system prompt, enter the
code 1207045 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: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 can 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 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, 2017. 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 |
|
|
|
December 31, |
|
December 31, |
|
|
2017 |
|
2016 |
Assets |
|
|
|
|
Current assets |
|
|
|
|
Cash |
|
$4,084,686 |
|
$3,946,804 |
Accounts receivable,
net |
|
10,759,250 |
|
7,586,129 |
Prepaid expenses and
other current assets |
|
400,191 |
|
293,113 |
Total current
assets |
|
15,244,127 |
|
11,826,046 |
|
|
|
|
|
Property and equipment,
net |
|
2,306,279 |
|
1,615,223 |
Other assets |
|
|
|
|
Goodwill |
|
9,853,342 |
|
5,760,808 |
Intangible assets,
net |
|
10,808,018 |
|
8,343,876 |
Other assets |
|
36,070 |
|
15,186 |
Total other assets |
|
20,697,430 |
|
14,119,870 |
Total assets |
|
$38,247,836 |
|
$27,561,139 |
|
|
|
|
|
Liabilities and
Stockholders’ Equity |
|
|
|
|
Current
liabilities |
|
|
|
|
Accounts payable |
|
$13,614,053 |
|
$9,280,779 |
Revolving credit
line-current portion |
|
4,900,000 |
|
- |
Accrued expenses and
other current liabilities |
|
2,887,816 |
|
2,689,640 |
Total current
liabilities |
|
21,401,869 |
|
11,970,419 |
Long-term
liabilities |
|
|
|
|
Deferred tax
liability |
|
2,331,900 |
|
3,738,500 |
Other long-term
liabilities |
|
426,725 |
|
326,428 |
Total long-term
liabilities |
|
2,758,625 |
|
4,064,928 |
|
|
|
|
|
Total stockholders'
equity |
|
14,087,342 |
|
11,525,792 |
Total liabilities and
stockholders' equity |
|
$38,247,836 |
|
$27,561,139 |
|
|
|
|
|
|
INUVO, INC. |
CONSOLIDATED STATEMENTS OF
OPERATIONS |
|
|
|
Three Months Ended |
|
Twelve Months Ended |
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
|
2017 |
|
2016 |
|
2017 |
|
2016 |
Net revenue |
|
$23,755,948 |
|
$19,665,654 |
|
$79,554,493 |
|
$71,530,102 |
|
|
|
|
|
|
|
|
|
Cost of revenue |
|
11,507,782 |
|
7,972,197 |
|
36,669,543 |
|
21,364,795 |
|
|
|
|
|
|
|
|
|
Gross profit |
|
12,248,166 |
|
11,693,457 |
|
42,884,950 |
|
50,165,307 |
Operating expenses |
|
|
|
|
|
|
Marketing costs |
|
7,455,912 |
|
8,800,181 |
|
28,578,401 |
|
39,195,653 |
Compensation |
|
3,146,809 |
|
1,857,146 |
|
10,200,117 |
|
6,830,338 |
Selling, general and administrative |
|
2,034,354 |
|
1,237,257 |
|
8,342,906 |
|
4,996,482 |
Total operating expenses |
|
12,637,075 |
|
11,894,584 |
|
47,121,424 |
|
51,022,473 |
|
|
|
|
|
|
|
|
|
Operating loss |
|
(388,909) |
|
(201,127) |
|
(4,236,474) |
|
(857,166) |
|
|
|
|
|
|
|
|
|
Interest expense, net |
|
(105,271) |
|
(28,181) |
|
(318,193) |
|
(99,965) |
Loss from continuing operationsbefore taxes |
|
(494,180) |
|
(229,308) |
|
(4,554,667) |
|
(957,131) |
|
|
|
|
|
|
|
|
|
Income tax benefit (loss) |
|
1,498,076 |
|
(62,739) |
|
1,498,076 |
|
29,260 |
Net income (loss) from continuingoperations |
|
1,003,896 |
|
(292,047) |
|
(3,056,591) |
|
(927,871) |
Net income (loss) from discontinuedoperations |
|
- |
|
(16,910) |
|
(1,109) |
|
155,287 |
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
1,003,896 |
|
(308,957) |
|
(3,057,700) |
|
(772,584) |
Earnings
per share, basic and diluted |
|
|
|
|
|
|
|
|
From continuing operations |
|
$0.04 |
|
($0.01) |
|
($0.11) |
|
($0.04) |
From discontinued operations |
|
- |
|
- |
|
- |
|
0.01 |
Net income (loss) |
|
$0.04 |
|
($0.01) |
|
($0.11) |
|
($0.03) |
Weighted
average shares outstanding |
|
|
|
|
|
|
|
|
Basic |
|
28,622,994 |
|
24,928,247 |
|
28,155,320 |
|
24,660,995 |
Diluted |
|
28,701,884 |
|
24,928,247 |
|
28,155,320 |
|
24,660,995 |
|
|
|
|
|
|
|
|
|
|
RECONCILIATION OF LOSS FROM CONTINUING
OPERATIONS BEFORE TAXES TO ADJUSTED EBITDA |
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
Year Ended |
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
|
2017 |
|
2016 |
|
2017 |
|
2016 |
Loss from continuing
operations before taxes |
|
($494,180) |
|
($229,308) |
|
($4,554,667) |
|
(957,131) |
Interest expense,
net |
|
105,271 |
|
28,181 |
|
318,193 |
|
99,965 |
Depreciation |
|
426,306 |
|
320,326 |
|
1,503,449 |
|
1,279,030 |
Amortization |
|
363,998 |
|
231,060 |
|
1,526,352 |
|
930,708 |
Stock-based
compensation |
|
356,735 |
|
262,222 |
|
1,279,807 |
|
1,264,266 |
Non-recurring expense
associated with acquiring NetSeer |
|
- |
|
- |
|
996,467 |
|
- |
Adjusted EBITDA |
|
$758,130 |
|
$612,481 |
|
$1,069,601 |
|
$2,616,838 |
|
|
|
|
|
|
|
|
|
Reconciliation of Loss from Continuing Operations before
Taxes to Adjusted EBITDAWe 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, Managing Director 212-896-1254 valter@kcsa.com
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