NEW YORK, Aug. 6, 2019 /PRNewswire/ -- Pareteum
Corporation (Nasdaq: TEUM), a rapidly growing cloud
communications platform company, today announced operating and
financial results for the second quarter ended June 30, 2019.
"Pareteum achieved several significant milestones
in the second quarter: We grew revenue 48% from the previous
quarter, delivered EBITDA positive results two full quarters ahead
of analyst expectations and our annualized revenue run rate
eclipsed $136 million," commented
Pareteum's Founder, Chairman & CEO Hal
Turner. "We are in the early innings of a remarkable growth
story. We have added numerous customers to our platform in 2019,
and these customers, as well as those in our deployment pipeline,
will be the drivers of our continued growth. We are only at
the beginning of our mission to connect every person and
every(thing)™."
SECOND-QUARTER 2019 FINANCIAL RESULTS
YEAR-OVER-YEAR:
- Total revenue increased 469% to $34.1
million
- Income from Operations totaled $159,000
- EBITDA increased 466% to $3.4
million
- Adjusted EBITDA increased 369% to $6.1
million
- Non-GAAP EPS of $0.03 (Non-GAAP
EPS of $0.05 for the 6 months ending
June 30, 2019)
- Net Dollar-based expansion rate represented 151% growth
- Increase in total assets from $33.1
million at June 30, 2018 to
$246.9 million at June 30, 2019
|
Sequential
Quarterly Key Metrics
|
|
|
|
|
|
|
|
|
|
|
|
($000's)
|
Q2
2019
|
Q1 2019
|
Q4 2018
|
Q3 2018
|
Q2 2018
|
REVENUE
|
34,148
|
|
23,040
|
|
14,312
|
|
8,008
|
|
6,003
|
|
|
|
|
|
|
|
|
|
|
|
|
YEAR-OVER-YEAR
REVENUE GROWTH
|
28,145
|
469%
|
18,927
|
460%
|
10,297
|
256%
|
4,509
|
129%
|
2,764
|
85%
|
|
|
|
|
|
|
|
|
|
|
|
GROSS
MARGIN
|
18,812
|
55%
|
12,972
|
56%
|
9,085
|
63%
|
5,879
|
73%
|
4,223
|
70%
|
|
|
|
|
|
|
|
|
|
|
|
ADJUSTED
EBITDA
|
6,081
|
|
5,156
|
|
2,339
|
|
1,782
|
|
1,297
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
3,384
|
|
(2,485)
|
|
(3,093)
|
|
(5,851)
|
|
597
|
|
|
|
|
|
|
|
|
|
|
|
|
CONNECTIONS
|
13,030
|
|
12,012
|
|
4,609
|
|
2,903
|
|
2,714
|
|
KEY SECOND-QUARTER OPERATIONAL METRICS:
- Connections increased 380% to 13,030,000 for the second quarter
of 2019, and grew 108.5%sequentially for the first half of
2019
- Second-quarter average annualized revenue per employee of
$583,000, an increase of 55%
year-over-year
RECENT BUSINESS HIGHLIGHTS:
- In June, Pareteum Announced the Commercial Launch of Pareteum
Experience Cloud™. A single source for the creation, delivery and
rapid scaling of a multitude of API-driven communications
experiences, the Pareteum Experience Cloud brings to market an
unrivalled combination of service breadth, management control, and
geographic reach
- In May, Pareteum was announced to join the Russell 3000 Index
at the conclusion of the Russell U.S. Indexes annual
reconstitution
2019 FULL-YEAR GUIDANCE:
We expect revenue to be between $120 million and $130
million for the full year of 2019, an increase from the
previous forecast of between $115
million and $125 million.
Adjusted EBITDA and Cash Flow, net of restructuring and acquisition
costs, will be positive for the year.
We expect 2019 revenue growth in the range of
270% to 301% year-over-year, outpacing the market growth rate by
fivefold, and to be updated quarterly.
CONFERENCE CALL
INFORMATION:
|
|
Date:
|
August 6,
2019
|
Time:
|
4:30 PM
EDT
|
Conference
ID:
|
2627933
|
Domestic Dial-in
Number:
|
1-800-239-9838
|
International Dial-in
Number:
|
1-323-794-2551
|
|
|
Belgium Toll
Free:
|
0800 58228
|
Netherlands Toll
Free:
|
0800 023
1436
|
U.K. Toll
Free:
|
0800 358
6377
|
|
|
Live
webcast:
|
http://public.viavid.com/index.php?id=135110
|
A replay of the call will be available approximately one hour
after the end of the call through May 6,
2020, and can be accessed
at: http://public.viavid.com/index.php?id=135110
About Pareteum Corporation:
Millions of people and devices are connected around the world using
Pareteum's Global Cloud Communications Platform, enhancing their
mobile experience. Pareteum unleashes the power of applications and
mobile services, bringing secure, ubiquitous, scalable, and
seamlessly available voice, video, SMS/text messaging, and data,
media and content enablement to our customers, making worldwide
communications services easily and economically accessible to
everyone. By harnessing the value of our cloud communications
platform, Pareteum serves enterprises, communications service
providers, early stage innovators, developers, IoT, and
telecommunications infrastructure providers Pareteum envisions a
new mobile communications experience imagining what will be, and
delivering now. Pareteum currently has offices in North
America, South America,
Spain, Bahrain, Singapore, India, Indonesia, Germany, Belgium, United
Kingdom, Russia, and
the Netherlands. For more
information please visit: www.pareteum.com.
36-Month Revenue Under Contract Definition:
36-Month Revenue Under Contract (36MRUC), is a Non-GAAP financial
measure. It is measured on a forward-looking 36-month snapshot
view, monthly, and is generated by the Company's Communications
Services Providers, Enterprises, and IoT customers who use
communication as a service platform products and services from the
company's portfolio. The Pareteum multi-year Software-as-a-Service
agreements include service establishment and implementation fees,
guaranteed minimum monthly recurring fees, as well as contractually
scheduled subscribers (connections), in some cases including
subscriber (connections) usage, during the term of the agreement,
and, their resulting monthly recurring contractual revenue. There
can be no assurances that we reach the total revenue under
contract. Timing of revenue recognition may vary from actual
results.
Discussion of Non-GAAP Financial Measures:
Pareteum's
management believes that the non-GAAP measures of (1) "EBITDA" (2)
"Adjusted EBITDA" (3) "Non-GAAP EPS (4) Cash from operating
activities excluding expenditures from restructuring and
acquisitions and (4) Revenue Under Contract enhance an investor's
understanding of Pareteum's financial and operating performance by
presenting (i) a focus on core operating performance and (ii)
comparable financial results over various periods. Pareteum
's management uses these financial measures for strategic
decision making, forecasting future financial results and operating
performance. The presentation of non-GAAP ("Generally Accepted
Accounting Principles") financial information is not intended to be
considered in isolation or as a substitute for, or superior to, the
financial information prepared and presented in accordance with
GAAP.
EBITDA and Adjusted EBITDA Definition:
"EBITDA" is a
non-GAAP measure defined as earnings before interest, taxes,
depreciation and amortization. "Adjusted EBITDA" is a non-GAAP
measure defined by Pareteum as "EBITDA" excluding stock-based
compensation, stock-based compensation taxes, restructuring costs,
acquisition costs, nonrecurring expenditures and certain software
and non-cash adjustments made during the 2016 restructuring that
are not applicable in 2018 and 2019.
Non-GAAP Earnings and EPS Definition:
"Non-GAAP
Earnings and EPS" is a non-GAAP measure defined as earnings per
share excluding stock-based compensation, restructuring and
acquisition costs, amortization of intangible assets and other
nonrecurring expenditures in 2018 and 2019.
Net Dollar-Based Expansion Rate Definition
"Net Dollar-Based Expansion Rate" is measured for a particular
quarter period by first identifying the cohort of customers, or
Base Customers, that were live and in service on the first day of
the given quarter. We then calculate our net dollar expansion rate
by dividing the revenue we recognized for this cohort of customers
in the reporting period to the revenue we recognized for the same
group of customers in the same quarter in the prior year, expressed
as a percentage of the revenue we recognized for the cohort in the
prior year comparative period. A customer will not be considered a
Base Customer unless such customer has been live and in service in
both comparable periods.
Cash from operating activities excluding expenditures from
restructuring and acquisitions:
Cash from operating
activities excluding expenditures from restructuring and
acquisitions is a Non-GAAP measure defined as cash flows from
operating activities as adjusted for adjustments to deferred
revenues, net billings in excess of revenues, restructuring costs
primarily from prior periods and acquisition costs.
Forward Looking Statements:
Certain
statements contained herein constitute "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act
of 1995. Such statements may include, without limitation,
statements with respect to Pareteum's plans and objectives,
projections, expectations and intentions. These forward-looking
statements are based on current expectations, estimates and
projections about Pareteum's industry, management's beliefs and
certain assumptions made by management. Readers are cautioned that
any such forward-looking statements are not guarantees of future
performance and are subject to certain risks, uncertainties and
assumptions that are difficult to predict. Because such statements
involve risks and uncertainties, the actual results and performance
of Pareteum may differ materially from the results expressed or
implied by such forward-looking statements. Given these
uncertainties, readers are cautioned not to place undue reliance on
such forward-looking statements. Unless otherwise required by law,
Pareteum also disclaims any obligation to update its view of any
such risks or uncertainties or to announce publicly the result of
any revisions to the forward-looking statements made here.
Additional information concerning certain risks and uncertainties
that could cause actual results to differ materially from those
projected or suggested in Pareteum's filings with the Securities
and Exchange Commission, copies of which are available from the SEC
or may be obtained upon request from Pareteum Corporation.
Media Inquiries:
Press@pareteum.com
Pareteum Investor Relations Contacts:
Ted O'Donnell
Chief Financial Officer
+1 646 810 2182
InvestorRelations@pareteum.com
Michael Bloom
Investor Relations
+1 650 232 4341
michael.bloom@pareteum.com
Allise Furlani
The Blueshirt Group
allise@blueshirtgroup.com
Carrie Howes
Rayleigh Capital
+1 650 232 4238
carrie@rayleighcapital.com
PARETEUM
CORPORATION AND SUBSIDIARIES
|
UNAUDITED
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
|
(In thousands except
for per share amounts)
|
|
|
Three Month Period
Ended
|
|
Six Month Period
Ended
|
|
June
30,
|
|
June
30,
|
|
June
30,
|
|
June
30,
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
|
|
|
|
|
|
|
REVENUES
|
34,148
|
|
6,003
|
|
57,188
|
|
10,116
|
|
|
|
|
|
|
|
|
COST AND OPERATING
EXPENSES
|
|
|
|
|
|
|
|
Cost of
revenues
|
15,293
|
|
1,780
|
|
25,361
|
|
2,974
|
Product
development
|
3,242
|
|
754
|
|
5,816
|
|
1,481
|
Sales and
marketing
|
2,769
|
|
652
|
|
5,710
|
|
1,341
|
General and
administrative
|
9,034
|
|
2,214
|
|
15,939
|
|
4,511
|
Restructuring and
acquisition costs
|
428
|
|
6
|
|
3,508
|
|
79
|
Depreciation and
amortization
|
3,224
|
|
994
|
|
6,067
|
|
1,960
|
Total cost and
operating expenses
|
33,990
|
|
6,400
|
|
62,402
|
|
12,346
|
|
|
|
|
|
|
|
|
LOSS FROM
OPERATIONS
|
159
|
|
(397)
|
|
(5,214)
|
|
(2,231)
|
|
|
|
|
|
|
|
|
Total other (expense)
/ income
|
(1,124)
|
|
2,072
|
|
(1,740)
|
|
1,771
|
|
|
|
|
|
|
|
|
LOSS BEFORE PROVISION
FOR INCOME TAXES
|
(965)
|
|
1,675
|
|
(6,954)
|
|
(459)
|
Provision for income
taxes
|
(415)
|
|
19
|
|
(617)
|
|
18
|
NET LOSS
|
(550)
|
|
1,656
|
|
(6,337)
|
|
(478)
|
|
|
|
|
|
|
|
|
OTHER COMPREHENSIVE
LOSS / INCOME
|
|
|
|
|
|
|
|
Foreign currency
translation (loss) gain
|
436
|
|
(79)
|
|
76
|
|
25
|
COMPREHENSIVE
LOSS
|
(114)
|
|
1,577
|
|
(6,261)
|
|
(452)
|
|
|
|
|
|
|
|
|
Net income/loss per
common share - basic
|
$
(0.00)
|
|
$
0.03
|
|
$
(0.06)
|
|
$
(0.01)
|
|
|
|
|
|
|
|
|
Weighted average
shares - basic
|
111,074,977
|
|
53,348,376
|
|
107,341,105
|
|
51,714,482
|
|
|
|
|
|
|
|
|
Non-GAAP
Income/(Loss) Per Common Share
|
$
0.03
|
|
$
0.04
|
|
$
0.05
|
|
$
0.03
|
Weighted average
shares basic and diluted common stock equivalents
|
|
|
|
|
|
|
|
125,153,052
|
|
64,741,232
|
|
121,419,180
|
|
51,714,482
|
|
|
|
|
|
|
|
|
Non-GAAP
Reconciliation
|
Three Month Period
Ended
|
|
Six Month Period
Ended
|
|
June
30,
|
|
June
30,
|
|
June
30,
|
|
June
30,
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
|
|
|
|
|
|
|
NET LOSS
|
(550)
|
|
1,656
|
|
(6,337)
|
|
(478)
|
|
|
|
|
|
|
|
|
Total interest and
other income (expense)
|
1,124
|
|
(2,072)
|
|
1,740
|
|
(1,771)
|
Depreciation and
amortization
|
3,224
|
|
994
|
|
6,067
|
|
1,960
|
Provision for income
taxes
|
(415)
|
|
19
|
|
(617)
|
|
18
|
|
|
|
|
|
|
|
|
EBITDA
|
3,384
|
|
598
|
|
855
|
|
(271)
|
|
|
|
|
|
|
|
|
Restructuring and
acquisition costs
|
428
|
|
6
|
|
3,508
|
|
79
|
Stock based
compensation
|
2,009
|
|
694
|
|
5,722
|
|
1,772
|
Stock based
tax
|
261
|
|
|
|
990
|
|
0
|
Adjusted
EBITDA
|
6,081
|
|
1,298
|
|
11,075
|
|
1,580
|
|
|
|
|
|
|
|
|
Non-GAAP
Reconciliation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET LOSS
|
(550)
|
|
1,656
|
|
(6,337)
|
|
(478)
|
|
|
|
|
|
|
|
|
Restructuring and
acquisition costs
|
428
|
|
6
|
|
3,508
|
|
79
|
Stock based
compensation
|
2,009
|
|
694
|
|
5,722
|
|
1,772
|
Amortization of
Intangibles
|
2,018
|
|
0
|
|
3,685
|
|
0
|
NON-GAAP NET
INCOME/(LOSS)
|
3,905
|
|
2,356
|
|
6,578
|
|
1,373
|
PARETEUM CORPORATION
AND SUBSIDIARIES
|
UNAUDITED CONDENSED
CONSOLIDATED BALANCE SHEET INFORMATION
|
(In
thousands)
|
|
|
|
|
|
|
|
June
30,
|
|
December
31,
|
|
|
2019
|
|
2018
|
|
|
|
|
|
Cash and cash
equivalents
|
|
3,378
|
|
6,052
|
Restricted
cash
|
|
1,105
|
|
431
|
Accounts
receivable
|
|
45,061
|
|
15,362
|
Notes
Receivable
|
|
1,024
|
|
-
|
Prepaid expenses and
other current assets
|
3,386
|
|
2,084
|
Total current
assets
|
|
53,953
|
|
23,928
|
|
|
|
|
|
Intangible
Assets
|
|
60,262
|
|
39,658
|
Goodwill
|
|
121,487
|
|
91,774
|
Lease Right of Use
Assets
|
|
2,493
|
|
-
|
Other non-current
assets
|
|
8,673
|
|
5,681
|
|
|
|
|
|
Total
assets
|
|
246,868
|
|
161,041
|
|
|
|
|
|
Total current
liabilities
|
|
44,265
|
|
20,006
|
Total non-current
liabilities
|
|
32,987
|
|
8,971
|
Total
liabilities
|
|
77,252
|
|
28,977
|
|
|
|
|
|
Total
stockholders' equity
|
|
169,616
|
|
132,065
|
|
|
|
|
|
Total liabilities
and stockholders' equity
|
246,868
|
|
161,041
|
|
|
|
|
|
PARETEUM CORPORATION
AND SUBSIDIARIES
|
UNAUDITED CONDENSED
CONSOLIDATED CASH FLOW INFORMATION
|
(In
thousands)
|
|
|
For the Three
Months Ended
|
|
|
June
30,
|
|
March
31,
|
|
|
2019
|
|
2018
|
|
|
|
|
|
CASH FLOWS FROM
OPERATING ACTIVITIES:
|
(10,169)
|
|
(952)
|
CASH FLOWS FROM
INVESTING ACTIVITIES:
|
(6,466)
|
|
(1,877)
|
CASH FLOWS FROM
FINANCING ACTIVITIES:
|
14,443
|
|
8,484
|
EFFECT OF EXCHANGE
RATES
|
192
|
|
42
|
NET INCREASE
(DECREASE) IN CASH & CASH EQUIVALENTS
|
(2,000)
|
|
5,697
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP OPERATING
CASH FLOWS RECONCILIATION
|
|
|
|
|
|
CASH FLOWS FROM
OPERATING ACTIVITIES:
|
(10,169)
|
|
(952)
|
|
|
|
|
|
|
|
|
|
|
Increase (decrease)
in Net billings in excess of revenues
|
|
2,000
|
|
23
|
Increase (decrease)
in accrued expenses and other payables
|
|
6,484
|
|
(1,188)
|
|
|
|
|
|
CASH FLOWS FROM
OPERATING ACTIVITIES EXCLUDING
|
|
|
|
EXPENDITURES FOR
RESTRUCTURING AND ACQUISITIONS
|
|
(1,685)
|
|
(2,117)
|
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SOURCE Pareteum Corporation