Acquisition extends company’s leadership in
retail analytics solutions and expands the SPS retail network
SPS Commerce, Inc. (Nasdaq:SPSC), a leading provider of cloud-based
supply chain management solutions for the retail industry, today
announced the acquisition of ToolBox Solutions, a leading provider
of point-of-sale analytics and category management services to
retailers and consumer packaged goods suppliers in North America.
The acquisition expands the SPS Commerce retail network, building
on its current network of more than 60,000 organizations in 60
countries, and strengthens its analytics offerings.
ToolBox Solutions has established relationships with many
leading retailers and CPG suppliers in the convenience, grocery and
drug store segments. ToolBox Solutions employees will continue to
be based in Toronto.
“We are pleased to welcome ToolBox Solutions’ employees
and customers to SPS Commerce,” said Archie Black, CEO of SPS
Commerce. “In the omnichannel era, retailers and suppliers need
rich insights into consumers’ purchase behavior, both in store and
online. Enabling collaboration and visibility between trading
partners around consumer demand trends and inventory is essential
in order to drive growth. With the acquisition of ToolBox
Solutions, we expand our expertise in point-of-sale analytics for
both retailers and suppliers. We’re excited to incorporate ToolBox
Solutions’ success into SPS Commerce’s global network.”
As part of the industry’s broadest retail network, ToolBox
Solutions’ customers will be able to take advantage of a powerful
suite of solutions that allow them to easily and efficiently
integrate and collaborate with their trading partners.
“ToolBox Solutions is thrilled to join the SPS Commerce retail
network,” said Gerald Vandenberg, Executive Vice President at
ToolBox Solutions. “We’re excited to join forces with SPS to help
enhance their market-leading analytics solutions. Through
this acquisition, our customers will gain access to a broad suite
of cloud-based supply chain solutions to connect with their trading
partners around the globe.”
Acquisition Details
Under the terms of the acquisition agreement, SPS Commerce
acquired all of the shares of ToolBox Solutions for approximately
$18.4 million in cash and $4.5 million in stock which represents
approximately 65,000 shares. This amount includes $1.1 million of
stock that is subject to an earn-out and has not yet been
issued. ToolBox Solutions is headquartered in Toronto.
For the first quarter of 2016, SPS Commerce anticipates the
acquisition will add approximately $1.45 million of revenue and
expects Adjusted EBITDA to be negatively impacted by approximately
$300,000. For the first quarter, the company expects
approximately $350,000 of amortization expense associated with the
acquisition.
For fiscal 2016, the Company expects the acquisition will add
approximately $6 million of revenue. The Company also anticipates
the acquisition to negatively impact Adjusted EBITDA by
approximately $800,000 and expects the acquisition to be accretive
to Adjusted EBITDA starting in the first quarter of 2017. For the
full year 2016, the Company expects approximately $1.4 million of
amortization expense associated with the acquisition.
The Company will provide consolidated 2016 guidance in its
fourth quarter and full year 2015 financial results press release
anticipated to be issued on February 3, 2016.
Conference Call Information
SPS Commerce will host a conference call today at 7:30 a.m.
Central Time (8:30 a.m. Eastern Time). To access the call, please
dial (877) 312-7508, or outside the U.S. (253) 237-1184, with
Conference ID# 20164667 at least five minutes prior to the 7:30
a.m. CT start time. A live webcast of the call will also be
available at investors.spscommerce.com under the Events and
Presentations menu. The replay will also be available on our
website at investors.spscommerce.com.
About SPS Commerce
SPS Commerce perfects the power of trading partner relationships
with the industry's most broadly adopted, retail cloud services
platform. As a leader in cloud-based supply chain management
solutions, we provide proven integrations and comprehensive retail
performance analytics to thousands of customers worldwide. SPS
Commerce has achieved 59 consecutive quarters of revenue growth and
is headquartered in Minneapolis. For additional information, please
contact SPS Commerce at 866-245-8100 or visit
www.spscommerce.com.
SPS COMMERCE, SPS, and RETAIL UNIVERSE are marks of SPS
Commerce, Inc. and Registered in the U.S. Patent and Trademark
Office. 1=INFINITY logo, AS THE NETWORK GROWS, SO DOES YOUR
OPPORTUNITY, INFINITE RETAIL POWER, RETAIL UNIVERSE, RSX, SPS logo,
and others are further marks of SPS Commerce, Inc. These marks may
be registered or otherwise protected in other countries.
Use of Non-GAAP Financial Measures
To supplement its financial statements, SPS Commerce also
provides investors with Adjusted EBITDA and non-GAAP net income per
share, which are non-GAAP financial measures. SPS Commerce believes
that these non-GAAP measures provide useful information to
management and investors regarding certain financial and business
trends relating to its financial condition and results of
operations. SPS Commerce's management uses these non-GAAP measures
to compare the company's performance to that of prior periods for
trend analyses and planning purposes. It uses Adjusted EBITDA for
purposes of determining executive and senior management incentive
compensation. These measures are also presented to the company's
board of directors.
EBITDA consists of net income plus depreciation and
amortization, interest expense, interest income, income tax expense
and other adjustments as necessary for a fair presentation.
Adjusted EBITDA consists of EBITDA plus non-cash, stock-based
compensation expense. SPS Commerce uses Adjusted EBITDA as a
measure of operating performance because it assists the company in
comparing performance on a consistent basis, as it removes from
operating results the impact of the company's capital structure.
SPS Commerce believes Adjusted EBITDA is useful to an investor in
evaluating the company's operating performance because it is widely
used to measure a company's operating performance without regard to
items such as depreciation and amortization, which can vary
depending upon accounting methods and the book value of assets, and
to present a meaningful measure of corporate performance exclusive
of the company's capital structure and the method by which assets
were acquired.
Non-GAAP net income per share consists of net income plus
non-cash, stock-based compensation expense and amortization expense
related to intangible assets divided by the weighted average number
of shares of common stock outstanding during each period. SPS
Commerce believes non-GAAP net income per share is useful to an
investor because it is widely used to measure a company's operating
performance.
These non-GAAP measures should not be considered a substitute
for, or superior to, financial measures calculated in accordance
with generally accepted accounting principles in the United States.
These non-GAAP financial measures exclude significant expenses and
income that are required by GAAP to be recorded in the company's
financial statements and are subject to inherent limitations. SPS
Commerce urges investors to review the reconciliation of its
non-GAAP financial measures to the comparable GAAP financial
measures that are included in this press release.
Forward-Looking Statements
This press release may contain forward-looking statements,
including information about management's view of SPS Commerce's
future expectations, plans and prospects, including our views
regarding the impact of the acquisition of ToolBox Solutions,
future execution within our business, the opportunity we see in the
retail supply chain world and our performance for the first quarter
and full year of 2016, within the safe harbor provisions under The
Private Securities Litigation Reform Act of 1995. These statements
involve known and unknown risks, uncertainties and other factors
which may cause our results to be materially different than those
expressed or implied in such statements. Certain of these risk
factors and others are included in documents we file with the
Securities and Exchange Commission, including but not limited to,
our Annual Report on Form 10-K for the year ended December 31,
2014, as well as subsequent reports filed with the Securities and
Exchange Commission. Other unknown or unpredictable factors also
could have material adverse effects on our future results. The
forward-looking statements included in this press release are made
only as of the date hereof. We cannot guarantee future results,
levels of activity, performance or achievements. Accordingly, you
should not place undue reliance on these forward-looking
statements. Finally, we expressly disclaim any intent or obligation
to update or revise any forward-looking statements, whether as a
result of new information, future events, or otherwise.
Contact:
Kay Rindels
SPS Commerce
866-245-8100
krindels@spscommerce.com
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