Stamps.com® (Nasdaq: STMP), the leading provider of postage
online and shipping software, today announced results for the
quarter ended June 30, 2020.
Second Quarter 2020 Financial Highlights
- Total revenue was $206.7 million, up 49% compared to $138.8
million in the second quarter of 2019.
- GAAP net income was $51.7 million, up 270% compared to $14.0
million in the second quarter of 2019.
- GAAP net income per fully diluted share was $2.73, up 248%
compared to $0.79 in the second quarter of 2019.
- Non-GAAP adjusted EBITDA was $81.0 million, up 106% compared to
$39.3 million in the second quarter of 2019.
- Non-GAAP adjusted income per fully diluted share was $3.11, up
148% compared to $1.25 in the second quarter of 2019.
“In recent months, e-commerce has provided an important lifeline
to many businesses and individuals in the context of the COVID-19
pandemic, and we value our ability to provide a best-in-class
critical shipping technology that enables such e-commerce activity
for our customers and partners during this difficult time. We are
proud of our resilient employee base throughout the world and at
all levels who continue to excel during these challenging
circumstances to make significant strides towards our goal of being
the leading worldwide multi-carrier e-commerce shipping software
company,” said Ken McBride, Stamps.com’s Chairman and CEO.
Second Quarter 2020 Detailed Results
Second quarter 2020 total revenue was $206.7 million, up 49%
compared to the second quarter of 2019. Second quarter 2020 Mailing
and Shipping revenue (which includes service, product and insurance
revenue but excludes Customized Postage) was $197.9 million, up 46%
compared to the second quarter of 2019. Second quarter 2020
Customized Postage revenue was $8.8 million, up 182% compared to
the second quarter of 2019.
Second quarter 2020 GAAP income from operations was $61.2
million, GAAP net income was $51.7 million, and GAAP net income per
share was $2.73 based on 18.9 million fully diluted shares
outstanding. This compares to second quarter 2019 GAAP income from
operations of $22.4 million, GAAP net income of $14.0 million, and
GAAP net income per share of $0.79 based on 17.8 million fully
diluted shares outstanding. Second quarter 2020 GAAP income from
operations, GAAP net income, and GAAP income per fully diluted
share increased by 173%, 270%, and 248% year-over-year,
respectively.
Second quarter 2020 GAAP income from operations included $13.2
million of non-cash stock-based compensation expense and $5.5
million of non-cash amortization of acquired intangibles. Second
quarter 2020 GAAP net income included $93 thousand of non-cash
amortization of debt issuance costs. Second quarter 2020 GAAP
income tax expense was $9.0 million and non-GAAP income tax expense
was $20.7 million, resulting in an $11.7 million non-GAAP tax
expense adjustment. The higher non-GAAP tax expense reflects the
tax impact on the non-GAAP pre-tax income at a non-GAAP effective
tax rate of 26% for the second quarter. See the section later in
this release entitled, “About Non-GAAP Financial Measures” for more
information on how non-GAAP taxes are calculated. Excluding the
non-cash stock-based compensation expense and non-cash amortization
of acquired intangibles, second quarter 2020 non-GAAP income from
operations was $79.9 million. Also excluding non-cash amortization
of debt issuance costs and including the non-GAAP tax expense
adjustment, second quarter 2020 non-GAAP adjusted income was $58.8
million or $3.11 per share based on 18.9 million fully diluted
shares outstanding.
Second quarter 2019 GAAP income from operations included $9.8
million of non-cash stock-based compensation expense and $5.6
million of non-cash amortization of acquired intangibles. Second
quarter 2019 GAAP net income included $93 thousand of non-cash
amortization of debt issuance costs. Second quarter 2019 GAAP
income tax expense was $7.7 million and non-GAAP income tax expense
was $14.9 million, resulting in an $7.2 million non-GAAP tax
expense adjustment. The higher non-GAAP tax expense reflected the
tax impact on the non-GAAP pre-tax income at a non-GAAP effective
tax rate of 40.0% for the second quarter. Excluding the non-cash
stock-based compensation expense and non-cash amortization of
acquired intangibles, second quarter 2019 non-GAAP income from
operations was $37.8 million. Also excluding non-cash amortization
of debt issuance costs and including the non-GAAP tax expense
adjustment, second quarter 2019 non-GAAP adjusted income was $22.3
million or $1.25 per share based on 17.8 million fully diluted
shares outstanding.
Therefore, second quarter 2020 non-GAAP income from operations,
non-GAAP adjusted income, and non-GAAP adjusted income per fully
diluted share increased by 111%, 164%, and 148% year-over-year,
respectively.
Non-GAAP income from operations, non-GAAP adjusted income, and
non-GAAP adjusted income per share are described further in the
“About Non-GAAP Financial Measures” section of this press release
and are reconciled to the corresponding GAAP measures in the
following tables (unaudited):
Reconciliation of GAAP to Non-GAAP
Financial Measures (Second Quarter 2020)
Second Quarter Fiscal 2020
Stock-Based
Intangible
Debt
All amounts in millions except
GAAP
Compensation
Amortization
Amortization
Income Tax
Non-GAAP
per share data:
Amounts
Expense
Expense
Expense
Adjustments
Amounts
Cost of Revenues
$
47.76
$
0.93
$
-
$
-
$
-
$
46.84
Research & Development
22.88
2.95
-
-
-
19.94
Sales & Marketing
41.88
2.36
-
-
-
39.52
General & Administrative
33.02
6.99
5.51
-
-
20.52
Total Expenses
145.54
13.22
5.51
-
-
126.82
Income (Loss) from Operations
61.19
(13.22
)
(5.51
)
-
-
79.91
Interest and Other Income (Loss)
(0.48
)
-
-
(0.09
)
-
(0.39
)
Benefit (Expense) for Income Taxes
(8.98
)
-
-
-
11.70
(20.68
)
Adjusted Income (Loss)
51.73
(13.22
)
(5.51
)
(0.09
)
11.70
58.85
On a diluted per share basis
$
2.73
$
(0.70
)
$
(0.29
)
$
(0.00
)
$
0.62
$
3.11
Shares used in per share calculation
18.93
18.93
18.93
18.93
18.93
18.93
Reconciliation of GAAP to Non-GAAP
Financial Measures (Second Quarter 2019)
Second Quarter Fiscal 2019
Stock-Based
Intangible
Debt
All amounts in millions except
GAAP
Compensation
Amortization
Amortization
Income Tax
Non-GAAP
per share data:
Amounts
Expense
Expense
Expense
Adjustments
Amounts
Cost of Revenues
$
36.44
$
0.56
$
-
$
-
$
-
$
35.89
Research & Development
19.13
2.49
-
-
-
16.64
Sales & Marketing
33.24
2.28
-
-
-
30.96
General & Administrative
27.54
4.49
5.55
-
-
17.49
Total Expenses
116.35
9.82
5.55
-
-
100.97
Income (Loss) from Operations
22.42
(9.82
)
(5.55
)
-
-
37.80
Interest and Other Income (Loss)
(0.75
)
-
-
(0.09
)
-
(0.65
)
Benefit (Expense) for Income Taxes
(7.69
)
-
-
-
7.17
(14.86
)
Adjusted Income (Loss)
13.99
(9.82
)
(5.55
)
(0.09
)
7.17
22.29
On a diluted per share basis
$
0.79
$
(0.55
)
$
(0.31
)
$
(0.01
)
$
0.40
$
1.25
Shares used in per share calculation
17.81
17.81
17.81
17.81
17.81
17.81
Second Quarter GAAP Net Income and Non-GAAP Adjusted
EBITDA
Second quarter 2020 GAAP net income was $51.7 million, up 270%
compared to $14.0 million in the second quarter of 2019.
Second quarter 2020 non-GAAP adjusted EBITDA was $81.0 million,
up 106% compared to $39.3 million in the second quarter of
2019.
Adjusted EBITDA is a non-GAAP financial measure which is
described further in the “About Non-GAAP Financial Measures”
section of this press release and is reconciled to GAAP net income
in the following table (unaudited):
Reconciliation of GAAP Net Income to
Non-GAAP Adjusted EBITDA
Second Quarter
Three Months ended
All amounts in millions
June 30,
2020
2019
GAAP Net Income (Loss)
$
51.73
$
13.99
Depreciation and Amortization Expense
$
6.55
$
7.03
Interest & Other Expense (Income), net
$
0.48
$
0.75
Income Tax Expense (Benefit), net
$
8.98
$
7.69
Stock-based Compensation Expense
$
13.22
$
9.82
Adjusted EBITDA
$
80.96
$
39.28
Adjusted EBITDA Margin
39.2
%
28.3
%
Taxes
For the second quarter of 2020, the Company reported a GAAP
income tax expense of $9.0 million representing an effective tax
rate of 14.8%. For the second quarter of 2019, the Company reported
a GAAP income tax expense of $7.7 million representing an effective
tax rate of 35.5%. As discussed below under the heading, “About
Non-GAAP Financial Measures,” we believe our effective annual tax
rate for 2020 will be approximately 28.0%. Accordingly, the second
quarter 2020 effective rate of 14.8% should not be assumed to apply
for 2020 as a whole, and our after tax income during the remainder
of 2020 will likely reflect a materially higher rate than is
reflected in our after tax results for the second quarter of 2020.
Our second quarter 2020 GAAP net income should also be understood
to have been positively impacted by the lower effective tax rate
applicable specifically to the quarter.
Share Repurchase and Debt Repayment
During the second quarter of 2020, the Company repurchased
approximately 56 thousand shares at a total cost of approximately
$9.4 million.
On February 13, 2020, our Board of Directors approved a share
repurchase plan which became effective on February 24, 2020 and
which authorizes the Company to repurchase up to $40 million of
stock over the six months following its effective date. On February
28, 2020, our Board of Directors adjusted the repurchase parameters
of the plan in response to increased market volatility to
repurchase an aggregate of approximately $19 million through the
plan’s expiration in August 2020, and which became effective March
3, 2020.
On August 3, 2020, our Board of Directors approved a new share
repurchase plan which will commence on August 11, 2020 and which
authorizes the Company to repurchase up to $40 million of stock
over approximately six months following its effective date. This
new repurchase plan replaces our existing repurchase plan.
During the second quarter of 2020, as previously disclosed, the
Company repaid the principal balance of $47.4 million under the
Company’s existing credit agreement related to the Endicia
acquisition. On June 29, 2020, the Company amended and restated
this existing credit agreement for a new revolving credit facility
of up to $130 million with a term of two years. As of June 30,
2020, total debt under the amended and restated credit agreement,
excluding debt issuance costs, was $0 million.
Customized Postage
Effective June 16, 2020, the USPS terminated its customized
postage program and thereby also revoked our authorization to offer
products pursuant to that program. The primary product subject to
termination was offered by the Company under the brand PhotoStamps.
The revenue and cost of revenue associated with these products
appear on our financial statements as “Customized postage.” The
financial impact associated with the elimination of this product is
reflected in our financial guidance.
Summary of our Business Outlook
For fiscal year 2020, the Company currently expects its GAAP
financial outlook to be as follows:
- We expect total revenue to be in a range of approximately $650
million to $725 million; this compares to previous guidance of $570
million to $600 million.
- We expect GAAP net income to be in a range of approximately $79
million to $122 million; this compares to previous guidance of $41
million to $53 million.
- We expect GAAP net income per fully diluted share to be in a
range of approximately $3.93 to $6.70; this compares to previous
guidance of $2.08 to $2.92.
- We expect our 2020 effective tax rate to be approximately 28%;
this compares to previous guidance of 40%.
The above GAAP amounts, adjusted as detailed below, result in
the following non-GAAP financial outlook:
- We expect non-GAAP adjusted EBITDA to be in a range of
approximately $180 million to $240 million; this compares to
previous guidance of $135 million to $155 million.
- We expect non-GAAP adjusted income per fully diluted share to
be in a range of approximately $6.25 to $9.25; this compares to
previous guidance of $4.00 to $5.00.
Detailed Discussion of our Business Outlook
As noted above, for 2020, the Company currently expects total
revenue to be in a range of approximately $650 million to $725
million; this compares to previous guidance of $570 million to $600
million.
Also, for 2020, the Company currently expects GAAP net income to
be in a range of approximately $79 million to $122 million; this
compares to previous guidance of $41 million to $53 million.
The expected GAAP net income range includes depreciation and
amortization expense of approximately $26 million, stock-based
compensation expense of approximately $43 million, interest and
other expense, net of approximately $1 million, and income tax
expense of approximately $31 million to $ 48 million. Excluding the
depreciation and amortization expense, stock-based compensation
expense, interest and other expense, net and income tax expense, we
expect non-GAAP adjusted EBITDA to be in a range of approximately
$180 million to $240 million; this compares to previous guidance of
$135 million to $155 million.
The following table is provided to facilitate a reconciliation
of 2020 expected non-GAAP adjusted EBITDA to expected GAAP net
income:
Fiscal Year 2020
Guidance
All amounts in millions
Low End of Range
High End of Range
GAAP net income
$
79.3
$
122.5
Adjustments to reconcile adjusted
EBITDA to GAAP net income: Stock-based compensation expense
$
42.5
$
42.5
Depreciation and amortization expense
$
26.0
$
26.0
Interest and other expense (income), net
$
1.4
$
1.4
Income tax expense
$
30.8
$
47.6
Total adjustments excluded from adjusted EBITDA
$
100.7
$
117.5
Adjusted EBITDA
$
180.0
$
240.0
As noted above, for 2020, the Company currently expects GAAP net
income per fully diluted share to be in a range of approximately
$3.93 to $6.70; this compares to previous guidance of $2.08 to
$2.92. The expected GAAP net income per fully diluted share range
includes non-cash stock-based compensation expense of approximately
$43 million, non-cash amortization of acquired intangibles expense
of approximately $22 million, and non-cash amortization of debt
issuance costs of approximately $0.4 million. Excluding the
stock-based compensation expense, amortization of acquired
intangibles expense, and amortization of debt issuance costs, and
including higher expected non-GAAP income taxes of approximately
$18 million from the expected tax effects of these adjustments at
an assumed 28% effective full-year tax rate, we expect non-GAAP
adjusted income per fully diluted share to be in a range of $6.25
to $9.25; this compares to previous guidance of $4.00 to $5.00.
The following table is provided to facilitate a reconciliation
of 2020 expected non-GAAP adjusted income per fully diluted share
to expected GAAP net income per fully diluted share:
Fiscal Year 2020
Guidance
All amounts in millions except percentages and per share data
Low End of Range
High End of Range
GAAP net income per fully diluted share
$
3.93
$
6.70
Adjustments to reconcile non-GAAP to
GAAP: Stock-based compensation expense
$
42.5
$
42.5
Amortization of acquired intangibles
$
22.0
$
22.0
Amortization of debt issuance costs
$
0.4
$
0.4
Total adjustments excluded from non-GAAP
$
64.9
$
64.9
Projected effective tax rate
28.0
%
28.0
%
Increased tax expense from non-GAAP
adjustments
$
18.2
$
18.2
Total tax affected adjustments excluded from non-GAAP
$
46.7
$
46.7
Fully diluted shares
20.2
18.3
Total adjustments excluded from non-GAAP adjusted income per fully
diluted share
$
2.32
$
2.55
Non-GAAP adjusted income per fully diluted share
$
6.25
$
9.25
This business outlook does not include the impact from potential
future acquisitions, including acquisition costs or related
financings, or unanticipated events. This business outlook also
does not include the impact of foreign currency fluctuations, or
other geopolitical events, such as trade negotiations or Brexit.
This business outlook also does not include the impact of employee
stock option exercises and any associated tax effects. This
business outlook and the related assumptions are forward-looking
statements subject to the safe harbor statement contained at the
end of this press release, and reflect our views of current and
future market conditions as of the date of this press release.
Ranges reflect our business assumptions, but actual results could
fall outside the ranges presented. Only a few of our assumptions
underlying our guidance are disclosed above, and our actual results
will be affected by known and unknown risks, trends, uncertainties
and other factors, many of which are beyond our control or ability
to predict. Although we believe that the assumptions underlying our
guidance are reasonable, they are not guarantees of future
performance and some of them will inevitably prove to be incorrect.
As a result, our actual future results can be expected to differ
from our expectations, and those differences could be material, as
a result of, among other things, the factors described under
“Forward-Looking Statements,” below. We do not undertake any
obligation to release publicly any revisions to our business
outlook or other forward-looking statements to reflect events or
circumstances after the date hereof or to reflect the occurrence of
unanticipated events.
Company Metrics and Conference Call
2020 Company metrics, updated to include the second quarter, is
available at https://investor.stamps.com (under a tab on the left
side called “Company Information, Metrics”). These metrics are not
incorporated into this press release.
The Stamps.com financial results conference call will be webcast
today at 5:00 p.m. Eastern Time and may be accessed at
https://investor.stamps.com. The Company plans to discuss its
business outlook during the conference call. Following the
conclusion of the webcast, a replay of the call will be available
at the same website.
About Stamps.com, Endicia, ShipStation, ShipWorks,
ShippingEasy, ShipEngine and MetaPack
Stamps.com (Nasdaq: STMP) is the leading provider of postage
online and shipping software solutions to customers, including
consumers, small businesses, e-commerce shippers, enterprises, and
high volume shippers. Stamps.com offers solutions that help
businesses run their shipping operations more smoothly and function
more successfully under the brand names Stamps.com, Endicia,
ShipStation, ShipWorks, ShippingEasy, ShipEngine and MetaPack.
Stamps.com’s family of brands provides seamless access to mailing
and shipping services through integrations with more than 500
unique partner applications.
Endicia is a leading brand for high volume shipping technologies
and services for U.S. Postal Service shipping. Under this brand we
offer solutions that help businesses run their shipping operations
more smoothly and function more successfully. Our Endicia branded
solutions also provide seamless access to USPS shipping services
through integrations with partner applications.
ShipStation is a leading web-based shipping solution that helps
e-commerce retailers import, organize, process, package, and ship
their orders quickly and easily from any web browser. ShipStation
features the most integrations of any e-commerce web-based solution
with more than 350 shopping carts, marketplaces, package carriers,
and fulfillment services. Integration partners include eBay,
PayPal, Amazon, Etsy, Square, Shopify, BigCommerce, Volusion,
Magento, Squarespace, and carriers such as USPS, UPS, FedEx and
DHL. ShipStation has sophisticated automation features such as
automated order importing, custom hierarchical rules, product
profiles, and fulfillment solutions that enable its customers to
complete their orders, wherever they sell, and however they
ship.
ShipWorks is a leading brand for client-based shipping solutions
that help high volume shippers import, organize, process, fulfill,
and ship their orders quickly and easily from any standard PC. With
integrations to more than 100 shopping carts, marketplaces, package
carriers, and fulfillment services, ShipWorks has the most
integrations of any high-volume client shipping solution. Package
carriers include USPS, UPS, FedEx, DHL, OnTrac and many more.
Marketplace and shopping cart integrations include eBay, PayPal,
Amazon, Etsy, Shopify, BigCommerce, Volusion, ChannelAdvisor,
Magento, and many more. ShipWorks has sophisticated automation
features such as a custom rules engine, automated order importing,
automatic product profile detection, and fulfillment automation,
which enable high volume shippers to complete their orders quickly
and efficiently.
ShippingEasy provides a single platform for e-commerce merchants
to automate order imports and shipping, manage inventory, and
increase sales through customer email marketing and online reviews.
Powerful integrations with leading online channels such as Amazon,
eBay, Etsy, Walmart, Shopify, Magento, WooCommerce and many others
allow merchants to manage orders from everywhere they sell all in
one place. The inclusion of email marketing and inventory
management solutions plus award-winning support from real humans
via phone, email, and chat lets online merchants streamline their
businesses and increase orders through a single integrated platform
that provides more than best-in-class shipping solutions.
ShipEngine offers a multi-carrier shipping platform for
e-commerce stores, logistics and warehouse providers, systems
integrators, e-commerce application integrators, and new
application developers. ShipEngine APIs enable developers to build
custom workflows within their own platforms and streamline the
e-commerce fulfillment process with real-time label generation,
rate quoting, parcel tracking, and address validation. ShipEngine
supports more than 30 different carriers and includes integrations
with leading e-commerce service providers, shopping carts, and
marketplaces.
MetaPack helps e-commerce and delivery professionals to meet
with the consumer’s growing expectations of delivery, while
maintaining and optimizing operational efficiency. MetaPack’s SaaS
solution offers a wide range of personalized delivery services,
from global order tracking to simplified return procedures, through
a catalog of more than 450 carriers and 5,000 services available
that span every country in the world.
About Non-GAAP Financial Measures
To supplement the Company’s condensed consolidated balance
sheets and consolidated statements of income presented in
accordance with GAAP, the Company uses non-GAAP measures of certain
components of financial performance. These non-GAAP measures
include non-GAAP income from operations, non-GAAP adjusted income,
non-GAAP adjusted income per fully diluted share and adjusted
EBITDA.
Non-GAAP financial measures are provided to enhance investors’
overall understanding of the Company’s financial performance and
prospects for the future and as a means to evaluate
period-to-period comparisons. The Company believes the non-GAAP
measures, which: (1) exclude certain non-cash items including
stock-based compensation expense, amortization of acquired
intangibles, amortization of debt issuance costs, and contingent
consideration charges; (2) exclude certain expenses and gains such
as acquisition related expenses, litigation settlement expenses,
executive consulting expenses, and insurance proceeds; and (3)
include income tax adjustments, provide meaningful supplemental
information regarding financial performance by excluding certain
expenses and benefits that may not be reflective of our underlying
operating performance.
Non-GAAP adjusted income is calculated as GAAP net income plus
the cumulative impact of the adjustments outlined in the paragraph
immediately above.
Non-GAAP adjusted income per fully diluted share is calculated
as non-GAAP adjusted income divided by fully diluted shares.
Non-GAAP income tax expense for the first, second and third
quarters of our fiscal year are calculated by multiplying the
projected annual effective tax rate in that quarter by the non-GAAP
adjusted income before taxes for the quarter. Among other things,
the projected annual effective tax rate does not reflect potential
future employee option exercises in the remaining quarters of the
fiscal year due to the inherent difficulty in forecasting employee
option exercises. The projected annual effective tax rate also
considers other factors including the Company’s tax structure and
its tax positions in various jurisdictions where the Company
operates. The actual annual effective tax rate realized for the
fiscal year could differ materially from our projected annual
effective tax rate used in the first, second and third
quarters.
Non-GAAP income tax expense for the fourth quarter of the fiscal
year is calculated by multiplying the actual effective tax rate for
the fiscal year by the non-GAAP adjusted income before taxes for
the fiscal year and subtracting the non-GAAP income tax expense or
benefit reported in the first, second and third quarters. As a
result, the fourth quarter reflects the tax impact of reconciling
the first, second and third quarter projected annual effective
rates to the actual effective tax rate for the fiscal year.
The projected non-GAAP full-year tax rate for 2020 is 28.0%. The
decrease in our estimated effective tax rate for 2020 was primarily
driven by an increase in projected pre-tax book income and employee
stock option exercises.
Adjusted EBITDA as calculated in this press release represents
earnings before interest and other expense, net, interest and other
income, net, income tax expense or benefit, depreciation and
amortization and excludes certain items, such as stock-based
compensation expense.
The presentation of non-GAAP financial measures 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. These non-GAAP financial measures may differ from
similarly titled measures used by other companies. Reconciliation
of non-GAAP financial measures included in this press release to
the corresponding GAAP measures can be found in the financial
tables of this press release.
The Company believes that non-GAAP financial measures, when
viewed with GAAP results and the accompanying reconciliation,
enhance the comparability of operating results against prior
periods and allow for greater transparency of operating results.
Management uses non-GAAP financial measures in making financial,
operating, compensation and planning decisions. The Company
believes non-GAAP financial measures facilitate management and
investors in comparing the Company’s financial performance to that
of prior periods as well as in performing trend analysis over
time.
Share Repurchase Timing
The timing of share repurchases, if any, and the number of
shares to be bought at any one time will depend on factors
including market conditions and the Company’s compliance with the
covenants in its Amended and Restated Credit Agreement. Share
repurchases may be made from time to time on the open market or in
negotiated transactions at the Company's discretion in compliance
with Rule 10b-18 of the United States Securities and Exchange
Commission. The Company's purchase of any of its shares may be
subject to limitations imposed on such purchases by applicable
securities laws and regulations and the rules of the Nasdaq Stock
Market.
"Safe Harbor" Statement Under the Private Securities
Litigation Reform Act of 1995
This release includes “forward-looking statements” within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended.
Forward-looking statements are statements that are not historical
facts, and may relate to future events or the Company’s anticipated
results, business strategies or capital requirements, among other
things, all of which involve risks and uncertainties. You can
identify many (but not all) such forward-looking statements by
looking for words such as “assumes,” “approximates,” “believes,”
“expects,” “anticipates,” “estimates,” “projects,” “seeks,”
“intends,” “plans,” “could,” “would,” “may” or other similar
expressions, and include statements that refer to future responses
to and effects of the COVID-19 pandemic. Important factors which
could cause actual results to differ materially from those in the
forward-looking statements, include (i) the Company’s ability to
monetize its customers’ transactions with carriers, including
uncertainties regarding the duration, renegotiation and ultimate
impact of existing and potential future arrangements with carriers
and partners and our success in implementing our strategy over the
long term, (ii) the significant and unprecedented uncertainty
regarding the business and economic impact of the ongoing COVID-19
pandemic (as well as the impact of efforts of governments,
businesses and individuals to mitigate the effects of such
pandemic) on the Company, its customers, its carrier and
integration partners and the global economy, which makes it
particularly difficult to predict the nature and extent of impacts
on demand for our products and services, making our business
outlook subject to considerable uncertainty, (iii) the Company's
ability to successfully integrate and realize the benefits of its
past or future strategic acquisitions or investments, (iv) the
Company’s ability to diversify its relationships with carriers, (v)
the impact of foreign exchange fluctuations and geopolitical risks,
and (vi) other important factors that are detailed in filings with
the Securities and Exchange Commission made from time to time by
Stamps.com, including its Annual Report on Form 10-K for the year
ended December 31, 2019, Quarterly Reports on Form 10-Q
(particularly the “Risk Factors” sections of those reports), and
Current Reports on Form 8-K. Matters described in forward-looking
statements may also be affected by other known and unknown risks,
trends, uncertainties and factors, many of which are beyond the
Company’s ability to control or predict. Copies of these filings
may be obtained by visiting our investors relations website at
www.stamps.com or the SEC’s website at www.sec.gov. Stamps.com
undertakes no obligation to release publicly any revisions to any
forward-looking statements to reflect events or circumstances after
the date hereof or to reflect the occurrence of unanticipated
events.
Trademarks
Stamps.com, the Stamps.com logo, Endicia, MetaPack, PhotoStamps,
ShipEngine, ShippingEasy, ShipStation and ShipWorks are registered
trademarks of Stamps.com Inc. and its subsidiaries. All other
brands and names used in this release are the property of their
respective owners.
STAMPS.COM INC. AND
SUBSIDIARIES
CONSOLIDATED STATEMENTS OF
OPERATIONS
(in thousands, except per share
data: unaudited)
Three Months ended June
30,
Six Months ended June
30,
2020
2019
2020
2019
Revenues: Service
$
186,990
$
127,429
$
326,126
$
251,336
Product
6,827
4,785
12,783
10,190
Insurance
4,096
3,431
7,276
6,765
Customized postage
8,817
3,128
11,891
6,485
Total revenues
206,730
138,773
358,076
274,776
Cost of revenues: Service
37,465
32,452
73,992
64,687
Product
2,411
1,549
4,149
3,222
Customized postage
7,885
2,440
10,000
4,871
Total cost of revenues
47,761
36,441
88,141
72,780
Gross profit
158,969
102,332
269,935
201,996
Operating expenses: Sales and marketing
41,884
33,242
78,888
66,123
Research and development
22,884
19,130
44,207
36,444
General and administrative
33,015
27,535
61,483
53,763
Total operating expenses
97,783
79,907
184,578
156,330
Income from operations
61,186
22,425
85,357
45,666
Foreign currency exchange gain (loss), net
(33
)
(152
)
(171
)
(247
)
Interest expense
(456
)
(645
)
(923
)
(1,359
)
Interest income and other income (loss), net
6
52
32
117
Income before income taxes
60,703
21,680
84,295
44,177
Income tax expense
8,977
7,688
16,075
14,430
Net income
$
51,726
$
13,992
$
68,220
$
29,747
Net income per share: Basic
$
3.00
$
0.81
$
3.98
$
1.71
Diluted
$
2.73
$
0.79
$
3.68
$
1.66
Weighted average shares outstanding: Basic
17,231
17,291
17,148
17,418
Diluted
18,927
17,809
18,558
17,911
CONDENSED CONSOLIDATED BALANCE
SHEETS
(in thousands, unaudited)
June 30,
December 31,
2020
2019
ASSETS Cash and cash equivalents
$
275,053
$
156,307
Accounts receivable, net
56,416
74,898
Prepaid expenses and other current assets
52,085
43,478
Property and equipment, net
33,141
32,983
Goodwill and intangible assets, net
503,240
529,603
Deferred income taxes, net
27,056
27,056
Other assets
45,423
38,171
Total assets
$
992,414
$
902,496
LIABILITIES AND STOCKHOLDERS' EQUITY Liabilities:
Accounts payable and other liabilities
$
205,738
$
167,213
Debt, net of debt issuance costs
-
50,188
Deferred income taxes, net
10,725
11,455
Deferred revenue
10,681
8,015
Total liabilities
227,144
236,871
Stockholders' equity: Common stock
56
56
Additional paid-in capital
1,162,890
1,098,426
Treasury stock
(611,485
)
(593,511
)
Retained earnings
219,161
150,941
Accumulated other comprehensive income (loss)
(5,352
)
9,713
Total stockholders' equity
765,270
665,625
Total liabilities and stockholders' equity
$
992,414
$
902,496
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200806006053/en/
Investor Contact: Suzanne Park
Stamps.com Investor Relations (310) 482-5830 invrel@stamps.com
Press Contact: Eric Nash Stamps.com
Public Relations (310) 482-5942 enash@stamps.com
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