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| 8-K - FORM 8-K - INNOTRAC CORP | t77812_8k.htm |
Exhibit 99.1
Innotrac Corporation Announces 2013 Third Quarter Results
ATLANTA, GA (November 14, 2013) – Innotrac Corporation (NASDAQ: INOC) announced financial results today for the third quarter ended September 30, 2013. Total revenues for the quarter increased $4.1 million (15.8%) to $29.8 million from $25.7 million for the three months ended September 30, 2012. Total revenue for the nine month period ended September 30, 2013, increased $15.5 million (21.3%) to $88.3 million from $72.8 million for the nine months ended September 30, 2012. Revenue from new clients and growth of existing clients were the key drivers of this revenue growth.
The Company reported net income of $18.5 million, or $1.39 per share, fully diluted, for the third quarter ended September 30, 2013, as compared to $1.1 million, or $0.08 per share for the quarter ended September 30, 2012. Net income for the nine months ended September 30, 2013 was $20.4 million, or $1.55 per share, as compared to $2.0 million, or $0.15 per share, for the nine months ended September 30, 2012.
In the third quarter ended September 30, 2013, Innotrac released a valuation allowance of $17.2 million that was previously recorded against deferred tax assets primarily related to net operating loss carryforwards. The Company did not generate any cash flow from the income tax benefit recorded in the consolidated statements of operations for the period ended September 30, 2013. This income tax benefit did not have any impact on business operations during the quarter. This $17.2 million income tax benefit recorded in the quarter ended September 30, 2013 accounted for $1.30 of the total $1.39 fully diluted earnings per share for the quarter ended September 30, 2013 and $1.30 of the total $1.55 earnings per share for the nine months ended September 30, 2013.
About Innotrac
Innotrac Corporation, founded in 1984 and based near Atlanta, Georgia, is a best-in-class commerce provider integrating digital technology, fulfillment, contact center and business intelligence solutions to support global brands. Innotrac’s fulfillment, order management and contact center solutions are integrated with all major web platforms, and seamlessly integrate with any required partner technologies. The Company employs sophisticated order processing and warehouse management technology and operates eight fulfillment centers and one call center spanning all time zones across the continental United States. Innotrac Europe GmbH has a network of fulfillment centers, call centers, and returns processing facilities with operations in the UK, Germany, France, Denmark, Sweden, Poland, Austria, Italy, Switzerland, Ireland, Spain and the Netherlands. Connect with Innotrac at www.innotrac.com or http://www.linkedin.com/company/innotrac.
Information contained in this press release, other than historical information, may be considered forward-looking in nature. Forward-looking statements in this release include statements relating to future events and developments, as well as management’s expectations, beliefs, plans, estimates and projections relating to the future. Forward-looking statements are subject to various risks, uncertainties and assumptions. Please refer to the Risk Factors discussed in Innotrac’s 2012 Annual Report on Form 10-K and other filings on file with the Securities and Exchange Commission. Innotrac disclaims any intention or obligation to update or revise any forward-looking statement whether as a result of new information, future events or otherwise.
Contact
Steve Keaveney
Chief Financial Officer
678-584-4020
skeaveney@innotrac.com
INNOTRAC CORPORATION and SUBSIDIARY
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
|
September 30, 2013
|
December 31, 2012
|
|||||||
|
(unaudited)
|
||||||||
|
ASSETS
|
||||||||
|
Current assets:
|
||||||||
|
Cash and cash equivalents
|
$ | 3,450 | $ | 4,005 | ||||
|
Accounts receivable (net of allowance for doubtful accounts of $134 at September 30, 2013 and $136 at December 31, 2012)
|
20,084 | 23,216 | ||||||
|
Inventories, net
|
704 | 740 | ||||||
|
Deferred income taxes
|
639 | - | ||||||
|
Prepaid expenses and other
|
1,277 | 1,107 | ||||||
|
Total current assets
|
26,154 | 29,068 | ||||||
|
Property and equipment:
|
||||||||
|
Computers, machinery and equipment
|
48,495 | 42,877 | ||||||
|
Furniture, fixtures and leasehold improvements
|
10,405 | 10,055 | ||||||
| 58,900 | 52,932 | |||||||
|
Less accumulated depreciation and amortization
|
(41,990 | ) | (39,089 | ) | ||||
| 16,910 | 13,843 | |||||||
|
Deferred income taxes
|
16,569 | - | ||||||
|
Other assets, net
|
1,459 | 1,281 | ||||||
|
Total assets
|
$ | 61,092 | $ | 44,192 | ||||
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
||||||||
|
Current liabilities:
|
||||||||
|
Accounts payable
|
$ | 7,957 | $ | 10,409 | ||||
|
Line of credit
|
- | - | ||||||
|
Accrued salaries
|
1,828 | 2,854 | ||||||
|
Equipment lease payable
|
652 | 421 | ||||||
|
Accrued expenses and other
|
3,742 | 3,088 | ||||||
|
Equipment loan
|
- | 1,620 | ||||||
|
Total current liabilities
|
14,179 | 18,392 | ||||||
|
Noncurrent liabilities:
|
||||||||
|
Deferred compensation
|
969 | 837 | ||||||
|
Equipment lease payable
|
1,188 | 544 | ||||||
|
Other noncurrent liabilities
|
697 | 963 | ||||||
|
Total noncurrent liabilities
|
2,854 | 2,344 | ||||||
|
Shareholders’ equity:
|
||||||||
|
Preferred stock: 10,000,000 shares authorized, $0.10 par value, no shares issued or outstanding
|
- | - | ||||||
|
Common stock: 50,000,000 shares authorized, $0.10 par value, 13,245,440 shares issued and outstanding at September 30, 2013 13,155,440 shares issued and outstanding at December 31, 2012
|
1,325 | 1,316 | ||||||
|
Additional paid-in capital
|
66,930 | 66,784 | ||||||
|
Accumulated other comprehensive loss
|
(2 | ) | (2 | ) | ||||
|
Accumulated deficit
|
(24,207 | ) | (44,656 | ) | ||||
|
Total Innotrac shareholders’ equity
|
44,046 | 23,442 | ||||||
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Noncontrolling interest
|
13 | 14 | ||||||
|
Total shareholders’ equity
|
44,059 | 23,456 | ||||||
|
Total liabilities and shareholders’ equity
|
$ | 61,092 | $ | 44,192 | ||||
INNOTRAC CORPORATION and SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
For the Three Months Ended September 30, 2013 and 2012
(in thousands, except per share amounts)
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
For the Three Months Ended September 30, 2013 and 2012
(in thousands, except per share amounts)
|
Three Months Ended September 30,
|
||||||||
|
2013
|
2012
|
|||||||
|
(unaudited)
|
(unaudited)
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|||||||
|
Service revenues
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$ | 26,410 | $ | 22,088 | ||||
|
Freight revenues
|
3,345 | 3,606 | ||||||
|
Total revenues
|
29,755 | 25,694 | ||||||
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Cost of service revenues
|
13,391 | 10,368 | ||||||
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Freight expense
|
3,240 | 3,463 | ||||||
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Selling, general and administrative expenses
|
10,816 | 9,674 | ||||||
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Depreciation and amortization
|
996 | 995 | ||||||
|
Total operating expenses
|
28,443 | 24,500 | ||||||
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Operating income
|
1,312 | 1,194 | ||||||
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Other expense (income):
|
||||||||
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Interest expense
|
41 | 90 | ||||||
|
Other (income) expense
|
(1 | ) | (2 | ) | ||||
|
Total other expense
|
40 | 88 | ||||||
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Income before income taxes
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1,272 | 1,106 | ||||||
|
Income tax benefit
|
(17,184 | ) | - | |||||
|
Net income
|
18,456 | 1,106 | ||||||
|
Net loss attributable to noncontrolling interest
|
1 | (1 | ) | |||||
|
Net income attributable to Innotrac
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$ | 18,457 | $ | 1,105 | ||||
|
Earnings per share:
|
||||||||
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Basic
|
$ | 1.39 | $ | 0.08 | ||||
|
Diluted
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$ | 1.39 | $ | 0.08 | ||||
|
Weighted average shares outstanding:
|
||||||||
|
Basic
|
13,245 | 13,058 | ||||||
|
Diluted
|
13,267 | 13,058 | ||||||
INNOTRAC CORPORATION and SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
For the Nine Months Ended September 30, 2013 and 2012
(in thousands, except per share amounts)
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
For the Nine Months Ended September 30, 2013 and 2012
(in thousands, except per share amounts)
|
Nine Months Ended September 30,
|
||||||||
|
2013
|
2012
|
|||||||
|
(unaudited)
|
(unaudited)
|
|||||||
|
Service revenues
|
$ | 77,875 | $ | 63,857 | ||||
|
Freight revenues
|
10,471 | 8,953 | ||||||
|
Total revenues
|
88,346 | 72,810 | ||||||
|
Cost of service revenues
|
38,839 | 30,326 | ||||||
|
Freight expense
|
10,129 | 8,639 | ||||||
|
Selling, general and administrative expenses
|
32,988 | 28,931 | ||||||
|
Depreciation and amortization
|
2,901 | 2,711 | ||||||
|
Total operating expenses
|
84,857 | 70,607 | ||||||
|
Operating income
|
3,489 | 2,203 | ||||||
|
Other expense:
|
||||||||
|
Interest expense
|
196 | 212 | ||||||
|
Other expense
|
(1 | ) | - | |||||
|
Total other expense
|
195 | 212 | ||||||
|
Income before income taxes
|
3,294 | 1,991 | ||||||
|
Income tax benefit
|
(17,154 | ) | - | |||||
|
Net income
|
20,448 | 1,991 | ||||||
|
Net loss attributable to noncontrolling interest
|
1 | - | ||||||
|
Net income attributable to Innotrac
|
$ | 20,449 | $ | 1,991 | ||||
|
Earnings per share:
|
||||||||
|
Basic
|
$ | 1.55 | $ | 0.15 | ||||
|
Diluted
|
$ | 1.55 | $ | 0.15 | ||||
|
Weighted average shares outstanding:
|
||||||||
|
Basic
|
13,199 | 13,033 | ||||||
|
Diluted
|
13,215 | 13,033 | ||||||
INNOTRAC CORPORATION and SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Nine Months Ended September 30, 2013 and 2012
(in thousands)
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Nine Months Ended September 30, 2013 and 2012
(in thousands)
|
Nine Months Ended September 30,
|
||||||||
|
2013
|
2012
|
|||||||
|
(unaudited)
|
(unaudited)
|
|||||||
|
Cash flows from operating activities:
|
||||||||
|
Net Income
|
$ | 20,448 | $ | 1,991 | ||||
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
||||||||
|
Depreciation and amortization
|
2,901 | 2,711 | ||||||
|
Provision for bad debts
|
3 | 18 | ||||||
|
Deferred income taxes
|
(17,208 | ) | - | |||||
|
Stock compensation expense-restricted stock
|
155 | 124 | ||||||
|
Changes in operating assets and liabilities:
|
||||||||
|
Accounts receivable, gross
|
3,129 | (1,611 | ) | |||||
|
Inventory
|
36 | 160 | ||||||
|
Prepaid expenses and other
|
(126 | ) | (230 | ) | ||||
|
Long-term assets
|
52 | (69 | ) | |||||
|
Accounts payable
|
(3,929 | ) | (1,661 | ) | ||||
|
Accrued expenses, accrued salaries and other
|
(372 | ) | 396 | |||||
|
Long-term liabilities
|
(266 | ) | (91 | ) | ||||
|
Net cash provided by operating activities
|
4,823 | 1,738 | ||||||
|
Cash flows from investing activities:
|
||||||||
|
Capital expenditures
|
(3,291 | ) | (4,703 | ) | ||||
|
Proceeds from disposition of assets
|
- | 1 | ||||||
|
Net change in noncurrent assets and liabilities
|
(10 | ) | (9 | ) | ||||
|
Net cash used in investing activities
|
(3,301 | ) | (4,711 | ) | ||||
|
Cash flows from financing activities:
|
||||||||
|
Borrowings on equipment loan
|
- | 1,800 | ||||||
|
Payments on equipment loan
|
(1,620 | ) | (90 | ) | ||||
|
Capital lease payments
|
(326 | ) | (321 | ) | ||||
|
Loan commitment fees
|
(131 | ) | (37 | ) | ||||
|
Net cash (used in) provided by financing activities
|
(2,077 | ) | 1,352 | |||||
|
Net increase (decrease) in cash and cash equivalents
|
(555 | ) | (1,621 | ) | ||||
|
Cash and cash equivalents, beginning of period
|
4,005 | 3,283 | ||||||
|
Cash and cash equivalents, end of period
|
$ | 3,450 | $ | 1,662 | ||||
|
Supplemental cash flow disclosures:
|
||||||||
|
Cash paid for interest
|
$ | 151 | $ | 148 | ||||
|
Non-cash investing and financing activities:
|
||||||||
|
Capital lease for warehouse and computer equipment
|
$ | 1,201 | $ | 862 | ||||
|
Capital expenditures in accounts payable
|
$ | 1,477 | $ | 287 | ||||