Wayside Technology Group, Inc. Reports 2016 Second Quarter Results and Declares Quarterly Dividend
/EINPresswire.com/ -- SHREWSBURY, NJ -- (Marketwired) -- 07/28/16 -- Wayside Technology Group, Inc. (NASDAQ: WSTG)
Q2 2016:
Revenue: $105.3 million
Income from operations: $2.2 million
Net income: $1.5 million
Diluted earnings per share: $0.34 per share
Dividend declared - $0.17 per share
Wayside Technology Group, Inc. (NASDAQ: WSTG) today announced financial results for the second quarter ended June 30, 2016. The results will be discussed in a conference call to be held on Friday, July 29, 2016 at 10:00 a.m. EDT. The dial-in telephone number is (866) 814-8482 and the pass code is "WSTG." This conference call will be webcast by NASDAQ OMX and can be accessed at Wayside Technology's website at www.waysidetechnology.com/earnings-call.
"I am pleased to report solid financial results for Q2 2016 with both of our segments performing well. Overall, revenue increased 14% to a record $105.3 million and income from operations increased 14% over the same period last year," said Simon F. Nynens, Chairman and Chief Executive Officer.
Net sales for the second quarter ended June 30, 2016 increased 14% or $13.3 million to a record $105.3 million compared to $92.0 million for the same period in 2015. Total sales for the second quarter of 2016 for our Lifeboat Distribution segment were $89.7 million compared to $81.3 million in the second quarter of 2015, representing an increase of $8.4 million or 10%. Total sales for the second quarter of 2016 for our TechXtend segment were $15.6 million compared to $10.7 million in the second quarter of 2015, representing an increase of $4.9 million or 46%.
The 10% increase in net sales for the Lifeboat Distribution segment was mainly a result of the addition of several key product lines and our ongoing strategy of strengthening of our account penetration. This was offset in part by lower sales to one of our key accounts. The 46% increase in net sales in the TechXtend segment was primarily due to an increase of $5.6 million in extended payment terms sales transactions as compared to the second quarter ended June 30, 2015.
Cash and long term receivables amounted to $30.5 million, representing 79% of equity as of June 30, 2016. Working capital amounted to $31.9 million, representing 83% of equity as of June 30, 2016.
Gross Profit for the second quarter ended June 30, 2016 was $7.0 million, a 9% increase compared to $6.4 million for the second quarter of 2015. Gross profit for our Lifeboat segment in the second quarter of 2016 was approximately $5.5 million compared to approximately $5.1 million for the second quarter of 2015, representing a 9% increase. Gross profit for our TechXtend segment in the second quarter of 2016 was $1.5 million compared to $1.3 million for the second quarter of 2015, representing a 10% increase.
Gross profit margin (gross profit as a percentage of net sales) for the second quarter ended June 30, 2016 was 6.7% compared to 7.0% for the second quarter of 2015. Gross profit margin for our Lifeboat Distribution segment for the second quarter of 2016 was 6.2% compared to 6.3% for the second quarter of 2015. The decrease in gross profit margin for the Lifeboat Distribution segment was primarily caused by a program change by one of our main vendors, causing gross margins to decline by 1.8% for that line. Gross profit margin for our TechXtend segment for the second quarter of 2016 was 9.3% compared to 12.3% for the second quarter of 2015. The decrease in gross profit margin for the TechXtend segment was primarily caused by the increase in extended payment sales transaction which carry lower margins.
Total selling, general, and administrative ("SG&A") expenses for the second quarter of 2016 were $4.8 million compared to $4.4 million for the second quarter of 2015, representing an increase of $0.4 million or 7%. This increase is primarily the result of an increase in stock compensation and amounts accrued for bonus expense in 2016 compared to 2015. As a percentage of net sales, SG&A expenses for the second quarter of 2016 were 4.5% compared to 4.8% for the second quarter of 2015.
For the three months ended June 30, 2016, the Company recorded a provision for income taxes of $775,000 or 33.7% of income, compared to $710,000 or 34.3% of income for the same period in 2015.
Net income and diluted earnings per share for the second quarter of 2016 were $1.5 million and $0.34, respectively, compared to $1.4 million and $0.29, respectively, for the second quarter of 2015.
On July 27, 2016, the Board of Directors declared a quarterly dividend of $0.17 per share of its common stock payable August 18, 2016 to shareholders of record on August 8, 2016.
About Wayside Technology Group, Inc.
Wayside Technology Group, Inc. (NASDAQ: WSTG) was founded in 1982 and is a unified and integrated technology company providing products and solutions for corporate resellers, VARs, and developers as well as business, government and educational entities. The company offers technology products from software publishers and manufacturers including Bluebeam Software, CA Technologies, Dell/Dell Software, ExaGrid Systems, Flexera Software, Hewlett Packard, Infragistics, Intel Software, Lenovo, Micro Focus, Microsoft, Mindjet, Samsung, SmartBear Software, SolarWinds, Sophos, StorageCraft Technology, Super Micro Computer, Inc., TechSmith, Unitrends, Veeam Software and VMware.
Additional information can be found by visiting www.waysidetechnology.com
The statements in this release concerning the Company's future prospects are forward-looking statements that involve certain risks and uncertainties. Such risks and uncertainties could cause actual results to differ materially from those indicated by such forward-looking statements, and include, without limitation, the continued acceptance of the Company's distribution channel by vendors and customers, the timely availability and acceptance of new products, product mix, market conditions, contribution of key vendor relationships and support programs, as well as factors that affect the software industry in general and other factors. The forward-looking statements contained herein are also subject generally to other risks and uncertainties that are described from time to time in our filings with the Securities and Exchange Commission. Except as otherwise required by law, the Company undertakes no obligation to update or revise these forward-looking statements.
-Tables Follow -
WAYSIDE TECHNOLOGY GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands, except share and per share amounts)
June 30, December 31,
2016 2015
------------ ------------
(unaudited)
ASSETS
Current assets
Cash and cash equivalents $ 24,576 $ 23,823
Accounts receivable, net 61,763 58,965
Inventory, net 2,133 1,954
Prepaid expenses and other current assets 1,270 989
Deferred income taxes 243 260
------------ ------------
Total current assets 89,985 85,991
Equipment and leasehold improvements, net 466 362
Accounts receivable long-term 5,908 7,386
Other assets 132 82
Deferred income taxes 244 261
------------ ------------
Total assets $ 96,735 $ 94,082
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable and accrued expenses $ 58,114 $ 55,423
------------ ------------
Total current liabilities 58,114 55,423
Commitments and contingencies
Stockholders' equity
Common stock, $.01 par value; 10,000,000
shares authorized, 5,284,500 shares issued,
and 4,748,553 and 4,700,812 shares
outstanding, respectively 53 53
Additional paid-in capital 32,320 32,540
Treasury stock, at cost, 535,947 and 583,688
shares, respectively (11,118) (10,296)
Retained earnings 18,747 17,813
Accumulated other comprehensive loss (1,381) (1,451)
------------ ------------
Total stockholders' equity 38,621 38,659
------------ ------------
Total liabilities and stockholders' equity $ 96,735 $ 94,082
============ ============
WAYSIDE TECHNOLOGY GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
(Amounts in thousands, except per share data)
Six months ended Three months ended
June 30, June 30,
2016 2015 2016 2015
--------- --------- --------- ---------
(Unaudited) (Unaudited)
-------------------- --------------------
Revenues
Lifeboat segment $ 175,999 $ 164,206 $ 89,659 $ 81,260
TechXtend segment 22,581 20,456 15,598 10,710
--------- --------- --------- ---------
Total Revenue 198,580 184,662 105,257 91,970
Cost of sales
Lifeboat segment 165,300 153,862 84,112 76,150
TechXtend segment 20,328 18,018 14,145 9,395
--------- --------- --------- ---------
Total Cost of sales 185,628 171,880 98,257 85,545
--------- --------- --------- ---------
Gross Profit 12,952 12,782 7,000 6,425
Operating expenses
Selling costs 4,658 4,913 2,336 2,542
Share- based compensation 839 534 440 267
Other general and
administrative expenses 3,719 3,469 1,980 1,640
--------- --------- --------- ---------
Total Selling, general and
administrative expenses 9,216 8,916 4,756 4,449
--------- --------- --------- ---------
Income from operations 3,736 3,866 2,244 1,976
Interest income, net 125 197 61 99
Foreign currency transaction
(loss) gain (3) (5) (3) (4)
--------- --------- --------- ---------
Income before provision for
income taxes 3,858 4,058 2,302 2,071
Provision for income taxes 1,303 1,394 775 710
--------- --------- --------- ---------
Net income $ 2,555 $ 2,664 $ 1,527 $ 1,361
========= ========= ========= =========
Income per common share - Basic $ 0.56 $ 0.57 $ 0.34 $ 0.29
========= ========= ========= =========
Income per common share -
Diluted $ 0.56 $ 0.57 $ 0.34 $ 0.29
========= ========= ========= =========
Weighted average common shares
outstanding - Basic 4,545 4,665 4,524 4,640
========= ========= ========= =========
Weighted average common shares
outstanding - Diluted 4,557 4,689 4,535 4,663
========= ========= ========= =========
