SITO Mobile Reports First Quarter 2016 Financial Results
Quarterly Revenue of $7.2 Million Grows 87% Year-Over-Year and 60% Sequentially
JERSEY CITY, N.J., Feb. 09, 2016 (GLOBE NEWSWIRE) -- SITO Mobile Ltd. (NASDAQ:SITO), a leading mobile engagement platform, today announced results for its fiscal first quarter ended December 31, 2015.
First Quarter 2016 Business Highlights
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TOTAL REVENUE: Total revenue was $7.2 million, an increase of 87% year-over-year and 60% sequentially.
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MEDIA PLACEMENT REVENUE: Media Placement revenue (SITO Mobile’s programmatic advertising revenue) was $5.3 million, more than triple year-over-year and an increase of 77% sequentially over Q4 2015.
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WIRELESS APPLICATIONS REVENUE: Wireless Applications Revenue (SITO Mobile’s SMS Revenue) was $1.6 million, an increase of 20% sequentially.
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ADJUSTED EBITDA: SITO produced approximately $677,000 in Adjusted EBITDA compared with approximately ($764,000) Adjusted EBITDA loss in Q4 2015.
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GROSS PROFIT: Gross Profit was $3.8 million (52% gross margin) in Q1 2016, up from $2.4 million (52% gross margin) in Q4 2015 and up from $2 million (52% Gross Margin) in Q1 2015. (Please refer to the supplemental schedule below for calculation of Gross Profit and Gross Margin)
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CASH AND CASH EQUIVALENTS: Cash on hand was approximately $2.6 million at the end of Q1 – an increase of approximately $600,000 from Q4.
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INTERNATIONAL EXPANSION: Providing greater revenue visibility, SITO formalized its partnership in the Canadian market, with a commitment from Cieslok Media to deliver a minimum of $2.1 million in Media Placement revenue in calendar year 2016.
“We’re off to a great start in 2016,” said Jerry Hug, CEO of SITO Mobile. “Our performance was driven by increasing momentum in our Media Placement business and during the holiday season we saw increased demand for our proprietary mobile location-based Verified Walk-In product which continues to deliver excellent ROI to advertisers. As we look ahead, we are encouraged by SITO’s continued revenue momentum and operating leverage and we expect to produce increasing positive EBITDA in the full year of 2016 as we continue to execute on our plan.”
Conference Call Information
Date: Tuesday, February 9, 2016
Time: 4:30 P.M. Eastern Time (ET)
Dial in Number for U.S. & Canadian Callers: 877-407-8293
Dial in Number for International Callers (Outside of the U.S. & Canada): 201-689-8349
Participating on the call will be SITO Mobile's Chief Executive Officer Jerry Hug and Chief Financial Officer Kurt Streams. To join the live conference call, please dial into the above referenced telephone numbers five to ten minutes prior to the scheduled conference call time.
A replay will be available for 2 weeks starting on February 9, 2016 at approximately 8:00 P.M. ET. To access the replay, please dial 877-660-6853 in the U.S. and 201-612-7415 for international callers. The conference ID# is 13629834.
About SITO Mobile Ltd.
SITO Mobile provides a mobile engagement platform that enables brands to increase awareness, loyalty, and ultimately sales. For more information, visit www.sitomobile.com.
Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, sales growth, our reliance on brand owners and wireless carriers, the possible need for additional capital as well other risks identified in our filings with the SEC. Any forward-looking statement made by us in this press release is based only on information currently available to us and speaks only as of the date on which it is made. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.
[FINANCIAL TABLES TO FOLLOW]
| SITO Mobile, Ltd. | ||||||||
| UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||
| For the Three Months Ended | ||||||||
| December 31, | ||||||||
| 2015 | 2014 | |||||||
| Revenue | ||||||||
| Wireless applications | $ | 1,622,325 | $ | 2,424,766 | ||||
| Licensing and royalties | 245,328 | 133,581 | ||||||
| Media placement | 5,345,470 | 1,289,089 | ||||||
| Total Revenue | 7,213,123 | 3,847,436 | ||||||
| Costs and Expenses | ||||||||
| Cost of revenue (including $219,776 and $123,547 in amortization expense for the three months ended December 31, 2015 and 2014, respectively) | 3,449,256 | 1,848,187 | ||||||
| Sales and marketing | 1,877,339 | 672,071 | ||||||
| General and administrative | 1,583,583 | 1,380,854 | ||||||
| Depreciation and amortization | 219,225 | 65,197 | ||||||
| Total costs and expenses | 7,129,403 | 3,966,309 | ||||||
| Income (Loss) from operations | 83,720 | (118,873 | ) | |||||
| Other Expense | ||||||||
| Interest expense | (471,799 | ) | (417,378 | ) | ||||
| Net loss before income taxes | (388,079 | ) | (536,251 | ) | ||||
| Provision for income taxes | - | - | ||||||
| Net loss | $ | (388,079 | ) | $ | (536,251 | ) | ||
| Basic and diluted loss per share | $ | (0.02 | ) | $ | (0.03 | ) | ||
| Weighted average shares outstanding | 17,155,478 | 15,326,275 | ||||||
Non-GAAP Financial Measures
This press release uses Adjusted EBITDA, a non-GAAP financial measure. Adjusted EBITDA should not be considered a replacement for, and should be read together with, the most comparable GAAP financial measure, which is Operating Profit (Loss). A reconciliation of Adjusted EBITDA to Operating Profit (Loss) is included herein.
To supplement our financial results and guidance presented in accordance with U.S. generally accepted accounting principles (GAAP), the Company uses certain non-GAAP financial measures in this press release, including EBITDA. The Company believes that non-GAAP financial measures are helpful in understanding its past financial performance and potential future results, particularly in light of the effect of various acquisition transactions effected by the Company. Non-GAAP financial measures are not meant to be considered in isolation or as a substitute for or superior to comparable GAAP measures and should be read in conjunction with the consolidated financial statements prepared in accordance with GAAP.
Management excludes stock based compensation expense because they believe that the non-GAAP financial measures excluding this item provide meaningful supplemental information regarding operational performance. In particular, because of varying available valuation methodologies, subjective assumptions and the variety of award types that companies can use under FASB ASC 718, we believe that providing non-GAAP financial measures that exclude this expense allows investors to make more meaningful comparisons between our operating results and those of other companies. Accordingly, management believes that excluding this expense provides investors and management with greater visibility to the underlying performance of our business operations, facilitates comparison of our results with other periods, and may also facilitate comparison with the results of other companies in our industry. Management uses Adjusted EBITDA in managing and analyzing its business and financial condition. Management believes that the presentation of non-GAAP financial measures provides investors greater transparency into ongoing results of operations allowing investors to better compare the Company's results from period to period.
| SITO Mobile, Ltd. | ||||||||
| Non-GAAP Financial Measures | For the Three Months Ended | |||||||
| December 31, | ||||||||
| 2015 | 2014 | |||||||
| Net Loss | $ | (388,079 | ) | $ | (536,251 | ) | ||
| Adjustments to reconcile net loss to EBITDA: | ||||||||
| Depreciation and amortization expense included in costs and expenses: | ||||||||
| Amortization included in cost of revenue | 219,776 | 123,547 | ||||||
| Depreciation and other amortization | 219,225 | 65,197 | ||||||
| Total depreciation and amortization expense | 439,001 | 188,744 | ||||||
| Interest expense | 471,799 | 417,378 | ||||||
| Provision for income taxes | - | - | ||||||
| EBITDA | $ | 522,721 | $ | 69,871 | ||||
| Adjustments to reconcile EBITDA: | ||||||||
| Stock based compensation expense included in costs and expenses: | ||||||||
| Sales and marketing | 67,519 | 8,085 | ||||||
| General and administrative | 86,409 | 172,729 | ||||||
| Total stock based compensation expense | 153,928 | 180,814 | ||||||
| Adjusted EBITDA | $ | 676,649 | $ | 250,685 | ||||
| SITO Mobile, Ltd. | ||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
| December 31, | September 30, | |||||||
| 2015 | 2015 | |||||||
| (Unaudited) | ||||||||
| Assets | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | 2,615,184 | $ | 2,004,139 | ||||
| Accounts receivable, net - current portion | 6,273,838 | 4,265,481 | ||||||
| Other prepaid expenses | 123,692 | 312,606 | ||||||
| Total current assets | 9,012,714 | 6,582,226 | ||||||
| Property and equipment, net | 585,356 | 610,161 | ||||||
| Other assets | ||||||||
| Accounts receivable, net | - | 225,000 | ||||||
| Capitalized software development costs, net | 1,600,813 | 1,403,397 | ||||||
| Intangible assets: | ||||||||
| Patents | 445,473 | 493,952 | ||||||
| Patent applications cost | 897,087 | 826,074 | ||||||
| Other intangible assets, net | 1,714,477 | 1,837,227 | ||||||
| Goodwill | 6,444,225 | 6,444,225 | ||||||
| Deferred loan costs, net | 78,116 | 92,842 | ||||||
| Other assets including security deposits | 84,829 | 83,576 | ||||||
| Total other assets | 11,265,020 | 11,406,293 | ||||||
| Total assets | $ | 20,863,090 | $ | 18,598,680 | ||||
| SITO Mobile, Ltd. | ||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
| December 31, | September 30, | |||||||
| 2015 | 2015 | |||||||
| (Unaudited) | ||||||||
| Liabilities and Stockholders' Equity | ||||||||
| Current liabilities | ||||||||
| Accounts payable | $ | 4,885,600 | $ | 2,339,189 | ||||
| Accrued expenses | 1,181,373 | 809,081 | ||||||
| Accrued compensation - related party | 96,523 | 253,016 | ||||||
| Deferred revenue | 532,909 | 595,669 | ||||||
| Current obligation under capital lease | 11,699 | 15,858 | ||||||
| Note payable, net - current portion | 3,984,219 | 3,575,024 | ||||||
| Total current liabilities | 10,692,323 | 7,587,837 | ||||||
| Long-term liabilities | ||||||||
| Obligations under capital lease | 6,201 | 7,023 | ||||||
| Note payable | 4,934,966 | 5,690,124 | ||||||
| Total long-term liabilities | 4,941,167 | 5,697,147 | ||||||
| Total liabilities | 15,633,490 | 13,284,984 | ||||||
| Stockholders' Equity | ||||||||
| Preferred stock, $.0001 par value, 5,000,000 shares authorized; none outstanding | - | - | ||||||
| Common stock, $.001 par value; 300,000,000 shares authorized, 17,155,478 shares issued and outstanding as of December 31, 2015 and as of September 30, 2015, respectively | 17,156 | 17,156 | ||||||
| Additional paid-in capital | 144,538,247 | 144,234,264 | ||||||
| Accumulated deficit | (139,325,803 | ) | (138,937,724 | ) | ||||
| Total stockholders' equity | 5,229,600 | 5,313,696 | ||||||
| Total liabilities and stockholders' equity | $ | 20,863,090 | $ | 18,598,680 | ||||
| SITO Mobile, Ltd. | ||||||||
| UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||
| For the Three Months Ended | ||||||||
| December 31, | ||||||||
| 2015 | 2014 | |||||||
| Cash Flows from Operating Activities | ||||||||
| Net loss | $ | (388,079 | ) | $ | (536,251 | ) | ||
| Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||||||||
| Depreciation expense | 47,996 | 24,174 | ||||||
| Amortization expense - software development costs | 219,776 | 123,547 | ||||||
| Amortization expense - patents | 48,479 | 41,023 | ||||||
| Amortization expense - discount of debt | 168,516 | 128,897 | ||||||
| Amortization expense - deferred costs | 14,726 | 11,264 | ||||||
| Amortization expense - intangible assets | 122,750 | - | ||||||
| Loss on disposition of assets | - | 2,950 | ||||||
| Stock based compensation | 153,928 | 180,814 | ||||||
| Changes in operating assets and liabilities: | ||||||||
| (Increase) in accounts receivable, net | (1,783,357 | ) | (715,649 | ) | ||||
| Decrease in prepaid expenses | 188,914 | 67,078 | ||||||
| (Increase) in other assets | (1,253 | ) | (50,655 | ) | ||||
| Increase in accounts payable | 2,546,411 | 737,907 | ||||||
| Increase (decrease) in accrued expenses | 215,799 | (119,839 | ) | |||||
| (Decrease) Increase in deferred revenue | (62,760 | ) | 374,067 | |||||
| Increase (decrease) in accrued interest | 152,189 | (506,031 | ) | |||||
| Net cash provided by (used in) operating activities | 1,644,035 | (236,704 | ) | |||||
| Cash Flows from Investing Activities | ||||||||
| Patents and patent applications costs | (71,013 | ) | (119,067 | ) | ||||
| Purchase of property and equipment | (23,191 | ) | (21,843 | ) | ||||
| Capitalized software development costs | (417,192 | ) | (246,791 | ) | ||||
| Net cash used in investing activities | $ | (511,396 | ) | $ | (387,701 | ) | ||
| SITO Mobile, Ltd. | ||||||||
| UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||
| For the Three Months Ended | ||||||||
| December 31, | ||||||||
| 2015 | 2014 | |||||||
| Cash Flows from Financing Activities | ||||||||
| Proceeds from issuance of common stock | $ | 150,055 | $ | 1,000,000 | ||||
| Proceeds from issuance of note payable | - | 8,205,816 | ||||||
| Principal reduction on obligation under capital lease | (4,981 | ) | (4,924 | ) | ||||
| Principal reduction on issuance of debt | (666,668 | ) | - | |||||
| Principal reduction on convertible debt | - | (3,708,000 | ) | |||||
| Net cash (used in) provided by financing activities | (521,594 | ) | 5,492,892 | |||||
| Net increase in cash and cash equivalents | 611,045 | 4,868,487 | ||||||
| Cash and cash equivalents – Beginning of period | 2,004,139 | 620,185 | ||||||
| Cash and cash equivalents – Ending of period | $ | 2,615,184 | $ | 5,488,672 | ||||
| Supplemental Information: | ||||||||
| Interest expense paid | $ | 136,369 | $ | 781,143 | ||||
| Income taxes paid | $ | - | $ | - | ||||
| SITO Mobile, Ltd. | ||||||||||||||||||||||||||||||||||||||||||||
| Supplemental Schedule | ||||||||||||||||||||||||||||||||||||||||||||
| Amounts in thousands except percentages | ||||||||||||||||||||||||||||||||||||||||||||
| December 31, | ||||||||||||||||||||||||||||||||||||||||||||
| December 31, 2014 | March 31, 2015 | June 30, 2015 | September 30, 2015 | Fiscal Year 2015 | 2015 | |||||||||||||||||||||||||||||||||||||||
| Reported | Adjusted | Reported | Adjusted | Reported | Adjusted | Reported | Adjusted | Reported | Adjusted | Reported | ||||||||||||||||||||||||||||||||||
| Revenue | ||||||||||||||||||||||||||||||||||||||||||||
| Wireless applications | 2,425 | 2,425 | 2,004 | 2,004 | 1,387 | 1,387 | 1,347 | 1,347 | 7,163 | 7,163 | 1,622 | |||||||||||||||||||||||||||||||||
| Licensing and royalties | 134 | 134 | 135 | 135 | 140 | 140 | 144 | 144 | 553 | 553 | 245 | |||||||||||||||||||||||||||||||||
| Media placement | 1,289 | 1,289 | 1,628 | 1,628 | 2,154 | 2,154 | 3,023 | 3,023 | 8,094 | 8,094 | 5,345 | |||||||||||||||||||||||||||||||||
| Total Revenue | 3,848 | 3,848 | 3,767 | 3,767 | 3,681 | 3,681 | 4,514 | 4,514 | 15,810 | 15,810 | 7,212 | |||||||||||||||||||||||||||||||||
| Cost of Revenue | 1,820 | 1,848 | 1,580 | 1,644 | 1,445 | 1,807 | 1,513 | 2,164 | 6,358 | 7,463 | 3,449 | |||||||||||||||||||||||||||||||||
| Gross Profit | 2,028 | 2,000 | 2,187 | 2,123 | 2,236 | 1,874 | 3,001 | 2,350 | 9,452 | 8,347 | 3,763 | |||||||||||||||||||||||||||||||||
| Gross Margin | 53 | % | 52 | % | 58 | % | 56 | % | 61 | % | 51 | % | 66 | % | 52 | % | 59 | % | 53 | % | 52 | % | ||||||||||||||||||||||
| Operating Expenses | ||||||||||||||||||||||||||||||||||||||||||||
| General and administrative | 1,371 | 1,381 | 1,155 | 1,164 | 1,459 | 1,474 | 2,241 | 2,254 | 6,226 | 6,273 | 1,584 | |||||||||||||||||||||||||||||||||
| Sales and marketing | 700 | 672 | 912 | 848 | 1,268 | 906 | 1,849 | 1,198 | 4,729 | 3,624 | 1,877 | |||||||||||||||||||||||||||||||||
| Research and development | 10 | - | 9 | - | 15 | - | 13 | - | 47 | - | - | |||||||||||||||||||||||||||||||||
| Loss on impairment of long-lived asset | - | - | - | - | - | - | 831 | 831 | 831 | 831 | - | |||||||||||||||||||||||||||||||||
| Depreciation and amortization | 65 | 65 | 68 | 68 | 77 | 77 | 209 | 209 | 419 | 419 | 219 | |||||||||||||||||||||||||||||||||
| Total Operating Expenses | 2,146 | 2,118 | 2,144 | 2,080 | 2,819 | 2,457 | 5,143 | 4,492 | 12,252 | 11,147 | 3,680 | |||||||||||||||||||||||||||||||||
| Income (Loss) from Operations | (118 | ) | (118 | ) | 43 | 43 | (583 | ) | (583 | ) | (2,142 | ) | (2,142 | ) | (2,800 | ) | (2,800 | ) | 83 | |||||||||||||||||||||||||
Note: Certain reclassifications have been made to conform the fiscal 2015 quarterly amounts to the fiscal 2016 classifications for comparative purposes. The Company is reporting a vendor cost in cost or revenue that had been previously reported in sales and marketing expense and is reporting research and development cost in general and administrative expense. The changes are only expense reclassifications and do not affect revenue, total costs and revenues, income (loss) from operations, net income or any balance sheet accounts. Amounts affected by the reclassification are shown in bold in the table above.
Contact: Investor Relations: Joseph Wilkinson SVP Investor Relations Joseph.Wilkinson@sitomobile.com Media Relations: Matthew Bretzius FischTank Marketing and PR matt@fischtankpr.com SOURCE SITO Mobile RELATED LINKS http://www.sitomobile.com
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