Quarterly Results Were Led by Growth in ACCESSWIRE, Which Increased 6% from Q3 2021
The Company Announced the Accretive Acquisition of iNewsWire.com LLC, Doubling its News Distribution Business in Both Revenues and Customers
RALEIGH, NC / ACCESSWIRE / November 3, 2022 / Issuer Direct Corporation (NYSE American:ISDR) (the "Company"), an industry-leading communications and compliance company, today reported its operating results for the three and nine months ended September 30, 2022.
"During the third quarter our ACCESSWIRE news brand continued its year over year growth, increasing 6% over the prior year while contributing increased gross margins and enabling us to maintain our overall gross margin levels at 77%. Our sales organization has been focused on longer term contracts while maintaining or increasing our product offering prices, and we are beginning to see success in the mid-large cap public company markets from this strategy. From a corporate perspective, we also completed our previously announced $5 million stock repurchase plan early in the quarter," said Brian R. Balbirnie, Issuer Direct's founder and Chief Executive Officer.
Mr. Balbirnie continued, "During the quarter there were areas of our business that are susceptible to uncertainties in the market, specifically, our webcasting and events business saw events delayed into future periods. The news distribution industry also saw a temporary slowdown in volume during the first half of the quarter, however, rebounded to double-digit growth by the end of the quarter, a trend we believe will continue."
"Finally, and as we announced a few minutes ago this afternoon, I am also pleased to report that today we have acquired iNewsWire.com LLC, a leading communications technology company and provider of news distribution, media databases, monitoring, and newsrooms. This acquisition bolsters our press release business, almost doubling revenues and customer counts and adds a group of passionate employees to our growing roster. This acquisition enforces our commitment to scaling our Communications business as well as continue to execute our capital allocation strategy. As we have often said, making investments in our people and our business, both organically and inorganically, is extremely important for our long-term growth," stated Mr. Balbirnie.
Third Quarter 2022 Highlights:
Year-to-Date Q3 2022 Highlights:
Key Performance Indicators:
Non-GAAP Information
Certain Non-GAAP financial measures are included in this press release. In the calculation of these measures, the Company excludes certain items, such as amortization of intangible assets, stock-based compensation, tax impact of adjustments, other unusual items and discrete items impacting income tax expense. The Company believes that excluding such items provides investors and management with a representation of the Company's core operating performance and with information useful in assessing its prospects for the future and underlying trends in the Company's operating expenditures and continuing operations. Management uses such Non-GAAP measures to evaluate financial results and manage operations. The release and the attachments to this release provide a reconciliation of each of the Non-GAAP measures referred to in this release to the most directly comparable GAAP measure. The Non-GAAP financial measures are not meant to be considered a substitute for the corresponding GAAP financial statements and investors should evaluate them carefully. These Non-GAAP financial measures may differ materially from the Non-GAAP financial measures used by other companies.
RECONCILIATION OF SELECTED GAAP MEASURES TO NON-GAAP MEASURES
($ in ‘000's, except per share amounts)
CALCULATION OF EBITDA
Three Months ended September 30, | ||||||||
2022 | 2021 | |||||||
Amount | Amount | |||||||
Net income: | $ | 686 | $ | 1,024 | ||||
Adjustments: | ||||||||
Depreciation and amortization | 163 | 289 | ||||||
Interest income | (77 | ) | - | |||||
Income tax expense | 180 | 319 | ||||||
EBITDA: | $ | 952 | $ | 1,632 | ||||
Nine Months ended September 30, | ||||||||
2022 | 2021 | |||||||
Amount | Amount | |||||||
Net income: | $ | 2,043 | $ | 2,675 | ||||
Adjustments: | ||||||||
Depreciation and amortization | 487 | 854 | ||||||
Interest income | (99 | ) | (2 | ) | ||||
Income tax expense | 681 | 738 | ||||||
EBITDA: | $ | 3,112 | $ | 4,265 | ||||
CALCULATION OF NON-GAAP NET INCOME
Three Months ended September 30, | ||||||||||||||||
2022 | 2021 | |||||||||||||||
Amount | Per diluted share | Amount | Per diluted share | |||||||||||||
Net income: | $ | 686 | $ | 0.19 | $ | 1,024 | $ | 0.27 | ||||||||
Adjustments: | ||||||||||||||||
Amortization of intangible assets (1) | 108 | 0.03 | 116 | 0.03 | ||||||||||||
Stock-based compensation (2) | 187 | 0.05 | 100 | 0.03 | ||||||||||||
Other unusual items (3) | 74 | 0.02 | (366 | ) | (0.10 | ) | ||||||||||
Tax impact of adjustments (4) | (77 | ) | (0.02 | ) | 32 | 0.01 | ||||||||||
Non-GAAP net income: | $ | 978 | $ | 0.27 | $ | 906 | $ | 0.24 | ||||||||
Nine Months ended September 30, | ||||||||||||||||
2022 | 2021 | |||||||||||||||
Amount | Per diluted share | Amount | Per diluted share | |||||||||||||
Net income: | $ | 2,043 | $ | 0.55 | $ | 2,675 | $ | 0.70 | ||||||||
Adjustments: | ||||||||||||||||
Amortization of intangible assets (1) | 324 | 0.09 | 349 | 0.09 | ||||||||||||
Stock-based compensation (2) | 559 | 0.15 | 232 | 0.06 | ||||||||||||
Other unusual items (3) | 180 | 0.04 | (366 | ) | (0.10 | ) | ||||||||||
Tax impact of adjustments (4) | (223 | ) | (0.06 | ) | (45 | ) | (0.01 | ) | ||||||||
Impact of discrete items impacting income tax expense (5) | - | - | (67 | ) | (0.01 | ) | ||||||||||
Non-GAAP net income: | $ | 2,883 | $ | 0.77 | $ | 2,778 | $ | 0.73 | ||||||||
Conference Call Information
To participate in this event, dial approximately 5 to 10 minutes before the beginning of the call.
Date: | November 3, 2022 |
Time: | 4:30 p.m. eastern time |
Toll & Toll Free: | 888-506-0062 | 973-528-0011 |
Access Code: | 515746 |
Live Webcast: |
Conference Call Replay Information
The replay will be available beginning approximately 1 hour after the completion of the live event.
Toll & Toll Free: | 877-481-4010 | 919-882-2331 |
Passcode: | 46931 |
Webcast Replay & Transcript |
About Issuer Direct Corporation
Issuer Direct® is a leading communications and compliance company, providing solutions for both Public Relations and Investor Relations Professionals. Our comprehensive solutions are used by thousands of customers from emerging startups to multi-billion dollar global brands, ensuring their most important moments are reaching the right audiences, via our industry leading newswire, IR website solutions, events technology, and compliance solutions. For more information, please visit www.issuerdirect.com.
Forward-Looking Statements
This press release contains "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 (the "Exchange Act") (which Sections were adopted as part of the Private Securities Litigation Reform Act of 1995). Statements preceded by, followed by or that otherwise include the words "believe," "anticipate," "estimate," "expect," "intend," "plan," "project," "prospects," "outlook," and similar words or expressions, or future or conditional verbs, such as "will," "should," "would," "may," and "could," are generally forward-looking in nature and not historical facts. These forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the Company's actual results, performance, or achievements to be materially different from any anticipated results, performance, or achievements for many reasons including the impact of the coronavirus pandemic. The Company disclaims any intention to, and undertakes no obligation to, revise any forward-looking statements, whether as a result of new information, a future event, or otherwise. For additional risks and uncertainties that could impact the Company's forward-looking statements, please see the Company's Annual Report on Form 10-K for the year ended December 31, 2021, including but not limited to the discussion under "Risk Factors" therein, which the Company filed with the SEC and which may be viewed at http://www.sec.gov/.
For Further Information:
Issuer Direct Corporation
Brian R. Balbirnie
(919)-481-4000
brian.balbirnie@issuerdirect.com
Hayden IR
Brett Maas
(646)-536-7331
brett@haydenir.com
Hayden IR
James Carbonara
(646)-755-7412
james@haydenir.com
ISSUER DIRECT CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share amounts)
September 30, | December 31, | |||||||
2022 | 2021 | |||||||
ASSETS | (unaudited) | |||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 21,812 | $ | 23,852 | ||||
Accounts receivable (net of allowance for doubtful accounts of $610 and $675, respectively) | 3,062 | 3,291 | ||||||
Income tax receivable | 285 | - | ||||||
Other current assets | 807 | 750 | ||||||
Total current assets | 25,966 | 27,893 | ||||||
Capitalized software (net of accumulated amortization of $3,349 and $3,301, respectively) | 153 | 201 | ||||||
Fixed assets (net of accumulated depreciation of $572 and $456, respectively) | 649 | 713 | ||||||
Right-of-use asset - leases | 1,341 | 1,533 | ||||||
Other long-term assets | 110 | 94 | ||||||
Goodwill | 6,376 | 6,376 | ||||||
Intangible assets (net of accumulated amortization of $6,329 and $6,005, respectively) | 2,123 | 2,447 | ||||||
Total assets | $ | 36,718 | $ | 39,257 | ||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 691 | $ | 695 | ||||
Accrued expenses | 1,638 | 1,975 | ||||||
Income taxes payable | 198 | 46 | ||||||
Deferred revenue | 3,429 | 3,086 | ||||||
Total current liabilities | 5,956 | 5,802 | ||||||
Deferred income tax liability | 96 | 176 | ||||||
Lease liabilities - long-term | 1,422 | 1,659 | ||||||
Total liabilities | 7,474 | 7,637 | ||||||
Commitments and contingencies | ||||||||
Stockholders' equity: | ||||||||
Preferred stock, $0.001 par value, 1,000,000 shares authorized, no shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively. | - | - | ||||||
Common stock $0.001 par value, 20,000,000 shares authorized, 3,610,839 and 3,793,538 shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively. | 4 | 4 | ||||||
Additional paid-in capital | 18,051 | 22,401 | ||||||
Other accumulated comprehensive loss | (88 | ) | (19 | ) | ||||
Retained earnings | 11,277 | 9,234 | ||||||
Total stockholders' equity | 29,244 | 31,620 | ||||||
Total liabilities and stockholders' equity | $ | 36,718 | $ | 39,257 | ||||
ISSUER DIRECT CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(in thousands, except share and per share amounts)
For the Three Months Ended | For the Nine Months Ended | |||||||||||||||
September 30, | September 30, | September 30, | September 30, | |||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||
Revenues | $ | 5,280 | $ | 5,465 | $ | 16,375 | $ | 16,165 | ||||||||
Cost of revenues | 1,212 | 1,355 | 3,808 | 4,229 | ||||||||||||
Gross profit | 4,068 | 4,110 | 12,567 | 11,936 | ||||||||||||
Operating costs and expenses: | ||||||||||||||||
General and administrative | 1,657 | 1,258 | 4,903 | 3,923 | ||||||||||||
Sales and marketing expenses | 1,231 | 1,349 | 3,866 | 3,633 | ||||||||||||
Product development | 245 | 373 | 734 | 878 | ||||||||||||
Depreciation and amortization | 146 | 153 | 439 | 457 | ||||||||||||
Total operating costs and expenses | 3,279 | 3,133 | 9,942 | 8,891 | ||||||||||||
Operating income | 789 | 977 | 2,625 | 3,045 | ||||||||||||
Other income | - | 366 | - | 366 | ||||||||||||
Interest income | 77 | - | 99 | 2 | ||||||||||||
Income before taxes | 866 | 1,343 | 2,724 | 3,413 | ||||||||||||
Income tax expense | 180 | 319 | 681 | 738 | ||||||||||||
Net income | $ | 686 | $ | 1,024 | $ | 2,043 | $ | 2,675 | ||||||||
Income per share - basic | $ | 0.19 | $ | 0.27 | $ | 0.55 | $ | 0.71 | ||||||||
Income per share - fully diluted | $ | 0.19 | $ | 0.27 | $ | 0.55 | $ | 0.70 | ||||||||
Weighted average number of common shares outstanding - basic | 3,618 | 3,788 | 3,717 | 3,776 | ||||||||||||
Weighted average number of common shares outstanding - fully diluted | 3,636 | 3,821 | 3,738 | 3,818 | ||||||||||||
ISSUER DIRECT CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(in thousands)
For the Nine Months Ended | ||||||||
September 30, | September 30, | |||||||
2022 | 2021 | |||||||
Cash flows from operating activities: | ||||||||
Net income | $ | 2,043 | $ | 2,675 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 487 | 854 | ||||||
Bad debt expense | 279 | 236 | ||||||
Deferred income taxes | (80 | ) | (14 | ) | ||||
Stock-based compensation expense | 559 | 232 | ||||||
Changes in operating assets and liabilities: | ||||||||
Decrease (increase) in accounts receivable | (61 | ) | (767 | ) | ||||
Decrease (increase) in other assets | (166 | ) | (273 | ) | ||||
Increase (decrease) in accounts payable | (2 | ) | 365 | |||||
Increase (decrease) in accrued expenses | (409 | ) | (489 | ) | ||||
Increase (decrease) in deferred revenue | 375 | 500 | ||||||
Net cash provided by operating activities | 3,025 | 3,319 | ||||||
Cash flows from investing activities: | ||||||||
Capitalized software | - | (215 | ) | |||||
Purchase of fixed assets | (52 | ) | (49 | ) | ||||
Net cash used in investing activities | (52 | ) | (264 | ) | ||||
Cash flows from financing activities: | ||||||||
Exercise of stock options | 91 | 274 | ||||||
Payment for stock repurchase and retirement | (5,000 | ) | (452 | ) | ||||
Net cash used in financing activities | (4,909 | ) | (178 | ) | ||||
Net change in cash and cash equivalents | (1,936 | ) | 2,877 | |||||
Cash - beginning | 23,852 | 19,556 | ||||||
Currency translation adjustment | (104 | ) | (18 | ) | ||||
Cash and cash equivalents - ending | $ | 21,812 | $ | 22,415 | ||||
Supplemental disclosures: | ||||||||
Cash paid for income taxes | $ | 782 | $ | 893 | ||||
SOURCE : Issuer Direct Corporation