- Recurring Revenues now total more
than 24% of Restaurant/Retail Business
- Government Segment Reports Record Q1
Profits
PAR Technology Corporation (NYSE: PAR) a leading provider of
restaurant/retail management systems and Government contract
services today announced results for the first quarter ended March
31, 2016.
Summary of Fiscal 2016 First Quarter Financial Results
From Continuing Operations
- Revenue reported at $55.3 million,
compared to $55.2 million in the first quarter of 2015
- GAAP net income from continuing
operations in the first quarter of fiscal 2016 was $15,000, or
$0.00 per diluted share, compared to net income from continuing
operations of $192,000, or $0.01 earnings per share for the same
period in 2015
- Adjusted non-GAAP net income from
continuing operations was $925,000 or $0.06 per diluted share,
compared to adjusted non-GAAP net income from continuing operations
of $634,000 or $0.04 per diluted share, in the same period last
year
A reconciliation and description of GAAP financial measures to
their comparable non-GAAP financial measures are included in the
tables following this news release.
“In the first quarter our Company again saw steady growth in our
restaurant and retail technology revenues reflected by the 8%
increase over Q1 2015. Our Government revenues were lower in the
quarter due to the timing of specific contract startups and lower
task orders, but we were still able to report the highest Q1 profit
in our Company’s history for this segment,” commented Karen E.
Sammon, President & CEO of PAR Technology. “We made real
progress in the quarter as we realized strong double digit growth
in our SaaS revenues as we consistently add new “cloud” customers
with our Brink and SureCheck solutions. Simultaneously we continue
to grow our Tier 1 business and announced Jack-in-the-Box as a new
customer in the quarter. We are creating a strong foundation that
will enable us to deliver greater shareholder value in the
future.”
There will be a conference call at 4:45 p.m. eastern time on May
3, 2016, during which the Company’s management will discuss the
financial results for the first quarter of 2016. If you would like
to participate in this conference, please call (866)
868-9502 approximately 10 minutes before the call is scheduled
to begin. No passcode is required to participate in the live the
call. Individual & Institutional Investors will have the
opportunity to listen to the conference call/event over the
Internet. Individual Investors can listen to the call by visiting
PAR’s website at www.partech.com. Alternatively, listeners may
access an archived version of the conference call after 6:00 p.m.
ET on May 3, 2016 through May 10, 2016 by dialing 855-859-2056 and
using conference ID 95359526 and also by accessing the link on
PAR’s website.
About PAR Technology Corporation
PAR Technology Corporation's stock is traded on the New York
Stock Exchange under the symbol PAR. PAR’s Hospitality segment has
been a leading provider of restaurant and retail technology for
more than 35 years and offers technology solutions for the full
spectrum of restaurant operations, from large global quick service
chains and table service restaurants to fast casual and independent
operators. PAR’s products can be found in retailers, cinemas,
cruise lines, stadiums and food service companies. PAR’s Government
Business is a leader in providing computer-based system design,
engineering and mission services to the Department of Defense and
various federal agencies. For more information visit
www.partech.com or connect with PAR on Facebook at
www.facebook.com/parpointofsale or Twitter at
www.twitter.com/Par_tech .
Certain Company information in this release or statements made
by its spokespersons from time to time may contain forward-looking
statements. Any statements in this document that do not describe
historical facts are forward-looking statements. Forward-looking
statements are made pursuant to the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995. Investors are
cautioned that all forward-looking statements involve risks and
uncertainties, including without limitation, delays in new product
introduction, risks in technology development and
commercialization, risks in product development and market
acceptance of and demand for the Company’s products, risks of
downturns in economic conditions generally, and in the quick
service sector of the restaurant market specifically, risks of
intellectual property rights associated with competition and
competitive pricing pressures, risks associated with foreign sales
and high customer concentration, and other risks detailed in the
Company’s filings with the Securities and Exchange Commission.
PAR TECHNOLOGY CORPORATION
CONSOLIDATED BALANCE SHEETS
(in thousands, except share amounts)
(Unaudited)
March 31, December 31,
Assets 2016 2015 Current assets:
Cash and cash equivalents
$ 5,770 $ 8,024 Accounts receivable-net 33,972 29,530
Inventories-net 22,376 21,499 Income taxes receivable 73 - Deferred
income taxes 6,810 6,741 Other current assets 3,582
3,808 Total current assets 72,583 69,602 Property,
plant and equipment - net 5,724 5,716 Note receivable 3,387 3,320
Deferred income taxes 11,038 11,038 Goodwill 11,051 11,051
Intangible assets - net 11,053 10,898 Other assets 3,780
3,687
Total Assets $ 118,616 $
115,312
Liabilities and Shareholders’ Equity Current
liabilities: Current portion of long-term debt $ 2,130 $ 2,103
Accounts payable 15,256 11,729 Accrued salaries and benefits 5,285
5,727 Accrued expenses 6,910 6,705 Customer deposits and deferred
service revenue 11,478 10,819 Income taxes payable - 279
Liabilities of discontinued operations 280 441
Total current liabilities 41,339 37,803 Long-term debt 521
566 Other long-term liabilities 8,701 8,883
Total liabilities 50,561 47,252
Commitments and contingencies Shareholders’ Equity: Preferred
stock, $.02 par value, 1,000,000 shares authorized - - Common
stock, $.02 par value, 29,000,000 shares authorized; 17,314,960 and
17,352,838 shares issued; 15,606,851 and 15,644,729 outstanding at
March 31, 2016 and December 31, 2015, respectively 346 347 Capital
in excess of par value 45,856 45,753 Retained earnings 30,589
30,574 Accumulated other comprehensive loss (2,900 ) (2,778 )
Treasury stock, at cost, 1,708,109 shares (5,836 )
(5,836 ) Total shareholders’ equity 68,055
68,060
Total Liabilities and Shareholders’ Equity $
118,616 $ 115,312
PAR TECHNOLOGY CORPORATION
CONSOLIDATED STATEMENTS OF
OPERATIONS
(in thousands, except per share
amounts)
(Unaudited)
For the three months endedMarch 31,
2016
2015 Net revenues: Product $ 22,084 $ 20,745 Service 11,704
10,637 Contract 21,517 23,836
55,305 55,218 Costs of sales: Product 16,442
14,713 Service 8,599 8,033 Contract 19,655
22,474 44,696 45,220 Gross
margin 10,609 9,998 Operating expenses:
Selling, general and administrative 7,542 6,660 Research and
development 2,762 2,434 Amortization of identifiable intangible
assets 241 249 10,545
9,343 Operating income from continuing operations 64
655 Other expense, net (70 ) (206 ) Interest income (expense), net
29 (86 ) Income from continuing operations
before provision for income taxes 23 363 Provision for income taxes
(8 ) (171 ) Income from continuing operations 15 192
Discontinued Operations Loss on discontinued operations, (net of
tax) 0 (577 ) Net income (loss) $ 15 $
(385 ) Basic Earnings per Share: Income from continuing operations
0.00 0.01 Loss from discontinued operations 0.00
(0.04 ) Net income (loss) $ 0.00 $ (0.02 ) Diluted
Earnings per Share: Income from continuing operations 0.00 0.01
Loss from discontinued operations 0.00 (0.04 )
Net income (loss) $ 0.00 $ (0.02 ) Weighted average
shares outstanding Basic 15,646 15,596
Diluted 15,723 15,710
The Company reports its financial results in accordance with
GAAP, which refers financial information presented in accordance
with generally accepted accounting principles in the United States.
However, non-GAAP adjusted financial measures, as defined in the
reconciliation table above, are provided herein because management
uses such measures in evaluating the results of the continuing
operations of the Company and believes this information provides
investors better insight into underlying business trends and
performance. Non-GAAP financial measures should be viewed in
addition to, and not as an alternative for, the Company's reported
results prepared in accordance with GAAP.
PAR's results of operations are impacted by certain items which
include severance charges from restructuring business operations,
equity based compensation, acquisition related expenditures, and
other one-time charges that are should not be considered in
analyzing the trends of the business. Management believes that
adjusting its operating expenses, operating income, net earnings
and diluted earnings per share to remove these certain items
provides an important perspective with respect to our results and
provides meaningful supplemental information to both management and
investors that removes these items which are difficult to predict
and are often unanticipated, and which, as a result are difficult
to include in analyst's financial models and our investors'
expectations with any degree of specificity. PAR believes the
adjusted totals facilitate comparison on a year-over-year
basis.
PAR's results of operations are further impacted by costs from
its multi-year Business Transformation Project. Management believes
that further adjusting its operating expenses, operating income,
net earnings and diluted earnings per share to remove the impact of
the Business Transformation Project expenses provides an important
perspective with respect to underlying business trends and results
and provides meaningful supplemental information to both management
and investors that is indicative of the performance of the
company's underlying operations and facilitates comparison on a
year-over-year basis.
The company uses these non-GAAP measures when evaluating its
financial results as well as for internal planning and forecasting
purposes. These financial measures should not be used as a
substitute in assessing the company's results of operations for the
periods presented. An analysis of any non-GAAP financial measure
should be used in conjunction with results presented in accordance
with GAAP. As a result, in the tables that follow, each period
presented is adjusted to remove the certain items noted above. Each
period has been further adjusted to remove expenses related to the
Business Transformation Project.
PAR TECHNOLOGY CORPORATION RECONCILIATION OF GAAP TO
NON-GAAP FINANCIAL MEASURES (in thousands, except per share
data) (Unaudited) For the
three months ended March 31, 2016 For the three months ended March
31, 2015
Reportedbasis (GAAP)
Adjustments
Comparablebasis (Non-GAAP)
Reported basis(GAAP)
Adjustments
Comparablebasis (Non-GAAP)
Net revenues $ 55,305 - $ 55,305 $ 55,218 - $ 55,218 Costs
of sales 44,696 - 44,696
45,220 66 45,154 Gross
Margin 10,609 - 10,609 9,998 66 10,064 Operating Expenses
Selling, general and administrative 7,542 1,177 6,365 6,660 360
6,300 Research and development 2,762 - 2,762 2,434 - 2,434
Amortization of indentifiableintangible
assets
241 241 - 249
249 - 10,545 1,418 9,127 9,343
609 8,734
Operating income from
continuingoperations
64 1,418 1,482 655 675 1,330 Other expense, net (70 ) - (70 ) (206
) - (206 ) Interest income (expense), net 29
26 55 (86 ) 26 (60
)
Income from continuing operationsbefore
provision for income taxes
23 1,444 1,467 363 701 1,064 Provision for income taxes (8 )
(534 ) (542 ) (171 ) (259 ) (430
) Income from continuing operations $ 15 $ 910 $ 925
$ 192 $ 442 $ 634
Loss from discontinued operations,(net of
tax)
$ 0 $ 0 $ (577 ) $ (577 ) Net income (loss) $ 15
$ 925 $ (385 ) $ 57
Income per diluted share fromcontinuing
operations
$ 0.00 $ 0.06 $ 0.01 $ 0.04
Loss per share from
discontinuingoperations
$ 0.00 $ 0.00 $ (0.04 ) $ (0.04 ) Income (loss) per
diluted share $ 0.00 $ 0.06 $ (0.02 ) $ 0.00
During the first quarter of 2016, the Company recorded charges
of $766,000 of investigation costs related to certain unauthorized
transfers of Company funds that were made in contravention of the
Company’s policies and procedures, $345,000 related to the initial
phase of the planned implementation of a new enterprise resource
system in connection with the Business Transformation Project and
equity based compensation charges of $66,000. Lastly, related to
the acquisition of Brink, the Company recognized amortization of
acquired intangible assets of $241,000 and accreted interest of
$26,000. During the first quarter of 2015, the Company recorded
severance and other related charges of $181,000, of which $66,000
is included in cost of sales and $115,000 is included in selling,
general and administrative. Also included within selling, general
and administrative is equity based compensation charges of
$245,000. Lastly, related to the acquisition of Brink, the Company
recognized amortization of acquired intangible assets of $249,000
and accreted interest of $26,000. The aforementioned charges, along
with an associated adjustment to the Company’s provision for income
taxes have been excluded in the Company’s non-GAAP measures because
they are considered non-recurring in nature and are quantitatively
and qualitatively different from the Company’s core operations
during any particular period.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20160503006937/en/
PAR Technology CorporationChristopher R. Byrnes, (315) 738-0600
ext. 6226cbyrnes@partech.comwww.partech.com
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