LOUISVILLE, Ky., May 9, 2019 /PRNewswire/ -- Creative Realities,
Inc. ("Creative Realities," "CRI," or the "Company") (NASDAQ: CREX,
CREXW), a leading provider of digital marketing solutions,
announced its financial results for the quarter ended March 31, 2019.
Rick Mills, Chief Executive
Officer, remarked, "CRI achieved record quarterly revenue of
approximately $9.5 million in the
first quarter of 2019 and we are on track to our previously issued
guidance for the first half. We produced a small operating profit
during the quarter and positive EBITDA of $368 thousand. As we finalize the integration of
financial and operating activities of Allure, we expect to drive
reductions in operating expenses and take further advantage of the
economies of scale achieved thus far. We are proud of the continued
progress."
2019 First Quarter Financial Overview
- Revenues were $9.5 million for
the three-month period ended March 31,
2019, an increase of $5.4
million, or 133%, compared to the same period in 2018.
- Hardware revenue grew approximately $0.4
million, or 33%, in the first quarter of 2019 as compared to
the same period in the prior year. Gross margin on hardware revenue
was 14%, compared to 11% in 1Q18.
- Services and other revenue grew approximately $5.0 million, or 177%, in the first quarter of
2019 as compared to the same period in the prior year. Gross margin
on services and other revenue was 44%, compared to 49% in 1Q18.
Excluding one engineering services project in the period, gross
margin on services and other revenue would have been approximately
49%.
- Managed services revenue, which includes both SaaS and help
desk technical subscription services, represented approximately
$1.5 million revenue in the first
quarter of 2019, an increase of $1.0
million, or 200%, as compared to the same period in the
prior year.
- Gross profit was $3.7 million for
the first quarter of 2019, an increase of $2.2 million, or 144%, compared to the same
period in 2018. Gross margin increased to 39% in 1Q19 versus 37% in
1Q18, driven primarily by the aforementioned mix of hardware and
services and other revenue.
- The company achieved operating breakeven during 1Q19 as
compared to an operating loss of $1.8
million in 1Q18.
- General and administrative expenses increased $0.6 million to $2.3
million in 1Q19 versus 1Q18 as the result of incremental
payroll, benefit and office expenses associated with the
acquisition of Allure Global Solutions, Inc. in November 2018.
- EBITDA was $0.4 million for the
first quarter of 2019 compared to an EBITDA loss of $1.2 million for the same period in 2018.
2019 Financial Guidance
The Company reaffirms its previous guidance of $18 to 20 million in revenue for the first half
of 2019.
Mr. Mills concluded, "We continue to see strong and improving
market demand for our products and services as clients look to take
advantage of the benefits of digital marketing in their evolving
ecosystems, including deployments of digital technology and
development of integrated applications to support those
deployments. We are pleased to see that our recurring portion of
our revenue is increasing substantially and look forward to
continued progress on this front. We believe our end-to-end
services offerings position us well within the industry to compete
for new and growing opportunities with partners in a variety of key
verticals including but not limited to retail, sports and
entertainment venues, quick service restaurants and convenience
stores. As we move through 2019, we remain committed to further
execution of our strategy to gain more scale and act as a key
participant in what we believe should be an industry rollup aimed
at driving shareholder value."
Conference Call Details
The Company will host a conference call to review the results
and provide additional commentary about the Company's recent
performance, which is scheduled for Friday,
May 10, 2019 at 9:00 am Eastern
Time.
Prior to the call, participants should register at
http://bit.ly/criearnings2019Q1. Once registered, participants can
use the weblink provided in the registration email to listen to the
live webcast.
Following the live webcast, a replay will be available
approximately two hours after the webcast on our website at
www.cri.com for at least 30 days.
About Creative Realities, Inc.
Creative Realities
helps clients use the latest omnichannel technologies to inspire
better customer experiences. Founded over 15 years ago, CRI
designs, develops and deploys consumer experiences for high-end
enterprise level networks, and is actively providing recurring SaaS
and support services for more than fifteen diverse vertical
markets, including but not limited to Automotive, Advertising
Networks, Apparel & Accessories, Convenience Stores,
Foodservice/QSR, Gaming, Theater, and Stadium Venues. The Company
acquired Allure Global Solutions, Inc. in November 2018, expanding the Company's operations
to five offices across North
America with active installations in more than 10
countries.
Cautionary Note on Forward-Looking Statements
This
press release contains certain statements that would be deemed
"forward-looking statements" under Section 27A of the Securities
Act of 1933 and Section 21E of the Securities Exchange Act of 1934
and includes, among other things, discussions of our business
strategies, future operations and capital resources. Words
such as "may," "likely," "anticipate," "expect" and "believe"
indicate forward-looking statements.
These forward-looking statements may reflect management's
present expectations and estimates regarding future expenses,
revenue and profitability, trends affecting our financial condition
and results of operations, operating efficiencies, revenue
opportunities, potential new markets, and the ability of the
Company to effectively compete in a highly competitive market.
Nevertheless, and despite the fact that management's expectations
and estimates are based on assumptions management believes to be
reasonable and data management believes to be reliable, the
Company's actual results, performance, or achievements are subject
to future risks and uncertainties, any of which could materially
affect the Company's actual performance. Risks and
uncertainties that could affect such performance include, but are
not limited to: the adequacy of funds for future operations;
future expenses, revenue and profitability; trends affecting
financial condition and results of operations; ability to convert
proposals into customer orders; the ability of customers to pay for
products and services; the impact of changing customer requirements
upon revenue recognition; customer cancellations; the availability
and terms of additional capital; ability to develop new products;
dependence on key suppliers, manufacturers and strategic partners;
industry trends and the competitive environment; the impact of the
Company's financial condition upon customer and prospective
customer relationships; and the impact of losing one or more senior
executives or failing to attract additional key personnel.
These and other risk factors are discussed in Company reports filed
with the Securities and Exchange Commission.
Given these uncertainties, and the fact that forward-looking
statements represent management's estimates and assumption as of
the date of this press release, you should not attribute undue
certainty to these forward-looking statements. We assume no
obligation to update any forward-looking statements publicly, or to
update the reasons why actual results could differ materially from
those anticipated in any forward-looking statements contained in
this press release, even if new information becomes available in
the future.
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SOURCE Creative Realities, Inc.