Exhibit 99.1
The Digital Engagement Company |
Bridgeline Digital Announces First Quarter of Fiscal 2016 Financial Results
Express Product Offering Wins New Customers in both Franchise and Commerce Markets
Company Reports Positive Adjusted EBITDA for the Second Consecutive Quarter
Gross Margin Improved to 51% in the First Quarter of Fiscal 2016
Burlington, Mass.,February 11, 2016 - Bridgeline Digital, Inc. (NASDAQ: BLIN), The Digital Engagement Company™, today announced financial results for its first quarter ended December 31, 2015.
“Bridgeline’s new express products are attracting customers faster than we anticipated with wins in both the franchise and the commerce markets”, said Ari Kahn, Bridgeline’s President and Chief Operating Officer. “Our express products are driving the Company’s transformation to a stronger SaaS business with higher license revenue and recurring revenue. We are also pleased to have delivered positive Adjusted EBITDA for the second consecutive quarter and are focused on continuing to drive positive Adjusted EBITDA in future quarters and increase shareholder value.”
First Quarter Highlights:
● | Adjusted EBITDA improved by $1.3 million to $65 thousand for the first quarter of fiscal 2016, compared to ($1.25) million in the first quarter of fiscal 2015. |
● | Subscription and perpetual license revenue increased 10% to $1.5 million in the first quarter of fiscal 2016, compared to $1.4 million in the first quarter of fiscal 2015. |
● | Gross margin improved to 51% in the first quarter of fiscal 2016, from 39% in the first quarter of fiscal 2015. |
● | Operating expenses reduced by 33% (excluding restructuring charges) to $2.6 million in the first quarter of fiscal 2016 from $3.9 million in the first quarter of fiscal 2015. |
Conference Call Information
Bridgeline Digital will host a conference call to discuss first quarter 2016 results at 4:30 p.m. ET today. To listen to the conference call, please dial (877) 837-3910 within the U.S. or (973) 796-5077 for international callers.
Non-GAAP Financial Measures
This press release contains the following non-GAAP financial measures: non-GAAP adjusted net income, non-GAAP adjusted earnings per diluted share, Adjusted EBITDA and Adjusted EBITDA per diluted share.
Non-GAAP adjusted net income and non-GAAP adjusted earnings per diluted share are calculated as net income or net income per share on a diluted basis, excluding, where applicable, amortization of intangible assets, stock-based compensation, restructuring charges, preferred stock dividends and any related tax effects.
Adjusted EBITDA and Adjusted EBITDA per diluted share are defined as earnings before interest, taxes, depreciation and amortization, stock-based compensation charges, restructuring charges, preferred stock dividends and any related tax effects. Bridgeline uses non-GAAP adjusted net income and Adjusted EBITDA as supplemental measures of our performance that are not required by, or presented in accordance with, accounting principles generally accepted in the United States (“GAAP”).
Bridgeline’s management does not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with GAAP. The principal limitation of these non-GAAP financial measures is that they exclude significant expenses and income that are required by GAAP to be recorded in the Company's financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgments by management about which expenses and income are excluded or included in determining these non-GAAP financial measures. In order to compensate for these limitations, Bridgeline management presents non-GAAP financial measures in connection with GAAP results. Bridgeline urges investors to review the reconciliation of its non-GAAP financial measures to the comparable GAAP financial measures, which is included in this press release, and not to rely on any single financial measure to evaluate Bridgeline's financial performance.
Our definitions of non-GAAP adjusted net income and Adjusted EBITDA may differ from and therefore may not be comparable with similarly titled measures used by other companies, thereby limiting their usefulness as comparative measures. As a result of the limitations that non-GAAP adjusted net income and Adjusted EBITDA have as an analytical tool, investors should not consider them in isolation, or as a substitute for analysis of our operating results as reported under GAAP.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
All statements included in this press release, other than statements or characterizations of historical fact, are forward-looking statements. These forward-looking statements are based on our current expectations, estimates and projections about our industry, management's beliefs, and certain assumptions made by us, all of which are subject to change. Forward-looking statements can often be identified by words such as "anticipates," "expects," "intends," "plans," "predicts," "believes," "seeks," "estimates," "may," "will," "should," "would," "could," "potential," "continue," "ongoing," or similar expressions, and variations or negatives of these words. These forward-looking statements are not guarantees of future results and are subject to risks, uncertainties and assumptions, including, but not limited to,the impact of the weakness in the U.S. and international economies on our business, our inability to manage our future growth effectively or profitably, fluctuations in our revenue and quarterly results, our license renewal rate, the impact of competition and our ability to maintain margins or market share, the limited market for our common stock, the volatility of the market price of our common stock, the performance of our products, our ability to respond to rapidly evolving technology and customer requirements, our ability to protect our proprietary technology, the security of our software, our dependence on our management team and key personnel, our ability to hire and retain future key personnel, or our ability to maintain an effective system of internal controlsas well as other risks described in our filings with the Securities and Exchange Commission. Any of such risks could cause our actual results to differ materially and adversely from those expressed in any forward-looking statement. We expressly disclaim any obligation to update any forward-looking statement.
About Bridgeline Digital
Bridgeline Digital, The Digital Engagement Company™, helps customers maximize the performance of their full digital experience – from websites and intranets to online stores and campaigns. Bridgeline’s iAPPS® platform deeply integrates Web Content Management, eCommerce, eMarketing, Social Media management, and Web Analytics to help marketers deliver digital experiences that attract, engage and convert their customers across all channels. Headquartered in Burlington, Mass., Bridgeline has thousands of quality customers that range from small- and medium-sized organizations to Fortune 1000 companies. To learn more, please visitwww.bridgeline.com or call (800) 603-9936.
Contact:
Bridgeline Digital, Inc.
Michael D. Prinn
Executive Vice President
& Chief Financial Officer
781.497.3016
mprinn@bridgeline.com
BRIDGELINE DIGITAL, INC.
RECONCILIATION OF GAAP TO NON-GAAP RESULTS
(Dollars in thousands, except per share data)
Three Months Ended | ||||||||
December 31, | ||||||||
2015 | 2014 | |||||||
Reconciliation of GAAP net loss tonon-GAAP adjusted net loss: | ||||||||
GAAP net loss applicable to common shareholders | $ | (1,380 | ) | $ | (2,131 | ) | ||
Amortization of intangible assets | 107 | 152 | ||||||
Stock-based compensation | 72 | 89 | ||||||
Restructuring charge | 586 | - | ||||||
Preferred stock dividends | 32 | 21 | ||||||
Non-GAAP adjusted net loss | $ | (583 | ) | $ | (1,869 | ) | ||
Reconciliation of GAAP loss per diluted share tonon-GAAP adjusted loss per diluted share: | ||||||||
GAAP net loss per share applicable to common shareholders | $ | (0.25 | ) | $ | (0.49 | ) | ||
Amortization of intangible assets | 0.02 | 0.03 | ||||||
Stock-based compensation | 0.01 | 0.02 | ||||||
Restructuring charge | 0.11 | - | ||||||
Preferred stock dividends | - | - | ||||||
Non-GAAP adjusted net loss per diluted share | $ | (0.11 | ) | $ | (0.43 | ) | ||
Reconciliation of GAAP net loss to Adjusted EBITDA: | ||||||||
GAAP net loss applicable to common shareholders | $ | (1,380 | ) | $ | (2,131 | ) | ||
Provision for income tax | 6 | 35 | ||||||
Interest expense, net | 283 | 162 | ||||||
Amortization of intangible assets | 107 | 152 | ||||||
Depreciation | 231 | 279 | ||||||
Restructuring charge | 586 | - | ||||||
Other amortization | 128 | 146 | ||||||
Stock-based compensation | 72 | 89 | ||||||
Preferred stock dividends | 32 | 21 | ||||||
Adjusted EBITDA | $ | 65 | $ | (1,247 | ) | |||
Reconciliation of GAAP net loss per diluted share toAdjusted EBITDA per diluted share: | ||||||||
GAAP net loss per share applicable to common shareholders | $ | (0.25 | ) | $ | (0.49 | ) | ||
Provision for income tax | - | 0.01 | ||||||
Interest expense, net | 0.06 | 0.04 | ||||||
Amortization of intangible assets | 0.02 | 0.03 | ||||||
Depreciation | 0.04 | 0.07 | ||||||
Restructuring charge | 0.11 | - | ||||||
Other amortization | 0.02 | 0.03 | ||||||
Stock-based compensation | 0.01 | 0.02 | ||||||
Preferred stock dividends | - | - | ||||||
Adjusted EBITDA per diluted share | $ | 0.01 | $ | (0.29 | ) |
BRIDGELINE DIGITAL, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands, except share and per share data)
(Unaudited)
Three Months Ended | ||||||||
December 31, | ||||||||
2015 | 2014 | |||||||
Revenue: | ||||||||
Digital engagement services | $ | 2,373 | $ | 3,231 | ||||
Subscription and perpetual licenses | 1,523 | 1,380 | ||||||
Managed service hosting | 347 | 401 | ||||||
Total revenue | 4,243 | 5,012 | ||||||
Cost of revenue: | ||||||||
Digital engagement services | 1,454 | 2,564 | ||||||
Subscription and perpetual licenses | 558 | 430 | ||||||
Managed service hosting | 77 | 74 | ||||||
Total cost of revenue | 2,089 | 3,068 | ||||||
Gross profit | 2,154 | 1,944 | ||||||
Operating expenses: | ||||||||
Sales and marketing | 1,068 | 1,810 | ||||||
General and administrative | 862 | 993 | ||||||
Research and development | 341 | 602 | ||||||
Depreciation and amortization | 356 | 452 | ||||||
Restructuring charge | 586 | - | ||||||
Total operating expenses | 3,213 | 3,857 | ||||||
Loss from operations | (1,059 | ) | (1,913 | ) | ||||
Interest expense, net | (283 | ) | (162 | ) | ||||
Loss before income taxes | (1,342 | ) | (2,075 | ) | ||||
Provision for income tax | 6 | 35 | ||||||
Net loss | $ | (1,348 | ) | $ | (2,110 | ) | ||
Dividends on convertible preferred stock | (32 | ) | (21 | ) | ||||
Net loss applicable to common shareholders | $ | (1,380 | ) | $ | (2,131 | ) | ||
Net loss per share attributable to common shareholders: | ||||||||
Basic and diluted | $ | (0.25 | ) | $ | (0.49 | ) | ||
Number of weighted average shares outstanding: | ||||||||
Basic and diluted | 5,164,809 | 4,343,023 |
BRIDGELINE DIGITAL, INC.
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands, except share and per share data)
(Unaudited)
December 31, | September 30, | |||||||
2015 | 2015 | |||||||
ASSETS | ||||||||
Current Assets: | ||||||||
Cash and cash equivalents | $ | 580 | $ | 337 | ||||
Accounts receivable and unbilled revenues, net | 2,507 | 2,463 | ||||||
Prepaid expenses and other current assets | 624 | 680 | ||||||
Total current assets | 3,711 | 3,480 | ||||||
Equipment and improvements, net | 1,084 | 1,315 | ||||||
Intangible assets, net | 921 | 1,028 | ||||||
Goodwill | 12,641 | 12,641 | ||||||
Other assets | 635 | 723 | ||||||
Total assets | $ | 18,992 | $ | 19,187 | ||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 1,282 | $ | 1,626 | ||||
Accrued liabilities | 1,396 | 1,046 | ||||||
Accrued earnouts, current | 301 | 468 | ||||||
Debt, current | 500 | 92 | ||||||
Capital lease obligations, current | 216 | 320 | ||||||
Deferred revenue | 1,592 | 1,542 | ||||||
Total current liabilities | 5,287 | 5,094 | ||||||
Debt, net of current portion | 7,879 | 7,695 | ||||||
Other long term liabilities | 784 | 726 | ||||||
Total liabilities | 13,950 | 13,515 | ||||||
Commitments and contingencies | ||||||||
Stockholders' equity: | ||||||||
Preferred stock - $0.001 par value; 1,000,000 shares authorized; 211,393 and 0, issued and outstanding, respectively (liquidation preference $2,146) | - | - | ||||||
Common stock - $0.001 par value; 50,000,000 shares authorized; 5,326,615 and 4,637,684 shares issued and outstanding, respectively | 5 | 5 | ||||||
Additional paid-in-capital | 51,183 | 50,434 | ||||||
Accumulated deficit | (45,791 | ) | (44,411 | ) | ||||
Accumulated other comprehensive loss | (355 | ) | (356 | ) | ||||
Total stockholders' equity | 5,042 | 5,672 | ||||||
Total liabilities and stockholders' equity | $ | 18,992 | $ | 19,187 |