WSTG - Earnings call transcript Q2 2019 | Climb Global Solutions, Inc.

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Operator

Good morning, ladies and gentlemen and welcome to the Wayside Technology Group Conference Call. At this time all participants are in a listen-only mode. Later we will conduct a question and answer session [Operator Instructions] As a reminder this conference is being recorded.

I would now like to introduce your host for today's conference, Melanie Caponigro. Ms. your this begin may you conference time. at Caponigro,

Melanie Caponigro

Welcome Technology's Second you and XXXX Wayside morning. good Thank Quarter to Earnings Call.

call with language the second Relations Before Distribution, call. We webcast the over at release President earnings Foster, turning for earnings answers, of including X, XXXX. for I'll and this dispense comments will approximately available the being company's and Investor is cautionary all live The quarter at call, Today's and released release customary about August the Dale website earnings Wednesday, Lifeboat a waysidetechnology.com. X Time, p.m. be is www.waysidetechnology.com/site/content/webcast. Eastern webcast available questions at the rebroadcast at

certain XXXX. uncertainties that I'd subject Private under differ this made and the in and Those to Litigation risks actual forward-looking cause like materially. you conference Act Reform statements statements to Securities that are of comments to results webcast remind could call are considered

these and any to in does risks no contained obligation intend and update is with Additional Technology statements. sees Wayside update to filed information SEC. not XX-K concerning Group uncertainties XX-Q forward-looking and Forms our the

share. directly also non-GAAP reconciled accordance financial includes certain per adjusted have including billings, measures with net comparable most GAAP presentation rules. income measures non-GAAP to SEC earnings measures, the non-GAAP been and Our gross non-GAAP All in

SEC. reconciliation find the X-K charts with You'll in filed the Form earnings and we release

turn like would to call the over I Now Dale. to

Dale Foster

us for results. Thanks, to and Melanie joining our today second morning you Thank XXXX everyone. discuss quarter operating good

months increasing over last gross million we and increasing over recruitment margin sales or quarter we saw marketing revenues year made from some XX% XX in past dollars quarter tangible vendor second and $X.X investments This results XX%. the the and with

our with the Lifeboat in entirely in quarter that this Lifeboat's upon new of increase saw non-GAAP strategy this noteworthy position providing over $X year. gross increasing the achieve business, also million the achieved within profit last same our It and We also or building XXX% market. net is can validation model income leverage was

our and disruption, a years in line unique our In to with beginning card as interaction relationships the and return sales increase XXXX, breadth profits with presence of of to clearly support on emerging technology sales highest a expanding field form of the investment plus the XX market a vendor initiatives. to and is to existing on In channel. focused recruitment developed a with in has expanded by we partners XXXX the remained show Lifeboat entrance relationships innovators. provide new vendor providing organizations higher along new our our growth diverse the level partners to vendors' history defined increased this and and of the gross level we support technology

million net XX% $X.X Our million year-to-date profits improvements dropping cloning $X.X income with results or growth through with to line. our similar show

As to to tune on and new strategic emerging to investments we success partners. technology consistently marketing execute leading plan for we sales continue and the our emerging distributor become with companies, drive the

to significant invest have the and multiple team field sales outside sales number vendors. as additional well. our base with field enable resellers These to sales allowing territories. are our partners. to us value-added resellers resources reach These of investments vendor us cross-sell will brands incremental emerging to continued in with a emerging X over back Looking of adding we made day We've and last positions months, several progress members

contract offer with vehicle From vendor marketing standpoint, partners. we've our begun GSA our a to

storage we in players container complement with the outstanding and our teaming resellers launched And to security Arcserve new space rapidly space. actively are our added the such our contracts. valued partners Garland with backup our our We relationship Technology. GSA evolving We've with unproven launched recently relationships as to vendor also portfolio on manufacturer a We've just -- Monte vendors.

Vesey, Michael our will to I to now or Vice detail. results CFO the President more of review in Finance, and over operating turn call

Michael Vesey

more last sheet for million, our to I'll the discuss XX% distribution $XX.X year. our the million. Lifeboat XX% Overall results quarter million distribution and to compared net the the million sales to compared product net changes growth in for second increased new approximately for increased increased for of rebates compared to review discounts. XX% the in from sales quarter Dale. for $X.X were were to product the TechXtend quarter quarter $X.X the then while to for second for profit last period incremental up $X.X several Lifeboat lines $XX.X financial pay million significant and Thanks, net Gross and to vendor liquidity. million due to year the million second lines, to million to XX% sales for quarter quarter $X.X sales gross last same year. XX% due down balance $X.X our profit quarter of $XXX,XXX quarter for $XX.X the early

in was as in result profit in had a change net negative gross of we to decreased products quarter in it's a last extended capital mix mainly up percentage to an recorded change which just but second on our to ASC XXX. net a payment were a providing margin part terms the year. sales due Our quarter profit capital the sales of not return adequate business. on XX.X% freed sales consolidated on net increased basis Gross them. profit under determined the TechXtend gross margin in XX.X% The business Declining of a as invest business impact required declined percentage fund Lifeboat and of to

and sales the expenses from compensation net our effective hardware in to same $XXX,XXX by XXX% by product million mix reported increase profit or on an of a During on was net a second were security percentage basis This the gross approximately partially to products in to XX for the had gross as in were recorded X.X% administrative general margin partially compared points. X.X% the last basis of and shift quarter a offset by of a year. software which XXXX. quarter quarter XX.X% of maintenance other products offset quarter quarter effect increasing sales XXXX. XXXX, net compared gross of of SG&A the expenses in percentage lower same XX.X% as This increased increases selling, net on $X.X for XXXX, $X.X These Total margins were by million compared the profit gross in basis. were lower for to expense. stock-based and revenues

Statutes. taxes the limitations of section quarter deductibility the resulting provision Internal of was income XXXX. taxes adjustments taxes of company's of the for of state for recorded The months ordinary Code for accrual to to prior For XXXX, rate for XXXX, enacted expenses the period ended tax in company's compared XXXM XX, XXXX, the June second year. income the compensation, have effective same the $XXX,XXX effective a period the on quarter states which from was second rate the company XX.X% income compared executive tax provision $XXX,XXX to The of and income before X company on Economic the for XX.X% Nexus impacted by in in Revenue separation and same

in for to $X.X $X.X a for XX, the same of XXXX. ended period net compared a net June quarter As million loss XXXX, million the was result, income

taxes basis, quarter income for for to income period the $X.X of in $XXX,XXX increase of our of representing an compared in a of second that net the and expenses Therefore, million excluding The impact non-GAAP expenses and net separation impacted for and XXXX non-GAAP On was separation $XXX,XXX quarter release. were same the respectively. we million by earnings results $X taxes, net XXX%. XXXX, of second XXXX XXXX presented over

compared separation compared of $X.XX of separation the non-GAAP the a million Diluted earnings for the taxes $X.X expenses basis, the for XXXX, share was net a second per loss same earnings net XXXX. $X.XX period XXXX quarter compared share excluding XXXX. XXXX. per $X.XX quarter same share income June was of for in in period Non-GAAP to net was $X.X diluted XX, million, in diluted for the XXth period expenses $X.XX ended for per to year-to-date same June to On excluding

in compared While non-GAAP share the $X.XX diluted the earnings year. prior same was to for period $X.XX per

on balance sheet. Moving our to

at maintain on December continue position to We $XX.X cash compared a of sheet period equivalents to and end the $X.X liquidity XXXX. XX, million the strong with million balance and of

our borrowings payment our our $XX resulting of customers gross cash million vendors discount paid early reflects by credit margins impact extended facility. to our zero our which the short decrease as in one The a under terms outstanding and as this well with term balance have increased sales of us from terms. utilization We changes impacted period positively in

year. Stockholders' $XX.X million including to end equity of last compared of at year. was Total million the end $XX.X $XX.X $XX.X the last to capital compared working million at cash million started

calculate during We form our the income August XX% Board separation net with continue stock run of return record stockholders less period business capital-efficient XXXX, share return We shareholders' cash. capital Directors same of declared XXXX, stockholders to of On significant capital a year. $X.XX dividing returned in approximately last excluding XXXX, by quarterly the portion its XX% XXXX. XX, earnings a by on a invested the of net of taxes equity, payable per to non-GAAP to on on We to investment a of August XX, X, dividend. compared common a on dividend expenses, in August QX

concluding remarks. back Foster turn now for call will I the to Dale

Dale Foster

a employees work Thank and company great continues place work. all you, whose make our Mike. I thank would to like this to of hard to

I Your wonderful noteworthy. and our who together like thank have mutual customers achieve also goals. been in are working initiatives would our to vendors to

encouragement continue strategic to and would Board I our shareholders like of Lastly, to and long we ongoing Directors execute as for business their plan. our support recognize term

our operator, community to analyst call questions. please open that, the and With for investor

Operator

you. first Morton thank comes from [ph]. [Operator Lewis question Instructions] Absolutely, Our

open. is line Your now

Unidentified Analyst

which and the just followed had you're or is be that years was you've this are mind. things the customers? a anomaly this people there I I good, based of are selling now in and stock morning. to basis that something on the to that just going-forward on Good configuration added that generating I seem confident that for produced, the of is you've X different sales The very software wondering, many an earnings

Michael Vesey

as It's oriented a Vesey. past from The Mike our is next. quarter, way tends have the to the quarter. business. TechXtend this X in fluctuate business, you're look segments and one deal for we deal we the discussed smaller we've deal to at business, TechXtend of kind Big And quarter Lifeboat. our Hi, business,

Lifeboat a X.X little growth our various focusing functions and step the things, the products on is we've Over driven vendor relationships add we in which of They're past as predictable. vendors' building been years, acceptance the more businesses marketplace. by

Our it. vendors' year-end play into

It's technologies. more it's think niche within focusing We a in believe our market, that we new sustainable emerging and we there. Lifeboat. of technologies feel or part for -- of disruptive a entrants we on the we're we said, being advantage strategy we're have not market So believe our business exploiting stagnant always there's focused an

to From extent the always part a sustainable a in any think the a perspective, could view any we're to an happen from trying point execute that's business. in strategy So of risk of it market. we

subject technology spending be so down we're could like that things and So same those tomorrow risks. always to

think view I that's it. to the So way

Unidentified Analyst

noticed direction any that be positive is sales effort seem also for since configuring balance to in following a terms to a are had the there company, there you I and good no in and force nice products? terms you've your exposure got you moving analysts dividend your the and of a stock, more really in especially sheet get

Michael Vesey

the of a over changes the with awareness begun year Yes, at up in and past and the meetings we follow yes. is lot conferences company answer people. outbound have had some We've

In has aware, that a you're right coverage as little changed analyst in now, universe small-cap getting terms of probably the bit.

towards on of just couple market to eye us. get and perhaps and interest to some business really quarters our place. have execute in we conferences So create feel an some awareness trying have through in on that under strategy We to people general get get may writing do we the a

working So how our of market execute we the how establishing creating definitely upon on general something that can to we're and more strategy. category awareness put under it

Unidentified Analyst

what statistics [indiscernible] that amount is? do a looking in that at, of large I'm shorts stock you Selling suppose the

Michael Vesey

the there's quantify be lot to you're you. that reason, a determines stock of know specific that stock. how a not short in reflect so of numbers interest our a with -- if know we at the There's I lot trading a looking don't in I honest don't

industry buy they have the best that don't that like industry nothing -- terms think situation we somebody we think the of would or I think it's known where ability not didn't drive like So or get to anything said, in fundamentals that. I a

Unidentified Analyst

consistently has to it's $XX changing around and the the on and down. this gone point quote point was seems that one just format of I plus change you it stock be the remember at did because But when it been successful. emphasis at if, the and

to try get the Now's really time public interest. to some

hope continue today. Today, might I quarter of that late then there's of say, you you stock up. look noticed to interest. as out you and kind get and you some help So Certainly, people a of came interest that for give amount fair analysts the your help price

I of guys in do and best wish So I you to think it that positive continuing good looks job. luck

Michael Vesey

Appreciate that.

Dale Foster

you, Lewis. Thank

Operator

[Operator Instructions] time continue any closing please Thank no questions At you. are there this further with remarks.

Dale Foster

joining third like after call quarter. you. We'd Thank everybody to and us look for for forward our call conference to quarterly the our thank next

Operator

Now conference this concludes today's call.

for You may joining. this time. you disconnect at Thank

Climb Global Solutions (CLMB) 12 Aug 192019 Q2 Earnings call transcript