Wayside Technology Group, Inc. Reports First Quarter 2010 Results and Declares Quarterly Dividend
Revenue: $40.4 Million, up 27% Year-Over-Year; Income From Operations $0.9 Million, up 15% Year-Over-Year; $.15 Dividend Declared
SHREWSBURY, NJ -- (MARKET WIRE) -- 04/29/10 -- Wayside Technology Group, Inc. (NASDAQ: WSTG) today reported financial results for the first quarter ended March 31, 2010. The results will be discussed in a conference call to be held on Friday, April 30, 2010 at 10:00 AM Eastern time. The dial-in telephone number is (866) 261-7280 and the pass code is "WSTG".
This conference call will be available via live webcast -- in listen-mode only -- at www.earnings.com. A replay will also be available on the company's website at www.waysidetechnology.com.
Cash and marketable securities amount to $16.0 million, representing 65% of equity as of March 31, 2010. The company has no debt.
Total net sales for the first quarter of 2010 amounted to $40.4 million, compared to $31.8 million for the same period in 2009, representing a 27% increase. Sales for the first quarter of 2010 for the Lifeboat segment were $29.1 million, compared to $20.2 million in the first quarter of 2009, representing a 44% increase. Sales for the first quarter of 2010 for the Programmer's Paradise segment were $11.2 million, compared to $11.5 million in the first quarter of 2009, representing a 2% decline.
Sales from our Lifeboat segment showed strong growth. The 44% increase in net sales in the first quarter of 2010 compared to 2009 was mainly a result of our continued focus on the expanding virtual infrastructure-centric business, the addition of several key product lines, and the strengthening of our account penetration.
Total gross profit for the first quarter of 2010 amounted to $4.0 million, compared to $3.5 million for the same period in 2009. Gross profit for the first quarter of 2010 for the Lifeboat segment was $2.7 million, compared to $2.0 million in the first quarter of 2009. Gross profit for the first quarter of 2010 for the Programmer's Paradise segment was $1.3 million, compared to $1.5 million in the first quarter of 2009. The decrease in gross profit dollars for the Programmer's Paradise segment was primarily due to lower sales volume.
Q1 revenue for our Lifeboat segment increased due to strong growth for some of our product lines, as well as to signing on more software publishers. As a result, gross profit dollars for our Lifeboat segment increased by 32% in the first quarter of 2010.
Total gross profit, as a percentage of net sales, for the quarter ending March 31, 2010, was 9.8%, compared to 10.9% in the first quarter of 2009.
"The first quarter of 2010 showed excellent growth," said Simon F. Nynens, Chairman and Chief Executive Officer. "We strengthened our position in the software distribution market and continued to sign on new vendors. Strong revenue growth allowed us to drive a solid earnings performance."
Total selling, general, and administrative ("SG&A") expenses for the first quarter of 2010 were $3.0 million, compared to $2.7 million in the first quarter of 2009. This increase is mainly due to an increase in employee related expenses (salaries, commissions, bonus accruals and benefits) of $0.2 million and an increase in stock compensation expense of $0.1 million.
On April 27, 2010, the Board of Directors declared a quarterly dividend of $.15 per share of its common stock payable May 19, 2010 to shareholders of record on May 12, 2010.
About Wayside Technology Group, Inc.
Wayside Technology Group, Inc. (NASDAQ: WSTG) was founded in 1982 and is a unified and integrated technology company providing products and solutions for corporate resellers, VARs, and developers, as well as business, government and educational entities. The company offers technology products from software publishers and manufacturers such as Acronis, Computer Associates, DataCore, Dell, Flexera Software (publishers of InstallShield), GFI, Hewlett Packard, Infragistics, Intel Software, Microsoft, Mindjet, Quest Software, SolarWinds, StorageCraft Technology, TechSmith, Veeam, Vizioncore, and VMware.
Additional information can be found by visiting www.waysidetechnology.com.
The statements in this release concerning the Company's future prospects are forward-looking statements that involve certain risks and uncertainties. Such risks and uncertainties could cause actual results to differ materially from those indicated by such forward-looking statements, and include, without limitation, the continued acceptance of the Company's distribution channel by vendors and customers, the timely availability and acceptance of new products, product mix, market conditions, contribution of key vendor relationships and support programs, as well as factors that affect the software industry in general and other factors. The forward-looking statements contained herein are also subject generally to other risks and uncertainties that are described from time to time in our filings with the Securities and Exchange Commission. Except as otherwise required by law, the Company undertakes no obligation to update or revise these forward-looking statements.
- Tables Follow -
WAYSIDE TECHNOLOGY GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share amounts)
March 31, December 31,
2010 2009
----------- -----------
(unaudited)
ASSETS
Current assets
Cash and cash equivalents $ 9,410 $ 8,560
Marketable securities 6,550 7,571
Accounts receivable, net 27,822 27,040
Inventory - finished goods 1,230 967
Prepaid expenses and other current assets 788 998
Deferred income taxes 638 677
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Total current assets 46,438 45,813
Equipment and leasehold improvements, net 444 432
Accounts receivable long-term 5,043 6,901
Other assets 40 38
Deferred income taxes 414 483
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Total assets $ 52,379 $ 53,667
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable and accrued expenses 27,770 29,230
----------- -----------
Total current liabilities 27,770 29,230
Other liabilities 78 78
----------- -----------
Total liabilities 27,848 29,308
Commitments and contingencies
Stockholders' equity
Common stock, $.01 par value; 10,000,000 shares
authorized, 5,284,500 shares issued, and
4,824,953 and 4,688,844 shares outstanding,
respectively 53 53
Additional paid-in capital 24,515 24,826
Treasury stock, at cost, 459,547 and 595,656
shares, respectively (3,060) (3,555)
Retained earnings 2,640 2,727
Accumulated other comprehensive income 383 308
----------- -----------
Total stockholders' equity 24,531 24,359
----------- -----------
Total liabilities and stockholders' equity $ 52,379 $ 53,667
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WAYSIDE TECHNOLOGY GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
(In thousands, except per share data)
Three months ended
March 31,
2010 2009
------------ -----------
(Unaudited)
------------------------
Revenues
Lifeboat segment 29,117 20,243
Programmer's Paradise segment 11,241 11,507
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Total Revenue $ 40,358 $ 31,750
Cost of sales
Lifeboat segment 26,472 18,244
Programmer's Paradise segment 9,918 10,039
------------ -----------
Total Cost of sales 36,390 28,283
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Gross Profit 3,968 3,467
Operating expenses
Selling costs 1,491 1,295
Stock based compensation 301 184
Other general and administrative expenses 1,238 1,172
------------ -----------
Total Selling, general and administrative
expenses 3,030 2,651
------------ -----------
Income from operations 938 816
Interest income, net 108 148
Realized foreign exchange gain (loss) 1 (1)
------------ -----------
Income before income tax provision 1,047 963
Provision for income taxes 424 385
------------ -----------
------------ -----------
Net income $ 623 $ 578
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Net income per common share - Basic $ 0.14 $ 0.13
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Net income per common share - Diluted $ 0.14 $ 0.13
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Weighted average common shares outstanding -
Basic 4,371 4,386
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Weighted average common shares outstanding -
Diluted 4,425 4,413
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Released April 29, 2010