Exhibit 99.1

 

Company Contact:

Tom Flaherty, Chief Financial Officer

Wayside Technology Group, Inc.

(732) 389-0932  tom.flaherty@waysidetechnology.com

 

 

WAYSIDE TECHNOLOGY GROUP, INC. REPORTS FOURTH QUARTER 2012 RESULTS

AND DECLARES QUARTERLY DIVIDEND

 

 

 

Q4 2012:

 

Year 2012:

Revenue:

 

$85.5 million

 

$297.1 million

Income from operations:

 

$2.8 million

 

$8.5 million

Net income:

 

$1.8 million

 

$5.5 million

Diluted earnings per share:

 

$0.39 per share

 

$1.19 per share

Dividend declared:

 

$0.16 per share

 

$0.64 per share

 

SHREWSBURY, NJ, January 31, 2013 — Wayside Technology Group, Inc. (NASDAQ: WSTG) today reported financial results for the fourth quarter ended December 31, 2012.  The results will be discussed in a conference call to be held on Friday, February 1, 2013 at 10:00 AM Eastern time.  The dial-in telephone number is (866) 793-1341 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.

 

“The fourth quarter was our best quarter in 2012.  Revenues, gross profit, income from operations and net income all contributed to deliver our best quarter in 2012,” said Simon F. Nynens, Chairman and Chief Executive Officer. “Our TechXtend division performed exceptionally well in Q4 with Lifeboat Distribution delivering solid results.  Overall, we grew our product line offerings as we continue to pursue our mission to become the most trusted and respected IT provider in our industry.”

 

Cash and marketable securities amounted to $14.2 million, representing 44% of equity as of December 31, 2012. Working capital amounted to $19.6 million, representing 61% of equity as of December 31, 2012.

 

Net sales for the fourth quarter ended December 31, 2012 increased 15%, or $11.2 million, to $85.5 million compared to $74.2 million for the same period in 2011.  Net sales for the fourth quarter of 2012 for our Lifeboat Distribution segment were $58.5 million compared to $55.1 million in the fourth quarter of 2011, representing an increase of $3.4 million or 6%.  Net sales for the fourth quarter of 2012 for our TechXtend segment were $26.9 million compared to $19.1 million in the fourth quarter of 2011, representing an increase of $7.8 million or 41%.

 

Net sales for the year ended December 31, 2012 increased 19%, or $46.9 million, to $297.1 million compared to $250.2 million in 2011. Total sales for our Lifeboat Distribution segment in 2012 were $217.3 million compared to $192.7 million in 2011, representing an increase of $24.6 million or 13%. Total sales for the TechXtend segment in 2012 amounted to $79.7 million, compared to $57.4 million in 2011, representing an increase of $22.3 million or 39%.

 

The increase in net sales for the three month and full year ended December 31, 2012, compared to the same periods in 2011, was mainly a result of strengthening of our account penetration, our continued focus on the expanding virtual infrastructure-centric business, our solution focus selling and an increase in large deals on extended payment terms.

 

Gross Profit for each of the fourth quarters ended December 31, 2012 and December 31, 2011 was $7.0 million.  Gross profit for our Lifeboat Distribution segment for the fourth quarter of 2012 was $4.5 million compared to $5.0 million in the fourth quarter of 2011, representing a 10% decrease. Gross profit for our TechXtend segment was $2.6 million compared to $2.1 million in the fourth quarter of 2011, representing a 23% increase.  Vendor rebates and discounts for the quarter ended December 31, 2012 amounted to $0.6 million compared to $0.8 million for the fourth quarter of 2011.

 



 

Gross Profit for the year ended December 31, 2012 was $23.9 million compared to $23.2 million in 2011, a 3% increase.  Gross profit for our Lifeboat Distribution segment was $15.8 million compared to $16.8 million in 2011, representing a 6% decrease.  Gross profit for our TechXtend segment was $8.1 million compared to $6.4 million in 2011, representing a 25% increase. Vendor rebates and discounts for the year ended December 31, 2012 amounted to $1.8 million compared to $2.9 million for 2011.  Gross profit margin (gross profit as a percentage of net sales) for 2012 was 8.0% compared to 9.3% in 2011.

 

The increase in gross profit dollars and the decrease in gross profit margin were primarily caused by the sales growth within our Lifeboat Distribution and TechXtend segments, offset in part, by continued pressure on discounts and rebates earned and by competitive pricing pressure in both segments.  The decrease in gross profit margin was also impacted by having won several large bids, including transactions on extended payment terms, based on aggressive pricing which we plan to continue.

 

Total selling, general, and administrative (“SG&A”) expenses for the fourth quarter of 2012 were $4.2 million compared to $4.0 million for the fourth quarter of 2011.  Total SG&A expenses for 2012 were $15.4 million compared to $14.6 million in 2011, representing an increase of $0.8 million.  This increase is primarily the result of an increase in sales commissions for our TechXtend segment due to our growth in this segment, the addition of employees in sales, finance and operations to support business growth and higher professional fees.

 

Net income and diluted earnings per share for the fourth quarter of 2012 were $1.8 million and $0.39, respectively, compared to $2.0 million and $0.43, respectively for the fourth quarter of 2011.  Net income and diluted earnings per share for 2012 were $5.5 million and $1.19, respectively, compared to $5.5 million and $1.20, respectively in 2011.

 

On January 30, 2013, the Board of Directors declared a quarterly dividend of $.16 per share of its common stock payable February 22, 2013 to shareholders of record on February 12, 2013.

 

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, CA Technologies, DataCore, Datawatch, Dell, Flexera Software, GFI, Hewlett Packard, Infragistics, Intel Software, Lenovo, Microsoft, Mindjet, Quest Software, SolarWinds, Sophos, StorageCraft Technology, TechSmith, Veeam, Vision Solutions 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

(Amounts in thousands, except share and per share amounts)

 

 

 

December 31,
2012

 

December 31,
2011

 

 

 

(unaudited)

 

 

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

Current assets

 

 

 

 

 

Cash and cash equivalents

 

$

9,835

 

$

9,202

 

Marketable securities

 

4,411

 

5,375

 

Accounts receivable, net

 

61,388

 

47,066

 

Inventory - finished goods

 

1,717

 

1,240

 

Prepaid expenses and other current assets

 

1,281

 

1,997

 

Deferred income taxes

 

280

 

329

 

Total current assets

 

78,912

 

65,209

 

 

 

 

 

 

 

Equipment and leasehold improvements, net

 

375

 

458

 

Accounts receivable long-term

 

11,851

 

8,889

 

Other assets

 

71

 

54

 

Deferred income taxes

 

236

 

251

 

 

 

 

 

 

 

Total assets

 

$

91,445

 

$

74,861

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

Accounts payable and accrued expenses

 

$

59,265

 

$

45,796

 

Current portion- capital lease obligation

 

55

 

76

 

Total current liabilities

 

59,320

 

45,872

 

 

 

 

 

 

 

Long term portion- capital lease obligation

 

 

55

 

Total liabilities

 

59,320

 

45,927

 

 

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity

 

 

 

 

 

Common stock, $.01 par value; 10,000,000 shares authorized, 5,284,500 shares issued, and 4,740,873 and 4,679,878 shares outstanding, respectively

 

53

 

53

 

Additional paid-in capital

 

27,712

 

26,725

 

Treasury stock, at cost, 543,627 and 604,622 shares, respectively

 

(5,373

)

(4,991

)

Retained earnings

 

9,316

 

6,818

 

Accumulated other comprehensive income

 

417

 

329

 

Total stockholders’ equity

 

32,125

 

28,934

 

Total liabilities and stockholders’ equity

 

$

91,445

 

$

74,861

 

 



 

WAYSIDE TECHNOLOGY GROUP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

(Amounts in thousands, except per share data)

 

 

 

Year ended

 

Three months ended

 

 

 

December 31,

 

December 31,

 

 

 

2012

 

2011

 

2012

 

2011

 

 

 

(Unaudited)

 

(Unaudited)

 

Revenues

 

 

 

 

 

 

 

 

 

Lifeboat segment

 

$

217,342

 

$

192,720

 

$

58,504

 

$

55,099

 

TechXtend segment

 

79,715

 

57,449

 

26,943

 

19,119

 

Total Revenue

 

297,057

 

250,169

 

85,447

 

74,218

 

 

 

 

 

 

 

 

 

 

 

Cost of sales

 

 

 

 

 

 

 

 

 

Lifeboat segment

 

201,524

 

175,916

 

54,022

 

50,112

 

TechXtend segment

 

71,641

 

51,012

 

24,388

 

17,048

 

Total Cost of sales

 

273,165

 

226,928

 

78,410

 

67,160

 

 

 

 

 

 

 

 

 

 

 

Gross Profit

 

23,892

 

23,241

 

7,037

 

7,058

 

 

 

 

 

 

 

 

 

 

 

Operating expenses

 

 

 

 

 

 

 

 

 

Selling costs

 

8,079

 

7,774

 

2,222

 

2,179

 

Stock based compensation

 

1,071

 

1,059

 

328

 

235

 

Other general and administrative expenses

 

6,227

 

5,790

 

1,679

 

1,573

 

Total Selling, general and administrative expenses

 

15,377

 

14,623

 

4,229

 

3,987

 

 

 

 

 

 

 

 

 

 

 

Income from operations

 

8,515

 

8,618

 

2,808

 

3,071

 

 

 

 

 

 

 

 

 

 

 

Interest income, net

 

557

 

368

 

163

 

104

 

Realized foreign exchange gain

 

17

 

1

 

4

 

 

Income before income tax provision

 

9,089

 

8,987

 

2,975

 

3,175

 

Provision for income taxes

 

3,600

 

3,448

 

1,172

 

1,200

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

5,489

 

$

5,539

 

$

1,803

 

$

1,975

 

 

 

 

 

 

 

 

 

 

 

Net income per common share - Basic

 

$

1.23

 

$

1.26

 

$

0.40

 

$

0.45

 

Net income per common share - Diluted

 

$

1.19

 

$

1.20

 

$

0.39

 

$

0.43

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding - Basic

 

4,476

 

4,412

 

4,502

 

4,412

 

Weighted average common shares outstanding - Diluted

 

4,628

 

4,606

 

4,622

 

4,570