Exhibit 99.1

 

 

Wayside Technology Group, Inc. Reports 2015 Third Quarter Results
and Declares
Quarterly Dividend

 

 

Q3 2015:

Revenue:

$97.7 million

Income from operations:

$2.3 million

Diluted earnings per share:

$0.33 per share

 

Dividend declared - $0.17 per share

 

SHREWSBURY, NJ, October 29, 2015 — Wayside Technology Group, Inc. (NASDAQ: WSTG) today announced financial results for the third quarter ended September 30, 2015. The results will be discussed in a conference call to be held on Friday, October 30, 2015 at 10:00 a.m. EDT. The dial-in telephone number is (866) 847-7864 and the pass code is “WSTG.” This conference call will be webcast by NASDAQ OMX and can be accessed at Wayside Technology’s Web site at www.waysidetechnology.com/earnings-call.

 

Cash and long term receivables amounted to $25.8 million, representing 68% of equity as of September 30, 2015. Working capital amounted to $31.3 million, representing 82% of equity as of September 30, 2015.

 

“I am pleased to report solid financial results for Q3 2015. Overall, revenue increased 8%, gross profit increased 11% and income from operations increased 20% over the same period last year.” said Simon F. Nynens, Chairman and Chief Executive Officer.

 

Net sales for the third quarter ended September 30, 2015 increased 8% or $7.1 million to $97.7 million compared to $90.5 million for the same period in 2014. Total sales for the third quarter of 2015 for our Lifeboat Distribution segment were $86.1 million compared to $77.4 million in the third quarter of 2014, representing an increase of $8.7 million or 11%. Total sales for the third quarter of 2015 for our TechXtend segment were $11.6 million compared to $13.1 million in the third quarter of 2014, representing a decrease of $1.5 million or 12%.

 

The 11% increase in net sales for the Lifeboat Distribution segment was mainly a result of the addition of several key product lines and our ongoing strategy of strengthening of our account penetration. The 12% decrease in net sales in the TechXtend segment was primarily due to a decrease in extended payment terms sales transactions and other large sales transactions as compared to the same period in 2014.

 

Gross profit for the third quarter ended September 30, 2015 was $6.9 million, an 11% increase as compared to $6.2 million for the third quarter of 2014. Gross profit for our Lifeboat Distribution segment in the third quarter of 2015 was $5.5 million compared to $4.7 million for the third quarter of 2014, representing a 16% increase.  Gross profit for our TechXtend segment in the third quarter of 2015 was $1.4 million representing a 3% decrease from the prior year.

 

Gross profit margin (gross profit as a percentage of net sales) for the third quarter ended September 30, 2015 was 7.0% compared to 6.8% for the third quarter of 2014. Gross profit margin for the nine months ended September 30, 2015 was 7.0% compared to 7.2% in the same period in 2014. Gross profit margin for our Lifeboat Distribution segment for the third quarter of 2015 was 6.4% compared to 6.1% for the third quarter of 2014. The increase in gross profit margin for the Lifeboat Distribution segment was primarily caused by product mix and increased marketing funds. Gross profit for our TechXtend segment for the third quarter of 2015 was 12.0% compared to 10.9% for the third quarter of 2014.  The increase in gross profit margin for the TechXtend segment was primarily caused by the decrease in larger extended payment term sales transactions and other large sale transactions which typically carry lower margins.

 



 

Total selling, general, and administrative (“SG&A”) expenses for the third quarter of 2015 were $4.6 million compared to $4.3 million for the third quarter of 2014, representing an increase of $0.3 million or 8%.  This increase is primarily the result of an increase in sales related employee and employee related expenses. A large part of this increase is due to us hiring and creating a field sales team and a professional services team. As a percentage of net sales, SG&A expenses for the third quarter of 2015 and 2014 were 4.7%.

 

For the three months ended September 30, 2015, the Company recorded a provision for income taxes of $0.8 million or 34.1% of income, compared to $0.6 or 31.6% of income for the same period in 2014.

 

Net income and diluted earnings per share for the third quarter of 2015 were $1.6 million and $0.33, respectively, compared to $1.4 million and $0.29, respectively, for the third quarter of 2014.

 

On October 27, 2015, the Board of Directors declared a quarterly dividend of $.17 per share of its common stock payable November 17, 2015 to shareholders of record on November 10, 2015.

 

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 including Bluebeam Software, CA Technologies, Dell/Dell Software, ExaGrid Systems, Flexera Software, Hewlett Packard, Infragistics, Intel Software, Lenovo, Microsoft, Mindjet, Samsung, SmartBear Software, SolarWinds, Sophos, StorageCraft Technology, Super Micro Computer, Inc., TechSmith, Unitrends, Veeam Software 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 —

 

Investor Relations Contact:

Kevin Scull, Vice President and Chief Accounting Officer

Wayside Technology Group, Inc.

(732) 389-0932

Kevin.Scull@waysidetechnology.com

 



 

WAYSIDE TECHNOLOGY GROUP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

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

 

 

 

September
30,
2015

 

December
31,
2014

 

 

 

(unaudited)

 

 

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

Current assets

 

 

 

 

 

Cash and cash equivalents

 

$

19,607

 

$

23,124

 

Accounts receivable, net

 

56,916

 

60,782

 

Inventory, net

 

2,012

 

1,491

 

Prepaid expenses and other current assets

 

1,094

 

933

 

Deferred income taxes

 

179

 

245

 

Total current assets

 

79,808

 

86,575

 

 

 

 

 

 

 

Equipment and leasehold improvements, net

 

390

 

412

 

Accounts receivable long-term

 

6,139

 

7,660

 

Other assets

 

94

 

152

 

Deferred income taxes

 

182

 

182

 

 

 

 

 

 

 

Total assets

 

$

86,613

 

$

94,981

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

Accounts payable and accrued expenses

 

$

48,537

 

$

55,414

 

Total current liabilities

 

48,537

 

55,414

 

 

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity

 

 

 

 

 

Common stock, $.01 par value; 10,000,000 shares authorized, 5,284,500 shares issued, and 4,740,380 and 4,890,756 shares outstanding in 2015 and 2014, respectively

 

53

 

53

 

Additional paid-in capital

 

32,048

 

31,013

 

Treasury stock, at cost, 544,120 and 393,744 shares, respectively

 

(9,574

)

(6,166

)

Retained earnings

 

16,997

 

15,225

 

Accumulated other comprehensive loss

 

(1,448

)

(558

)

Total stockholders’ equity

 

38,076

 

39,567

 

Total liabilities and stockholders’ equity

 

$

86,613

 

$

94,981

 

 



 

WAYSIDE TECHNOLOGY GROUP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

( Amounts in thousands, except per share data)

 

 

 

Nine months ended

 

Three months ended

 

 

 

September 30,

 

September 30,

 

 

 

2015

 

2014

 

2015

 

2014

 

 

 

(Unaudited )

 

(Unaudited )

 

Revenues

 

 

 

 

 

 

 

 

 

Lifeboat segment

 

$

250,287

 

$

206,655

 

$

86,082

 

$

77,416

 

TechXtend segment

 

32,027

 

39,980

 

11,571

 

13,089

 

Total Revenue

 

282,314

 

246,635

 

97,653

 

90,505

 

 

 

 

 

 

 

 

 

 

 

Cost of sales

 

 

 

 

 

 

 

 

 

Lifeboat segment

 

234,450

 

193,180

 

80,589

 

72,670

 

TechXtend segment

 

28,202

 

35,602

 

10,184

 

11,659

 

Total Cost of sales

 

262,652

 

228,782

 

90,773

 

84,329

 

 

 

 

 

 

 

 

 

 

 

Gross Profit

 

19,662

 

17,853

 

6,880

 

6,176

 

 

 

 

 

 

 

 

 

 

 

Operating expenses

 

 

 

 

 

 

 

 

 

Selling costs

 

7,484

 

6,453

 

2,572

 

2,379

 

Share- based compensation

 

797

 

853

 

263

 

278

 

Other general and administrative expenses

 

5,252

 

4,987

 

1,783

 

1,634

 

Total Selling, general and administrative expenses

 

13,533

 

12,293

 

4,618

 

4,291

 

 

 

 

 

 

 

 

 

 

 

Income from operations

 

6,129

 

5,560

 

2,262

 

1,885

 

 

 

 

 

 

 

 

 

 

 

Interest income , net

 

297

 

375

 

100

 

121

 

Foreign currency transaction loss

 

(9

)

(8

)

(4

)

(4

)

Income before provision for income taxes

 

6,417

 

5,927

 

2,358

 

2,002

 

Provision for income taxes

 

2,199

 

2,016

 

805

 

632

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

4,218

 

$

3,911

 

$

1,553

 

$

1,370

 

 

 

 

 

 

 

 

 

 

 

Income per common share - Basic

 

$

0.91

 

$

0.84

 

$

0.34

 

$

0.29

 

 

 

 

 

 

 

 

 

 

 

Income per common share - Diluted

 

$

0.90

 

$

0.83

 

$

0.33

 

$

0.29

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding - Basic

 

4,652

 

4,639

 

4,624

 

4,716

 

Weighted average common shares outstanding - Diluted

 

4,673

 

4,685

 

4,643

 

4,736