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InnerWorkings Reports Revenue Growth and Sales Force Additions in Q1

Friday, May 11, 2007

Press release from the issuing company

Chicago, IL, May 9, 2007 – InnerWorkings, Inc., a leading provider of print procurement solutions to corporate clients in the United States, today reported record results for the three months ended March 31, 2007. Quarterly Highlights: * Revenue grew 163 percent versus the first quarter of 2006 to a record $58.9 million. * Operating income rose 177 percent to $3.8 million, up from $1.4 million in the first quarter of 2006. * Year-over-year enterprise revenue increased 113 percent to $35 million. * During the quarter the Company added seven new enterprise clients. * The Company increased its sales force through the addition of 12 new account executives during the quarter for a total of 163. * Diluted earnings per share were $0.05. Revenue for the Company's first quarter was $58.9 million, an increase of 163 percent compared to revenue of $22.4 million in the first quarter of 2006. Operating income was $3.8 million, an increase of 177 percent from $1.4 million during the same quarter of 2006. Operating income was 6.4 percent of revenue during the first quarter, up from 6.1 percent during the same quarter of the prior year. For the three months ended March 31, 2007, net income was $2.7 million, an increase of 222 percent from $0.8 million during the first quarter of 2006. For the quarter, diluted earnings per share were $0.05. “Our focused growth produced outstanding results, particularly given that the first quarter is not seasonally our strongest,” stated Steve Zuccarini, Chief Executive Officer of InnerWorkings. “The results indicate that our team continues to execute on our strategy, strengthening customer relationships and increasing our presence in the marketplace. During the quarter we had seven new enterprise wins, and we continue to see extremely positive results in the strategic investments we have made.” “While we continue to invest and add staff to build our business and capture market share, profitability remains a core objective. Our margins improved over the first quarter of 2006 and were in line with our expectations,” stated Nick Galassi, Chief Financial Officer of InnerWorkings. “At the same time, we’re encouraged by our integration efforts to date and the resulting efficiencies that have been realized.” Additional first quarter 2007 financial and operational highlights include the following: * For the first quarter of 2007, 60 percent of the Company’s revenue was generated from sales to enterprise clients, with the remaining 40 percent coming from transactional clients. * The Company had a cash and marketable securities balance of $66.0 million as of March 31, 2007. * The Company’s balance sheet contained no debt as of March 31, 2007. * In March 2007, the Company acquired Spectrum Printing Systems, a leading West Coast provider of print management services. Prior to its acquisition, Spectrum had five sales representatives and generated revenue of $12.9 million in 2006. Spectrum contributed $1.0 million in revenue in the first quarter of 2007. Outlook The Company continues to anticipate revenue for fiscal year 2007 in the range of $260 million to $280 million with resulting net income and diluted earnings per share in the ranges of $16.0 million to $17.0 million and $0.30 to $0.33, respectively. The Company’s diluted earnings per share reflect the new capital structure as of its IPO and follow-on offering. “We’re very proud of our team’s exceptional performance to start off the year, and we continue to have confidence in our short- and long-term prospects,” Zuccarini concluded. “Our sales pipeline is as robust as it has ever been, and we believe there remains abundant opportunity in the market for our model.”

 

 

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