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ARC Reports $103.6 Million Net Revenue for Q1 2012

Wednesday, May 09, 2012

Press release from the issuing company

ARC, the nation's leading document solutions company for the architecture, engineering, and construction (AEC) industry, today reported its financial results for the first quarter ended March 31, 2012.

Business Highlights:
--  Q1 cash from operations at $12.4 million more than doubled year-over year; equates to $0.27 per share for Q1.
--  Year-over-year growth of more than 10% in FM/MPS for the fourth quarter in a row.
--  Senior secured credit facility remains undrawn.
--  Q1 adjusted earnings per share of $0.00.
--  Company affirms 2012 fully diluted annual adjusted earnings per share outlook of $0.05 to $0.10; annual cash from operations for 2012 remains projected at $40-50 million.

Financial Highlights:

 

Three Months Ended March 31

(All dollar figures in millions, except EPS)

2012

2011

Net Revenue

$ 103.6

$ 106.5

Gross Margin

30.80%

31.30%

Net (Loss) Income attributable to ARC (GAAP)

$ (4.9)

$ (3.6)

Adjusted Net (Loss) Income attributable to ARC

$ 0.01

$ (2.1)

EPS (GAAP)

S (0.11)

$ (0.08)

Adjusted EPS

$ 0.00

$ (0.05)

     

Cash from Operations

$ 12.4

$ 4.6

Capital Expenditures

$ 3.8

$ 4.1

Debt & Capital Leases

$ 226.5

$ 247.8


Management Commentary:
"Our revenues are still being pressured by the lack of new projects in the construction market, but our MPS initiatives are in high gear. We have had double-digit growth for the fourth quarter in a row, which we see as strong validation for our decision to pursue this line of business," said K. "Suri" Suriyakumar, Chairman, President and CEO of ARC. "Our aggressive efforts to drive sales across all lines of business are starting to show results. Not only have we seen significant gains in MPS, but we are also starting to see incremental growth in digital services thanks to our broad technology portfolio and the increasing adoption of technology by our customers. If these trends continue, we expect to see our growth rate increase later this year."

"While our revenue in traditional services remains under pressure, our operating income margin showed strong year-over-year growth due to the actions taken by management over the past year to better match costs with our revenue," said John Toth, ARC's Chief Financial Officer. "Additionally, our cash position and cash flow remain strong, enhanced by access to our undrawn senior secured credit facility. We are also aggressively managing our capital expenditures -- which are roughly flat year-over-year -- even though our FM/MPS revenue is growing at double digits."

Outlook:
ARC affirms annual adjusted earnings per share in 2012 to be in the range of $0.05 to $0.10 on a fully-diluted basis, and annual cash flow from operations to be in the range of $40 million to $50 million.

Teleconference and Webcast:
ARC will host a conference call and audio webcast today at 2:00 P.M. Pacific Time (5:00 P.M. Eastern Time) to discuss results for the company's first quarter of 2012. The conference call can be accessed by dialing (877) 402-8179. The conference ID number is 76603383.

A live Webcast will also be made available on the investor relations page of ARC's website at www.e-arc.com.

A replay will be available approximately one hour after the call for seven days following the call's conclusion. To access the replay, dial (855) 859-2056. The conference ID number to access the replay is 76603383. A Web archive will be made available at http://www.e-arc.com for approximately 90 days following the call's conclusion.

 

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