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InnerWorkings Announces Fourth Quarter and Full-Year 2016 Results

Friday, February 24, 2017

Press release from the issuing company

Fourth quarter gross profit (net revenue) increased 10% compared to prior year; record $140 million in new enterprise contracts signed in 2016 positions company for strong 2017

CHICAGO - InnerWorkings, Inc. (NASDAQ: INWK), the leading global marketing execution firm, today announced financial results for the three months and year ended December 31, 2016. For all non-GAAP references below, please refer to the non-GAAP reconciliation tables at the end of this release for more information.

"2016 was another record year of profitable growth and new client wins," said Eric D. Belcher, Chief Executive Officer of InnerWorkings. "The success of our strategy in developing global scale across a full suite of marketing execution solutions has yielded improving margins and we expect this trend to continue in 2017."

Fourth Quarter 2016 Highlights

  • Gross revenue was $270.4 million in the fourth quarter of 2016, slightly above $270.3 million in the fourth quarter of 2015.
  • Gross profit (net revenue) was $68.7 million, or 25.4% of gross revenue in the fourth quarter of 2016, a 10% increase compared to $62.5 million, or 23.1% of gross revenue, in the same period of last year.
  • Net income for the fourth quarter of 2016 was $5.0 million, or $0.09 per diluted share, which included a $0.8 million reduction in after-tax depreciation expense due to an estimate change (see below).
  • Non-GAAP diluted earnings per share for the fourth quarter of 2016 were $0.12, a 100% increase compared to $0.06 in the fourth quarter of 2015.
  • Non-GAAP adjusted EBITDA was $15.7 million in the fourth quarter of 2016, reflecting 20% growth as compared to $13.1 million in the fourth quarter of 2015.

Full-Year 2016 Highlights

  • Gross revenue in 2016 was $1,090.7 million, an increase of 6% compared with $1,029.4 million in 2015.
  • 2016 gross profit (net revenue) was $263.5 million, or 24.2% of gross revenue, an increase of 10% compared to $240.2 million, or 23.3% of gross revenue, in 2015.
  • Net income in 2016 was $4.4 million, or $0.08 per diluted share, and was heavily impacted by the accounting adjustment related to the increase in the value of contingent consideration for prior acquisitions.
  • 2016 non-GAAP diluted earnings per share were $0.38, an increase of 58% compared to $0.24 in 2015.
  • 2016 non-GAAP adjusted EBITDA was a record $59.2 million, a 16% increase compared to $50.8 million in 2015.
  • InnerWorkings signed new enterprise contracts during 2016 totaling $140 million of annual revenue at full run-rate, with nearly half stemming from expanded relationships with active clients.

"We ended the year on a very strong note, exceeding our revenue and non-GAAP diluted earnings per share guidance for 2016, even after raising our expectations in November," said Jeffrey P. Pritchett, Chief Financial Officer of InnerWorkings. "We enter 2017 well positioned to execute against our plan, with a robust backlog of new contractual revenue and a very strong balance sheet."


The Company expects 2017 annual revenue to range between $1.155 billion and $1.185 billion, representing growth of 6% to 9% compared to 2016. Non-GAAP adjusted EBITDA is expected to be between $65.0 million and $68.0 million in 2017, representing growth of 10% to 15% compared to 2016. The Company forecasts 2017 non-GAAP diluted earnings per share to be $0.44 to $0.47, representing growth of 16% to 24% compared to 2016.


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