Record quarterly revenue with year-to-date gross profit up 10%
Over $100 million in new enterprise contracts signed year to date; raising full-year guidance
CHICAGO - InnerWorkings, Inc., the leading global marketing execution firm, today announced financial results for the three months ended September 30, 2016. For all non-GAAP references below, please refer to the non-GAAP reconciliation tables at the end of this release for more information.
- Gross revenue was $280.0 million in the third quarter, an increase of 5.8% compared with $264.7 million in the third quarter of 2015. Year-to-date gross revenue was $820.3 million, an increase of 8.1% compared with $759.0 million in the prior year period.
- Gross profit (net revenue) was $67.8 million, or 24.2% of gross revenue in the third quarter, a 6.6% increase compared to $63.6 million, or 24.0% of gross revenue, in the same period of last year. Year-to-date gross profit (net revenue) was $194.8 million, or 23.8% of gross revenue, an increase of 9.7% compared to the prior-year period.
- Net income for the third quarter was $4.3 million, or $0.08 per diluted share, and year-to-date net loss was $0.7 million or $0.01 per diluted share.
- Non-GAAP diluted earnings per share for the third quarter were $0.11, compared to $0.09 a year ago. Year-to-date non-GAAP diluted earnings per share were $0.26 compared to $0.18 in the same period of 2015.
- Non-GAAP adjusted EBITDA was $16.9 million in the third quarter, reflecting 5.4% growth as compared to $16.1 million in the third quarter of 2015. Year-to-date non-GAAP adjusted EBITDA was $43.4 million, an increase of 15.2% compared to $37.7 million in the same period of 2015.
- InnerWorkings has continued to sign new enterprise contracts in recent months, bringing the year-to-date collective total to more than $100 million of annual gross revenue at full run-rate, with about half stemming from expanded relationships with active clients.
- The largest of the new client contracts is expected to generate $10 million of annual revenue at full run-rate and makes InnerWorkings the preferred provider for marketing materials and direct mail, centralizing the marketing supply chain for a large U.S. media company.
- The largest increase of work within an existing account is an expansion of the Company's long-term partnership with a client in the healthcare industry, growing the account to more than $20 million of revenue by rolling out the existing print and creative services offering from one business unit to all of the company's U.S. and Canadian operations.
"We have devoted considerable energy to developing our presence in the international markets and new service offerings over the last few years, and the benefits of these investments are becoming more apparent," said Eric D. Belcher, Chief Executive Officer of InnerWorkings. "With the strength of our global capabilities and rate of penetration with our existing accounts, I'm excited by our performance and the path I see ahead for InnerWorkings."
"Our third quarter financial results demonstrate continued organic growth and further operating efficiency, particularly in our International segment," said Jeffrey P. Pritchett, Chief Financial Officer of InnerWorkings. "We are raising our financial performance expectations for 2016 as we continue to execute ahead of plan."
The Company is raising its guidance for 2016 annual revenue and non-GAAP diluted earnings per share. InnerWorkings now expects 2016 revenue to range between $1.075 billion and $1.082 billion, compared to previous guidance of $1.06 to $1.08 billion. Non-GAAP diluted earnings per share is now expected to be $0.31 to $0.34, versus prior guidance of $0.30 - $0.33. Guidance for non-GAAP adjusted EBITDA is unchanged at $58.0 million to $62.0 million.