Record third quarter gross revenue and gross profit (net revenue)
Raising earnings guidance for 2017
Year-to-date new business awards now over $100 million
CHICAGO - InnerWorkings, Inc. (NASDAQ: INWK), the leading global marketing execution firm, today announced financial results for the three months ended September 30, 2017. For all Non-GAAP references below, please refer to the non-GAAP reconciliation tables at the end of this release for more information.
Financial and Business Highlights
- Record gross revenue was $288.4 million in the third quarter, an increase of 3% compared with $280.0 million in the third quarter of 2016. Year-to-date gross revenue was $835.3 million, a 2% increase compared with $820.3 million in the prior period.
- Record gross profit (net revenue) was $72.5 million, or 25.1% of gross revenue in the third quarter, a 7% increase compared to $67.8 million, or 24.2% of gross revenue, in the same period of last year. Year-to-date gross profit (net revenue) was $207.0 million, or 24.8% of gross revenue, an increase of 6% compared to the prior-year period.
- Net income was $7.5 million or $0.14 per diluted share in the third quarter, compared to net income of $4.3 million or $0.08 per share in the third quarter of 2016. Year-to-date net income was $17.5 million or $0.32 per diluted share, compared to net income (loss) of $(0.7) million or $(0.01) per diluted share in the same period of 2016.
- Record non-GAAP diluted earnings per share was $0.15 in the third quarter, an increase of 46% compared to $0.11 in the third quarter of 2016. Year-to-date non-GAAP diluted earnings per share was $0.35, a 34% increase compared to $0.26 in the same period of 2016.
- Record non-GAAP adjusted EBITDA was $18.8 million in the third quarter, reflecting 11% growth as compared to $16.9 million in the third quarter of 2016. Year-to-date non-GAAP adjusted EBITDA was $47.7 million, an increase of 10% compared to $43.4 million in the same period of 2016.
- Non-GAAP adjusted EBITDA as a percentage of gross profit (net revenue) was 25.9% in the third quarter and 23.0% year to date, compared to 25.0% in the third quarter of 2016 and 22.3% for the first nine months of 2016.
- InnerWorkings has continued to sign new enterprise contracts in recent months, bringing the year-to-date cumulative total to more than $100 million of annual gross revenue at full run-rate.
- The largest of the new wins during the third quarter is a partnership with a Detroit-based financial services firm to manage the company's direct marketing and creative services execution.
"The investments we have made to build our global capabilities and technology platform are paying off in a meaningful way," said Eric D. Belcher, Chief Executive Officer of InnerWorkings. "Our large backlog of new business awards and pipeline of pursuits position us well for 2018 and beyond."
"We are continuing to improve our mix of high value-add services leading to stronger net revenue and profit performance," said Jeffrey P. Pritchett, Chief Financial Officer of InnerWorkings. "We expect 2017 to be another record year on both the top and bottom line."
The Company is raising its 2017 guidance for non-GAAP diluted earnings per share to be $0.47 to $0.50, compared to prior guidance of a range of $0.46 to $0.49. InnerWorkings is maintaining its 2017 gross revenue guidance to range between $1.115 billion and $1.145 billion and non-GAAP adjusted EBITDA to be between $65.0 million and $68.0 million.