News Feed Item

InnerWorkings Announces First Quarter 2014 Results

InnerWorkings, Inc. (NASDAQ: INWK), a leading global marketing supply chain company, today reported results for the three months ended March 31, 2014.


  • Revenue of $241.5 million was up 18%, compared to $204.6 million in the first quarter of 2013.
  • Non-GAAP Adjusted EBITDA of $8.5 million was up 26%, compared to Non-GAAP Adjusted EBITDA of $6.8 million in the first quarter of 2013. Please refer to the non-GAAP reconciliation table below for more information.
  • GAAP diluted earnings per share were $0.01, compared to a GAAP diluted loss per share of ($0.06) in the first quarter of 2013. Non-GAAP diluted earnings per share were $0.02, compared to Non-GAAP diluted earnings per share of $0.04 in the first quarter of 2013. Please refer to the non-GAAP reconciliation table below for more information.
  • Non-GAAP Adjusted Operating Cash Flow of ($8.4) million, compared to Non-GAAP Adjusted Operating Cash Flow of $0.1 million in the first quarter of 2013. Please refer to the non-GAAP reconciliation table below for more information.
  • The Company recently announced new significant client agreements with Callaway, Novartis and Pizza Hut.

"We executed against our plan in the first quarter and generated 12 percent organic enterprise revenue growth,” said Eric D. Belcher, Chief Executive Officer of InnerWorkings. “With a heightened focus on our core enterprise business and a growing contribution from our international segments, we expect to increase our operating leverage and improve our profitability as the year progresses.”

Additional financial and operational highlights include the following:

  • Organic enterprise account growth was $24 million in the first quarter, up 12% over the prior-year period.
  • The North America segment accounted for 69% of revenue and international segments accounted for 31%, compared to an 80% / 20% mix in the first quarter of 2013.
  • The Company has deployed its new technology into over 300 retail locations of a Fortune 500 partner serving small and mid-sized businesses. The progress represents nearly 20% of the full rollout plan, which is on track to be completed by the third quarter.

“Our new enterprise accounts are ramping up well,” said Joseph M. Busky, Chief Financial Officer of InnerWorkings. “Along with the progress we have made to restore our Productions Graphics business, we remain well positioned to hit our revenue and profit targets for the year.”

Revenue Growth - Comparing 2014 to 2013      

Q1 $(MM) Change


Q1 % Change

Organic Enterprise Account Growth $24 12 %
Loss of Spend from Large Customer 1 ($9 ) (4 )%
Acquisitive Growth $23 11 %
Total Revenue Growth $37     18 %
1 Includes loss of spending from large retail customer announced in April 2013.


The Company reaffirms its 2014 revenue guidance of $965 million to $1 billion, which reflects 8 to 12 percent growth over 2013. The Company also reaffirms its 2014 Non-GAAP diluted earnings per share guidance of $0.23 to $0.27, compared to $0.09 in 2013.

Conference Call

The management team will host a conference call to discuss the Company’s first quarter 2014 results, which will be broadcast live on Tuesday, May 13, 2014, at 10:00 a.m. Central Time (11:00 a.m. Eastern Time). The live webcast discussion, which will include a Q&A session, will be hosted by Eric D. Belcher, Chief Executive Officer, and Joseph M. Busky, Chief Financial Officer.

To access the conference call by telephone, interested parties may dial (877) 771-7024. Interested parties are also invited to listen to the live webcast by visiting the Investor "Events & Presentations" section of InnerWorkings' website at investor.inwk.com/events.cfm. A replay of the webcast will be available later that day in the same section of the website.

Non-GAAP Financial Measures

This press release includes the following financial measures defined as "non-GAAP financial measures" by the Securities and Exchange Commission: Non-GAAP Adjusted EBITDA, Non-GAAP Adjusted Operating Cash Flow and Non-GAAP diluted earnings per share. We believe that Non-GAAP Adjusted EBITDA, Non GAAP Adjusted Operating Cash Flow and Non-GAAP diluted earnings per share provide useful information to investors because they provide information about the estimated financial performance of the Company's ongoing business. Non-GAAP Adjusted EBITDA, Non-GAAP Adjusted Operating Cash Flow and Non-GAAP diluted earnings per share are used by management in its financial and operational decision-making and evaluation of overall operating performance. Non-GAAP Adjusted EBITDA, Non-GAAP Adjusted Operating Cash Flow and Non-GAAP diluted earnings per share may be different from similar measures used by other companies. The presentation of this financial information, which is not prepared under any comprehensive set of accounting rules or principles, is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with generally accepted accounting principles. For a reconciliation of these non-GAAP financial measures to the nearest comparable GAAP measures, see "Reconciliation of Non-GAAP Adjusted EBITDA, Non-GAAP Adjusted Operating Cash Flow and Non-GAAP diluted earnings per share” included in this release.

Forward-Looking Statements

This release contains statements relating to future results. These statements are forward- looking statements under the federal securities laws. We can give no assurance that any future results discussed in these statements will be achieved. Any forward-looking statements represent our views only as of today and should not be relied upon as representing our views as of any subsequent date. These statements are subject to a variety of risks and uncertainties that could cause our actual results to differ materially from the statements contained in this release. For a discussion of important factors that could affect our actual results, please refer to our SEC filings, including the "Risk Factors" section of our most recently filed Form 10-K.

About InnerWorkings

InnerWorkings, Inc. (NASDAQ: INWK) is a leading global marketing supply chain company servicing corporate clients across a wide range of industries. With proprietary technology, an extensive supplier network and deep domain expertise, the Company procures, manages and delivers printed materials and promotional products as part of a comprehensive outsourced enterprise solution. InnerWorkings is based in Chicago, IL, employs approximately 1,500 individuals, and maintains 67 global offices in 30 countries. Among the many industries InnerWorkings services are: retail, financial services, hospitality, non-profits, healthcare, food & beverage, broadcasting & cable, education, transportation and utilities. For more information, visit: www.inwk.com.

Condensed Consolidated Statements of Income (Unaudited)
Three Months Ended March 31,
2013 2014
Revenue $ 204,577,416 $ 241,489,664
Cost of goods sold   158,227,615     186,905,270  
Gross profit 46,349,801 54,584,394
Operating expenses:
Selling, general and administrative expenses 47,111,617 49,571,481
Depreciation and amortization 2,465,667 4,170,716
Change in fair value of contingent consideration   608,832     (695,177 )
Income (loss) from operations   (3,836,315 )   1,537,374  
Total other expense   (923,936 )   (1,115,673 )
Income (loss) before income taxes (4,760,251 ) 421,701
Income tax expense   (1,958,977 )   132,294  
Net income (loss) $ (2,801,274 ) $ 289,407  
Basic earnings (loss) per share $ (0.06 ) $ 0.01
Diluted earnings (loss) per share $ (0.06 ) $ 0.01
Weighted average shares outstanding, basic 50,338,994 51,312,649
Weighted average shares outstanding, diluted 50,338,994 52,189,091
Condensed Consolidated Balance Sheets    
December 31, March 31,
2013 2014
Cash and cash equivalents $ 18,606,030 $ 21,123,319
Accounts receivable, net of allowance for doubtful accounts 171,832,907 183,653,588
Unbilled revenue 27,483,544 28,721,863
Inventories 26,473,732 25,405,960
Prepaid expenses 11,746,965 11,369,450
Other current assets 23,528,025 29,802,949
Total long-term assets   334,995,575   337,646,241
Total assets $ 614,666,778 $ 637,723,370
Accounts payable-trade $ 169,243,349 $ 170,098,143
Other current liabilities 49,655,185 66,341,248
Revolving credit facility 69,000,000 85,000,000
Other long-term liabilities 81,326,670 69,070,730
Total stockholders' equity   245,441,574   247,213,249
Total liabilities and stockholders' equity $ 614,666,778 $ 637,723,370
Cash Flow Data    
Three Months Ended March 31,
2013 2014

Net cash used in operating activities

$ (842,639 ) $ (8,408,343 )
Net cash used in investing activities (9,148,187 ) (4,483,271 )

Net cash provided by financing activities

  3,540,144     15,431,352  
Effect of exchange rate changes on cash and cash equivalents   (159,046 )   (22,449 )

Increase (decrease) in cash and cash equivalents

(6,609,728 ) 2,517,289
Cash and cash equivalents, beginning of period   17,218,899     18,606,030  
Cash and cash equivalents, end of period $ 10,609,171   $ 21,123,319  

Reconciliation of Non-GAAP Adjusted EBITDA, Adjusted Operating Cash Flows and Non-GAAP Diluted EPS

Three Months Ended March 31,
2013 2014
Operating income (loss) $ (3,836,315 ) $ 1,537,374
Depreciation and amortization 2,465,667 4,170,716
Stock-based compensation expense 973,193 1,396,274
Change in fair value of contingent consideration 608,832 (695,177 )
Payments to former owner of Productions Graphics, net of cash recovered 6,308,660 -
Legal fees in connection with patent infringement defense 245,340 -
Restatement-related professional fees   -     2,093,104  

Non-GAAP Adjusted EBITDA

$ 6,765,377   $ 8,502,291  
Three Months Ended March 31,
2013 2014
Net cash used in operating activities $ (842,639 ) $ (8,408,343 )
Excess tax benefit from exercise of stock awards *  




Adjusted net cash provided by (used in) operating activities




$ (8,408,343 )

* Represents a U.S. tax deduction in an amount equal to the excess of the market price of the stock on the date of exercise over exercise price.

Three Months Ended March 31,
2013 2014
Net income (loss) $ (2,801,274 ) $ 289,407
Change in fair value of contingent consideration, net of tax 645,020 (536,797 )
Payments to former owner of Productions Graphics, net of cash recovered, net of tax 4,169,056 -
Legal fees in connection with patent infringement defense, net of tax 159,520 -
Restatement-related professional fees, net of tax   -     1,266,328  

Adjusted net income

$ 2,172,322 $ 1,018,938
Weighted average shares outstanding, diluted 50,338,994 52,189,091

Non-GAAP Diluted EPS

$ 0.04   $ 0.02  

More Stories By Business Wire

Copyright © 2009 Business Wire. All rights reserved. Republication or redistribution of Business Wire content is expressly prohibited without the prior written consent of Business Wire. Business Wire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
In his session at @ThingsExpo, Eric Lachapelle, CEO of the Professional Evaluation and Certification Board (PECB), provided an overview of various initiatives to certify the security of connected devices and future trends in ensuring public trust of IoT. Eric Lachapelle is the Chief Executive Officer of the Professional Evaluation and Certification Board (PECB), an international certification body. His role is to help companies and individuals to achieve professional, accredited and worldwide re...
Amazon started as an online bookseller 20 years ago. Since then, it has evolved into a technology juggernaut that has disrupted multiple markets and industries and touches many aspects of our lives. It is a relentless technology and business model innovator driving disruption throughout numerous ecosystems. Amazon’s AWS revenues alone are approaching $16B a year making it one of the largest IT companies in the world. With dominant offerings in Cloud, IoT, eCommerce, Big Data, AI, Digital Assista...
When growing capacity and power in the data center, the architectural trade-offs between server scale-up vs. scale-out continue to be debated. Both approaches are valid: scale-out adds multiple, smaller servers running in a distributed computing model, while scale-up adds fewer, more powerful servers that are capable of running larger workloads. It’s worth noting that there are additional, unique advantages that scale-up architectures offer. One big advantage is large memory and compute capacity...
You know you need the cloud, but you’re hesitant to simply dump everything at Amazon since you know that not all workloads are suitable for cloud. You know that you want the kind of ease of use and scalability that you get with public cloud, but your applications are architected in a way that makes the public cloud a non-starter. You’re looking at private cloud solutions based on hyperconverged infrastructure, but you’re concerned with the limits inherent in those technologies.
Both SaaS vendors and SaaS buyers are going “all-in” to hyperscale IaaS platforms such as AWS, which is disrupting the SaaS value proposition. Why should the enterprise SaaS consumer pay for the SaaS service if their data is resident in adjacent AWS S3 buckets? If both SaaS sellers and buyers are using the same cloud tools, automation and pay-per-transaction model offered by IaaS platforms, then why not host the “shrink-wrapped” software in the customers’ cloud? Further, serverless computing, cl...
The taxi industry never saw Uber coming. Startups are a threat to incumbents like never before, and a major enabler for startups is that they are instantly “cloud ready.” If innovation moves at the pace of IT, then your company is in trouble. Why? Because your data center will not keep up with frenetic pace AWS, Microsoft and Google are rolling out new capabilities. In his session at 20th Cloud Expo, Don Browning, VP of Cloud Architecture at Turner, posited that disruption is inevitable for comp...
Internet of @ThingsExpo, taking place October 31 - November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with 21st Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. The Internet of Things (IoT) is the most profound change in personal and enterprise IT since the creation of the Worldwide Web more than 20 years ago. All major researchers estimate there will be tens of billions devic...
IoT solutions exploit operational data generated by Internet-connected smart “things” for the purpose of gaining operational insight and producing “better outcomes” (for example, create new business models, eliminate unscheduled maintenance, etc.). The explosive proliferation of IoT solutions will result in an exponential growth in the volume of IoT data, precipitating significant Information Governance issues: who owns the IoT data, what are the rights/duties of IoT solutions adopters towards t...
It is ironic, but perhaps not unexpected, that many organizations who want the benefits of using an Agile approach to deliver software use a waterfall approach to adopting Agile practices: they form plans, they set milestones, and they measure progress by how many teams they have engaged. Old habits die hard, but like most waterfall software projects, most waterfall-style Agile adoption efforts fail to produce the results desired. The problem is that to get the results they want, they have to ch...
Wooed by the promise of faster innovation, lower TCO, and greater agility, businesses of every shape and size have embraced the cloud at every layer of the IT stack – from apps to file sharing to infrastructure. The typical organization currently uses more than a dozen sanctioned cloud apps and will shift more than half of all workloads to the cloud by 2018. Such cloud investments have delivered measurable benefits. But they’ve also resulted in some unintended side-effects: complexity and risk. ...
With the introduction of IoT and Smart Living in every aspect of our lives, one question has become relevant: What are the security implications? To answer this, first we have to look and explore the security models of the technologies that IoT is founded upon. In his session at @ThingsExpo, Nevi Kaja, a Research Engineer at Ford Motor Company, discussed some of the security challenges of the IoT infrastructure and related how these aspects impact Smart Living. The material was delivered interac...
No hype cycles or predictions of zillions of things here. IoT is big. You get it. You know your business and have great ideas for a business transformation strategy. What comes next? Time to make it happen. In his session at @ThingsExpo, Jay Mason, Associate Partner at M&S Consulting, presented a step-by-step plan to develop your technology implementation strategy. He discussed the evaluation of communication standards and IoT messaging protocols, data analytics considerations, edge-to-cloud tec...
The Internet giants are fully embracing AI. All the services they offer to their customers are aimed at drawing a map of the world with the data they get. The AIs from these companies are used to build disruptive approaches that cannot be used by established enterprises, which are threatened by these disruptions. However, most leaders underestimate the effect this will have on their businesses. In his session at 21st Cloud Expo, Rene Buest, Director Market Research & Technology Evangelism at Ara...
"When we talk about cloud without compromise what we're talking about is that when people think about 'I need the flexibility of the cloud' - it's the ability to create applications and run them in a cloud environment that's far more flexible,” explained Matthew Finnie, CTO of Interoute, in this SYS-CON.tv interview at 20th Cloud Expo, held June 6-8, 2017, at the Javits Center in New York City, NY.
A look across the tech landscape at the disruptive technologies that are increasing in prominence and speculate as to which will be most impactful for communications – namely, AI and Cloud Computing. In his session at 20th Cloud Expo, Curtis Peterson, VP of Operations at RingCentral, highlighted the current challenges of these transformative technologies and shared strategies for preparing your organization for these changes. This “view from the top” outlined the latest trends and developments i...