– Fiscal year revenue of $236.3 million down 11% – Gross Merchandise
Volume (GMV) of $356.0 million down 1% – Adjusted earnings before
interest, taxes, depreciation and amortization (EBITDA) of $23.6 million
down 10% –
– Fourth quarter revenue of $62.9 million down 11% – GMV of $92.1
million down 8% – Adjusted EBITDA of $7.1 million even with last year –
WASHINGTON–(BUSINESS WIRE)–Dec. 3, 2009–
Liquidity Services, Inc. (NASDAQ:LQDT; www.liquidityservicesinc.com)
today reported its financial results for its fiscal year (FY-09) and
fourth quarter (Q4-09) ended September 30, 2009. Liquidity Services,
Inc. provides business and government clients and buying customers
transparent, innovative and effective online marketplaces and integrated
services for surplus assets.
Liquidity Services, Inc. (LSI or the Company) reported consolidated
FY-09 revenue of $236.3 million, a decrease of approximately 11% from
the prior year. Adjusted EBITDA for FY-09 was $23.6 million, a decrease
of approximately 10% from the prior year. FY-09 GMV, the total sales
volume of all merchandise sold through the Company’s marketplaces, was
$356.0 million, a decrease of approximately 1% from the prior year.
The Company reported consolidated Q4-09 revenue of $62.9 million, a
decrease of approximately 11% from the prior year’s comparable period.
Adjusted EBITDA for Q4-09 was $7.1 million, which was even with the
prior year’s comparable period. GMV was $92.1 million for Q4-09, a
decrease of approximately 8% from the prior year’s comparable period.
Net income in FY-09 was $5.7 million or $0.21 diluted earnings per
share. Adjusted net income in FY-09 was $8.4 million, a decrease of
approximately 41% from the prior year, or $0.30 adjusted diluted
earnings per share. Net income in Q4-09 was $0.6 million or $0.02
diluted earnings per share. Adjusted net income in Q4-09 was $0.9
million, a decrease of approximately 73% from the prior year’s
comparable period, or $0.03 adjusted diluted earnings per share. Net
income and adjusted net income for the year and the fourth quarter were
adversely affected by a sharp increase in the Company’s effective income
tax rate (from 46% to 58% for the year and 85% for the fourth quarter)
due to the recording of an allowance, during the fourth quarter, against
the deferred tax assets of our UK subsidiary, consisting principally of
net operating loss carryforwards. This does not affect cash taxes and
excluding this tax adjustment, adjusted diluted earnings per share for
the fourth quarter would have been $0.11 and $0.38 for the year.
We estimate that our future effective income tax rate will be
approximately 46%, which is comprised of (1) approximately 35% for
federal taxes, (2) approximately 8% for state taxes, and (3)
approximately 3% for book and tax differences including stock based
compensation expenses, primarily related to employee stock options,
which are currently expensed in our financial statements but are not
deductable for tax purposes until they are exercised.
“LSI generated solid results during Q4-09 in line with our guidance
range during a seasonally low quarter for the Company. GMV was up
slightly (2%) sequentially, driven by better than expected property mix
and volume in our scrap business. Adjusted EBITDA was in line with our
expectations, although we incurred higher than expected losses in our UK
business due to slower than expected ramp up from new sellers following
the loss of our largest UK seller last quarter due to their
restructuring,” said Bill Angrick, Chairman and CEO of LSI.
“Fiscal Year 2009 was a year with two distinct halves for LSI. The first
two quarters of the year were challenging for the business as: (i) our
commercial and municipal government sellers were severely impacted by
the economic downturn resulting in a material decrease in product flow
through our marketplaces; (ii) our scrap business was down more than 46%
as a result of a precipitous decline in commodity prices; and (iii) our
new Surplus Contract was delayed until February 2009. During this period
of uncertainty, LSI remained focused on executing our key initiatives to
ensure the Company was well positioned to drive long term results for
shareholders, including: (i) the successful launch of our new Surplus
contract, (ii) improving operations and service levels in our commercial
business, (iii) expanding the size and participation of our buyer base
and (iv) making our marketplaces easier to use. The results of these
efforts are reflected in the second half of FY09. Adjusted EBITDA grew
112% in the second half of the year compared to the first half. In
addition, Adjusted EBITDA margin improved significantly from 6.5% of
revenue and 4.4% of GMV in the first half of the year to 13.2% and 8.8%,
respectively for the second half of the year. We believe our continued
focus on driving operational efficiencies, investing in innovation and
enhancing value for our clients and buying customers positions us well
for fiscal year 2010 and continued long term profitable growth and
market leadership.” said Mr. Angrick.
“The operational foundation we created in the second half of FY-09 and
our financial strength will enable us to emerge as an even stronger
player in the reverse supply chain market during FY-10,” said Mr.
Angrick. “We plan to focus on the following key areas during FY-10 which
we believe will build long term value for our stockholders: (i) increase
the number of Fortune 1000 and municipal government clients selling on
our platform through expanded direct sales efforts and channel partner
relationships, (ii) develop new buyer channels and offerings to optimize
the net recovery for our clients, (iii) strengthen the branding of our
services and e-commerce marketplaces to buyers and sellers and (iv)
continue to enhance operations and service levels to improve the
customer experience.”
Business Outlook
While we are pleased with our recent progress, our overall outlook
remains cautious due to the economic environment and its impact on the
retail supply chain. We are in a period of economic uncertainty and
unprecedented market volatility which makes it more difficult for us to
forecast business trends and the timing of selected new programs,
resulting in a wider than usual guidance range. In the short term, we
believe changes in consumer spending patterns may reduce the overall
supply of goods in the reverse supply chain and the volume and value of
goods sold in our commercial marketplace. In the longer term, we expect
our business to benefit from the following trends: (i) as consumers
trade down and seek greater value, we anticipate stronger buyer demand
for the surplus merchandise sold in our marketplaces, (ii) as
corporations and public sector agencies focus on reducing costs,
improving transparency and working capital flows by outsourcing reverse
supply chain activities we expect our seller base to increase, and (iii)
as corporations and public sector agencies increasingly prefer service
providers with a proven track record and demonstrated financial
strength, we expect our competitive position to strengthen.
The following forward looking statements reflect the following trends
and assumptions for the next quarter and FY 2010:
| (i) | stabilized commodity prices in our scrap business; | |||
| (ii) |
stabilized average sales prices realized in our commercial, state and local government marketplaces; |
|||
| (iii) |
the wind down of property sales under our original Surplus Contract in the second quarter; |
|||
| (iv) |
the loss of approximately $16 million in GMV in our surplus |
|||
| (v) | an effective income tax rate of 46%; | |||
| (vi) |
improved operations and service levels in our commercial business, which we expect will continue to improve margins during the fiscal year; and |
|||
| (vii) |
our expectation that we will achieve less than optimal results in our U.K. business in the near term as we replace the lost volume from one of our major U.K. clients, which restructured their business. |
|||
Our results may also be materially affected by changes in business
trends and our operating environment, and by other factors, such as,
investments in infrastructure and value-added services to support new
business in both commercial and public sector markets.
Our Scrap contract with the DoD includes an incentive feature, which can
increase the amount of profit sharing distribution we receive from 23%
up to 25%. Payments under this incentive feature are based on the amount
of scrap we sell for the DoD to small businesses during the preceding 12
months as of June 30th of each year. We are eligible to
receive this incentive in each year of the term of the Scrap contract
and have assumed for purposes of providing guidance regarding our
projected financial results for fiscal year 2010 that we will again
receive this incentive payment.
GMV – We expect GMV for fiscal
year 2010 to range from $360 million to $400 million. We expect GMV for
Q1-10 to range from $82 million to $92 million.
Adjusted EBITDA – We expect
Adjusted EBITDA for fiscal year 2010 to range from $26 million to $30
million. We expect Adjusted EBITDA for Q1-10 to range from $6.0 million
to $7.0 million.
Adjusted Diluted EPS – We estimate
Adjusted Earnings Per Diluted Share for fiscal year 2010 to range from
$0.40 to $0.48. In Q1-10, we estimate Adjusted Earnings Per Diluted
Share to be $0.09 to $0.11.
Our guidance adjusts EBITDA and Diluted EPS for the effects of FAS
123(R), which we estimate to be approximately $2.0 million to $2.2
million per quarter for fiscal year 2010. The Company expects its trend
of increasing stock based compensation costs to moderate in fiscal year
2011.
Key FY-09 and Q4-09 Operating Metrics
Registered Buyers — At the end of
FY-09, registered buyers totaled approximately 1,202,000, representing a
20% increase over the approximately 999,000 registered buyers at the end
of FY-08.
Auction Participants — Auction
participants, defined as registered buyers who have bid in an auction
during the period (a registered buyer who bids in more than one auction
is counted as an auction participant in each auction in which he or she
bids), increased to approximately 2,118,000 in FY-09, an approximately
21% increase over the approximately 1,751,000 auction participants in
FY-08. Auction participants increased to approximately 521,000 in Q4-09,
an approximately 12% increase over the approximately 467,000 auction
participants in Q4-08.
Completed Transactions — Completed
transactions increased to approximately 469,000, an approximately 26%
increase for FY-09 from the approximately 372,000 completed transactions
in FY-08. Completed transactions increased to approximately 121,000, an
approximately 10% increase for Q4-09 from the approximately 109,000
completed transactions in Q4-08.
GMV and Revenue Mix — GMV and
revenue continue to diversify, as a result, the percentage of GMV and
revenue derived from our DoD Contracts during FY-09 decreased to 36.0%
and 54.3%, respectively, compared to 45.8% and 62.4%, respectively, in
FY-08. The table below summarizes GMV and revenue by pricing model.
|
GMV Mix |
||||||||
| FY-09 | FY-08 | Q4-09 | Q4-08 | |||||
| Profit-Sharing Model: | ||||||||
| Original Surplus Contract | 12.8% | 23.0% | 3.7% | 22.8% | ||||
| Scrap | 14.2% | 22.8% | 18.1% | 20.9% | ||||
| Total Profit Sharing | 27.0% | 45.8% | 21.8% | 43.7% | ||||
| Consignment Model: | ||||||||
| GovDeals | 21.4% | 15.2% | 22.2% | 17.9% | ||||
| Commercial – US | 19.6% | 17.9% | 15.5% | 18.0% | ||||
| Total Consignment | 41.0% | 33.1% | 37.7% | 35.9% | ||||
| Purchase Model: | ||||||||
| Commercial – US | 18.0% | 17.3% | 17.7% | 14.2% | ||||
| New Surplus Contract | 9.0% | — | 17.9% | — | ||||
| Commercial – International | 3.6% | 2.0% | 3.5% | 4.2% | ||||
| Total Purchase | 30.6% | 19.3% | 39.1% | 18.4% | ||||
| Other | 1.4% | 1.8% | 1.4% | 2.0% | ||||
| Total | 100.0% | 100.0% | 100.0% | 100.0% | ||||
|
Revenue Mix |
||||||||
| FY-09 | FY-08 | Q4-09 | Q4-08 | |||||
| Profit-Sharing Model: | ||||||||
| Original Surplus Contract | 19.2% | 31.3% | 5.5% | 32.2% | ||||
| Scrap | 21.5% | 31.1% | 26.5% | 29.6% | ||||
|
Total Profit Sharing |
40.7% | 62.4% | 32.0% | 61.8% | ||||
| Consignment Model: | ||||||||
| GovDeals | 2.5% | 1.5% | 2.7% | 2.0% | ||||
| Commercial – US | 8.1% | 6.1% | 5.7% | 6.2% | ||||
| Total Consignment | 10.6% | 7.6% | 8.4% | 8.2% | ||||
| Purchase Model: | ||||||||
| Commercial – US | 27.1% | 23.5% | 26.0% | 20.2% | ||||
| New Surplus Contract | 13.6% | — | 26.2% | — | ||||
| Commercial – International | 5.4% | 2.7% | 5.1% | 6.0% | ||||
| Total Purchase | 46.1% | 26.2% | 57.3% | 26.2% | ||||
| Other | 2.6% | 3.8% | 2.3% | 3.8% | ||||
| Total | 100.0% | 100.0% | 100.0% | 100.0% | ||||
Liquidity Services, Inc.
Reconciliation of GAAP to Non-GAAP
Measures
EBITDA and Adjusted EBITDA.
EBITDA is a supplemental non-GAAP financial measure and is equal to net
income less (a) interest income and other income, net; plus
(b) provision for income taxes; (c) amortization of contract
intangibles; and (d) depreciation and amortization. Our definition of
Adjusted EBITDA differs from EBITDA because we further adjust EBITDA for
stock based compensation expense.
|
Three Months Ended September 30, |
Twelve Months Ended September 30, |
|||||||||||
| 2009 | 2008 | 2009 | 2008 | |||||||||
| (In thousands) | ||||||||||||
| Net income | $ 642 | $ 2,697 | $5,719 | $11,553 | ||||||||
| Interest income and other income, net | (157 | ) | (93 | ) | (516 | ) | (1,495 | ) | ||||
| Provision for income taxes | 3,636 | 2,369 | 7,961 | 8,546 | ||||||||
| Amortization of contract intangibles | 203 | 203 | 813 | 813 | ||||||||
| Depreciation and amortization | 971 | 647 | 3,116 | 2,083 | ||||||||
| EBITDA | 5,295 | 5,823 | 17,093 | 21,500 | ||||||||
| Stock compensation expense | 1,764 | 1,234 | 6,465 | 4,674 | ||||||||
| Adjusted EBITDA | $7,059 | $7,057 | $23,558 | $26,174 | ||||||||
Adjusted Net Income and Adjusted Basic
and Diluted Earnings Per Share. Adjusted net income is a
supplemental non-GAAP financial measure and is equal to net income plus
tax effected stock compensation expense. Adjusted basic and diluted
earnings per share are determined using Adjusted Net Income.
|
Three Months Ended
September 30, |
Twelve Months Ended
September 30, |
|||||||||||
| 2009 | 2008 | 2009 | 2008 | |||||||||
| (Dollars in thousands, except per share data) | ||||||||||||
| Net income | $ | 642 | $ | 2,697 | $ | 5,719 | $ | 11,553 | ||||
| Stock compensation expense (net of tax) | 265 | 657 | 2,702 | 2,687 | ||||||||
| Adjusted net income | $ | 907 | $ | 3,354 | $ | 8,421 | $ | 14,240 | ||||
| Adjusted basic earnings per common share | $ | 0.03 | $ | 0.12 | $ | 0.30 | $ | 0.51 | ||||
| Adjusted diluted earnings per common share | $ | 0.03 | $ | 0.12 | $ | 0.30 | $ | 0.51 | ||||
| Basic weighted average shares outstanding | 27,528,902 | 27,998,413 | 27,699,223 | 27,964,748 | ||||||||
| Diluted weighted average shares outstanding | 27,831,815 | 28,001,549 | 27,846,693 | 28,151,878 | ||||||||
Conference Call
The Company will host a conference call to discuss the fiscal 2009 and
fourth quarter 2009 results at 5 p.m. Eastern Time today. Investors and
other interested parties may access the teleconference by dialing
866-202-4367 or 617-213-8845 and providing the participant pass code
84652431. A live web cast of the conference call will be provided on the
Company’s investor relations website at http://www.liquidityservicesinc.com.
A replay of the web cast will be available on the Company’s website for
30 calendar days ending January 3, 2010 at 11:59 p.m. ET. An audio
replay of the teleconference will also be available until January 3,
2010 at 11:59 p.m. ET. To listen to the replay, dial 888-286-8010 or
617-801-6888 and provide pass code 88976698. Both replays will be
available starting at 8:00 p.m. on the day of the call.
Non-GAAP Measures
To supplement our consolidated financial statements presented in
accordance with GAAP, we use certain non-GAAP measures of certain
components of financial performance. These non-GAAP measures include
earnings before interest, taxes, depreciation and amortization (EBITDA),
Adjusted EBITDA, Adjusted Net Income and Adjusted Earnings Per Share.
These non-GAAP measures are provided to enhance investors’ overall
understanding of our current financial performance and prospects for the
future. We use EBITDA and Adjusted EBITDA: (a) as measurements of
operating performance because they assist us in comparing our operating
performance on a consistent basis as they do not reflect the impact of
items not directly resulting from our core operations; (b) for planning
purposes, including the preparation of our internal annual operating
budget; (c) to allocate resources to enhance the financial performance
of our business; (d) to evaluate the effectiveness of our operational
strategies; and (e) to evaluate our capacity to fund capital
expenditures and expand our business.
We believe these non-GAAP measures provide useful information to both
management and investors by excluding certain expenses that may not be
indicative of our core operating measures. In addition, because we have
historically reported certain non-GAAP measures to investors, we believe
the inclusion of non-GAAP measures provides consistency in our financial
reporting. These measures should be considered in addition to financial
information prepared in accordance with generally accepted accounting
principles, but should not be considered a substitute for, or superior
to, GAAP results. A reconciliation of all non-GAAP measures included in
this press release, to the most directly comparable GAAP measures, can
be found in the financial tables included in this press release.
Supplemental Operating Data
To supplement our consolidated financial statements presented in
accordance with GAAP, we use certain supplemental operating data as a
measure of certain components of operating performance. We review GMV
because it provides a measure of the volume of goods being sold in our
marketplaces and thus the activity of those marketplaces. GMV and our
other supplemental operating data, including registered buyers, auction
participants and completed transactions, also provide a means to
evaluate the effectiveness of investments that we have made and continue
to make in the areas of customer support, value-added services, product
development, sales and marketing and operations. Therefore, we believe
this supplemental operating data provides useful information to both
management and investors. In addition, because we have historically
reported certain supplemental operating data to investors, we believe
the inclusion of this supplemental operating data provides consistency
in our financial reporting. This data should be considered in addition
to financial information prepared in accordance with generally accepted
accounting principles, but should not be considered a substitute for, or
superior to, GAAP results.
Forward-Looking Statements
This document contains forward-looking statements made pursuant to the
Private Securities Litigation Reform Act of 1995. These
statements are only predictions. The outcome of the events described in
these forward-looking statements is subject to known and unknown risks,
uncertainties and other factors that may cause our actual results,
levels of activity, performance or achievements to differ materially
from any future results, levels of activity, performance or achievements
expressed or implied by these forward-looking statements. These
statements include, but are not limited to, statements regarding the
Company’s business outlook and expected future effective tax rates. You
can identify forward-looking statements by terminology such as “may,”
“will,” “should,” “could,” “would,” “expects,” “intends,” “plans,”
“anticipates,” “believes,” “estimates,” “predicts,” “potential,”
“continues” or the negative of these terms or other comparable
terminology. Although we believe that the expectations reflected in the
forward-looking statements are reasonable, we cannot guarantee future
results, levels of activity, performance or achievements.
There are a number of risks and uncertainties that could cause our
actual results to differ materially from the forward-looking statements
contained in this document. Important factors that could cause our
actual results to differ materially from those expressed as
forward-looking statements are set forth in our filings with the SEC
from time to time, and include, among others, our dependence on our
contracts with the DoD for a significant portion of our revenue and
profitability; our ability to successfully expand the supply of
merchandise available for sale on our online marketplaces; our ability
to attract and retain active professional buyers to purchase this
merchandise; and our ability to successfully complete the integration of
any acquired companies into our existing operations. There may be other
factors of which we are currently unaware or deem immaterial that may
cause our actual results to differ materially from the forward-looking
statements.
All forward-looking statements attributable to us or persons acting on
our behalf apply only as of the date of this document and are expressly
qualified in their entirety by the cautionary statements included in
this document. Except as may be required by law, we undertake no
obligation to publicly update or revise any forward-looking statement to
reflect events or circumstances occurring after the date of this
document or to reflect the occurrence of unanticipated events.
About LSI
LSI enables buyers and sellers to transact in an efficient, automated
online auction environment. The Company’s marketplaces provide
professional buyers access to a global, organized supply of wholesale
surplus and salvage assets presented with digital images and other
relevant product information. Additionally, LSI enables its corporate
and government sellers to enhance their financial return on excess
assets by providing a liquid marketplace and value-added services that
are integrated into a single offering. The Company organizes its
products into categories across major industry verticals such as
consumer electronics, general merchandise, apparel, scientific
equipment, aerospace parts and equipment, technology hardware, and scrap
metals. The Company’s online auction marketplaces are www.liquidation.com,
www.govliquidation.com,
www.govdeals.com
and www.liquibiz.com.
LSI also operates a wholesale industry portal, www.goWholesale.com,
that connects advertisers with buyers seeking products for resale and
related business services.
| Liquidity Services, Inc. and Subsidiaries | ||||||||
| Consolidated Balance Sheets | ||||||||
| (Dollars in Thousands) | ||||||||
| September 30, | ||||||||
| 2009 | 2008 | |||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 33,538 | $ | 51,954 | ||||
| Short-term investments | 30,616 | 11,244 | ||||||
|
Accounts receivable, net of allowance for doubtful accounts of $613 and $519 in 2009 and 2008, respectively |
4,243 | 4,658 | ||||||
| Inventory | 14,280 | 13,327 | ||||||
| Prepaid expenses, deferred taxes and other current assets | 8,705 | 7,653 | ||||||
| Total current assets | 91,382 | 88,836 | ||||||
| Property and equipment, net | 6,147 | 4,730 | ||||||
| Intangible assets, net | 4,203 | 5,561 | ||||||
| Goodwill | 33,738 | 34,696 | ||||||
| Other assets | 3,118 | 3,344 | ||||||
| Total assets | $ | 138,588 | $ | 137,167 | ||||
| Liabilities and stockholders’ equity | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 5,456 | $ | 8,303 | ||||
| Accrued expenses and other current liabilities | 14,740 | 10,314 | ||||||
| Profit-sharing distributions payable | 4,538 | 10,312 | ||||||
| Customer payables | 6,797 | 8,841 | ||||||
| Current portion of capital lease obligations | 56 | 22 | ||||||
| Total current liabilities | 31,587 | 37,792 | ||||||
| Capital lease obligations, net of current portion | 82 | 44 | ||||||
| Deferred taxes and other long-term liabilities | 2,937 | 2,961 | ||||||
| Total liabilities | 34,606 | 40,797 | ||||||
| Stockholders’ equity: | ||||||||
|
Common stock, $0.001 par value; 120,000,000 shares authorized; 28,271,983 shares issued and 27,564,521 shares outstanding at September 30, 2009; 28,023,361 shares issued and outstanding at September 30, 2008 |
28 | 28 | ||||||
| Additional paid-in capital | 73,641 | 65,973 | ||||||
| Treasury stock, at cost | (3,874 | ) | — | |||||
| Accumulated other comprehensive loss | (3,618 | ) | (1,717 | ) | ||||
| Retained earnings | 37,805 | 32,086 | ||||||
| Total stockholders’ equity | 103,982 | 96,370 | ||||||
| Total liabilities and stockholders’ equity | $ | 138,588 | $ | 137,167 | ||||
| Liquidity Services, Inc. and Subsidiaries | ||||||||||||||||
| Consolidated Statements of Operations | ||||||||||||||||
| (Dollars in Thousands, Except Share and Per Share Data) | ||||||||||||||||
|
Three Months Ended
September 30, |
Twelve Months Ended
September 30, |
|||||||||||||||
| 2009 | 2008 | 2009 | 2008 | |||||||||||||
| Revenue | $ | 62,920 | $ | 70,362 | $ | 236,283 | $ | 263,941 | ||||||||
| Costs and expenses: | ||||||||||||||||
| Cost of goods sold (excluding amortization) | 24,611 | 20,186 | 86,591 | 71,303 | ||||||||||||
| Profit-sharing distributions | 11,102 | 23,469 | 45,333 | 91,106 | ||||||||||||
| Technology and operations | 11,460 | 10,824 | 46,479 | 41,512 | ||||||||||||
| Sales and marketing | 4,951 | 4,478 | 18,253 | 16,997 | ||||||||||||
| General and administrative | 5,501 | 5,582 | 22,534 | 21,523 | ||||||||||||
| Amortization of contract intangibles | 203 | 203 | 813 | 813 | ||||||||||||
| Depreciation and amortization | 971 | 647 | 3,116 | 2,083 | ||||||||||||
| Total costs and expenses | 58,799 | 65,389 | 223,119 | 245,337 | ||||||||||||
| Income from operations | 4,121 | 4,973 | 13,164 | 18,604 | ||||||||||||
| Interest income and other income, net | 157 | 93 | 516 | 1,495 | ||||||||||||
| Income before provision for income taxes | 4,278 | 5,066 | 13,680 | 20,099 | ||||||||||||
| Provision for income taxes | (3,636 | ) | (2,369 | ) | (7,961 | ) | (8,546 | ) | ||||||||
| Net income | $ | 642 | $ | 2,697 | $ | 5,719 | $ | 11,553 | ||||||||
| Basic earnings per common share | $ | 0.02 | $ | 0.10 | $ | 0.21 | $ | 0.41 | ||||||||
| Diluted earnings per common share | $ | 0.02 | $ | 0.10 | $ | 0.21 | $ | 0.41 | ||||||||
| Basic weighted average shares outstanding | 27,528,902 | 27,998,413 | 27,699,223 | 27,964,748 | ||||||||||||
| Diluted weighted average shares outstanding | 27,831,815 | 28,001,549 | 27,846,693 | 28,151,878 | ||||||||||||
| Liquidity Services, Inc. and Subsidiaries | ||||||||||||||||
| Consolidated Statements of Cash Flows | ||||||||||||||||
| (In Thousands) | ||||||||||||||||
|
Three Months Ended
September 30, |
Twelve Months Ended
September 30, |
|||||||||||||||
| 2009 | 2008 | 2009 | 2008 | |||||||||||||
| Operating activities | ||||||||||||||||
| Net income | $ | 642 | $ | 2,697 | $ | 5,719 | $ | 11,553 | ||||||||
|
Adjustments to reconcile net income to net cash provided by operating activities: |
||||||||||||||||
| Depreciation and amortization | 1,175 | 850 | 3,929 | 2,895 | ||||||||||||
| Stock compensation expense | 1,763 | 1,234 | 6,465 | 4,674 | ||||||||||||
| Provision (benefit) for doubtful accounts | 148 | (672 | ) | 93 | (736 | ) | ||||||||||
| Deferred tax benefit | (1,534 | ) | (1,305 | ) | (1,534 | ) | (1,305 | ) | ||||||||
| Changes in operating assets and liabilities: | ||||||||||||||||
| Accounts receivable | (632 | ) | 261 | 356 | 2,107 | |||||||||||
| Inventory | (795 | ) | 3,311 | (801 | ) | 4,615 | ||||||||||
| Prepaid expenses and other assets | 3,139 | 1,571 | 475 | (405 | ) | |||||||||||
| Accounts payable | (200 | ) | (598 | ) | (2,848 | ) | 2,602 | |||||||||
| Accrued expenses and other | (925 | ) | 2,506 | 4,427 | (2,030 | ) | ||||||||||
| Profit-sharing distributions payable | 1,300 | 2,297 | (5,773 | ) | 3,393 | |||||||||||
| Customer payables | 535 | 1,154 | (2,088 | ) | 2,512 | |||||||||||
| Other liabilities | (43 | ) | (892 | ) | 215 | (884 | ) | |||||||||
| Net cash provided by operating activities | 4,573 | 12,414 | 8,635 | 28,991 | ||||||||||||
| Investing activities | ||||||||||||||||
| Purchases of short-term investments | (14,457 | ) | (10,874 | ) | (35,113 | ) | (36,180 | ) | ||||||||
| Proceeds from the sale of short-term investments | 5,722 | 357 | 15,737 | 46,400 | ||||||||||||
| Increase in goodwill and intangibles and cash paid for acquisitions | (793 | ) | 4 | (954 | ) | (25,664 | ) | |||||||||
| Purchases of property and equipment | (917 | ) | (427 | ) | (3,681 | ) | (1,669 | ) | ||||||||
| Net cash used in investing activities | (10,445 | ) | (10,940 | ) | (24,011 | ) | (17,113 | ) | ||||||||
| Financing activities | ||||||||||||||||
| Principal repayments of capital lease obligations and debt | (14 | ) | (5 | ) | (27 | ) | (51 | ) | ||||||||
|
Proceeds from exercise of common stock options and warrants (net of tax) |
132 | 237 | 1,081 | 345 | ||||||||||||
| Incremental tax benefit from exercise of common stock options | 62 | 115 | 121 | 133 | ||||||||||||
| Repurchases of common stock | — | — | (3,874 | ) | — | |||||||||||
| Net cash provided by (used in) financing activities | 180 | 347 | (2,699 | ) | 427 | |||||||||||
| Effect of exchange rate differences on cash and cash equivalents | (224 | ) | (489 | ) | (341 | ) | (305 | ) | ||||||||
| Net increase (decrease) in cash and cash equivalents | (5,916 | ) | 1,332 | (18,416 | ) | 12,000 | ||||||||||
| Cash and cash equivalents at beginning of the period | 39,454 | 50,622 | 51,954 | 39,954 | ||||||||||||
| Cash and cash equivalents at end of period | $ | 33,538 | $ | 51,954 | $ | 33,538 | $ | 51,954 | ||||||||
| Supplemental disclosure of cash flow information | ||||||||||||||||
| Property and equipment acquired through capital leases | — | $ | 65 | $ | 100 | $ | 65 | |||||||||
| Cash paid for income taxes | $ | 2,088 | 2,276 | 9,215 | 11,656 | |||||||||||
| Cash paid for interest | 4 | 3 | 44 | 23 | ||||||||||||
Source: Liquidity Services, Inc.
Liquidity Services, Inc.
Julie Davis
Director, Investor
Relations
202-467-6868 ext. 2234
[email protected]
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