Asure Software Reports Revenue and Financial Results for 2015 Third Quarter

Nov. 16, 2015 8:45 am

In thousands, except per share data  Q3 2015Q3 2014% ChangeYTD Q3 2015YTD Q3 2014% Change
Revenue $6,654 $7,030 down 5% $20,145 $20,105 up 0.2%
Gross Margin $4,904 $5,435 down 10% $14,864 $15,579 down 5%
Net income (loss) ($574)$161 down 457% ($962)($354)down 172%
EBIDTA, excluding one-times* $767 $1,382 down 45% $3,125 $3,701 down 16%
Diluted net income (loss) per share, excluding one-times* ($0.09)$0.04   ($0.09)$0.05  


AUSTIN, Texas, Nov. 16, 2015 (GLOBE NEWSWIRE) --  Asure Software, Inc. (Nasdaq:ASUR), a leading provider of workplace management software, announced results for the third quarter ended September 30, 2015.

Strategic Highlights

  • Rounded out Smart product platform by launching SmartWayTM indoor navigation mobile app in partnership with SPREO to enhance the mobile employee experience in the digital workplace.
  • Key strategic clients including Stanford University and Exxon Mobil expanded their resource scheduling investment with the addition of the SmartViewTM space utilization solution. New clients include Eileen Fisher and the Museum of Contemporary Art-Chicago.
  • Migrated 63 clients in the third quarter and 133 clients year to date from on-premise to on-demand products, representing a 186% and 73% increase over the prior year third quarter and nine month number of conversions, respectively. Key clients migrating to on-demand include: Town of Southampton, Startek, The Nemours Foundation, and Mestek.
  • Strong free cash flow of $1.1 million allowed for the full repayment of $722,000 in seller notes related to our Roomtag acquisition.


  • Cloud bookings in the quarter increased by 160% from the third quarter of 2014. Cloud bookings year to date increased by 66%, excluding PSSI, and 8%, including PSSI, over last year to date. 
  • Backlog as of September 30, 2015 is $3.2 million, up $968,000, or 44%, from September 30, 2014, and up $929,000, or 41% over last quarter. In 2016, we expect our enterprise clients to move through implementation, resulting in conversion from backlog to reported revenue growth.
  • Revenue for the quarter was $6.7 million and $20.1 million year to date as compared to $7.0 million in the third quarter of 2014 and $20.1 million last year to date, a decrease of 5% and a slight increase of 0.2%, respectively.
  • Recurring revenue as a percent of total revenue was 75% for the quarter as compared to 73% in the third quarter of 2014. This increase is primarily the result of strong hardware as a service revenue in the quarter.
  • Recurring revenue as a percent of total revenue was 74% year to date as compared to 76% last year to date.
  • Increased Hardware as a Service (HAAS) revenue was 194% compared to the third quarter of 2014 and increased 72% year to date as compared to year to date 2014.
  • Gross margin for the quarter was $4.9 million or 74%, down by 10%, from $5.4 million, or 77% in the third quarter of 2014. Year to date, gross margin was $14.9 million, or 74%, down from $15.6 million, or 77% last year to date. The decrease in gross margin percentage is primarily due to new product sales which have lower margins initially.  As these products mature and gain economies of scale, we anticipate a positive shift in these margins.
  • EBITDA* excluding one-time items* for the quarter was approximately $767,000 compared to $1.4 million in the third quarter of 2014, a decrease of 45%. Year to date, EBITDA * excluding one-time items* was approximately $3.1 million, compared to $3.7 million last year to date, a decrease of 16%.
  • Third quarter net (loss) income per share, excluding one-times*, was $0.09 loss compared to $0.04 income in the third quarter of 2014. Year to date net income per share, excluding one-times*, was $0.04 compared to $0.05 last year to date.
  • Cash flow provided by operating activities for the quarter was $1.1 million compared to $924,000 in the third quarter of 2014, representing an increase of 22%. Cash flow provided by operating activities year to date was $2.0 million, compared to $1.7 million year to date in 2014, an increase of 19%.

Pat Goepel, Chief Executive Officer of Asure Software commented, “Our earnings for the quarter were lower than expected.  While we attribute this to an increase in our backlog of implementations, we also generated strong cash flow in the quarter. As these enterprise clients move through implementation, we expect to see a positive impact to earnings.”

Brad Wolfe, Chief Financial Officer of Asure added, “Third quarter reported results reflect an increase in sales to enterprise clients, which drove an increase in backlog of $929,000 versus the prior quarter. We have adjusted our 2015 guidance as stated below and expect $7.1 million in revenue and $1.3 million in EBITDA in the fourth quarter. We also anticipate the fourth quarter to be another strong quarter from a cash generation perspective. We will introduce 2016 guidance on our first quarter conference call.”  

Please see below for details around Asure’s financial results.

Company Outlook 
$000sFY 15
Revenue$27,000 – $27,500
EBITDA, excluding one-time items$4,200 – $4,750
Net income per share, excluding one-time items$(0.04) – $0.04

Conference Call Details
Asure will follow this announcement with a conference call for the investment community on Monday, November 16, 2015 at 11:00 a.m. ET, (10:00 a.m. CT) to further discuss the quarter and outlook. Participating in the call will be Pat Goepel, Chief Executive Officer and Brad Wolfe, Chief Financial Officer. To participate, dial (877) 853-5636 ten minutes before the call begins. International callers should dial (631) 291-4544. The conference ID for all callers is 61780946.

Investors, analysts, media and the general public will also have the opportunity to listen to the conference call in listen-only mode via the Internet by visiting the investor relations on the Asure web site at To monitor the live call, please visit the web site at least ten minutes early to register, download and install any necessary audio software. For those who cannot listen to the live broadcast, an archived replay will be available shortly after the call at

About Asure Software
Asure Software, Inc., (Nasdaq:ASUR) is headquartered in Austin, Texas with regional headquarters in London, England. Asure helps companies better manage their global, mobile workforces with cloud-based and mobile solutions that bring people, time, space and assets together in a meaningful way. The company serves approximately 6,000 clients worldwide with workplace and workforce management solutions that offer innovative ways to help meet the needs of an agile workforce. For more information, please visit

The Asure Software, Inc. logo is available at

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995:

Statements in this press release regarding Asure's business, which are not historical facts, are "forward-looking statements" that involve risks and uncertainties. Such risks and uncertainties could cause actual results to differ from those contained in the forward-looking statements.

(Amounts in thousands)


Current assets:       
Cash and cash equivalents $122  $320 
Accounts receivable, net of allowance for doubtful accounts of $128 and $120 at September 30, 2015 and December 31, 2014, respectively  4,248   5,295 
Inventory  700   170 
Prepaid expenses and other current assets  1,556   1,303 
Total current assets  6,626   7,088 
Property and equipment, net  2,326   1,539 
Goodwill  17,438   17,500 
Intangible assets, net  6,485   8,322 
Other assets  766   19 
Total assets $ 33,641  $ 34,468 
Liabilities and stockholders’ equity        
Current liabilities:        
Current portion of notes payable $938  $750 
Accounts payable  2,092   1,533 
Accrued compensation and benefits  460   350 
Other accrued liabilities  1,318   1,128 
Deferred revenue  10,125   10,641 
Total current liabilities  14,933   14,402 
Long-term liabilities:        
Deferred revenue  769   475 
Notes payable  12,938   14,381 
Other liabilities  579   739 
Total long-term liabilities  14,286   15,595 
Stockholders’ equity:        
Preferred stock, $.01 par value; 1,500 shares authorized; none issued or outstanding  -   - 
Common stock, $.01 par value; 11,000 shares authorized; 6,674 and 6,434 shares issued, 6,290 and 6,050 shares outstanding at September 30, 2015 and December 31, 2014, respectively  67   64 
Treasury stock at cost, 384 shares at September 30, 2015 and December 31, 2014  (5,017)  (5,017)
Additional paid-in capital  279,574   278,656 
Accumulated deficit  (270,108)  (269,146)
Accumulated other comprehensive loss  (94)  (86)
Total stockholders’ equity  4,422   4,471 
Total liabilities and stockholders’ equity $33,641  $34,468 

(Amounts in thousands, except share and per share data)
September 30,
September 30,
  2015  2014  2015  2014 
Revenues $6,654  $7,030  $20,145  $20,105 
Cost of sales  1,750   1,595   5,281   4,526 
Gross margin  4,904   5,435   14,864   15,579 
Operating expenses                
Selling, general and administrative  3,866   3,553   10,926   10,410 
Research and development  786   868   2,267   2,444 
Amortization of intangible assets  505   494   1,514   1,488 
Total operating expenses  5,157   4,915   14,707   14,342 
Income (loss) from operations  (253)   520   157   1,237 
Other income (loss)                
Loss on lease termination  -   -   (110)  - 
Gain on settlement of note payable and litigation  -   -   -   1,034 
Loss on debt refinancing  (4)  -   (4)  (1,402)
Foreign currency translation gain (loss)  (5)  2   (13)  (10)
Interest expense and other  (266)  (288)  (828)  (1,009)
Interest expense- amortization of original issue discount (OID)  (3)  (10)  (19)  (64)
Total other loss, net  (278)  (296)  (974)  (1,451)
Income (loss) from operations before income taxes  (531    224   (817)  (214)
Income tax provision  (43)  (63)  (145)  (140)
Net income (loss) $(574 $161  $(962) $(354)
Other comprehensive income (loss):                
Foreign currency gain (loss)  27   14   (8)  (4)
Other comprehensive income (loss) $(547) $175  $(970) $(358)
Basic and diluted net income (loss) per share                
Basic $(0.09) $0.03  $(0.16) $(0.06)
Diluted $(0.09) $0.03  $(0.16) $(0.06)
Weighted average basic and diluted shares                
Basic  6,290,000   6,008,000   6,138,000   5,986,000 
Diluted  6,290,000   6,284,000   6,138,000   5,986,000 


(Amounts in thousands)
  2015  2014 
Net loss $ (962)  $(354)
Adjustments to reconcile net loss to net cash provided by operations:        
Depreciation and amortization   2,324    2,060 
Provision for doubtful accounts   70    20 
Share-based compensation   335    131 
Gain on settlement of note payable and litigation   -    (1,034)
Loss on debt refinancing   4    1,402 
Other   28    64 
Changes in operating assets and liabilities:        
Restricted cash   -    400 
Accounts receivable   977    182 
Inventory   (530   (241)
Prepaid expenses and other assets   (927)   (122)
Accounts payable   542    28 
Accrued expenses and other long-term obligations   354    150 
Deferred revenue   (222)   (1,015)
Net cash provided by operating activities   1,993    1,671 
Acquisitions net of cash acquired   -    (3,111)
Purchases of property and equipment   (1,290)   (385)
Disposals of property and equipment   18    38 
Collection/(Issuance) of note receivable   -    9 
Net cash used in investing activities   (1,272)   (3,449)
Proceeds from notes payable   4,250    18,179 
Payments on notes payable   (5,527)   (17,723)
Payments on amendment of senior notes payable   (75)   (704)
Debt financing fees   -    (565)
Payments on capital leases   (147)   (104)
Insurance proceeds for settlement of notes payable dispute, net of expenses   -    373 
Net proceeds from exercise of stock options   585    24 
Net cash used in financing activities   (914)   (520)
Effect of foreign exchange rates   (5)   (3)
Net decrease in cash and cash equivalents   (198)   (2,301)
Cash and cash equivalents at beginning of period   320    3,938 
Cash and cash equivalents at end of period $ 122   $1,637 
Cash paid for:        
Interest $ 597   $937 
Non-cash Investing and Financing Activities:        
Note receivable from customer   601     - 
Accrued contingent consideration upon acquisition   -    327 
Conversion of subordinated convertible notes payable to equity   -    249 
Accrued purchases of property and equipment   17    - 

*Non-GAAP Financial Measures
This press release includes the following financial measures defined as non-GAAP financial measures by the Securities and Exchange Commission: EBITDA and GAAP Net Income/(Loss) excluding one-time items. These supplemental financial measures are not required by GAAP, nor is the presentation of this financial information intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. Management recognizes that non-GAAP financial measures have limitations in that they do not reflect all of the items associated with Asure's earnings results as determined in accordance with GAAP. However, for the reasons described below, management uses these non-GAAP measures to evaluate the performance of Asure's business. Asure's management believes that it is important to provide investors with these same tools, together with reconciliation to GAAP, for evaluating the performance of Asure's business, as it may provide additional insight into Asure's financial results. See the “Reconciliation of GAAP Net Income/(Loss) to Earnings Before Interest, Taxes, Depreciation, Amortization and Stock Compensation Expense (EBITDA)” and the “Reconciliation of GAAP Net Income/(Loss) to Net Earnings Excluding One-Time Items” tables included in this press release for further information regarding these non-GAAP financial measures. In addition, these measures are presented because management believes they are frequently used by securities analysts, investors and others in the evaluation of companies. EBITDA is calculated by adding income taxes, interest expense, depreciation and amortization and stock compensation expense to net earnings. EBITDA is not defined under GAAP and should not be considered in isolation or as a substitute for net earnings and other consolidated earnings data prepared in accordance with GAAP or as a measure of Asure's profitability.

Net Earnings Excluding One-Time Items is calculated by combining the company’s GAAP Net Earnings, or earnings per share, with items that are one time in nature and are not expected to recur on a dollar or per share basis.

Free Cash Flow is computed by subtracting capital expenditures from cash flow from operations, each as determined in accordance with GAAP and as reflected in the statement of cash flows.

Reconciliation of GAAP Net Earnings to Earnings Before Interest, Taxes, Depreciation, Amortization and Stock Compensation Expense (EBITDA) and EBITDA Excluding One-time items

$000sSeptember 30,
September 30,
Net income (loss) (574)161
Interest and amortization of OID 269  298
Tax  43  63
Depreciation 160  115
Amortization 611 578
Stock Compensation  237  50
EBITDA 746 1,265
One-time items  21  117
EBITDA excluding one-time items 767 1,382

$000s September 30,

 September 30,

Net Loss (962) (354)
Interest and amortization of OID 847   1,073 
Tax 145   140  
Depreciation 492    337  
Amortization 1,832  1,723  
Stock Compensation 335   131 
EBITDA 2,689  3,050  
One-time items 
  436   651 
EBITDA excluding one-time items 3,125  3,701 

Reconciliation of GAAP Net Earnings to Net Earnings Excluding One-time items

$000s September 30, 
 September 30,
Net income (loss) (574)161
Legal & Professional Services 17 107
Severance, Recruitment & Relocation - -
Other one-time items (net) 4 10
Sub-total excluding Taxes 21 117
Sub-total one-time items 21 117
Net income (loss) excluding one-time items (553)278

$000s September 30,
  September 30,
Net Loss (962) (354 )
Loss on Debt Refinancing -  1,402 
Gain on Settlement of Note Payable and litigation  -  (1,034)
Legal & Professional Services 35  187  
Severance, Recruitment & Relocation 55  73  
Other one-time items (net) 346   23 
 Sub-total excluding Taxes 436  651 
Sub-total one-time items 436  651  
Net income(loss) excluding one-time items (526) 297  

For more information contact:

Brad Wolfe, CFO
Asure Software, Inc.

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November 16, 2015 - 8:45 AM EST

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