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PFSweb Reports Fourth Quarter And Year-End 2011 Results

PFSweb, Inc. (Nasdaq: PFSW), an international provider of end-to-end web commerce solutions, today announced its financial results for the fourth quarter and year ended December 31, 2011.

“We are pleased to report that our Service Fee business segment reported record revenue for the December 2011 quarter of $32.5 million, an increase of 50% compared to the prior year,” stated Mark Layton, Chairman and Chief Executive Officer of PFSweb. “On a year-to-date basis, service fee revenues were $95.3 million in 2011, an increase of 35% compared to the prior year. The strong increases for the 2011 fourth quarter and yearly results were attributable to organic growth of existing clients as well as new client programs launched during the year, and included the benefit of strong holiday season ecommerce activity of our clients.”

“Our Adjusted EBITDA for the December quarter was a record $3.9 million, resulting in Adjusted EBITDA of $6.1 million for calendar 2011, which was within our guidance for the year. Our gross margin and SG&A results were impacted both during the fourth quarter and during the full year by certain infrastructure investments and expenses to support our growth, including incremental costs related to promotional sales events on clients’ e-commerce sites,” continued Mr. Layton.

Summary of consolidated results for the fourth quarter ended December 31, 2011:

  • Total revenue increased 15% to $87.5 million for the fourth quarter of 2011, compared to $76.3 million for fourth quarter of 2010;
  • Service Fee revenue increased 50% to $32.5 million, compared to $21.7 million for the same period in 2010;
  • Adjusted EBITDA (as defined) was $3.9 million for the fourth quarter of 2011, compared to $2.6 million for the same period in 2010;
  • Net income was $0.8 million, or $0.06 per basic and diluted share, compared to a net loss of $2.7 million, or $0.22 per basic and diluted share, for the fourth quarter of 2010. Net income for the fourth quarter of 2011 included approximately $0.2 million of relocation related costs. Net income for the fourth quarter of 2011 also included a $0.3 million loss from discontinued operations related to eCOST.com, compared to a $3.2 million loss from discontinued operations related to eCOST.com for the same period last year;
  • Non-GAAP net income (as defined) was $1.4 million, or $0.11 per basic and diluted share, compared to Non-GAAP net income of $0.7 million, or $0.05 per basic and diluted share, for the quarter ended December 31, 2010;
  • Total cash, cash equivalents and restricted cash was $18.5 million as of December 31, 2011, compared to $20.3 million as of December 31, 2010.

Summary of consolidated results for the year ended December 31, 2011:

  • Total revenue increased 9% to $298.8 million, compared to $274.5 million for the year ended December 31, 2010;
  • Service Fee revenue increased 35% to $95.3 million, compared to $70.6 million for the year ended December 31, 2010;
  • Service Fee equivalent revenue (as defined) increased 29% to $107.1 million, compared to $82.8 million for the year ended December 31, 2010;
  • Adjusted EBITDA (as defined) was $6.1 million, compared to $5.5 million for the year ended December 31, 2010;
  • Net loss was $4.6 million, or $0.36 per basic and diluted share, compared to net loss of $7.4 million or $0.65 per basic and diluted share, for the year ended December 31, 2010. Net loss for 2011 included approximately $0.5 million of relocation related costs. Net loss for the year 2011 also included a $0.9 million loss from discontinued operations related to eCOST.com, compared to a $4.0 million loss from discontinued operations related to eCOST.com in the same period last year;
  • Non-GAAP net loss (as defined) was $2.3 million, or $0.18 per basic and diluted share, compared to a Non-GAAP net loss of $1.9 million, or $0.17 per basic and diluted share, for the year ended December 31, 2010.

“Our new business pipeline remains strong and we currently anticipate continued service fee revenue growth in 2012. We are currently targeting 10 to 15 new client programs to be implemented or signed during the year, the growth from which will be partially offset by approximately 3 to 6 client programs that we currently expect will conclude or significantly reduce operations during 2012. Also, we expect further reductions in product revenue due to the impact of a reorganization by our largest client relationship in this segment. On an overall basis, we are currently targeting a year-over-year increase in service fee equivalent revenue (as defined) of approximately 20% in 2012. While we continue to make investments to support our growth, we are targeting an improved consolidated Adjusted EBITDA performance for 2012 to approximately $8 million to $10 million,” Mr. Layton concluded.

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