Perficient Inc. (PRFT)
Q1 2010 Earnings Call
May 6, 2010 9:00 am ET
Jeff Davis - President & Chief Executive Officer
Paul Martin - Chief Financial Officer
Jon Maietta - Needham & Co
George Price - Stifel Nicolaus
Previous Statements by PRFT
» Perficient, Inc. Q4 2009 Earnings Call Transcript
» Perficient, Inc. Q3 2009 Earnings Call Transcript
» Perficient Inc. Q2 2009 Earnings Call Transcript
Good day ladies and gentlemen, and welcome to the first quarter 2010 Perficient earnings conference call. My name is Jasmine, and I will be your operator for today. At this time all participants are in a listen-only mode. Later we will conduct a question-and-answer session. (Operator Instructions)
I would now like to turn the conference over to your host for today, to Mr. Jeff Davis, CEO and President. Mr. Davis you may begin.
Thank you. This is Jeff Davis. With me on the call today is Paul Martin, our CFO. I would like to thank all of you for your time this morning. As typical, we’ll have about 10 or 15 minutes of prepared comments, after which we will open the call up for questions.
Before we begin Paul will you please read the Safe Harbor statements.
Sure. Thanks Jeff, and good morning everyone. Some of the things we will discuss in today’s call concerning future company performance will be forward-looking statements within the meaning of the security laws.
Actual results may materially differ from those discussed in these forward-looking statements, and we encourage you to refer to the additional information contained in our SEC filings concerning factors that could cause those results to be different than contemplated in today’s discussion.
In addition, our earnings press release, including the reconciliation of certain non-GAAP financial measures to the most directly comparable financial measures prepared in accordance we Generally Accepted Accounting Principle or GAAP is posted on our website at
under news and events.
We have also posted a reconciliation of certain non-GAAP goals to the most directly comparable financial measures, prepared in accordance with GAAP on our website at
under Investor Relations.
I will now turn the call back over to Jeff. Jeff.
Thanks Paul, and thanks again everyone for joining. We are glad to be with you today. Well, 2010 is off to an excellent start for Preficient. We realized our second consecutive quarter of sequential revenue growth, Q4 of 2009, and the first quarter of this year.
Revenues came in above consensus and cash earnings matched the consensus estimates. We actually met also the GAAP expectation when you account for the one-time charge associated with our acquisition of Kerdock Consulting, an acquisition we are obviously very excited about, and I’ll discuss more a little bit later on the call.
While our performance was very strong in Q1, it’s the sales performance that we are most excited about. We mentioned this in the press release, but the first quarter of 2010 was Preficient’s strongest sales quarter ever in the history of the company. So we are seeing a very nice rebound on the demand side of the business.
We have talked for a couple of quarters about the business bottoming and getting back to growth in 2010, so we are expecting some incremental improvements as the year unfolded, and as we go forward we are expecting the same thing. But the current strength of the recovery is actually facing a little above our expectations to be honest. We are excited about that, and looking for some sustainability there, which we are seeing so far.
The remainder of the deals we signed in Q1 were very large, larger long term deals which enables us to adequately build staff as we support those projects as we ramp them up. It also creates a nice basic backlog as we move through 2010, and gives us a platform for additional growth.
We sold 21 deals north of $500,000 in the first quarter of 2010, which is not only 50% more than we sold in our strongest quarter last year in 2009, which by the way was third quarter with 14 deals above half a million, but it’s also actually more than we sold in the third quarter and the fourth quarter of 2009 combined; those were 20 deals above half a million, so 21 deals in the first quarter of this year. So a very, very strong start again on the sales front, as well as on the delivery side.
Our balance sheet remains strong. The company has no debt and more than $30 million in cash and liquid investments, and that’s after continuing to execute against our repurchase program, and completing the acquisition of Kerdock Consulting during the quarter.
We talked about this every quarter, but our cash and credit facility combined with strong cash flow generation each quarter really provides us a lot of flexibility as we grow the business, and obviously provides us with the cash we need to do additional acquisitions, an important part of our growth plan.
I think it’s fair to say that as we emerge from the great recession, Preficient is stronger than it’s ever been, from both a balance sheet perspective as well as the market competition perspective, so we are again, very excited, very optimistic about where things stand today.
As you know we started our acquisition program this quarter, and our intent as I said before is to execute one to two more deals this year. I said I thought we tried to get two or three done, we’ve gotten one in, so we are looking to do one to two more this year. We are in active discussion with a number of firms, and advanced discussions with a handful.