Conference Call to be Held Today at 4:30 pm Eastern Time
Palo Alto, Calif. – Big data analytics and solutions provider Sysorex (NASDAQ: SYRX) today reported financial results for the Third Quarter ended September 30, 2015.
“Our accomplishments in the third quarter demonstrate our trend toward driving growth in our professional services, proprietary data analytics and Sysorex products, which should inherently drive higher gross margins,” said Nadir Ali, CEO. “Our recent follow-on contract with Daruna, valued at approximately $91 million over a 15 year period, is evidence that our acquisitions and subsequent integration efforts are progressing as anticipated. We remain highly encouraged by our performance across our integrated business segments and look forward to the planned 2016 rollout of our LightMiner Analytics solution, a unique high-speed database technology which will allow clients to manage and analyze massive amounts of data in near-real time, either on premise or in the cloud,” he added.
Third Quarter Financial Highlights:
- Q3 2015 Revenue of $14.9 Million
- Q3 2015 Gross Margin of 30%
- Q3 2015 GAAP net loss of $0.16 per share
- Proforma Non-GAAP net loss1 of $0.09 per share
- Q3 2015 Non-GAAP Adjusted EBITDA1 of ($1.5 Million)
Revenue: Total revenues for the three months ended September 30, 2015 were $14.9 million compared to $14.3 million for the comparable period in the prior year. The $600,000 increase in revenues, or approximately 4.2%, was primarily attributable to an increase in Professional Services revenue. Total third quarter 2015 revenue included $10.3 million of Storage and Computing revenue, $871,000 of SaaS revenue, $487,000 of Mobile, IoT and Big Data Products revenue and $3.2 million of Professional Services revenue.
Gross Profit: Total gross profit for the three months ended September 30, 2015 was $4.4 million compared to $4.3 million for the comparable period in the prior year. The gross profit margin for the three months ended September 30, 2015 was approximately 30% compared to approximately 30% for the three months ended September 30, 2014.
Net Loss: GAAP net loss attributable to common stockholders for the three months ended September 30, 2015 was $3.2 million compared to $2.5 million for the prior year period. This increase of $700,000 was primarily due to an adjustment to the Airpatrol intangibles resulting in a decrease of approximately $450,000 in amortization during the three months ended September 2014. In addition we incurred approximately $125,000 more in operating expenses, approximately $174,000 more in amortization of intangibles for the LightMiner acquisition offset by approximately $113,000 more in gross margin from Professional Services sales during the three months ended September 30, 2015.
Non-GAAP net loss1: Pro-forma non-GAAP net loss1 for the three months ended September 30, 2015 was $1.8 million compared to non-GAAP net loss of $1.7 million for the comparable period in the prior year. Proforma non-GAAP net loss or income per basic and diluted common share for the three months ended September 30, 2015 was a loss of ($0.09) per share compared to a loss of ($0.08) per share for the prior year period. Non-GAAP net loss or income per share is defined as net loss or income per basic and diluted share adjusted for non-cash items including stock based compensation, amortization of intangibles and one time charges including acquisition costs, severance costs, change in the fair value of shares to be issued and the costs associated with the public offering.
Non-GAAP adjusted EBITDA1: Total Non-GAAP adjusted EBITDA for the three months ended September 30, 2015 was a loss of $1.5 million compared to a loss of $1.5 million for the prior year period. Non-GAAP adjusted EBITDA is defined as net income or loss before interest, provision for income taxes, and depreciation and amortization – adjusted for other income or expense items, one time charges including acquisition costs, severance costs, change in the fair value of shares to be issued, costs associated with the public offering, and non-cash stock-based compensation.
1 A reconciliation of GAAP to non-GAAP financial measures is provided in the financial statement tables included in this press release. An explanation of these measures is also included under the heading “Non-GAAP Financial Measures.”
Third Quarter Business Highlights:
- Secured $91 Million, 15-year Follow-on Contract With Daruna
- Secured $1 Million Sysorex CyberSecurity Engagement With US Government Agency
- Secured New Systems Development Engagement With Gemini Observatory
- Named Kevin R. Harris Chief Financial Officer
- Secured $900,000 High Performance Computers & Systems Contract on Development of NASA Orion Spacecraft
- Announced $5.25 Million Public Offering of Common Stock
- Sysorex CMO Presented Talk on the “Internet of Things” at CTIA Super Mobility Conference
All results summarized in this press release (including the financial statement tables) should be considered preliminary, are qualified in their entirety by the financial statement tables included in this press release and are subject to change. Please refer to Sysorex’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2015, which will be filed with the Securities and Exchange Commission on or about November 13, 2015.
Conference Call Information
Management will host a conference call on Wednesday, November 4, 2015, at 4:30 pm Eastern Time to review financial results and corporate highlights. Following management’s formal remarks, there will be a question and answer session.
To listen to the conference call, interested parties within the U.S. should call 1-866-652-5200. International callers should call +1-412-317-6060. All callers should ask for the Sysorex Global Holdings Corp. conference call. The conference call will also be available through a live webcast at Sysorex.com.
A replay of the call will be available approximately one hour after the end of the call through December 7, 2015. The replay can be accessed via Sysorex’s website or by dialing 1-877-344-7529 (U.S.) or +1-412-317-0088 (international). The replay conference playback code is 10075498.
All statements in this release that are not based on historical fact are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and the provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. While management has based any forward-looking statements included in this release on its current expectations, the information on which such expectations were based may change. These forward-looking statements rely on a number of assumptions concerning future events and are subject to a number of risks, uncertainties and other factors, many of which are outside of the control of the registrant and its subsidiaries, which could cause actual results to materially differ from such statements. Such risks, uncertainties, and other factors include, but are not limited to, the fluctuation of global economic conditions, the performance of management and employees, our ability to obtain financing, competition, general economic conditions and other factors that are detailed in our periodic and current reports available for review at www.sec.gov. Furthermore, we operate in a highly competitive and rapidly changing environment where new and unanticipated risks may arise. Accordingly, investors should not place any reliance on forward-looking statements as a prediction of actual results. We disclaim any intention to, and undertake no obligation to, update or revise forward-looking statements.
Non-GAAP Financial Measures
Management believes that certain financial measures not in accordance with generally accepted accounting principles (“GAAP”) are useful measures of operations. EBIDTA, Adjusted EBITDA and pro forma net loss per share are non-GAAP measures. Sysorex defines “EBITDA” as net income (loss) before interest, provision for (benefit from) income taxes, and depreciation and amortization. Management uses Adjusted EBITDA as the matrix in which it manages the business and Sysorex defines “Adjusted EBITDA” as EBITDA plus adjustments for other income or expense items, non-recurring items and non-cash stock-based compensation. Sysorex defines “pro forma net loss per share” as GAAP net loss per share adjusted for stock-based compensation, amortization of intangibles and one time non-recurring charges such as severance costs, change in the fair value of shares to be issued, acquisition and offering costs.
Management provides Adjusted EBITDA and pro forma net loss per share measures so that investors will have the same financial information that management uses, which may assist investors in assessing Sysorex’s performance on a period-over-period basis. Adjusted EBITDA or pro forma net loss per share is not a measure of financial performance under GAAP, and should not be considered an alternative to net income (loss) or any other measure of performance under GAAP, or to cash flows from operating, investing or financing activities as an indicator of cash flows or as a measure of liquidity. Adjusted EBITDA and pro forma net loss per share have limitations as analytical tools and should not be considered either in isolation or as a substitute for analysis of Sysorex’s results as reported under GAAP.
Sysorex develops the systems and solutions that power the data-driven enterprise. With an innovative approach to big data, analytics and the Internet of Things (IoT), we blend virtual data from software and networks with the huge volume of physical data generated by mobile devices and Internet-connected things to open new worlds of insight. Our unique solutions are helping organizations worldwide improve decision making, increase productivity, and fuel the discoveries of tomorrow. Headquartered in Palo Alto, California, we have regional offices in North America, South America, Europe and the Middle East. Visit Sysorex.com, follow us @SysorexGlobal and Link up on LinkedIn.
Sysorex Media Relations:
A. Sage Osterfeld, 760-707-0459
Sysorex Investor Relations:
Scott Arnold, 516-222-2560