InnerWorkings Inc. (INWK) reported operating loss of 2 cents per share in the fourth quarter of 2013, wider than the Zacks Consensus Estimate loss as well as the year-ago loss of 1 penny. The quarter disappointed as the third consecutive one ringing in a negative earnings surprise.
Behind the Headlines
InnerWorkings’s revenue for the reported quarter grossed $245.6 million, up 22% year over year and surpassed the Zacks Consensus Estimate by about 10%. Organic revenues improved 14% year over year.
Adjusted earnings before interest, tax, depreciation and amortization (EBITDA) edged down 1.6% year over year to $6.2 million.
Though revenues were at a record high, mounting total other expense induced losses in the quarter. Total other expense in the quarter amounted to $1.1 million, considerably up from $0.2 million incurred in the year-ago quarter.
Full-Year Highlights
InnerWorkings delivered operating earnings of 7 cents per share in 2013, on revenues of $893.4 million. While the bottom line plunged nearly 71%, an impressive top line improved 13% year over year.
77% of revenues were generated from enterprise sales, with the remaining 23% generated from middle-market sales.
Escalating expenses more than offset the revenue improvement resulting in lower earnings.
Financial Update
InnerWorkings exited 2013 with cash and cash equivalents of $18.8 million, up from $17.2 million in 2012.
While revolving credit facility as on Dec 31, 2013 was $69 million (compared with $65 million as on Dec 31, 2012), other long-term liabilities totaled $86.1 million (compared with $53.1 million as on Dec 31, 2012).
Operating cash flow totaled $39 million, surging 88% year over year.
Guidance for 2014
InnerWorkings expects to generate revenues in the range of $0.965 to $1 billion, which translates into a year-over-year increase of 8 to 12%. Adjusted earnings are expected to range between 23 and 27 cents per share, marking a substantial improvement over the year-ago level.
Zacks Rank
InnerWorkings carries a Zacks Rank #4 (Sell).
Performance of Other Business Service Providers
Cardtronics Inc. (CATM) reported fourth-quarter 2013 operating earnings of 44 cents per share, beating the Zacks Consensus Estimate by a penny and improving 19% year over year.
SouFun Holdings Ltd. (SFUN) reported operating earnings of $1.41 per share exceeding the Zacks Consensus Estimate by 34.5%, and surged 86% year over year.
Avis Budget Group Inc. (CAR) posted earnings of 15 cents in the fourth quarter, exceeding the Zacks Consensus Estimate by 25% and rebounding from the year-ago loss of 7 cents.
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