Sajan, Inc. announces financial results for first quarter 2016
12 Mai 2016 - 2:03PM
Sajan, Inc. (NASDAQ:SAJA), a leading provider of global language
services and translation management system technology, today
reported financial results for the first quarter ended March
31, 2016.
Revenues were $6,777,000, which represented a decrease of 9
percent compared to revenues of $7,481,000 for the quarter ended
March 31, 2015. The Company reported a net loss of $200,000 for the
quarter ended March 31, 2016 compared to net income of $4,000 for
the quarter ended March 31, 2015. Adjusted EBITDA was $27,000
for the quarter ended March 31, 2016 compared to $346,000 for the
quarter ended March 31, 2015. See the section entitled “Non-GAAP
Financial Measures” below for a reconciliation of Adjusted EBITDA
to net income (loss).
Shannon Zimmerman, CEO of Sajan, commented on the Company’s
first quarter results:
“Our first quarter is typically impacted by slower translation
spending by our customers. This year we saw this seasonality
manifest itself in the pattern displayed by last year’s first
quarter top 10 customers. Seven of these top 10 customers had an
aggregate 30 percent decrease in revenue, while three of them had
an aggregate 22 percent increase in revenue. This pattern was
repeated with many of our customers during the quarter, and
although we benefited from new business and current customers with
increased spending in the quarter, the overall impact was a 9
percent decline in total revenue. I would like to emphasize that
our relationships with our customers are strong and that we are
well positioned to see revenue growth during the rest of the
year.”
Mr. Zimmerman continued, “During the quarter we made numerous
sales and operational improvements including the
following:
- Adding a Strategic Alliance Manager who will be specifically
responsible for expanding our partner program and for accelerating
sales of SiteSync, our web translation solution.
- Hiring an experienced sales representative who has been selling
translation services in the Life Sciences industry for 10 years and
who will be devoted 100 percent to our customers in this growing
market.
- Reorganizing our operations staff and launching significant
improvements to our translation and project management technology
to help us manage growth in translation projects more efficiently.
These actions should have a positive impact on our margins during
the rest of 2016 and beyond.”
The Company also announced today that its Board of Directors has
approved the repurchase of up to $300,000 of the Company’s common
stock. “Our Board of Directors and senior management strongly
believe that Sajan’s growth prospects and long-term strategy are
not reflected by the Company’s current stock price,” said
Zimmerman. He continued, “The stock repurchase program underscores
the strength of our balance sheet and the confidence we have in our
business, and demonstrates our commitment to maximizing value for
our shareholders.”
Under the stock repurchase program, Sajan may repurchase shares
in open-market purchases in accordance with all applicable
securities laws and regulations, including Rule 10b-18 of the
Securities Exchange Act of 1934, as amended. The extent to which
Sajan repurchases its shares, and the timing of such repurchases,
will depend upon a variety of factors, including market conditions,
regulatory requirements and other corporate considerations, as
determined by Sajan’s management team. The repurchase program may
be suspended or discontinued at any time.
Non-GAAP Financial Measures – Adjusted
EBITDA
Adjusted EBITDA |
Three months ended March 31, |
(in thousands) |
|
2016 |
|
|
|
2015 |
|
Net (loss) income |
$ |
(200 |
) |
|
|
$ |
4 |
|
Interest expense |
|
7 |
|
|
|
|
19 |
|
Income taxes |
|
4 |
|
|
|
|
10 |
|
Depreciation and amortization |
|
142 |
|
|
|
|
230 |
|
Stock-based compensation |
|
74 |
|
|
|
|
83 |
|
Adjusted EBITDA |
$ |
27 |
|
|
|
$ |
346 |
|
|
|
|
|
|
|
|
|
|
The Company calculates Adjusted EBITDA by taking net income
(loss) calculated in accordance with GAAP, and adding interest
expense, income taxes, depreciation and amortization, and
stock-based compensation. The Company believes that this non-GAAP
measure of financial results provides useful information to
management and investors regarding certain financial and business
trends relating to the Company’s financial condition and results of
operations. Company management uses this non-GAAP measure to
compare company performance to that of prior periods for trend
analyses and for budgeting and planning purposes. This measure is
also used in financial reports prepared for management and the
board of directors. The Company believes that the use of this
non-GAAP financial measure provides an additional tool for
investors to use in evaluating ongoing operating results and trends
and in comparing the Company’s financial measures with other
companies, many of which present similar non-GAAP financial
measures to investors.
Company management does not consider this non-GAAP measure in
isolation or as an alternative to financial measures determined in
accordance with GAAP. The principal limitation of this non-GAAP
financial measure is that it excludes significant expenses and
income that are required by GAAP to be recorded in the Company’s
consolidated financial statements. In addition, it is subject to
inherent limitations as it reflects the exercise of judgments by
management about which expenses and income are excluded or included
in determining this non-GAAP financial measure. In order to
compensate for these limitations, management presents this non-GAAP
financial measure in connection with GAAP results. The Company
urges investors to review the reconciliation of non-GAAP financial
measures to the comparable GAAP financial measures and not to rely
on any single financial measure to evaluate the Company’s
business.
Conference Call Details
The Company's investors will have the opportunity to listen to
management's discussion of its business operations, financial
results and growth strategies on a conference call at 10:30 a.m.
(Central time) on May 12, 2016. The Company invites all those
interested to join the call by dialing (888) 469-1336 and entering
access code 7540313. For those who cannot listen to the live
broadcast, a replay will be available shortly after the call and
until 11:59 p.m. CT on May 19, 2016 by dialing (866) 498-5464.
About Sajan
Sajan is a leading provider of global language translation and
localization services, helping clients around the world expand
seamlessly into any global market. The foundation of Sajan’s
solution is its industry-leading language translation management
system technology, Sajan Transplicity, which provides process
automation and innovative multilingual content reuse to ensure
schedule predictability, higher quality and cost efficiencies for
its clients. By working closely with its clients, Sajan’s
experienced team of localization professionals develops tailored
solutions that lend flexibility to any large or small business that
truly desires to “think globally, but act locally.” Based in the
United States, Sajan also has offices in Ireland, Spain and
Singapore. Visit Sajan online at www.sajan.com.
Forward-Looking Statements
The Private Securities Litigation Reform Act of 1995 provides a
safe harbor for certain forward-looking statements. The Company’s
Annual Report on Form 10-K, its Quarterly Report on
Form 10-Q and other filings with the Securities and Exchange
Commission, the Company’s press releases and oral statements made
with the approval of an authorized executive officer, contain
forward-looking statements that reflect the Company’s current views
with respect to future events and financial performance. These
forward-looking statements are subject to certain risks and
uncertainties that could cause actual results to differ materially
from historical results or those anticipated. The words “aim,”
“believe,” “expect,” “anticipate,” “intend,” “estimate” and other
expressions that indicate future events and trends identify
forward-looking statements. Actual future results and trends may
differ materially from historical results or those anticipated
depending on a variety of factors, including, but not limited to
those set forth in the Company’s Annual Report on Form 10-K
for the year ended December 31, 2015 filed with the Securities
and Exchange Commission on March 16, 2016, under the heading
“Item 1A. Risk Factors.” The Company does not undertake any
obligation to publicly update or revise any forward-looking
statement, whether as a result of new information, future events or
otherwise.
Sajan, Inc. and Subsidiaries |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED) |
Amounts in thousands except per share
data |
|
|
Three months ended March 31, |
|
|
2016 |
|
|
|
2015 |
|
Revenues |
$ |
6,777 |
|
|
$ |
7,481 |
|
Operating Expenses: |
|
|
|
Cost of revenues (exclusive of depreciation and
amortization) |
|
4,290 |
|
|
|
4,411 |
|
Sales and marketing |
|
909 |
|
|
|
920 |
|
Research and development |
|
404 |
|
|
|
433 |
|
General and administrative |
|
1,217 |
|
|
|
1,448 |
|
Depreciation and amortization |
|
142 |
|
|
|
230 |
|
(Loss) income from
Operations |
|
(185 |
) |
|
|
39 |
|
Other expense, net |
|
11 |
|
|
|
25 |
|
(Loss) income before income taxes |
|
(196 |
) |
|
|
14 |
|
Income tax expense |
|
4 |
|
|
|
10 |
|
Net (loss) income |
$ |
(200 |
) |
|
$ |
4 |
|
(Loss) income per common share – basic &
diluted |
$ |
(0.04 |
) |
|
$ |
0.00 |
|
Weighted average shares outstanding – basic |
|
4,783 |
|
|
|
4,775 |
|
Weighted average shares outstanding –
diluted |
|
4,783 |
|
|
|
|
4,869 |
|
Sajan, Inc. and Subsidiaries |
|
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED) |
|
Amounts in thousands |
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31, 2016 |
|
December 31, 2015 |
|
Assets |
|
|
|
|
|
Current assets |
|
|
|
|
|
Cash and
cash equivalents |
|
$ |
3,411 |
|
|
$ |
3,727 |
|
|
Accounts
receivable, net of allowance |
|
|
3,720 |
|
|
|
5,032 |
|
|
Unbilled
services |
|
|
1,289 |
|
|
|
646 |
|
|
Other
current assets |
|
|
718 |
|
|
|
684 |
|
|
Total current
assets |
|
|
9,138 |
|
|
|
10,089 |
|
|
Property
and equipment, net |
|
|
991 |
|
|
|
642 |
|
|
Other assets, net |
|
|
160 |
|
|
|
181 |
|
|
Total Assets |
|
$ |
10,289 |
|
|
$ |
10,912 |
|
|
Liabilities and
Stockholders' Equity |
|
|
|
|
|
Current
liabilities |
|
|
|
|
|
Accounts
payables |
|
$ |
2,979 |
|
|
$ |
3,297 |
|
|
Other
current liabilities |
|
|
1,475 |
|
|
|
1,666 |
|
|
Total current
liabilities |
|
|
4,454 |
|
|
|
4,963 |
|
|
|
|
|
|
|
|
Stockholders'
equity |
|
|
5,835 |
|
|
|
5,949 |
|
|
Total Liabilities and Stockholders' Equity |
|
$ |
10,289 |
|
|
$ |
10,912 |
|
|
Contact:
Tom Skiba
Chief Financial Officer
email: tskiba@sajan.com
phone: 715-426-9505
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