Accelerize Inc. Reports Third Quarter 2014 Financial Results
Third Quarter Revenues Increase 71.0% Year Over Year to Reach a Record $4.3MM, With Expected Full-Year Revenues Between $16.2MM and $16.4MM
NEWPORT BEACH, CA–(Marketwired – Nov 13, 2014) – Accelerize Inc. (OTCQB: ACLZ) (OTCBB:ACLZ), a leader in marketing technology solutions, today announced financial results for its fiscal third quarter ended September 30, 2014.
Company Highlights for Q3 2014
– Total number of customers using the CAKE SaaS-based platform increased to over 500 in the third quarter of 2014, up 50% year over year and over 10% sequentially from the prior quarter.
– Average revenue per customer in the third quarter increased by 11% year over year.
– SaaS revenue in the third quarter increased across all geographic segments.
– Continued global diversification with 23% of overall revenue derived outside the U.S. for the first nine months of 2014, up from 11% for the first nine months of 2013.
– Credit facility with Square 1 Bank increased to $6MM to fuel corporate growth.
– Launched CAKE for Advertisers, a multi-channel marketing hub that enables advertisers to accurately track, attribute and optimize digital spend across the entire digital customer journey.
“We are pleased to have achieved another quarter of record revenue growth at Accelerize and to have recorded further gains from our CAKE SaaS enterprise platform in several important growth metrics including overall customer base and average revenue per customer. We have also achieved significant global revenue diversification through our expansion into the European and Asian markets. As we move through the remainder of 2014 we expect to maintain our progressive growth trajectory and we expect full year revenues between $16.2 million and $16.4 million. We anticipate continuing our momentum into 2015 by making additional investments in sales and R&D to further capitalize on our leadership position in performance-based marketing innovation,” said Accelerize Inc. Chairman and CEO Brian Ross. “We see this quarter’s launch of CAKE for Advertisers as a significant inflection point in our history as we have now officially opened the door to a vast potential market and customer base. As we begin to penetrate this market we expect each customer win to represent a much larger overall recurring revenue opportunity, and we intend to work diligently to establish a significant presence in this space for years to come.”
Financial Highlights for Q3 2014
– Revenues: Total revenues for the third quarter reached a record $4.3MM, a 71.0% increase from $2.5MM recorded in Q3 2013, and an 11% sequential increase from Q2 2014. Revenue growth was fueled by a 50% increase in the number of clients on the CAKE platform and an 11% increase in the average usage fees earned per client when compared to Q3 2013. We expect future revenues from CAKE to be driven by ongoing organic growth, expansion in Europe and Asia, as well as through the launch of CAKE for Advertisers.
– Operating Income (Loss): Operating loss for the third quarter was $(1.25MM), compared to operating income of $93K recorded in Q3 2013. This was mainly attributable to our making significant investments in product development, the expansion of its sales, marketing, technology and corporate staff, and preparations for the launch of CAKE for Advertisers. Marketing costs associated with that launch are expected to have peaked in the third quarter. During the third quarter we invested $831K in ongoing research and development and total operating expenses increased 128.4% year over year to $5.57MM to support our growth.
– Cash Flow: Net cash used in continuing operations was $(2.1MM), compared to net cash provided by continuing operations of $640K during the prior year period. The increase in cash used in operations is largely attributable to R&D costs and marketing expenditures associated with the launch of CAKE for Advertisers, the expansion of our U.K. office, and the addition of 17 new employees in the quarter. Net cash at the end of the third quarter increased by $232K from the prior quarter to $1.4M.
– Our revenue model is based on a monthly license fee, a usage fee (based on volume of online events), and a training and implementation fee. Clients purchase annual subscriptions with an additional usage fee.
– A majority of our revenue is derived from U.S. customers, but we have seen a 60% and 600% growth from our European and other geographic segments, respectively, during Q3 2014 when compared to Q3 2013.
– We believe to have sufficient cash to fund operations for at least the next 12 months.
Accelerize Inc. (OTCQB: ACLZ) (OTCBB: ACLZ), offers marketing technology solutions that revolutionize the way advertisers leverage their digital advertising data. CAKE, a division of Accelerize, provides SaaS-based solutions that track, attribute and optimize the performance of digital marketing spend, in real-time. Bringing clarity to multi-channel marketing campaigns, CAKE empowers advertisers, agencies, publishers and networks with the insight to make intelligent marketing decisions. For more information on CAKE visit www.getCAKE.com. For more information about Accelerize, visit www.accelerize.com.
Use of Forward-looking Statements
This press release may contain forward-looking statements from Accelerize Inc. within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995 and federal securities laws. For example, when we describe our expectations for future revenues, our growth trajectory, our continuing momentum, using our credit facility to fuel growth, making additional investments in sales and R&D, the potential market and customer base for CAKE for Advertisers and the expectation for recurring revenue opportunities related thereto, and the expectation for full year revenues between $16.2 million and $16.4 million, we are using forward-looking statements. These forward-looking statements are based on the current expectations of the management of Accelerize only, and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. The following factors, among others, could cause actual results to differ materially from those described in the forward-looking statements: changes in technology and market requirements; our technology may not be validated as we progress further; we may be unable to retain or attract key employees whose knowledge is essential to the development of our products and services; unforeseen market and technological difficulties may develop with our products and services; inability to timely develop and introduce new technologies, products and applications; loss of market share and pressure on pricing resulting from competition, which could cause the actual results or performance of Accelerize to differ materially from those contemplated in such forward-looking statements. Except as otherwise required by law, Accelerize undertakes no obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. For a more detailed description of the risk and uncertainties affecting Accelerize, reference is made to Accelerize’s reports filed from time to time with the Securities and Exchange Commission