WALNUT CREEK, CA -- (Marketwired) -- Feb 25, 2014 -- ARC Document Solutions, Inc. (NYSE: ARC), the nation's leading document solutions provider for the architecture, engineering, and construction (AEC) industry, today reported its financial results for the fourth quarter and full year ended December 31, 2013.
Business Highlights:
- Annual revenue grew year-over-year for first time in five years
- Annual adjusted earnings per share was $0.09 vs. ($0.04) in 2012
- Annual gross margin was 33.0% vs. 30.4% in 2012
- Annual adjusted EBITDA margin of 16.8% vs. 14.9% in 2012
- Full year cash flow from operations of $46.8 million vs. $37.6 million in 2012
- 2014 fully-diluted annual adjusted earnings per share outlook projected to be in the range $0.19 to $0.23; outlook for 2014 annual cash provided by operating activities projected to be in the range of $51-$56 million
Financial Highlights:
Three Months Ended Twelve Months Ended
December 31, December 31,
------------------- -------------------
(All dollar amounts in millions,
except EPS) 2013 2012 2013 2012
-------- -------- -------- --------
Net Revenue $ 101.3 $ 96.9 $ 407.2 $ 406.1
Gross Margin 33.0% 29.6% 33.0% 30.4%
Net loss attributable to ARC $ (16.0) $ (5.9) $ (15.3) $ (32.0)
Adjusted Net Income (loss)
attributable to ARC $ 1.1 $ (0.8) $ 4.1 $ (1.7)
Earnings (loss) per share $ (0.35) $ (0.13) $ (0.33) $ (0.70)
Adjusted earnings (loss) per share $ 0.02 $ (0.02) $ 0.09 $ (0.04)
Cash provided by operating
activities $ 6.8 $ 6.7 $ 46.8 $ 37.6
Capital Expenditures $ (3.3) $ (6.2) $ (18.2) $ (20.3)
Debt & Capital Leases (including
current) $ 219.7 $ 222.5
Management Commentary
"Our performance in 2013 was gratifying and exceeded our initial expectations, especially in our sales, cash generation, and margin performance," said K. "Suri" Suriyakumar, Chairman, President and CEO of ARC Document Solutions. "As we noted in January, the third and fourth quarters produced year-over-year sales increases, and for the first time in the company's public history, fourth quarter revenue matched third quarter revenue. Fourth quarter gross margin also improved sequentially over third quarter gross margin. These are all indications of the fundamental changes in the business drivers of our company. As a result of the effects of the restructuring we began in 2012, we also saw gross margin expand dramatically year-over-year, and we delivered a strong uptick in our adjusted EBITDA. We've achieved real momentum with organic margin improvement programs as well, and I expect that we will continue to reap the benefit of our efforts throughout the coming year."
John Toth, ARC's CFO, said, "While our business has adapted to embrace new customer workflows, new business lines, and new technologies, one thing that hasn't changed is our ability to produce cash. Not only did we exceed our forecast for cash flow from operations, but we ended the year with a cash balance equal to 2012 despite the cash outlays associated with our restructuring, open market bond repurchases, and our refinancing at the end of the year. We are well positioned to deleverage the company and I think our performance in 2013 provides an excellent springboard for more success in 2014."
2013 Fourth Quarter Supplemental Information:
Net sales were $101 million, a 5% increase compared to the fourth quarter of 2012.
Days sales outstanding in Q4 2013 were 50 compared to 48 days in Q4 2012.
AEC customers comprised approximately 76% of our total net sales, while non-AEC customers made up 24% of our total net sales.
Total number of Onsite Services contracts was approximately 7,700, a gain of approximately 700 contracts over Q4 2012.
