Thu, 14 Nov 2019

Crexendo Announces Third Quarter 2019 Results

ACCESSWIRE
06 Nov 2019, 08:05 GMT+10

PHOENIX, AZ / ACCESSWIRE / November 5, 2019 / Crexendo, Inc. (OTCQX:CXDO), an award-winning premier provider of cloud communications, UCaaS (Unified Communications as a Service), call center, collaboration services, and other cloud business services that are designed to provide enterprise-class cloud services to any size business at affordable monthly rates, today reported financial results for the third quarter of 2019.

Third Quarter Financial highlights:

Total revenue increased 19% year over year to $3.6 million.

UCaaS service revenue increased 24% year over year to $3.1 million.

GAAP net income was $334,000 or $0.02 per diluted share.

Non-GAAP net income was $454,000 or $0.03 per diluted share.

Financial Results for the Third Quarter 2019

Consolidated total revenue for the third quarter of 2019 increased 19% to $3.6 million compared to $3.0 million for the third quarter of 2018.

Consolidated service revenue for the third quarter of 2019 increased 20% to $3.3 million compared to $2.7 million for the Third quarter of 2018.

Cloud Telecommunications Segment UCaaS service revenue for the third quarter of 2019 increased 24% to $3.1 million compared to $2.5 million for the third quarter of 2018.

Web Services Segment service revenue for the third quarter of 2019 decreased 22% to $159,000, compared to $203,000 for the third quarter of 2018.

Consolidated product revenue for the third quarter of 2019 increased 9% to $343,000 compared to $314,000 for the third quarter of 2018.

Consolidated operating expenses for the third quarter of 2019 increased 1% to $3.3 million compared to $3.2 million for the third quarter of 2018.

The Company reported net income of $334,000 for the third quarter of 2019, or $0.02 per basic and diluted common share, compared to a net loss of $(199,000) or $(0.01) loss per basic and diluted common share for the third quarter of 2018.

Non-GAAP net income was $454,000 for the third quarter of 2019, or $0.03 per basic and diluted common share, compared to a non-GAAP net loss of $(12,000) or breakeven per basic and diluted common share for the third quarter of 2018.

EBITDA for the third quarter of 2019 was $361,000 compared to a $(167,000) loss for the third quarter of 2018. Adjusted EBITDA for the third quarter of 2019 was $468,000 compared to $2,000 for the third quarter of 2018.

Financial Results for the Nine Months Ended September 30, 2019

Consolidated total revenue for the nine months ended September 30, 2019 increased 22% to $10.7 million compared to $8.8 million for the nine months ended September 30, 2018.

Consolidated service revenue for the nine months ended September 30, 2019 increased 22% to $9.4 million compared to $7.7 million for the nine months ended September 30, 2018.

Cloud Telecommunications Segment UCaaS service revenue for the nine months ended September 30, 2019 increased 26% to $8.9 million compared to $7.1 million for the nine months ended September 30, 2018.

Web Services Segment service revenue for the nine months ended September 30, 2019 decreased 21% to $502,000, compared to $636,000 for the nine months ended September 30, 2018.

Consolidated product revenue for the nine months ended September 30, 2019 increased 16% to $1.3 million compared to $1.1 million for the nine months ended September 30, 2018.

Consolidated operating expenses for the nine months ended September 30, 2019 increased 9% to $9.8 million compared to $9.0 million for the nine months ended September 30, 2018.

The Company reported net income of $911,000 for the nine months ended September 30, 2019, or $0.06 per basic and diluted common share, compared to a net loss of $(215,000) or $(0.02) loss per basic and diluted common share for the nine months ended September 30, 2018.

Non-GAAP net income was $1.2 million for the nine months ended September 30, 2019, or $0.09 per basic common share and $0.08 per diluted common share, compared to $183,000 or $0.01 per basic and diluted common share for the nine months ended September 30, 2018.

EBITDA for the nine months ended September 30, 2019 was $986,000 compared to a $(140,000) loss for the nine months ended September 30, 2018. Adjusted EBITDA for the nine months ended September 30, 2019 was $1.3 million compared to $204,000 for the nine months ended September 30, 2018.

Total cash, cash equivalents, and restricted cash at September 30, 2019 was $3.4 million compared to $1.9 million at December 31, 2018.

Cash provided by operating activities for the nine months ended September 30, 2019 was $1.2 million compared to $350,000 for the nine months ended September 30, 2018. Cash used for investing activities for the nine months ended September 30, 2019 was $(72,000) compared to $(136,000) for the nine months ended September 30, 2018. Cash provided by financing activities for the nine months ended September 30, 2019 was $374,000 compared to $300,000 for the nine months ended September 30, 2018.

Steven G. Mihaylo, Chief Executive Officer commented, 'I am very excited that we have continued to be profitable on a GAAP basis. This marks our third quarter in a row of GAAP profitability. We have taken what is essentially a start-up and are turning it into a successful mature model. We have made tremendous improvements with the business and our results speak to that. I have full confidence we will continue to execute. I am particularly impressed with our Cloud Telecommunications Segment UCaaS service revenue which increased 24% compared to the third quarter of 2018. Something that I find highly impressive is the improvement in net income of $911,000 for the nine months ended September 30, 2019, or $0.06 per basic and diluted common share, compared to a net loss of $(0.02) loss per basic and diluted common share for the nine months ended September 30, 2018.. We also continue to make substantial gains in total cash, cash equivalents, and restricted cash which as of September 30, 2019 was $3.4 million compared to $1.9 million at December 31, 2018. These are very good results, and I believe that our results will continue to improve.

Mihaylo added, 'We continue to do an excellent job with our cash management. We also manage our expenses very carefully. Our team works tirelessly to continue to make the award winning Crexendo Ride the Cloud© technology and services second to none in the industry. I am highly impressed with our products our team and particularly our customer first attitude. We work every day to provide the best customer experience and to improve shareholder value. Our cash improved dramatically, our current ratio improved, our gross margins expanded and our shareholder equity almost doubled; all while our expenses increased at a much lower rate than our revenue grew. I expect these improvements to continue for the foreseeable future.'

Doug Gaylor, President and Chief Operating Officer, stated, 'We continue to execute on our plan, I am impressed with our results, our efforts and enthusiasm. I will continue to work diligently with Steve to improve our results and keep our momentum'

Conference Call

The Company is hosting a conference call today, November 5, 2019 at 5:30 PM EST. The dial-in number for domestic participants is 844-369-8770 and 862-298-0840 for international participants. Please dial in five to ten minutes prior to the beginning of the call at 5:30 PM EST and reference Crexendo. A replay of the call will be available until November 12, 2019 by dialing toll-free at 877-481-4010 or 919-882-2331 for international callers. The replay passcode is 53877.

About Crexendo

Crexendo, Inc. is an award-winning premier provider of cloud communications, UCaaS (Unified Communications as a Service), call center, collaboration services, and other cloud business services that are designed to provide enterprise-class cloud services to any size business at affordable monthly rates.

Safe Harbor Statement

This press release contains forward-looking statements. The Private Securities Litigation Reform Act of 1995 provides a 'safe harbor' for such forward-looking statements. The words 'believe,' 'expect,' 'anticipate,' 'estimate,' 'will' and other similar statements of expectation identify forward-looking statements. Specific forward-looking statements in this press release include information about Crexendo (i) being excited about continually being profitable on a GAAP basis; (ii) taking what is essentially a start-up and turning it into a successful mature model; (iii) making tremendous improvements with the business; (iv) having full confidence that company will continue to execute; (v) being particularly impressed with Cloud Telecommunications Segment UCaaS service revenue; (vi) improvements in total cash, cash equivalents, and restricted cash together with other metrics being very good results; (vii) believing that its results will continue to improve; (viii) doing an excellent job with cash management and managing expenses very carefully; (ix) team working tirelessly to make the award Crexendo technology and services second to none in the industry; (x) being highly impressed with its products, team and particularly its customer first attitude; (xi) working every day to provide the best customer experience and to improve shareholder value; (xii) believing that the improvements in cash, current ratio, gross margins and shareholder equity with expenses increasing at a much lower rate than revenue will all continue for the foreseeable future; (xiii) continuing to execute on its plan; (xiv) being impressed with its results, its efforts and enthusiasm and (xv) continuing to work diligently to improve results and keep its momentum.

For a more detailed discussion of risk factors that may affect Crexendo's operations and results, please refer to the company's Form 10-K for the year ended December 31, 2018, and quarterly Form 10-Qs as filed with the SEC. These forward-looking statements speak only as of the date on which such statements are made, and the company undertakes no obligation to update such forward-looking statements, except as required by law.

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