LIONBRIDGE TECHNOLOGIES, INC. WALTHAM, Mass., Aug. 6, 2014 /PRNewswire/ -- Lionbridge Technologies, Inc. (Nasdaq: LIOX), today announced revenue and earnings for the second quarter ended June 30, 2014.
Financial highlights for the second quarter include:
-- Revenue of $130.5 million, an increase of $10.3 million or 9% compared
to the first quarter of 2014 and an increase of $7.1 million, or 6%
year-on-year, compared to the second quarter of 2013.
-- Revenue grew 9% year-on-year in the Company's Global Language and
Content (GLC) segment, led by ongoing marketing services growth within
several large existing clients as well as new engagements during the
quarter with clients outside of the Company's top ten accounts.
-- GAAP net income of $3.8 million, or $0.06 per share, based on 63.4
million weighted average fully diluted common shares outstanding. GAAP
net income increased $1.9 million, or $0.03 per share, sequentially
compared to Q1 2014 and increased $0.3 million, or $0.00 per share,
year-on-year compared to Q2 2013.
-- Non-GAAP adjusted earnings of $7.5 million or $0.12 per share. The
Company defines non-GAAP adjusted earnings as net income excluding
merger, restructuring and acquisition-related charges, asset impairment
costs, stock-based compensation, and amortization of acquisition-related
intangible assets. Please see the section of this release entitled
"Non-GAAP Financial Measures" and the attached table for details and
reconciliations of this measure to the comparable GAAP measure.
-- Cash flow from operations of $7.1 million for the three months ended
June 30, 2014.
-- During the quarter, the Company acquired 505,000 shares of its common
stock under its share repurchase program for an aggregate purchase price
of $2.9 million.
The Company secured several significant new customer engagements in the quarter, including a market-leading global consulting firm, a global aerospace and defense company, and the games division of a large eCommerce company.
Lionbridge was also recently named the world's number one language services company by independent market research firm Common Sense Advisory (CSA Research) based on size, revenue and service mix.
"Our solid second quarter results reflect ongoing revenue growth, particularly in our translation and marketing business. We are expanding our large accounts with ongoing growth in our marketing services offerings. Our new onDemand customer engagement model is scaling. And we continue to execute on our strategy to expand our business across new end markets," said Rory Cowan, CEO of Lionbridge. "Despite potential hesitation within our largest account and related short-term slowdowns in our testing segment, we expect solid revenue, earnings and cash flow in the second half of 2014 with acceleration in 2015."
Lionbridge provided an outlook for Q3 of 2014 with estimated revenue of $124-127 million.
Lionbridge management will conduct a conference call at 9:00 a.m. ET this morning to discuss financial performance for the quarter and other matters, including matters related to its future performance. To participate, callers within the United States can dial 888-324-3186 and international callers can dial 630-395-0193. The pass code for the call is "Lionbridge". The conference call will also be available live via this link.
Non-GAAP Financial Measures
In this release, the Company's adjusted earnings and adjusted earnings per share are not presented in accordance with generally accepted accounting principles (GAAP) and are not intended to be used in lieu of GAAP presentations of results of operations. These measures are presented because management believes they provide additional information to investors with respect to the performance of our fundamental business activities. "Adjusted earnings" and "Adjusted Earnings per Share (EPS)" are Non-GAAP financial measures and should not be viewed as alternatives to GAAP measures of performance. Management believes the most directly comparable GAAP financial measure for these measures are net income and diluted net income per share and has provided a reconciliation of GAAP net income to adjusted earnings and adjusted earnings per share at the end of this release.
About Lionbridge
Lionbridge enables more than 800 world-leading brands to increase international market share, speed adoption of products and effectively engage their customers in local markets worldwide. Using our innovative cloud technology platforms and our global crowd of more than 100,000 professional cloud workers, we provide translation, online marketing, global content management and application testing solutions that ensure global brand consistency, local relevancy and technical usability across all touch points of the customer lifecycle. Based in Waltham, Mass., Lionbridge maintains solution centers in 26 countries. To learn more, visit http://www.lionbridge.com.
Forward Looking Statements.
This press release contains forward-looking statements that involve risks and uncertainties, including anticipated customer demand for the Company's services, expected financial performance, expected revenue and profit growth, and the momentum, pace and strengthening of such growth in Q3 2014, H2 2014, FY 2014 and FY 2015. These forward-looking statements reflect management's current views and Lionbridge does not undertake to update any of these forward-looking statements to reflect a change in its views or events or circumstances that occur after the date hereof except as required by law. Lionbridge's actual experiences, actions, financial and operating results may differ materially from those discussed in the forward-looking statements. Factors that might cause such a difference include Lionbridge's ability to provide and maintain high quality services at a competitive price and related customer satisfaction with such service delivery; the loss of or reduction in demand from one or more major client or customer, which would materially affect Lionbridge's business; reorganization or restructuring initiatives of one or more major clients or customers, which may impact such customer's demand or requirements for Lionbridge's services; Lionbridge's ability to expand its relationships with existing clients, including by offering its expanded range of services to existing customers; Lionbridge's ability to broaden its client base; the Company's dependence on clients' product releases, production schedules and procurement strategies to generate revenues; the anticipated benefits of expansion of global language workflow technologies; the anticipated growth of its OnDemand, crowdsourcing and digital marketing service offerings; the impact of competing technologies and platforms on the Company's existing customer relationships and ability to secure new customers; the ability of Lionbridge to realize the expected benefits of its technology initiatives and acquisitions, and the timing of the realization of such benefits; errors, interruptions or delays in cloud-based technology; breaches of security measures; the termination of customer contracts or engagements prior to the end of their term; the size, timing and recognition of revenue from clients; the ability of Lionbridge to integrate acquisitions and expand its customer relationships and the timing and success of such activities; the impact of foreign currency fluctuations on revenue, margins, costs, operating results and profitability and the Company's ability to successfully manage this exposure through hedge instruments and other strategies; the portion of the Company's service engagements that are subject to the impact of foreign currency fluctuations; continued uncertainty and volatility in global economic conditions that could negatively affect demand for the Company's services and technologies; reduced demand for the Company's services that adversely impacts Lionbridge's future revenues, cash flows, results of operations and financial condition; Lionbridge's ability to perform services in lower cost operational locations and the timing of its transfer of service execution to such locations, and customer acceptance of service execution in such locations; risks associated with conducting business outside of the United States, including compliance with changing and potentially conflicting laws and regulations and expenses and delays associated with any such activities; longer collection cycles in particular jurisdictions; risks associated with competition; Lionbridge's ability to forecast revenue, profitability, technology adoption, customer demand and operating results; changes in tax rates applicable to the Company and changes to the interpretations of applicable tax rates; changes in interpretation of statutory and regulatory positions by international tax authorities in countries in which Lionbridge conducts business; changes in interpretation of employment and tax positions by U.S. state and federal authorities; the failure of Lionbridge to keep pace with technological changes or changing customer needs; the risk of claims by third parties of intellectual property claims; the ability of Lionbridge to respond to fluctuations in the complexity, timing and mix of services required by customers; and Lionbridge being held liable for defects or errors resulting from its services or technologies; For a more detailed description of the risk factors associated with Lionbridge, please refer to the Company's Annual Report on Form 10-K for the year ended December 31, 2013 and subsequent filings with the SEC (copies of which may be accessed through the SEC's website at http://www.sec.gov.
LIONBRIDGE TECHNOLOGIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(Amounts in thousands, except per share data)
Three Months Ended Six Months Ended
June 30, June 30,
--------- ---------
2014 2013 2014 2013
---- ---- ---- ----
Revenue $130,538 $123,407 $250,743 $237,077
Operating expenses:
Cost of revenue (exclusive of
depreciation and amortization
included below) 89,871 84,253 172,951 166,135
Sales and marketing 9,764 9,123 19,684 18,272
General and administrative 20,373 19,188 40,719 38,669
Research and development 1,757 1,819 3,496 3,475
Depreciation and amortization 1,889 1,847 3,738 3,647
Amortization of acquisition-related
intangible assets 813 828 1,611 1,656
Restructuring, impairment, and other
charges 882 1,297 1,216 2,021
--- ----- ----- -----
Total operating expenses 125,349 118,355 243,415 233,875
------- ------- ------- -------
Income from operations 5,189 5,052 7,328 3,202
Interest expense:
Interest on outstanding debt 100 210 249 447
Amortization of deferred financing
costs 27 25 54 50
Interest income 31 13 50 39
Other expense (income), net 237 592 (111) 884
--- --- ---- ---
Income before income taxes 4,856 4,238 7,186 1,860
Provision for income taxes 1,066 771 1,514 1,363
----- --- ----- -----
Net income $3,790 $3,467 $5,672 $497
------ ------ ------ ----
Net income per share of common stock:
Basic $0.06 $0.06 $0.09 $0.01
Diluted $0.06 $0.06 $0.09 $0.01
Weighted average number of common shares outstanding:
Basic 60,523 60,724 60,372 60,550
Diluted 63,410 62,436 63,515 61,941
LIONBRIDGE TECHNOLOGIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(Amounts in thousands)
June 30, December 31,
2014 2013
---- ----
(unaudited)
ASSETS
Current assets:
Cash and cash equivalents $31,270 $38,867
Accounts receivable, net of allowances of $250 at June 30, 2014 and
December 31, 2013
78,131 70,431
Unbilled receivables 24,387 19,498
Other current assets 12,946 12,938
------ ------
Total current assets 146,734 141,734
Property and equipment, net 21,545 20,968
Goodwill 20,584 19,595
Acquisition-related intangible
assets, net 12,439 13,226
Other assets 4,618 5,487
Total assets $205,920 $201,010
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $26,404 $21,784
Accrued compensation and benefits 18,347 18,183
Accrued expenses and other current
liabilities 26,181 26,982
Deferred revenue 9,472 10,583
Total current liabilities 80,404 77,532
Long-term debt 27,000 27,000
Deferred income taxes, long-term 913 913
Other long-term liabilities 11,604 13,172
------ ------
Total stockholders' equity 85,999 82,393
------ ------
Total liabilities and stockholders'
equity $205,920 $201,010
======== ========
Reconciliation of GAAP Net Income to Non-GAAP Adjusted Earnings (Unaudited)
Comparison to Three and Six Months Ended June 30, 2013
Three Months Ended Six Months Ended
June 30, June 30,
2014 2013 2014 2013
---- ---- ---- ----
GAAP net income $3,790 $3,467 $5,672 $497
Amortization of acquisition-
related intangible assets 813 828 1,611 1,656
Stock-based compensation 1,992 1,660 3,806 3,310
Restructuring and
acquisition-related
charges 882 1,297 1,216 2,021
--- ----- ----- -----
Non-GAAP adjusted earnings $7,477 $7,252 $12,305 $7,484
====== ====== ======= ======
Fully diluted weighted
average number of common
shares outstanding 63,410 62,436 63,515 61,941
Non-GAAP adjusted EPS $0.12 $0.12 $0.19 $0.12
Sara Buda
Vice President, Investor Relations
Lionbridge Technologies, Inc.
781.434.6190
sara.buda@lionbridge.com
SOURCE Lionbridge Technologies, Inc.
