Delaware
|
001-34167
|
54-1817218
|
||
(State or other jurisdiction of incorporation or organization)
|
(Commission File Number)
|
(I.R.S. Employer Identification No.)
|
99.1
|
Press release dated November 2, 2017, issued by ePlus inc.
|
ePlus inc.
|
||||
By: /s/ Elaine D. Marion
|
||||
Elaine D. Marion
|
||||
Chief Financial Officer
|
·
|
Consolidated net sales declined 0.2% to $370.8 million.
|
·
|
Technology segment net sales declined 1.1% to $358.8 million; financing segment net sales increased 37.7% to $12.0 million.
|
·
|
Technology segment adjusted gross billings of product and services increased 3.3% to $503.6 million.
|
·
|
Consolidated gross profit increased 6.9% to $87.6 million; consolidated gross margin expanded 150 basis points to 23.6%.
|
·
|
Net earnings increased 2.7% to $17.2 million.
|
·
|
Adjusted EBITDA increased 3.4% to $31.0 million.
|
·
|
Diluted earnings per share increased 1.7% to $1.23. Non-GAAP diluted earnings per share increased 3.3% to $1.27.
|
·
|
Consolidated net sales increased 10.2% to $738.0 million
|
·
|
Technology segment net sales increased 9.6% to $716.9 million; financing segment net sales increased 33.8% to $21.1 million.
|
·
|
Technology segment adjusted gross billings of product and services increased 11.4% to $985.3 million.
|
·
|
Consolidated gross profit increased 10.4% to $165.2 million; consolidated gross margin expanded 10 basis points to 22.4%.
|
·
|
Net earnings increased 11.7% to $30.6 million.
|
·
|
Adjusted EBITDA increased 8.8% to $53.5 million.
|
·
|
Diluted earnings per share increased 12.3% to $2.19. Non-GAAP diluted earnings per share increased 8.5% to $2.17.
|
Three Months Ended September 30,
|
|||||||||
2017
|
2016
|
Change
|
|||||||
Sales of product and services
|
$357,759
|
|
$361,227
|
|
$(3,468)
|
|
(1.0%)
|
||
Fee and other income
|
1,043
|
|
1,488
|
|
(445)
|
|
(29.9%)
|
||
Net sales
|
358,802
|
|
362,715
|
|
(3,913)
|
|
(1.1%)
|
||
|
|
|
|
|
|
|
|||
Cost of sales, product and services
|
281,953
|
|
288,204
|
|
(6,251)
|
|
(2.2%)
|
||
Gross profit
|
76,849
|
|
74,511
|
|
2,338
|
|
3.1%
|
||
Selling, general and administrative
|
53,503
|
|
48,302
|
|
5,201
|
|
10.8%
|
||
Depreciation and amortization
|
2,128
|
1,721
|
407
|
23.6%
|
|||||
Operating expenses
|
55,631
|
|
50,023
|
|
5,608
|
|
11.2%
|
||
|
|
|
|
|
|
|
|||
Operating income
|
$21,218
|
|
$24,488
|
$(3,270)
|
(13.4%)
|
||||
Key Business Metrics
|
|||||||||
Adjusted gross billings, product
and services
|
$503,581
|
$487,308
|
$16,273
|
3.3%
|
|||||
Adjusted EBITDA
|
$23,346
|
$26,209
|
$(2,863)
|
(10.9%)
|
Three Months Ended September 30,
|
|||||||||
2017
|
2016
|
Change
|
|||||||
Financing revenue
|
$12,035
|
|
$8,722
|
|
$3,313
|
|
38.0%
|
||
Fee and other income
|
8
|
|
25
|
|
(17)
|
|
(68.0%)
|
||
Net sales
|
12,043
|
|
8,747
|
|
3,296
|
|
37.7%
|
||
Direct lease costs
|
1,321
|
|
1,325
|
|
(4)
|
|
(0.3%)
|
||
Gross profit
|
10,722
|
|
7,422
|
|
3,300
|
|
44.5%
|
||
Selling, general and administrative
|
2,837
|
|
3,305
|
|
(468)
|
|
(14.2%)
|
||
Depreciation and amortization
|
1
|
2
|
(1)
|
(50.0%)
|
|||||
Interest and financing costs
|
274
|
|
400
|
|
(126)
|
|
(31.5%)
|
||
Operating expenses
|
3,112
|
|
3,707
|
|
(595)
|
|
(16.1%)
|
||
Operating income
|
$7,610
|
|
$3,715
|
$3,895
|
104.8%
|
||||
Key Business Metrics
|
|||||||||
Adjusted EBITDA
|
$7,611
|
$3,717
|
$3,894
|
104.8%
|
Six Months Ended September 30,
|
||||||||
2017
|
2016
|
Change
|
||||||
Sales of product and services
|
$714,839
|
|
$651,408
|
|
$63,431
|
|
9.7%
|
|
Fee and other income
|
2,029
|
|
2,764
|
|
(735)
|
|
(26.6%)
|
|
Net sales
|
716,868
|
|
654,172
|
|
62,696
|
|
9.6%
|
|
|
|
|
|
|
|
|
||
Cost of sales, product and services
|
570,386
|
|
518,051
|
|
52,335
|
|
10.1%
|
|
Gross profit
|
146,482
|
|
136,121
|
|
10,361
|
|
7.6%
|
|
Selling, general and administrative
|
105,004
|
|
93,515
|
|
11,489
|
|
12.3%
|
|
Depreciation and amortization
|
4,190
|
3,492
|
698
|
20.0%
|
||||
Operating expenses
|
109,194
|
97,007
|
|
12,187
|
|
12.6%
|
||
|
|
|
|
|
|
|
||
Operating income
|
$37,288
|
|
$39,114
|
$(1,826)
|
(4.7%)
|
|||
Key Business Metrics
|
||||||||
Adjusted gross billings, product
and services
|
$985,266
|
$884,781
|
$100,485
|
11.4%
|
||||
Adjusted EBITDA
|
$41,478
|
$42,606
|
$(1,128)
|
(2.6%)
|
Twelve Months Ended September 30,
|
|||||
2017
|
2016
|
Change
|
|||
Technology
|
24%
|
23%
|
1%
|
||
State & Local Government & Educational Institutions
|
18%
|
22%
|
(4%)
|
||
Telecom, Media, and Entertainment
|
15%
|
15%
|
-
|
||
Financial Services
|
14%
|
12%
|
2%
|
||
Healthcare
|
12%
|
10%
|
2%
|
||
Other
|
17%
|
18%
|
(1%)
|
||
Total
|
100%
|
100%
|
Six Months Ended September 30,
|
||||||||
2017
|
2016
|
Change
|
||||||
Financing revenue
|
$21,106
|
|
$15,709
|
|
$5,397
|
|
34.4%
|
|
Fee and other income
|
28
|
|
84
|
|
(56)
|
|
(66.7%)
|
|
Net sales
|
21,134
|
|
15,793
|
|
5,341
|
|
33.8%
|
|
|
|
|
|
|
|
|
||
Direct lease costs
|
2,452
|
|
2,317
|
|
135
|
|
5.8%
|
|
Gross profit
|
18,682
|
|
13,476
|
|
5,206
|
|
38.6%
|
|
Selling, general and administrative
|
6,000
|
|
6,146
|
|
(146)
|
|
(2.4%)
|
|
Depreciation and amortization
|
2
|
6
|
(4)
|
(66.7%)
|
||||
Interest and financing costs
|
633
|
|
749
|
|
(116)
|
|
(15.5%)
|
|
Operating expenses
|
6,635
|
|
6,901
|
|
(266)
|
|
(3.9%)
|
|
Operating income
|
$12,047
|
|
$6,575
|
$5,472
|
83.2%
|
|||
Key Business Metrics
|
||||||||
Adjusted EBITDA
|
$12,049
|
$6,581
|
$5,468
|
83.1%
|
·
|
On October 24, ePlus announced it will lead a Chief Information Security Officer round table panel at the Triangle InfoSeCon conference in Raleigh, North Carolina on October 27.
|
·
|
On October 12, ePlus announced participation in a technology panel presentation at the Rochester Security Summit 2017 on October 19-20.
|
·
|
On September 18, ePlus announced the acquisition of IDS, a Midwest data center technology integrator and cloud services provider.
|
·
|
On August 30, ePlus announced management would present at the Telecom, Media and Technology Conference held in New York on September 6.
|
·
|
On August 30, ePlus announced it was named NetApp FlexPod Partner of the Year at the Inaugural Channel Connect conference in recognition of its overall FlexPod bookings and year-over-year FlexPod bookings growth.
|
·
|
On August 18, ePlus announced its board of directors authorized the Company to repurchase up to 500,000 shares of common stock over the 12-month period commencing August 19, 2017.
|
·
|
On August 15, ePlus announced the launch of a new website (www.igxglobal.com) for its London-based IGX Global subsidiary.
|
Date:
|
Thursday, November 2, 2017
|
Time:
|
4:30 p.m. ET
|
Live Call:
|
(877) 870-9226, domestic, (973) 890-8320, international
|
Replay:
|
(855) 859-2056, domestic, (404) 537-3406, international
|
Passcode:
|
95927274 (live and replay)
|
Webcast:
|
http://www.eplus.com/investors (live and replay)
|
ePlus inc. AND SUBSIDIARIES
|
|
|||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
|
|
|||||
|
|
|
|
|||
|
As of
|
As of
|
||||
|
September 30, 2017
|
March 31, 2017
|
||||
ASSETS
|
|
(in thousands, except per share data)
|
||||
Current assets:
|
|
|
||||
Cash and cash equivalents
|
$60,185
|
$109,760
|
||||
Accounts receivable—trade, net
|
293,098
|
266,029
|
||||
Accounts receivable—other, net
|
|
29,900
|
24,987
|
|||
Inventories
|
51,431
|
93,557
|
||||
Financing receivables—net, current
|
|
69,932
|
51,656
|
|||
Deferred costs
|
|
18,868
|
7,971
|
|||
Other current assets
|
|
31,931
|
43,364
|
|||
Total current assets
|
|
555,345
|
597,324
|
|||
|
|
|
|
|||
Financing receivables and operating leases—net
|
61,847
|
71,883
|
||||
Property, equipment and other assets
|
16,278
|
11,956
|
||||
Goodwill
|
76,470
|
48,397
|
||||
Other intangible assets—net
|
|
29,056
|
12,160
|
|||
TOTAL ASSETS
|
$738,996
|
$741,720
|
||||
|
|
|
|
|||
LIABILITIES AND STOCKHOLDERS' EQUITY
|
||||||
LIABILITIES
|
||||||
Current liabilities:
|
|
|
|
|||
Accounts payable
|
|
$99,965
|
$113,518
|
|||
Accounts payable—floor plan
|
120,217
|
132,612
|
||||
Salaries and commissions payable
|
17,484
|
18,878
|
||||
Deferred revenue
|
|
45,562
|
65,312
|
|||
Recourse notes payable—current
|
688
|
908
|
||||
Non-recourse notes payable—current
|
|
31,767
|
26,085
|
|||
Other current liabilities
|
20,438
|
19,179
|
||||
Total current liabilities
|
|
336,121
|
376,492
|
|||
|
|
|
|
|||
Non-recourse notes payable—long term
|
4,666
|
10,431
|
||||
Deferred tax liability—net
|
1,791
|
1,799
|
||||
Other liabilities
|
|
20,356
|
7,080
|
|||
TOTAL LIABILITIES
|
362,934
|
395,802
|
||||
|
|
|||||
COMMITMENTS AND CONTINGENCIES
|
|
|
|
|
||
|
|
|||||
STOCKHOLDERS' EQUITY
|
|
|
||||
Preferred stock, $.01 per share par value; 2,000 shares authorized; none outstanding
|
-
|
|
-
|
|||
Common stock, $.01 per share par value; 25,000 shares authorized; 14,171 outstanding at September 30, 2017 and 14,161 outstanding at March 31, 2017
|
142
|
142
|
||||
Additional paid-in capital
|
126,716
|
123,536
|
||||
Treasury stock, at cost
|
(4,383)
|
-
|
||||
Retained earnings
|
253,467
|
222,823
|
||||
Accumulated other comprehensive income—foreign currency translation adjustment
|
|
120
|
(583)
|
|||
Total Stockholders' Equity
|
376,062
|
345,918
|
||||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
$738,996
|
$741,720
|
ePlus inc. AND SUBSIDIARIES
|
|
|
|
|
|
|
|
||||||||||||||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
|
|||||||||||||||||||||||||
Three Months Ended
|
Six Months Ended
|
||||||||||||||||||||||||
September 30,
|
September 30,
|
||||||||||||||||||||||||
2017
|
2016
|
2017
|
2016
|
||||||||||||||||||||||
(in thousands, except per share data)
|
|||||||||||||||||||||||||
Net sales
|
$370,845
|
$371,462
|
|
$738,002
|
$669,965
|
||||||||||||||||||||
Cost of sales
|
283,274
|
|
289,529
|
|
572,838
|
520,368
|
|||||||||||||||||||
Gross profit
|
87,571
|
81,933
|
165,164
|
149,597
|
|||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||
Selling, general and administrative expenses
|
56,340
|
|
51,607
|
|
111,004
|
99,661
|
|||||||||||||||||||
Depreciation and amortization
|
2,129
|
1,723
|
4,192
|
3,498
|
|||||||||||||||||||||
Interest and financing costs
|
274
|
|
400
|
|
633
|
749
|
|||||||||||||||||||
Operating expenses
|
58,743
|
|
53,730
|
|
115,829
|
103,908
|
|||||||||||||||||||
|
|
|
|||||||||||||||||||||||
OPERATING INCOME
|
28,828
|
|
28,203
|
|
49,335
|
45,689
|
|||||||||||||||||||
|
|
|
|
||||||||||||||||||||||
Other income (expense)
|
(141)
|
|
380
|
|
130
|
380
|
|||||||||||||||||||
|
|
|
|
||||||||||||||||||||||
EARNINGS BEFORE PROVISION FOR INCOME TAXES
|
28,687
|
|
28,583
|
|
49,465
|
|
46,069
|
||||||||||||||||||
|
|
|
|
||||||||||||||||||||||
PROVISION FOR INCOME TAXES
|
11,466
|
|
11,808
|
|
18,821
|
18,623
|
|||||||||||||||||||
|
|
|
|
||||||||||||||||||||||
NET EARNINGS
|
$17,221
|
|
$16,775
|
|
$30,644
|
$27,446
|
|||||||||||||||||||
|
|
|
|
||||||||||||||||||||||
NET EARNINGS PER COMMON SHARE—BASIC
|
$1.24
|
|
$1.21
|
|
$2.21
|
$1.97
|
|||||||||||||||||||
NET EARNINGS PER COMMON SHARE—DILUTED
|
$1.23
|
|
$1.21
|
|
$2.19
|
$1.95
|
|||||||||||||||||||
|
|
|
|
||||||||||||||||||||||
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING—
|
|||||||||||||||||||||||||
BASIC
|
13,879
|
|
13,818
|
|
13,843
|
13,941
|
|||||||||||||||||||
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING—
|
|||||||||||||||||||||||||
DILUTED
|
14,008
|
|
13,884
|
|
14,021
|
14,055
|
ePlus inc. AND SUBSIDIARIES
|
|
|
|
|
|
|
|
RECONCILIATION OF NON-GAAP INFORMATION
|
|
|
|
|
|
|
|
Three Months Ended September 30,
|
Six Months Ended September 30,
|
||||||
|
2017
|
2016
|
2017
|
2016
|
|||
(in thousands)
|
|||||||
Sales of product and services
|
$357,759
|
|
$361,227
|
|
$714,839
|
|
$651,408
|
Costs incurred related to sales of third party software assurance, maintenance and services
|
145,822
|
126,081
|
|
270,427
|
|
233,373
|
|
Adjusted gross billings of product and services
|
$503,581
|
$487,308
|
|
$985,266
|
|
$884,781
|
Three Months Ended September 30,
|
Six Months Ended September 30,
|
||||||||||||||
|
2017
|
2016
|
2017
|
2016
|
|||||||||||
(in thousands)
|
|||||||||||||||
Consolidated
|
|||||||||||||||
Net earnings
|
$17,221
|
$16,775
|
|
$30,644
|
|
$27,446
|
|||||||||
Provision for income taxes
|
11,466
|
11,808
|
|
18,821
|
|
18,623
|
|||||||||
Depreciation and amortization [1]
|
2,129
|
1,723
|
|
4,192
|
|
3,498
|
|||||||||
Other income [2]
|
141
|
(380)
|
|
(130)
|
|
(380)
|
|||||||||
Adjusted EBITDA
|
$30,957
|
$29,926
|
|
$53,527
|
|
$49,187
|
|||||||||
Three Months Ended September 30,
|
Six Months Ended September 30,
|
||||||||||||||
|
2017
|
2016
|
2017
|
2016
|
|||||||||||
(in thousands)
|
|||||||||||||||
Technology Segment
|
|||||||||||||||
Operating income
|
$21,218
|
$24,488
|
|
$37,288
|
|
$39,114
|
|||||||||
Depreciation and amortization [1]
|
2,128
|
1,721
|
|
4,190
|
|
3,492
|
|||||||||
Adjusted EBITDA
|
$23,346
|
$26,209
|
|
$41,478
|
|
$42,606
|
|||||||||
Financing Segment
|
|||||||||||||||
Operating income
|
$7,610
|
$3,715
|
|
$12,047
|
|
$6,575
|
|||||||||
Depreciation and amortization [1]
|
1
|
2
|
|
2
|
|
6
|
|||||||||
Adjusted EBITDA
|
$7,611
|
$3,717
|
|
$12,049
|
|
$6,581
|
|||||||||
Three Months Ended September 30,
|
Six Months Ended September 30,
|
||||||||||||||
2017
|
2016
|
2017
|
2016
|
||||||||||||
(in thousands, except per share data)
|
|||||||||||||||
GAAP: Earnings before provision for income taxes
|
$28,687
|
|
$28,583
|
|
$49,465
|
|
$46,069
|
||||||||
Acquisition related amortization expense [3]
|
1,186
|
974
|
2,307
|
2,063
|
|||||||||||
Other (income) expense [2]
|
141
|
(380)
|
(130)
|
(380)
|
|||||||||||
Non-GAAP: Earnings before provision for income taxes
|
30,014
|
29,177
|
51,642
|
47,752
|
|||||||||||
GAAP: Provision for income taxes
|
11,466
|
11,808
|
18,821
|
18,623
|
|||||||||||
Acquisition related amortization expense
|
450
|
324
|
874
|
689
|
|||||||||||
Other (income) expense
|
59
|
(157)
|
(55)
|
(157)
|
|||||||||||
Tax benefit on restricted stock
|
204
|
72
|
1,563
|
508
|
|||||||||||
Non-GAAP: Provision for income taxes
|
12,179
|
12,047
|
21,203
|
19,663
|
|||||||||||
Non-GAAP: Net earnings
|
$17,835
|
$17,130
|
$30,439
|
$28,089
|
|||||||||||
GAAP: Net earnings per common share – diluted
|
$1.23
|
|
$1.21
|
|
$2.19
|
$1.95
|
|||||||||
Non-GAAP: Net earnings per common share – diluted
|
$1.27
|
$1.23
|
$2.17
|
$2.00
|
[1] Amount consists of depreciation and amortization for assets used internally.
|
[2] Interest income and foreign currency transaction gains or losses.
|
[3] Amount consists of amortization of intangible assets from acquired businesses.
|