EX-99.1 2 ex99_1q119.htm EXHIBIT 99.1 Exhibit



________________________________________________________________________________________________________________________________
Exhibit 99.1


 
FOR RELEASE:
CONTACT:
New Hartford, NY, May 6, 2019
Christopher R. Byrnes (315) 738-0600  ext. 6226
cbyrnes@partech.com,  www.partech.com

PAR TECHNOLOGY CORPORATION ANNOUNCES 2019 FIRST QUARTER RESULTS


New Hartford, NY- May 6, 2019 -- PAR Technology Corporation (NYSE: PAR) today announced its results of operations for its first quarter ended March 31, 2019.

Summary of Fiscal 2019 First Quarter Financial Results

•
Revenues were reported at $44.7 million in the first quarter of 2019, compared to $55.7 million in the same period in 2018, a 19.7% decrease.
•
GAAP net loss in the first quarter of 2019 was $2.7 million, or $0.17 loss per diluted share, a decrease from the GAAP net income of $0.1 million, or $0.00 earnings per diluted share reported in the same period in 2018.
•
Non-GAAP net loss in the first quarter of 2019 was $1.8 million, or $0.11 loss per diluted share, compared to non-GAAP net income of $0.6 million, or $0.04 earnings per diluted share, in the same period in 2018.


A reconciliation and description of non-GAAP financial measures to their comparable GAAP financial measures are included in the tables at the end of this press release.

"In the first quarter we continued the ongoing transition of our business. I am pleased with our progress in the quarter. I am also particularly proud of our employees' continued efforts to focus on growing our business by serving our customers, delivering excellent products and adding new Brink bookings and recurring revenue streams on a consistent basis," said Savneet Singh, CEO & President PAR Technology Corporation. "We continue to invest in product development and focus our business development efforts on identifying new opportunities for our cloud solutions. Our strategy remains to rapidly accelerate our recurring revenue growth through providing a comprehensive portfolio of products and services to our restaurant customer base. We are also seeking out opportunities to increase monthly fees and subscription prices through strategic partnerships."

Highlights of the First Quarter 2019:

-- Brink ARR* at end of Q1 '19 now totals $15.8 million - an increase of $5.5 million from end of Q1 '18
-- Active Brink sites at end of Q1 '19 - now total 8,000 restaurants
-- Brink bookings in Q1 '19 719 restaurants
-- Brink bookings in Q1 '19 ASP** = $200 per month
*ARR - Run rate of annual recurring revenues - SaaS and support revenues
**ASP - Average selling price SaaS and support revenues





Mr. Singh added, "During the past three months, PAR has undergone a significant transition. Our Company has new leadership, we've released new versions of our products, reduced costs and improved our cash position. We are now poised to actually take advantage of the large and fast growing market in front of us. We have made the tough choices in the Company; those are now behind us, so we can focus our energies on building a great business. Our passionate focus on return on capital has led us to discovering new revenue streams and sharpened our awareness on customer satisfaction."
Conference Call.

There will be a conference call at 4:30 p.m. (Eastern) on May 6, 2019, during which the Company’s management will discuss the financial results for the first quarter ended March 31, 2019.  To participate in the call, please call 844-419-5412, approximately 10 minutes in advance.  No passcode is required to participate in the live call or to listen to the replay version.  Individual & Institutional Investors will have the opportunity to listen to the conference call/event over the internet by visiting the Company’s website at www.partech.com.  Alternatively, listeners may access an archived version of the presentation call after 7:30 p.m. on May 6, 2019 through May 13, 2019 by dialing 855-859-2056 and using conference ID 1338389.


About PAR Technology Corporation.

PAR Technology Corporation's stock is traded on the New York Stock Exchange under the symbol “PAR”. PAR’s Restaurant / Retail segment has been a leading provider of restaurant and retail technology for more than 35 years. PAR offers management technology solutions for the full spectrum of restaurant operations, from large chain and independent table service restaurants to international quick service chains. Products from PAR also can be found in retailers, cinemas, cruise lines, stadiums, and food service companies. PAR’s Government segment is a leader in providing computer-based system design, engineering and technical services to the Department of Defense and various federal agencies. For more information visit http://www.partech.com  or connect with us on  Facebook and Twitter .

Forward-Looking Statements.

This press release includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements appear throughout this press release, including express or implied forward-looking statements relating to our expectations regarding anticipated financial performance, customer and product opportunities, and assumptions as to future events. Forward-looking statements are subject to a variety of risks and uncertainties, many of which are beyond the Company’s control, that could cause actual results to differ materially from those contemplated in these statements. Factors that could cause actual results to differ materially, include: delays in new product development and/or product introduction; changes in customer base, or in product and service demands from our customers, particularly as to the two restaurant chain customers and the U.S. Department of Defense, each of which represent a significant portion of our revenue; risks associated with the internal investigation into conduct at our China and Singapore offices, including sanctions and fines that may be imposed by governmental authorities; and the other factors discussed in our most recent Annual Report on Form 10-K and other filings with the Securities and Exchange Commission (SEC). The Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as may be required under applicable securities law.



###









PAR TECHNOLOGY CORPORATION
CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share amounts)
(Unaudited)    
Assets
March 31, 2019
 
December 31, 2018
Current assets:
 
 
 
Cash and cash equivalents
$
4,142

 
$
3,485

Accounts receivable-net
29,311

 
26,219

Inventories-net
22,639

 
22,737

Other current assets
5,099

 
3,251

Total current assets
61,191

 
55,692

Property, plant and equipment – net
13,169

 
12,575

Goodwill
11,051

 
11,051

Intangible assets – net
11,176

 
10,859

Operating leases right-of-use assets
3,697

 
—

Other assets
4,764

 
4,504

Total Assets
$
105,048

 
$
94,681

Liabilities and Shareholders’ Equity
 

 
 

Current liabilities:
 

 
 

Borrowings of line of credit
$
16,139

 
$
7,819

Accounts payable
14,794

 
12,644

Accrued salaries and benefits
5,145

 
5,940

Accrued expenses
2,223

 
2,113

Customer deposits and deferred service revenue
11,540

 
9,851

Operating lease liabilities - current portion
1,540

 
—

Other current liabilities
—

 
2,550

Total current liabilities
51,381

 
40,917

Deferred revenue
4,807

 
4,407

Operating lease liabilities - net of current portion
2,177

 
—

Other long-term liabilities
3,198

 
3,411

Total liabilities
61,563

 
48,735

Commitments and contingencies
 
 
 
Shareholders’ Equity:
 

 
 

Preferred stock, $.02 par value, 1,000,000 shares authorized
—

 
—

Common stock, $.02 par value, 29,000,000 shares authorized; 17,956,318 and 17,879,761 shares issued, 16,248,209 and 16,171,652 outstanding at March 31, 2019 and December 31, 2018, respectively
357

 
357

Capital in excess of par value
50,529

 
50,251

Retained earnings
2,698

 
5,427

Accumulated other comprehensive loss
(4,263
)
 
(4,253
)
Treasury stock, at cost, 1,708,109 shares
(5,836
)
 
(5,836
)
Total shareholders’ equity
43,485

 
45,946

Total Liabilities and Shareholders’ Equity
$
105,048

 
$
94,681













PAR TECHNOLOGY CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(Unaudited)
 
Three Months Ended
March 31,
 
2019
 
2018
Net revenues:
 
 
 
Product
$
15,517

 
$
26,324

Service
14,043

 
13,196

Contract
15,122

 
16,141

 
44,682

 
55,661

Costs of sales:
 

 
 

Product
11,241

 
19,440

Service
10,027

 
9,547

Contract
13,650

 
14,827

 
34,918

 
43,814

Gross margin
9,764

 
11,847

Operating expenses:
 

 
 

 Selling, general and administrative
8,564

 
8,600

 Research and development
3,060

 
2,868

 Amortization of identifiable intangible assets
241

 
241

 
11,865

 
11,709

Operating (loss) income
(2,101
)
 
138

Other (expense) income, net
(430
)
 
49

Interest expense, net
(146
)
 
(41
)
(Loss) income before provision for income taxes
(2,677
)
 
146

Provision for income taxes
(52
)
 
(78
)
Net (loss) income
$
(2,729
)
 
$
68

Basic Earnings per Share:
 

 
 

Net (loss) income
$
(0.17
)
 
$
—

Diluted Earnings per Share:
 

 
 

Net (loss) income
$
(0.17
)
 
$
—

Weighted average shares outstanding
 

 
 

Basic
16,044

 
15,948

Diluted
16,044

 
16,286















PAR TECHNOLOGY CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL RESULTS
(in thousands, except per share and per share data)
(Unaudited)
 
 
For the three months ended March 31, 2019
For the three months ended March 31, 2018
 
 
Reported basis (GAAP)
 
Adjustments
 
Comparable basis (Non-GAAP)
 
Reported basis (GAAP)
 
Adjustments
 
Comparable basis (Non-GAAP)
Net revenues
 
$
44,682

 
$
—

 
$
44,682

 
$
55,661

 
$
—

 
$
55,661

Costs of sales
 
34,918

 
143

 
34,775

 
43,814

 
—

 
43,814

Gross margin
 
9,764

 
143

 
9,907

 
11,847

 
—

 
11,847

Operating Expenses:
 
 
 
 
 
 
 
 
 
 
 
 
Selling, general and administrative
 
8,564

 
755

 
7,809

 
8,600

 
478

 
8,122

Research and development
 
3,060

 
108

 
2,952

 
2,868

 
—

 
2,868

Acquisition amortization
 
241

 
241

 
—

 
241

 
241

 
—

Total operating expenses
 
11,865

 
1,104

 
10,761

 
11,709

 
719

 
10,990

Operating (loss) income
 
(2,101
)
 
1,247

 
(854
)
 
138

 
719

 
857

Other (expense) income, net
 
(430
)
 
—

 
(430
)
 
49

 
—

 
49

Interest expense, net
 
(146
)
 
—

 
(146
)
 
(41
)
 
—

 
(41
)
(Loss) income before provision for income taxes
 
(2,677
)
 
1,247

 
(1,430
)
 
146

 
719

 
865

Provision for income taxes
 
(52
)
 
(299
)
 
(351
)
 
(78
)
 
(173
)
 
(251
)
Net (loss) income
 
(2,729
)
 
 
 
(1,781
)
 
68

 
 
 
614

(Loss) income per diluted share
 
(0.17
)
 
 
 
(0.11
)
 
0.00

 
 
 
0.04


About Non-GAAP Financial Measures

The Company reports its financial results in accordance with GAAP.  However, non-GAAP adjusted financial measures, as set forth in the reconciliation table above, are provided because management uses these non-GAAP financial measures in evaluating the results of the Company's continuing operations and believes this information provides investors supplemental insight into underlying business trends and operating results. These non-GAAP financial measures are not based on any comprehensive set of accounting rules or principles and should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP. In addition, these non-GAAP financial measures should be read in conjunction with the Company’s financial statements prepared in accordance with GAAP.

The Company's results of operations are impacted by certain non-recurring charges, including equity based compensation, acquisition related expenditures, expense relating to the internal investigation into conduct in China and Singapore and the SEC document subpoena, and other non-recurring charges that may not be indicative of the Company’s financial performance. Management believes that adjusting its operating expenses, operating loss, net loss and diluted loss per share to remove non-recurring charges provides a useful perspective with respect to our operating results and provides supplemental information to both management and investors by removing items that are difficult to predict and are often unanticipated.  While the Company




believes the adjustments provide a useful comparison, the reconciliations of non-GAAP financial measures to corresponding GAAP measures should be carefully evaluated.

During the first quarter of 2019, the Company recorded $568,000 of severance expenses, of which $143,000 are included in costs of sales, $317,000 are included in selling, general and administrative expenses and $108,000 are included in research and development expenses. The Company recorded $190,000 of expenses related to the Company’s internal investigation into conduct at its China and Singapore offices and the SEC document subpoena. Additionally, $248,000 of equity based compensation charges were recorded during the first quarter of 2019. The Company recognized amortization of acquired intangible assets of $241,000 related to the Company’s 2014 acquisition of Brink Software, Inc. (the "Brink Acquisition"). The provision for income tax line above is netted down by a 24%, or $299,000 tax impact from non-GAAP adjustments.

During the first quarter of 2018, the Company recorded $297,000 of expenses related to the Company’s internal investigation and the SEC document subpoena. Additionally, $181,000 of equity based compensation charges were recorded during the first quarter of 2018. The Company recognized amortization of acquired intangible assets of $241,000 related to the Company’s 2014 Brink Acquisition. The provision for income tax line above is netted down by a 24% or $173,000 tax impact from non-GAAP adjustments.