EX-99.1 2 ex99_1.htm EXHIBIT 99.1
Exhibit 99.1
Press Release dated July 31, 2014
 
FOR RELEASE:
 
CONTACT:
 
New Hartford, NY, July 31, 2014
 
Christopher R. Byrnes (315) 738-0600 ext. 6226
cbyrnes@partech.com,  www.partech.com
 
PAR TECHNOLOGY CORPORATION ANNOUNCES
2014 SECOND QUARTER RESULTS FROM CONTINUING OPERATIONS

New Hartford, NY- July 31, 2014 -- PAR Technology Corporation (NYSE: PAR) today announced results from continuing operations for the second quarter ended June 30, 2014.  PAR reported revenues from continuing operations of $57.4 million and net loss of $519,000 or $0.03 loss per share.  On a non-GAAP basis, the Company’s net loss from continuing operations for the second quarter was $336,000 or $0.02 loss per share.  During the second quarter of 2013, PAR reported revenue from continuing operations of $59.5 million and net income of $248,000 or $0.02 per diluted share.  On a non-GAAP basis, the Company’s net income from continuing operations was $302,000 or $0.02 per diluted share for the second quarter of 2013.  The non-GAAP results for the second quarter exclude charges related to the Company’s equity based compensation plans.
 
Commenting on the second quarter, Ronald J. Casciano, Chief Executive Officer & President, stated, “Although not unexpected, our results were impacted in the quarter by lower revenues in our Government segment due to the timing of certain task orders.  Our bottom line results were impacted by the continuing investments in our hospitality segment and specifically regarding our next generation hotel products.  However, we continue to make progress on executing that investment strategy and are making important strides towards broadening our customer base as well.  While certainly not satisfied with our results, we remain confident in our market opportunities and our leading technology and services in our Hospitality and Government segments.”
 
Certain Company information in this release or statements made by its spokespersons from time to time may contain forward-looking statements.  Any statements in this document that do and not describe historical facts are forward-looking statements.  Forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.  Investors are cautioned that all forward-looking statements involve risks and uncertainties, including without limitation, delays in new product introduction, risks in technology development and commercialization, risks in product development and market acceptance of and demand for the Company’s products, risks of downturns in economic conditions generally, and in the quick service sector of the restaurant market specifically, risks of intellectual property rights associated with competition and competitive pricing pressures, risks associated with foreign sales and high customer concentration, and other risks detailed in the Company’s filings with the Securities and Exchange Commission.
About PAR Technology Corporation
 
PAR Technology Corporation's stock is traded on the New York Stock Exchange under the symbol PAR.  PAR’s Hospitality segment has been a leading provider of restaurant and retail technology for more than 30 years.  PAR offers technology solutions for the full spectrum of restaurant operations, from large chain and independent table service restaurants to international quick service chains.  PAR’s Hospitality business also provides hotel management systems with a complete suite of powerful tools for guest management, recreation management, and timeshare/condo management.  In addition, PAR offers the spa industry a leading management application specifically designed to support the unique needs of the resort spa and day spa markets, a rapidly growing hospitality segment.  Products from PAR also can be found in retailers, cinemas, cruise lines, stadiums and food service companies. PAR’s Government Business is a leader in providing computer-based system design, engineering and technical services to the Department of Defense and various federal agencies. Visit www.partech.com for more information.
 
There will be a conference call at 10:00 a.m. (Eastern) on July 31, 2014, during which the Company’s management will discuss the financial results for the second quarter of 2014.  If you would like to participate in this conference call, please dial 1-877-546-5018 approximately 10 minutes before the scheduled beginning and use the PAR passcode 40572879.  Individual and institutional investors also will have the opportunity to listen to the conference call live over the Internet.  Individual investors can listen by visiting PAR’s website at www.partech.com.  If you are unable to participate in the conference call, an automatic replay will be available until August 7, 2014 via www.partech.com or via telephone by dialing 1-888-286-8010 and using the passcode 72099280.

###
PAR TECHNOLOGY CORPORATION
CONSOLIDATED BALANCE SHEETS
(in thousands, except share amounts)
 
 
  
June 30,
    
December 31,
  
Assets
  
2014
    
2013
  
Current assets:
        
Cash and cash equivalents
  
$
12,953
    
$
10,015
  
Accounts receivable-net
    
31,333
      
30,688
  
Inventories-net
    
22,425
      
24,465
  
Income tax refund
    
256
      
-
  
Deferred income taxes
    
4,694
      
3,747
  
Other current assets
    
3,249
      
3,418
  
Total current assets
    
74,910
      
72,333
  
Property, plant and equipment - net
    
5,935
      
5,494
  
Deferred income taxes
    
14,491
      
15,083
  
Goodwill
    
6,852
      
6,852
  
Intangible assets - net
    
15,664
      
15,071
  
Other assets
    
2,896
      
2,675
  
Total Assets
  
$
120,748
    
$
117,508
  
Liabilities and Shareholders’ Equity
                
Current liabilities:
                
Current portion of long-term debt
  
$
169
    
$
166
  
Accounts payable
    
17,735
      
17,200
  
Accrued salaries and benefits
    
5,962
      
6,663
  
Accrued expenses
    
3,711
      
2,701
  
Customer deposits
    
751
      
1,071
  
Deferred service revenue
    
15,921
      
12,170
  
Income taxes payable
    
-
      
185
  
Total current liabilities
    
44,249
      
40,156
  
Long-term debt
    
833
      
918
  
Other long-term liabilities
    
3,705
      
3,714
  
Total liabilities
    
48,787
      
44,788
  
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; 17,332,218 and 17,301,925 shares issued; 15,624,109 and 15,593,816 outstanding
    
347
      
344
  
Capital in excess of par value
    
44,466
      
43,635
  
Retained earnings
    
33,608
      
35,116
  
Accumulated other comprehensive loss
    
(624
)
    
(539
)
Treasury stock, at cost, 1,708,109 shares
    
(5,836
)
    
(5,836
)
Total shareholders’ equity
    
71,961
      
72,720
  
Total Liabilities and Shareholders’ Equity
  
$
120,748
    
$
117,508
  
PAR TECHNOLOGY CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
 (in thousands, except per share amounts)
 
 
  
For the three
months ended
June 30,
    
For the three
months ended
June 30,
    
For the six
months ended
June 30,
    
For the six
months ended
June 30,
  
 
  
2014
    
2013
    
2014
    
2013
  
Net revenues:
                
Product
  
$
22,953
    
$
22,257
    
$
41,545
    
$
46,173
  
Service
    
14,920
      
15,314
      
29,170
      
31,334
  
Contract
    
19,529
      
21,945
      
43,228
      
48,683
  
 
    
57,402
      
59,516
      
113,943
      
126,190
  
Costs of sales:
                                
Product
    
15,815
      
14,841
      
28,718
      
31,314
  
Service
    
10,831
      
10,904
      
20,384
      
22,456
  
Contract
    
18,495
      
20,312
      
40,567
      
45,791
  
 
    
45,141
      
46,057
      
89,669
      
99,561
  
Gross margin
    
12,261
      
13,459
      
24,274
      
26,629
  
Operating expenses:
                                
Selling, general and administrative
    
9,513
      
9,494
      
18,776
      
19,699
  
Research and development
    
3,761
      
3,706
      
7,625
      
7,846
  
 
    
13,274
      
13,200
      
26,401
      
27,545
  
Operating income (loss) from continuing operations
    
(1,013
)
    
259
      
(2,127
)
    
(916
)
Other income net
    
406
      
255
      
328
      
221
  
Interest expense
    
(25
)
    
(13
)
    
(42
)
    
(26
)
Income (loss) from continuing operations before (provision) benefit for income taxes
    
(632
)
    
501
      
(1,841
)
    
(721
)
(Provision) benefit for income taxes
    
113
      
(253
)
    
333
      
600
  
Income (loss) from continuing operations
    
(519
)
    
248
      
(1,508
)
    
(121
)
Discontinued operations
                                
Loss on discontinued operations (net of tax)
    
-
      
(191
)
    
-
      
(206
)
Net Income (loss)
  
$
(519
)
  
$
57
    
$
(1,508
)
  
$
(327
)
Basic Earnings per Share:
                                
Income (loss) from continuing operations
    
(0.03
)
    
0.02
      
(0.10
)
    
(0.01
)
Loss from discontinued operations
    
-
      
(0.01
)
    
-
      
(0.01
)
Net income (loss)
  
$
(0.03
)
  
$
0.00
    
$
(0.10
)
  
$
(0.02
)
Diluted Earnings per Share:
                                
Loss from continuing operations
    
(0.03
)
    
0.02
      
(0.10
)
    
(0.01
)
Loss from discontinued operations
    
-
      
(0.01
)
    
-
      
(0.01
)
Net income (loss)
  
$
(0.03
)
  
$
0.00
    
$
(0.10
)
  
$
(0.02
)
Weighted average shares outstanding
                                
Basic
    
15,612
      
15,171
      
15,473
      
15,162
  
Diluted
    
15,612
      
15,340
      
15,473
      
15,162
  

PAR TECHNOLOGY CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL RESULTS
(in thousands, except per share data)

 
  
For the three months ended June 30, 2014
    
For the three months ended June 30, 2013
  
 
  
Reported
basis (GAAP)
    
Adjustments
    
Comparable
basis (Non-
GAAP)
    
Reported
basis (GAAP)
    
Adjustments
    
Comparable
basis (Non-
GAAP)
  
 
                        
Net revenues
  
$
57,402
      
-
    
$
57,402
    
$
59,516
      
-
    
$
59,516
  
Costs of sales
    
45,141
      
-
      
45,141
      
46,057
      
-
      
46,057
  
Gross Margin
    
12,261
      
-
      
12,261
      
13,459
      
-
      
13,459
  
 
                                                
Operating Expenses
                                                
Selling, general and administrative
    
9,513
      
278
      
9,235
      
9,494
      
82
      
9,412
  
Research and development
    
3,761
      
-
      
3,761
      
3,706
      
-
      
3,706
  
Total operating expenses
    
13,274
      
278
      
12,996
      
13,200
      
82
      
13,118
  
Operating (income) loss from continuing operations
    
(1,013
)
    
278
      
(735
)
    
259
      
82
      
341
  
Other income (expense), net
    
406
      
-
      
406
      
255
      
-
      
255
  
Interest expense
    
(25
)
    
-
      
(25
)
    
(13
)
    
-
      
(13
)
Income (loss) from continuing operations before (provision) benefit for income taxes
    
(632
)
    
278
      
(354
)
    
501
      
82
      
583
  
(Provision) benefit for income taxes
    
113
      
(95
)
    
18
      
(253
)
    
(28
)
    
(281
)
Income (loss) from continuing operations
  
$
(519
)
  
$
183
    
$
(336
)
  
$
248
    
$
54
    
$
302
  
Income (loss) from discontinued operations, (net of tax)
  
$
-
            
$
-
    
$
(191
)
          
$
(191
)
Net income (loss)
  
$
(519
)
          
$
(336
)
  
$
57
            
$
111
  
Income (loss) per diluted share from continuing operations
  
$
(0.03
)
          
$
(0.02
)
  
$
0.02
            
$
0.02
  
Income (loss) per diluted share from discontinuing operations
    
-
              
-
    
$
(0.01
)
          
$
(0.01
)
Income (loss) per diluted share
  
$
(0.03
)
          
$
(0.02
)
  
$
0.00
            
$
(0.01
)
 
The Company reports its financial results in accordance with GAAP, which refers financial information presented in accordance with generally accepted accounting principles in the United States.  However, non-GAAP adjusted financial measures, as defined in the reconciliation table above, are provided herein because management uses such measures in evaluating the results of the continuing operations of the Company and believes this information provides investors better insight into underlying business trends and performance.  Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, the Company's reported results prepared in accordance with GAAP.
 
The adjustments for the three months ended June 30, relate to the Company’s stock compensation expense included within the Company’s operating expenses. During the second quarter of 2014, the Company recorded a charge of $278,000 for equity based compensation expense as compared to $82,000 recorded during the second quarter of 2013.

PAR TECHNOLOGY CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL RESULTS
(in thousands, except per share data)
 
 
  
For the six months ended June 30, 2014
    
For the six months ended June 30, 2013
  
 
  
Reported
basis (GAAP)
    
Adjustments
    
Comparable
basis (Non-
GAAP)
    
Reported
basis (GAAP)
    
Adjustments
    
Comparable
basis (Non-
GAAP)
  
 
                        
Net revenues
  
$
113,943
      
-
    
$
113,943
    
$
126,190
      
-
    
$
126,190
  
Costs of sales
    
89,669
      
-
      
89,669
      
99,561
      
-
      
99,561
  
Gross Margin
    
24,274
      
-
      
24,274
      
26,629
      
-
      
26,629
  
 
                                                
Operating Expenses
                                                
Selling, general and administrative
    
18,776
      
802
      
17,974
      
19,699
      
822
      
18,877
  
Research and development
    
7,625
              
7,625
      
7,846
      
106
      
7,740
  
Total operating expenses
    
26,401
      
802
      
25,599
      
27,545
      
928
      
26,617
  
Operating income (loss) from continuing operations
    
(2,127
)
    
802
      
(1,325
)
    
(916
)
    
928
      
12
 
Other expense, net
    
328
      
-
      
328
      
221
      
-
      
221
  
Interest expense
    
(42
)
    
-
      
(42
)
    
(26
)
    
-
      
(26
)
Income (loss) from continuing operations before (provision) benefit for income taxes
    
(1,841
)
    
802
      
(1,039
)
    
(721
)
    
928
      
207
 
(Provision) benefit for income taxes
    
333
      
(273
)
    
60
      
600
      
(316
)
    
284
  
Income (loss) from continuing operations
  
$
(1,508
)
  
$
529
    
$
(979
)
  
$
(121
)
  
$
612
    
$
491
  
Income (loss) from discontinued operations, (net of tax)
  
$
-
            
$
-
    
$
(206
)
          
$
(206
)
Net income (loss)
  
$
(1,508
)
          
$
(979
)
  
$
(327
)
          
$
285
  
Income (loss) per diluted share from continuing operations
  
$
(0.10
)
          
$
(0.06
)
  
$
(0.01
)
          
$
0.03
  
Income (loss) per diluted share from discontinuing operations
    
-
              
-
    
$
(0.01
)
          
$
(0.01
)
Income (loss) per diluted share
  
$
(0.10
)
          
$
(0.06
)
  
$
(0.02
)
          
$
0.02
  
 
During the six months ended June 30, 2014, the Company recorded $802,000 for equity based compensation expense. During the first six months of 2013, the Company recorded total charges of $928,000, which included a benefit of $281,000 related to equity compensation expense.  The other charges of $1,209,000 were composed of $938,000 for separation related charges and legal costs of $271,000 associated with an intellectual property matter that was settled during 2013.  The aforementioned charges, along with an associated adjustment to the Company’s provision for income taxes have been excluded in the Company’s non-GAAP measures because they are considered non-recurring in nature and are quantitatively and qualitatively different from the Company’s core operations during any particular period.