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.