ePlus Reports First Quarter Fiscal Year 2025 Financial Results
ePlus (NASDAQ: PLUS) announced fiscal Q1 2025 results: net sales fell 5.2% to $544.5M, with technology business sales down 5.3% to $535.5M but services revenue up 15.8% to $78.2M. Technology gross billings decreased 1% to $833.7M, while gross profit dropped 5.5% to $134.5M, and gross margin slightly dipped to 24.7% from 24.8%. Net earnings declined 19.2% to $27.3M, with adjusted EBITDA down 19.9% to $43.1M. Diluted EPS fell 19.7% to $1.02. Despite sales decline, ePlus saw strong growth in managed services, up 28%, and ended the quarter with $350M in cash. ePlus maintains FY 2025 guidance for 3%-6% net sales growth and adjusted EBITDA of $200M-$215M. The company attributes revenue decline to normalized supply chains and remains optimistic about long-term demand and strategic acquisitions.
ePlus (NASDAQ: PLUS) ha annunciato i risultati per il primo trimestre fiscale del 2025: le vendite nette sono diminuite del 5,2% a 544,5 milioni di dollari, con le vendite del settore tecnologico in calo del 5,3% a 535,5 milioni di dollari, ma i ricavi dei servizi sono aumentati del 15,8% a 78,2 milioni di dollari. Le fatturazioni lorde tecnologiche sono scese dell'1% a 833,7 milioni di dollari, mentre il profitto lordo è diminuito del 5,5% a 134,5 milioni di dollari e il margine lordo è leggermente diminuito al 24,7% rispetto al 24,8%. Gli utili netti sono diminuiti del 19,2% a 27,3 milioni di dollari, con un EBITDA rettificato in calo del 19,9% a 43,1 milioni di dollari. L’EPS diluito è sceso del 19,7% a 1,02 dollari. Nonostante la diminuzione delle vendite, ePlus ha registrato una forte crescita nei servizi gestiti, in aumento del 28%, e ha chiuso il trimestre con 350 milioni di dollari in contante. ePlus mantiene le previsioni per l'anno fiscale 2025, con una crescita delle vendite nette del 3%-6% e un EBITDA rettificato di 200-215 milioni di dollari. L’azienda attribuisce la diminuzione dei ricavi alla normalizzazione delle catene di approvvigionamento e rimane ottimista riguardo alla domanda a lungo termine e alle acquisizioni strategiche.
ePlus (NASDAQ: PLUS) anunció los resultados del primer trimestre fiscal de 2025: las ventas netas cayeron un 5,2% a 544,5 millones de dólares, con las ventas del negocio tecnológico disminuyendo un 5,3% a 535,5 millones de dólares, pero los ingresos por servicios aumentaron un 15,8% a 78,2 millones de dólares. Las facturaciones brutas tecnológicas disminuyeron un 1% a 833,7 millones de dólares, mientras que la ganancia bruta cayó un 5,5% a 134,5 millones de dólares y el margen bruto disminuyó ligeramente al 24,7% desde el 24,8%. Las ganancias netas cayeron un 19,2% a 27,3 millones de dólares, con un EBITDA ajustado en descenso del 19,9% a 43,1 millones de dólares. El EPS diluido cayó un 19,7% a 1,02 dólares. A pesar de la caída en las ventas, ePlus vio un fuerte crecimiento en los servicios gestionados, con un aumento del 28%, y terminó el trimestre con 350 millones de dólares en efectivo. ePlus mantiene la guía para el año fiscal 2025 de un crecimiento de ventas netas del 3%-6% y un EBITDA ajustado de 200-215 millones de dólares. La empresa atribuye la disminución de los ingresos a la normalización de las cadenas de suministro y se mantiene optimista acerca de la demanda a largo plazo y las adquisiciones estratégicas.
ePlus (NASDAQ: PLUS)는 2025 회계연도 1분기 실적을 발표했습니다: 순매출은 5.2% 감소하여 5억 4,450만 달러에 이르렀고, 기술 사업 매출은 5.3% 감소하여 5억 3,550만 달러였으며, 서비스 수익은 15.8% 증가하여 7,820만 달러에 달했습니다. 기술 총 청구액은 1% 감소하여 8억 3,370만 달러에 이르렀고, 총 이익은 5.5% 감소하여 1억 3,450만 달러로 줄어들었으며, 총 마진은 24.8%에서 24.7%로 약간 하락했습니다. 순이익은 19.2% 감소하여 2,730만 달러에 이르렀고, 조정 EBITDA는 19.9% 감소하여 4,310만 달러로 줄어들었습니다. 희석 주당순이익(EPS)은 19.7% 감소하여 1.02 달러로 떨어졌습니다. 판매 감소에도 불구하고, ePlus는 관리 서비스에서 28%의 강력한 성장을 보였으며, 분기를 3억 5천만 달러의 현금으로 마감했습니다. ePlus는 2025 회계연도에 대해 3%-6%의 순매출 성장과 2억-2억 1,500만 달러의 조정 EBITDA 지침을 유지하고 있습니다. 이 회사는 매출 감소의 원인을 정상화된 공급망으로 돌리며, 장기적인 수요와 전략적 인수에 대해 낙관적이라고 밝혔습니다.
ePlus (NASDAQ: PLUS) a annoncé les résultats du premier trimestre fiscal 2025 : les ventes nettes ont baissé de 5,2 % pour atteindre 544,5 millions de dollars, les ventes de l’activité technologique ayant diminué de 5,3 % pour atteindre 535,5 millions de dollars, tandis que les revenus des services ont augmenté de 15,8 % pour atteindre 78,2 millions de dollars. Les facturations brutes technologiques ont diminué de 1 % pour s’établir à 833,7 millions de dollars, tandis que le bénéfice brut a chuté de 5,5 % pour atteindre 134,5 millions de dollars, et la marge brute a légèrement reculé à 24,7 % contre 24,8 %. Les bénéfices nets ont reculé de 19,2 % pour atteindre 27,3 millions de dollars, le EBITDA ajusté ayant diminué de 19,9 % pour s’établir à 43,1 millions de dollars. Le BPA dilué a chuté de 19,7 % pour atteindre 1,02 dollar. Malgré la baisse des ventes, ePlus a connu une forte croissance dans les services gérés, avec une augmentation de 28 %, et a terminé le trimestre avec 350 millions de dollars de liquidités. ePlus maintient ses prévisions pour l’exercice 2025 d’une croissance des ventes nettes de 3 % à 6 % et un EBITDA ajusté de 200 à 215 millions de dollars. L’entreprise attribue la baisse des revenus à des chaînes d’approvisionnement normalisées et reste optimiste concernant la demande à long terme et les acquisitions stratégiques.
ePlus (NASDAQ: PLUS) hat die Ergebnisse für das erste Quartal des Geschäftsjahres 2025 bekannt gegeben: Die netto Verkaufszahlen sind um 5,2% auf 544,5 Millionen USD gefallen, wobei die Verkaufszahlen im Technologiebereich um 5,3% auf 535,5 Millionen USD gesunken sind, aber die Dienstleistungserträge um 15,8% auf 78,2 Millionen USD gestiegen sind. Die brutto Technologien-Abrechnungen haben um 1% auf 833,7 Millionen USD abgenommen, während der Bruttogewinn um 5,5% auf 134,5 Millionen USD gesunken ist, und die Bruttomarge leicht auf 24,7% von 24,8% gesunken ist. Der Nettogewinn fiel um 19,2% auf 27,3 Millionen USD, das bereinigte EBITDA verringerte sich um 19,9% auf 43,1 Millionen USD. Der verwässerte Gewinn je Aktie (EPS) fiel um 19,7% auf 1,02 USD. Trotz des Rückgangs der Verkaufszahlen verzeichnete ePlus ein starkes Wachstum im Bereich der verwalteten Dienstleistungen, das um 28% anstieg, und beendete das Quartal mit 350 Millionen USD in bar. ePlus hält an der Prognose für das Geschäftsjahr 2025 von 3%-6% Wachstum der Nettoumsätze und einem bereinigten EBITDA von 200-215 Millionen USD fest. Das Unternehmen führt den Umsatzrückgang auf normalisierte Lieferketten zurück und bleibt optimistisch in Bezug auf die langfristige Nachfrage und strategische Übernahmen.
- Services revenue increased 15.8% to $78.2M.
- Managed service revenues rose 28% to $40.9M.
- Financing business segment net sales increased 6.4% to $9M.
- Cash and cash equivalents grew to $350M.
- Maintained FY 2025 guidance of 3%-6% net sales growth and adjusted EBITDA of $200M-$215M.
- Net sales decreased 5.2% to $544.5M.
- Technology business net sales fell 5.3% to $535.5M.
- Gross profit dropped 5.5% to $134.5M.
- Net earnings declined 19.2% to $27.3M.
- Adjusted EBITDA decreased 19.9% to $43.1M.
- Diluted EPS fell 19.7% to $1.02.
Insights
ePlus' Q1 FY2025 results show mixed performance. While net sales decreased 5.2% to
The decrease in net earnings by 19.2% to
Maintaining the full-year guidance suggests management's confidence in the business model. Investors should monitor the company's ability to capitalize on AI trends and its success in transitioning to a more service-oriented business model.
ePlus' focus on AI and managed services is strategically sound. The AI Ignite program and discovery services position the company well in the rapidly evolving AI market. While these initiatives may not generate significant immediate revenue, they're important for securing future business opportunities.
The 28% growth in managed services is particularly noteworthy, indicating strong demand for ePlus' ongoing support offerings. This trend aligns with the broader industry shift towards subscription-based models and recurring revenue streams.
The decrease in product sales, especially in cloud and networking, warrants attention. However, the increase in collaboration and security product sales suggests ePlus is adapting to changing market demands. The company's ability to navigate these shifts will be important for long-term success in the dynamic tech solutions market.
First Quarter Fiscal Year 2025
- Net sales decreased
5.2% to$544.5 million 5.3% to$535.5 million 15.8% to$78.2 million - Technology business gross billings decreased
1.0% to$833.7 million - Consolidated gross profit decreased
5.5% to$134.5 million - Consolidated gross margin was
24.7% as compared to last year's24.8% . - Net earnings decreased
19.2% to$27.3 million - Adjusted EBITDA decreased
19.9% to$43.1 million - Diluted net earnings per common share decreased
19.7% to$1.02 19.9% to$1.13
Management Comment
"We continued to see strong growth in security and services overall with our managed services up
"Given a hard compare, with last year's first quarter growth of
Mr. Marron continued, "We ended the quarter with a strong cash position of
First Quarter Fiscal Year 2025 Results
For the first quarter ended June 30, 2024, as compared to the first quarter ended June 30, 2023:
Consolidated net sales decreased
Technology business net sales decreased
Product sales decreased
Professional service revenues increased
Managed service revenues increased
Financing business segment net sales increased
Consolidated gross profit decreased
Consolidated operating expenses were
Consolidated operating income decreased
Our effective tax rate remained at
Net earnings decreased
Consolidated adjusted EBITDA decreased
Diluted net earnings per common share was
Balance Sheet Highlights
As of June 30, 2024, cash and cash equivalents were
Fiscal Year Guidance
ePlus is maintaining fiscal year 2025 guidance for net sales growth over the prior fiscal year of between
Summary and Outlook
"Looking ahead, as we add new products and services and benefit from recent acquisitions, ePlus continues to be positioned to achieve top-line growth. Our business is supported by deep customer and channel relationships. We have invested across the organization to strengthen our product and services offerings and to customize our solutions to meet the evolving needs of our customers. Our teams continue to execute well and operate efficiently with an unwavering commitment to superior customer service. These factors support our confidence in the underlying fundamentals of our business and our ability to deliver on our 2025 financial outlook and objectives.
"Additionally, our strong financial position provides us with considerable capital allocation options to drive long-term shareholder value, including the ability to expand our product offerings, make larger accretive acquisitions, and continue to return capital to shareholders through share repurchases. This flexibility, together with ongoing investments in differentiated capabilities, should enable us to build on our competitive advantage and advance our market positioning," concluded Mr. Marron.
Recent Corporate Developments/Recognitions
In the month of July:
- Announced Storage-as-a-Service leveraging NetApp.
- IGXGlobal, a subsidiary of ePlus, began offering Storage-as-a-Service powered by Pure Storage.
In the month of June:
- Awarded the Lenovo
U.S. Infrastructure Solutions Partner of the Year Award. - Announced the launch of Azure Recover.
- Recognized as Juniper Networks 2023 Partner of the Year for Cloud Ready Data Center in both Worldwide and Americas Categories.
In the month of May:
- Named Growth Partner of the Year by Varonis.
- Earned a spot on CRN's 2024 Solution Provider 500 List.
Conference Call Information
ePlus will hold a conference call and webcast at 4:30 p.m. ET on August 6, 2024:
Date: | August 6, 2024 |
Time: | 4:30 p.m. ET |
Audio Webcast (Live & Replay): | https://events.q4inc.com/attendee/653117486 |
Live Call: | (888) 596-4144 (toll-free/domestic) |
(646) 968-2525 (international) | |
Archived Call: | (800) 770-2030 (toll-free/domestic) |
(609) 800-9909 (international) | |
Conference ID: | 6593768# (live call and replay) |
A replay of the call will be available approximately two hours after the call through August 13, 2024. A transcript of the call will also be available on the ePlus Investor Relations website at https://www.eplus.com/investors.
About ePlus inc.
ePlus has an unwavering and relentless focus on leveraging technology to create inspired and transformative business outcomes for its customers. Offering a robust portfolio of solutions, as well as a broad range of consultative and managed services across the technology spectrum, ePlus has proudly achieved more than 30 years of success, carrying customers forward through adversity, rapidly changing environments, and other obstacles. ePlus is a trusted advisor, bringing expertise, credentials, talent and a thorough understanding of innovative technologies, spanning security, cloud, data center, networking, collaboration and emerging solutions, to organizations across all industry segments. With complete lifecycle management services and flexible payment solutions, ePlus' more than 1,900 associates are focused on cultivating positive customer experiences and are dedicated to their craft, harnessing new knowledge while applying decades of proven experience. ePlus is headquartered in
ePlus® and ePlus products referenced herein are either registered trademarks or trademarks of ePlus inc. in
Forward-looking statements
Statements in this press release that are not historical facts may be deemed to be "forward-looking statements," including, among other things, statements regarding the future financial performance of ePlus. Actual and anticipated future results may vary materially due to certain risks and uncertainties, including, without limitation, exposure to fluctuation in foreign currency rates, interest rates, and inflation, including as a result of national and international political instability fostering uncertainty and volatility in the global economy, which may cause increases in our costs and our ability to increase prices to our customers, negative impacts to the arrangements that have pricing commitments over the term of the agreement, which may result in adverse changes in our gross profit; significant adverse changes in, reductions in, or loss of one or more of our larger volume customers or vendors; reliance on third-parties to perform some of our service obligations to our customers, and the reliance on a small number of key vendors in our supply chain with whom we do not have long-term supply agreements, guaranteed price agreements, or assurance of stock availability; our ability to remain secure during a cybersecurity attack or other IT outtage, including both disruptions in our or our vendors' or other third party's Information Technology ("IT") systems and data and audio communication networks; our ability to secure our own and our customers' electronic and other confidential information, while maintaining compliance with evolving data privacy and regulatory laws and regulations; ongoing remote work trends, and the increase in cybersecurity attacks that have occurred while employees work remotely and our ability to adequately train our personnel to prevent a cyber event; the possibility of a reduction of vendor incentives provided to us; our dependence on key personnel and our ability to hire, train and retain qualified personnel by recruiting and retaining highly skilled, competent personnel, and vendor certifications; our ability to manage a diverse product set of solutions, including artificial intelligence ("AI") products, in highly competitive markets with a number of key vendors; changes in the IT industry and/or rapid changes in product offerings, including the proliferation of the cloud, infrastructure as a service, software as a service, platform as a service and AI; supply chain issues, including a shortage of IT products, may increase our costs or cause a delay in fulfilling customer orders, or increase our need for working capital, or delay completing professional services, or purchasing IT products or services needed to support our internal infrastructure or operations, resulting in an adverse impact on our financial results; our inability to identify acquisition candidates, or perform sufficient due diligence prior to completing an acquisition, or failure to integrate a completed acquisition may affect our earnings; our ability to raise capital, maintain or increase as needed our lines of credit with vendors or floor planning facility, obtain debt for our financing transactions, or the effect of those changes on our common stock price; our ability to implement comprehensive plans for the integration of sales forces, cost containment, asset rationalization, systems integration, and other key strategies; and other risks or uncertainties detailed in our reports filed with the Securities and Exchange Commission. All information set forth in this press release is current as of the date of this release and ePlus undertakes no duty or obligation to update this information.
ePlus inc. AND SUBSIDIARIES | ||||
UNAUDITED CONSOLIDATED BALANCE SHEETS | ||||
(in thousands, except per share amounts) | ||||
June 30, 2024 | March 31, 2024 | |||
ASSETS | ||||
Current assets: | ||||
Cash and cash equivalents | ||||
Accounts receivable—trade, net | 577,019 | 644,616 | ||
Accounts receivable—other, net | 54,987 | 46,884 | ||
Inventories | 89,134 | 139,690 | ||
Financing receivables—net, current | 109,119 | 102,600 | ||
Deferred costs | 59,985 | 59,449 | ||
Other current assets | 23,951 | 27,269 | ||
Total current assets | 1,264,104 | 1,273,529 | ||
Financing receivables and operating leases—net | 85,032 | 79,435 | ||
Deferred tax asset | 5,620 | 5,620 | ||
Property, equipment and other assets | 94,417 | 89,289 | ||
Goodwill | 161,508 | 161,503 | ||
Other intangible assets—net | 40,292 | 44,093 | ||
TOTAL ASSETS | ||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||
LIABILITIES | ||||
Current liabilities: | ||||
Accounts payable | ||||
Accounts payable—floor plan | 119,511 | 105,104 | ||
Salaries and commissions payable | 40,491 | 43,696 | ||
Deferred revenue | 138,619 | 134,596 | ||
Non-recourse notes payable—current | 29,898 | 23,288 | ||
Other current liabilities | 29,103 | 34,630 | ||
Total current liabilities | 628,236 | 656,990 | ||
Non-recourse notes payable—long-term | 10,854 | 12,901 | ||
Other liabilities | 89,955 | 81,799 | ||
TOTAL LIABILITIES | 729,045 | 751,690 | ||
COMMITMENTS AND CONTINGENCIES | ||||
STOCKHOLDERS' EQUITY | ||||
Preferred stock, | - | - | ||
Common stock, | 276 | 274 | ||
Additional paid-in capital | 184,733 | 180,058 | ||
Treasury stock, at cost, 609 shares at June 30, 2024 and | ||||
447 shares at March 31, 2024 | (35,746) | (23,811) | ||
Retained earnings | 770,317 | 742,978 | ||
Accumulated other comprehensive income—foreign currency | ||||
translation adjustment | 2,348 | 2,280 | ||
Total Stockholders' Equity | 921,928 | 901,779 | ||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY |
ePlus inc. AND SUBSIDIARIES | |||||
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||
(in thousands, except per share amounts) | |||||
Three Months Ended June 30, | |||||
2024 | 2023 | ||||
Net sales | |||||
Product | |||||
Services | 78,189 | 67,519 | |||
Total | 544,538 | 574,175 | |||
Cost of sales | |||||
Product | 360,157 | 388,904 | |||
Services | 49,900 | 42,998 | |||
Total | 410,057 | 431,902 | |||
Gross profit | 134,481 | 142,273 | |||
Selling, general, and administrative | 93,608 | 90,298 | |||
Depreciation and amortization | 4,819 | 4,792 | |||
Interest and financing costs | 585 | 851 | |||
Operating expenses | 99,012 | 95,941 | |||
Operating income | 35,469 | 46,332 | |||
Other income (expense), net | 2,073 | 190 | |||
Earnings before taxes | 37,542 | 46,522 | |||
Provision for income taxes | 10,203 | 12,675 | |||
Net earnings | |||||
Net earnings per common share—basic | |||||
Net earnings per common share—diluted | |||||
Weighted average common shares outstanding—basic | 26,642 | 26,552 | |||
Weighted average common shares outstanding—diluted | 26,801 | 26,648 | |||
Technology Business | |||||||
Three Months Ended June 30, | |||||||
2024 | 2023 | Change | |||||
(in thousands) | |||||||
Net sales | |||||||
Product | (8.2 %) | ||||||
Professional services | 37,279 | 35,556 | 4.8 % | ||||
Managed services | 40,910 | 31,963 | 28.0 % | ||||
Total | 535,501 | 565,685 | (5.3 %) | ||||
Gross profit | |||||||
Product | 98,505 | 111,391 | (11.6 %) | ||||
Professional services | 15,455 | 14,724 | 5.0 % | ||||
Managed services | 12,834 | 9,797 | 31.0 % | ||||
Total | 126,794 | 135,912 | (6.7 %) | ||||
Selling, general, and administrative | 90,084 | 87,100 | 3.4 % | ||||
Depreciation and amortization | 4,819 | 4,764 | 1.2 % | ||||
Interest and financing costs | - | 550 | (100.0 %) | ||||
Operating expenses | 94,903 | 92,414 | 2.7 % | ||||
Operating income | (26.7 %) | ||||||
Gross billings | (1.0 %) | ||||||
Adjusted EBITDA | (22.5 %) | ||||||
Technology Business Gross Billings by Type
| |||||||
Three Months Ended June 30, | |||||||
2024 | 2023 | Change | |||||
(in thousands) | |||||||
Networking | 1.8 % | ||||||
Cloud | 241,274 | 258,924 | (6.8 %) | ||||
Security | 151,883 | 147,343 | 3.1 % | ||||
Collaboration | 32,976 | 22,161 | 48.8 % | ||||
Other | 44,592 | 69,761 | (36.1 %) | ||||
Product gross billings | 752,253 | 774,834 | (2.9 %) | ||||
Service gross billings | 81,455 | 67,136 | 21.3 % | ||||
Total gross billings | (1.0 %) | ||||||
Technology Business Net Sales by Type
| |||||||
Three Months Ended June 30, | |||||||
2024 | 2023 | Change | |||||
(in thousands) | |||||||
Networking | (4.3 %) | ||||||
Cloud | 137,231 | 172,044 | (20.2 %) | ||||
Security | 48,005 | 45,796 | 4.8 % | ||||
Collaboration | 20,899 | 12,956 | 61.3 % | ||||
Other | 16,437 | 22,182 | (25.9 %) | ||||
Total product | 457,312 | 498,166 | (8.2 %) | ||||
Professional services | 37,279 | 35,556 | 4.8 % | ||||
Managed services | 40,910 | 31,963 | 28.0 % | ||||
Total net sales | (5.3 %) | ||||||
Technology Business Net Sales by Customer End Market
| |||||||
Three Months Ended June 30, | |||||||
2024 | 2023 | Change | |||||
(in thousands) | |||||||
Telecom, Media, & Entertainment | (16.8 %) | ||||||
Technology | 109,106 | 73,403 | 48.6 % | ||||
SLED | 92,096 | 109,405 | (15.8 %) | ||||
Healthcare | 75,280 | 86,656 | (13.1 %) | ||||
Financial Services | 49,725 | 65,690 | (24.3 %) | ||||
All other | 91,741 | 89,196 | 2.9 % | ||||
Total net sales | (5.3 %) | ||||||
Financing Business Segment | |||||||
Three Months Ended June 30, | |||||||
2024 | 2023 | Change | |||||
(in thousands) | |||||||
Portfolio earnings | 35.4 % | ||||||
Transactional gains | 1,293 | 1,279 | 1.1 % | ||||
Post-contract earnings | 3,315 | 3,634 | (8.8 %) | ||||
Other | 268 | 504 | (46.8 %) | ||||
Net sales | 9,037 | 8,490 | 6.4 % | ||||
Gross profit | 7,687 | 6,361 | 20.8 % | ||||
Selling, general, and administrative | 3,524 | 3,198 | 10.2 % | ||||
Depreciation and amortization | - | 28 | (100.0 %) | ||||
Interest and financing costs | 585 | 301 | 94.4 % | ||||
Operating expenses | 4,109 | 3,527 | 16.5 % | ||||
Operating income | 26.3 % | ||||||
Adjusted EBITDA | 24.3 % | ||||||
ePlus inc. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP INFORMATION
We included reconciliations below for the following non-GAAP financial measures: (i) Adjusted EBITDA, (ii) Adjusted EBITDA for business segments, (iii) non-GAAP Net Earnings and (iv) non-GAAP Net Earnings per Common Share - Diluted.
We define Adjusted EBITDA as net earnings calculated in accordance with US GAAP, adjusted for the following: interest expense, depreciation and amortization, share-based compensation, acquisition and integration expenses, provision for income taxes, and other income (expense). Adjusted EBITDA presented for the technology business segments and the financing business segment is defined as operating income calculated in accordance with US GAAP, adjusted for interest expense, share-based compensation, acquisition and integration expenses, and depreciation and amortization. We consider the interest on notes payable from our financing business segment and depreciation expense presented within cost of sales, which includes depreciation on assets financed as operating leases, to be operating expenses. As such, they are not included in the amounts added back to net earnings in the Adjusted EBITDA calculation.
Non-GAAP net earnings and non-GAAP net earnings per common share – diluted are based on net earnings calculated in accordance with GAAP, adjusted to exclude other income (expense), share based compensation, and acquisition related amortization expense, and the related tax effects.
We use the above non-GAAP financial measures as supplemental measures of our performance to gain insight into our operating performance and performance trends. We believe that such non-GAAP financial measures provide management and investors a useful measure for period-to-period comparisons of our business and operating results by excluding items that management believes are not reflective of our underlying operating performance. Accordingly, we believe that such non-GAAP financial measures provide useful information to investors and others in understanding and evaluating our operating results.
Our use of non-GAAP information as analytical tools has limitations, and you should not consider them in isolation or as substitutes for analysis of our financial results as reported under GAAP. In addition, other companies, including companies in our industry, might calculate adjusted EBITDA, non-GAAP net earnings and non-GAAP net earnings per common share or similarly titled measures differently, which may reduce their usefulness as comparative measures.
Three Months Ended June 30, | ||||
2024 | 2023 | |||
(in thousands) | ||||
Consolidated | ||||
Net earnings | ||||
Provision for income taxes | 10,203 | 12,675 | ||
Depreciation and amortization [1] | 4,819 | 4,792 | ||
Share based compensation | 2,855 | 2,205 | ||
Interest and financing costs | - | 550 | ||
Other expense, net [2] | (2,073) | (190) | ||
Adjusted EBITDA | ||||
Technology Business Segment | ||||
Operating income | ||||
Depreciation and amortization [1] | 4,819 | 4,764 | ||
Share based compensation | 2,791 | 2,137 | ||
Interest and financing costs | - | 550 | ||
Adjusted EBITDA | ||||
Financing Business Segment | ||||
Operating income | ||||
Depreciation and amortization [1] | - | 28 | ||
Share based compensation | 64 | 68 | ||
Adjusted EBITDA | ||||
Three Months Ended June 30, | |||||
2024 | 2023 | ||||
(in thousands) | |||||
GAAP: Earnings before taxes | |||||
Share based compensation | 2,855 | 2,205 | |||
Acquisition related amortization expense [3] | 3,750 | 3,469 | |||
Other (income) expense [2] | (2,073) | (190) | |||
Non-GAAP: Earnings before provision for income taxes | 42,074 | 52,006 | |||
GAAP: Provision for income taxes | 10,203 | 12,675 | |||
Share based compensation | 799 | 607 | |||
Acquisition related amortization expense [3] | 1,047 | 952 | |||
Other (income) expense, net [2] | (580) | (52) | |||
Tax benefit (expense) on restricted stock | 308 | 137 | |||
Non-GAAP: Provision for income taxes | 11,777 | 14,319 | |||
Non-GAAP: Net earnings | |||||
Three Months Ended June 30, | |||||
2024 | 2023 | ||||
GAAP: Net earnings per common share – diluted | |||||
Share based compensation | 0.08 | 0.06 | |||
Acquisition related amortization expense [3] | 0.10 | 0.09 | |||
Other (income) expense, net [2] | (0.06) | - | |||
Tax benefit (expense) on restricted stock | (0.01) | (0.01) | |||
Total non-GAAP adjustments – net of tax | 0.11 | 0.14 | |||
Non-GAAP: Net earnings per common share – diluted | |||||
[1] Amount consists of depreciation and amortization for assets used internally. |
[2] Legal settlement, interest income and foreign currency transaction gains and losses. |
[3] Amount consists of amortization of intangible assets from acquired businesses. |
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SOURCE EPLUS INC.
FAQ
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