- Liquidity strong after February 2016 asset sale
- Full Year 2015 Adjusted Revenue of $87.6 Million (including $9.9 million of revenue from data storage assets sold in 2016)
- Full Year 2015 Adjusted Gross Profit of $27.5 Million (including $8.2 million of gross profit from data storage assets sold in 2016)
SHREWSBURY, N.J., April 07, 2016 (GLOBE NEWSWIRE) -- InterCloud Systems, Inc. (the "Company" or "InterCloud") (Nasdaq:ICLD), a leading provider of cloud networking orchestration and automation solutions and services, today reported certain financial results for the full year 2015.
Financial Highlights:
- The Company significantly improved liquidity with the sale of data storage assets in February 2016 for approximately $24 Million
- Adjusted Gross Revenue jumped to $87.6 million (including $9.9 million of revenue from the assets sold in February 2016)
Mark Munro, Chairman and CEO of InterCloud, stated, “We are very pleased to report that InterCloud’s revenue for 2015 grew substantially over the same period in 2014. In addition to revenue growth, and equally important, we have increased our gross profit margins from the same period in 2014. After the sale of our data storage assets in February 2016, we have greater liquidity than the Company has ever had, and a business that still generated approximately $77.5 Million in revenue during 2015. The data storage assets accounted for $9.9 million in gross revenues during 2015 for an adjusted total of $87.5 million. Our goal is to take advantage of our cash liquidity to grow our cloud revenues with a focus on Dpod private cloud solutions, our Virtual Network Function (VNF) validation services, and drive sales of our NFVgrid SDN/NFV Orchestration platform. Our exciting new cloud products and services will help us achieve those goals in the near term. We continue to be bullish about our near term and long term outlooks. InterCloud is well positioned competitively with a disruptive portfolio of cloud orchestration products, an industry leading software development team, and an aggressive sales and engineering group. In the past three months we have seen a increase in demand for our cloud portfolio of services in both the enterprise and carrier markets.”
Full Year 2015 Financial Results (unaudited):
Revenue for the year ended December 31, 2015 increased by 5% to $77.7 million, compared to $73.8 million for 2014. This does not include $9.9 million of 2015 revenue from the Company’s online data backup related business which was sold in February 2016. During 2015, the Company had increased revenue from its managed services segment.
Our gross profit increased by 7% to $19.3 million, compared to $18.0 million in 2014. The gross profit percentage increased to 25% for the year ended December 31, 2015, compared to 24% for the comparable period in 2014. This does not include the gross profit of approximately $8.2 million and a gross profit percentage of 83% from the Company’s online data backup related business which was sold in February 2016. The increase in gross profit and gross profit percentage was driven by operations in our managed services segment.
Term Loans and Related Party Notes as of December 31, 2015 (in millions)
| Unsecured: | ||||||
| Related Parties and Private Investor | $ | 19.3 | (1 | ) | ||
| Private Equity Firms - Former Owners of Vaultlogix | 15.6 | (2 | ) | |||
| Other Unsecured | 4.2 | |||||
| Secured: | ||||||
| White Oak Term Loan | 11.8 | (3 | ) | |||
| Senior Secured | 5.1 | (4 | ) | |||
| Total Term Loans and Related Party Payables | $ 55.9* | |||||
(1) Blended interest rate of 5.5%. Maturing between May 2016 and January 2018. $12.5 million is convertible into common shares.
(2) Interest rate of 8.0%. Maturing in October 2017. Convertible at $6.36 per share.
(3) Liabilities available for sale.
(4) Secured by the assets of the Company (excluding Vaultlogix). Interest rate at 12%.
*This balance is net of debt discounts and original issue discounts totaling $6.7 million.
Use of Non-GAAP Financial Measures
This earnings release includes the following Non-GAAP financial measures; Adjusted Revenue and Adjusted Gross Profit.
We define Adjusted Revenue and Adjusted Gross Profit to include 2015 revenue of $9.9 million and gross profit of $8.2 million from a data storage subsidiary that sold all of its assets during February 2016. As a result, the Company will not be recognizing revenue and gross profit from these assets in 2016 and future years.
We believe that Adjusted Revenue and Adjusted Gross Profit are useful because they facilitate operating performance comparisons on period to period basis during 2015. Also please note, these adjustments are not instead or better than GAAP measures.
About InterCloud Systems, Inc.
InterCloud Systems, Inc. is a cloud computing company which provides end-to-end information technology (IT) and next-generation network solutions including Software Defined Networking (SDN) and Network Function Virtualization (NFV) orchestration to the telecommunications service provider (carrier) and corporate enterprise markets through cloud solutions and professional services. Additional information regarding InterCloud may be found on InterCloud's website at www.intercloudsys.com.
Forward Looking Statements
Statements in this press release regarding InterCloud that are not historical facts are forward-looking statements and are subject to risks and uncertainties that could cause actual future events or results to differ materially from such statements. Any such forward-looking statements, including, but not limited to, financial guidance, are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include all statements that do not directly or exclusively relate to historical facts. In some cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “could,” “would,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “projects,” “forecasts,” “predicts,” “potential,” or the negative of those terms, and similar expressions and comparable terminology. These include, but are not limited to, statements relating to future events or our future financial and operating results, plans, objectives, expectations and intentions. Although we believe that the expectations reflected in these forward-looking statements are reasonable, these expectations may not be achieved. Forward-looking statements represent our intentions, plans, expectations, assumptions and beliefs about future events and are subject to known and unknown risks, uncertainties and other factors outside of our control that could cause our actual results, performance or achievement to differ materially from those expressed or implied by these forward-looking statements. In addition to the risks described above, these risks and uncertainties include: our ability to successfully execute our business strategies, including integration of the recent acquisitions of AW Solutions, Inc., Integration Partners-NY Corporation, RentVM, Inc. and VaultLogix, LLC and the future acquisition of other businesses to grow our company; customers’ cancellation on short notice of master service agreements from which we derive a significant portion of our revenue or our failure to renew such master service agreements on favorable terms or at all; our ability to attract and retain key personnel and skilled labor to meet the requirements of our labor-intensive business or labor difficulties which could have an effect on our ability to bid for and successfully complete contracts; our failure to compete effectively in our highly competitive industry could reduce the number of new contracts awarded to us or adversely affect our market share and harm our financial performance; our ability to adopt and master new technologies and adjust certain fixed costs and expenses to adapt to our industry’s and customers’ evolving demands; our history of losses, deficiency in working capital and a stockholders’ deficit and our ability to achieve sustained profitability; material weaknesses in our internal control over financial reporting and our ability to maintain effective controls over financial reporting in the future; our substantial indebtedness could adversely affect our business, financial condition and results of operations and our ability to meet our payment obligations; the impact of new or changed laws, regulations or other industry standards that could adversely affect our ability to conduct our business; and changes in general market, economic and political conditions in the United States and global economies or financial markets, including those resulting from natural or man-made disasters.
These forward-looking statements represent our estimates and assumptions only as of the date of this release and, except as required by law, we undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise after the date of this release. Given these uncertainties, you should not place undue reliance on these forward-looking statements and should consider various factors, including the risks described, among other places, in our most recent Annual Report on Form 10-K and in our Quarterly Reports on Form 10-Q, as well as any amendments thereto, filed with the SEC.