TransAct Technologies Incorporated (Nasdaq:TACT) (“TransAct” or the
“Company”) today reported operating results for the fourth quarter and
full year period ended December 31, 2014, as summarized below:
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Summary of 2014 Q4 and Full Year Results
(In millions, except per share and percentage data)
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Three Months Ended December 31,
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Year Ended December 31,
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2014
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2013
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2014
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2013
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Net sales
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$
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12.3
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$
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12.5
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$
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53.1
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$
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60.1
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Gross profit
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$
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4.9
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$
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5.0
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$
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21.7
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$
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25.1
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Gross margin
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39.9
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%
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39.9
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%
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40.9
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%
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41.7
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%
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Operating (loss) income
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$
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(1.2
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)
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$
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1.5
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$
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(0.1
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)
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$
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6.6
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EBITDA(1)
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$
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(0.8
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)
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$
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1.8
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$
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1.3
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$
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8.3
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Net (loss) income
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$
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(0.7
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)
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$
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1.1
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$
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(0.1
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)
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$
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4.9
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Diluted (loss)earnings per share
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$
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(0.08
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)
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$
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0.13
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$
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(0.01
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)
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$
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0.57
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Adjusted operating income(2)
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$
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0.4
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$
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0.9
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$
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1.9
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$
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6.2
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Adjusted EBITDA(1)
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$
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0.8
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$
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1.3
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$
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3.8
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$
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8.4
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Adjusted net income(2)
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$
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0.4
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$
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0.7
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$
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1.3
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$
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4.7
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Adjusted diluted earnings per share(2)
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$
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0.05
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$
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0.08
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$
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0.15
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$
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0.54
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(1)
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EBITDA is defined as net income before net interest expense,
income taxes, depreciation and amortization. A reconciliation of
EBITDA to net income, the most comparable Generally Accepted
Accounting Principles (“GAAP”) financial measure, can be found
attached to this release. Adjusted EBITDA is defined as net income
before net interest expense, income taxes, depreciation,
amortization and adjusted for share-based compensation and the
impact of certain legal fees, employee termination expenses and
accrued contingent consideration as described later in this
release. A reconciliation of Adjusted EBITDA to net income, the
most comparable GAAP financial measure, can be found attached to
this release.
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(2)
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Reconciliations of GAAP financial measures to corresponding
non-GAAP financial measures can be found attached to this release.
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Bart Shuldman, Chairman and Chief Executive Officer of TransAct,
commented, “Fourth quarter results reflect the continued weakness in
overall replacement unit sales for the casino and gaming industry on a
global basis. However, TransAct’s business transformation towards new,
higher-value products that address large and significantly untapped
market opportunities is complete and our focus in fiscal 2015 is on
sales execution. Reflecting this focus, we recently strengthened our
sales and marketing efforts with the appointment of Andrew Newmark as
EVP of Global Sales & Marketing, with direct oversight of the Company’s
sales and marketing efforts across all of our products and services.
Andrew’s appointment adds to our already considerable pool of talent and
more favorably positions TransAct in 2015 to leverage our powerful brand
and product lineup to accelerate our growth across multiple industries
worldwide.
“To address the ongoing challenges of the domestic casino market and the
related impact to our operating results, late in fiscal 2014 we effected
a significant reduction in our overall cost structure, achieving our
goal of removing approximately $1 million of expenses on an annualized
basis. Importantly, we believe this cost reduction action does not
impair the Company’s ability to maintain and even grow our strong
worldwide market share of printer sales for the casino and gaming
industry and we also remain committed to continue investing in the
rollout of our newest products which offer high growth opportunities for
TransAct.
“Our Ithaca® line of food safety terminals remains an attractive
high-growth opportunity for TransAct as we recently secured new business
with a number of well-known global restaurant and food service
operators. We expect these new customer wins and the ongoing acceptance
of our Ithaca 9700 terminal to accelerate market adoption of this
product line this year leading to revenue growth in 2015.
“Our Epicentral® promotional and bonusing print system continues to gain
awareness among global casino operators as performance data from casinos
where it is now enabled clearly demonstrates the strong returns
operators can generate from installing the system. Accordingly, we
expect sales of Epicentral to increase year over year reflecting new
domestic and international installations that are expected to come on
line over the course of 2015.
“Despite the significant decline in oil prices and the resulting
slowdown in oil and gas drilling, the continued success of our Printrex®
980 office printer is expected to drive higher profit contributions from
our Printrex product line in 2015, particularly as we benefit from
growth in our recurring, high margin Printrex-related consumables
business. Finally, later in 2015, we expect to generate initial
contributions from our Responder MP2 all-in-one mobile printing solution
as we enter the large machine-to-machine (M2M) vertical market. Customer
reactions to the Responder MP2, our first printer for the M2M market,
have been very encouraging.”
Mr. Shuldman concluded, “TransAct has completed a significant
re-positioning that leveraged our core competencies and resulted in the
development of new products that address diversified high-growth market
opportunities. We entered 2015 firmly committed to sales execution and
expect that the value proposition of our newest products will drive new
market penetration throughout this year, which in turn will benefit our
financial performance. We are excited about our 2015 prospects and look
forward to benefiting from the hard work undertaken across the
organization over the last few years which has established a foundation
for sustainable, long-term profitable growth.”
Balance Sheet and Capital Return Review
As of December 31, 2014, TransAct had approximately $3.1 million of cash
and cash equivalents and no debt. During the 2014 fourth quarter, the
Company returned approximately $2.5 million of capital to shareholders
through a dividend of $0.08 per share and the repurchase of
approximately 326,000 shares of its common stock at an average price of
approximately $5.55 per share. After giving effect to the repurchase of
approximately 435,000 shares in fiscal 2014, the Company has
approximately $4.9 million remaining under its current share repurchase
authorization. In fiscal 2014, the Company returned approximately $5.2
million of capital to shareholders.
Steve DeMartino, President and Chief Financial Officer of TransAct,
commented, “We believe our 2015 operating results will reflect our
initiatives to diversify our revenue sources while increasing margins
through growing sales of our value-add products that address largely
untapped market opportunities. With a lower overall cost structure
heading into 2015 and our expectation that investment in product
development will decline on a year over year basis, we have the
financial flexibility to support our new product and new market
commercialization efforts while simultaneously continuing our strong
return of capital initiatives.”
Summary of 2014 Fourth Quarter Operating Results
TransAct generated 2014 fourth quarter net sales of $12.3 million
compared with net sales of $12.5 million in the 2013 fourth quarter.
Casino and gaming revenue in the 2014 fourth quarter of $5.0 million was
in line with the 2014 third quarter and compares to $5.7 million in the
2013 fourth quarter, reflecting lower sales of casino printers to
original equipment manufacturers and lower domestic Epicentral revenue.
The 2013 fourth quarter also benefited from a large slot machine
replacement undertaken by a multinational casino operator. Food safety,
point-of-sale (POS) and banking revenue of $2.2 million was essentially
flat on a year over year basis. Sales of the Ithaca® 9700 food safety
terminal more than doubled over the prior-year period to $0.8 million
while revenue from point-of-sale printers declined $0.3 million to $1.2
million as lower sales of legacy POS thermal printers were partially
offset by the benefit from the continued rollout of printers for a new
checkout application at McDonalds. Lottery printer sales for the 2014
fourth increased $0.1 million to $1.6 million. Printrex® revenues were
$0.9 million in the 2014 fourth quarter, essentially flat with the
prior-year period. The Company’s TransAct Services Group recorded net
sales of $2.6 million as 19% year-over-year growth included a $0.1
million increase in Printrex-related consumables as well as a $0.4
million increase in spare parts and service revenue.
Gross margin of 39.9% in the fourth quarter of 2014 is consistent with
the prior-year gross margin and gross profit was $4.9 million compared
to $5.0 million in the year-ago quarter.
Total operating expenses for the 2014 fourth quarter were $6.1 million
compared to $3.5 million in the year-ago quarter. Excluding lawsuit
legal fees, adjustments to the accrual for contingent consideration and
employee termination expenses in both periods, operating expenses for
the fourth quarter increased only $0.3 million to $4.5 million.
Engineering, design and product development expenses declined by $0.1
million to $0.9 million due to staff reductions resulting from the
Company’s actions initiated in the fourth quarter 2014. Selling and
marketing expenses increased $0.2 million to $1.9 million, primarily due
to a shift in timing of the Global Gaming Expo which took place in the
fourth quarter of 2014 compared to the third quarter of 2013. General
and administrative expenses were $2.0 million, a year-over-year increase
of $1.2 million primarily due to (i) a $0.7 million reduction in the
accrued contingent consideration liability related to the Printrex
acquisition recorded in the fourth quarter 2013; (ii) $0.2 million of
employee termination expenses incurred from previously announced cost
reductions undertaken in the 2014 fourth quarter; and, (iii) $0.3
million of higher incentive compensation expenses. TransAct also
incurred $1.4 million of legal fees related to the Avery Dennison
lawsuit compared to $0.1 million in the year-ago quarter.
The Company recorded an operating loss of $1.2 million for the 2014
fourth quarter compared to operating income of $1.5 million in the 2013
fourth quarter. Excluding the impact from the employee termination
expenses, legal fees related to the Avery Dennison lawsuit and an
adjustment to accrued contingent consideration, TransAct generated
adjusted operating income of $0.4 million, or 3.6% of net sales, in the
fourth quarter of 2014 compared with adjusted operating income of $0.9
million, or 7.0% of net sales, in the year-ago period. Net loss in the
2014 fourth quarter was $0.7 million, or $0.08 per diluted share,
compared to net income of $1.1 million, or $0.13 per diluted share, in
the prior-year period. Adjusted net income was $0.4 million, or $0.05
per diluted share, compared to $0.7 million, or $0.08 per diluted share,
in the 2013 fourth quarter.
2014 Fourth Quarter Conference Call and Webcast
TransAct is hosting a conference call and webcast today, March 5, 2015,
beginning at 4:30 p.m. ET. Both the call and the webcast are open to the
general public. The conference call number is 678-825-8259 (domestic or
international). Please call five minutes prior to the presentation to
ensure that you are connected.
Interested parties may also access the conference call live on the
Internet at www.transact-tech.com
(select “Investor Relations” followed by “Events & Presentations”).
Approximately two hours after the call has concluded, an archived
version of the webcast will be available for replay at the same location.
Non-GAAP Financial Measures
TransAct has provided adjusted non-GAAP financial measures because the
Company believes that these amounts are helpful to investors and others
to more accurately assess the ongoing nature of TransAct's core
operations. The adjusted non-GAAP measures exclude the effect in the
applicable periods presented of non-GAAP adjustments contained in the
tables included with this release. These items have been excluded from
adjusted non-GAAP financial measures as management does not believe that
they are representative of underlying trends in the Company's
performance. Their exclusion provides investors and others with
additional information to more readily assess the Company's operating
results. The Company uses the non-GAAP financial measures internally to
focus management on the results of the Company's core business. The
presentation of this additional non-GAAP information is not considered
superior to or a substitute for the financial information prepared in
accordance with GAAP.
Adjusted operating income is defined as operating income adjusted for
the impact of legal fees related to the lawsuit with Avery Dennison
Corporation, employee termination expenses and adjustments to accrued
contingent consideration from the Printrex acquisition.
Adjusted net income is defined as net income adjusted for the
tax-effected impact of legal fees related to the lawsuit with Avery
Dennison Corporation, employee termination expenses and adjustments to
accrued contingent consideration from the Printrex acquisition.
Adjusted diluted earnings per share is defined as adjusted net income
divided by diluted shares outstanding.
About TransAct Technologies Incorporated
TransAct Technologies Incorporated is a leader in developing and
manufacturing market-specific solutions, including printers, terminals,
software and other products for transaction-based and other industries.
These industries include casino and gaming, lottery, food safety,
banking, point-of-sale, hospitality, oil and gas, and medical and
mobile. Each individual market has distinct, critical requirements for
printing and the transaction is not complete until the receipt and/or
ticket is produced. TransAct printers and products are designed from the
ground up based on market-specific requirements and are sold under the
Ithaca®, RESPONDER, Epic, EPICENTRAL® and Printrex® product brands.
TransAct distributes its printers and terminals through OEMs,
value-added resellers, selected distributors, and direct to end-users.
TransAct has over 2.7 million printers and terminals installed around
the world. TransAct is also committed to providing world-class printer
service, spare parts, accessories and printing supplies to its growing
worldwide installed base of products. Through its TransAct Services
Group, TransAct provides a complete range of supplies and consumable
items used in the printing and scanning activities of customers in the
hospitality, banking, retail, gaming, government and oil and gas
exploration markets. Through its webstore, http://www.transactsupplies.com,
and a direct selling team, TransAct addresses the on-line demand for
these products. TransAct is headquartered in Hamden, CT. For more
information, please visit http://www.transact-tech.com
or call 203.859.6800.
Forward-Looking Statements
Certain statements in this press release include forward-looking
statements. Forward-looking statements generally can be identified by
the use of forward-looking terminology, such as "may", "will", "expect",
"intend", "estimate", "anticipate", "believe" or "continue" or the
negative thereof or other similar words. All forward-looking statements
involve risks and uncertainties, including, but are not limited to,
customer acceptance and market share gains, both domestically and
internationally, in the face of substantial competition from competitors
that have broader lines of products and greater financial resources; our
competitors introducing new products into the marketplace; our ability
to successfully develop new products; our dependence on significant
customers; our dependence on significant vendors; dependence on contract
manufacturers for the assembly of a large portion of our products in
Asia; our ability to protect intellectual property; our ability to
recruit and retain quality employees as the Company grows; our
dependence on third parties for sales outside the United States,
including Australia, New Zealand, Europe, Latin America and Asia; the
economic and political conditions in the United States, Australia, New
Zealand, Europe, Latin America and Asia; marketplace acceptance of new
products; risks associated with foreign operations; the availability of
third-party components at reasonable prices; price wars or other
significant pricing pressures affecting the Company's products in the
United States or abroad; risks associated with potential future
acquisitions; our new line of food safety and oil and gas products will
drive increased adoption by customers; the outcome of the lawsuit
between TransAct and Avery Dennison Corporation; and other risk factors
detailed from time to time in TransAct's reports filed with the
Securities and Exchange Commission. Actual results may differ materially
from those discussed in, or implied by, the forward-looking statements.
The forward-looking statements speak only as of the date of this release
and the Company assumes no duty to update them to reflect new, changing
or unanticipated events or circumstances.
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TRANSACT TECHNOLOGIES INCORPORATED
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CONSOLIDATED STATEMENTS OF OPERATIONS
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(Unaudited)
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Three Months Ended
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Year Ended
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(In thousands, except per share amounts)
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December 31,
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December 31,
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|
2014
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2013
|
|
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|
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2014
|
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2013
|
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Net sales
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|
$
|
12,296
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|
|
|
$
|
12,528
|
|
|
|
$
|
53,108
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|
|
|
$
|
60,141
|
|
Cost of sales
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|
|
|
7,385
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|
|
|
|
7,527
|
|
|
|
|
31,397
|
|
|
|
|
35,049
|
|
Gross profit
|
|
|
|
4,911
|
|
|
|
|
5,001
|
|
|
|
|
21,711
|
|
|
|
|
25,092
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
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Engineering, design and product development
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|
|
|
868
|
|
|
|
|
1,017
|
|
|
|
|
4,302
|
|
|
|
|
4,065
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|
Selling and marketing
|
|
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|
1,851
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|
|
|
|
1,644
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|
|
|
|
7,920
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|
|
|
|
7,346
|
|
General and administrative
|
|
|
|
1,967
|
|
|
|
|
769
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|
|
|
|
7,756
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|
|
|
|
6,588
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|
Legal fees associated with lawsuit
|
|
|
|
1,405
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|
|
|
|
78
|
|
|
|
|
1,880
|
|
|
|
|
476
|
|
|
|
|
|
6,091
|
|
|
|
|
3,508
|
|
|
|
|
21,858
|
|
|
|
|
18,475
|
|
Operating income (loss)
|
|
|
|
(1,180
|
)
|
|
|
|
1,493
|
|
|
|
|
(147
|
)
|
|
|
|
6,617
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and other income (expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest, net
|
|
|
|
(11
|
)
|
|
|
|
(14
|
)
|
|
|
|
(49
|
)
|
|
|
|
(23
|
)
|
Other, net
|
|
|
|
(22
|
)
|
|
|
|
(74
|
)
|
|
|
|
(33
|
)
|
|
|
|
(63
|
)
|
|
|
|
|
(33
|
)
|
|
|
|
(88
|
)
|
|
|
|
(82
|
)
|
|
|
|
(86
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) before income taxes
|
|
|
|
(1,213
|
)
|
|
|
|
1,405
|
|
|
|
|
(229
|
)
|
|
|
|
6,531
|
|
Income tax provision (benefit)
|
|
|
|
(536
|
)
|
|
|
|
296
|
|
|
|
|
(171
|
)
|
|
|
|
1,596
|
|
Net income (loss)
|
|
|
|
($677
|
)
|
|
|
$
|
1,109
|
|
|
|
|
(58
|
)
|
|
|
$
|
4,935
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per common share:
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
($0.08
|
)
|
|
|
$
|
0.13
|
|
|
|
|
($0.01
|
)
|
|
|
$
|
0.57
|
|
Diluted
|
|
|
|
($0.08
|
)
|
|
|
$
|
0.13
|
|
|
|
|
($0.01
|
)
|
|
|
$
|
0.57
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares used in per share calculation:
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
8,146
|
|
|
|
|
8,331
|
|
|
|
|
8,307
|
|
|
|
|
8,589
|
|
Diluted
|
|
|
|
8,146
|
|
|
|
|
8,558
|
|
|
|
|
8,307
|
|
|
|
|
8,703
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL INFORMATION – SALES BY SALES UNIT:
|
|
|
|
|
|
|
|
|
|
|
Three months ended
|
|
|
Year ended
|
|
|
|
December 31,
|
|
|
December 31,
|
|
|
|
2014
|
|
|
2013
|
|
|
2014
|
|
|
2013
|
Food safety, banking and POS
|
|
|
$
|
2,164
|
|
|
$
|
2,189
|
|
|
$
|
9,308
|
|
|
$
|
11,296
|
Casino and gaming
|
|
|
|
5,003
|
|
|
|
5,727
|
|
|
|
22,731
|
|
|
|
27,300
|
Lottery
|
|
|
|
1,618
|
|
|
|
1,561
|
|
|
|
4,761
|
|
|
|
4,450
|
Printrex
|
|
|
|
897
|
|
|
|
849
|
|
|
|
3,910
|
|
|
|
4,335
|
TransAct Services Group
|
|
|
|
2,614
|
|
|
|
2,202
|
|
|
|
12,398
|
|
|
|
12,760
|
Total net sales
|
|
|
$
|
12,296
|
|
|
$
|
12,528
|
|
|
$
|
53,108
|
|
|
$
|
60,141
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TRANSACT TECHNOLOGIES INCORPORATED
|
CONSOLIDATED BALANCE SHEETS
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
December 31,
|
|
|
December 31,
|
(In thousands)
|
|
|
|
2014
|
|
|
|
|
2013
|
|
Assets:
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
$
|
3,131
|
|
|
|
$
|
2,936
|
|
Accounts receivable, net
|
|
|
|
9,094
|
|
|
|
|
13,234
|
|
Inventories
|
|
|
|
11,806
|
|
|
|
|
13,509
|
|
Deferred tax assets
|
|
|
|
1,806
|
|
|
|
|
1,655
|
|
Other current assets
|
|
|
|
898
|
|
|
|
|
887
|
|
Total current assets
|
|
|
|
26,735
|
|
|
|
|
32,221
|
|
|
|
|
|
|
|
|
Fixed assets, net
|
|
|
|
2,438
|
|
|
|
|
2,732
|
|
Goodwill
|
|
|
|
2,621
|
|
|
|
|
2,621
|
|
Deferred tax assets
|
|
|
|
1,068
|
|
|
|
|
920
|
|
Intangible assets, net
|
|
|
|
1,341
|
|
|
|
|
1,856
|
|
Other assets
|
|
|
|
26
|
|
|
|
|
58
|
|
|
|
|
|
7,494
|
|
|
|
|
8,187
|
|
Total assets
|
|
|
$
|
34,229
|
|
|
|
$
|
40,408
|
|
|
|
|
|
|
|
|
Liabilities and Shareholders’ Equity:
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
Accounts payable
|
|
|
$
|
2,365
|
|
|
|
$
|
4,749
|
|
Accrued liabilities
|
|
|
|
3,320
|
|
|
|
|
2,215
|
|
Income taxes payable
|
|
|
|
13
|
|
|
|
|
26
|
|
Accrued contingent consideration
|
|
|
|
-
|
|
|
|
|
60
|
|
Deferred revenue
|
|
|
|
313
|
|
|
|
|
300
|
|
Total current liabilities
|
|
|
|
6,011
|
|
|
|
|
7,350
|
|
|
|
|
|
|
|
|
Deferred revenue, net of current portion
|
|
|
|
64
|
|
|
|
|
103
|
|
Deferred rent, net of current portion
|
|
|
|
172
|
|
|
|
|
244
|
|
Other liabilities
|
|
|
|
225
|
|
|
|
|
190
|
|
|
|
|
|
461
|
|
|
|
|
537
|
|
Total liabilities
|
|
|
|
6,472
|
|
|
|
|
7,887
|
|
|
|
|
|
|
|
|
Shareholders’ equity:
|
|
|
|
|
|
|
Common stock
|
|
|
|
111
|
|
|
|
|
111
|
|
Additional paid-in capital
|
|
|
|
28,167
|
|
|
|
|
27,674
|
|
Retained earnings
|
|
|
|
24,712
|
|
|
|
|
27,326
|
|
Accumulated other comprehensive loss, net of tax
|
|
|
|
(72
|
)
|
|
|
|
(63
|
)
|
Treasury stock, at cost
|
|
|
|
(25,161
|
)
|
|
|
|
(22,527
|
)
|
Total shareholders’ equity
|
|
|
|
27,757
|
|
|
|
|
32,521
|
|
Total liabilities and shareholders’ equity
|
|
|
$
|
34,229
|
|
|
|
$
|
40,408
|
|
|
|
|
|
|
|
|
|
|
|
|
TRANSACT TECHNOLOGIES INCORPORATED RECONCILIATION
OF GAAP EARNINGS FINANCIAL MEASURES TO CORRESPONDING
NON-GAAP FINANCIAL MEASURES
(Unaudited, thousands of dollars, except percentages and per
share amounts)
|
|
|
|
|
|
|
|
Three months ended
December 31, 2014
|
|
|
|
Reported
|
|
|
Adjustments(1)
|
|
|
Adjusted
Non-GAAP
|
Operating expenses
|
|
|
$
|
6,091
|
|
|
|
|
($1,624
|
)
|
|
|
$
|
4,467
|
|
% of net sales
|
|
|
|
49.5
|
%
|
|
|
|
|
|
|
36.3
|
%
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss)
|
|
|
|
(1,180
|
)
|
|
|
|
1,624
|
|
|
|
|
444
|
|
% of net sales
|
|
|
|
(9.6
|
%)
|
|
|
|
|
|
|
3.6
|
%
|
|
|
|
|
|
|
|
|
|
|
Income (loss) before income taxes
|
|
|
|
(1,213
|
)
|
|
|
|
1,624
|
|
|
|
|
411
|
|
Income tax provision (benefit)
|
|
|
|
(536
|
)
|
|
|
|
568
|
|
|
|
|
32
|
|
Net income (loss)
|
|
|
|
(677
|
)
|
|
|
|
1,056
|
|
|
|
|
379
|
|
Diluted net income (loss) per share
|
|
|
|
($0.08
|
)
|
|
|
$
|
0.13
|
|
|
|
$
|
0.05
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Adjustment includes (i) $219 of expenses primarily for severance
for employee terminations related to fourth quarter cost reduction
initiatives and (ii) $1,405 of legal and other expenses related to
the lawsuit with Avery Dennison Corporation. Such adjustments were
tax effected using an effective tax rate of 35.0%.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
December 31, 2013
|
|
|
|
Reported
|
|
|
Adjustments (2)
|
|
|
Adjusted
Non-GAAP
|
Operating expenses
|
|
|
$
|
3,508
|
|
|
|
$
|
622
|
|
|
|
$
|
4,130
|
|
% of net sales
|
|
|
|
28.0
|
%
|
|
|
|
|
|
|
33.0
|
%
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
|
|
1,493
|
|
|
|
|
(622
|
)
|
|
|
|
871
|
|
% of net sales
|
|
|
|
11.9
|
%
|
|
|
|
|
|
|
7.0
|
%
|
|
|
|
|
|
|
|
|
|
|
Income before income taxes
|
|
|
|
1,405
|
|
|
|
|
(622
|
)
|
|
|
|
783
|
|
Income tax provision
|
|
|
|
296
|
|
|
|
|
(218
|
)
|
|
|
|
78
|
|
Net income
|
|
|
|
1,109
|
|
|
|
|
(404
|
)
|
|
|
|
705
|
|
Diluted net income per share
|
|
|
$
|
0.13
|
|
|
|
|
($0.05
|
)
|
|
|
$
|
0.08
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2)
|
|
Adjustment includes (i) $700 of income related to an adjustment to
accrued contingent consideration from the Printrex acquisition and
(ii) $78 of legal and other expenses related to the lawsuit with
Avery Dennison Corporation. Such adjustments were tax effected
using an effective tax rate of 35.0%.
|
|
|
|
|
|
|
|
|
|
|
TRANSACT TECHNOLOGIES INCORPORATED RECONCILIATION
OF GAAP EARNINGS FINANCIAL MEASURES TO CORRESPONDING
NON-GAAP FINANCIAL MEASURES
(Unaudited, thousands of dollars, except percentages and per
share amounts)
|
|
|
|
|
|
|
|
Year ended
December 31, 2014
|
|
|
|
Reported
|
|
|
Adjustments(3)
|
|
|
Adjusted
Non-GAAP
|
Operating expenses
|
|
|
$
|
21,858
|
|
|
|
|
($2,039
|
)
|
|
|
$
|
19,819
|
|
% of net sales
|
|
|
|
41.2
|
%
|
|
|
|
|
|
|
37.3
|
%
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss)
|
|
|
|
(147
|
)
|
|
|
|
2,039
|
|
|
|
|
1,892
|
|
% of net sales
|
|
|
|
(0.3
|
%)
|
|
|
|
|
|
|
3.6
|
%
|
|
|
|
|
|
|
|
|
|
|
Income (loss) before income taxes
|
|
|
|
(229
|
)
|
|
|
|
2,039
|
|
|
|
|
1,810
|
|
Income tax provision (benefit)
|
|
|
|
(171
|
)
|
|
|
|
714
|
|
|
|
|
543
|
|
Net income (loss)
|
|
|
|
(58
|
)
|
|
|
|
1,325
|
|
|
|
|
1,267
|
|
Diluted net income (loss) per share
|
|
|
|
($0.01
|
)
|
|
|
$
|
0.16
|
|
|
|
$
|
0.15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(3)
|
|
Adjustment includes (i) $60 of income related to an adjustment to
accrued contingent consideration from the Printrex acquisition,
(ii) $219 of expenses primarily for severance for employee
terminations related to fourth quarter cost reduction initiatives
and (iii) $1,880 of legal and other expenses related to the
lawsuit with Avery Dennison Corporation. Such adjustments were tax
effected using an effective tax rate of 35.0%.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended
December 31, 2013
|
|
|
|
Reported
|
|
|
Adjustments (4)
|
|
|
Adjusted
Non-GAAP
|
Operating expenses
|
|
|
$
|
18,475
|
|
|
|
$
|
424
|
|
|
|
$
|
18,899
|
|
% of net sales
|
|
|
|
30.7
|
%
|
|
|
|
|
|
|
31.4
|
%
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
|
|
6,617
|
|
|
|
|
(424
|
)
|
|
|
|
6,193
|
|
% of net sales
|
|
|
|
11.0
|
%
|
|
|
|
|
|
|
10.3
|
%
|
|
|
|
|
|
|
|
|
|
|
Income before income taxes
|
|
|
|
6,531
|
|
|
|
|
(424
|
)
|
|
|
|
6,107
|
|
Income tax provision
|
|
|
|
1,596
|
|
|
|
|
(148
|
)
|
|
|
|
1,448
|
|
Net income
|
|
|
|
4,935
|
|
|
|
|
(276
|
)
|
|
|
|
4,659
|
|
Diluted net income per share
|
|
|
$
|
0.57
|
|
|
|
|
($0.03
|
)
|
|
|
$
|
0.54
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(4)
|
|
Adjustment includes (i) $900 of income related to an adjustment to
accrued contingent consideration from the Printrex acquisition and
(ii) $476 of legal and other expenses related to the lawsuit with
Avery Dennison Corporation. Such adjustments were tax effected
using an effective tax rate of 35.0%.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TRANSACT TECHNOLOGIES INCORPORATED RECONCILIATION
OF NET INCOME TO ADJUSTED EBITDA
NON-GAAP FINANCIAL MEASURES
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Year Ended
|
(In thousands)
|
|
|
December 31,
|
|
|
December 31,
|
|
|
|
|
2014
|
|
|
|
|
2013
|
|
|
|
|
2014
|
|
|
|
|
2013
|
|
Net income (loss)
|
|
|
|
($677
|
)
|
|
|
$
|
1,109
|
|
|
|
|
($58
|
)
|
|
|
$
|
4,935
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest (income) expense, net
|
|
|
|
11
|
|
|
|
|
14
|
|
|
|
|
49
|
|
|
|
|
23
|
|
Income tax provision (benefit)
|
|
|
|
(536
|
)
|
|
|
|
296
|
|
|
|
|
(171
|
)
|
|
|
|
1,596
|
|
Depreciation and amortization
|
|
|
|
361
|
|
|
|
|
427
|
|
|
|
|
1,445
|
|
|
|
|
1,741
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
|
|
(841
|
)
|
|
|
|
1,846
|
|
|
|
|
1,265
|
|
|
|
|
8,295
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share-based compensation expense
|
|
|
|
64
|
|
|
|
|
124
|
|
|
|
|
506
|
|
|
|
|
521
|
|
Legal fees associated with lawsuit
|
|
|
|
1,405
|
|
|
|
|
78
|
|
|
|
|
1,880
|
|
|
|
|
476
|
|
Employee termination expense
|
|
|
|
219
|
|
|
|
|
-
|
|
|
|
|
219
|
|
|
|
|
-
|
|
Adjustment to accrued contingent consideration
|
|
|
|
-
|
|
|
|
|
(700
|
)
|
|
|
|
(60
|
)
|
|
|
|
(900
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
|
|
|
$
|
847
|
|
|
|
$
|
1,348
|
|
|
|
$
|
3,810
|
|
|
|
$
|
8,392
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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