Shows Revenue Growth and Channel Expansion
COLUMBUS, OH –(August 14, 2017) –Intellinetics, Inc. (OTCQB: INLX), a cloud-based document solutions provider, announced financial results for the second quarter and six months ended June 30, 2017.
Q2 Key Metrics
- Sixth consecutive quarter of revenue growth
- Software as a Service Revenue increased 28%
- Total Revenue increased 16%
- Net Loss improvement of 26% and Adjusted EBITDA improvement of 66%
- A result of operational improvements leveraging sales growth
Revenues for the three months ended June 30, 2017 were $737,354, as compared with $636,749 for the same period in 2016, representing an increase of $100,605, or 16%. Sales of Software as a Service (SaaS) growth was 28%, with new customers partially offset by a price reduction for a key channel partner. Overall, gross margins were 71% and 68% for the three months ended June 30, 2017 and 2016, respectively.
Net loss was $(299,282) and $(401,964) for the three months ended June 30, 2017 and 2016, or $(0.02) and $(0.02) per share, respectively, representing a decrease of $102,682, or 26%. Total decrease in net loss was attributable to the increase in gross profit for the three months ended June 30, 2017. Adjusted EBITDA loss for the quarter was $(121,724), compared with a loss of $(351,926) for the same period last year, representing a 65% improvement.
Revenues for the six months ended June 30, 2017 were $1,447,748 as compared with $1,240,140 for the same period in 2016. Intellinetics reported a net loss of $(747,990) and $(937,730) for the six months ended June 30, 2017 and 2016, respectively, representing a decrease (improvement) of $189,740. Net loss per share for the six months ended June 30, 2017 and 2016 was ($0.04) and ($0.06), respectively.
Matthew L. Chretien, President and CEO of Intellinetics, stated, “In Q2 we continued our revenue growth momentum and achieved a business plan milestone by adding revenue from our recently announced OEM / Embedded sales channel partner, Field2Base. We expect that this partnership and others in this segment established in Q2 will accelerate in the coming quarters and continue to build upon our SaaS foundation, as well as other Software and Professional Services revenue drivers.
“We are focusing on positioning SaaS revenue to outpace one-time Software and Professional Services revenue longer term. SaaS revenue has several advantages, including: 1) It generally continues over several years, and 2) Payment for the entire contract is typically paid up front while revenue is recognized monthly over the term of the agreement. Until SaaS is the bulk of our revenue, while we anticipate continued growth, revenues will be lumpy because one-time Software and Professional Services revenue is not consistent. More diversity and strength in recurring revenue generation is the key,” concluded Chretien.
Second Quarter Highlights
- Deepened our relationship with technology-based partner Field2Base, which was announced in Q1 and began generating revenue in Q2, including expansion revenue from our initial customer. Additional revenue is expected in Q3 and beyond, from new customers and further expansion in the initial customer.
- Focused on additional OEM / Embedded channel partners, targeting select technology-based solution providers. This new OEM / Embedded channel segment:
- Embeds the sale of IntelliCloud into existing products focused on a captive installation base,
- Creates leads for a separate / standalone process, and
- Results in new offerings that we are also selling through our imaging channel.
IntelliCloudTM –Powered by the Intel® NUC
IntelliCloud™ is a cloud-based document management platform that is optimized for the vast SMB market segment and business teams within large enterprises who are stuck with paper in business-critical processes. Thousands and thousands of people at any given moment depend upon IntelliCloud to perform their work. IntelliCloud, which is strategically packaged with Intel® technology, provides Law Enforcement Grade security and compliance tools and is supported by a growing network of market-leading reseller partners. Resellers often attach IntelliCloud to the software, hardware, and/or services they already sell, without the sales or technical complexity of other less effective options in the market.
About Intellinetics, Inc.
Intellinetics, Inc. is a Columbus, Ohio-based ECM software company. Its flagship IntelliCloudTM platform is ideal for embedded work teams in businesses of any size stuck in document-centric processes that are not optimized. IntelliCloud offers a painless way to merge those documents into digital workflows, increasing service levels, compliance and customer satisfaction while decreasing costs and risk. Intellinetics collaborated with Intel® to create its IntelliCloud Channel Program that enables resellers to easily embed IntelliCloud into the copiers, productivity software and services they already provide. IntelliCloud provides dealers a “deploy once, use many” innovation where one IntelliCloud customer sale/activation creates endless possibilities to add other software applications that deliver more value and increase revenue. For additional information, please visit: www.intellinetics.com.
Statements in this press release which are not purely historical, including statements regarding future business and new revenues associated with any channel partner, distribution partner, reseller, or other relationship; Intellinetics’ future revenues and growth in Q3 2017 and beyond; market penetration; execution of Intellinetics’ business plan; and other intentions, beliefs, expectations, representations, projections, plans or strategies regarding future growth, financial results, and other future events are forward-looking statements. The forward-looking statements involve risks and uncertainties including, but not limited to, the risks associated with the effect of changing economic conditions, trends in the products markets, variations in Intellinetics’ cash flow or adequacy of capital resources, market acceptance risks, the success of Intellinetics’ channel partners and distribution partners, technical development risks, and other risks and uncertainties discussed in Intellinetics’ most recent annual report on Form 10-K and subsequently filed Form 10-Qs and Form 8-Ks. Intellinetics cautions investors not to place undue reliance on the forward-looking statements contained in this press release. Intellinetics disclaims any obligation and does not undertake to update or revise any forward-looking statements in this press release. Expanded and historical information is made available to the public by Intellinetics on its website at www.intellinetics.com or at www.sec.gov.
Terri MacInnis, VP of Investor Relations
Bibicoff + MacInnis, Inc.