- Annual Recurring Revenue (ARR)(1) grew to $185.7 million -
total growth of 60.2% and organic growth of 24.8% from $115.9
million reported in Q1 '23
- Quarterly subscription service revenues increased 37.2%
year-over-year from Q1 '23
- PAR acquired Stuzo, a digital engagement software provider
to Convenience and Fuel Retailers (C-Stores), contributing $41.0
million in Q1 '24 ARR
- PAR entered into an agreement to acquire TASK, a global food
service transaction platform offering international unified
commerce solutions, which is expected to close in Q3 ’24 subject to
the satisfaction or waiver of certain conditions.
PAR Technology Corporation (NYSE: PAR) (“PAR Technology” or the
“Company”) today announced its financial results for the first
quarter ended March 31, 2024.
"We kicked off 2024 with momentum and are pleased to report that
organic ARR growth has accelerated to 25% from the prior year first
quarter,” said Savneet Singh, PAR Technology CEO. “The results
evidence the continued demand for our products and our accelerated
win rates. Our results will continue to improve as we consolidate
Stuzo and later TASK and are pleased by the positive feedback we
have received on both acquisitions from new and existing
customers."
Summary of Fiscal 2024 First Quarter
- Revenues were reported at $105.5 million for the three months
ended March 31, 2024, a 5.0% increase compared to $100.4 million
for the same period in 2023.
- Net loss for the three months ended March 31, 2024 was $18.3
million, or $0.62 net loss per share, compared to a net loss of
$15.9 million, or $0.58 net loss per share reported for the same
period in 2023.
- EBITDA(1) for the three months ended March 31, 2024 was a loss
of $17.1 million compared to a loss of $7.0 million for the same
period in 2023.
- Adjusted EBITDA(1) for the three months ended March 31, 2024
was a loss of $7.2 million compared to an Adjusted EBITDA loss of
$8.8 million for the same period in 2023.
- Adjusted net loss(1) for the three months ended March 31, 2024
was $10.8 million, or $0.36 adjusted diluted net loss per share(1),
compared to an adjusted net loss of $12.7 million, or $0.46
adjusted diluted net loss per share, for the same period in
2023.
Reconciliations and descriptions of non-GAAP financial measures
to corresponding GAAP financial measures are included in the tables
at the end of this press release.
_______
(1) See “Key Performance Indicators and Non-GAAP Financial
Measures” below.
Beginning with the first quarter of 2024, the Company's key
performance indicators ARR and Active Sites(1) are presented as two
subscription service product lines: Engagement Cloud (Punchh,
Stuzo, and MENU) and Operator Cloud (Brink POS, PAR Payment
Services, PAR Pay, and Data Central). Our subscription service
product lines were adjusted to align with how management views our
business after the Stuzo Acquisition.
Highlights of Engagement Cloud - First Quarter
2024(1):
- ARR at end of Q1 '24 totaled $107.2 million
- Active Sites as of March 31, 2024 totaled 92.7 thousand
restaurants
Highlights of Operator Cloud - First Quarter 2024(1):
- ARR at end of Q1 '24 totaled $78.5 million
- Active Sites as of March 31, 2024 totaled 27.0 thousand
restaurants
Earnings Conference Call.
There will be a conference call at 9:00 a.m. (Eastern) on May 9,
2024, during which management will discuss the Company's financial
results for the first quarter ended March 31, 2024. The earnings
conference call will be webcast live. To access the webcast, please
visit the PAR Technology Investor Relations website at
www.partech.com/investor-relations/. A recording of the webcast
will be available on this site after the event.
About PAR Technology Corporation.
For more than 40 years, PAR Technology Corporation’s (NYSE
Symbol: PAR) cutting-edge products and services have helped bold
and passionate restaurant brands build lasting guest relationships.
We are the partner enterprise restaurants rely on when they need to
serve amazing moments from open to close, during the most hectic
rush hours, and when the world forces them to adapt and overcome.
More than 70,000 restaurants in more than 110 countries use PAR’s
restaurant point-of-sale, customer loyalty and engagement,
payments, omnichannel digital ordering and delivery, and
back-office software solutions as well as industry leading hardware
and drive-thru offerings. To learn more, visit partech.com or
connect with us on LinkedIn, Twitter, Facebook, and Instagram. The
Company's Environmental, Social, and Governance report can be found
at https://www.partech.com/company/ESG.
_______
(1) See “Key Performance Indicators and Non-GAAP Financial
Measures” below.
Key Performance Indicators and Non-GAAP Financial
Measures.
We monitor certain key performance indicators and non-GAAP
financial measures in the evaluation and management of our
business; certain key performance indicators and non-GAAP financial
measures are provided in this press release because we believe they
are useful in facilitating period-to-period comparisons of our
business performance. Key performance indicators and non-GAAP
financial measures do not reflect and should be viewed
independently of our financial performance determined in accordance
with GAAP. Key performance indicators and non-GAAP financial
measures are not forecasts or indicators of future or expected
results and should not have undue reliance placed upon them by
investors.
Where non-GAAP financial measures are included in this press
release, the most directly comparable GAAP financial measures and a
detailed reconciliation between GAAP and non-GAAP financial
measures is included in this press release under “Non-GAAP
Financial Measures”.
Unless otherwise indicated, financial and operating data
included in this press release is as of March 31, 2024.
As used in this press release,
“Annual Recurring Revenue” or “ARR” is the annualized
revenue from subscription services, including subscription fees for
our SaaS solutions and related software support, managed platform
development services, and transaction-based payment processing
services. We generally calculate ARR by annualizing the monthly
subscription service revenue for all Active Sites as of the last
day of each month for the respective reporting period.
“Active Sites” represent locations active on PAR’s
subscription services as of the last day of the respective fiscal
period.
Trademarks.
“PAR®,” “Brink POS®,” “Punchh®,” “MENUTM,” “Data Central®,”
"Open Commerce®,” "PAR® Pay”, “PAR® Payment Services”, "StuzoTM,"
and other trademarks appearing in this press release belong to
us.
Forward-Looking Statements.
This press release contains forward-looking statements within
the meaning of Section 21E of the Securities Exchange Act of 1934,
as amended, Section 27A of the Securities Act of 1933, as amended,
and the Private Securities Litigation Reform Act of 1995.
Forward-looking statements are not historical in nature, but rather
are predictive of our future operations, financial condition,
financial results, business strategies and prospects.
Forward-looking statements are generally identified by words such
as “believe,” “could”, “continue,” “expect,” “future”, “may,”
“plan,” “should,” “soon to close,” “will,” and similar expressions.
Forward-looking statements are based on management's current
expectations and assumptions that are subject to a variety of risks
and uncertainties, many of which are beyond our control, which
could cause our actual results to differ materially from those
expressed in or implied by forward-looking statements contained in
this press release on our business, financial condition, and
results of operations. Factors, risks, trends and uncertainties
that could cause our actual results to differ materially from those
expressed in or implied by forward-looking statements contained in
this press release include, among others, our ability to
successfully develop or acquire and transition new products and
services and enhance existing products and services to meet
evolving customer needs and respond to emerging technological
trends, including artificial intelligence; unfavorable
macroeconomic conditions, such as recession or slowed economic
growth, fluctuating interest rates, inflation, and changes in
consumer confidence and discretionary spending; the effects, costs
and timing of any acquisitions, divestitures, and capital markets
transactions; our ability to integrate acquisitions into our
operations and the timing and costs associated therewith, including
the acquisition of Stuzo Holdings, LLC; the closing of the
acquisition of TASK Group Holdings Limited and the timing and costs
thereof; the protection of our intellectual property; our ability
to retain and add integration partners, and our success in
acquiring and developing relevant technology for current, new, and
potential customers for our service and product offerings;
geopolitical events, including the effects of the Russia-Ukraine
war, tensions with China and between China and Taiwan, the
Israel-Hamas conflict and other hostilities in the Middle East; the
competitive marketplace for talent and its impact on employee
recruitment and retention; component shortages, inventory
management, and/or manufacturing disruptions and logistics
challenges; risks associated with our international operations; the
effects of global pandemics, such as COVID-19, or other public
health crises; our ability to maintain proper and effective
internal control over financial reporting; changes in estimates and
assumptions we make in connection with the preparation of our
financial statements, in building our business and operational
plans, and in executing our strategies; and the other factors,
risks, trends and uncertainties discussed in our most recent Annual
Report on Form 10-K and other filings with the Securities and
Exchange Commission. Undue reliance should not be placed on the
forward-looking statements in this press release, which are based
on the information available to us on the date hereof. We undertake
no obligation to update or revise any forward-looking statements,
whether as a result of new information, future events, or
otherwise, except as may be required under applicable securities
law.
PAR TECHNOLOGY
CORPORATION
CONDENSED CONSOLIDATED BALANCE
SHEETS
(unaudited, in thousands, except
share amounts)
Assets
March 31, 2024
December 31, 2023
Current assets:
Cash and cash equivalents
$
50,780
$
37,369
Cash held on behalf of customers
12,558
10,170
Short-term investments
21,730
37,194
Accounts receivable – net
69,958
63,382
Inventories
25,054
23,594
Other current assets
14,205
8,890
Total current assets
194,285
180,599
Property, plant and equipment – net
15,356
15,755
Goodwill
619,632
489,654
Intangible assets – net
157,713
94,852
Lease right-of-use assets
3,627
4,083
Other assets
18,300
17,663
Total Assets
$
1,008,913
$
802,606
Liabilities and Shareholders’
Equity
Current liabilities:
Accounts payable
$
39,832
$
29,808
Accrued salaries and benefits
14,264
19,141
Accrued expenses
11,153
10,443
Customers payable
12,558
10,170
Lease liabilities – current portion
1,201
1,366
Customer deposits and deferred service
revenue
14,710
9,304
Total current liabilities
93,718
80,232
Lease liabilities – net of current
portion
2,519
2,819
Long-term debt
378,155
377,647
Deferred service revenue – noncurrent
3,296
4,204
Other long-term liabilities
4,825
4,639
Total liabilities
482,513
469,541
Shareholders’ equity:
Preferred stock, $0.02 par value,
1,000,000 shares authorized, none outstanding
—
—
Common stock, $0.02 par value, 58,000,000
shares authorized, 35,439,115 and 29,386,234 shares issued,
33,973,906 and 28,029,915 outstanding at March 31, 2024 and
December 31, 2023, respectively
703
584
Additional paid in capital
844,210
625,154
Accumulated deficit
(293,244
)
(274,956
)
Accumulated other comprehensive loss
(3,653
)
(939
)
Treasury stock, at cost, 1,465,209 shares
and 1,356,319 shares at March 31, 2024 and December 31, 2023,
respectively
(21,616
)
(16,778
)
Total shareholders’ equity
526,400
333,065
Total Liabilities and Shareholders’
Equity
$
1,008,913
$
802,606
See notes to unaudited interim condensed consolidated financial
statements included in the Company's quarterly report on Form 10-Q
for the quarter ended March 31, 2024 (the “Quarterly Report”).
PAR TECHNOLOGY
CORPORATION
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(unaudited, in thousands, except
per share amounts)
Three Months Ended
March 31,
2024
2023
Revenues, net:
Hardware
$
18,226
$
26,777
Subscription service
38,379
27,965
Professional service
13,468
13,842
Contract
35,424
31,853
Total revenues, net
105,497
100,437
Costs of sales:
Hardware
14,170
22,381
Subscription service
18,594
13,925
Professional service
11,251
11,366
Contract
32,919
29,572
Total cost of sales
76,934
77,244
Gross margin
28,563
23,193
Operating expenses:
Sales and marketing
10,926
9,398
General and administrative
25,608
18,080
Research and development
15,768
14,315
Amortization of identifiable intangible
assets
932
464
Adjustment to contingent consideration
liability
—
(5,200
)
Total operating expenses
53,234
37,057
Operating loss
(24,671
)
(13,864
)
Other income (expense), net
306
(59
)
Interest expense, net
(1,708
)
(1,667
)
Loss before benefit from (provision for)
income taxes
(26,073
)
(15,590
)
Benefit from (provision for) income
taxes
7,785
(315
)
Net loss
$
(18,288
)
$
(15,905
)
Net loss per share (basic and diluted)
$
(0.62
)
$
(0.58
)
Weighted average shares outstanding (basic
and diluted)
29,516
27,344
See notes to unaudited interim condensed consolidated financial
statements included in the Quarterly Report.
PAR TECHNOLOGY
CORPORATION
SUPPLEMENTAL
INFORMATION
(unaudited)
The following table sets forth certain
unaudited supplemental financial data for the five trailing
quarters indicated:
Segment Revenue by Product
Line:
2024
2023
in thousands
Q1
Q4
Q3
Q2
Q1
Restaurant/Retail
Hardware
$
18,226
$
24,400
$
25,824
$
26,390
$
26,777
Subscription service
38,379
32,897
31,363
30,372
27,965
Professional service
13,468
12,603
11,514
12,767
13,842
Total Restaurant/Retail
$
70,073
$
69,900
$
68,701
$
69,529
$
68,584
Government
Mission systems
$
8,247
$
8,174
$
8,808
$
9,218
$
9,383
Intelligence, surveillance, and
reconnaissance solutions
26,756
29,152
29,275
21,510
22,216
Commercial software
421
482
350
287
254
Total Government
$
35,424
$
37,808
$
38,433
$
31,015
$
31,853
Total Revenue
$
105,497
$
107,708
$
107,134
$
100,544
$
100,437
Non-GAAP Financial Measures
The Company reports its financial results in accordance with
GAAP. However, the non-GAAP financial measures set forth in the
reconciliation tables below are provided because management uses
these non-GAAP financial measures in evaluating the results of the
Company's continuing operations and believes this information
provides investors supplemental insight into underlying business
trends and operating results. These non-GAAP financial measures are
not based on any comprehensive set of accounting rules or
principles and should not be considered a substitute for, or
superior to, financial measures calculated in accordance with GAAP.
While we believe that these non-GAAP financial measures provide
useful supplemental information to investors, there are limitations
associated with the use of these non-GAAP financial measures. In
addition, these non-GAAP financial measures should be read in
conjunction with the Company’s unaudited interim condensed
consolidated financial statements prepared in accordance with
GAAP.
Within this press release, the Company makes reference to
EBITDA, adjusted EBITDA, adjusted net loss, and adjusted diluted
net loss per share which are non-GAAP financial measures. EBITDA
represents net loss before income taxes, interest expense, and
depreciation and amortization. Adjusted EBITDA represents EBITDA as
adjusted to exclude certain non-cash and non-recurring charges
including stock-based compensation, transaction expenses, certain
pending litigation expenses, and other non-recurring charges that
may not be indicative of our financial performance; and adjusted
net loss and adjusted diluted net loss per share represents the
exclusion of amortization of acquired intangible assets, certain
non-cash and non-recurring charges, including stock-based
compensation, transaction expenses, certain pending litigation
expenses, and other non-recurring charges that may not be
indicative of our financial performance.
The Company is presenting adjusted EBITDA and adjusted net loss
because we believe that these financial measures provide
supplemental information that may be useful to investors in
evaluating the Company's core business operating results and
comparing such results to other similar companies. Management
believes that adjusted EBITDA and adjusted net loss, when viewed
with the Company's results of operations in accordance with GAAP
and the reconciliations to the most directly comparable GAAP
measures provided in the tables below, provide useful information
about operating performance and period-over-period growth, and
provide additional information that is useful for evaluating the
operating performance of the Company's core business without regard
to potential distortions. Management also believes that adjusted
EBITDA provides investors with insight into factors and trends that
could affect the Company's ongoing cash earnings, from which
capital investments are made and debt is serviced.
The Company's results of operations are impacted by certain
non-cash and non-recurring charges, including stock-based
compensation, transaction related expenditures, and other
non-recurring charges that may not be indicative of the Company’s
financial performance. Management believes that adjusting its net
loss and diluted net loss per share to remove non-recurring charges
provides a useful perspective with respect to the Company's
operating results and provides supplemental information to both
management and investors by removing items that are difficult to
predict and are often unanticipated.
EBITDA, adjusted EBITDA, adjusted net loss, and adjusted diluted
net loss per share are not measures of financial performance or
liquidity under GAAP and, accordingly, should not be considered as
alternatives to net income (loss) or cash flow from operating
activities as indicators of operating performance or liquidity.
Also, these measures may not be comparable to similarly titled
captions of other companies. The tables below provide
reconciliations between net loss and EBITDA, adjusted EBITDA and
adjusted net loss, as well as diluted net loss per share and
adjusted diluted net loss per share.
The following tables set forth certain unaudited supplemental
financial and other data for the periods indicated:
Three Months Ended March 31,
in thousands
2024
2023
Reconciliation of Net Loss to EBITDA and
Adjusted EBITDA
Net loss
$
(18,288
)
$
(15,905
)
(Benefit from) provision for income
taxes
(7,785
)
315
Interest expense, net
1,708
1,667
Depreciation and amortization
7,226
6,933
EBITDA
$
(17,139
)
$
(6,990
)
Stock-based compensation expense (1)
4,410
3,055
Contingent consideration (2)
—
(5,200
)
Transaction costs (3)
4,412
—
Severance (4)
1,434
253
Other (income) expense, net (5)
(306
)
59
Adjusted EBITDA
$
(7,189
)
$
(8,823
)
1
Adjustments reflect stock-based
compensation expense of $4.4 million and $3.1 million for the three
months ended March 31, 2024 and 2023, respectively.
2
Adjustment reflects a non-cash reduction
to the fair market value of the contingent consideration liability
related to the acquisition of MENU Technologies AG in July 2022
(the "MENU Acquisition").
3
Adjustment reflects non-recurring
professional fees incurred in transaction due diligence, including
acquisition costs associated with the Stuzo Acquisition and costs
incurred with the planned acquisition of TASK.
4
Adjustment reflects the severance included
in cost of sales, sales and marketing expense, general and
administrative expense, and research and development expense of
$1.4 million and $0.3 million for the three months ended March 31,
2024 and 2023, respectively.
5
Adjustment reflects foreign currency
transaction gains and losses, rental income and losses, and other
non-recurring expenses recorded in other (income) expense, net, in
the accompanying statements of operations.
in thousands, except per share amounts
Three Months Ended March 31,
Reconciliation of Net Loss/Diluted Net
Loss per Share to Adjusted Net Loss/Adjusted Diluted Net Loss per
Share:
2024
2023
Net loss/diluted net loss per share
$
(18,288
)
$
(0.62
)
$
(15,905
)
$
(0.58
)
Benefit from income taxes (1)
(8,105
)
(0.27
)
—
—
Non-cash interest expense (2)
508
0.02
522
0.02
Acquired intangible assets amortization
(3)
5,167
0.18
4,564
0.17
Stock-based compensation expense (4)
4,410
0.15
3,055
0.11
Contingent consideration (5)
—
—
(5,200
)
(0.19
)
Transaction costs (6)
4,412
0.15
—
—
Severance (7)
1,434
0.05
253
0.01
Other (income) expense, net (8)
(306
)
(0.01
)
59
—
Adjusted net loss/adjusted diluted net
loss per share
$
(10,768
)
$
(0.36
)
$
(12,652
)
$
(0.46
)
Adjusted weighted average common shares
outstanding
29,516
27,344
1
Adjustment reflects a partial release of
our deferred tax asset valuation allowance of $8.1 million
resulting from the Stuzo Acquisition. The income tax effect of the
below adjustments were not tax-effected due to the valuation
allowance on all of our net deferred tax assets.
2
Adjustment reflects non-cash amortization
of issuance costs related to the Company's long-term debt of $0.5
million and $0.5 million for the three months ended March 31, 2024
and 2023, respectively.
3
Adjustment reflects amortization expense
of acquired developed technology included within cost of sales of
$4.3 million and $4.1 million for the three months ended March 31,
2024 and 2023, respectively; and amortization expense of acquired
intangible assets of $0.9 million and $0.5 million for the three
months ended March 31, 2024 and 2023, respectively.
4
Adjustment reflects stock-based
compensation expense of $4.4 million and $3.1 million for the three
months ended March 31, 2024 and 2023, respectively.
5
Adjustment reflects a non-cash reduction
to the fair market value of the contingent consideration liability
related to the MENU Acquisition.
6
Adjustment reflects non-recurring
professional fees incurred in transaction due diligence, including
acquisition costs associated with the Stuzo Acquisition and costs
incurred with the planned acquisition of TASK.
7
Adjustment reflects the severance included
in cost of sales, sales and marketing expense, general and
administrative expense, and research and development expense of
$1.4 million and $0.3 million for the three months ended March 31,
2024 and 2023, respectively.
8
Adjustment reflects foreign currency
transaction gains and losses, rental income and losses, and other
non-recurring expenses recorded in other (income) expense, net, in
the accompanying statements of operations.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240509453163/en/
Christopher R. Byrnes (315) 738-0600 ext. 6226
cbyrnes@partech.com, www.partech.com
PAR Technology (NYSE:PAR)
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