WageWorks Reports Third Quarter 2016 Financial Results
• Total revenue in the third quarter 2016 of $88.9 million
• Third quarter 2016 GAAP net income of $5.9 million or $0.16 per diluted share, Non-GAAP net income of $12.6 million or $0.34 per diluted share
• Third quarter 2016 non-GAAP adjusted EBITDA of $26.5 million
SAN MATEO, Calif., November 9, 2016 (GLOBE NEWSWIRE) -- WageWorks, Inc. (the “Company”) (NYSE: WAGE), a leader in administering Consumer-Directed Benefits, today announced the Company's financial results for its third quarter ended September 30, 2016.
"I am very pleased with our strong third quarter results. We are in the midst of another record setting new sales year driven by increased interest across all of our products from employers of all sizes. The successful transition of the existing participants on the United States Office of Personnel Management’s Federal Flexible Spending Account Program to our platform marks the largest transition of accounts in our history. We continue to enter into new carrier and channel partnerships, which are producing additional opportunities and solid growth. Finally, we are excited about our pending acquisition of ADP’s Consumer Health Spending Account and COBRA businesses and our new ongoing partnership with ADP. We are poised to finish 2016 with strong momentum, as we are clearly executing on our multiple avenues for growth," said Joe Jackson, Chief Executive Officer of WageWorks.
For the third quarter, WageWorks reported total revenue of $88.9 million, compared to $83.2 million for the third quarter of 2015, an increase of 7 percent. Healthcare revenue was $48.5 million, compared to $42.2 million for the third quarter of 2015, an increase of 15 percent. Commuter revenue was $17.6 million, compared to $16.0 million for the third quarter of 2015, an increase of 10 percent. COBRA revenue was $18.7 million, compared to $12.2 million for the third quarter of 2015, an increase of 53 percent. Other revenue was $4.2 million, compared to $12.7 million for the third quarter of 2015.
GAAP operating income was $9.4 million for the third quarter of 2016, compared to GAAP operating income of $12.7 million for the third quarter of 2015. On a non-GAAP basis, third quarter of 2016 operating income was $21.3 million, compared to non-GAAP operating income of $21.9 million for the third quarter of 2015.
GAAP net income was $5.9 million, or $0.16 per diluted share, for the third quarter of 2016, compared to GAAP net income of $7.6 million, or $0.21 per diluted share, for the third quarter of 2015.
On a non-GAAP basis, third quarter of 2016 net income was $12.6 million, or $0.34 per diluted share, compared to non-GAAP net income of $13.0 million, or $0.36 per diluted share, for the third quarter of 2015. Non-GAAP net income for the third quarter of 2015 and 2016 excludes expenses related to stock-based compensation, amortization of acquired intangibles, contingent consideration expense, severance costs related to integration initiatives, costs associated with the planned acquisition of ADP's Consumer Health Spending Account and COBRA businesses, and the related tax impact of these items.
Non-GAAP adjusted EBITDA was $26.5 million for the third quarter of 2016, which remained flat as compared to non-GAAP adjusted EBITDA for the third quarter of 2015.
The reconciliation of the non-GAAP measures to the comparable GAAP measures for the third quarter 2016 and 2015 is detailed in the tables provided in this press release.
As of September 30, 2016, WageWorks had cash and cash equivalents totaling $666.6 million. This compares to cash and cash equivalents totaling $500.9 million as of December 31, 2015.
The Company's Conference Call Information
WageWorks will host a conference call today, November 9, 2016, at 5:00 p.m. ET to discuss the Company’s third quarter ended September 30, 2016 financial results and business outlook.
The live webcast of the conference call can be accessed under “Investor Relations” section of the Company’s website at www.wageworks.com. Those wishing to participate in the live call should dial (844) 778-4142 (toll-free) or (661) 378-9625, and enter pass code 94344136. Following the call, an archived webcast will be available in the “Investor Relations” section of the Company’s website at www.wageworks.com. A telephone replay will be available for one week at (855) 859-2056 (toll-free) or (404) 537-3406 using the pass code 94344136.
Non-GAAP Financial Information
The following information was filed by Wageworks, Inc. (WAGE) on Wednesday, November 9, 2016 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.