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Wayside Technology Group Reports Second Quarter 2020 Results
Net Sales up 12% to $56.6 Million Despite Industry Challenges from COVID-19
Working Capital Improvements Drive Cash Position up 3x to $45.0 Million
Eatontown, NJ – August 12, 2020 – Wayside Technology Group, Inc. (NASDAQ: WSTG) (“Wayside” or the “Company”), an IT channel company providing innovative sales and distribution solutions, is reporting financial results for the second quarter ended June 30, 2020.
The second quarter includes the results of operations from the acquisition of Interwork Technologies Inc., effective May 1, 2020. More information is available in the Company’s quarterly report filed on form 10-Q with the Securities and Exchange Commission.
Second Quarter 2020 Summary vs. Same Year-Ago Quarter (excl. balance sheet items)
|●||Net sales increased 12% to $56.6 million compared to $50.7 million.|
|●||Gross profit was $7.1 million compared to $7.8 million.|
|●||Net income was $0.6 million or $0.13 per share, compared to $1.9 million or $0.41 per share.|
|●||Adjusted EBITDA (a non-GAAP financial measure defined below) was $2.1 million compared to $2.7 million.|
|●||At June 30, 2020, cash and cash equivalents increased significantly to $45.0 million compared to $15.0 million at December 31, 2019. The Company remains debt-free.|
“We continued to serve as a vital partner to our vendors during the second quarter despite the many COVID-19 related uncertainties we all faced,” said Dale Foster, CEO of Wayside. “During the quarter, we experienced softness in volumes with a few key vendors, which impacted margins and profitability. However, we still managed to increase sales by 12%, driven by both our acquisition of Interwork as well as driving growth with other vendors in our line card, which speaks to the investments we have made over the past 18 months to diversify our revenue streams.
“During the quarter, we also implemented an ‘early pay discount program’ with one of our large customers that has materially improved our working capital position, leaving us at quarter end with a cash balance of $45 million. This was completed in exchange for a concession of approximately $0.3 million of gross profit per quarter going forward. We believe this exchange significantly enhances our position to continue investing in our business to accelerate growth and profitability over the long term.
“Despite COVID-19 disruptions across our industry, we continued to make progress in improving our market position as a sales-driven organization. Our integration of Interwork is progressing very well and even exceeding expectations in certain areas, and we are well underway in leveraging their vendor relationships to grow our network.
“Further, in May we rebranded our core Lifeboat Distribution business to Climb Channel Solutions, which better reflects our focus on emerging data center, cloud and security products, all of which are
The following information was filed by Wayside Technology Group, Inc. (WSTG) on Wednesday, August 12, 2020 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.
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