Jagged Peak, Inc. Announces Financial Results for Fiscal Year 2011

Share Article

Net revenues increased more than 37% to $30.5 million.

Think eCommerce ... Think Jagged Peak

Jagged Peak, Inc. (OTC BB: JGPK), a leading provider of enterprise-class eCommerce solutions and supply chain services, today announced financial results for the fiscal year ended December 30, 2011.

Net revenues for the 52-week period increased more than 37% to approximately $30.5 million, compared to about $22.2 million for the 53-week period in 2010. The increase in revenue primarily resulted from continued expansion of services to existing customers, the addition of new customers and increased sales from our Canadian operations. Cost of revenue―which consist primarily of labor, software amortization, technology, facilities, postage, freight and packing supplies―increased by about 46% to approximately $24.8 million compared to approximately $17.0 million for 2010. This increase resulted primarily from costs associated with greater order/transaction volume, increased orders flowing through the company’s North America distribution network and the growth of the Canadian operation. General and administrative expenses increased by about 25% to approximately $5.7 million compared with approximately $4.5 million last year. This was primarily related to increased sales and marketing costs related to a new sales program, recruiting and travel expenses and costs related to the implementation of the new warehouse management system. The company reported a loss of approximately $250.0 thousand, or $0.02 per weighted average share, compared with a net income of approximately $113.1 thousand or $0.01 per weighted average share for 2010 as a result of the previously mentioned items.

Chief Executive Officer of Jagged Peak, Inc., Paul Demirdjian, commented, “2011 was an exciting year for Jagged Peak! As we focused our message and sales efforts on eCommerce software and solutions, we again achieved significant revenue growth. We see great acceptance in the market for our eCommerce solutions and services, including having our EDGE™ eCommerce platform recognized in 2011 in the prestigious eCommerce Magic Quadrant by technology research and advisory firm Gartner, Inc. Gartner’s Magic Quadrants are an important industry barometer, and affirmation that we’re on the right track in terms of our product roadmap and our client delivery model. By partnering with Jagged Peak, our clients are able to maximize their direct-to-customer sales channel potential, which provides the benefit of reduced costs and increased revenue. We fully expect to continue our momentum in 2012 and beyond.”

According to Chief Financial Officer of Jagged Peak, Inc., Albert Narvades, “We have expanded our distribution network to a total of 18 locations in North America and expect to continue expansion in 2012. With the refinancing of our debt and the continued growth of our TotalCommerce™ solution, we have created a strong foundation to continue growing the company’s revenues. Our growth to this point has not required significant capital investment or a significantly larger administrative structure. As we move into 2012, we expect to actively market the benefits of our services. In the past five years, the company has experienced steady and structured growth. We will now capitalize on this foundation to expand our customer base and improve profitability.”

EBITDA for the 52-week period ended December 30, 2011 was approximately $0.5 million compared to approximately $1.0 million in the comparable period of the prior year. The decrease in the EBITDA directly relates to the increase in general and administrative expenses as previously noted. The company defines EBITDA as earnings before interest, taxes, depreciation and amortization costs. The company believes EBITDA is a useful measure of operating performance before the impact of investing and financing transactions, making comparisons between companies’ earnings power more meaningful and providing consistent comparisons of the company’s performance. The following reconciliation is provided for consistent comparisons of year-over-year EBITDA.
...................................................................................For the period ended
............................................................December 3, 2011................December 31, 2010

Net profit (loss) as reported...............$ (250,000).................................$ 113,100
Income tax expense (benefit)................(112,200).......................................83,700
Interest expense.......................................418,300......................................473,900
Depreciation and amortization...............467,200......................................376,200

EBITDA....................................................$ 523,300................................$ 1,046,900

Use of GAAP and Non-GAAP Measures
In addition to results presented in accordance with generally accepted accounting principles (“GAAP”), the company has included in this report “EBITDA,” with EBITDA being defined by the company as earnings before interest, taxes, depreciation and amortization. For each non-GAAP financial measure, the company has presented the most directly comparable GAAP financial measure and has reconciled the non-GAAP financial measure with such comparable GAAP financial measure.

These non-GAAP financial measures provide useful information to investors to assist in understanding the underlying operational performance of the company. Specifically, EBITDA is a useful measure of operating performance before the impact of investing and financing transactions, making comparisons between companies’ earnings power more meaningful and providing consistent period-over-period comparisons of the company’s performance. In addition, the company uses this non-GAAP financial measure internally to measure its on-going business performance and in reports to bankers to permit monitoring of the company’s ability to pay outstanding liabilities.

Forward-Looking Statements
This earnings release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve risks and uncertainties. Factors that could cause actual results to differ materially from those predicted in any such forward-looking statement include our ability to continue to lower our costs, our timely development and customers’ acceptance of our products, including acceptance by key customers, pricing pressures, rapid technological changes in the industry, growth of the market, increased competition, our ability to attract and retain qualified personnel, adverse changes in general economic conditions in the U.S. and internationally, risks associated with foreign operations and political and economic uncertainties associated with current world events. These and other risks are detailed from time to time in the Jagged Peak, Inc. periodic reports filed with the Securities and Exchange Commission, including, but not limited to, its report on Form 10-K for its fiscal year ended December 30, 2011.

About Jagged Peak
Jagged Peak’s technology and supply chain services provides enable retailers, manufacturers, distributors and consumer brand companies to quickly and cost-effectively establish and operate a direct online business. The cornerstone of Jagged Peak’s solutions is the EDGE eCommerce platform. It is a fully web-based order management system that provides real-time order visibility throughout the entire order life cycle across multiple business units, distribution channels and trading partners. Jagged Peak’s blue chip client roster includes numerous global consumer brand companies. For more information, please visit http://www.jaggedpeak.com.

Share article on social media or email:

View article via:

Pdf Print

Contact Author

Albert Narvades, CFO - Investor Relations Contact

Marjorie Bulone, Media Contact
Visit website