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FRAMINGHAM, MA – September 29, 2014 – Rand Worldwide, Inc. (OTCBB: RWWI), a global provider of technology solutions to organizations with engineering design and information technology requirements, announces its financial results for its year ended June 30, 2014.
For its fiscal year ended June 30, 2014, Rand Worldwide, Inc. reported total revenues of $91.6 million, as compared with $82.5 million for its prior fiscal year. The Company’s overall gross margin was 49.4%, a slight decrease from the 50.5% reported for fiscal 2013, resulting in income from continuing operations of $9.1 million, or $0.16 per fully diluted share. For the year ended June 30, 2013, Rand Worldwide reported income from continuing operations of $2.5 million, or $0.04 per fully diluted share.
Included in the full year results is a $4.5 million non-recurring reduction of income tax expense resulting from the recognition of a portion of the value of the Company’s Canadian net operating loss carryforwards that are available to offset future income taxes. In accordance with generally accepted accounting principles, the Company reduced a valuation allowance on its books in its fourth quarter to reflect the future value of certain loss carryforwards due to the continued profitability of its Canadian operations.
Lawrence Rychlak, president and chief financial officer, commented, “This past fiscal year was a very successful one for us in many respects. We saw growth in all revenue categories and particularly our product sales which increased over 14% from the prior year. These strong revenues coupled with continued management of the operations resulted in a healthy bottom line which positions us well for the future.”
“I am very pleased with the operating results for this fiscal year and with the overall health of all of our business lines,” said Marc Dulude, chief executive officer. “Rand Worldwide is well equipped and prepared to take on the next set of challenges and opportunities that come before us.”
Rand Worldwide, Inc. and Subsidiaries
Consolidated Statements of Operations
Years ended
June 30, 2014 June 30, 2013
Revenues:
Product sales
$ 47,822,000 $ 41,869,000
Service revenue
23,480,000 21,764,000
Commission revenue
20,294,000 18,870,000
Total revenue
91,596,000 82,503,000
Cost of revenue:
Cost of product sales
30,547,000 26,282,000
Cost of service revenue
15,763,000 14,540,000
Total cost of revenue
46,310,000 40,822,000
Gross margin
45,286,000 41,681,000
Other operating expenses:
Selling, general and administrative
35,902,000 35,111,000
Impairment of goodwill and intangible assets
1,000,000 —
Change in the value of contingent consideration
(1,089,000 ) —
Depreciation and amortization
1,915,000 1,891,000
Total operating expenses
37,728,000 37,002,000
Operating income
7,558,000 4,679,000
Other expense:
Interest expense
158,000 304,000
Currency exchange losses
70,000 110,000
Other expense
(4,000 ) 62,000
224,000 476,000
Income from continuing operations before income taxes
7,334,000 4,203,000
Income tax (benefit) expense
(1,723,000 ) 1,691,000
Income from continuing operations
9,057,000 2,512,000
Loss from discontinued operations, net of tax
— (241,000 )
Loss on sale of discontinued operations, net of tax
(463,000 ) (370,000 )
Net income
8,594,000 1,901,000
Preferred stock dividends
(109,000 ) (109,000 )
Net income available to common stockholders
$ 8,485,000 $ 1,792,000
Earnings (loss) per common share attributable to common shareholders – basic:
Income from continuing operations per common share
$ 0.17 $ 0.04
Loss from discontinued operations per common share
(0.01 ) (0.01 )
Earnings per common share attributable to common shareholders – basic
$ 0.16 $ 0.03
Earnings (loss) per common share attributable to common shareholders – diluted:
Income from continuing operations per common share
$ 0.16 $ 0.04
Loss from discontinued operations per common share
(0.01 ) (0.01 )
Earnings per common share attributable to common shareholders – diluted
$ 0.15 $ 0.03
Shares used for computing income per common share:
Weighted average shares used in computation—basic
54,210,555 53,951,438
Weighted average shares used in computation—diluted
57,039,061 55,102,436
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