ALJ Regional Holdings Inc. (fka ALJJ)

[Enterprising Investor]

ALJ Regional Holdings Reports Second Quarter Results (5/15/15)

NEW YORK, May 15, 2015 /PRNewswire/ -- ALJ Regional Holdings, Inc. (OTC Markets: ALJJ) announced results for its second quarter ended March 31, 2015.

ALJ acquired Faneuil, Inc. ("Faneuil") in October 2013 and Floors-N-More, LLC, dba Carpets N' More ("Carpets") in April 2014. Our financial statements reflect the full operations of Faneuil from October 18, 2013 through March 31, 2015 and Carpets from April 1, 2014 through March 31, 2015.

Investment Highlights:

•ALJ recognized consolidated revenue of $53.2 million for the three months ended March 31, 2015 compared to $49.9 million for the three months ended December 31, 2014 and $36.4 million for the three months ended March 31, 2014.

•ALJ recognized EBITDA of $4.4 million for the three months ended March 31, 2015 compared to $4.9 million for the three months ended December 31, 2014 and $5.5 million for the three months ended March 31, 2014.

•Faneuil recognized revenue of $42.4 million for the three months ended March 31, 2015 compared to $40.7 million for the three months ended December 31, 2014 and $36.4 million for the three months ended March 31, 2014.

•Faneuil recognized EBITDA of $4.3 million for the three months ended March 31, 2015 compared to $5.4 million for the three months ended December 31, 2014 and $5.6 million for the three months ended March 31, 2014.

•ALJ recognized consolidated revenue of $103.1 million for the six months ended March 31, 2015 compared to $62.2 million for the six months ended March 31, 2014.

•ALJ recognized EBITDA of $9.3 million for the six months ended March 31, 2015 compared to $8.0 million for the six months ended March 31, 2014.

•Faneuil recognized revenue of $83.1 million for the six months ended March 31, 2015 compared to $62.2 million for the six months ended March 31, 2014.

•Faneuil recognized EBITDA of $9.7 million for the six months ended March 31, 2015 compared to $8.3 million for the six months ended March 31, 2014.

•Faneuil estimates its revenue to be in the range of $31.4 million to $34.9 million for the three months ending June 30, 2015 compared to actual revenue of $35.0 million for the three months ended June 30, 2014.

•ALJ entered into a $1.5 million senior credit facility with M&T Bank and used $1.0 million of the facility and $533,000 of cash on hand to pay off the existing term loan in full.

•Faneuil increased its revolving senior credit facility with M&T Bank from $5.0 million to $10.0 million.

Jess Ravich, ALJ's Executive Chairman said, "We continue to stay focused on growing our revenue base for both Faneuil and Carpets. We are very happy with the added verticals at both companies. Such vertical expansion reduces our exposure to any particular industry or counter-party."

Anna Van Buren, Faneuil's CEO said, "We are excited to see our continued diversification and growth within the healthcare sector. We have experienced, and will continue to experience, seasonality in the healthcare sector as enrollments require higher staffing levels at the beginning of each calendar year. However, we have invested resources into expanding into other vertical markets and expect to see returns later in the year." She went on to say, "We experienced higher margins last year due to one-time implementation revenues that were not repeated this year."

Non-GAAP Financial Measures:

In this release, ALJ presents certain adjusted financial measures that are not calculated according to generally accepted accounting principles in the United States ("GAAP"). These non-GAAP financial measures are designed to complement the GAAP financial information presented in this release because management believes they present information regarding ALJ that management believes is useful to investors. The non-GAAP financial measures presented should not be considered in isolation from or as a substitute for the comparable GAAP financial measure.

EBITDA represents net income before interest income and expense, income taxes, non-cash stock based compensation, depreciation and amortization. ALJ presents EBITDA because it believes it is frequently used by securities analysts, investors and other interested parties in the evaluation of ALJ. EBITDA measures are not calculated in the same manner by all companies and, accordingly, may not be an appropriate measure for comparison. A reconciliation of ALJ EBITDA to operating income, the most directly comparable GAAP measure, can be obtained by subtracting depreciation and amortization and non-cash stock based compensation from ALJ EBITDA. A reconciliation of Faneuil EBITDA to operating income, the most directly comparable GAAP measure, can be obtained by subtracting depreciation and amortization and non-cash stock based compensation from Faneuil EBITDA. All of this information is included in ALJ's quarterly report for the quarter ended March 31, 2015.

About ALJ Regional Holdings, Inc.

ALJ Regional Holdings, Inc. is the parent company of Faneuil, Inc., a leading provider of business process outsourcing and co-sourced services to both commercial and government entities in the healthcare, utility, toll and transportation industries; and Floors-N-More, LLC, dba Carpets N' More, one of the largest floor covering retailers in Las Vegas and a provider of multiple finishing products for commercial, retail and home builder markets including all types of flooring, countertops, cabinets, window coverings and garage/closet organizers, with 5 retail locations.

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