Top 40 distributor InnerWorkings (asi/168860) released its full second-quarter earnings report, including revenue of $269.2 million in the quarter for a year-over-year increase of 6.7%. The company accumulated $65.1 million in gross profit, which was a 10.4% increase compared to the previous year.
The company revealed new enterprise contracts that clients have signed. The largest is an expansion of an existing relationship with a large food and beverage company for all branded merchandise and printed materials for 16 additional countries throughout Latin America. InnerWorkings said its new enterprise contracts have accounted for more than $60 million in annual gross revenue year-to-date.
The distributor also announced that it has initiated plans to reach new customers and support existing customers in Japan, and has hired a team of executives in the country to begin the process.
“We continue to win more business with new and existing clients on the strength of our global capabilities and our technology,” said CEO Eric D. Belcher. “The expansion of our work with the large food and beverage company demonstrates our commitment to serve as an extension of our clients’ brands, executing comprehensive marketing campaigns all around the world.”
The company accrued a diluted net loss of $2.3 million (4 cents per share) in the second quarter, owing to a $7.3 million increase in earn-out obligations “due to the strong performance of our previously acquired businesses.” Diluted earnings per share (on a non-GAAP basis) were 11 cents in the quarter, a year-over-year increase of 37.5%. Adjusted EBITDA increased 10.3% to $14.8 million.
Year-to-date, InnerWorkings has increased its revenue by 9.3% for a total of $540.3 million. Gross profit for the first half was $127.0 million, an increase of 11.4% compared to the prior-year period. Diluted earnings per share for the year to date increased 66.7% to 15 cents. InnerWorkings reaffirmed its outlook for this year, with expectations of revenue between $1.06 and $1.08 billion and non-GAAP diluted earnings per share between 30-33 cents.
“Our second-quarter financial results reflect continued strong execution of our strategy,” said CFO Jeffrey P. Pritchett. “We are on-track to achieve our financial targets for 2016 with additional profit improvement in the second half of the year, particularly in our International segment where the combination of a more efficient hub structure and strong organic growth is starting to create meaningful operating leverage.”
The distributor released preliminary quarterly results last week but rescheduled its full earnings report until Monday, August 15, for corrected accounting related to its non-executive officer bonuses. InnerWorkings ranks as the 11th-largest distributor in the industry with $147 million in North American promotional product revenue last year.