InnerWorkings Announces Full-Year Financial Results

Top 40 distributor InnerWorkings (asi/168860) increased overall company revenue, profit and earnings per share in 2017, according to final audited financial results released this week. The Chicago-based firm also grew year-over-year revenue and profit in the fourth quarter, but earnings per share, EBITDA and net income were down during the three-month period ended Dec. 31 compared to Q4 2016, earnings data showed.

For 2017, InnerWorkings said revenue rose 4% to $1.136 billion. Gross profit for the year was up 6% vs. 2016, jumping to $278.3 million, or 24.5% of gross revenue. Non-GAAP diluted earnings per share for 2017 were $0.41, compared to $0.38 in 2016, while non-GAAP adjusted EBITDA was $62.3 million in 2017, reflecting growth of 5%. Net income tallied $19 million, up from $4.4 million. InnerWorkings did not break out promotional products sales.

For the fourth quarter of 2017, InnerWorkings’ gross revenue reached $301 million -- 11% greater than the comparable period the prior year and a company record, the firm said. At $71.3 million, gross profit was up 4%. Still, profit accounted for less of revenue than the prior year’s Q4 – 23.7% compared to 25.4%, a financial statement showed.

According to the company, non-GAAP adjusted EBITDA was $14.6 million in Q4 2017, compared to $15.7 million in the fourth quarter of 2016. Meanwhile, non-GAAP diluted earnings per share for the fourth quarter were $0.06, compared to $0.12 in the fourth quarter of 2016. Net income for the fourth quarter was $1.5 million, or $0.03 per diluted share, compared to $5 million, or $0.09 per diluted share, in the prior year period.

“Strong top line growth in Q4 was weighed down by unusual expenses that we don’t expect to recur,” Chip Hodgkins, interim chief financial officer, told Counselor. “Given all of the new contracts we signed in 2017 into early this year, we are confident about our forecast for 2018 with continued sales momentum translating to strong adjusted EBITDA and non-GAAP EPS for the year.”

In 2018, InnerWorkings expects to generate annual gross revenue in the range between $1.195 billion and $1.23 billion. Furthermore, InnerWorkings anticipates that non-GAAP adjusted EBITDA will be between $74 million and $77 million this year. Additionally, the company forecasts 2018 non-GAAP diluted earnings per share will be $0.56 to $0.59, representing year-over-year growth of 37% to 44%.

With estimated 2016 North American promotional products revenue of $147 million, InnerWorkings ranked 15th on Counselor’s latest list of the largest distributors in the industry.