Benefitfocus announces third quarter 2016 financial results
November 7, 2016
Total revenue of $58.0 million grew 28% year-over-year
Employer revenue of $35.4 million grew 55% year-over-year
Benefitfocus, Inc. (NASDAQ:BNFT), a leading provider of cloud-based benefits management solutions, today announced its third quarter 2016 financial results.
“Benefitfocus continued its positive momentum and delivered strong third quarter results with total revenue growing 28% in the quarter,” said Shawn Jenkins, Chief Executive Officer of Benefitfocus. “Our employer revenue grew 55% driven by impressive demand for our platform, and once again, our software revenue retention rate was over 95%.”
Jenkins added, “We are also pleased that we achieved adjusted EBITDA profitability one quarter ahead of plan and continue to make excellent progress towards achieving our long-term goals. Throughout 2016 we have extended our leadership position within the dynamic cloud based benefits administration market as we remain focused on enabling our customers to engage employees, improve plan fit, reduce benefits expense and streamline administration.”
Third Quarter 2016 Financial Highlights
Revenue
- Total revenue was $58.0 million, an increase of 28% compared to the third quarter of 2015.
- Software services revenue was $49.3 million, an increase of 25% compared to the third quarter of 2015.
- Professional services revenue was $8.7 million, an increase of 43% compared to the third quarter of 2015.
- Employer revenue was $35.4 million, an increase of 55% compared to the third quarter of 2015.
- Insurance carrier revenue was $22.7 million, approximately unchanged compared to the third quarter of 2015.
Net Loss
- Net loss was ($8.6) million, compared to ($16.7) million in the third quarter of 2015. Net loss per share was ($0.29), based on 29.7 million basic and diluted weighted average common shares outstanding, compared to ($0.58) for the third quarter of 2015, based on 28.8 million basic and diluted weighted average common shares outstanding.
Non-GAAP Net Loss and Adjusted EBITDA
- Non-GAAP net loss was ($4.1) million, compared to ($13.2) million in the third quarter of 2015. Non-GAAP net loss per share was ($0.14), based on 29.7 million basic and diluted weighted average common shares outstanding, compared to ($0.46) for the third quarter of 2015, based on 28.8 million basic and diluted weighted average common shares outstanding.
- Adjusted EBITDA was $1.1 million, compared to ($8.8) million in the third quarter of 2015.
See important disclosures about non-GAAP measures, and a reconciliation of them to GAAP, below.
Balance Sheet and Cash Flow
- Cash, cash equivalents and marketable securities at September 30, 2016 totaled $55.3 million, compared to $68.0 million at the end of the second quarter of 2016.
Third Quarter and Recent Business Highlights
- Ended the quarter with 827 large employer customers, up from 703 at the end of the year ago period and 803 at the end of the second quarter of 2016.
- Signed 6 new national accounts with more than 10,000 lives during the third quarter.
- Announced major platform upgrades in our Autumn 2016 Software Release. This latest release gives consumers on the BENEFITFOCUS® Platform the ability to complete open enrollment on their mobile device using the BENEFITFOCUS® App or directly through the mobile optimize BENEFITFOCUS® Marketplace.
- Hosted our first Carrier Executive Forum with over 20 SVP level executives from the country’s largest health and voluntary insurance carriers.
- Opportunistically expanded our revolving credit facility from $60 million to $95 million and extended the term to February 2020.
- Appointed Jeffrey Laborde as Chief Financial Officer. Prior to joining Benefitfocus, Laborde served as Chief Financial Officer at Infor, Inc., a leading enterprise resource planning software vendor, and SumTotal Systems, a leading human capital management software provider. Prior to SumTotal, Laborde served as a managing director for Goldman Sachs & Co. in its Technology, Media & Telecom Group.
Business Outlook
Based on information available as of November 3, 2016, Benefitfocus is providing guidance for the fourth quarter and updating full year 2016 as indicated below.
Fourth Quarter 2016:
- Total revenue is expected to be in the range of $62.3 million to $63.3 million.
- Non-GAAP net loss is expected to be in the range of ($4.2) million to ($3.2) million, or ($0.14) to ($0.11) per share, based on 29.8 million basic and diluted weighted average common shares outstanding.
- Adjusted EBITDA is expected to be in the range of $1.5 million to $2.5 million.
Full Year 2016:
- Total revenue is expected to be in the range of $233.0 million to $234.0 million.
- Non-GAAP net loss is expected to be in the range of ($23.4) million to ($22.4) million, or ($0.79) to ($0.76) per share, based on 29.5 million basic and diluted weighted average common shares outstanding.
- Adjusted EBITDA is expected to be in the range of ($2.5) million to ($1.5) million.
See important disclosures about non-GAAP measures, and a reconciliation of them to GAAP below:
Conference Call Details:
In conjunction with this announcement, Benefitfocus will host a conference call today, November 3, 2016 at 5:00 p.m. Eastern Time to discuss the company’s financial results. To access this call, dial (877) 407-9039 (domestic) or (201) 689-8470 (international). A live webcast, as well as the replay, of the conference call will be available on the Investor Relations page of the company’s website at http://investor.benefitfocus.c
About Benefitfocus
Benefitfocus (NASDAQ:BNFT) provides a leading cloud-based benefits management platform that simplifies how organizations and individuals shop for, enroll in, manage and exchange benefits. Every day leading employers, insurance companies and millions of consumers rely on our platform to manage, scale and exchange benefits data seamlessly. In an increasingly complex benefits landscape, we bring order to chaos so our clients and their employees have access to better information, make better decisions and lead better lives. Learn more at www.benefitfocus.com, LinkedIn and Twitter.
