Benefitfocus announces second quarter 2016 financial results

 

Benefitfocus, Inc. (NASDAQ:BNFT), a leading provider of cloud-based benefits management software, today announced its second quarter 2016 financial results.

“Benefitfocus continued to strengthen its market leadership position and delivered a strong second quarter, with revenue and profitability that exceeded the high-end of our guidance for the twelfth consecutive quarter,” said Shawn Jenkins, Chief Executive Officer of Benefitfocus. “Strong demand drove total revenue growth of 36% in the second quarter and once again, our software revenue retention rate was over 95%.”

Jenkins added, “We remain on track to achieve Q4 adjusted EBITDA profitability and are making significant progress towards achieving our long-term goals.  This was exemplified in the second quarter by our strong revenue growth and nearly 8 times reduction in adjusted EBITDA loss over the year-ago period.”

Second Quarter 2016 Financial Highlights

Revenue

• Total revenue was $57.9 million, an increase of 36% compared to the second quarter of 2015.
• Software services revenue was $51.0 million, an increase of 34% compared to the second quarter of 2015.
• Professional services revenue was $6.9 million, an increase of 50% compared to the second quarter of 2015.
• Employer revenue was $36.3 million, an increase of 75% compared to the second quarter of 2015.
• Insurance carrier revenue was $21.6 million, a decrease of 1% compared to the second quarter of 2015.

GAAP Net Loss

• GAAP net loss was ($11.0) million, compared to ($18.3) million in the second quarter of 2015. GAAP net loss per share was ($0.37), based on 29.5 million basic and diluted weighted average common shares outstanding, compared to ($0.64) for the second quarter of 2015, based on 28.6 million basic and diluted weighted average common shares outstanding.

Non-GAAP Net Loss and Adjusted EBITDA

• Non-GAAP net loss was ($6.5) million, compared to ($15.3) million in the second quarter of 2015. Non-GAAP net loss per share was ($0.22), based on 29.5 million basic and diluted weighted average common shares outstanding, compared to ($0.53) for the second quarter of 2015, based on 28.6 million basic and diluted weighted average common shares outstanding.
• Adjusted EBITDA was ($1.4) million, compared to ($10.7) million in the second quarter of 2015.

See important disclosures about non-GAAP measures, and a reconciliation of such measures to GAAP, below.

Balance Sheet

• Total available liquidity at the end of the quarter was $88.8 million, which is comprised of cash, cash equivalents, marketable securities and availability under the company’s line of credit.

Second Quarter and Recent Business Highlights

• Ended the second quarter with 803 large employer customers, up from 662 at the end of the year-ago period and 741 at the end of the first quarter of 2016.
• Signed 6 new national accounts with more than 10,000 lives during the second quarter, as well as a multi-year, multi-product transaction with a 120,000 employee customer in early July.
• Announced Benefitstore for Part Time Employees that will be released for open enrollment 2016.  This is an incremental revenue opportunity that will enable our large customers to provide part time employers a benefit package that includes Life and Disability Insurance, ID Theft Protection, Legal Assistance, and access to Telemedicine services.
• Introduced One Place 365 Idea Community as part of the Summer 2016 software release. The One Place 365 Idea Community is a collaboration platform that enables customers to crowd-source their ideas and share new product concepts online, building upon the company’s existing platforms for gathering customer feedback.
• Passed a significant milestone in June with the successful delivery of forms 1094 and 1095 to the IRS on behalf of all our BENEFITFOCUS® ACA Management & Reporting customers.

Business Outlook

Based on information available as of August 3, 2016, Benefitfocus is providing guidance for the third quarter and full year 2016 as indicated below.

Third Quarter 2016:

• Total revenue is expected to be in the range of $57.0 million to $58.0 million.
• Non-GAAP net loss is expected to be in the range of ($10.0) million to ($9.5) million, or ($0.34) to ($0.32) per share, based on 29.6 million basic and diluted weighted average common shares outstanding.
• Adjusted EBITDA is expected to be in the range of ($4.0) million to ($3.5) million.

Full Year 2016:

• Total revenue is expected to be in the range of $233.0 million to $236.0 million.
• Non-GAAP net loss is expected to be in the range of ($29.0) million to ($27.0) million, or ($0.98) to ($0.91) 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 ($7.5) million to ($5.5) million.

See important disclosures about non-GAAP measures, and a reconciliation of such measures to GAAP, below.

 

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.