Q4 Revenue up 154% to $6.3 Million; Full Year Revenue up 146% to $20.5 Million
ORLANDO, FL (March 29, 2016) – IZEA, Inc. (NASDAQ: IZEA), operators of IZEAx, the premier online marketplace connecting brands and publishers with influential content creators, reported record results for the fourth quarter and year ended December 31, 2015.
Fourth Quarter Financial Highlights vs. the Year-Ago Quarter
- Revenue increased 154% to a record $6.3 million, driven by Sponsored Social revenue up 84% to $4.0 million and Content revenue of $2.3 million.
- Bookings up 167% to a record $7.3 million, with the majority of bookings representing repeat customers.
- New opportunity pipeline, a representation of new client proposals generated within the quarter, increased 55% to $24.8 million.
2015 Financial Highlights
- Revenue increased 146% to a record $20.5 million compared to 2014.
- Organic growth of Sponsored Social revenue increased 92% to a record $12.3 million vs. 2014.
- Content revenue of $8.0 million added in 2015 as a result of the Ebyline acquisition.
- Bookings increased 171% to a record $24.5 million compared to 2014.
- Completed a $12.9 million warrant conversion with 81.5% participation.
- Cash at December 31, 2015 was $11.6 million, receivables totaled $3.9 million and unused credit line of $5.0 million.
2015 Operational Highlights
- Acquired Ebyline, a virtual newsroom platform for freelance journalists and news publishers, adding a network of more than 12,000 professional writers and journalists to the IZEA ecosystem.
- Began sales operations in Canada in September. In March of 2016, IZEA formed IZEA Canada, Inc, a wholly owned subsidiary based in Toronto, to expand the company’s footprint in the region.
- Grew the IZEA staff from 94 to 121 full time team members. Added senior team members in sales and leadership including Chris Staymates, VP of Engineering and Sandra Carbone, General Counsel.
- Secured IZEAx licensing agreements with partners including a global top-10 media company and a multinational advertising agency in the fourth quarter.
- Launched IZEA Score Suite Beta, Content Profiles, IZEA for iOS, and SocialLinks Beta with eBay partnership and technology integration.
- Grew IZEAx network to 629,000 user connections, reaching 3.5 billion aggregate fans and followers.
- Began the Nasdaq uplisting process. The company began trading on Nasdaq in February 2016.
- Signed first individual customer contract in excess of $1 million.
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Management Commentary
“2015 was a transformational year with record topline revenue driven by strong organic growth of Sponsored Social revenue, the acquisition of Ebyline, continued technology innovation and increased efficiency throughout the organization,” said Ted Murphy, IZEA’s Chairman and CEO. “These operational and financial developments strengthened our position as a market leader.”
“Looking ahead, we will continue to invest in growing our sales organization and augmenting our engineering team. In addition, we are actively pursuing accretive acquisition opportunities that can both grow revenue and increase our penetration in niche markets. We remain on track to achieve $100 million in annual bookings by the end of 2018.”
View IZEA Q4 and FY15 Financials (PDF)
2015 Financial Results
Revenue in 2015 increased 146% to $20.5 million compared to $8.3 million in 2014. The increase is primarily attributable to organic growth of Sponsored Social revenue, up 92% to $12.3 million.
Gross profit in 2015 increased 50% to $8.2 million versus $5.5 million in 2014. The increase in gross profit is due to the increase in revenue.
Operating expenses in 2015 were $15.5 million, compared to $10.1 million in 2014. The increase in operating expenses were due to increased investments in sales, marketing and engineering, as well as increased expenses associated with the acquisition of Ebyline.
Net loss in 2015 was $11.3 million or $3.03 per diluted share, as compared to a net income of $3.2 million or $1.00 per diluted share in 2014. The net loss is primarily due to the difference in the change in fair value of derivatives of $11.8 million between 2014 and 2015.
Adjusted EBITDA (a non-GAAP metric defined below) was a loss of $7.1 million compared to adjusted EBITDA loss of $3.7 million in 2014. The change in adjusted EBITDA was primarily due to investments in incremental human capital and marketing, as well as legal fees and settlement costs. Adjusted EBITDA as a percentage of revenue in 2015 improved to negative 35% from negative 45% in 2014.
Cash and cash equivalents at December 31, 2015 totaled $11.6 million compared to $6.5 million at December 31, 2014. The increase in cash was primarily due to warrant conversions, with net proceeds to the company of $12.9 million, completed in the third quarter of 2015.
Conference Call
IZEA will hold a conference call to discuss its fourth quarter and full year results today at 5:00 p.m. Eastern time. Management will host the presentation, followed by a question and answer period.
Date: Tuesday, March 29, 2016
Time: 5:00 p.m. Eastern time (2:00 p.m. Pacific time)
Dial-in number: 1-201-689-8471
Conference ID: 13633328
Webcast: http://public.viavid.com/index.php?id=118768
Please call the conference telephone number five minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Liolios Group at 1-949-574-3860.
A replay of the call will be available after 8:00 p.m. Eastern time on the same day through April 5, 2016.
Replay number: 1-858-384-5517
Replay ID: 13633328
Financial Methodology & Related Disclosures
“EBITDA” is a non-GAAP financial measure within the meaning of Regulation G promulgated by the Securities and Exchange Commission. EBITDA is commonly defined as “earnings before interest, taxes, depreciation and amortization.” We believe that EBITDA provides useful information to investors as it excludes transactions not related to the core cash operating business activities including non-cash transactions.
We believe that excluding these transactions allows investors to meaningfully trend and analyze the performance of our core cash operations. All companies do not calculate EBITDA in the same manner, and EBITDA as presented by IZEA may not be comparable to EBITDA presented by other companies. IZEA defines EBITDA as earnings or loss before interest, taxes, depreciation and amortization, non-cash stock related compensation, gain or loss on asset disposals or impairment and all other income and expense items such as loss on exchanges and changes in fair value of derivatives, if applicable.
