Total Revenue of $45.4 Million Grew 33% Year-Over-Year Signed the Largest Employer Transaction in Company History Large Employer Customer Count Grows to Over 700
Charleston, S.C. – November 4, 2015 – Benefitfocus, Inc. (NASDAQ: BNFT), a leading provider of cloud- based benefits software solutions, today announced its third quarter 2015 financial results.
“Benefitfocus reported record third quarter financial results that exceeded expectations from both a revenue and profitability perspective,” said Shawn Jenkins, Chief Executive Officer of Benefitfocus. “We experienced strong customer activity in both our carrier business and employer business resulting in the best quarter in the company’s history. In addition, once again our software services revenue retention rate was over 95 percent.”
Jenkins added, “We are also pleased to announce we recently signed the largest employer transaction in the company’s history, which serves as a significant testament to the value the Benefitfocus Platform brings to our customers. We remain focused on delivering a best-in-class cloud-based benefits management solution to our customers and we are confident that our expanding product portfolio and industry leadership puts us in an excellent position to capitalize on this multi-billion dollar market opportunity.”
Third Quarter 2015 Financial Highlights
Revenue
- Total revenue was $45.4 million, an increase of 33% compared to the third quarter of 2014.
- Software services revenue was $39.3 million, an increase of 28% compared to the third quarter of 2014.
- Professional services revenue was $6.1 million, an increase of 74% compared to the third quarter of 2014.
- Employer revenue was $22.8 million, an increase of 53% compared to the third quarter of 2014.
- Insurance carrier revenue was $22.6 million, an increase of 17% compared to the third quarter of 2014.
Non-GAAP Net Loss and Adjusted EBITDA
- Non-GAAP net loss was ($13.2) million, compared to ($16.9) million in the third quarter of 2014. Non-GAAP net loss per share was ($0.46), based on 28.8 million basic and diluted weighted average common shares outstanding, compared to ($0.66) for the third quarter of 2014, based on 25.5 million basic and diluted weighted average common shares outstanding.
- Adjusted EBITDA was ($8.8) million, compared to ($13.5) million in the third quarter of 2014.
- 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, 2015 totaled $85.2 million, compared to $88.5 million at the end of the second quarter of 2015.
Third Quarter and Recent Business Highlights
- Ended the quarter with 703 large employer customers, up from 540 at the end of the year ago period and 662 at the end of the second quarter of 2015, and 55 insurance carrier customers, up from 44 at the end of the year ago period and 52 at the end of the second quarter of 2015.
- New employer customer relationships added during the quarter include Flowers Foods, Ubisoft Entertainment, Potash Corporation, Sargento Foods and Steve Madden.
- Announced the launch of the Autumn Software Release, which includes several new platform configurations and feature enhancements as well as the general availability of BENEFITFOCUS® Core Analytics. We expect the latest release to improve the user experience and simplify the open enrollment process for Benefitfocus’ employer and insurance carrier customers.
- Introduced BENEFITFOCUS® ACA Management & Reporting and have received certification as an approved transmitter, allowing us to electronically file required ACA compliance documents with the Internal Revenue Service on behalf of our customers.
- Announced a $46 million, three-and-a-half year, multi-product agreement to provide benefits eligibility and enrollment services to the North Carolina State Health Plan’s more than 500,000 active and retired members. The agreement includes the option to renew for two additional years in one-year increments and as part of the relationship Benefitfocus will deploy BENEFITFOCUS® Marketplace, BENEFITFOCUS® Benefits Service Center and BENEFITFOCUS® ACA Management & Reporting.
Business Outlook
Based on information available as of November 4, 2015, Benefitfocus is providing guidance for the fourth quarter and updating full year 2015 as indicated below.
Fourth Quarter 2015:
- Total revenue is expected to be in the range of $51.2 million to $52.2 million.
- Non-GAAP net loss is expected to be in the range of ($13.7) million to ($13.2) million, or ($0.47) to ($0.46) per share, based on 29.0 million basic and diluted weighted average common shares outstanding.
- Adjusted EBITDA is expected to be in the range of ($8.2) million to ($7.7) million.
Full Year 2015:
- Total revenue is expected to be in the range of $182.0 million to $183.0 million.
- Non-GAAP net loss is expected to be in the range of ($55.0) million to ($54.5) million, or ($1.94) to ($1.93) per share, based on 28.3 million basic and diluted weighted average common shares outstanding.
- Adjusted EBITDA is expected to be in the range of ($35.5) million to ($35.0) million.
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