Benefitfocus Announces Fourth Quarter and Full Year 2019 Financial Results

CHARLESTON, S.C., March 03, 2020 (GLOBE NEWSWIRE) — Benefitfocus, Inc. (NASDAQ: BNFT), a leading cloud-based benefits management platform and services provider, today announced its fourth quarter 2019 financial results. Recent highlights include: 
Grew net benefit eligible lives to 17.3 million at the end of the fourth quarter, up from 16.8 million at the end of the prior quarter and 13.3 million at the end of the prior year period.Signed three seven-figure MarketPlace for Carriers transactions.Meaningfully improved GAAP net loss and exceeded high-end of Q4 Adjusted EBITDA guidance by 20%.Announces stock repurchase program for the potential repurchase by the Company of up to $20 million worth of its outstanding common stock.“Benefitfocus delivered solid fourth quarter results. We continue to make meaningful progress on our platform transformation as evidenced by continued strong lives growth and BenefitsPlace traction with both employer and carrier customers,” said Ray August, President and Chief Executive Officer of Benefitfocus.August added, “We remain focused on creating long-term shareholder value. The repurchase program demonstrates the Board of Directors’ and management’s confidence in our business and our commitment to all of our stakeholders.”  Fourth Quarter 2019 Financial HighlightsRevenueTotal revenue was $87.1 million, an increase of 17% compared to the fourth quarter of 2018.Software services was $68.4 million, an increase of 16% compared to the fourth quarter of 2018. Software services is comprised of subscription and platform revenue.Subscription revenue was $49.4 million, an increase of 10% compared to the fourth quarter of 2018.Platform revenue was $19.0 million, an increase of 34% compared to the fourth quarter of 2018.Professional services revenue was $18.7 million, an increase of 19% compared to the fourth quarter of 2018.Net LossGAAP net loss was ($3.8) million, compared to ($13.0) million in the fourth quarter of 2018. GAAP net loss per share was ($0.12), based on 32.8 million basic and diluted weighted average common shares outstanding, compared to ($0.41) for the fourth quarter of 2018, based on 32.0 million basic and diluted weighted average common shares outstanding.Non-GAAP Net Income and Adjusted EBITDANon-GAAP net income was $1.9 million, compared to $4.7 million in the fourth quarter of 2018. Non-GAAP net income per share was $0.06, based on 33.2 million fully diluted weighted average common shares outstanding, compared to $0.14 for the fourth quarter of 2018, based on 33.0 million fully diluted weighted average common shares outstanding.Adjusted EBITDA was $12.5 million, compared to $12.0 million in the fourth quarter of 2018.See important disclosures about non-GAAP measures, and a reconciliation of them to GAAP, below.Full Year 2019 Financial HighlightsRevenueTotal revenue was $295.7 million, an increase of 14% compared to the full year 2018.Software services was $228.7 million, an increase of 13% compared to the full year 2018. Software services is comprised of subscription and platform revenue.Subscription revenue was $195.0 million, an increase of 9% compared to the full year 2018.Platform revenue was $33.7 million, an increase of 47% compared to the full year 2018.Professional services revenue was $67.0 million, an increase of 19% compared to the full year 2018.Net LossGAAP net loss was ($45.5) million, compared to ($52.6) million in the full year 2018. GAAP net loss per share was ($1.40), based on 32.5 million basic and diluted weighted average common shares outstanding, compared to ($1.66) for the full year 2018, based on 31.8 million basic and diluted weighted average common shares outstanding.Non-GAAP Net Loss and Adjusted EBITDANon-GAAP net loss was ($22.3) million, compared to ($18.3) million in the full year 2018. Non-GAAP net loss per share was ($0.69), based on 32.5 million basic and diluted weighted average common shares outstanding, compared to ($0.57) for the full year 2018, based on 31.8 million basic and diluted weighted average common shares outstanding.Adjusted EBITDA was $19.0 million, compared to $10.3 million in the full year 2018.See important disclosures about non-GAAP measures, and a reconciliation of them to GAAP, below.Balance SheetCash and cash equivalents at December 31, 2019 totaled $131.0 million, compared to $130.7 million at the end of the third quarter of 2019. Stock Repurchase ProgramThe Board of Directors has approved a stock repurchase program for the potential repurchase by the Company of up to $20 million worth of its outstanding common stock.Under the stock repurchase program, Benefitfocus is authorized to purchase shares of its common stock through various means, including open market or privately negotiated transactions. The program has no time limit and may be suspended for periods or discontinued at any time by the Board of Directors. Repurchases under the program will be funded by Benefitfocus’ existing cash and cash equivalents or future cash flow. Any shares acquired will be available for general corporate purposes.Updated Business OutlookBased on information available as of March 3, 2020, Benefitfocus is providing guidance for the first quarter and full year 2020 as indicated below. Reflected in the full year guidance is an approximate $16 million reduction of revenue from one large private exchange customer.First Quarter 2020:Total revenue is expected to be in the range of $67.5 million to $69.5 million.Non-GAAP net loss is expected to be in the range of ($10.0) million to ($8.0) million, or ($0.30) to ($0.24) per share, based on 32.8 million basic and diluted weighted average common shares outstanding.Adjusted EBITDA is expected to be in the range of $0.5 million to $2.5 million.Full Year 2020:Total revenue is expected to be in the range of $310.0 million to $320.0 million.Non-GAAP net loss is expected to be in the range of ($23.0) million to ($18.0) million, or ($0.69) to ($0.54) per share, based on 33.2 million basic and diluted weighted average common shares outstanding.Adjusted EBITDA is expected to be in the range of $22.0 million to $27.0 million.Management has not reconciled forward-looking non-GAAP net loss/income and Adjusted EBITDA to their most directly comparable GAAP measure of GAAP net loss. This is because we cannot predict with reasonable certainty the ultimate outcome of the various necessary GAAP components of such reconciliations, including, for example, those related to compensation, acquisition transactions and integration, or others that may arise during the year, without unreasonable effort. These components and other factors could materially impact the amount of the future directly comparable GAAP measures, which may differ significantly from their non-GAAP counterparts. See below for additional important disclosures regarding our non-GAAP financial measures.Conference Call Details:In conjunction with this announcement, Benefitfocus will host a conference call today, March 3, 2020, at 5:00 p.m. Eastern Time to discuss the company’s financial results. To access this call, dial (877) 407-9208 (domestic) or (201) 493-6784 (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.com/. After the conference call, a replay will be available until March 10, 2020, and can be accessed by dialing (844) 512-2921 (domestic) or (412) 317-6671 (international) with passcode 13699438.About BenefitfocusBenefitfocus (NASDAQ: BNFT) unifies the entire U.S. benefits industry on a single technology platform to protect consumers’ health, wealth, property and lifestyle. Our powerful cloud-based software, data-driven insights and thoughtfully-designed services, enable employers, insurance brokers, carriers and suppliers to simplify the complexity of benefits administration and deliver a world-class benefits experience. Learn more at www.benefitfocus.com, LinkedIn and Twitter.Non-GAAP Financial MeasuresThe company uses certain non-GAAP financial measures in this release, including non-GAAP gross profit, operating loss, net loss/income, net loss/income per common share, and adjusted EBITDA. Generally, a non-GAAP financial measure is a numerical measure of a company’s performance or financial position that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with GAAP. Non-GAAP gross profit, operating loss/income, net loss/income and net loss/income per common share exclude stock-based compensation expenses, amortization of acquisition-related intangible assets, transaction and acquisition-related costs expensed, if any, and costs not core to our business, if any. We define adjusted EBITDA as net loss before net interest, taxes, and depreciation and amortization expense, adjusted to eliminate stock-based compensation expense, expense related to the impairment of goodwill and intangible assets, transaction and acquisition-related costs expensed, and costs not core to our business. Please note that other companies might define their non-GAAP financial measures differently than we do.Management presents these non-GAAP financial measures in this release because it considers them to be important supplemental measures of performance. Management uses these non-GAAP financial measures for planning purposes, including analysis of the company’s performance against prior periods, the preparation of operating budgets and to determine appropriate levels of operating and capital investments. Management believes that these non-GAAP financial measures provide additional insight for analysts and investors in evaluating the company’s financial and operational performance. Management also intends to provide these non-GAAP financial measures as part of the company’s future earnings discussions and, therefore, their inclusion should provide consistency in the company’s financial reporting.Non-GAAP financial measures have limitations as an analytical tool. Investors are encouraged to review the reconciliation of the non-GAAP measures to their most directly comparable GAAP measures provided in this release, including in the accompanying tables.Safe Harbor StatementExcept for historical information, all of the statements, expectations, and assumptions contained in this press release are forward-looking statements. Actual results might differ materially from those explicit or implicit in the forward-looking statements. Important factors that could cause actual results to differ materially include: our continuing losses and need to achieve GAAP profitability; fluctuations in our financial results; the immature and volatile market for our products and services; risks related to changing healthcare and other applicable regulations; risks associated with acquisitions; our ability to maintain our culture, recruit and retain qualified personnel and effectively expand our sales force; cyber-security risks; the need to innovate and provide useful products and services; our ability to compete effectively; privacy, security and other risks associated with our business; volatility and uncertainty in the global economy and financial markets; and the other risk factors set forth from time to time in our SEC filings, copies of which are available free of charge within the Investor Relations section of the Benefitfocus website at http://investor.benefitfocus.com/sec-filings or upon request from our Investor Relations Department. Benefitfocus assumes no obligation and does not intend to update these forward-looking statements, except as required by law.Source: Benefitfocus, Inc.


Benefitfocus, Inc.
843-981-8898
pr@benefitfocus.com 
Investor Relations:
Michael Bauer
843-981-8899
michael.bauer@benefitfocus.com