EnerNOC Reports Record Results for Third Quarter of 2013 – Company Posts Record Revenue of $278.5 Million, Up 56% Year-Over-Year – – Company Posts Record Adjusted EBITDA of $123.2 Million, Up 78% Year-Over-Year – – Company Raises Midpoint of Guidance for Revenue, Adjusted EBITDA and Earnings – BOSTON, Nov. 7, 2013 (GLOBE NEWSWIRE) --EnerNOC, Inc. (Nasdaq:ENOC), a leading provider of energy intelligence software, today announced record results for the third quarter of 2013 and raised the midpoint of its full year guidance. Summary Financial Results In Thousands, Except Per Q3 2013 Q3 2012 % Change Q3 YTD Q3 YTD % Change Share Amounts 2013 2012 Revenue $278,473 $177,947 56.5% $347,476 $235,670 47.4% Net Income GAAP $106,857 $60,348 77.1% $41,969 $3,499 1,099.5% Non-GAAP^1 $112,381 $65,497 71.6% $59,061 $18,955 211.6% Diluted Net Income Per Share GAAP $3.70 $2.21 67.4% $1.47 $0.13 1,030.8% Non-GAAP^1 $3.90 $2.40 62.5% $2.06 $0.70 194.3% Cash Flow From $21,295 $8,625 146.9% $33,459 $12,866 160.1% Operations Free Cash Flow^1 $15,556 $6,007 159.0% $534 $1,114 (52.1%) Adjusted EBITDA^1 $123,235 $69,080 78.4% $82,341 $32,345 154.6% ^1Refer to "Statement of Use of Non-GAAP Measures" for non-GAAP definitions and refer to the financial schedules attached to this press release for a reconciliation of non-GAAP financial measures to the most directly comparable GAAP financial measures. "We are excited to be reporting record third quarter results highlighted by strong growth in both revenues and earnings," said Tim Healy, Chairman and Chief Executive Officer of EnerNOC, Inc. "Based on the overall strength of the business and the confidence we have in our outlook, we are pleased to be raising the midpoint of our full year guidance. We are focused on delivering the best year in the Company's history and extending our leadership position in the rapidly growing market for energy intelligence software and solutions." Recent Operational Highlights *The Company launched new products and features that strengthen the connection between energy usage and spend. This includes an interactive payments feature in the Company's DemandSMART application that enables customers to view their demand response payments, providing visibility into the financial impact of an organization's participation in demand response initiatives. The Company also introduced new utility bill management functionality that aggregates the enterprise customer's true spend on energy. *The Company entered into a new agreement with Eastern Australian distribution operator Ausgrid to administer its demand response program. EnerNOC will administer the Ausgrid Dynamic Peak Rebate Program to Ausgrid's commercial, institutional, and industrial customers. This is an expansion of a pilot program originally launched in 2012. *The Company was issued a patent by the United States Patent and Trademark Office. Patent No. 8,457,803, entitled "Apparatus and Method for Demand Coordination Network," focuses on the technology, tools, and processes the Company uses to dynamically and reliably deploy demand response resources where and when they are needed. *The Company achieved its most recent certification by the OpenADR Alliance for compliance with the OpenADR 2.0 Profile B specification, making EnerNOC one of the first companies in the OpenADR Alliance to announce a 2.0B-compliant product. Profile B is designed for high-end embedded devices that support a wide range of demand response services and markets, and this certification confirms EnerNOC's ability to seamlessly integrate with demand response programs in new and existing markets that require standards compliance. Company Issues Fourth Quarter Guidance and Raises Midpoint of Full Year Guidance The Company today issued guidance for the fourth quarter of 2013 and raised the midpoint of its full year guidance. The Company's guidance is based on the current indications for its business, which may change at any time. A reconciliation of the Company's expected GAAP to non-GAAP business outlook, and a statement as to the use of non-GAAP financial measures, is included at the end of this press release. Guidance for Quarter Ending December 31, 2013 Estimate Issued on November 7, 2013 Total Revenue (in millions) $32.5-$37.5 GAAP Loss Per Share ($0.75)-($0.67) Non-GAAP Loss Per Share^1 ($0.54)-($0.46) Adjusted EBITDA^1 (in millions) ($12.3)-($9.3) Guidance for Year Ending December 31, 2013 Estimate Issued on August 6, 2013 Issued on November 7, 2013 Total Revenue (in $360.0-$400.0 $380.0-$385.0 millions) GAAP Earnings Per Diluted $0.60-$0.85 $0.72-$0.80 Share Non-GAAP Earnings Per $1.39-$1.71 $1.51-$1.59 Diluted Share^1 Adjusted EBITDA^1 (in $62.0-$77.0 $70.0-$73.0 millions) ^1Refer to "Statement of Use of Non-GAAP Measures" for non-GAAP definitions and refer to the financial schedules attached to this press release for a reconciliation of non-GAAP financial measures to the most directly comparable GAAP financial measures. Company to Host Live Conference Call and Webcast The Company's management team plans to host a live conference call and webcast at 5:00 p.m. eastern time today to discuss the financial results as well as management's outlook for the business.The conference call may be accessed in the United States by dialing 1.800.230.1085 and using access code "ENOC".The conference call may be accessed outside of the United States by dialing +1.612.234.9959 and using access code "ENOC".The conference call will be simultaneously webcast on the Company's investor relations website, which can be accessed at http://investor.enernoc.com.A replay of the conference call will be available approximately two hours after the call by dialing 1.800.475.6701 or +1.320.365.3844 and using access code 304424 or by accessing the webcast replay on the Company's investor relations website. About EnerNOC EnerNOC (Nasdaq:ENOC) is a leading provider of energy intelligence software and related solutions. EnerNOC unlocks the full value of energy management for utility and commercial, institutional, and industrial (C&I) customers by delivering a comprehensive suite of demand-side management services that reduce real-time demand for electricity, increase energy efficiency, improve energy supply transparency in competitive markets, and mitigate emissions. EnerNOC's Utility Solutions™ offerings, which include both implementation and consulting services, are helping hundreds of utilities and grid operators worldwide meet their demand-side management objectives. EnerNOC serves thousands of commercial, institutional, and industrial customers worldwide through a suite of energy management applications including: DemandSMART™, comprehensive demand response; EfficiencySMART™, continuous energy savings; and SupplySMART™, energy price and risk management. EnerNOC's Network Operations Center (NOC) offers 24x7x365 customer support. For more information, visit www.enernoc.com. The EnerNOC, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=5804 EnerNOC, Inc. Safe Harbor Statement Statements in this press release regarding management's future expectations, beliefs, intentions, goals, strategies, plans or prospects, including, without limitation, statements relating to the Company's future financial performance on both a GAAP and non-GAAP basis and the future growth and success of the Company's energy intelligence software and related solutions, may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. Forward-looking statements can be identified by terminology such as "anticipate," "believe," "could," "could increase the likelihood," "estimate," "expect," "intend," "is planned," "may," "should," "will," "will enable," "would be expected," "look forward," "may provide," "would" or similar terms, variations of such terms or the negative of those terms. Such forward-looking statements involve known and unknown risks, uncertainties and other factors including those risks, uncertainties and factors referred to under the section "Risk Factors" in EnerNOC's most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q, as well as other documents that may be filed by EnerNOC from time to time with the Securities and Exchange Commission. As a result of such risks, uncertainties and factors, the Company's actual results may differ materially from any future results, performance or achievements discussed in or implied by the forward-looking statements contained herein. EnerNOC is providing the information in this press release as of this date and assumes no obligations to update the information included in this press release or revise any forward-looking statements, whether as a result of new information, future events or otherwise. EnerNOC, Inc. Condensed Consolidated Statements of Income (in thousands, except share and per share data) (unaudited) Three Months Ended Nine Months Ended September 30, September 30, 2013 2012 2013 2012 Revenues: DemandSMART $267,479 $169,658 $318,553 213,586 EfficiencySMART, SupplySMART and 10,994 8,289 28,923 22,084 other Total revenues 278,473 177,947 347,476 235,670 Cost of revenues 126,072 82,947 172,142 126,437 Gross profit 152,401 95,000 175,334 109,233 Operating expenses: Selling and marketing 15,761 13,424 50,444 41,342 General and administrative 19,746 18,351 60,872 52,880 Research and development 4,535 3,914 14,125 11,536 Total operating expenses 40,042 35,689 125,441 105,758 Income from operations 112,359 59,311 49,893 3,475 Other income (expense), net 233 619 (884) 1,316 Interest expense (451) (300) (1,212) (1,197) Income before income tax 112,141 59,630 47,797 3,594 (Provision for) benefit from (5,284) 718 (5,828) (95) income tax Net income $106,857 $60,348 $41,969 $3,499 Net income per common share Basic $3.83 $2.26 $1.52 $0.13 Diluted $3.70 $2.21 $1.47 $0.13 Weighted average number of common shares used in computing net income per common share Basic 27,920,409 26,653,252 27,693,054 26,470,634 Diluted 28,843,010 27,325,949 28,616,552 27,069,569 EnerNOC, Inc. Condensed Consolidated Balance Sheets (in thousands, except par value and share data) (unaudited) September 30, 2013 December 31, 2012 ASSETS Current assets: Cash and cash equivalents $111,230 $115,041 Trade accounts receivable, net 61,518 35,208 Unbilled revenue 118,583 45,269 Capitalized incremental direct customer 3,513 10,226 contract costs Prepaid expenses, deposits and other 8,726 6,945 current assets Total current assets 303,570 212,689 Property and equipment, net 50,062 32,592 Goodwill and intangible assets, net 97,742 105,129 Capitalized incremental direct customer 2,213 3,929 contract costs Deposits and other assets 1,483 826 Total assets $455,070 $355,165 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $1,709 $3,976 Accrued capacity payments 96,507 49,258 Accrued payroll and related expenses 11,675 13,044 Accrued expenses and other current 13,653 9,663 liabilities Deferred revenue 17,235 20,063 Total current liabilities 140,779 96,004 Deferred tax liability 6,379 4,222 Deferred revenue 7,563 11,837 Other liabilities 9,991 3,080 Total long-term liabilities 23,933 19,139 Stockholders' equity: Common stock, $0.001 par value; 50,000,000 shares authorized, 30,013,822 and 29,019,923 shares issued and outstanding at September 30, 2013 and December 31, 2012, 30 29 respectively Additional paid-in capital 353,490 344,137 Accumulated other comprehensive loss (1,689) (702) Accumulated deficit (61,473) (103,442) Total stockholders' equity 290,358 240,022 Total liabilities and stockholders' $455,070 $355,165 equity EnerNOC, Inc. Condensed Consolidated Statements of Cash Flow Data (in thousands) (unaudited) Three Months Ended Nine Months Ended September 30, September 30, 2013 2012 2013 2012 Cash provided by operating activities $21,295 $8,625 $33,459 $12,866 Cash (used in) provided by investing (8,450) 5,009 (33,803) (7,147) activities Cash (used in) provided by financing (3,423) 76 (2,632) 141 activities Effects of exchange rate changes on cash 232 44 (835) 11 and cash equivalents Net change in cash and cash equivalents $9,654 $13,754 $(3,811) $5,871 Cash and cash equivalents at beginning of $101,576 $79,414 $115,041 $87,297 period Cash and cash equivalents at end of $111,230 $93,168 $111,230 $93,168 period EnerNOC, Inc. Statement on Use of Non-GAAP Financial Measures To supplement the Company's consolidated financial statements presented on a GAAP basis, the Company discloses certain non-GAAP measures that exclude certain amounts, including non-GAAP net income (loss), non-GAAP net income (loss) per share, adjusted EBITDA and free cash flow. These non-GAAP measures are not in accordance with, or an alternative for, generally accepted accounting principles in the United States. The GAAP measure most comparable to non-GAAP net income (loss) is GAAP net income (loss); the GAAP measure most comparable to non-GAAP net income (loss) per share is GAAP net income (loss) per share; the GAAP measure most comparable to adjusted EBITDA is GAAP net income; and the GAAP measure most comparable to free cash flow is cash flows provided by operating activities. Reconciliations of each of these non-GAAP financial measures to the corresponding GAAP measures are included below. Management uses these non-GAAP measures when evaluating the Company's operating performance and for internal planning and forecasting purposes. Management believes that such measures help indicate underlying trends in the business, are important in comparing current results with prior period results, and are useful to investors and financial analysts in assessing the Company's operating performance. For example, management considers non-GAAP net income (loss) to be an important indicator of the overall performance because it eliminates the effects of events that are either not part of the Company's core operations or are non-cash compensation expenses. In addition, management considers adjusted EBITDA to be an important indicator of the Company's operational strength and performance of the business and a good measure of the Company's historical operating trend. Moreover, management considers free cash flow to be an indicator of the Company's operating trend and performance of the business. The following is an explanation of the non-GAAP measures that management utilizes, including the adjustments that management excluded as part of the non-GAAP measures for the three and nine month periods ended September 30, 2013 and 2012, respectively, as well as reasons for excluding these individual items: *Management defines non-GAAP net income (loss) as net income (loss) before expenses related to stock-based compensation and amortization expenses related to acquisition-related intangible assets, net of related tax effects. *Management defines adjusted EBITDA as net income (loss), excluding depreciation, amortization, stock-based compensation, interest, income taxes and other income (expense). Adjusted EBITDA eliminates items that are either not part of the Company's core operations or do not require a cash outlay, such as stock-based compensation. Adjusted EBITDA also excludes depreciation and amortization expense, which is based on management's estimate of the useful life of tangible and intangible assets. These estimates could vary from actual performance of the asset, are based on historical cost incurred to build out the Company's deployed network and may not be indicative of current or future capital expenditures. *Management defines free cash flow as net cash provided by (used in) operating activities less capital expenditures. Management defines capital expenditures as purchases of property and equipment, which includes capitalization of internal-use software development costs. Non-GAAP net income (loss), non-GAAP net income (loss) per share, adjusted EBITDA and free cash flow may have limitations as analytical tools. The non-GAAP financial information presented here should be considered in conjunction with, and not as a substitute for or superior to the financial information presented in accordance with GAAP and should not be considered measures of the Company's liquidity. There are significant limitations associated with the use of non-GAAP financial measures. Further, these measures may differ from the non-GAAP information, even where similarly titled, used by other companies and therefore should not be used to compare the Company's performance to that of other companies. EnerNOC, Inc. Reconciliation Of Non-GAAP Measures To Nearest GAAP Measures Reconciliation of Non-GAAP Net Income And Net Income Per Share (in thousands, except share and per share data) (Unaudited) Three Months Ended September 30, 2013 2012 GAAP net income $106,857 $60,348 ADD: Stock-based compensation (1) 3,821 3,341 ADD: Amortization expense of acquired 1,703 1,808 intangible assets (1) Non-GAAP net income $112,381 $65,497 GAAP net income per diluted share $3.70 $2.21 ADD: Stock-based compensation (1) 0.14 0.12 ADD: Amortization expense of acquired 0.06 0.07 intangible assets (1) Non-GAAP net income per diluted share $3.90 $2.40 Weighted average number of diluted common 28,843,010 27,325,949 shares outstanding Nine Months Ended September 30, 2013 2012 GAAP net income $41,969 $3,499 ADD: Stock-based compensation (1) 11,832 10,018 ADD: Amortization expense of acquired 5,260 5,438 intangible assets (1) Non-GAAP net income $59,061 $18,955 GAAP net income per diluted share $1.47 $0.13 ADD: Stock-based compensation (1) 0.41 0.37 ADD: Amortization expense of acquired 0.18 0.20 intangible assets (1) Non-GAAP net income per diluted share $2.06 $0.70 Weighted average number of diluted common 28,616,552 27,069,569 shares outstanding (1) The non-GAAP adjustments would have no impact on the provision for income taxes recorded during the three or nine months ended September 30, 2013 and 2012, respectively. EnerNOC, Inc. Reconciliation of Adjusted EBITDA (in thousands) (unaudited) Three Months Ended September Nine Months Ended September 30, 30, 2013 2012 2013 2012 Net income $106,857 $60,348 $41,969 $3,499 Add back: Depreciation and 7,055 6,428 20,616 18,852 amortization Stock-based 3,821 3,341 11,832 10,018 compensation expense Other (income) (233) (619) 884 (1,316) expense, net Interest expense 451 300 1,212 1,197 Provision for (benefit from) income 5,284 (718) 5,828 95 tax Adjusted EBITDA $123,235 $69,080 $82,341 $32,345 EnerNOC, Inc. Reconciliation of Free Cash Flow (in thousands) (unaudited) Three Months Ended September Nine Months Ended September 30, 30, 2013 2012 2013 2012 Net cash provided by $21,295 8,625 $33,459 $12,866 operating activities Subtract: Purchases of property (5,739) (2,618) (32,925) (11,752) and equipment Free cash flow $15,556 $ 6,007 $534 $1,114 Non-GAAP Financial Guidance This press release also includes estimates of future non-GAAP net income (loss) and net income (loss) per diluted share.A reconciliation of these amounts to the nearest expected GAAP results is presented below: Three Months Ending Twelve Months Ending December 31, 2013 December 31, 2013 Per Diluted Per Diluted Share Share In Millions, Except Low High Low High Low High Low High Per Share Amounts Projected GAAP Net ($21.0) ($18.7) ($0.75) ($0.67) $21.0 $23.3 $0.72 $0.80 Income (Loss) Adjustments: Stock-based $4.0 $4.0 $0.14 $0.14 $15.8 $15.8 $0.55 $0.55 compensation Amortization expense of acquired $1.8 $1.8 $0.07 $0.07 $7.1 $7.1 $0.24 $0.24 intangible assets Projected Non-GAAP ($15.2) ($12.9) ($0.54) ($0.46) $43.9 $46.2 $1.51 $1.59 Net Income (Loss) Adjustments: Depreciation $5.5 $5.5 $0.20 $0.20 $20.8 $20.8 $0.72 $0.72 Interest and other $0.1 $0.5 $0.00 $0.02 $2.1 $2.6 $0.07 $0.09 expense, net Provision for ($2.7) ($2.4) ($0.10) ($0.09) $3.2 $3.4 $0.11 $0.12 income taxes Adjusted EBITDA ($12.3) ($9.3) ($0.44) ($0.33) $70.0 $73.0 $2.41 $2.52 Weighted Average Number of Common 28.0 28.0 29.0 29.0 Shares Outstanding-Diluted CONTACT: Investor Relations Contact: Brian Norris EnerNOC, Inc. +1.617.532.8104 firstname.lastname@example.org Media and Analyst Contact: Robin Deliso EnerNOC, Inc. +1.617.692.2601 email@example.com EnerNOC, Inc. 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EnerNOC Reports Record Results for Third Quarter of 2013
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