Liquidity Services, Inc. Announces Cessation in Sale of Selected U.S.
Defense Logistics Agency Surplus Property Items and Preliminary Third
Quarter Fiscal Year 2014 Results
WASHINGTON -- July 10, 2014
Liquidity Services, Inc. (NASDAQ:LQDT), a global solutions provider in the
reverse supply chain with the leading marketplace for business surplus, today
announced that its sales of selected rolling stock and other assets under its
Surplus Contract with the U.S. Defense Logistics Agency (DLA) have ceased at
the request of DLA pending further review of the impact of regulatory rules,
unrelated to the Company’s performance or conduct, on the DLA rolling stock
property stream. This action has resulted in the cancellation of selected
sales during the June quarter as well as future sales of selected assets.
Liquidity Services anticipates these developments will adversely impact its
financial results for its fiscal third quarter ended June 30, 2014 and for its
fiscal year 2014. The Company’s preliminary third quarter results are subject
to change as the Company is still in the process of finalizing the financial
results for the quarter.
For the third quarter of fiscal year 2014 ending June 30, 2014, the Company
now estimates its preliminary unaudited financial results to be as follows:
*Total Gross Merchandise Volume (GMV) is expected to be within its guidance
range of $225 million to $250 million.
*Adjusted EBITDA is expected to be approximately 10-20% below its guidance
range of $18.0 million to $21.0 million
*Adjusted Earnings per Diluted Share is expected to be approximately 10-20%
below its guidance range of $0.28 to $0.34.
The Company plans to report its unaudited financial results for the third
quarter on August 7, 2014, and at that time will provide updated guidance on
the impact to its fiscal year 2014 financial results.
Our guidance adjusts EBITDA and Diluted EPS for: (i) acquisition costs
including transaction costs and changes in earn out estimates; (ii)
amortization of contract related intangible assets of $33.3 million from our
acquisition of Jacobs Trading; and (iii) for stock based compensation costs,
which we estimate to be approximately $3.5 million to $4.0 million per quarter
for fiscal year 2014. These stock based compensation costs are consistent with
fiscal year 2013.
The Company will host a conference call to discuss preliminary fiscal third
quarter results at 8:30 a.m. Eastern Time today. Investors and other
interested parties may access the teleconference by dialing 800-798-2864 or
617-614-6206 and providing the participant pass code 78208751. A live webcast
of the conference call will be provided on the Company’s investor relations
website at http://www.liquidityservicesinc.com/investors/. A replay of the
webcast will be available on the Company’s website ending July 10, 2015 at
11:59 p.m. ET. An audio replay of the teleconference will also be available
until July 17, 2014 at 11:59 p.m. ET. To listen to the replay, dial
888-286-8010 or 617-801-6888 and provide the participant pass code 87329825.
Both replays will be available starting at 12:30 p.m. ET today.
This document contains forward-looking statements made pursuant to the Private
Securities Litigation Reform Act of 1995. These statements are only
predictions. The outcome of the events described in these forward-looking
statements is subject to known and unknown risks, uncertainties and other
factors that may cause our actual results, levels of activity, performance or
achievements to differ materially from any future results, levels of activity,
performance or achievements expressed or implied by these forward-looking
statements. These statements include, but are not limited to, statements
regarding the Company’s business outlook and expected future effective tax
rates. You can identify forward-looking statements by terminology such as
"may," "will," "should," "could," "would," "expects," "intends," "plans,"
"anticipates," "believes," "estimates," "predicts," "potential," "continues"
or the negative of these terms or other comparable terminology. Although we
believe that the expectations reflected in the forward-looking statements are
reasonable, we cannot guarantee future results, levels of activity,
performance or achievements.
There are a number of risks and uncertainties that could cause our actual
results to differ materially from the forward-looking statements contained in
this document. Important factors that could cause our actual results to differ
materially from those expressed as forward-looking statements are set forth in
our filings with the SEC from time to time, and include, among others, our
dependence on our contracts with the DoD and Wal-Mart for a significant
portion of our revenue and profitability; our ability to successfully expand
the supply of merchandise available for sale on our online marketplaces; our
ability to attract and retain active professional buyers to purchase this
merchandise; the timing and success of upgrades to our technology
infrastructure; our ability to successfully complete the integration of any
acquired companies, including NESA and Go-Industry, into our existing
operations and our ability to realize any anticipated benefits of these or
other acquisitions; and our ability to recognize any expected tax benefits as
a result of closing our U.K. retail consumer goods operations. There may be
other factors of which we are currently unaware or deem immaterial that may
cause our actual results to differ materially from the forward-looking
All forward-looking statements attributable to us or persons acting on our
behalf apply only as of the date of this document and are expressly qualified
in their entirety by the cautionary statements included in this document.
Except as may be required by law, we undertake no obligation to publicly
update or revise any forward-looking statement to reflect events or
circumstances occurring after the date of this document or to reflect the
occurrence of unanticipated events.
About Liquidity Services, Inc.
Liquidity Services, Inc. (NASDAQ:LQDT) provides leading corporations, public
sector agencies and buying customers the world's most transparent, innovative
and effective online marketplaces and integrated services for surplus assets.
On behalf of its clients, Liquidity Services has completed the sale of over
$4.5 billion of surplus, returned and end-of-life assets, in over 500 product
categories, including consumer goods, capital assets and industrial equipment.
The Company is based in Washington, D.C. and has over 1,300 employees.
Additional information can be found at: http://www.liquidityservices.com.
Liquidity Services, Inc.
Julie Davis, 202-558-6234
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