Financials: Wireless Ronin’s Groundhog Day Numbers

November 23, 2012 by Dave Haynes

There’s a bit of a Groundhog Day thing going when it comes to the quarterly financials coming out of embattled software company Wireless Ronin.

Quarter after quarter after quarter, they lose a pile of money. And quarter after quarter people like me, sitting safely in the bleachers, wonder how long they can hang on.

But you know what? This has been going on for years now and they are still there, no matter how many industry people speculate that they’ll be done by some date or other. To their credit, the management team that came in has dramatically slowed the burn rate. They’ve had far less success getting out of the red, however.

The latest SEC-required numbers came out from Minneapolis a couple of weeks ago (missed them), and show what transpired leading up to the end of September.

The company says:

• Revenue increased 14% sequentially to $1.8 million
• Recurring revenue increased 14% sequentially and 37% year-over-year to a record $538,000
• Achieved lowest quarterly operating expense level since going public
• Completed $1.4 million registered direct offering to the company’s two largest institutional investors, as well as Wireless Ronin’s entire board of directors and executive management team

It also says Aramark renewed some work and a customized deployment of large digital messaging screens, photo booths and interactive touchscreen media is rolling out with Buffalo Wild Wings.

The full numbers, however, show sales are down 23% from a year ago and the company lost another $1.2 million in the quarter.

Strap on your accounting decoder:

Third quarter 2012 net loss totaled $1.2 million or $(0.05) per basic and diluted share, unchanged from the previous quarter and an improvement from a net loss of $1.4 million or $(0.07) per basic and diluted share in the same year-ago quarter. Net loss for the third quarter of 2012 included $99,000 of non-cash stock compensation expense versus $117,000 in the previous quarter, and $169,000 in the year-ago quarter.

Non-GAAP operating loss in the third quarter of 2012 totaled $1.0 million or $(0.04) per basic and diluted share, which was unchanged from the previous quarter and an improvement from a non-GAAP operating loss of $1.1 million or $(0.06) per basic and diluted share in the same year-ago period. The company defines non-GAAP operating loss as GAAP operating loss with the add-back of certain items.  

Congratulations if you have any clue what that means. I get the “loss” part, but not a whole lot more.

Management Commentary
“Sequential improvement in our Q3 results reflects our continued focus on building our recurring revenue base and driving expense optimization,” said Scott Koller, president and CEO of Wireless Ronin. “We achieved several milestones in the quarter, including record recurring revenue and the lowest quarterly operating expense level since our company went public. We continue to diversify our customer base and marketing technology offerings with recent deployments in the QSR and food service verticals, including Buffalo Wild Wings, Boston University, and Villanova University.”

“During the quarter, we transitioned the successful pilot program with Buffalo Wild Wings into an ongoing installation across 50 of its more than 830 locations. Altogether, these deployments validate Wireless Ronin’s capabilities beyond traditional digital menu boards, and show how we can be a valuable partner for organizations looking to enhance their customers’ experience, increase customer loyalty and drive new business.”

“The $270,000 annual hosting renewal order from ARAMARK in Q3 was followed by $773,000 in Q4 orders from an existing automotive customer for content development and maintenance. These purchase orders demonstrate our digital marketing solutions bring value to the end-user experience, ultimately driving sales for our customers and providing predicable recurring revenue for Wireless Ronin.”