Wireless Ronin sales jump, but firm still lost another $2.3M
May 12, 2011 by Dave Haynes
The latest required financial results from Minneapolis-based Wireless Ronin show work they are doing with Chrysler and, by extension, Fiat, as well as more work with Aramark, made for a positive spin on sales numbers.
RNIN did $2.4 million in sales for Q1, up 123 percent increase year-over-year. Software license sales were up 264 percent year-over-year.
However, the company still lost $2.3 million in Q1, down $500K year over year but still a big red number. The accumulated deficit is now well into the $70 million range since the lights went on.
The sales revenue number is also lower and the loss higher than it was in Q4, which my MBA-less little brain nonetheless sees as the wrong trend.
Here’s what the release says:
Wireless Ronin reported revenue of $2.4 million for the first quarter of 2011, a 123 percent increase from $1.1 million in the first quarter of 2010. The year-over-year increase in revenue was primarily attributable to sales with Chrysler and its dealership network. Additionally, the increase was due to an approximate 600 percent increase in orders from ARAMARK, which included its newest food concept, Grille Works. Also, the Company’s recurring hosting and support revenue for the first three months of 2011 totaled $0.4 million.
Scott W. Koller, president and chief executive officer of Wireless Ronin Technologies, said, “We had several key wins during the first quarter that continue to position the Company for long-term success. Our newly formed relationship with Sprint provides a nationwide extension of our sales team to focus on retail digital signage solutions. In addition, winning the pilot with Johnny Rockets once again demonstrates our leadership in providing a digital menu board solution to the food service industry.”
The Company reported a first quarter net loss of $2.3 million, or $0.12 per basic and diluted share, compared to a net loss of $2.8 million, or $0.16 per basic and diluted share, in the year-ago period. The improvement in the year-over-year net loss was driven primarily by the increase in gross margin dollars, partially offset by a year-over-year increase in operating expenses. The first quarter 2011 and 2010 results also included costs of approximately $0.3 million, or $0.02 per basic and diluted share, of non-cash stock compensation expense for each period.
Non-GAAP operating loss totaled $1.8 million, or $0.09 per basic and diluted share, in the first quarter of 2011 compared to a non-GAAP operating loss of $2.4 million, or $0.14 per basic and diluted share, in the first quarter of 2010. Non-GAAP operating loss is defined as the GAAP operating loss with the add-back of certain items. Reconciliation to the GAAP operating loss on a quarterly basis is contained in a table following the unaudited financial information accompanying this release.
For the first quarter of 2011, gross margin averaged 46 percent, compared to a gross margin of 39 percent in the first quarter of 2010. The year-over-year increase was due to a 264 percent increase in sales of RoninCast® software and a 35 percent increase in recurring hosting fees during the first three months of 2011 when compared to the same period in 2010.
Cash and cash equivalents in combination with restricted cash at March 31, 2011, totaled approximately $5.6 million compared to $7.1 million at the end of 2010. The decline in cash from the prior year-end reflected the continued funding of the Company’s losses during the first quarter 2011. In January 2011, the Company renewed the $2.5 million line of credit with Silicon Valley Bank, extending the agreement to March 2012.
The $5.6 million number is the one to watch. That keeps getting smaller, and its effectively the one keeping the lights on.