EnerNOC, Inc.
Nov 7, 2013

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 Share Amounts Q3 2013 Q3 2012 % Change Q3 YTD Q3 YTD % Change
        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-GAAP1 $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-GAAP1 $3.90 $2.40 62.5% $2.06 $0.70 194.3%
Cash Flow From Operations $21,295 $8,625 146.9% $33,459 $12,866 160.1%
Free Cash Flow1 $15,556 $6,007 159.0% $534 $1,114 (52.1%)
Adjusted EBITDA1 $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

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 Share1 ($0.54)-($0.46)
 Adjusted EBITDA1 (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 millions) $360.0-$400.0 $380.0-$385.0
GAAP Earnings Per Diluted Share $0.60-$0.85 $0.72-$0.80
Non-GAAP Earnings Per Diluted Share1 $1.39-$1.71 $1.51-$1.59
Adjusted EBITDA1 (in millions) $62.0-$77.0 $70.0-$73.0
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 September 30, Nine Months Ended September 30,
  2013 2012 2013 2012
Revenues:        
DemandSMART   $ 267,479  $ 169,658  $ 318,553   213,586 
EfficiencySMART, SupplySMART and other  10,994  8,289 28,923  22,084
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 income tax  (5,284) 718 (5,828) (95)
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 contract costs 3,513 10,226
Prepaid expenses, deposits and other current assets 8,726 6,945
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 contract costs 2,213 3,929
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 liabilities 13,653 9,663
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, respectively 30 29
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' equity  $ 455,070 $355,165
     
         
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 activities (8,450) 5,009 (33,803) (7,147)
Cash (used in) provided by financing activities (3,423) 76 (2,632) 141
Effects of exchange rate changes on cash and cash equivalents 232 44 (835) 11
Net change in cash and cash equivalents $9,654 $13,754 $(3,811) $5,871
Cash and cash equivalents at beginning of period $101,576 $79,414 $115,041 $87,297
Cash and cash equivalents at end of period $111,230 $93,168 $111,230 $93,168
         

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:

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 intangible assets (1) 1,703 1,808
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 intangible assets (1) 0.06 0.07
Non-GAAP net income per diluted share  $ 3.90  $ 2.40
     
Weighted average number of diluted common shares outstanding 28,843,010 27,325,949
     
  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 intangible assets (1) 5,260 5,438
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 intangible assets (1) 0.18 0.20
Non-GAAP net income per diluted share  $ 2.06  $ 0.70
     
Weighted average number of diluted common shares outstanding 28,616,552 27,069,569
(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 30, Nine Months Ended September 30,
  2013  2012  2013 2012 
Net income   $ 106,857  $ 60,348  $ 41,969  $ 3,499
Add back:        
Depreciation and amortization  7,055 6,428 20,616 18,852
Stock-based compensation expense  3,821 3,341 11,832 10,018
Other (income) expense, net  (233) (619)  884 (1,316)
Interest expense  451 300  1,212 1,197
Provision for (benefit from) income tax  5,284 (718)  5,828 95
Adjusted EBITDA   $ 123,235  $ 69,080  $ 82,341  $ 32,345
         
         
EnerNOC, Inc.
Reconciliation of Free Cash Flow
(in thousands)
(unaudited)
         
  Three Months Ended September 30, Nine Months Ended September 30,
  2013 2012 2013  2012
Net cash provided by operating activities   $ 21,295  8,625    $ 33,459  $ 12,866
Subtract:        
Purchases of property and equipment  (5,739) (2,618) (32,925) (11,752)
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 Share     Per Diluted Share
In Millions, Except Per Share Amounts Low High Low High Low High Low High
                 
Projected GAAP Net Income (Loss)  ($21.0)   ($18.7) ($0.75) ($0.67) $21.0 $23.3 $0.72 $0.80
                 
Adjustments:                
Stock-based compensation  $ 4.0  $ 4.0 $0.14 $0.14 $15.8 $15.8 $0.55 $0.55
Amortization expense of acquired intangible assets  $ 1.8  $ 1.8 $0.07 $0.07 $7.1 $7.1 $0.24 $0.24
Projected Non-GAAP Net Income (Loss)  ($15.2)  ($12.9) ($0.54) ($0.46) $43.9 $46.2 $1.51 $1.59
                 
Adjustments:                
Depreciation  $ 5.5  $ 5.5 $0.20 $0.20 $20.8 $20.8 $0.72 $0.72
Interest and other expense, net  $ 0.1  $ 0.5 $0.00 $0.02 $2.1 $2.6 $0.07 $0.09
Provision for income taxes ($2.7)  ($2.4) ($0.10) ($0.09) $3.2 $3.4 $0.11 $0.12
Adjusted EBITDA  ($12.3)  ($9.3) ($0.44) ($0.33) $70.0 $73.0 $2.41 $2.52
                 
Weighted Average Number of Common Shares Outstanding-Diluted 28.0 28.0     29.0 29.0    
CONTACT: Investor Relations Contact:

         Brian Norris

         EnerNOC, Inc.

         +1.617.532.8104

         bnorris@enernoc.com



         Media and Analyst Contact:

         Robin Deliso

         EnerNOC, Inc.

         +1.617.692.2601

         rdeliso@enernoc.com

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