Good News Pushes @RMGNetworks Stock up 65%
Adrian J Cotterill, Editor-in-Chief
RMG Networks (NASDAQ: RMGN) Monday released preliminary results for its fourth quarter and full year ended December 31, 2014, ahead of the company’s scheduled presentation at the 27th Annual ROTH Conference in order that management can discuss updated financial information with the investment community (there is of course NO OBLIGATION to issue preliminary results in the future).
The announcement said that it expected Sequential Adjusted Revenue Growth to Exceed 30% in the Fourth Quarter With Stable Adjusted Gross Margin and Improved Adjusted EBITDA.
Quarterly Adjusted Revenue was expected to be approximately $18.6 Million for Fourth Quarter 2014 and Adjusted Revenue of Approximately $61.8 Million for Full-Year 2014
Both of the company’s business units are expected to show strong sequential fourth quarter adjusted revenue growth. In its Enterprise and Media businesses, fourth quarter adjusted revenue is expected to be $13.1 million and $5.5 million, respectively.
Amateur sleuthing note here: If RMG Enterprise business was $13m for the quarter that means ‘they’ (the division) are something like a $52m business for the year – that is REAL growth in two years – when RMG Networks bought Symon Corporation, it was a $40m business with $8m EBITDA.
These preliminary financial results are subject to completion of the company’s customary year-end closing and review procedures and audit by the company’s independent registered public accounting firm.
Bob Michelson, Chief Executive Officer, commented, “We executed well in the fourth quarter and our results are encouraging as we expect strong sequential growth in both adjusted revenue and adjusted EBITDA. In addition, we continued to successfully implement the strategic initiatives that we expect will further establish the platform for long-term success.”
“Since the third quarter, we have brought to market the first three products in our ‘Six New Products in Six Months’ initiative, strengthening our product portfolio with unique solutions,” continued Mr. Michelson. “In addition, our sales team has significantly bolstered the number of seven-figure deals in our pipeline. This steadfast focus on product innovation, global coordination and sales team productivity has begun to drive the momentum that we believe will deliver accelerated growth beginning later this year.”
By the close of the day nine million shares had been traded compared to a more normal average daily volume, over the past 30 days, of 11,000 shares. Shares in RMG Networks, which closed just a little over a dollar last week, rose 65% on the news an closed at $1.74.
March 10th, 2015 at 14:20 @639
What new business is driving the revenue growth?