ACCESS Newswire Reports Fourth Quarter and Full Year 2024 Results

• Revenue increased 1% to $5.8M

• Adjusted EBITDA increased $900,000 to $871,000 in Q4 2024

• Cash flow from operations increased to $353,000 from $(236,000) in Q4 2023

• Rebranded to ACCESS Newswire Inc, effective January 27, 2025

• Compliance business was sold for $12.5M on February 28, 2025

• Subscriptions increased to 1,124 from 1,053 in Q4 2023

RALEIGH, NC / ACCESS Newswire / March 25, 2025 / ACCESS Newswire Inc. (NYSE American:ACCS) (the "Company"), a leading communications company, today reported its operating results for the three months and full year ended December 31, 2024.

"Our core business grew modestly in the fourth quarter. During the quarter we executed on several key initiatives, including completion of our rebrand, advancing the strategic sale of our compliance business, which was completed at the end of February, and expanding our subscription business," said Brian R. Balbirnie, ACCESS Newswire's Founder and Chief Executive Officer.

"Looking ahead, we now have a singular focus on our communications business, and we believe a defined path toward improving gross margins and EBITDA margins through operational efficiency and subscription growth. Similar to the fourth quarter, our first quarter will include transaction adjustments-both on the balance sheet, with debt repayment, and on the statement of operations, reflecting the discontinued operations of the compliance business. Additionally, as we move beyond the first quarter, we remain committed to optimizing our capital allocation strategy and increasing our customer counts and market share," added Mr. Balbirnie.

Fourth Quarter 2024 Highlights:

• Revenue - Total revenue was $5,826,000, a 1% increase from $5,762,000 in Q4 2023 and a 3% increase from $5,638,000 in Q3 2024. The increase is primarily due to an increase in revenue from our previously branded ACCESSWIRE platform due to an increase in average revenue per release, partially offset by a decrease in revenue from our previously branded Newswire distribution platform.

• Gross Margin - Gross margin for Q4 2024 was $4,381,000, or 75% of revenue, compared to $4,318,000, also 75% of revenue, during Q4 2023 and $4,228,000, or 75% of revenue, in Q3 2024.

• Operating Loss - Primarily due to an impairment loss of $14,150,000 related to the tradename associated with Newswire, operating loss was $(14,322,000) for Q4 2024, as compared to operating loss of $(1,131,000) during Q4 2023. Absent the impairment loss, operating expenses were $4,553,000 in Q4 2024 compared to $5,449,000 in Q4 2023. The impairment is associated with our rebrand, in which management determined the appropriate useful life of the tradename was 5 years as opposed to the 15 years originally estimated as part of the original valuation. The decrease in operating expenses is due to lower general and administrative expenses due to lower headcount and stock compensation expense as well as lower sales and marketing expenses due to lower headcount and advertising expense.

• Net Loss from continuing operations - On a GAAP basis, net loss from continuing operations was $(10,945,000), or $(2.85) per diluted share during Q4 2024, compared to net loss from continuing operations of $(1,512,000), or $(0.40) per diluted share during Q4 2023.

• Income from discontinued operations, net of taxes - On a GAAP basis, we recorded income from discontinued operations, net of taxes of $750,000, or $0.19 per diluted share, for Q4 2024, compared to $786,000, or $0.21 per diluted share, in Q4 2023.

• Operating Cash Flows - Cash flows from continuing operations for Q4 2024 were $353,000 compared to cash flows used in continuing operations of $(236,000) in Q4 2023. The increase is due to operational efficiencies which in turn reduced expenses.

• Non-GAAP Measures from continuing operations - Q4 2024 EBITDA was $770,000, or 13% of revenue, compared to $(834,000), or (14)% of revenue, during Q4 2023. Adjusted EBITDA was $871,000, or 15% of revenue, for Q4 2024 compared to $(27,000), or less than negative 1% of revenue, for Q4 2023. Non-GAAP net income for Q4 2024 was $819,000, or $0.21 per diluted share, compared to a non-GAAP net loss of $(275,000), or $(0.07) per diluted share, during Q4 2023. Adjusted free-cash flow was $413,000 for Q4 2024 compared to $(319,000) for Q4 2023.

Full year 2024 Highlights:

• Revenue - Total revenue was $23,057,000, a 6% decrease from $24,522,000 in 2023. The decrease is primarily related to a decrease in volume from our previously branded Newswire news distribution brand.

• Gross Margin - Gross margin was $17,440,000, or 76% of revenue, compared to $18,915,000, or 77% of revenue, during 2023.

• Operating Loss - Operating loss was $(16,319,000) compared to $(2,739,000) in 2023. The increase in operating loss is primarily due to the aforementioned impairment loss of $14,150,000 related to the tradename associated with Newswire. Absent the impairment, total operating expenses decreased $2,045,000 due to lower general and administrative expenses, lower headcount and stock compensation expense as well as lower sales and marketing expenses.

• Net Loss from continuing operations - On a GAAP basis, net loss from continuing operations was $(13,281,000), or $(3.47) per diluted share during 2024, compared to net loss from continuing operations of $(3,441,000), or $(0.90) per diluted share during 2023. The increase in net loss from continuing operations is primarily related to the impairment loss on the Newswire tradenames noted earlier.

• Income from discontinued operations, net of taxes - On a GAAP basis, we recorded income from discontinued operations, net of taxes, of $2,488,000, or $0.65 per diluted share, compared to $4,207,000, or $1.10 per diluted share, in 2023. The decrease is due primarily to two significant print and proxy fulfilment jobs that occurred in the prior year but did not reoccur in 2024.

• Operating Cash Flows - Net operating cash flows provided by continuing operations was $400,000 in 2024 compared to net operating cash flows used in operating activities of $(741,000) in 2023.

• Non-GAAP Measures from continuing operations - EBITDA for 2024 was $840,000, or 4% of revenue, compared to $(342,000), or (1)% of revenue, during 2023. Adjusted EBITDA for 2024 was $1,895,000, or 8% of revenue, compared to $2,005,000, also 8% of revenue, for 2023. Non-GAAP net income for 2024 was $791,000, or $0.21 per diluted share, compared to non-GAAP net income of $538,000, or $0.14 per diluted share, during 2023. Adjusted free-cash flow was $26,000 for 2024 compared to $(476,000) for 2023.

Key Performance Indicators:

• As of December 31, 2024, we had 12,349 customers who had an active contract during the past twelve months, compared to 11,924 as of December 31, 2023.

• Subscription customers increased by 71 to 1,124.

• ARR for subscriptions for quarter was $10,735, up from $9,489 at the end of 2023.

Non-GAAP Information

Certain Non-GAAP financial measures are included in this press release. In the calculation of these measures, the Company excludes certain items, such as amortization of intangible assets, stock-based compensation, tax impact of adjustments, other unusual items and discrete items impacting income tax expense. The Company believes that excluding such items provides investors and management with a representation of the Company's core operating performance and with information useful in assessing its prospects for the future and underlying trends in the Company's operating expenditures and continuing operations. Management uses such Non-GAAP measures to evaluate financial results and manage operations. The release and the attachments to this release provide a reconciliation of each of the Non-GAAP measures referred to in this release to the most directly comparable GAAP measure. The Non-GAAP financial measures are not meant to be considered a substitute for the corresponding GAAP financial statements and investors should evaluate them carefully. These Non-GAAP financial measures may differ materially from the Non-GAAP financial measures used by other companies.

RECONCILIATION OF SELECTED GAAP MEASURES TO NON-GAAP MEASURES
(in thousands, except per share amounts)
CALCULATION OF EBITDA & ADJUSTED EBITDA

(1) This adjustment gives effect to one-time corporate projects, including acquisition and/or integration related expenses, incurred during the periods.
(2) For the three months ended December, 31, 2024 and 2023, this adjustment primarily gives effect to a gain or loss recorded on the change in fair value of our interest rate swap. For the year ended December 31, 2024, this adjustment gives effect to a gain recorded on the change in fair value of our interest rate swap of $81,000, as well as, one-time accounting fees, termination benefits and other non-recurring or unusual expenses of $219,000. For the year ended December 31, 2023, this adjustment gives effect to $370,000 payment related to early extinguishment of our Seller Note and one-time non-recurring expenses of $45,000 and a loss on the change in fair value of our interest rate swap of $21,000.
(3) The adjustments represent stock-based compensation expense related to awards of stock options, restricted stock units, or common stock in exchange for services. Although we expect to continue to award stock in exchange for services, the amount of stock-based compensation is excluded as it is subject to change as a result of one-time or non-recurring projects.

CALCULATION OF NON-GAAP NET INCOME