Fourth Quarter Revenue Increased 30% to a Record $19.6 Million, Producing $6.7 Million of Cash Flow from Operations
Full Year 2024 Revenue Increased 25% to $75.2 Million, Generating GAAP EPS of $0.50
BOCA RATON, Fla., Feb. 27, 2025 (GLOBE NEWSWIRE) -- Red Violet, Inc. (NASDAQ: RDVT), a leading analytics and information solutions provider, today announced financial results for the fourth quarter and full year ended December 31, 2024.
"We are proud to announce record-breaking financial results for 2024, including record revenue in the fourth quarter, which marks a significant achievement as we defied the historic seasonality we typically experience during that quarter,” stated Derek Dubner, red violet's CEO. "The market is recognizing what we have known all along-we have built the leading technology platform with superior solutions and unique capabilities that outperform even our larger competitors. Our ability to consistently deliver value to our customers fuels our exceptional growth and profitability, and we remain committed to pushing the boundaries of innovation and penetrating our markets to further expand our leadership. With strong momentum, we are well-positioned for 2025 and beyond.”
Fourth Quarter Financial Results
For the three months ended December 31, 2024 as compared to the three months ended December 31, 2023:
- Total revenue increased 30% to $19.6 million.
- Gross profit increased 43% to $13.7 million. Gross margin increased to 70% from 64%.
- Adjusted gross profit increased 37% to $16.1 million. Adjusted gross margin increased to 82% from 78%.
- Net income was $0.9 million compared to a net loss of $1.1 million, which resulted in earnings of $0.06 per basic and diluted share. Net income margin was 4% compared to a net loss margin of 7%.
- Adjusted EBITDA increased 68% to $4.5 million. Adjusted EBITDA margin increased to 23% from 18%.
- Adjusted net income increased 390% to $1.3 million, which resulted in adjusted earnings of $0.10 and $0.09 per basic and diluted share, respectively.
- Cash from operating activities increased 59% to $6.7 million.
- Cash and cash equivalents were $36.5 million as of December 31, 2024.
For the year ended December 31, 2024 as compared to the year ended December 31, 2023:
- Total revenue increased 25% to $75.2 million.
- Gross profit increased 33% to $51.8 million. Gross margin increased to 69% from 65%.
- Adjusted gross profit increased 30% to $61.2 million. Adjusted gross margin increased to 81% from 78%.
- Net income was $7.0 million compared to $13.5 million (inclusive of a one-time deferred income tax benefit of $10.3 million in 2023), which resulted in earnings of $0.51 and $0.50 per basic and diluted share, respectively. Net income margin decreased to 9% from 22%.
- Adjusted EBITDA increased 44% to $23.6 million. Adjusted EBITDA margin increased to 31% from 27%.
- Adjusted net income increased 42% to $11.5 million, which resulted in adjusted earnings of $0.83 and $0.82 per basic and diluted share, respectively.
- Cash from operating activities increased 59% to $24.0 million.
- Added 183 customers to IDI™ during the fourth quarter, ending the year with 8,926 customers.
- Added 18,451 users to FOREWARN® during the fourth quarter, ending the year with 303,418 users. Over 525 REALTOR® Associations are now contracted to use FOREWARN.
- Continued growth in the onboarding of higher-tier customers, with 96 customers contributing over $100,000 of revenue in 2024 compared to 72 customers in 2023.
- Demonstrating strong operational performance, financial resilience, and a disciplined approach to capital allocation focused on shareholder value, we repurchased 292,744 shares of common stock in 2024 at an average price of $19.81 per share. Additionally, in the fourth quarter, we announced a special cash dividend of $0.30 per share payable February 14, 2025, all while continuing ongoing investments in innovation, infrastructure, and market expansion.
In conjunction with this release, red violet will host a conference call and webcast today at 4:30pm ET to discuss its quarterly and full year results and provide a business update. Please click here to pre-register for the conference call and obtain your dial in number and passcode. To access the live audio webcast, visit the Investors section of the red violet website at www.redviolet.com. Please login at least 15 minutes prior to the start of the call to ensure adequate time for any downloads that may be required. Following the completion of the conference call, an archived webcast of the conference call will be available on the Investors section of the red violet website at www.redviolet.com.
About red violet®
At red violet, we build proprietary technologies and apply analytical capabilities to deliver identity intelligence. Our technology powers critical solutions, which empower organizations to operate with confidence. Our solutions enable the real-time identification and location of people, businesses, assets and their interrelationships. These solutions are used for purposes including identity verification, risk mitigation, due diligence, fraud detection and prevention, regulatory compliance, and customer acquisition. Our intelligent platform, CORE™, is purpose-built for the enterprise, yet flexible enough for organizations of all sizes, bringing clarity to massive datasets by transforming data into intelligence. Our solutions are used today to enable frictionless commerce, to ensure safety, and to reduce fraud and the concomitant expense borne by society. For more information, please visit www.redviolet.com.
Company Contact:
Camilo Ramirez
Red Violet, Inc.
561-757-4500
Investor Relations Contact:
Steven Hooser
Three Part Advisors
214-872-2710
Use of Non-GAAP Financial Measures
Management evaluates the financial performance of our business on a variety of key indicators, including non-GAAP metrics of adjusted EBITDA, adjusted EBITDA margin, adjusted net income, adjusted earnings per share, adjusted gross profit, adjusted gross margin, and free cash flow ("FCF"). Adjusted EBITDA is a non-GAAP financial measure equal to net income (loss), the most directly comparable financial measure based on US GAAP, excluding interest income, income tax (benefit) expense, depreciation and amortization, share-based compensation expense, litigation costs, and write-off of long-lived assets and others. We define adjusted EBITDA margin as adjusted EBITDA as a percentage of revenue. Adjusted net income is a non-GAAP financial measure equal to net income (loss), the most directly comparable financial measure based on US GAAP, excluding share-based compensation expense, amortization of share-based compensation capitalized in intangible assets, and discrete tax items, and including the tax effect of adjustments. We define adjusted earnings per share as adjusted net income divided by the weighted average shares outstanding. We define adjusted gross profit as revenue less cost of revenue (exclusive of depreciation and amortization), and adjusted gross margin as adjusted gross profit as a percentage of revenue. We define FCF as net cash provided by operating activities reduced by purchase of property and equipment and capitalized costs included in intangible assets.
FORWARD-LOOKING STATEMENTS
This press release contains "forward-looking statements," as that term is defined under the Private Securities Litigation Reform Act of 1995 (PSLRA), which statements may be identified by words such as "expects," "plans," "projects," "will," "may," "anticipate," "believes," "should," "intends," "estimates," and other words of similar meaning. Such forward looking statements are subject to risks and uncertainties that are often difficult to predict, are beyond our control and which may cause results to differ materially from expectations, including whether we will continue pushing the boundaries of innovation and penetrating our markets to further expand our leadership and whether we are well-positioned for 2025 and beyond. Readers are cautioned not to place undue reliance on these forward-looking statements, which are based on our expectations as of the date of this press release and speak only as of the date of this press release and are advised to consider the factors listed above together with the additional factors under the heading "Forward-Looking Statements" and "Risk Factors" in red violet's Form 10-K for the year ended December 31, 2023 filed on March 7, 2024, as may be supplemented or amended by the Company's other SEC filings, including the Form 10-K for year ended December 31, 2024 expected to be filed today. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by law.
| RED VIOLET, INC. CONSOLIDATED BALANCE SHEETS (Amounts in thousands, except share data) | |||||||
| December 31, 2024 | December 31, 2023 | ||||||
| ASSETS: | |||||||
| Current assets: | |||||||
| Cash and cash equivalents | $ | 36,504 | $ | 32,032 | |||
| Accounts receivable, net of allowance for doubtful accounts of $188 and $159 as of December 31, 2024 and 2023, respectively | 8,061 | 7,135 | |||||
| Prepaid expenses and other current assets | 1,627 | 1,113 | |||||
| Total current assets | 46,192 | 40,280 | |||||
| Property and equipment, net | 545 | 592 | |||||
| Intangible assets, net | 35,997 | 34,403 | |||||
| Goodwill | 5,227 | 5,227 | |||||
| Right-of-use assets | 1,901 | 2,457 | |||||
| Deferred tax assets | 7,496 | 9,514 | |||||
| Other noncurrent assets | 1,173 | 517 | |||||
| Total assets | $ | 98,531 | $ | 92,990 | |||
| LIABILITIES AND SHAREHOLDERS' EQUITY: | |||||||
| Current liabilities: | |||||||
| Accounts payable | $ | 2,127 | $ | 1,631 | |||
| Accrued expenses and other current liabilities | 2,881 | 1,989 | |||||
| Current portion of operating lease liabilities | 406 | 569 | |||||
| Deferred revenue | 712 | 690 | |||||
| Dividend payable | 4,181 | - | |||||
| Total current liabilities | 10,307 | 4,879 | |||||
| Noncurrent operating lease liabilities | 1,592 | 1,999 | |||||
| Total liabilities | 11,899 | 6,878 | |||||
| Shareholders' equity: | |||||||
| Preferred stock-$0.001 par value, 10,000,000 shares authorized, and 0 shares issued and outstanding, as of December 31, 2024 and 2023 | - | - | |||||
| Common stock-$0.001 par value, 200,000,000 shares authorized, 13,936,329 and 13,980,274 shares issued, and 13,936,329 and 13,970,846 shares outstanding, as of December 31, 2024 and 2023 | 14 | 14 | |||||
| Treasury stock, at cost, 0 and 9,428 shares as of December 31, 2024 and 2023 | - | (188 | ) | ||||
| Additional paid-in capital | 87,488 | 94,159 | |||||
| Accumulated deficit | (870 | ) | (7,873 | ) | |||
| Total shareholders' equity | 86,632 | 86,112 | |||||
| Total liabilities and shareholders' equity | $ | 98,531 | $ | 92,990 | |||
| RED VIOLET, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (Amounts in thousands, except share data) | ||||||||
| Year Ended December 31, | ||||||||
| 2024 | 2023 | |||||||
| Revenue | $ | 75,189 | $ | 60,204 | ||||
| Costs and expenses(1): | ||||||||
| Cost of revenue (exclusive of depreciation and amortization) | 13,997 | 13,069 | ||||||
| Sales and marketing expenses | 17,835 | 13,833 | ||||||
| General and administrative expenses | 25,875 | 22,446 | ||||||
| Depreciation and amortization | 9,562 | 8,352 | ||||||
| Total costs and expenses | 67,269 | 57,700 | ||||||
| Income from operations | 7,920 | 2,504 | ||||||
| Interest income | 1,400 | 1,334 | ||||||
| Income before income taxes | 9,320 | 3,838 | ||||||
| Income tax expense (benefit) | 2,317 | (9,691 | ) | |||||
| Net income | $ | 7,003 | $ | 13,529 | ||||
| Earnings per share: | ||||||||
| Basic | $ | 0.51 | $ | 0.97 | ||||
| Diluted | $ | 0.50 | $ | 0.96 | ||||
| Weighted average shares outstanding: | ||||||||
| Basic | 13,864,797 | 13,974,125 | ||||||
| Diluted | 14,125,825 | 14,134,021 | ||||||
| (1) Share-based compensation expense in each category: | ||||||||
| Sales and marketing expenses | $ | 606 | $ | 462 | ||||
| General and administrative expenses | 5,342 | 4,924 | ||||||
| Total | $ | 5,948 | $ | 5,386 | ||||
| RED VIOLET, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (Amounts in thousands) | |||||||
| Year Ended December 31, | |||||||
| 2024 | 2023 | ||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||
| Net income | $ | 7,003 | $ | 13,529 | |||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
| Depreciation and amortization | 9,562 | 8,352 | |||||
| Share-based compensation expense | 5,948 | 5,386 | |||||
| Write-off of long-lived assets | 85 | 6 | |||||
| Provision for bad debts | 342 | 1,088 | |||||
| Noncash lease expenses | 556 | 576 | |||||
| Deferred income tax expense (benefit) | 2,018 | (9,801 | ) | ||||
| Changes in assets and liabilities: | |||||||
| Accounts receivable | (1,268 | ) | (2,688 | ) | |||
| Prepaid expenses and other current assets | (514 | ) | (342 | ) | |||
| Other noncurrent assets | (656 | ) | 84 | ||||
| Accounts payable | 496 | (598 | ) | ||||
| Accrued expenses and other current liabilities | 936 | 100 | |||||
| Deferred revenue | 22 | 20 | |||||
| Operating lease liabilities | (570 | ) | (641 | ) | |||
| Net cash provided by operating activities | 23,960 | 15,071 | |||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||
| Purchase of property and equipment | (169 | ) | (122 | ) | |||
| Capitalized costs included in intangible assets | (9,398 | ) | (9,024 | ) | |||
| Net cash used in investing activities | (9,567 | ) | (9,146 | ) | |||
| CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||
| Taxes paid related to net share settlement of vesting of restricted stock units | (4,068 | ) | (1,992 | ) | |||
| Repurchases of common stock | (5,853 | ) | (3,711 | ) | |||
| Net cash used in financing activities | (9,921 | ) | (5,703 | ) | |||
| Net increase in cash and cash equivalents | $ |
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