Milwaukee, Wis., June 11, 2015 – ARI Network Services, Inc. (NASDAQ: ARIS), an award-winning provider of SaaS, software tools and marketing services that help dealers, distributors and manufacturers Sell More Stuff!™, reported financial results today for its fiscal 2015 third quarter ended April 30, 2015. Highlights for the third quarter of fiscal 2015 included:

  • Revenue increased 25.7% to $10.3 million which compares with $8.2 million for the same period last year and $10.1 million in 2Q15.
  • Operating income was $675, 000, compared with $365, 000 for the same period last year and $670, 000 in 2Q15.
  • EBITDA, a non-GAAP measure, adjusted for certain non-cash charges, was $1.6 million or 15.8% of revenue. This compares with EBITDA of $1.3 million or 15.4% of revenue in the same period last year and $1.6 million or 16.1% of revenue in 2Q15.
  • Cash generated from operations was $1.9 million, compared with $1.0 million for the same period last year and $1.1 million in 2Q15.  Cash generated over the last six months has been sufficient to fully pay down the $2.1 million that was initially drawn on the line of credit for the TCS transaction. In 3Q15, the Company drew down $1.75 million on the line associated with its purchase of TASCO.
  • The Company completed its acquisition of TASCO Corporation and its affiliated company Signal Extraprise Corporation (“TASCO”) on April 27, 2015, further cementing its position as the most complete technology provider in the automotive tire and wheel aftermarket.

Fiscal Year 2015 Third Quarter Financial Results ARI achieved 25.7% revenue growth as it reported revenues of $10.3 million for the third quarter of fiscal year 2015, compared with $8.2 million for the same period last year.  Recurring revenues were $9.3 million, versus $7.6 million in the same period last year. Recurring revenue comprised 90.5% of total revenue versus 93.3% for the same period last year. Gross margin for the third quarter of fiscal year 2015 was 82.7% versus 80.9% last year. Operating income was $675, 000 for the third quarter of fiscal year 2015, compared with $365, 000 for the same period last year, an 84.9% increase. The Company’s net income increased 112% to $339, 000 or $0.02 per diluted share for the quarter, compared with $160, 000 or $0.01 per diluted share last year. Subsequent to Q3, the Company announced it issued approximately 1.5 million shares pursuant to an underwritten offering of its common stock. Including exercise of the over-allotment, the offering, which settled on May 12, 2015, generated gross proceeds of $5.3 million and will net proceeds of approximately $4.7 million.

Financial Statements

Management Discussion Roy W. Olivier, President and Chief Executive Officer of ARI, commented, “Our results for the third quarter and our fiscal year to date reflect our continued ability to grow revenues while generating solid profitability and cash flow. In Q3, we completed the TASCO acquisition, which with TCS, consolidates two industry-leading platforms of business management software in the automotive tire and wheel aftermarket. In addition, the equity offering we did in May leaves us well positioned to execute on our future acquisition strategy.” William Nurthen, Chief Financial Officer, commented, “Our operating profit and EBITDA performance in the third quarter was strong when you consider we posted similar results to the prior quarter but in Q3 incurred over $100, 000 in costs related to the TASCO acquisition. In addition, the cash flow from operations result was one of the best in the Company’s history.” Third quarter Fiscal 2015 Conference Call ARI will conduct a conference call on Thursday, June 11, 2015 at 4:30 pm ET to review the financial results for the fiscal quarter ended April 30, 2015. Interested parties can access the conference call by dialing 877.359.3639 or 408.427.3725 and referring to Conference ID: 39502762. The conference call is also being webcast and is available via the Company’s investor relations website at investor.arinet.com. A replay of the webcast will be archived on the Company’s website for 60 days. Non-GAAP Measures EBITDA, a non-GAAP measure, is defined as earnings before interest, income taxes, depreciation and amortization. Management believes EBITDA, to be a meaningful indicator of our performance that provides useful information to investors regarding our financial condition and results of operations. While management considers EBITDA to be an important measure of comparative operating performance, it should be considered in addition to, but not as a substitute for, net income and other measures of financial performance reported in accordance with generally accepted accounting principles (GAAP). Not all companies calculate EBITDA in the same manner and the measure as presented may not be comparable to similarly titled measures presented by other companies. A reconciliation of net income to EBITDA can be found at the Company’s investor relations website for all periods presented.

Reconciliation of non-GAAP

About ARI ARI Network Services, Inc. (ARI) (NASDAQ: ARIS) offers an award-winning suite of SaaS, software tools and marketing services to help dealers, equipment manufacturers and distributors in selected vertical markets Sell More Stuff!™ – online and in-store. Our innovative products are powered by a proprietary data repository of enriched original equipment and aftermarket electronic content spanning more than 17 million active part and accessory SKUs and 750, 000 equipment models. Business is complicated, but we believe our customers’ technology tools don’t have to be. We remove the complexity of selling and servicing new and used vehicle inventory, parts, garments and accessories (PG&A) for customers in the automotive tire and wheel aftermarket, powersports, outdoor power equipment, marine, home medical equipment, recreational vehicles and appliance industries. More than 23, 500 equipment dealers, 195 distributors and 3, 360 brands worldwide leverage our web and eCatalog platforms to Sell More Stuff!™ For more information on ARI, visit investor.arinet.com. Additional Information:

Images for media use only: ARI Logo Hi Res | ARI Logo Low Res Forward-Looking Statements Certain statements in this news release contain “forward‐looking statements” regarding future events and our future results that are subject to the safe harbors created under the Securities Act of 1933. All statements other than statements of historical facts are statements that could be deemed to be forward-looking statements. These statements are based on current expectations, estimates, forecasts, and projects about the markets in which we operate and the beliefs and assumptions of our management. Words such as “expects, ” “anticipates, ” “targets, ” “goals, ” “projects”, “intends, ” “plans, ” “believes, ” “seeks, ” “estimates, ” “endeavors, ” “strives, ” “may, ” or variations of such words, and similar expressions are intended to identify such forward-looking statements. Readers are cautioned that these forward‐looking statements are subject to a number of risks, uncertainties and assumptions that are difficult to predict, estimate or verify. Therefore, actual results may differ materially and adversely from those expressed in any forward-looking statements. Such risks and uncertainties include those factors described in Part 1A of the company’s most recent annual report on Form 10‐K, as such may be amended or supplemented by subsequent quarterly reports on Form 10-Q, or other reports filed with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward‐looking statements. The forward‐looking statements are made only as of the date hereof, and the company undertakes no obligation to publicly release the result of any revisions to these forward‐looking statements. For more information, please refer to the company’s filings with the Securities and Exchange Commission. For media inquiries, contact: Colleen Malloy, Director of Marketing, ARI, +1.414.973.4323,  Colleen.Malloy@arinet.com Investor inquiries, contact: Steven Hooser, Three Part Advisors, +1.214.872.2710,  shooser@threepa.com

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