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SEC Filings

10-Q
LIQUIDITY SERVICES INC filed this Form 10-Q on 05/03/2018
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Total Revenue.  Total consolidated revenue decreased $21.9 million, or 15.3%, to $121.2 million for the six months ended March 31, 2018, from $143.1 million for the six months ended March 31, 2017, primarily due to a $22.4 million decrease in revenue from our CAG segment, a $1.1 million decrease in revenue from our RSCG segment, and a $0.1 million decrease in revenue from Corporate & Other, partially offset by a $1.7 million increase in revenue from our GovDeals segment. Total consolidated GMV decreased $15.9 million, or 4.9%, to $307.5 million for the six months ended March 31, 2018, from $323.4 million for the six months ended March 31, 2017, primarily due to a $42.4 million decrease in GMV from our CAG segment, a $1.9 million decrease within Corporate & Other, partially offset by a $20.2 million increase in GMV from our GovDeals segment, and an $8.2 million increase in GMV from our RSCG segment.

Cost of goods sold.  Cost of goods sold decreased $10.4 million, or 15.6%, to $56.4 million for the six months ended March 31, 2018, from $66.8 million for the six months ended March 31, 2017.  Approximately $8.4 million of this decrease is attributable to a lower volume of sales under our Surplus Contract during the six months ended March 31, 2018, due to the wind-down of that contract. The remainder of this decrease is due to the lower volume of purchase transactions within our Retail and CAG Commercial businesses, as well as the exit of the TruckCenter land-based, live auction business in fiscal 2017, partially offset by increased cost of goods sold within our IronDirect business. As a percentage of revenue, cost of goods sold decreased to 46.5% of revenue, from 46.7%.
 
Seller distributions.  Seller distributions decreased $2.3 million, or 24.2%, to $7.2 million for the six months ended March 31, 2018, from $9.5 million for the six months ended March 31, 2017, due to lower sales under our Scrap Contract during the six months ended March 31, 2018. As a percentage of revenue, seller distributions decreased to 5.9%, from 6.6%.

Technology and operations expenses.  Technology and operations expenses decreased $8.9 million, or 20.7%, to $34.1 million for the six months ended March 31, 2018, from $43.0 million for the six months ended March 31, 2017, due to a decrease in staff costs of approximately $5.5 million, partially the result of business realignment activities. The remaining reduction in these costs can be attributed to lower fees from external contractors and other services, and less costs due to the exit of the TruckCenter land-based, live auction business. As a percentage of revenue, technology and operations expenses decreased to 28.1%, from 30.0%.
 
Sales and marketing expenses.  Sales and marketing expenses decreased $2.6 million, or 13.6%, to $16.5 million for the six months ended March 31, 2018, from $19.1 million for the six months ended March 31, 2017, due to a decrease in marketing labor and promotional spend as a result of certain business realignment and restructuring initiatives.  As a percentage of revenue, sales and marketing expenses slightly increased to 13.6%, from 13.4% in the prior year.
 
General and administrative expenses.  General and administrative expenses decreased $3.1 million, or 17.1%, to $15.0 million for the six months ended March 31, 2018, from $18.1 million for the six months ended March 31, 2017. Included within this decrease are reductions in overall staff cost of approximately $2.0 million, partially the result of business realignment and restructuring initiatives. The remaining reduction in these costs can be attributed to lower non-income tax regulatory costs, and a decrease in certain lease costs. As a percentage of revenue, general and administrative expenses slightly decreased to 12.4%, from 12.6% in the prior year.
 
Depreciation and amortization expenses.  Depreciation and amortization expenses decreased $0.5 million, or 17.2%, to $2.4 million for the six months ended March 31, 2018, from $2.9 million for the six months ended March 31, 2017.
 
Other operating expenses.  Other operating expenses reflected an expense of approximately $1.8 million in the six months ended March 31, 2018, which consisted of approximately $1.8 million of restructuring cost (for further information, see Note 11 to the Consolidated Financial Statements included in this Report), a $0.1 million loss on the value of a right the Company held from its participation in certain principal transactions in the Company's CAG commercial business, slightly offset by $0.1 million of other income. In the six months ended March 31, 2017, Other operating expense of $0.4 million represents a $0.7 million increase in the value of a right the Company holds from its participation in a principal transaction in the Company's CAG commercial business, and $1.1 million in expenses relating to the exit of the TruckCenter land-based, live auction business.

Interest and other (income) expense, net.  Interest and other (income) expense, net, increased $0.6 million over prior year, to $0.7 million for the six months ended March 31, 2018. Interest and other (income) expense, net, consisted of a gain on sale of equipment of approximately $0.5 million, and $0.2 million of interest income on our note receivable.
 
Provision (benefit) for income taxes.  (Benefit) for income taxes increased $4.5 million, to a benefit of $4.4 million for the six months ended March 31, 2018, from a provision of $0.1 million for the six months ended March 31, 2017, due to a

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