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MarketAxess to Participate in the Raymond James 2025 Institutional Investors Conference

MarketAxess to Participate in the Raymond James 2025 Institutional Investors Conference

NEW YORK–(BUSINESS WIRE)–
MarketAxess Holdings Inc. (Nasdaq: MKTX), the operator of a leading electronic trading platform for fixed-income securities, today announced that Chris Concannon, Chief Executive Officer, will participate in the Raymond James 2025 Institutional Investors Conference on March 3, 2025.

Mr. Concannon will participate in a fireside chat at 4:35 p.m. ET. The live webcast and replay for the fireside chat will be available on the events and presentations section of the MarketAxess Investor Relations homepage, https://investor.marketaxess.com/events-and-presentations.

About MarketAxess

MarketAxess (Nasdaq: MKTX) operates a leading electronic trading platform that delivers greater trading efficiency, a diversified pool of liquidity and significant cost savings to institutional investors and broker-dealers across the global fixed-income markets. Over 2,000 firms leverage MarketAxess’ patented technology to efficiently trade fixed-income securities. MarketAxess’ award-winning Open Trading® marketplace is widely regarded as the preferred all-to-all trading solution in the global credit markets. Founded in 2000, MarketAxess connects a robust network of market participants through an advanced full trading lifecycle solution that includes automated trading solutions, intelligent data and index products and a range of post-trade services. Learn more at www.marketaxess.com and on X @MarketAxess.

INVESTOR RELATIONS

Stephen Davidson

MarketAxess Holdings Inc.

+1 212 813 6313

[email protected]

MEDIA RELATIONS

Marisha Mistry

MarketAxess Holdings Inc.

+1 917 267 1232

[email protected]

KEYWORDS: United States North America New York

INDUSTRY KEYWORDS: Fintech Professional Services Finance

MEDIA:

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Archrock Reports Fourth Quarter and Full Year 2024 Results and Provides 2025 Guidance

HOUSTON, Feb. 24, 2025 (GLOBE NEWSWIRE) — Archrock, Inc. (NYSE: AROC) (“Archrock”) today reported results for the fourth quarter and full year 2024.


Fourth Quarter and Full Year 2024 Highlights

  • Revenue for the fourth quarter of 2024 was $326.4 million compared to $259.6 million in the fourth quarter of 2023. Revenue for 2024 was $1,157.6 million compared to $990.3 million in 2023.
  • Net income for the fourth quarter of 2024 was $59.8 million and EPS was $0.34, compared to $33.0 million and $0.21, respectively, in the fourth quarter of 2023. Net income for 2024 was $172.2 million and EPS was $1.05, compared to $105.0 million and $0.67, respectively, in 2023.
  • Adjusted net income (a non-GAAP measure defined below) for the fourth quarter of 2024 was $61.5 million and adjusted EPS (a non-GAAP measure defined below) was $0.35, compared to $33.0 million and $0.21, respectively, in the fourth quarter of 2023. Adjusted net income for 2024 was $185.2 million and adjusted EPS was $1.13 compared to $105.0 million and $0.67, respectively, in 2023.
  • Adjusted EBITDA (a non-GAAP measure defined below) for the fourth quarter of 2024 was $183.8 million compared to $120.3 million in the fourth quarter of 2023. Adjusted EBITDA for 2024 was $595.4 million compared to $450.4 million in 2023.
  • Declared a quarterly dividend of $0.19 per common share for the fourth quarter of 2024, approximately 15% higher compared to the fourth quarter of 2023, resulting in dividend coverage of 3.5x.


Management Commentary and Outlook

“Archrock’s outstanding fourth quarter performance rounded out a record-setting year of robust utilization and profitability,” said Brad Childers, Archrock’s President and Chief Executive Officer. “For 2024, we increased our contract operations adjusted gross margin by 500 basis points, improved our net income by over 60% and grew our adjusted EBITDA by more than 30% year over year. We maintained a prudent balance sheet, ending the year with a leverage ratio of 3.3x, and returned $124 million in capital to our shareholders through dividends and share buybacks. We achieved these milestones while concurrently completing a transformative acquisition that established our leadership position in electric motor drive compression. 

“We are even more excited about what we are positioned to deliver in 2025. Archrock continues to perform at an exceptional level, reflecting consistent operational execution and the successful progression of our strategic initiatives. Our investment in high-quality assets, excellent customer service and implementation of innovative technology and processes are driving value for our customers and our shareholders.

“Moreover, we see the market opportunities provided by rising energy demand, and in particular, the natural gas required to support growing LNG exports and power generation, continuing into the foreseeable future. With sustained high utilization levels and a large and contracted backlog for 2025, we are booking units for 2026 delivery and believe we will continue to see strong customer demand for new equipment well into next year.

“This impressive and durable investment outlook for Archrock is further underpinned by our financial flexibility and returns-based capital allocation. We are investing in profitable, high-return growth in large midstream and electric motor drive compression to support our high-quality customers in premier, primarily associated gas, plays like the Permian.  We also remain committed to consistent growth in shareholder returns and started the year with a 15% year-over-year increase to our quarterly dividend per share, while maintaining prudent dividend coverage and leverage ratios,” concluded Childers.


Fourth Quarter and Full Year 2024 Financial Results

Archrock’s fourth quarter 2024 net income of $59.8 million included a non-cash long-lived and other asset impairment of $1.2 million, transaction-related costs totaling $2.2 million and a non-cash unrealized decrease in the fair value of our investment in an unconsolidated affiliate of $1.5 million. Archrock’s fourth quarter 2023 net income of $33.0 million included a non-cash long-lived and other asset impairment of $3.7 million and a non-cash unrealized increase in the fair value of our investment in an unconsolidated affiliate of $1.0 million.

Fourth quarter 2024 selling, general, and administrative expenses of $42.2 million compared to $33.0 million for the fourth quarter of 2023 primarily reflect the increase in stock price throughout the year, which drove higher long-term incentive compensation, as well as other increases in performance-based short-term and long-term incentive compensation expense given the outperformance relative to earlier expectations in 2024.

Adjusted EBITDA for the fourth quarter of 2024 and 2023 included $12.7 million and $2.2 million, respectively, in net gains related to the sale of compression and other assets.

Archrock’s full year 2024 net income of $172.2 million included the following items: transaction-related costs totaling $13.2 million, a non-cash long-lived and other asset impairment of $10.7 million, a debt extinguishment loss of $3.2 million, and a non-cash unrealized decrease in the fair value of our investment in an unconsolidated affiliate of $1.5 million. Archrock’s full year 2023 net income of $105.0 million included the following items: a non-cash long-lived and other asset impairment of $12.0 million, restructuring charges of $1.8 million and a non-cash unrealized decrease in the fair value of our investment in an unconsolidated affiliate of $1.0 million.

Adjusted EBITDA for the full year 2024 and 2023 included $17.9 million and $10.2 million, respectively, in net gains related to the sale of compression and other assets.




Contract Operations

For the fourth quarter of 2024, contract operations segment revenue totaled $286.5 million, an increase of 34% compared to $213.0 million in the fourth quarter of 2023. Adjusted gross margin for the fourth quarter of 2024 was $200.2 million, up 46% from $137.1 million. Adjusted gross margin percentage for the fourth quarter of 2024 was 70%, compared to 64% in the fourth quarter of 2023. Total operating horsepower at the end of the fourth quarter of 2024 was 4.2 million compared to 3.6 million at the end of the fourth quarter of 2023. Utilization at the end of the fourth quarter of 2024 was 96%, consistent with the fourth quarter of 2023.




Aftermarket Services

For the fourth quarter of 2024, aftermarket services segment revenue totaled $40.0 million, compared to $46.6 million in the fourth quarter of 2023 due to seasonal delay in service activity. Adjusted gross margin for the fourth quarter of 2024 was $9.1 million, compared to $10.2 million in the fourth quarter of 2023. Adjusted gross margin percentage for the fourth quarter of 2024 was 23%, compared to 22% for the fourth quarter of 2023.


Balance Sheet

Long-term debt was $2.2 billion and our available liquidity totaled $688 million at December 31, 2024. Our leverage ratio was 3.3x as of December 31, 2024, down from 3.5x as of December 31, 2023.


Quarterly Dividend

Our Board of Directors recently declared a quarterly dividend of $0.19 per share of common stock, or $0.70 per share on an annualized basis for the year ended December 31, 2024. Dividend coverage in the fourth quarter of 2024 was 3.5x. The fourth quarter 2024 dividend was paid on February 19, 2025 to stockholders of record at the close of business on February 12, 2025.


2025 Annual Guidance

(in thousands, except percentages, per share amounts, and ratios)

   
Full Year 2025 Guidance
 
   
 
Low
 
 
High
 
Net income (1) (2)   $ 253,000   $ 293,000  
Adjusted EBITDA(3)     750,000     790,000  
Cash available for dividend(4) (5)     456,000     471,000  
               

Segment
 		             
Contract operations revenue   $ 1,200,000   $ 1,235,000  
Contract operations adjusted gross margin percentage     68 %   71 %
Aftermarket services revenue   $ 190,000   $ 210,000  
Aftermarket services adjusted gross margin percentage     22 %   24 %
               
Selling, general and administrative   $ 147,000   $ 142,000  
               

Capital expenditures
 		             
Growth capital expenditures   $ 330,000   $ 370,000  
Maintenance capital expenditures     105,000     115,000  
Other capital expenditures     35,000     50,000  
__________________________________
(1) 2025 annual guidance for net income does not include the impact of long-lived and other asset impairment because due to its nature, it cannot be accurately forecasted. Long-lived and other asset impairment does not impact adjusted EBITDA or cash available for dividend, however it is a reconciling item between these measures and net income. Long-lived and other asset impairment for the years 2024 and 2023 was $10.7 million and $12.0 million, respectively.
(2) Reflects an estimate of expenses to be incurred related to the acquisition of Total Operations and Production Services, LLC (the “TOPS Acquisition”).
(3) Management believes adjusted EBITDA provides useful information to investors because this non-GAAP measure, when viewed with our GAAP results and accompanying reconciliations, provides a more complete understanding of our performance than GAAP results alone. Management uses this non-GAAP measure as a supplemental measure to review current period operating performance, comparability measure and performance measure for period-to-period comparisons.
(4) Management uses cash available for dividend as a supplemental performance measure to compute the coverage ratio of estimated cash flows to planned dividends.
(5) A forward-looking estimate of cash provided by operating activities is not provided because certain items necessary to estimate cash provided by operating activities, including changes in assets and liabilities, are not estimable at this time. Changes in assets and liabilities were $(25.8) million and $(28.0) million for the years 2024 and 2023, respectively.
 


Summary Metrics

(in thousands, except percentages, per share amounts and ratios)

   
Three Months Ended
   
Year Ended
 		 
   
December 31, 
 		 
September 30, 
 		 
December 31, 
 		   
December 31, 
 		 
December 31, 
 		 
   
2024
 		 
2024





 		 
2023
 		   
2024





 		 
2023





 		 
Net income   $ 59,758     $ 37,516     $ 33,002       $ 172,231     $ 104,998    
Adjusted net income (1)   $ 61,533     $ 47,313     $ 33,002       $ 185,211     $ 104,998    
Adjusted EBITDA (1)   $ 183,844     $ 150,854     $ 120,263       $ 595,434     $ 450,387    
                                       
Contract operations revenue   $ 286,466     $ 245,420     $ 213,022       $ 980,405     $ 809,439    
Contract operations adjusted gross margin   $ 200,245     $ 165,610     $ 137,062       $ 657,353     $ 502,691    
Contract operations adjusted gross margin percentage     70   %   67   %   64   %     67   %   62   %
                                       
Aftermarket services revenue   $ 39,950     $ 46,741     $ 46,571       $ 177,186     $ 180,898    
Aftermarket services adjusted gross margin   $ 9,054     $ 12,346     $ 10,239       $ 41,737     $ 38,627    
Aftermarket services adjusted gross margin percentage     23   %   26   %   22   %     24   %   21   %
                                       
Selling, general, and administrative   $ 42,234     $ 34,059     $ 33,007       $ 139,121     $ 116,639    
                                       
Net cash provided by operating activities   $ 124,338     $ 96,900     $ 71,719         429,591       310,187    
Cash available for dividend(1)   $ 118,089     $ 92,887     $ 71,484       $ 364,595     $ 232,979    
Cash available for dividend coverage (2)     3.5   x   3.0   x   2.8   x     3.1   x   2.4   x
                                       
Adjusted free cash flow (1) (3)   $ 68,945     $ (834,282 )   $ 47,385         (730,472 )     77,696    
Adjusted free cash flow after dividend (1) (3)   $ 38,255     $ (862,147 )   $ 23,195         (840,846 )     (18,100 )  
                                       
Total available horsepower (at period end) (4)     4,401       4,418       3,759         4,401       3,759    
Total operating horsepower (at period end) (5)     4,227       4,179       3,607         4,227       3,607    
Horsepower utilization spot (at period end) (6)     96   %   95   %   96   %     96   %   96   %
__________________________________
(1)  Management believes adjusted net income, adjusted EBITDA, cash available for dividend, adjusted free cash flow and adjusted free cash flow after dividend provide useful information to investors because these non-GAAP measures, when viewed with our GAAP results and accompanying reconciliations, provide a more complete understanding of our performance than GAAP results alone. Management uses these non-GAAP measures as supplemental measures to review current period operating performance, comparability measures and performance measures for period-to-period comparisons.
(2)  Defined as cash available for dividend divided by dividends declared for the period.
(3)  Reflects $866.2 million cash paid in TOPS Acquisition, net of cash acquired.
(4)  Defined as idle and operating horsepower and includes new compressor units completed by a third-party manufacturer that have been delivered to us.
(5)  Defined as horsepower that is operating under contract and horsepower that is idle but under contract and generating revenue such as standby revenue.
(6)  Defined as total available horsepower divided by total operating horsepower at period end.
 






Conference Call Details

Archrock will host a conference call on February 25, 2025, to discuss fourth quarter and full year 2024 financial results. The call will begin at 9:00 a.m. Eastern Time.

To listen to the call via a live webcast, please visit Archrock’s website at www.archrock.com. The call will also be available by dialing 1 (800) 715-9871 in the United States or 1 (646) 307-1963 for international calls. The access code is 4749623.

A replay of the webcast will be available on Archrock’s website for 90 days following the event.

Adjusted net income, a non-GAAP measure, is defined as net income (loss) excluding transaction-related costs and debt extinguishment loss adjusted for income taxes. A reconciliation of adjusted net income to net income, the most directly comparable GAAP measure, and a reconciliation of adjusted earnings per share to basic and diluted earnings per common share, the most directly comparable GAAP measure, appear below.

Adjusted EBITDA, a non-GAAP measure, is defined as net income (loss) excluding interest expense, income taxes, depreciation and amortization, long-lived and other asset impairment, unrealized change in fair value of investment in unconsolidated affiliate, restructuring charges, debt extinguishment loss, transaction-related costs, non-cash stock-based compensation expense, amortization of capitalized implementation costs and other items. A reconciliation of adjusted EBITDA to net income, the most directly comparable GAAP measure, and a reconciliation of our full year 2025 adjusted EBITDA guidance to net income appear below.

Adjusted gross margin, a non-GAAP measure, is defined as revenue less cost of sales, exclusive of depreciation and amortization. Adjusted gross margin percentage, a non-GAAP measure, is defined as adjusted gross margin divided by revenue. A reconciliation of adjusted gross margin to net income, the most directly comparable GAAP measure, and a reconciliation of adjusted gross margin percentage to gross margin appear below.

Cash available for dividend, a non-GAAP measure, is defined as net income (loss) excluding interest expense, income taxes, depreciation and amortization, long-lived and other asset impairment, unrealized change in fair value of investment in unconsolidated affiliate, restructuring charges, debt extinguishment loss, transaction-related costs, non-cash stock-based compensation expense, amortization of capitalized implementation costs and other items, less maintenance capital expenditures, other capital expenditures, cash taxes and cash interest expense. Reconciliations of cash available for dividend to net income and net cash provided by operating activities, the most directly comparable GAAP measures, and a reconciliation of our full year 2025 cash available for dividend guidance to net income appear below.

Adjusted free cash flow, a non-GAAP measure, is defined as net cash provided by operating activities plus net cash provided by (used in) investing activities. A reconciliation of adjusted free cash flow to net cash provided by operating activities, the most directly comparable GAAP measure, appears below.

Adjusted free cash flow after dividend, a non-GAAP measure, is defined as net cash provided by operating activities plus net cash provided by (used in) investing activities less dividends paid to stockholders. A reconciliation of adjusted free cash flow after dividend to net cash provided by operating activities, the most directly comparable GAAP measure, appears below.


About Archrock

Archrock is an energy infrastructure company with a primary focus on midstream natural gas compression and a commitment to helping its customers produce, compress and transport natural gas in a safe and environmentally responsible way. Headquartered in Houston, Texas, Archrock is a premier provider of natural gas compression services to customers in the energy industry throughout the U.S. and a leading supplier of aftermarket services to customers that own compression equipment. For more information on how Archrock embodies its purpose, WE POWER A CLEANER AMERICA, visit www.archrock.com.


Forward
–Looking Statements

All statements in this release (and oral statements made regarding the subjects of this release) other than historical facts are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements rely on a number of assumptions concerning future events and are subject to a number of uncertainties and factors that could cause actual results to differ materially from such statements, many of which are outside the control of Archrock. Forward-looking information includes, but is not limited to statements regarding: guidance or estimates related to Archrock’s results of operations or of financial condition; fundamentals of Archrock’s industry, including the attractiveness of returns and valuation, stability of cash flows, demand dynamics and overall outlook, and Archrock’s ability to realize the benefits thereof; Archrock’s expectations regarding future economic, geopolitical and market conditions and trends; Archrock’s operational and financial strategies, including planned growth, coverage and leverage reduction strategies, Archrock’s ability to successfully effect those strategies, and the expected results therefrom; Archrock’s financial and operational outlook; demand and growth opportunities for Archrock’s services; structural and process improvement initiatives, the expected timing thereof, Archrock’s ability to successfully effect those initiatives and the expected results therefrom; the operational and financial synergies provided by Archrock’s size; statements regarding Archrock’s dividend policy; the expected benefits of the TOPS Acquisition, including its expected accretion and the expected impact on Archrock’s leverage ratio; and plans and objectives of management for future operations.

While Archrock believes that the assumptions concerning future events are reasonable, it cautions that there are inherent difficulties in predicting certain important factors that could impact the future performance or results of its business. The factors that could cause results to differ materially from those indicated by such forward-looking statements include, but are not limited to: risks related to macroeconomic conditions, including an increase in inflation and trade tensions; pandemics and other public health crises; ongoing international conflicts and tensions; risks related to our operations; competitive pressures; risks of acquisitions to reduce our ability to make distributions to our common stockholders; inability to make acquisitions on economically acceptable terms; risks related to our sustainability initiatives; uncertainty to pay dividends in the future; risks related to a substantial amount of debt and our debt agreements; inability to access the capital and credit markets or borrow on affordable terms to obtain additional capital; inability to fund purchases of additional compression equipment; vulnerability to interest rate increases; erosion of the financial condition of our customers; risks related to the loss of our most significant customers; uncertainty of the renewals for our contract operations service agreements; risks related to losing management or operational personnel; dependence on particular suppliers and vulnerability to product shortages and price increases; information technology and cybersecurity risks; tax-related risks; legal and regulatory risks, including climate-related and environmental, social and governance risks.

These forward-looking statements are also affected by the risk factors, forward-looking statements and challenges and uncertainties described in Archrock’s Annual Report on Form 10-K for the year ended December 31, 2024, Archrock’s Quarterly Report on Form 10-Q for the quarters ended March 31, 2024, June 30, 2024 and September 30, 2024 and those set forth from time to time in Archrock’s filings with the Securities and Exchange Commission, which are available at www.archrock.com. Except as required by law, Archrock expressly disclaims any intention or obligation to revise or update any forward-looking statements whether as a result of new information, future events or otherwise.


SOURCE: Archrock, Inc.




For information, contact:

Megan Repine
VP of Investor Relations
281-836-8360
[email protected]

 

Archrock, Inc.

Unaudited Condensed Consolidated Statements of Operations
(in thousands, except per share amounts)
                               
   
Three Months Ended
 
Year Ended
   
December 31, 
 		 
September 30, 
 		 
December 31, 
 		 
December 31, 
 		 
December 31, 
   
2024
 		 
2024

  
2023

  
2024

  
2023
Revenue:                              
Contract operations   $ 286,466     $ 245,420     $ 213,022     $ 980,405     $ 809,439  
Aftermarket services     39,950       46,741       46,571       177,186       180,898  
Total revenue     326,416       292,161       259,593       1,157,591       990,337  
                               
Cost of sales, exclusive of depreciation and amortization                              
Contract operations     86,221       79,810       75,960       323,052       306,748  
Aftermarket services     30,896       34,395       36,332       135,449       142,271  
Total cost of sales, exclusive of depreciation and amortization     117,117       114,205       112,292       458,501       449,019  
                               
Selling, general and administrative     42,234       34,059       33,007       139,121       116,639  
Depreciation and amortization     58,129       48,377       42,695       193,194       166,241  
Long-lived and other asset impairment     1,203       2,509       3,658       10,681       12,041  
Restructuring charges     —       —       221       —       1,775  
Debt extinguishment loss     —       3,181       —       3,181       —  
Interest expense     38,238       30,179       27,938       123,610       111,488  
Transaction-related costs     2,247       9,220       —       13,249       —  
Gain on sale of assets, net     (12,712 )     (2,218 )     (2,181 )     (17,887 )     (10,199 )
Other (income) expense, net     1,598       (304 )     (745 )     1,561       1,086  
Income before income taxes     78,362       52,953       42,708       232,380       142,247  
Provision for income taxes     18,604       15,437       9,706       60,149       37,249  
Net income   $ 59,758     $ 37,516     $ 33,002     $ 172,231     $ 104,998  
                               
Basic and diluted net income per common share (1)   $ 0.34     $ 0.22     $ 0.21     $ 1.05     $ 0.67  
                               
Weighted-average common shares outstanding:                              
Basic     173,451       165,847       153,879       162,037       154,126  
Diluted     173,848       166,173       154,177       162,375       154,344  
__________________________________
(1)  Basic and diluted net income per common share is computed using the two-class method to determine the net income per share for each class of common stock and participating security (restricted stock and stock-settled restricted stock units that have non-forfeitable rights to receive dividends or dividend equivalents) according to dividends declared and participation rights in undistributed earnings. Accordingly, we have excluded net income attributable to participating securities from our calculation of basic and diluted net income per common share.
 


Archrock, Inc.

Unaudited Supplemental Information
(in thousands, except percentages, per share amounts and ratios)
                                   
   
Three Months Ended
     
Year Ended
 		 
   
December 31, 
 		 
September 30, 
 		 
December 31, 
 		   
December 31, 
 		 
December 31, 
 		 
   
2024
 		 
2024

  
2023

    
2024

  
2023

  
Revenue:                                  
Contract operations   $ 286,466     $ 245,420     $ 213,022       $ 980,405     $ 809,439    
Aftermarket services     39,950       46,741       46,571         177,186       180,898    
Total revenue   $ 326,416     $ 292,161     $ 259,593       $ 1,157,591     $ 990,337    
                                   
Adjusted gross margin:                                  
Contract operations   $ 200,245     $ 165,610     $ 137,062       $ 657,353     $ 502,691    
Aftermarket services     9,054       12,346       10,239         41,737       38,627    
Total adjusted gross margin (1)   $ 209,299     $ 177,956     $ 147,301       $ 699,090     $ 541,318    
                                   
Adjusted gross margin percentage:                                  
Contract operations     70   %   67   %   64   %     67   %   62   %
Aftermarket services     23   %   26   %   22   %     24   %   21   %
Total adjusted gross margin percentage (1)     64   %   61   %   57   %     60   %   55   %
                                   
Selling, general and administrative   $ 42,234     $ 34,059     $ 33,007       $ 139,121     $ 116,639    
% of revenue     13   %   12   %   13   %     12   %   12   %
                                   
Adjusted EBITDA (1)   $ 183,844     $ 150,854     $ 120,263       $ 595,434     $ 450,387    
% of revenue     56   %   52   %   46   %     51   %   45   %
                                   
Capital expenditures   $ 97,988     $ 70,018     $ 36,655       $ 359,032     $ 298,632    
Proceeds from sale of property, plant and equipment and other assets     (43,387 )     (6,654 )     (17,543 )       (67,591 )     (72,206 )  
Net capital expenditures   $ 54,601     $ 63,364     $ 19,112       $ 291,441     $ 226,426    
                                   
Total available horsepower (at period end) (2)     4,401       4,418       3,759         4,401       3,759    
Total operating horsepower (at period end) (3)     4,227       4,179       3,607         4,227       3,607    
Average operating horsepower     4,205       3,757       3,607         3,794       3,554    
Horsepower utilization:                                  
Spot (at period end) (4)     96   %   95   %   96   %     96   %   96   %
Average (4)     95   %   95   %   96   %     95   %   95   %
                                   
Dividend declared for the period per share   $ 0.190     $ 0.175     $ 0.165       $ 0.695     $ 0.625    
Dividend declared for the period to all stockholders   $ 33,487     $ 30,656     $ 25,913       $ 117,861     $ 97,857    
Cash available for dividend coverage (5)     3.5   x   3.0   x   2.8   x     3.1   x   2.4   x
                                   
Adjusted free cash flow (1) (6)   $ 68,945     $ (834,282 )   $ 47,385       $ (730,472 )   $ 77,696    
Adjusted free cash flow after dividend (1)(6)   $ 38,255     $ (862,147 )   $ 23,195       $ (840,846 )   $ (18,100 )  
__________________________________
(1) Management believes adjusted gross margin, adjusted EBITDA, adjusted free cash flow and adjusted free cash flow after dividend provide useful information to investors because these non-GAAP measures, when viewed with our GAAP results and accompanying reconciliations, provide a more complete understanding of our performance than GAAP results alone. Management uses these non-GAAP measures as supplemental measures to review current period operating performance, comparability measures and performance measures for period-to-period comparisons.
(2) Defined as idle and operating horsepower and includes new compressor units completed by a third-party manufacturer that have been delivered to us.
(3) Defined as horsepower that is operating under contract and horsepower that is idle but under contract and generating revenue such as standby revenue.
(4) Defined as total available horsepower divided by total operating horsepower at period end (spot) or over time (average).
(5) Defined as cash available for dividend divided by dividends declared for the period.
(6) Reflects $866.2 million cash paid in TOPS Acquisition, net of cash acquired.

 
 
December 31, 
 
September 30, 
 
December 31, 
 
    
2024
    
2024
    
2023

Balance Sheet
 		                 
Long-term debt (1)   $ 2,198,376   $ 2,236,131   $ 1,584,869
Total equity     1,323,531     1,290,736     871,021
__________________________________
(1)  Carrying values are shown net of unamortized premium and deferred financing costs.
 


Archrock, Inc.

Unaudited Supplemental Information



Reconciliation of Net Income to Adjusted Net Income and Earnings Per Share to Adjusted Earnings Per Share


(in thousands, except per share amounts)
                                   

 
 		 
Three Months Ended
 
Year Ended

 
 		 
December 31, 
 		 
September 30, 
 		 
December 31, 
 		 
December 31, 
 		 
December 31, 

 
 		 
2024

  
2024

  
2023
 		 
2024

  
2023
Net income   $ 59,758     $ 37,516     $ 33,002     $ 172,231     $ 104,998  
Transaction-related costs     2,247       9,220       —       13,249       —  
Debt extinguishment loss     —       3,181       —       3,181       —  
Tax effect of adjustments (1)     (472 )     (2,604 )     —       (3,450 )     —  
Adjusted net income (2)   $ 61,533     $ 47,313     $ 33,002     $ 185,211     $ 104,998  
                                   
Weighted-average common shares outstanding used in diluted earnings per common share     173,451       166,173       154,401       162,037       154,344  
                                   
Basic and diluted earnings per common share (3)   $ 0.34     $ 0.22     $ 0.21       1.05       0.67  
Transaction-related costs per share     0.01       0.06       —       0.08       —  
Debt extinguishment loss per share     —       0.02       —       0.02       —  
Tax effect of adjustments per share     (0.00 )     (0.02 )     —       (0.02 )     —  
Adjusted earnings per share (2)   $ 0.35     $ 0.28     $ 0.21     $ 1.13     $ 0.67  
__________________________________
(1) Represents tax effect of transaction-related costs and debt extinguishment loss based on statutory tax rate.
(2) Management believes adjusted net income and adjusted earnings per share provides useful information to investors because these non-GAAP measures, when viewed with our GAAP results and accompanying reconciliations, provide a more complete understanding of our performance than GAAP results alone. Management uses these non-GAAP measures as supplemental measures to review our current period operating performance, comparability measure and performance measure for period-to-period comparisons without burdened earnings and earnings per share for non-recurring transactional costs.
(3) Basic and diluted net income per common share is computed using the two-class method to determine the net income per share for each class of common stock and participating security (restricted stock and stock-settled restricted stock units that have non-forfeitable rights to receive dividends or dividend equivalents) according to dividends declared and participation rights in undistributed earnings. Accordingly, we have excluded net income attributable to participating securities from our calculation of basic and diluted net income per common share.
 


Archrock, Inc.

Unaudited Supplemental Information

Reconciliation of Net Income to Adjusted EBITDA and Adjusted Gross Margin
(in thousands)
                               

 
 		 
Three Months Ended
 
Year Ended

 
 		 
December 31, 
 		 
September 30, 
 		 
December 31, 
 		 
December 31, 
 		 
December 31, 

 
 		 
2024

  
2024

  
2023

  
2024

  
2023
Net income   $ 59,758     $ 37,516     $ 33,002     $ 172,231     $ 104,998  
Depreciation and amortization     58,129       48,377       42,695       193,194       166,241  
Long-lived and other asset impairment     1,203       2,509       3,658       10,681       12,041  
Unrealized change in fair value of investment in unconsolidated affiliate     1,484       —       (1,023 )     1,484       973  
Restructuring charges     —             221       —       1,775  
Debt extinguishment loss     —       3,181       —       3,181       —  
Interest expense     38,238       30,179       27,938       123,610       111,488  
Transaction-related costs     2,247       9,220       —       13,249       —  
Stock-based compensation expense     3,431       3,738       3,283       14,646       12,998  
Amortization of capitalized implementation costs     750       697       783       3,009       2,624  
Provision for income taxes     18,604       15,437       9,706       60,149       37,249  
Adjusted EBITDA (1)     183,844       150,854       120,263       595,434       450,387  
Selling, general and administrative     42,234       34,059       33,007       139,121       116,639  
Stock-based compensation expense     (3,431 )     (3,738 )     (3,283 )     (14,646 )     (12,998 )
Amortization of capitalized implementation costs     (750 )     (697 )     (783 )     (3,009 )     (2,624 )
Gain on sale of assets, net     (12,712 )     (2,218 )     (2,181 )     (17,887 )     (10,199 )
Other (income) expense, net     1,598       (304 )     (745 )     1,561       1,086  
Adjusted gross margin (1)   $ 209,299     $ 177,956     $ 147,301     $ 699,090     $ 541,318  
__________________________________
(1)  Management believes adjusted EBITDA and adjusted gross margin provide useful information to investors because these non-GAAP measures, when viewed with our GAAP results and accompanying reconciliations, provide a more complete understanding of our performance than GAAP results alone. Management uses these non-GAAP measures as supplemental measures to review current period operating performance, comparability measures and performance measures for period-to-period comparisons.
 


Archrock, Inc.

Unaudited Supplemental Information

Reconciliation of Total Revenue to Adjusted Gross Margin
(in thousands)
                                         

 
 		 
Three Months Ended
 
Year Ended

 
 		 
December 31, 
 		 
September 30, 
 		 
December 31, 
 		 
December 31, 
 		 
December 31, 

 
 		 
2024

  
2024

  
2023

  
2024

  
2023
Total revenues   $ 326,416       $ 292,161       $ 259,593       $ 1,157,591       $ 990,337    
Cost of sales, exclusive of depreciation and amortization     (117,117 )       (114,205 )       (112,292 )       (458,501 )       (449,019 )  
Depreciation and amortization     (58,129 )       (48,377 )       (42,695 )       (193,194 )       (166,241 )  
Gross margin     151,170   46 %     129,579   44 %     104,606   40 %     505,896   44 %     375,077   38 %
Depreciation and amortization     58,129         48,377         42,695         193,194         166,241    
Adjusted gross margin (1)   $ 209,299   64 %   $ 177,956   61 %   $ 147,301   57 %   $ 699,090   60 %     541,318   55 %
__________________________________
(1) Management believes adjusted gross margin provides useful information to investors because this non-GAAP measure, when viewed with our GAAP results and accompanying reconciliations, provides a more complete understanding of our performance than GAAP results alone. Management uses this non-GAAP measure as a supplemental measure to review current period operating performance, comparability measures and performance measures for period-to-period comparisons.
 


Archrock, Inc.

Unaudited Supplemental Information

Reconciliation of Net Income to Adjusted EBITDA and Cash Available for Dividend
(in thousands)
                               

 
 		 
Three Months Ended
 
Year Ended

 
 		 
December 31, 
 		 
September 30, 
 		 
December 31, 
 		 
December 31, 
 		 
December 31, 

 
 		 
2024

  
2024

  
2023

  
2024

  
2023
Net income   $ 59,758     $ 37,516     $ 33,002     $ 172,231     $ 104,998  
Depreciation and amortization     58,129       48,377       42,695       193,194       166,241  
Long-lived and other asset impairment     1,203       2,509       3,658       10,681       12,041  
Unrealized change in fair value of investment in unconsolidated affiliate     1,484       —       (1,023 )     1,484       973  
Restructuring charges     —       —       221       —       1,775  
Debt extinguishment loss     —       3,181       —       3,181       —  
Interest expense     38,238       30,179       27,938       123,610       111,488  
Transaction-related costs     2,247       9,220       —       13,249        
Stock-based compensation expense     3,431       3,738       3,283       14,646       12,998  
Amortization of capitalized implementation costs     750       697       783       3,009       2,624  
Provision for income taxes     18,604       15,437       9,706       60,149       37,249  
Adjusted EBITDA (1)     183,844       150,854       120,263       595,434       450,387  
Less: Maintenance capital expenditures     (21,623 )     (21,190 )     (18,156 )     (87,753 )     (92,168 )
Less: Other capital expenditures     (7,023 )     (6,945 )     (3,193 )     (20,333 )     (16,164 )
Less: Cash tax (payment) refund     134       (404 )     (120 )     (2,209 )     (1,311 )
Less: Cash interest expense     (37,243 )     (29,428 )     (27,310 )     (120,544 )     (107,765 )
Cash available for dividend (2)   $ 118,089     $ 92,887     $ 71,484     $ 364,595     $ 232,979  
__________________________________
(1)  Management believes adjusted EBITDA provides useful information to investors because this non-GAAP measure, when viewed with our GAAP results and accompanying reconciliations, provides a more complete understanding of our performance than GAAP results alone. Management uses this non-GAAP measure as a supplemental measure to review current period operating performance, comparability measure and performance measure for period-to-period comparisons.
(2)  Management uses cash available for dividend as a supplemental performance measure to compute the coverage ratio of estimated cash flows to planned dividends.
 


Archrock, Inc.

Unaudited Supplemental Information

Reconciliation of Net Cash Provided by Operating Activities to Cash Available for Dividend
(in thousands)
                               

 
 		 
Three Months Ended
 
Year Ended

 
 		 
December 31, 
 		 
September 30, 
 		 
December 31, 
 		 
December 31, 
 		 
December 31, 

 
 		 
2024

  
2024

  
2023

  
2024

  
2023
Net cash provided by operating activities   $ 124,338     $ 96,900     $ 71,719     $ 429,591     $ 310,187  
Inventory write-downs     18       (51 )     (164 )     (550 )     (545 )
Provision for credit losses     (286 )     (90 )     (458 )     (381 )     (224 )
Gain on sale of assets, net     12,712       2,218       2,181       17,887       10,199  
Current income tax (benefit) provision     997       (146 )     459       2,059       1,591  
Cash tax (payment) refund     134       (404 )     (120 )     (2,209 )     (1,311 )
Amortization of operating lease ROU assets     (1,063 )     (962 )     (831 )     (3,852 )     (3,319 )
Amortization of contract costs     (6,106 )     (6,046 )     (5,653 )     (23,877 )     (21,289 )
Deferred revenue recognized in earnings     5,294       4,101       5,421       15,001       16,464  
Cash restructuring charges     —       —       211       —       1,554  
Transaction-related costs     2,247       9,220       —       13,249       —  
Changes in assets and liabilities     8,450       16,282       20,068       25,763       28,004  
Maintenance capital expenditures     (21,623 )     (21,190 )     (18,156 )     (87,753 )     (92,168 )
Other capital expenditures     (7,023 )     (6,945 )     (3,193 )     (20,333 )     (16,164 )
Cash available for dividend (1)   $ 118,089     $ 92,887     $ 71,484     $ 364,595     $ 232,979  
__________________________________
(1)  Management uses cash available for dividend as a supplemental performance measure to compute the coverage ratio of estimated cash flows to planned dividends.
 


Archrock, Inc.

Unaudited Supplemental Information

Reconciliation of Net Cash Provided By Operating Activities to Adjusted Free Cash Flow

and Adjusted Free Cash Flow After Dividend
(in thousands)
                               

 
 		 
Three Months Ended
 
Year Ended

 
 		 
December 31, 
 		 
September 30, 
 		 
December 31, 
 		 
December 31, 
 		 
December 31, 

 
 		 
2024

  
2024

  
2023

  
2024

  
2023
Net cash provided by operating activities   $ 124,338     $ 96,900     $ 71,719     $ 429,591     $ 310,187  
Net cash used in investing activities (1)     (55,393 )     (931,182 )     (24,334 )     (1,160,063 )     (232,491 )
Adjusted free cash flow (1) (2)     68,945       (834,282 )     47,385       (730,472 )     77,696  
Dividends paid to stockholders     (30,690 )     (27,865 )     (24,190 )     (110,374 )     (95,796 )
Adjusted free cash flow after dividend (1) (2)   $ 38,255     $ (862,147 )   $ 23,195     $ (840,846 )   $ (18,100 )
__________________________________
(1)  Reflects $866.2 million cash paid in TOPS Acquisition, net of cash acquired.
(2)  Management believes adjusted free cash flow and adjusted free cash flow after dividend provide useful information to investors because these non-GAAP measures, when viewed with our GAAP results and accompanying reconciliations, provide a more complete understanding of our performance than GAAP results alone. Management uses these non-GAAP measures as supplemental measures to review current period operating performance, comparability measures and performance measures for period-to-period comparisons.
 


Archrock, Inc.

Unaudited Supplemental Information

Reconciliation of Net Income to Adjusted EBITDA and Cash Available for Dividend Guidance
(in thousands)
             

 
 		 
Annual Guidance Range

 
 		 
2025

 
 		 
Low
 		 
High
Net income (1)   $ 253,000     $ 293,000  
Interest expense     153,000       153,000  
Provision for income taxes     101,000       101,000  
Depreciation and amortization     219,000       219,000  
Stock-based compensation expense     15,000       15,000  
Amortization of capitalized implementation costs     4,000       4,000  
Transaction-related costs (2)     5,000       5,000  
Adjusted EBITDA (3)     750,000       790,000  
Less: Maintenance capital expenditures     (105,000 )     (115,000 )
Less: Other capital expenditures     (35,000 )     (50,000 )
Less: Cash tax expense     (7,000 )     (7,000 )
Less: Cash interest expense     (147,000 )     (147,000 )
Cash available for dividend (4)(5)   $ 456,000     $ 471,000  
__________________________________
(1) 2025 annual guidance for net income does not include the impact of long-lived and other asset impairment because due to its nature, it cannot be accurately forecasted. Long-lived and other asset impairment does not impact Adjusted EBITDA or cash available for dividend, however it is a reconciling item between these measures and net income. Long-lived and other asset impairment for the years 2024 and 2023 was $10.7 million and $12.0 million, respectively.
(2) Reflects an estimate of expenses to be incurred related to the TOPS acquisition.
(3) Management believes adjusted EBITDA provides useful information to investors because this non-GAAP measure, when viewed with our GAAP results and accompanying reconciliations, provides a more complete understanding of our performance than GAAP results alone. Management uses this non-GAAP measure as a supplemental measure to review current period operating performance, comparability measure and performance measure for period-to-period comparisons.
(4) Management uses cash available for dividend as a supplemental performance measure to compute the coverage ratio of estimated cash flows to planned dividends.
(5) A forward-looking estimate of cash provided by operating activities is not provided because certain items necessary to estimate cash provided by operating activities, including changes in assets and liabilities, are not estimable at this time. Changes in assets and liabilities were $(25.8) million and $(28.0) million for the years 2024 and 2023, respectively.



Posted on

Helix Reports Fourth Quarter and Full Year 2024 Results

Helix Reports Fourth Quarter and Full Year 2024 Results

HOUSTON–(BUSINESS WIRE)–
Helix Energy Solutions Group, Inc. (“Helix”) (NYSE: HLX) reported net income of $20.1 million, or $0.13 per diluted share, for the fourth quarter 2024 compared to net income of $29.5 million, or $0.19 per diluted share, for the third quarter 2024 and a net loss of $28.3 million, or $(0.19) per diluted share, for the fourth quarter 2023. Net loss in the fourth quarter 2023 includes a net pre-tax loss of approximately $37.3 million related to the repurchase of $159.8 million principal amount of our former Convertible Senior Notes due 2026 (“2026 Notes”). Helix reported adjusted EBITDA1 of $71.6 million for the fourth quarter 2024 compared to $87.6 million for the third quarter 2024 and $70.6 million for the fourth quarter 2023.

For the full year 2024, Helix reported net income of $55.6 million, or $0.36 per diluted share, compared to a net loss of $10.8 million, or $(0.07) per diluted share, for the full year 2023. Net income in 2024 included a pre-tax loss of $20.9 million related to the retirement of the 2026 Notes, and the net loss in 2023 included pre-tax losses of $37.3 million related to the repurchase of $159.8 million principal amount of the 2026 Notes and $42.2 million related to the increase in the fair value of the contingent consideration related to the Alliance acquisition. Adjusted EBITDA for the full year 2024 was $303.1 million compared to $273.4 million for the full year 2023. The table below summarizes our results of operations:

Summary of Results

($ in thousands, except per share amounts, unaudited)
 
Three Months Ended Year Ended
12/31/2024 12/31/2023 9/30/2024 12/31/2024 12/31/2023
Revenues

$

355,133

 

$

335,157

 

$

342,419

 

$

1,358,560

 

$

1,289,728

 
Gross Profit

$

58,859

 

$

49,278

 

$

65,665

 

$

219,564

 

$

200,356

 

 

17%

 

15%

 

19%

 

16%

 

16%
Net Income (Loss)

$

20,121

 

$

(28,333

)

$

29,514

 

$

55,637

 

$

(10,838

)
Basic Earnings (Loss) Per Share

$

0.13

 

$

(0.19

)

$

0.19

 

$

0.37

 

$

(0.07

)
Diluted Earnings (Loss) Per Share

$

0.13

 

$

(0.19

)

$

0.19

 

$

0.36

 

$

(0.07

)
Adjusted EBITDA1

$

71,641

 

$

70,632

 

$

87,621

 

$

303,147

 

$

273,403

 
Cash and Cash Equivalents

$

368,030

 

$

332,191

 

$

324,120

 

$

368,030

 

$

332,191

 
Net Debt1

$

(52,873

)

$

29,531

 

$

(9,447

)

$

(52,873

)

$

29,531

 
Cash Flows from Operating Activities

$

77,977

 

$

94,737

 

$

55,731

 

$

186,028

 

$

152,457

 
Free Cash Flow1

$

65,454

 

$

91,878

 

$

52,645

 

$

163,188

 

$

133,798

 
 

1 Adjusted EBITDA, Net Debt and Free Cash Flow are non-GAAP measures; see non-GAAP reconciliations below

Owen Kratz, President and Chief Executive Officer of Helix, stated, “Our full-year results for 2024 reflect our third consecutive year of revenue and EBITDA growth, with our highest EBITDA since 2014, despite a pull-back in our Shallow Water Abandonment segment. Our Free Cash Flow is the highest in two decades and would have been even higher absent the $58 million earnout payment included in our operating cash flows. Our Well Intervention and Robotics businesses continue to generate strong results, with high levels of utilization and improving rates. We completed the restructuring of our balance sheet with the retirement of our remaining convertible notes during the year, and we ended the year in a strong financial position, with significant cash levels and negative net debt. Based on the strength of this market and the value we bring to our customers, we signed new awards that provide over half of our well intervention fleet with contracted work for multiple years as we enter 2025 with strong contract coverage with expected significant improvements over 2024. We continue to execute on our capital allocation framework, and we’ve now repurchased over $40 million in our shares and expect to increase repurchases in 2025.”

Segment Information, Operational and Financial Highlights

($ in thousands, unaudited)
 
Three Months Ended Year Ended
12/31/2024 12/31/2023 9/30/2024 12/31/2024 12/31/2023
Revenues:
Well Intervention

$

226,188

 

$

203,866

 

$

174,613

 

$

829,862

 

$

707,718

 
Robotics

 

81,594

 

 

62,957

 

 

84,526

 

 

297,678

 

 

257,875

 
Shallow Water Abandonment

 

37,690

 

 

61,995

 

 

71,595

 

 

186,979

 

 

274,954

 
Production Facilities

 

18,462

 

 

19,383

 

 

20,695

 

 

88,709

 

 

87,885

 
Intercompany Eliminations

 

(8,801

)

 

(13,044

)

 

(9,010

)

 

(44,668

)

 

(38,704

)
Total

$

355,133

 

$

335,157

 

$

342,419

 

$

1,358,560

 

$

1,289,728

 
 
Income (Loss) from Operations:
Well Intervention

$

29,118

 

$

21,041

 

$

16,109

 

$

93,205

 

$

32,398

 
Robotics

 

19,335

 

 

9,224

 

 

24,158

 

 

77,343

 

 

52,450

 
Shallow Water Abandonment

 

(5,422

)

 

12,032

 

 

8,808

 

 

(9,323

)

 

66,240

 
Production Facilities

 

5,498

 

 

(985

)

 

8,288

 

 

21,340

 

 

20,832

 
Change in Fair Value of Contingent Consideration

 

–

 

 

(10,927

)

 

–

 

 

–

 

 

(42,246

)
Corporate / Other / Eliminations

 

(17,651

)

 

(15,005

)

 

(12,723

)

 

(55,130

)

 

(66,164

)
Total

$

30,878

 

$

15,380

 

$

44,640

 

$

127,435

 

$

63,510

 
 

Fourth Quarter Results

Segment Results

Well Intervention

Well Intervention revenues increased $51.6 million, or 30%, during the fourth quarter 2024 compared to the prior quarter primarily due to a fewer number of transit and mobilization days and higher day rates compared to the prior quarter. During the fourth quarter 2024, the Q4000 incurred 58 fewer days of mobilization and transit compared to the prior quarter, a period during which mobilization revenues and costs were deferred and not recognized. The Q4000 completed its mobilization for its Nigeria campaign and commenced operations at higher rates in early October 2024, and the Q7000 generated higher rates during the fourth quarter 2024 compared to the prior quarter prior to commencing its transit to Brazil early November 2024. Revenues also increased quarter over quarter due to a contract cancellation for work scheduled in 2025 of approximately $14 million in our North Sea operations, as well as higher rates and utilization on the Siem Helix 1, which commenced its contract extension with Trident in Brazil at higher rates during the fourth quarter 2024. Revenue increases were offset in part by low seasonal utilization on our North Sea vessels, which were nearly fully utilized during the prior quarter, and lower utilization on the Siem Helix 2, which commenced its vessel acceptance period at the end of December on its new contract with Petrobras. Overall Well Intervention vessel utilization was 79% during the fourth quarter 2024 compared to 97% during the prior quarter. Well Intervention operating income increased $13.0 million during the fourth quarter 2024 compared to the prior quarter. The increase was due primarily to the contract cancellation fee in addition to improvements in operating income on the Q4000 and the Siem Helix 1 being mostly offset by idle vessel-related costs in the North Sea.

Well Intervention revenues increased $22.3 million, or 11%, during the fourth quarter 2024 compared to the fourth quarter 2023. The increase was due to the contract cancellation fee in addition to higher rates on the Q4000, Q7000 and Siem Helix 1, offset in part primarily by lower revenues on the Q5000 during the fourth quarter 2024. The Q4000 and the Q7000 generated higher rates during the fourth quarter 2024 compared to the same quarter in 2023. Additionally during the fourth quarter 2024, the Siem Helix 1 commenced its contract extension with Trident in Brazil at higher rates. Fourth quarter 2024 utilization was lower on our North Sea vessels, which were fully utilized during the fourth quarter 2023, and with the Siem Helix 2 commencing its vessel acceptance period at the end of December. Revenues on the Q5000 were also lower due to the vessel working at lower legacy rates during the fourth quarter 2024. There were a similar number of mobilization and transit days during both the fourth quarters 2024 and 2023. Overall Well Intervention vessel utilization decreased to 79% during the fourth quarter 2024 compared to 95% during the fourth quarter 2023. Well Intervention operating income increased $8.1 million during the fourth quarter 2024 compared to the fourth quarter 2023, primarily due to the contract cancellation fee and higher margins on the Q7000 Australia operations, offset in part by idle vessel costs in the North Sea and lower margins on the Q5000.

Robotics

Robotics revenues decreased $2.9 million, or 3%, during the fourth quarter 2024 compared to the prior quarter. The decrease in revenues was due to lower overall vessel, trenching and ROV utilization, offset in part by an increase in integrated vessel trenching days compared to the prior quarter. Chartered vessel activity decreased to 508 days, or 98%, during the fourth quarter 2024 compared to 532 days, or 96%, during the prior quarter. ROV and trencher utilization decreased to 64% during the fourth quarter 2024 compared to 77% during the prior quarter. Integrated vessel trenching increased to 269 days during the fourth quarter 2024 compared to 249 days during the prior quarter. The i-Plough had 26 days of utilization on a third-party vessel and the IROV boulder grab had 65 days of utilization during the fourth quarter 2024, whereas the i-Plough and the IROV boulder grab each had 92 days of utilization during the prior quarter. Robotics operating income decreased $4.8 million during the fourth quarter 2024 compared to the prior quarter primarily due to lower revenue and project demobilization costs incurred related to two vessels during the fourth quarter.

Robotics revenues increased $18.6 million, or 30%, during the fourth quarter 2024 compared to the fourth quarter 2023. The increase in revenues was primarily due to higher rates on our vessels and ROVs and higher vessel activities, offset by lower ROV utilization during the fourth quarter 2024. Chartered vessel activity increased to 508 days, or 98%, during the fourth quarter 2024 compared to 463 days, or 97%, during the fourth quarter 2023. Integrated vessel trenching remained relatively flat with 269 days during the fourth quarter 2024 compared to 271 days during the fourth quarter 2023, and the fourth quarter 2024 included 26 days of utilization on the i-Plough trencher on a third-party vessel and 65 days of utilization on the IROV boulder grab, whereas the i-Plough and IROV were idle during the fourth quarter 2023. Overall ROV and trencher utilization decreased to 64% during the fourth quarter 2024 compared to 68% during the fourth quarter 2023. Robotics operating income increased $10.1 million during the fourth quarter 2024 primarily due to higher revenues compared to the fourth quarter 2023.

Shallow Water Abandonment

Shallow Water Abandonment revenues decreased $33.9 million, or 47%, during the fourth quarter 2024 compared to the prior quarter. The decrease in revenues was due to the seasonal decrease in vessel and system utilization during the fourth quarter 2024. Vessel utilization (excluding heavy lift) decreased to 65% during the fourth quarter 2024 compared to 76% during the prior quarter. Plug and Abandonment (“P&A”) and Coiled Tubing (“CT”) systems activity declined to 416 days, or 17% utilization, during the fourth quarter 2024 compared to 607 days, or 25% utilization, during the prior quarter. The Epic Hedron heavy lift barge had 41% utilization during the fourth quarter 2024 compared to 88% during the prior quarter. Shallow Water Abandonment operating income decreased $14.2 million during the fourth quarter 2024 compared to the prior quarter primarily due to lower revenues during the fourth quarter 2024.

Shallow Water Abandonment revenues decreased $24.3 million, or 39%, during the fourth quarter 2024 compared to the fourth quarter 2023 due to lower vessel and system utilization during the fourth quarter 2024. Vessel utilization (excluding heavy lift) was 65% during the fourth quarter 2024 compared to 71% during the fourth quarter 2023. P&A and CT systems utilization declined to 416 days, or 17%, during the fourth quarter 2024 compared to 1,386 days of utilization, or 58%, during the fourth quarter 2023. The Epic Hedron heavy lift barge had 41% utilization during the fourth quarter 2024 compared to 76% utilization during the fourth quarter 2023. Shallow Water Abandonment operating income decreased $17.5 million during the fourth quarter 2024 compared to the fourth quarter 2023 primarily due to lower revenues.

Production Facilities

Production Facilities revenues decreased $2.2 million, or 11%, during the fourth quarter 2024 compared to the prior quarter primarily due to lower oil and gas production and prices during the fourth quarter. Oil and gas production declined quarter over quarter due to no production from the Thunder Hawk wells, which had one month of production in the prior quarter before being shut in, and an unplanned shut-in of the Droshky wells during October 2024, which had a full quarter of production during the prior quarter. Production Facilities operating income decreased $2.8 million during the fourth quarter 2024 compared to the prior quarter primarily due to lower revenues during the fourth quarter 2024.

Production Facilities revenues decreased $0.9 million, or 5%, during the fourth quarter 2024 compared to the fourth quarter 2023 primarily due to lower oil and gas production and prices during the fourth quarter 2024. Oil and gas production declined during the fourth quarter 2024 due to an unplanned shut-in of the Droshky wells during October 2024. The Thunder Hawk wells were shut-in during both the fourth quarters 2024 and 2023. Production Facilities operating income increased $6.5 million during the fourth quarter 2024 compared to the fourth quarter 2023 primarily due to the incurrence of well workover costs related to the Thunder Hawk wells at the end of the fourth quarter 2023.

Selling, General and Administrative and Other

Selling, General and Administrative

Selling, general and administrative expenses were $27.6 million, or 7.8% of revenue, during the fourth quarter 2024 compared to $21.1 million, or 6.2% of revenue, during the prior quarter and $23.0 million, or 6.9% of revenue, during the fourth quarter 2023. The increase in expenses during the fourth quarter 2024 was primarily due to higher compensation costs compared to the prior quarter and prior year.

Other Income and Expenses

Other expense, net was $1.3 million during the fourth quarter 2024 compared to $0.0 million during the prior quarter and other income, net of $7.0 million during the fourth quarter 2023. Other expense, net in the fourth quarter 2024 primarily included foreign currency losses related to the approximate 6% depreciation of the British pound. Other income, net during the fourth quarter 2023 primarily includes foreign currency gains related to the approximate 4% appreciation in the British pound, offset in part by losses on conversions of our Nigerian naira into dollars.

Change in Fair Value of Contingent Consideration

Change in fair value of contingent consideration of $10.9 million during the fourth quarter 2023 was related to our acquisition of Alliance and reflected an increase in the fair value during the fourth quarter 2023 of the estimated earnout, which was paid in April 2024.

Cash Flows

Operating cash flows were $78.0 million during the fourth quarter 2024 compared to $55.7 million during the prior quarter and $94.7 million during the fourth quarter 2023. Fourth quarter 2024 operating cash flows increased compared to the prior quarter primarily due to working capital inflows during the fourth quarter 2024 compared to outflows during the prior quarter and lower regulatory certification costs on our vessels and systems, offset in part by lower earnings during the fourth quarter 2024. Fourth quarter 2024 operating cash flows decreased compared to the fourth quarter 2023 primarily due to higher regulatory certification costs on our vessels and systems, and lower working capital inflows during the fourth quarter 2024. Regulatory certifications for our vessels and systems, which are included in operating cash flows, were $6.1 million during the fourth quarter 2024 compared to $8.9 million during the prior quarter and $3.3 million during the fourth quarter 2023.

Capital expenditures, which are included in investing cash flows, totaled $12.5 million during the fourth quarter 2024 compared to $3.2 million during the prior quarter and $3.4 million during the fourth quarter 2023. Free Cash Flow was $65.5 million during the fourth quarter 2024 compared to $52.6 million during the prior quarter and $91.9 million during the fourth quarter 2023. The increase in Free Cash Flow in the fourth quarter 2024 compared to the prior quarter was due primarily to higher operating cash flows, offset in part by higher capital expenditures, during the fourth quarter 2024. The decrease in Free Cash Flow in the fourth quarter 2024 compared to the fourth quarter 2023 was due to lower operating cash flow and higher capital expenditures during the fourth quarter 2024. (Free Cash Flow is a non-GAAP measure. See reconciliation below.)

Full Year Results

Segment Results

Well Intervention

Well Intervention revenues increased $122.1 million, or 17%, in 2024 compared to 2023 due primarily to overall higher rates and utilization in 2024. U.S. Gulf Coast utilization improved in 2024 following a higher number of regulatory docking days during 2023 on the Q4000 and Q5000 vessels. Revenues on the Q7000 also increased during 2024 as the vessel incurred fewer transit and mobilization days in 2024 compared to 2023, and the vessel generated higher integrated project revenues on its Australia campaign during 2024 compared to the rates generated in New Zealand in 2023. During transit and mobilization periods, mobilization revenues and costs are deferred and not recognized. Revenues in Brazil improved primarily due to the transition of the Siem Helix 1 to its improved contracted rates with Trident during the fourth quarter 2024. North Sea revenues increased with year-over-year improvements in rates on both vessels and the recognition of a contract cancellation fee, offset in part by the return to lower winter seasonal utilization and the regulatory docking of the Well Enhancer during 2024, whereas both vessels had high utilization in 2023. Overall Well Intervention vessel utilization increased to 90% during 2024 compared to 88% in 2023. Well Intervention operating income increased $60.8 million during 2024 compared 2023 primarily due to higher revenues in 2024.

Robotics

Robotics revenues increased $39.8 million, or 15%, in 2024 compared to 2023. The increase was due to higher vessel, trenching and ROV utilization and higher rates in 2024. Chartered vessel days increased to 1,901 days, which included 371 spot vessel days, in 2024 compared to 1,699 days, which included 310 spot vessel days, in 2023. Vessel trenching days increased to 835 days in 2024 compared to 807 days in 2023. Overall ROV and trencher utilization increased to 69% in 2024 compared to 62% in 2023. Robotics operating income increased $24.9 million in 2024 compared to 2023. The increase in operating income was primarily due to higher revenues during 2023.

Shallow Water Abandonment

Shallow Water Abandonment revenues decreased $88.0 million, or 32%, in 2024 compared to 2023. The decrease in revenues was due primarily to lower utilization on our systems and vessels in 2024 compared to 2023. P&A and CT systems achieved 2,281 days of utilization, or 24%, during 2024 compared to 5,748 days, or 70%, during 2023. Vessel utilization (excluding heavy lift) declined to 61% in 2024 compared to 75% during 2023. Utilization on the EpicHedron heavy lift barge was 44% in 2024 compared to 68% during 2023. Shallow Water Abandonment generated an operating loss of $9.3 million during 2024 compared to operating income of $66.2 million in 2023, primarily due to lower revenue in 2024.

Production Facilities

Production Facilities revenues increased $0.8 million, or 1%, during 2024 compared to 2023. The increase was primarily due to higher oil and gas production volumes in 2024, offset in part by lower rates on the Helix Fast Response System, which were reduced with the Q4000 project in Nigeria during the second half 2024. Production Facilities operating income increased $0.5 million during 2024 primarily due to higher revenues compared to 2023.

Selling, General and Administrative and Other

Selling, General and Administrative

Selling, general and administrative expenses were $91.7 million, or 6.7% of revenue, in 2024 compared to $94.4 million, or 7.3% of revenue, in 2023. The decrease in expense was primarily due to a net decrease in compensation related costs offset partially by an increase in other facilities and professional fees in 2024.

Net Interest Expense

Net interest expense increased to $22.6 million in 2024 compared to $17.3 million in 2023. The increase was due to a full year of interest on our $300 million Senior Notes due 2029 issued during the fourth quarter 2023, offset in part by higher interest income on our invested cash during 2024.

Change in Fair Value of Contingent Consideration

Change in fair value of contingent consideration related to our acquisition of Alliance was $42.2 million during 2023 and reflects an increase in the fair value of the earnout that was based on Alliance earnings through 2023, which was paid in cash in April 2024.

Losses Related to Convertible Senior Notes

Losses related to convertible senior notes was $20.9 million in 2024 and $37.3 million in 2023 and are related to the redemption of the remaining $40.2 million principal amount of the 2026 Notes in 2024 and the repurchase of $159.8 million principal amount of the 2026 Notes during 2023.

Other Income and Expenses

Other expense, net was $3.9 million in 2024 compared to $3.6 million in 2023. Other expense, net in 2024 was primarily due to a charge of $2.4 million related to an increase in the value of incentive credits issued to the seller of P&A equipment acquired in 2023 and foreign currency losses due to the weakening of the British pound and Brazilian real in 2024, whereas other expense, net in 2023 primarily included foreign currency gains due to the strengthening in the British pound, offset in part by losses associated with the devaluation of our Nigerian naira holdings during 2023.

Cash Flows

Helix generated operating cash flows of $186.0 million in 2024 compared to $152.5 million in 2023. Operating cash flows in 2024 included $58.3 million cash paid for the earnout related to the Alliance acquisition. Absent this payment, operating cash flows would have increased $91.9 million compared to 2023 primarily due to higher earnings, improved working capital inflows, and lower regulatory certification costs on our vessels and systems in 2024. Regulatory certification costs, which are considered part of Helix’s capital spending program but are classified in operating cash flows, were $35.4 million in 2024 compared to $62.5 million in 2023.

Capital expenditures increased to $23.3 million in 2024 compared to $19.6 million in 2023.

Free Cash Flow increased to $163.2 million in 2024 compared to $133.8 million in 2023. The increase was due to higher operating cash flows, offset in part by higher capital expenditures in 2024 compared to 2023. (Free Cash Flow is a non-GAAP measure. See reconciliation below.)

Share Repurchases

Share repurchases in 2024 totaled 2.9 million shares for approximately $29.6 million compared to share repurchases in 2023 of 1.6 million shares for approximately $12.0 million.

Financial Condition and Liquidity

Cash and cash equivalents were $368.0 million on December 31, 2024. Available capacity under our ABL facility on December 31, 2024 was $66.6 million, and total liquidity was $429.6 million, and excludes cash pledged toward our ABL facility. Consolidated long-term debt was $315.2 million on December 31, 2024, resulting in negative Net Debt of $52.9 million. (Net Debt is a non-GAAP measure. See reconciliation below.)

* * * * *

Conference Call Information

Further details are provided in the presentation for Helix’s quarterly teleconference to review its fourth quarter and full year 2024 results (see the Investor Relations page of Helix’s website, www.helixesg.com). The teleconference is scheduled for Tuesday, February 25, 2025, at 9:00 a.m. Central Time. Investors and other interested parties wishing to participate in the teleconference should dial 1-800-715-9871 within the United States and 1-646-307-1963 outside the United States. The passcode is “Staffeldt.” A live webcast of the teleconference will be available in a listen-only mode on the Investor Relations section of Helix’s website. A replay of the webcast will be available on Helix’s website beginning approximately three hours after the completion of the event.

About Helix

Helix Energy Solutions Group, Inc., headquartered in Houston, Texas, is an international offshore energy services company that provides specialty services to the offshore energy industry, with a focus on well intervention, robotics and decommissioning operations. Our services are key in supporting a global energy transition by maximizing production of existing oil and gas reserves, decommissioning end-of-life oil and gas fields and supporting renewable energy developments. For more information about Helix, please visit our website at www.helixesg.com.

Non-GAAP Financial Measures

Management evaluates operating performance and financial condition using certain non-GAAP measures, primarily EBITDA, Adjusted EBITDA, Free Cash Flow and Net Debt. We define EBITDA as earnings before income taxes, net interest expense, net other income or expense, and depreciation and amortization expense. Non-cash impairment losses on goodwill and other long-lived assets are also added back if applicable. To arrive at our measure of Adjusted EBITDA, we exclude gains or losses on disposition of assets, acquisition and integration costs, gains or losses related to convertible senior notes, the change in fair value of contingent consideration, and the general provision (release) for current expected credit losses, if any. We define Free Cash Flow as cash flows from operating activities less capital expenditures, net of proceeds from asset sales and insurance recoveries (related to property and equipment), if any. Net Debt is calculated as long-term debt including current maturities of long-term debt less cash and cash equivalents and restricted cash.

We use EBITDA, Adjusted EBITDA, Free Cash Flow and Net Debt to monitor and facilitate internal evaluation of the performance of our business operations, to facilitate external comparison of our business results to those of others in our industry, to analyze and evaluate financial and strategic planning decisions regarding future investments and acquisitions, to plan and evaluate operating budgets, and in certain cases, to report our results to the holders of our debt as required by our debt covenants. We believe that our measures of EBITDA, Adjusted EBITDA, Free Cash Flow and Net Debt provide useful information to the public regarding our operating performance and ability to service debt and fund capital expenditures and may help our investors understand and compare our results to other companies that have different financing, capital and tax structures. Other companies may calculate their measures of EBITDA, Adjusted EBITDA, Free Cash Flow and Net Debt differently from the way we do, which may limit their usefulness as comparative measures. EBITDA, Adjusted EBITDA, Free Cash Flow and Net Debt should not be considered in isolation or as a substitute for, but instead are supplemental to, income from operations, net income, cash flows from operating activities, or other income or cash flow data prepared in accordance with GAAP. Users of this financial information should consider the types of events and transactions that are excluded from these measures. See reconciliation of the non-GAAP financial information presented in this press release to the most directly comparable financial information presented in accordance with GAAP. We have not provided reconciliations of forward-looking non-GAAP financial measures to comparable GAAP measures due to the challenges and impracticability with estimating some of the items without unreasonable effort, which amounts could be significant.

Forward-Looking Statements

This press release contains forward-looking statements that involve risks, uncertainties and assumptions that could cause our results to differ materially from those expressed or implied by such forward-looking statements. All statements, other than statements of historical fact, are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including, without limitation, any statements regarding: our plans, strategies and objectives for future operations; any projections of financial items including projections as to guidance and other outlook information; future operations expenditures; our ability to enter into, renew and/or perform commercial contracts; the spot market; our current work continuing; visibility and future utilization; our protocols and plans; future economic or political conditions; energy transition or energy security; our spending and cost management efforts and our ability to manage changes; oil price volatility and its effects and results; our ability to identify, effect and integrate mergers, acquisitions, joint ventures or other transactions, including the integration of the Alliance acquisition and any subsequently identified legacy issues with respect thereto; developments; any financing transactions or arrangements or our ability to enter into such transactions or arrangements; our sustainability initiatives; our share repurchase program or execution; any statements of expectation or belief; and any statements of assumptions underlying any of the foregoing. Forward-looking statements are subject to a number of known and unknown risks, uncertainties and other factors that could cause results to differ materially from those in the forward-looking statements, including but not limited to market conditions and the demand for our services; volatility of oil and natural gas prices; complexities of global political and economic developments; results from mergers, acquisitions, joint ventures or similar transactions; results from acquired properties; our ability to secure and realize backlog; the performance of contracts by customers, suppliers and other counterparties; actions by governmental and regulatory authorities; operating hazards and delays, which include delays in delivery, chartering or customer acceptance of assets or terms of their acceptance; the effectiveness of our sustainability initiatives and disclosures; human capital management issues; geologic risks; and other risks described from time to time in our filings with the Securities and Exchange Commission (“SEC”), including our most recently filed Annual Report on Form 10-K, which are available free of charge on the SEC’s website at www.sec.gov. We assume no obligation and do not intend to update these forward-looking statements, which speak only as of their respective dates, except as required by law.

       
HELIX ENERGY SOLUTIONS GROUP, INC.
       
Comparative Condensed Consolidated Statements of Operations
       
  Three Months Ended Dec. 31,   Year Ended Dec. 31,
(in thousands, except per share data)  

 

2024

 

  

 

2023

 

  

 

2024

 

  

 

2023

 
  (unaudited)   (unaudited)  
       
Net revenues  

$

355,133

 

  

$

335,157

 

  

$

1,358,560

 

  

$

1,289,728

 
Cost of sales  

 

296,274

 

  

 

285,879

 

  

 

1,138,996

 

  

 

1,089,372

 
Gross profit  

 

58,859

 

  

 

49,278

 

  

 

219,564

 

  

 

200,356

 
Gain (loss) on disposition of assets, net  

 

(429

)

  

 

–

 

  

 

(479

)

  

 

367

 
Acquisition and integration costs  

 

–

 

  

 

–

 

  

 

–

 

  

 

(540

)
Change in fair value of contingent consideration  

 

–

 

  

 

(10,927

)

  

 

–

 

  

 

(42,246

)
Selling, general and administrative expenses  

 

(27,552

)

  

 

(22,971

)

  

 

(91,650

)

  

 

(94,427

)
Income from operations  

 

30,878

 

  

 

15,380

 

  

 

127,435

 

  

 

63,510

 
Net interest expense  

 

(5,572

)

  

 

(4,771

)

  

 

(22,629

)

  

 

(17,338

)
Losses related to convertible senior notes  

 

–

 

  

 

(37,277

)

  

 

(20,922

)

  

 

(37,277

)
Other income (expense), net  

 

(1,275

)

  

 

6,963

 

  

 

(3,922

)

  

 

(3,590

)
Royalty income and other  

 

(30

)

  

 

93

 

  

 

2,102

 

  

 

2,209

 
Income (loss) before income taxes  

 

24,001

 

  

 

(19,612

)

  

 

82,064

 

  

 

7,514

 
Income tax provision  

 

3,880

 

  

 

8,721

 

  

 

26,427

 

  

 

18,352

 
Net income (loss)  

$

20,121

 

  

$

(28,333

)

  

$

55,637

 

  

$

(10,838

)
       
Earnings (loss) per share of common stock:        
Basic  

$

0.13

 

  

$

(0.19

)

  

$

0.37

 

  

$

(0.07

)
Diluted  

$

0.13

 

  

$

(0.19

)

  

$

0.36

 

  

$

(0.07

)
       
Weighted average common shares outstanding:        
Basic  

 

151,446

 

  

 

150,580

 

  

 

151,989

 

  

 

150,917

 
Diluted  

 

154,246

 

  

 

150,580

 

  

 

154,699

 

  

 

150,917

 
       
Comparative Condensed Consolidated Balance Sheets
       
      Dec. 31, 2024   Dec. 31, 2023
(in thousands)       (unaudited)  
       
ASSETS        
Current Assets:        
Cash and cash equivalents      

$

368,030

 

  

$

332,191

 
Accounts receivable, net      

 

258,630

 

  

 

280,427

 
Other current assets      

 

83,022

 

  

 

85,223

 
Total Current Assets      

 

709,682

 

  

 

697,841

 
       
Property and equipment, net      

 

1,437,853

 

  

 

1,572,849

 
Operating lease right-of-use assets      

 

329,649

 

  

 

169,233

 
Deferred recertification and dry dock costs, net      

 

71,718

 

  

 

71,290

 
Other assets, net      

 

48,178

 

  

 

44,823

 
Total Assets      

$

2,597,080

 

  

$

2,556,036

 
       
LIABILITIES AND SHAREHOLDERS’ EQUITY        
Current Liabilities:        
Accounts payable      

$

144,793

 

  

$

134,552

 
Accrued liabilities      

 

90,455

 

  

 

203,112

 
Current maturities of long-term debt      

 

9,186

 

  

 

48,292

 
Current operating lease liabilities      

 

59,982

 

  

 

62,662

 
Total Current Liabilities      

 

304,416

 

  

 

448,618

 
       
Long-term debt      

 

305,971

 

  

 

313,430

 
Operating lease liabilities      

 

285,984

 

  

 

116,185

 
Deferred tax liabilities      

 

113,973

 

  

 

110,555

 
Other non-current liabilities      

 

66,971

 

  

 

66,248

 
Shareholders’ equity      

 

1,519,765

 

  

 

1,501,000

 
Total Liabilities and Equity      

$

2,597,080

 

  

$

2,556,036

 
       
HELIX ENERGY SOLUTIONS GROUP, INC.
 
Comparative Condensed Consolidated Statements of Cash Flows
         
    Year Ended
(in thousands)         12/31/2024   12/31/2023
    (unaudited)  
         
Cash flows from operating activities:          
Net income (loss)        

$

55,637

 

  

$

(10,838

)
Adjustments to reconcile net income (loss) to net cash provided by          
operating activities:          
Depreciation and amortization        

 

173,292

 

  

 

164,116

 
Deferred recertification and dry dock costs        

 

(35,387

)

  

 

(62,522

)
Payment of earnout consideration        

 

(58,300

)

  

 

–

 
Change in fair value of contingent consideration        

 

–

 

  

 

42,246

 
Losses related to convertible senior notes        

 

20,922

 

  

 

37,277

 
Working capital and other        

 

29,864

 

  

 

(17,822

)
Net cash provided by operating activities        

 

186,028

 

  

 

152,457

 
         
Cash flows from investing activities:          
Capital expenditures        

 

(23,303

)

  

 

(19,588

)
Proceeds from sale of assets        

 

100

 

  

 

365

 
Proceeds from insurance recoveries        

 

363

 

  

 

564

 
Net cash used in investing activities        

 

(22,840

)

  

 

(18,659

)
         
Cash flows from financing activities:          
Proceeds from long-term debt        

 

–

 

  

 

298,578

 
Repayments of long-term debt        

 

(69,469

)

  

 

(269,480

)
Repurchases of common stock        

 

(29,620

)

  

 

(11,988

)
Payment of earnout consideration        

 

(26,700

)

  

 

–

 
Other financing activities        

 

479

 

  

 

7,999

 
Net cash provided by (used in) financing activities        

 

(125,310

)

  

 

25,109

 
         
Effect of exchange rate changes on cash and cash equivalents        

 

(2,039

)

  

 

(15,827

)
Net increase (decrease) in cash and cash equivalents        

 

35,839

 

  

 

143,080

 
Cash and cash equivalents:          
Balance, beginning of year        

 

332,191

 

  

 

189,111

 
Balance, end of year        

$

368,030

 

  

$

332,191

 
         
Reconciliation of Non-GAAP Measures
         
         
  Three Months Ended   Year Ended
(in thousands, unaudited)   12/31/2024   12/31/2023   9/30/2024   12/31/2024   12/31/2023
     
Reconciliation from Net Income (Loss) to Adjusted EBITDA:          
Net income (loss)  

$

20,121

 

  

$

(28,333

)

  

$

29,514

 

  

$

55,637

 

  

$

(10,838

)
Adjustments:          
Income tax provision  

 

3,880

 

  

 

8,721

 

  

 

9,520

 

  

 

26,427

 

  

 

18,352

 
Net interest expense  

 

5,572

 

  

 

4,771

 

  

 

5,689

 

  

 

22,629

 

  

 

17,338

 
Other (income) expense, net  

 

1,275

 

  

 

(6,963

)

  

 

49

 

  

 

3,922

 

  

 

3,590

 
Depreciation and amortization  

 

40,564

 

  

 

44,103

 

  

 

42,904

 

  

 

173,292

 

  

 

164,116

 
EBITDA  

 

71,412

 

  

 

22,299

 

  

 

87,676

 

  

 

281,907

 

  

 

192,558

 
Adjustments:          
(Gain) loss on disposition of assets, net  

 

429

 

  

 

–

 

  

 

(100

)

  

 

479

 

  

 

(367

)
Acquisition and integration costs  

 

–

 

  

 

–

 

  

 

–

 

  

 

–

 

  

 

540

 
Change in fair value of contingent consideration  

 

–

 

  

 

10,927

 

  

 

–

 

  

 

–

 

  

 

42,246

 
General provision (release) for current expected credit losses  

 

(200

)

  

 

129

 

  

 

45

 

  

 

(161

)

  

 

1,149

 
Losses related to convertible senior notes  

 

–

 

  

 

37,277

 

  

 

–

 

  

 

20,922

 

  

 

37,277

 
Adjusted EBITDA  

$

71,641

 

  

$

70,632

 

  

$

87,621

 

  

$

303,147

 

  

$

273,403

 
         
         
Free Cash Flow:          
Cash flows from operating activities  

$

77,977

 

  

$

94,737

 

  

$

55,731

 

  

$

186,028

 

  

$

152,457

 
Less: Capital expenditures, net of proceeds from asset sales and insurance recoveries  

 

(12,523

)

  

 

(2,859

)

  

 

(3,086

)

  

 

(22,840

)

  

 

(18,659

)
Free Cash Flow  

$

65,454

 

  

$

91,878

 

  

$

52,645

 

  

$

163,188

 

  

$

133,798

 
         
         
Net Debt:          
Long-term debt including current maturities  

$

315,157

 

  

$

361,722

 

  

$

314,673

 

  

$

315,157

 

  

$

361,722

 
Less: Cash and cash equivalents  

 

(368,030

)

  

 

(332,191

)

  

 

(324,120

)

  

 

(368,030

)

  

 

(332,191

)
Net Debt  

$

(52,873

)

  

$

29,531

 

  

$

(9,447

)

  

$

(52,873

)

  

$

29,531

 
         

 

Erik Staffeldt, Executive Vice President and CFO

email: [email protected]

Ph: 281-618-0400

KEYWORDS: United States North America Texas

INDUSTRY KEYWORDS: Robotics Other Energy Technology Oil/Gas Alternative Energy Energy

MEDIA:

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Posted on

B&G Foods Declares Regular Quarterly Dividend

B&G Foods Declares Regular Quarterly Dividend

PARSIPPANY, N.J.–(BUSINESS WIRE)–
B&G Foods, Inc. (NYSE: BGS) announced today that its Board of Directors has declared a regular quarterly cash dividend of $0.19 per share of common stock. The dividend is payable on April 30, 2025 to stockholders of record as of March 31, 2025.

At the closing market price of the common stock on February 24, 2025, the current dividend rate represents an annualized yield of 11.3%. This is the 82nd consecutive quarterly dividend declared by the Board of Directors since B&G Foods’ initial public offering in October 2004.

About B&G Foods, Inc.

Based in Parsippany, New Jersey, B&G Foods and its subsidiaries manufacture, sell and distribute high-quality, branded shelf-stable and frozen foods across the United States, Canada and Puerto Rico. With B&G Foods’ diverse portfolio of more than 50 brands you know and love, including B&G, B&M, Bear Creek, Cream of Wheat, Crisco, Dash, Green Giant, Las Palmas, Le Sueur, Mama Mary’s, Maple Grove Farms, New York Style, Ortega, Polaner, Spice Islands and Victoria, there’s a little something for everyone. For more information about B&G Foods and its brands, please visit www.bgfoods.com.

Investor Relations:

ICR, Inc.

Anna Kate Heller

[email protected]

Media Relations:

ICR, Inc.

Matt Lindberg

203.682.8214

KEYWORDS: New Jersey United States North America

INDUSTRY KEYWORDS: Food/Beverage Other Retail Retail Supermarket Specialty

MEDIA:

Posted on

Douglas Dynamics Reports Fourth Quarter And Full Year 2024 Results

Results Driven by Record Performance at Work Truck Solutions and Margin Improvement at Work Truck Attachments


Full Year 2024 Highlights*

  • Net Sales of $568.5 million, Net Income of $56.2 million, and Diluted Earnings per Share of $2.36
  • Both Adjusted Net Income and Adj. Diluted EPS increased approximately 45% to $35.2 million $1.47, respectively
  • Work Truck Solutions produced record full year results
  • Work Truck Attachments delivered improved margins
  • 2024 Cost Savings Program exceeded expectations delivering over $10 million in savings
  • Announced 1Q25 quarterly dividend of $0.295 per share
  • Outlined 2025 full year outlook

*Compared to full year 2023 financials

MILWAUKEE, Wis., Feb. 24, 2025 (GLOBE NEWSWIRE) — Douglas Dynamics, Inc. (NYSE: PLOW), North America’s premier manufacturer and upfitter of work truck attachments and equipment, today announced financial results for the fourth quarter and full year ended December 31, 2024.

“With a strong end to the year, we are pleased with the improved performance we have produced in 2024,” noted Jim Janik, Chairman, Interim President, and CEO. “Our Work Truck Solutions team delivered impressive top and bottom-line growth again through a combination of robust execution and improved business conditions. Our Work Truck Attachments segment operated efficiently in a tough environment, as evidenced by their improved margins. We believe the hard work completed in 2024 to streamline our operations and focus on critical projects will continue to pay off in the years ahead.”


Consolidated Results

$ in millions

(except Margins & EPS) 		Q4 2024 Q4 2023 FY 2024 FY 2023
Net Sales $143.5 $134.2 $568.5 $568.2
Gross Profit Margin 24.9% 22.0% 25.8% 23.6%
         
Income from Operations $13.0 $12.6 $88.7 $44.9
Net Income $7.9 $7.1 $56.2 $23.7
Diluted EPS $0.33 $0.29 $2.36 $0.98
         
Adjusted EBITDA $18.8 $14.9 $79.3 $68.1
Adjusted EBITDA Margin 13.1% 11.1% 14.0% 12.0%
Adjusted Net Income $9.3 $4.5 $35.2 $24.4
Adjusted Diluted EPS $0.39 $0.19 $1.47 $1.01

  • Fourth quarter and Full Year 2024 consolidated results improved across all metrics when compared to the prior year, primarily due to strong top and bottom-line growth in the Solutions segment and increased profitability in the Attachments segment.
  • Net Sales were $568.5 million for the full year 2024, compared to $568.2 million in 2023.
  • Full Year gross margins increased 220-basis points compared to prior year, based on improved price realization and throughput at Solutions and the impact of the 2024 Cost Savings Program.
  • Full year selling, general and administrative expenses increased to $91.7 million for 2024 compared to $78.8 million for the prior year. The increase was mainly due to one-time items, including costs for the sale leaseback transaction, severance costs related to the Cost Savings Program, and CEO transition costs. In addition, there was higher incentive-based compensation due to higher earnings.
  • The 2024 Cost Savings Program produced pre-tax savings of more than $10 million in 2024.
  • The dramatic increase in full year Net Income compared to 2023 includes a one-time gain of $42.3 million from the sale leaseback transaction realized in the third quarter, plus improved profitability as a percentage of Net Sales in both segments.
  • Adjusted EBITDA increased 16.4% to $79.3 million for 2024, compared to $68.1 million in the corresponding period of 2023.
  • Adjusted Earnings Per Share for 2024 increased approximately 45% to $1.47 compared to $1.01 in 2023.
  • The effective tax rate for 2024 was 24.0% compared to 18.9% for 2023. The effective tax rate for 2023 was impacted by a tax benefit related to the purchase of investment tax credits included in the annual effective tax rate, as well as higher tax credits.
  • Total backlog at the start of 2025 was a near record $348 million and remains significantly elevated compared to historical averages.


Work Truck Attachments

$ in millions

(except Adjusted EBITDA Margin) 		Q4 2024 Q4 2023 FY 2024 FY 2023
Net Sales $53.8 $55.4 $256.0 $291.7
Adjusted EBITDA $9.0 $6.2 $48.5 $50.6
Adjusted EBITDA Margin 16.7% 11.1% 18.9% 17.3%

  • The Attachments segment continued to see the impact of low snowfall in core markets during previous snow seasons, which created an elongated equipment replacement cycle and led to lower Net Sales for the quarter and full year.
  • Adjusted EBITDA for the fourth quarter was $9.0 million, which was 45.7% higher than $6.2 million recorded in the prior year.
  • Adjusted EBITDA in 2024 was $48.5 million compared to $50.6 million in the prior year.
  • The 2024 Cost Savings Program allowed Attachments to maximize profitability despite suppressed demand, with Adjusted EBITDA margins improving 160 basis points to 18.9% for 2024.

Janik explained, “The determination of our Attachments team to efficiently manage production and inventory levels throughout the year, coupled with the implementation of the 2024 Cost Savings Program, led to improved margins in 2024. The impact of low snowfall in the previous two winters continued to suppress demand and create difficult market conditions, and we are proud of the resilience shown by our team.”


Work Truck Solutions

$ in millions

(except Adjusted EBITDA Margin) 		Q4 2024 Q4 2023 FY 2024 FY 2023
Net Sales $89.8 $78.9 $312.5 $276.5
Adjusted EBITDA $9.8 $8.8 $30.9 $17.6
Adjusted EBITDA Margin 10.9% 11.1% 9.9% 6.4%

  • The Solutions segment recorded another strong quarter to complete a record year driven by higher volumes and price realization, plus improved production efficiencies.
  • Fourth quarter 2024 Net Sales increased 13.8%, and Adjusted EBITDA increased 11.9% compared to the previous year, which produced fourth quarter Adjusted EBITDA margins of 10.9%.
  • On a full-year basis, Net Sales grew 13.0% to $312.5 million.
  • Full year 2024 Adjusted EBITDA increased 75.6% to $30.9 million, with margins of 9.9%, a 350-basis point improvement compared to 2023.   

“The Solutions team exceeded our expectations in 2024, generating record results for the year. We are pleased with the ongoing improvements, which returned us to near double-digit margins, and we enter 2025 with a strong backlog and continued positive demand across the segment,” said Janik.


Capital Allocation & Liquidity

  • A quarterly cash dividend of $0.295 per share of the Company’s common stock was declared on December 5, 2024, and paid on December 31, 2024, to stockholders of record as of the close of business on December 16, 2024.
  • The Board of Directors also approved and declared a quarterly cash dividend of $0.295 per share for the first quarter of 2025. The declared dividend will be paid on March 31, 2025, to stockholders of record as of the close of business on March 18, 2025.
  • Net Cash Provided by Operating Activities increased significantly from $12.5 million in 2023 to $41.1 million in 2024. The improvement relates to favorable working capital changes. 
  • At the end of 2024, liquidity consisted of approximately $5.1 million in cash and cash equivalents and borrowing availability of approximately $150 million under our revolving credit facility.
  • Proceeds from the sale leaseback transaction, executed in September 2024, favorably impacted cash provided by investing activities by $64.2 million. Net proceeds of $42.0 million were used in financing activities to voluntarily prepay long-term debt.
  • Free cash flow for 2024 was $33.3 million, a significant improvement when compared to $1.9 million in 2023. The increase of $31.4 million is primarily a result of an increase in cash provided by operating activities and lower capital expenditures.
  • The leverage ratio at December 31, 2024 was 2.4X, an improvement when compared to slightly below 3.5X at the end of 2023, due to the voluntary pre-payment of debt during the year, and within our stated goal range of 1.5X to 3.0X.


2025 Outlook

Sarah Lauber, Executive Vice President and CFO, explained, “Following a year of profitability improvements, we believe we are well positioned for 2025 and beyond. The advancements over the past two years at Work Truck Solutions mean we are at the low end of our target margins with a strong backlog. For Work Truck Attachments, our operations are lean and efficient, and we expect to better understand the elongated equipment replacement cycle once winter is over and the preseason order period is in full swing.”

Lauber continued, “Based on the progress we have made in 2024, we believe our manufacturing strength, when combined with the quality of our people, will allow us to continue to lead the markets we serve and produce long-term growth. Our guidance for 2025 reflects our positive outlook, and the mid-point of our ranges indicate our ability to deliver year-over-year growth.”

2025 Outlook

  • Net Sales are expected to be between $610 million and $650 million.
  • Adjusted EBITDA is predicted to range from $75 million to $95 million.
  • Adjusted Earnings Per Share are expected to be in the range of $1.30 per share to $2.10 per share.
  • The effective tax rate is expected to be approximately 24% to 25%. 

The 2025 outlook assumes relatively stable economic and supply chain conditions,
and that core markets will experience average snowfall in 2025.

With respect to the Company’s 2025 financial outlook, the Company is not able to provide a reconciliation of the non-GAAP financial measures to GAAP because it does not provide specific guidance for the various extraordinary, nonrecurring, or unusual charges and other certain items. These items have not yet occurred, are out of the Company’s control and/or cannot be reasonably predicted. As a result, reconciliation of the non-GAAP guidance measures to GAAP is not available without unreasonable effort and the Company is unable to address the probable significance of the unavailable information.


Earnings Conference Call Information

The Company will host a conference call on Tuesday, February 25, 2025, at 10:00 a.m. Eastern Time (9:00 a.m. Central Time). To join the conference call, please dial (833) 634-5024 domestically, or (412) 902-4205 internationally. The call will also be available via the Investor Relations section of the Company’s website at www.douglasdynamics.com. For those who cannot listen to the live broadcast, replays will be available for one week following the call.


About Douglas Dynamics

Home to the most trusted brands in the industry, Douglas Dynamics is North America’s premier manufacturer and up-fitter of commercial work truck attachments and equipment. For more than 75 years, the Company has been innovating products that not only enable people to perform their jobs more efficiently and effectively, but also enable businesses to increase profitability. Through its proprietary Douglas Dynamics Management System (DDMS), the Company is committed to continuous improvement aimed at consistently producing the highest quality products, at industry-leading levels of service and delivery that ultimately drive shareholder value. The Douglas Dynamics portfolio of products and services is separated into two segments: First, the Work Truck Attachments segment, which includes commercial snow and ice control equipment sold under the FISHER®, SNOWEX® and WESTERN® brands. Second, the Work Truck Solutions segment, which includes the up-fit of market leading attachments and storage solutions under the HENDERSON® brand, and the DEJANA® brand and its related sub-brands.


Use of Non-GAAP Financial Measures

This press release contains financial information calculated other than in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”). The non-GAAP measures used in this press release are Adjusted EBITDA, Adjusted Net Income and Adjusted Earnings Per Share, and Free Cash Flow. The Company believes that these non-GAAP measures are useful to investors and other external users of its consolidated financial statements in evaluating the Company’s operating performance as compared to that of other companies. Reconciliations of these non-GAAP measures to the nearest comparable GAAP measures can be found immediately following the Consolidated Statements of Cash Flows included in this press release.

Adjusted EBITDA represents net income before interest, taxes, depreciation, and amortization, as further adjusted for certain charges consisting of unrelated legal and consulting fees, stock-based compensation, severance, restructuring charges, CEO transition costs, insurance proceeds, gain on sale leaseback transaction and related transaction costs, and impairment charges. The Company uses Adjusted EBITDA in evaluating the Company’s operating performance because it provides the Company and its investors with additional tools to compare its operating performance on a consistent basis by removing the impact of certain items that management believes do not directly reflect the Company’s core operations. The Company’s management also uses Adjusted EBITDA for planning purposes, including the preparation of its annual operating budget and financial projections, and to evaluate the Company’s ability to make certain payments, including dividends, in compliance with its senior credit facilities, which is determined based on a calculation of “Consolidated Adjusted EBITDA” that is substantially similar to Adjusted EBITDA.

Adjusted Net Income and Adjusted Earnings Per Share (calculated on a diluted basis) represents net income and earnings per share (as defined by GAAP), excluding the impact of stock based compensation, severance, restructuring charges, CEO transition costs, insurance proceeds, gain on sale leaseback transaction and related transaction costs, impairment charges, certain charges related to unrelated legal fees and consulting fees, and adjustments on derivatives not classified as hedges, net of their income tax impact. Adjustments on derivatives not classified as hedges are non-cash and are related to overall financial market conditions; therefore, management believes such costs are unrelated to our business and are not representative of our results. Management believes that Adjusted Net Income and Adjusted Earnings Per Share are useful in assessing the Company’s financial performance by eliminating expenses and income that are not reflective of the underlying business performance.

Free Cash Flow is a non-GAAP financial measure that we define as net cash provided by (used in) operating activities less capital expenditures. Free Cash Flow should be evaluated in addition to, and not considered a substitute for, other financial measures such as Net Income and Net Cash Provided By (Used in) Operating Activities. We believe that free cash flow represents our ability to generate additional cash flow from our business operations.


Forward Looking Statements

This press release contains certain forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. These statements include information relating to future events, future financial performance, strategies, expectations, competitive environment, regulation, product demand, the payment of dividends, and availability of financial resources. These statements are often identified by use of words such as “anticipate,” “believe,” “intend,” “estimate,” “expect,” “continue,” “should,” “could,” “may,” “plan,” “project,” “predict,” “will” and similar expressions and include references to assumptions and relate to our future prospects, developments, and business strategies.  Such statements involve known and unknown risks, uncertainties and other factors that could cause our actual results, performance, or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, weather conditions, particularly lack of or reduced levels of snowfall and the timing of such snowfall, our ability to manage general economic, business and geopolitical conditions, including the impacts of natural disasters, labor strikes, global political instability, adverse developments affecting the banking and financial services industries, pandemics and outbreaks of contagious diseases and other adverse public health developments, increases in the price of steel or other materials, including as a result of tariffs, necessary for the production of our products that cannot be passed on to our distributors, our inability to maintain good relationships with our distributors, our inability to maintain good relationships with the original equipment manufacturers with whom we currently do significant business, lack of available or favorable financing options for our end-users, distributors or customers, increases in the price of fuel or freight, a significant decline in economic conditions, the inability of our suppliers and original equipment manufacturer partners to meet our volume or quality requirements, inaccuracies in our estimates of future demand for our products, our inability to protect or continue to build our intellectual property portfolio, the effects of laws and regulations and their interpretations on our business and financial condition, including policy or regulatory changes related to climate change, our inability to develop new products or improve upon existing products in response to end-user needs, losses due to lawsuits arising out of personal injuries associated with our products, factors that could impact the future declaration and payment of dividends, or our ability to execute repurchases under our stock repurchase program, our inability to effectively manage the use of artificial intelligence, our inability to compete effectively against competition, our inability to successfully implement our new enterprise resource planning system at Dejana, as well as those discussed in the section entitled “Risk Factors” in our annual report on Form 10-K for the year ended December 31, 2023 and any subsequent Form 10-Q filings. You should not place undue reliance on these forward-looking statements. In addition, the forward-looking statements in this release speak only as of the date hereof and we undertake no obligation, except as required by law, to update or release any revisions to any forward-looking statement, even if new information becomes available in the future.

For further information contact:
Douglas Dynamics, Inc.
Nathan Elwell
Vice President of Investor Relations
847-530-0249
[email protected]


Financial Statements

Douglas Dynamics, Inc.  
Consolidated Balance Sheets  
(In thousands)  
       
       
  December 31, December 31,  
  2024 2023  
  (unaudited) (unaudited)  
       
Assets      
Current assets:      
Cash and cash equivalents $ 5,119 $ 24,156  
Accounts receivable, net   87,407   83,760  
Inventories   137,034   140,390  
Inventories – truck chassis floor plan   2,612   2,217  
Refundable income taxes paid   –   4,817  
Prepaid and other current assets   6,053   6,898  
Total current assets   238,225   262,238  
       
Property, plant, and equipment, net   41,311   67,340  
Goodwill   113,134   113,134  
Other intangible assets, net   113,550   121,070  
Operating lease – right of use asset   70,801   18,008  
Non-qualified benefit plan assets   10,482   9,195  
Other long-term assets   2,480   2,433  
Total assets $ 589,983 $ 593,418  
       
Liabilities and stockholders’ equity      
Current liabilities:      
Accounts payable $ 32,319 $ 31,374  
Accrued expenses and other current liabilities   26,182   25,817  
Floor plan obligations   2,612   2,217  
Operating lease liability – current   7,394   5,347  
Income taxes payable   1,685   –  
Short term borrowings   –   47,000  
Current portion of long-term debt   –   6,762  
Total current liabilities   70,192   118,517  
       
Retiree benefits and deferred compensation   13,616   13,922  
Deferred income taxes   24,574   27,903  
Long-term debt, less current portion   146,679   181,491  
Operating lease liability – noncurrent   64,785   13,887  
Other long-term liabilities   5,922   6,133  
       
Total stockholders’ equity   264,215   231,565  
Total liabilities and stockholders’ equity $ 589,983 $ 593,418  
       

Douglas Dynamics, Inc.  
Consolidated Statements of Income  
(In thousands, except share and per share data)  
             
  Three Month Period Ended   Twelve Month Period Ended  
  December 31, 2024 December 31, 2023   December 31, 2024 December 31, 2023  
 
(unaudited)
 		 
(unaudited)
 		 
             
             
Net sales $ 143,549   $ 134,245     $ 568,504   $ 568,178    
Cost of sales   107,810     104,742       421,667     433,908    
Gross profit   35,739     29,503       146,837     134,270    
             
Selling, general, and administrative expense   21,136     14,229       91,682     78,841    
Impairment charges   –     –       1,224     –    
Gain on sale leaseback transaction   –     –       (42,298 )   –    
Intangibles amortization   1,630     2,630       7,520     10,520    
             
Income from operations   12,973     12,644       88,709     44,909    
             
Interest expense, net   (3,144 )   (4,468 )     (15,260 )   (15,675 )  
Other income (expense), net   138     19       442     –    
Income before taxes   9,967     8,195       73,891     29,234    
             
Income tax expense   2,060     1,118       17,740     5,511    
             
Net income $ 7,907   $ 7,077     $ 56,151   $ 23,723    
             
Weighted average number of common shares outstanding:            
Basic   23,094,047     22,983,965       23,072,993     22,962,591    
Diluted   23,611,050     22,983,965       23,509,976     22,962,591    
             
Earnings per share:            
Basic earnings per common share attributable to common shareholders $ 0.33   $ 0.30     $ 2.39   $ 1.01    
Earnings per common share assuming dilution attributable to common shareholders $ 0.33   $ 0.29     $ 2.36   $ 0.98    
Cash dividends declared and paid per share $ 0.30   $ 0.30     $ 1.18   $ 1.18    
             

Douglas Dynamics, Inc.  
Consolidated Statements of Cash Flows  
(In thousands)  
       
  Twelve Month Period Ended  
  December 31, 2024 December 31, 2023  
 
(unaudited)
 		 
       
Operating activities      
Net income $ 56,151   $ 23,723    
Adjustments to reconcile net income to net cash provided by operating activities:      
Depreciation and amortization   17,890     21,662    
Loss (gain) on disposal of fixed asset   347     (56 )  
Amortization of deferred financing costs and debt discount   703     588    
Gain on sale leaseback transaction   (42,298 )   –    
Stock-based compensation   4,860     953    
Adjustments on derivatives not designated as hedges   (287 )   (688 )  
Provision for losses on accounts receivable   702     320    
Deferred income taxes   (3,042 )   7,561    
Impairment charges   1,224     –    
Non-cash lease expense   6,319     5,097    
Changes in operating assets and liabilities, net of acquisitions:      
Accounts receivable   (4,348 )   2,684    
Inventories   3,356     (3,888 )  
Prepaid assets, refundable income taxes paid and other assets   2,185     (14,010 )  
Accounts payable   991     (17,123 )  
Accrued expenses and other current liabilities   2,052     (8,154 )  
Benefit obligations, long-term liabilities and other   (5,674 )   (6,200 )  
Net cash provided by operating activities   41,131     12,469    
       
Investing activities      
Capital expenditures   (7,810 )   (10,521 )  
Proceeds from sale leaseback transaction   64,150     —    
Proceeds from insurance recoveries   452     —    
Net cash provided by (used in) investing activities   56,792     (10,521 )  
       
Financing activities      
Payments of financing costs   (279 )   (334 )  
Proceeds from (payments on) life insurance policy loans   (204 )   750    
Dividends paid   (27,477 )   (27,441 )  
Net revolver borrowings   (47,000 )   47,000    
Repayment of long-term debt   (42,000 )   (18,437 )  
Net cash provided by (used in) financing activities   (116,960 )   1,538    
Change in cash and cash equivalents   (19,037 )   3,486    
Cash and cash equivalents at beginning of period   24,156     20,670    
Cash and cash equivalents at end of period $ 5,119   $ 24,156    
       
Non-cash operating and financing activities      
Truck chassis inventory acquired through floorplan obligations $ 5,637   $ 7,875    
       

Douglas Dynamics, Inc.  
Segment Disclosures (unaudited)  
(In thousands)  
                         
  Three Months Ended December 31, 2024   Three Months Ended December 31, 2023   Twelve Months Ended December 31, 2024   Twelve Months Ended December 31, 2023  
                         
Work Truck Attachments                        
Net Sales $ 53,784     $ 55,377     $ 256,010     $ 291,723    
Adjusted EBITDA $ 8,992     $ 6,170     $ 48,455     $ 50,563    
Adjusted EBITDA Margin   16.7 %     11.1 %     18.9 %     17.3 %  
                         
Work Truck Solutions                        
Net Sales $ 89,765     $ 78,868     $ 312,494     $ 276,455    
Adjusted EBITDA $ 9,797     $ 8,752     $ 30,894     $ 17,559    
Adjusted EBITDA Margin   10.9 %     11.1 %     9.9 %     6.4 %  
                         
Douglas Dynamics, Inc.  
Net Income to Adjusted EBITDA reconciliation (unaudited)  
(In thousands)  
    Three month period ended December 31,   Twelve month period ended December 31,  
    2024   2023     2024     2023  
                   
Net income   $ 7,907   $ 7,077     $ 56,151     $ 23,723  
                   
Interest expense – net     3,144     4,468       15,260       15,675  
Income tax expense     2,060     1,118       17,740       5,511  
Depreciation expense     2,231     2,852       10,370       11,142  
Intangibles amortization     1,630     2,630       7,520       10,520  
EBITDA     16,972     18,145       107,041       66,571  
                   
Stock-based compensation     1,233     (3,283 )     4,860       953  
Impairment charges (1)     –     –       1,224       –  
Gain on sale leaseback transaction   –     –       (42,298 )     –  
Sale leaseback transaction fees     –     –       5,257       –  
Restructuring and severance costs   178     –       1,997       –  
Other charges (2)     406     60       1,268       598  
Adjusted EBITDA   $ 18,789   $ 14,922     $ 79,349     $ 68,122  
                   
(1) Reflects impairment charges taken on certain internally developed software in the year ended December 31, 2024.  
(2) Reflects unrelated legal and consulting fees, insurance proceeds, and CEO transition costs for the periods presented.  
   

Douglas Dynamics, Inc.  
Reconciliation of Net Income to Adjusted Net Income (unaudited)  
(In thousands, except share and per share data)  
    Three month period ended December 31,     Twelve month period ended December 31,  
      2024       2023         2024       2023    
                     
Net income   $ 7,907     $ 7,077       $ 56,151     $ 23,723    
Adjustments:                    
Stock based compensation   1,233       (3,283 )       4,860       953    
Impairment charges (1)     –       –         1,224       –    
Gain on sale leaseback transaction   –       –         (42,298 )     –    
Sale leaseback transaction fees   –       –         5,257       –    
Restructuring and severance costs     178       –         1,997       –    
Adjustments on derivative not classified as hedge (2)   –       (172 )       (287 )     (688 )  
Other charges (3)     406       60         1,268       598    
Tax effect on adjustments     (454 )     849         6,995       (216 )  
Adjusted net income   $ 9,270     $ 4,531       $ 35,167     $ 24,370    
                     
Weighted average basic common shares outstanding   23,094,047       22,983,965         23,072,993       22,962,591    
Weighted average common shares outstanding assuming dilution   23,611,050       22,983,965         23,509,976       22,962,591    
                     
Adjusted earnings per common share – dilutive $ 0.39     $ 0.19       $ 1.47     $ 1.01    
                     
GAAP diluted earnings per share $ 0.33     $ 0.29       $ 2.36     $ 0.98    
Adjustments net of income taxes:                  
                     
Stock based compensation   0.04       (0.09 )       0.16       0.03    
Impairment charges (1)     –       –         0.04       –    
Gain on sale leaseback transaction   –       –         (1.35 )     –    
Sale leaseback transaction fees   –       –         0.17       –    
Restructuring and severance costs     0.01       –         0.06       –    
Adjustments on derivative not classified as hedge (2)     –       (0.01 )       (0.01 )     (0.02 )  
Other charges (3)     0.00       –         0.04       0.02    
                     
Adjusted diluted earnings per share $ 0.39     $ 0.19       $ 1.47     $ 1.01    
                     
(1) Reflects impairment charges taken on certain internally developed software in the twelve months ended December 31, 2024.    
(2) Reflects non-cash mark-to-market and amortization adjustments on an interest rate swap not classified as a hedge for the periods presented.    
(3) Reflects unrelated legal and consulting fees, insurance proceeds, and CEO transition costs for the periods presented.    
                     

Douglas Dynamics, Inc.  
Free Cash Flow reconciliation (unaudited)  
(In thousands)  
    Three month period ended December 31,   Twelve month period ended December 31,  
    2024   2023   2024   2023  
                   
Net cash provided by operating activities $ 74,404     $ 76,617     $ 41,131     $ 12,469    
Acquisition of property and equipment   (3,828 )     (2,798 )     (7,810 )     (10,521 )  
Free cash flow   $ 70,576     $ 73,819     $ 33,321     $ 1,948    
   



Posted on

Ziff Davis Reports Fourth Quarter and Full Year 2024 Financial Results and Provides 2025 Guidance

Ziff Davis Reports Fourth Quarter and Full Year 2024 Financial Results and Provides 2025 Guidance

NEW YORK–(BUSINESS WIRE)–
Ziff Davis, Inc. (NASDAQ: ZD) (“Ziff Davis” or “the Company”) today reported unaudited financial results for the fourth quarter and year ended December 31, 2024.

“We believe 2024 marked an inflection point for the Company as it returned to revenue, adjusted diluted EPS, and free cash flow growth,” said Vivek Shah, Chief Executive Officer of Ziff Davis. “We are also excited to introduce a new segment reporting structure that we believe will aid investors in gaining a better understanding and appreciation of our business.”

FOURTH QUARTER 2024 RESULTS

  • Q4 2024 quarterly revenues increased 5.9% to $412.8 million compared to $389.9 million for Q4 2023.

  • Income from operations decreased to $78.5 million compared to $80.7 million for Q4 2023.

  • Net income (1) increased 1.0% to $64.1 million compared to $63.4 million for Q4 2023.

  • Net income per diluted share (1) increased to $1.43 in Q4 2024 compared to $1.29 for Q4 2023.

  • Adjusted EBITDA (2) for the quarter increased 2.5% to $171.8 million compared to $167.6 million for Q4 2023.

  • Adjusted net income (2) increased 3.0% to $110.2 million compared to $107.0 million for Q4 2023.

  • Adjusted net income per diluted share (1)(2) (or “Adjusted diluted EPS”) for the quarter increased 10.7% to $2.58 compared to $2.33 for Q4 2023.

  • Net cash provided by operating activities was $158.2 million in Q4 2024 compared to $92.1 million in Q4 2023. Free cash flow (2) was $131.1 million in Q4 2024 compared to $65.9 million in Q4 2023.

  • Ziff Davis ended the quarter with approximately $664.1 million in cash, cash equivalents, and investments after deploying approximately $6.4 million for current and prior year acquisitions during the quarter and $1.2 million primarily related to share repurchases.

FULL YEAR 2024 RESULTS

  • 2024 yearly revenues increased 2.8% to $1.40 billion compared to $1.36 billion for 2023.

  • Income from operations decreased to $113.6 million compared to $132.6 million for 2023. This includes a $85.3 million goodwill impairment recognized in 2024 compared to a $56.9 million goodwill impairment recognized in 2023.

  • Net income (1) increased 51.9% to $63.0 million compared to $41.5 million for 2023.

  • Net income per diluted share (1) increased to $1.42 in 2024 compared to $0.89 for 2023.

  • Adjusted EBITDA (2) for the year increased 2.3% to $493.5 million compared to $482.3 million for 2023.

  • Adjusted net income (2) for the year increased 2.5% to $294.5 million compared to $287.4 million for 2023.

  • Adjusted diluted EPS (1)(2) for the year increased 6.9% to $6.62 compared to $6.19 for 2023.

  • Net cash provided by operating activities was $390.3 million in 2024 compared to $320.0 million in 2023. Free cash flow (2) was $283.7 million in 2024 compared to $211.2 million in 2023.

  • Ziff Davis deployed approximately $225.4 million for current and prior year acquisitions during the year and $185.2 million related to share repurchases in 2024.

The following table reflects results for the three months and year ended December 31, 2024 and 2023, respectively (in millions, except per share amounts).

(Unaudited)

Three months ended

December 31,

% Change

Years ended

December 31,

% Change

2024

2023

2024

2023

Revenues

 

 

 

 

 

 

Technology & Shopping

$132.9

$105.2

26.3%

$361.9

$330.6

9.5%

Gaming & Entertainment

$50.9

$49.2

3.5%

$180.3

$168.8

6.8%

Health & Wellness

$105.7

$106.5

(0.7)%

$362.4

$361.9

0.1%

Connectivity

$54.3

$57.0

(4.9)%

$213.6

$211.5

1.0%

Cybersecurity and Martech

$69.0

$72.0

(4.0)%

$283.5

$291.2

(2.6)%

Total revenues (3)

$412.8

$389.9

5.9%

$1,401.7

$1,364.0

2.8%

Income from operations

$78.5

$80.7

(2.7)%

$113.6

$132.6

(14.3)%

Operating income margin

19.0%

20.7%

(1.7)%

8.1%

9.7%

(1.6)%

Net income (1)

$64.1

$63.4

1.0%

$63.0

$41.5

51.9%

Net income per diluted share (1)

$1.43

$1.29

10.9%

$1.42

$0.89

59.6%

Adjusted EBITDA (2)

$171.8

$167.6

2.5%

$493.5

$482.3

2.3%

Adjusted EBITDA margin (2)

41.6%

43.0%

(1.4)%

35.2%

35.4%

(0.2)%

Adjusted net income (1)(2)

$110.2

$107.0

3.0%

$294.5

$287.4

2.5%

Adjusted diluted EPS (1)(2)

$2.58

$2.33

10.7%

$6.62

$6.19

6.9%

Net cash provided by operating activities

$158.2

$92.1

71.8%

$390.3

$320.0

22.0%

Free cash flow (2)

$131.1

$65.9

99.0%

$283.7

$211.2

34.3%

Notes:

(1)

 

GAAP effective tax rates were approximately 18.3% and 17.0% for the three months ended December 31, 2024 and 2023, respectively, and 44.4% and 32.2% for the year ended December 31, 2024 and 2023, respectively. Adjusted effective tax rates were approximately 22.8% and 22.5% for the three months ended December 31, 2024 and 2023, respectively, and 23.5% and 23.3% for the year ended December 31, 2024 and 2023, respectively.

(2)

 

For definitions of non-GAAP financial measures and reconciliations of GAAP to non-GAAP financial measures refer to section “Non-GAAP Financial Measures” further in this release.

(3)

 

The revenues associated with each of the businesses may not foot precisely since each is presented independently.

ZIFF DAVIS GUIDANCE

The Company’s full year 2025 outlook is as follows (in millions, except per share data):

 

2024 Actual

 

2025 Range of Estimates

 

Growth

 

(unaudited)

 

Low

 

High

 

Low

 

High

Revenue

$

1,402

 

$

1,442

 

$

1,502

 

2.9

%

 

7.2

%

Adjusted EBITDA

$

494

 

$

505

 

$

542

 

2.3

%

 

9.8

%

Adjusted diluted EPS*

$

6.62

 

$

6.64

 

$

7.28

 

0.3

%

 

10.0

%
_______________________

*

It is anticipated that the Adjusted effective tax rate for 2025 will be between 23.25% and 25.25%.

A reconciliation of forward-looking Adjusted EBITDA and Adjusted diluted EPS to the corresponding GAAP financial measures is not available without unreasonable effort due primarily to variability and difficulty in making accurate forecasts and projections of certain non-operating items such as (Gain) loss on investments, net, Other (income) loss, net, and other unanticipated items that may arise in the future.

SEGMENT REALIGNMENT

Following changes to our internal reporting structure, the Company concluded that it has five operating segments, which are now presented as the following five reportable segments: 1) Technology & Shopping, 2) Gaming & Entertainment, 3) Health & Wellness, 4) Connectivity, and 5) Cybersecurity & Martech. Prior period segment information is presented on a comparable basis to conform to this new segment presentation with no effect on previously reported consolidated results.

EARNINGS CONFERENCE CALL AND AUDIO WEBCAST

Ziff Davis will host a live audio webcast and conference call discussing its fourth quarter and year-end 2024 financial results on Tuesday, February 25, 2025, at 8:30AM ET. The live webcast and call will be accessible by phone by dialing (844) 985-2014 or via www.ziffdavis.com. Following the event, the audio recording and presentation materials will be archived and made available at www.ziffdavis.com.

ABOUT ZIFF DAVIS

Ziff Davis, Inc. (NASDAQ: ZD) is a vertically focused digital media and internet company whose portfolio includes leading brands in technology, shopping, gaming and entertainment, health and wellness, connectivity, cybersecurity, and martech. For more information, visit www.ziffdavis.com.

“Safe Harbor” Statement Under the Private Securities Litigation Reform Act of 1995: Certain statements in this press release are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including those contained in Vivek Shah’s quote, the “Ziff Davis Guidance” section regarding the Company’s expected fiscal 2025 financial performance, and our discussion of net cash provided by operating activities and free cash flow. These forward-looking statements are based on management’s current expectations or beliefs and are subject to numerous assumptions, risks, and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. These factors and uncertainties include, among other items: the Company’s ability to grow advertising, licensing, and subscription revenues, profitability, and cash flows, particularly in light of an uncertain U.S. or worldwide economy, including the possibility of economic downturn or recession; the Company’s ability to make interest and debt payments; the Company’s ability to identify, close, and successfully transition acquisitions; customer growth and retention; the Company’s ability to create compelling content; our reliance on third-party platforms; the threat of content piracy and developments related to artificial intelligence; increased competition and rapid technological changes; variability of the Company’s revenue based on changing conditions in particular industries and the economy generally; protection of the Company’s proprietary technology or infringement by the Company of intellectual property of others; the risk of losing critical third-party vendors or key personnel; the risks associated with fraudulent activity, system failure, or a security breach; risks related to our ability to adhere to our internal controls and procedures; the risk of adverse changes in the U.S. or international regulatory environments, including but not limited to the imposition or increase of taxes or regulatory-related fees; the risks related to supply chain disruptions, inflationary conditions, and rising interest rates; the risk of liability for legal and other claims; and the numerous other factors set forth in Ziff Davis’ filings with the Securities and Exchange Commission (“SEC”). For a more detailed description of the risk factors and uncertainties affecting Ziff Davis, refer to our most recent Annual Report on Form 10-K and the other reports filed by Ziff Davis from time-to-time with the SEC, each of which is available at www.sec.gov. The forward-looking statements provided in this press release, including those contained in Vivek Shah’s quote, in the “Ziff Davis Guidance” portion regarding the Company’s expected fiscal 2025 financial performance, and our discussion of net cash provided by operating activities and free cash flows are based on limited information available to the Company at this time, which is subject to change. Although management’s expectations may change after the date of this press release, the Company undertakes no obligation to revise or update these statements.

 

ZIFF DAVIS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED, IN THOUSANDS)
 

 

December 31,

 

 

2024

 

 

 

2023

 

ASSETS

 

 

 

Cash and cash equivalents

$

505,880

 

 

$

737,612

 

Short-term investments

 

—

 

 

 

27,109

 

Accounts receivable, net of allowances of $8,148 and $6,871, respectively

 

660,223

 

 

 

337,703

 

Prepaid expenses and other current assets

 

105,966

 

 

 

88,570

 

Total current assets

 

1,272,069

 

 

 

1,190,994

 

Long-term investments

 

158,187

 

 

 

140,906

 

Property and equipment, net of accumulated depreciation of $361,710 and $327,015, respectively

 

197,216

 

 

 

188,169

 

Intangible assets, net

 

425,749

 

 

 

325,406

 

Goodwill

 

1,580,258

 

 

 

1,546,065

 

Deferred income taxes

 

7,487

 

 

 

8,731

 

Other assets

 

63,368

 

 

 

70,751

 

TOTAL ASSETS

$

3,704,334

 

 

$

3,471,022

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

Accounts payable and accrued expenses

$

670,769

 

 

$

216,936

 

Income taxes payable, current

 

19,715

 

 

 

14,458

 

Deferred revenue, current

 

199,664

 

 

 

184,549

 

Other current liabilities

 

9,499

 

 

 

15,890

 

Total current liabilities

 

899,647

 

 

 

431,833

 

Long-term debt

 

864,282

 

 

 

1,001,312

 

Deferred revenue, noncurrent

 

5,504

 

 

 

8,169

 

Income taxes payable, noncurrent

 

—

 

 

 

8,486

 

Liability for uncertain tax positions

 

30,296

 

 

 

36,055

 

Deferred income taxes

 

46,018

 

 

 

45,503

 

Other noncurrent liabilities

 

47,705

 

 

 

46,666

 

TOTAL LIABILITIES

 

1,893,452

 

 

 

1,578,024

 

 

 

 

 

Common stock

 

428

 

 

 

461

 

Additional paid-in capital

 

491,891

 

 

 

472,201

 

Retained earnings

 

1,401,034

 

 

 

1,491,956

 

Accumulated other comprehensive loss

 

(82,471

)

 

 

(71,620

)

TOTAL STOCKHOLDERS’ EQUITY

 

1,810,882

 

 

 

1,892,998

 

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

$

3,704,334

 

 

$

3,471,022

 
 

ZIFF DAVIS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED, IN THOUSANDS EXCEPT SHARE AND PER SHARE DATA)
 

 

Three months ended

December 31,

 

Years ended

December 31,

 

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

Total revenues

$

412,823

 

 

$

389,885

 

 

$

1,401,688

 

 

$

1,364,028

 

Operating costs and expenses:

 

 

 

 

 

 

 

Direct costs

 

53,242

 

 

 

45,070

 

 

 

200,323

 

 

 

185,650

 

Sales and marketing

 

150,510

 

 

 

126,449

 

 

 

519,694

 

 

 

487,365

 

Research, development, and engineering

 

17,549

 

 

 

15,532

 

 

 

67,373

 

 

 

68,860

 

General, administrative, and other related costs

 

53,029

 

 

 

52,483

 

 

 

203,461

 

 

 

195,726

 

Depreciation and amortization

 

59,971

 

 

 

69,631

 

 

 

211,916

 

 

 

236,966

 

Goodwill impairment

 

—

 

 

 

—

 

 

 

85,273

 

 

 

56,850

 

Total operating costs and expenses

 

334,301

 

 

 

309,165

 

 

 

1,288,040

 

 

 

1,231,417

 

Income from operations

 

78,522

 

 

 

80,720

 

 

 

113,648

 

 

 

132,611

 

Interest expense, net

 

(6,391

)

 

 

(2,251

)

 

 

(13,988

)

 

 

(20,031

)

Loss on sale of businesses

 

—

 

 

 

—

 

 

 

(3,780

)

 

 

—

 

Income (loss) on investments, net

 

—

 

 

 

1,065

 

 

 

(7,654

)

 

 

(28,138

)

Other income (loss), net

 

2,438

 

 

 

(3,486

)

 

 

4,968

 

 

 

(9,468

)

Income before income tax expense and income (loss) from equity method investment

 

74,569

 

 

 

76,048

 

 

 

93,194

 

 

 

74,974

 

Income tax expense

 

(13,610

)

 

 

(12,962

)

 

 

(41,370

)

 

 

(24,142

)

Income (loss) from equity method investment, net of tax

 

3,128

 

 

 

336

 

 

 

11,223

 

 

 

(9,329

)

Net income

$

64,087

 

 

$

63,422

 

 

$

63,047

 

 

$

41,503

 

 

 

 

 

 

 

 

 

Net income per common share:

 

 

 

 

 

 

 

Basic

$

1.51

 

 

$

1.39

 

 

$

1.42

 

 

$

0.89

 

Diluted

$

1.43

 

 

$

1.29

 

 

$

1.42

 

 

$

0.89

 

Weighted average shares outstanding:

 

 

 

 

 

 

 

Basic

 

42,577,188

 

 

 

45,772,689

 

 

 

44,457,071

 

 

 

46,400,941

 

Diluted

 

46,690,090

 

 

 

50,985,086

 

 

 

44,519,693

 

 

 

46,464,261

 
 

ZIFF DAVIS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED, IN THOUSANDS)
 

 

Years ended December 31,

 

 

2024

 

 

 

2023

 

Cash flows from operating activities:

 

 

 

Net income

$

63,047

 

 

$

41,503

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

Depreciation and amortization

 

211,916

 

 

 

236,966

 

Non-cash operating lease costs

 

10,923

 

 

 

11,141

 

Share-based compensation

 

40,915

 

 

 

31,920

 

Provision for credit losses on accounts receivable

 

2,898

 

 

 

2,809

 

Deferred income taxes, net

 

(18,822

)

 

 

(30,017

)

Loss on sale of businesses

 

3,780

 

 

 

—

 

Goodwill impairment

 

85,273

 

 

 

56,850

 

Changes in fair value of contingent consideration

 

—

 

 

 

(200

)

(Income) loss from equity method investments

 

(11,223

)

 

 

9,329

 

Loss on investment, net

 

7,654

 

 

 

28,138

 

Other

 

3,601

 

 

 

5,159

 

Decrease (increase) in:

 

 

 

Accounts receivable

 

(153,121

)

 

 

(35,371

)

Prepaid expenses and other current assets

 

(17,153

)

 

 

(8,700

)

Other assets

 

11,367

 

 

 

(5,574

)

Increase (decrease) in:

 

 

 

Accounts payable

 

171,280

 

 

 

9,419

 

Deferred revenue

 

5,043

 

 

 

(6,802

)

Accrued liabilities and other current liabilities

 

(27,063

)

 

 

(26,608

)

Net cash provided by operating activities

 

390,315

 

 

 

319,962

 

Cash flows from investing activities:

 

 

 

Purchases of property and equipment

 

(106,635

)

 

 

(108,729

)

Acquisition of businesses, net of cash received

 

(217,570

)

 

 

(9,492

)

Purchase of equity investments

 

—

 

 

 

(11,858

)

Proceeds from sale of equity investments

 

19,455

 

 

 

3,174

 

Proceeds from sale of businesses, net of cash divested

 

7,860

 

 

 

—

 

Other

 

(565

)

 

 

(503

)

Net cash used in investing activities

 

(297,455

)

 

 

(127,408

)

Cash flows from financing activities:

 

 

 

Payment of debt

 

(134,989

)

 

 

—

 

Debt extinguishment costs

 

(277

)

 

 

—

 

Repurchase of common stock

 

(185,181

)

 

 

(108,527

)

Issuance of common stock under employee stock purchase plan

 

8,371

 

 

 

8,727

 

Deferred payments for acquisitions

 

(7,842

)

 

 

(15,241

)

Other

 

(1,076

)

 

 

250

 

Net cash used in financing activities

 

(320,994

)

 

 

(114,791

)

Effect of exchange rate changes on cash and cash equivalents

 

(3,598

)

 

 

7,056

 

Net change in cash and cash equivalents

 

(231,732

)

 

 

84,819

 

Cash and cash equivalents at beginning of year

 

737,612

 

 

 

652,793

 

Cash and cash equivalents at end of year

$

505,880

 

 

$

737,612

 
 

Non-GAAP Financial Measures

To supplement our condensed consolidated financial statements, which are prepared and presented in accordance with U.S. generally accepted accounting principles (“GAAP”), we use the following non-GAAP financial measures: Adjusted EBITDA, Adjusted EBITDA margin, Adjusted net income (loss), Adjusted net income (loss) per diluted share, Free cash flow, and Adjusted effective tax rate (collectively the “non-GAAP financial measures”). The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.

We use these non-GAAP financial measures for financial and operational decision making and as a means to evaluate period-to-period comparisons. We believe that these non-GAAP financial measures provide meaningful supplemental information regarding our performance and liquidity by excluding certain items that may not be indicative of our recurring core business operating results or, in certain cases, may be non-cash in nature. We believe that both management and investors benefit from referring to these non-GAAP financial measures in assessing our performance and when planning, forecasting, and analyzing future periods. These non-GAAP financial measures also facilitate management’s internal comparisons to our historical performance and liquidity. We believe these non-GAAP financial measures are useful to investors both because (1) they allow for greater transparency with respect to key metrics used by management in its financial and operational decision-making, (2) certain measures are used to determine the amount of annual incentive compensation paid to our named executive officers, and (3) they are used by the analyst community to help them analyze the health of our business.

These non-GAAP financial measures are not measures presented in accordance with GAAP, and our use of these terms may vary from that of other companies, limiting their usefulness for comparison purposes. These non-GAAP financial measures are not based on any comprehensive set of accounting rules or principles. These non-GAAP financial measures have limitations in that they do not reflect all of the amounts associated with the Company’s results of operations determined in accordance with GAAP.

Non-GAAP financial measures exclude the certain items listed below. We believe that excluding these items from the non-GAAP measures facilitates comparisons to historical operating results and comparisons to peers, many of which exclude similar items. We believe that non-GAAP financial measures provide meaningful supplemental information regarding operational performance. We further believe these measures are useful to investors in that they allow for greater transparency of certain line items in the Company’s financial statements.

Adjusted EBITDA is defined as Net income (loss) with adjustments to reflect the addition or elimination of certain items including, but not limited to:

  • Interest expense, net. Interest expense is generated primarily from interest due on outstanding debt, partially offset by interest income generated from the interest earned on cash, cash equivalents, and investments;

  • (Gain) loss on debt extinguishment, net. This is a non-cash expense that relates to extinguishments of long-term debt obligations. We believe this (gain) loss does not represent recurring core business operating results of the Company;

  • (Gain) loss on sale of business. This gain or loss relates to the sales of businesses and does not represent recurring core business operating results of the Company;

  • (Gain) loss on investments, net. This item includes realized gains and losses, unrealized gains and losses, and impairment charges on debt and equity investments. The amount of gain or loss depends on the share price for investments with readily determinable fair value and on observable price changes for investments without a readily determinable fair value, and does not represent core business operating results of the Company;

  • Other (income) loss, net. This income or expense relates to other non-operating items and does not represent recurring core business operating results of the Company;

  • Income tax (benefit) expense. This benefit or expense depends on the pre-tax loss or income of the Company, statutory tax rates, tax regulations, and different tax rates in various jurisdictions in which the Company operates and which the Company does not have the control over;

  • (Income) loss from equity method investments, net. This is a non-cash expense as it relates primarily to our investment in OCV Fund I, LP (the “Fund”). We believe that gain or loss resulting from our equity method investment does not represent core business operating results of the Company;

  • Depreciation and amortization. This is a non-cash expense at it relates to use and associated reduction in value of certain assets including equipment, fixtures, and certain capitalized internal-used software and website development costs, and identifiable definite-lived intangible assets of the acquired businesses;

  • Share-based compensation. This is a non-cash expense as it relates to awards granted under the various share-based incentive plans of the Company. We view the economic cost of share-based awards to be the dilution to our share base;

  • Acquisition, integration, and other costs. Includes adjustments to contingent consideration, lease terminations, retention bonuses, other acquisition-specific items, and other costs, such as severance, third-party debt modification costs and legal settlements. These expenses do not represent core business operating results of the Company;

  • Disposal related costs. These are expenses associated with the disposal of certain businesses that do not represent core business operating results of the Company;

  • Lease asset impairments and other charges. These expenses are incurred in connection with impaired right-of-use (“ROU”) assets of the Company. Associated expenses are comprised of insurance, utility, and other charges related to assets that are no longer in use, and partially offset by the sublease income earned. These expenses do not represent core business operating results of the Company; and

  • Goodwill impairment. This is a non-cash expense that is recorded when the carrying value of the reporting unit exceeds its fair value and does not represent core business operating results of the Company.

Adjusted EBITDA margin is calculated by dividing Adjusted EBITDA by Total revenues.

Adjusted net income (loss) is defined as Net income (loss) with adjustments to reflect the addition or elimination of certain statement of operations items including, but not limited to:

  • Interest, net. This reflects the difference between the imputed and coupon interest expense associated with the 4.625% Senior Notes and a charge that the Company determined to be penalty interest associated with the 1.75% Convertible Notes, offset in part by a certain interest income earned by the Company. These net expenses do not represent core business operating results of the Company;

  • (Gain) loss on debt extinguishment, net. This is a non-cash expense that relates to extinguishments of long-term debt obligations. We believe this gain or loss does not represent recurring core business operating results of the Company;

  • (Gain) loss on sale of business. This gain or loss relates to the sales of businesses and does not represent recurring core business operating results of the Company;

  • (Gain) loss on investments, net. This item includes realized gains and losses, unrealized gains and losses, and impairment charges on debt and equity investments. The amount of gain or loss depends on the share price for investments with readily determinable fair value and on observable price changes for investments without a readily determinable fair value, and does not represent core business operating results of the Company;

  • (Income) loss from equity method investments, net. This is a non-cash income or expense as it relates primarily to our investment in the OCV Fund. We believe that gains or losses resulting from our equity method investment do not represent core business operating results of the Company;

  • Amortization. Includes the amortization of patents and intangible assets that we acquired. This is a non-cash expense as it primarily relates to identifiable definite-lived intangible assets of the acquired businesses. We believe that acquired intangible assets represent cost incurred by the acquiree to build value prior to the acquisition and the amortization of this cost does not represent core business operating results of the Company;

  • Share-based compensation. This is a non-cash expense as it relates to awards granted under the various incentive plans of the Company. We view the economic cost of share-based awards to be the dilution to our share base;

  • Acquisition, integration, and other costs. Includes adjustments to contingent consideration, lease terminations, retention bonuses, other acquisition-specific items, and other costs, such as severance, third-party debt modification costs and legal settlements. These expenses do not represent core business operating results of the Company;

  • Disposal related costs. These are expenses associated with the disposal of certain businesses that do not represent core business operating results of the Company;

  • Lease asset impairments and other charges. These expenses are incurred in connection with impaired ROU assets of the Company. Associated expenses are comprised of insurance, utility, and other charges related to assets that are no longer in use, and partially offset by the sublease income earned. These expenses do not represent core business operating results of the Company; and

  • Goodwill impairment. This is a non-cash expense that is recorded when the carrying value of the reporting unit exceeds its fair value and does not represent core business operating results of the Company.

Adjusted net income (loss) per diluted share is calculated by dividing Adjusted net income (loss) by the diluted weighted average shares of common stock outstanding excluding the effect of convertible debt dilution.

Free cash flow is defined as Net cash provided by operating activities, less purchases of property and equipment, plus changes in contingent consideration (if any).

Adjusted effective tax rate is calculated based upon the GAAP effective tax rate with adjustments for the tax applicable to non-GAAP adjustments to Net income (loss), generally based upon the effective marginal tax rate of each adjustment.

 

ZIFF DAVIS, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES

(UNAUDITED, IN THOUSANDS)
 

The following table sets forth a reconciliation of Net income to Adjusted EBITDA:
 

 

Three months ended December 31,

 

Years ended December 31,

 

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

Net income

$

64,087

 

 

$

63,422

 

 

$

63,047

 

 

$

41,503

Interest expense, net

 

6,391

 

 

 

2,251

 

 

 

13,988

 

 

 

20,031

Loss on sale of businesses

 

—

 

 

 

—

 

 

 

3,780

 

 

 

—

(Income) loss on investment, net

 

—

 

 

 

(1,065

)

 

 

7,654

 

 

 

28,138

Other (income) loss, net

 

(2,438

)

 

 

3,486

 

 

 

(4,968

)

 

 

9,468

Income tax expense

 

13,610

 

 

 

12,962

 

 

 

41,370

 

 

 

24,142

(Income) loss from equity method investments, net

 

(3,128

)

 

 

(336

)

 

 

(11,223

)

 

 

7,829

Depreciation and amortization

 

59,971

 

 

 

69,633

 

 

 

211,916

 

 

 

236,966

Share-based compensation

 

10,282

 

 

 

7,527

 

 

 

40,915

 

 

 

31,920

Acquisition, integration, and other costs

 

23,386

 

 

 

9,649

 

 

 

40,194

 

 

 

21,000

Disposal related costs

 

(350

)

 

 

375

 

 

 

201

 

 

 

2,217

Lease asset impairments and other charges

 

(9

)

 

 

(338

)

 

 

1,361

 

 

 

2,245

Goodwill impairment

 

—

 

 

 

—

 

 

 

85,273

 

 

 

56,850

Adjusted EBITDA

$

171,802

 

 

$

167,566

 

 

$

493,508

 

 

$

482,309
 

ZIFF DAVIS, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES

(UNAUDITED, IN THOUSANDS)

 

The following table sets forth Revenues and a reconciliation of Income (loss) from operations to Adjusted EBITDA by segment:
 

 

Three months ended December 31, 2024

 

Technology &

Shopping

 

Gaming &

Entertainment

 

Health &

Wellness

 

Connectivity

 

Cybersecurity

& Martech

 

Corporate (1)

 

Total

Revenues

$

132,922

 

 

$

50,941

 

$

105,671

 

$

54,248

 

$

69,041

 

$

—

 

 

$

412,823

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) from operations

$

22,245

 

 

$

20,244

 

$

27,058

 

$

17,500

 

$

9,095

 

$

(17,620

)

 

$

78,522

 

Depreciation and amortization

 

25,313

 

 

 

2,869

 

 

13,849

 

 

9,397

 

 

8,505

 

 

38

 

 

 

59,971

 

Share-based compensation

 

1,164

 

 

 

190

 

 

1,411

 

 

638

 

 

1,097

 

 

5,782

 

 

 

10,282

 

Acquisition, integration, and other costs

 

9,710

 

 

 

1,323

 

 

4,509

 

 

1,987

 

 

3,587

 

 

2,270

 

 

 

23,386

 

Disposal related costs

 

—

 

 

 

—

 

 

—

 

 

—

 

 

—

 

 

(350

)

 

 

(350

)

Lease asset impairments and other charges

 

(179

)

 

 

94

 

 

—

 

 

—

 

 

76

 

 

—

 

 

 

(9

)

Goodwill impairment

 

—

 

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

 

—

 

Adjusted EBITDA

$

58,253

 

 

$

24,720

 

$

46,827

 

$

29,522

 

$

22,360

 

$

(9,880

)

 

$

171,802

 

 

Three months ended December 31, 2023

 

Technology &

Shopping

 

Gaming &

Entertainment

 

Health &

Wellness

 

Connectivity

 

 

Cybersecurity

& Martech

 

Corporate (1)

 

Total

Revenues

$

105,222

 

 

$

49,230

 

$

106,449

 

$

57,038

 

$

71,946

 

$

—

 

 

$

389,885

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) from operations

$

25,621

 

 

$

22,147

 

$

24,169

 

$

17,281

 

$

5,430

 

$

(13,928

)

 

$

80,720

 

Depreciation and amortization

 

19,569

 

 

 

2,067

 

 

18,074

 

 

11,456

 

 

18,457

 

 

10

 

 

 

69,633

 

Share-based compensation

 

1,001

 

 

 

80

 

 

1,136

 

 

419

 

 

932

 

 

3,959

 

 

 

7,527

 

Acquisition, integration, and other costs

 

4,114

 

 

 

551

 

 

3,421

 

 

1,109

 

 

420

 

 

34

 

 

 

9,649

 

Disposal related costs

 

180

 

 

 

—

 

 

—

 

 

—

 

 

—

 

 

195

 

 

 

375

 

Lease asset impairments and other charges

 

(663

)

 

 

—

 

 

34

 

 

—

 

 

206

 

 

85

 

 

 

(338

)

Adjusted EBITDA

$

49,822

 

 

$

24,845

 

$

46,834

 

$

30,265

 

$

25,445

 

$

(9,645

)

 

$

167,566

 

_______________________

Figures above are net of inter-segment revenues and operating costs and expenses.

(1)

Corporate includes certain unallocated overhead costs that were historically presented within the Digital Media reportable segment.
 

ZIFF DAVIS, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES

(UNAUDITED, IN THOUSANDS)
 

 

Year ended December 31, 2024

 

Technology &

Shopping

 

Gaming &

Entertainment

 

Health &

Wellness

 

Connectivity

 

Cybersecurity

& Martech

 

Corporate (1)

 

Total

Revenues

$

361,882

 

 

$

180,276

 

$

362,408

 

$

213,620

 

 

$

283,502

 

$

—

 

 

$

1,401,688

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Loss) income from operations

$

(71,072

)

 

$

54,001

 

$

67,207

 

$

79,374

 

 

$

54,961

 

$

(70,823

)

 

$

113,648

Depreciation and amortization

 

83,424

 

 

 

10,733

 

 

52,766

 

 

31,882

 

 

 

33,025

 

 

86

 

 

 

211,916

Share-based compensation

 

5,014

 

 

 

1,070

 

 

5,604

 

 

2,658

 

 

 

4,631

 

 

21,938

 

 

 

40,915

Acquisition, integration, and other costs

 

18,554

 

 

 

2,727

 

 

9,788

 

 

(3,823

)

 

 

5,395

 

 

7,553

 

 

 

40,194

Disposal related costs

 

(24

)

 

 

—

 

 

—

 

 

—

 

 

 

20

 

 

205

 

 

 

201

Lease asset impairments and other charges

 

223

 

 

 

93

 

 

15

 

 

—

 

 

 

756

 

 

274

 

 

 

1,361

Goodwill impairment

 

85,273

 

 

 

—

 

 

—

 

 

—

 

 

 

—

 

 

—

 

 

 

85,273

Adjusted EBITDA

$

121,392

 

 

$

68,624

 

$

135,380

 

$

110,091

 

 

$

98,788

 

$

(40,767

)

 

$

493,508

 

Year ended December 31, 2023

 

Technology &

Shopping

 

Gaming &

Entertainment

 

Health &

Wellness

 

Connectivity

 

Cybersecurity

& Martech

 

Corporate (1)

 

Total

Revenues

$

330,557

 

 

$

168,821

 

$

361,923

 

$

211,518

 

$

291,209

 

$

—

 

 

$

1,364,028

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Loss) income from operations

$

(50,498

)

 

$

57,299

 

$

63,575

 

$

70,591

 

$

43,210

 

$

(51,566

)

 

$

132,611

 

Income from equity method investment, net

 

—

 

 

 

—

 

 

—

 

 

—

 

 

—

 

 

(1,500

)

 

 

(1,500

)

Depreciation and amortization

 

83,271

 

 

 

10,368

 

 

59,870

 

 

31,793

 

 

52,618

 

 

(954

)

 

 

236,966

 

Share-based compensation

 

4,941

 

 

 

758

 

 

4,843

 

 

2,014

 

 

4,186

 

 

15,178

 

 

 

31,920

 

Acquisition, integration, and other costs

 

4,452

 

 

 

2,441

 

 

10,004

 

 

2,820

 

 

887

 

 

396

 

 

 

21,000

 

Disposal related costs

 

633

 

 

 

—

 

 

—

 

 

—

 

 

202

 

 

1,382

 

 

 

2,217

 

Lease asset impairments and other charges

 

1,019

 

 

 

—

 

 

510

 

 

—

 

 

471

 

 

245

 

 

 

2,245

 

Goodwill impairment

 

56,850

 

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

 

56,850

 

Adjusted EBITDA

$

100,668

 

 

$

70,866

 

$

138,802

 

$

107,218

 

$

101,574

 

$

(36,819

)

 

$

482,309

 

_______________________

Figures above are net of inter-segment revenues and operating costs and expenses.

(1)

Corporate includes certain unallocated overhead costs that were historically presented within the Digital Media reportable segment.
 

ZIFF DAVIS, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES

(UNAUDITED, IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

 

The following tables set forth a reconciliation of Net income to Adjusted net income with adjustments presented on after-tax basis:
 

 

Three months ended December 31,

 

 

2024

 

 

Per diluted

share*

 

 

2023

 

 

Per diluted

share*

Net income

$

64,087

 

 

$

1.43

 

 

$

63,422

 

 

$

1.29

 

Interest, net

 

60

 

 

 

—

 

 

 

(20

)

 

 

—

 

Loss on sale of business

 

—

 

 

 

—

 

 

 

276

 

 

 

0.01

 

Loss (income) on investments, net

 

942

 

 

 

0.02

 

 

 

(775

)

 

 

(0.02

)

Income from equity method investments, net

 

(3,128

)

 

 

(0.07

)

 

 

(336

)

 

 

(0.01

)

Amortization

 

25,040

 

 

 

0.59

 

 

 

31,105

 

 

 

0.68

 

Share-based compensation

 

5,178

 

 

 

0.12

 

 

 

6,289

 

 

 

0.14

 

Acquisition, integration, and other costs

 

18,265

 

 

 

0.43

 

 

 

7,011

 

 

 

0.15

 

Disposal related costs

 

(262

)

 

 

(0.01

)

 

 

238

 

 

 

0.01

 

Lease asset impairments and other charges

 

7

 

 

 

—

 

 

 

(224

)

 

 

—

 

Dilutive effect of the convertible debt

 

—

 

 

 

0.07

 

 

 

—

 

 

 

0.08

 

Adjusted net income

$

110,189

 

 

$

2.58

 

 

$

106,986

 

 

$

2.33

 
 

 

Years ended December 31,

 

 

2024

 

 

Per diluted

share*

 

2023

 

Per diluted

share*

Net income

$

63,047

 

 

$

1.42

 

$

41,503

 

$

0.89

Interest, net

 

132

 

 

 

—

 

 

5,881

 

 

0.13

Loss on sale of business

 

103

 

 

 

—

 

 

3,797

 

 

0.08

Loss on investments, net

 

8,019

 

 

 

0.18

 

 

21,103

 

 

0.45

(Income) loss from equity method investments, net

 

(11,223

)

 

 

(0.25

)

 

8,204

 

 

0.18

Amortization

 

87,052

 

 

 

1.96

 

 

106,593

 

 

2.30

Share-based compensation

 

31,013

 

 

 

0.70

 

 

27,100

 

 

0.58

Acquisition, integration, and other costs

 

29,805

 

 

 

0.67

 

 

13,498

 

 

0.29

Disposal related costs

 

195

 

 

 

—

 

 

1,538

 

 

0.03

Lease asset impairments and other charges

 

1,045

 

 

 

0.02

 

 

1,295

 

 

0.04

Goodwill impairment

 

85,273

 

 

 

1.92

 

 

56,850

 

 

1.22

Adjusted net income

$

294,461

 

 

$

6.62

 

$

287,362

 

$

6.19

_______________________

*

The reconciliation of Net income per diluted share to Adjusted net income per diluted share may not foot since each is calculated independently.
 

ZIFF DAVIS, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES

(UNAUDITED, IN THOUSANDS)

 

The following are the adjustments to certain statement of operations items used to derive Adjusted net income, which we believe provide useful information about our operating results and enhance the overall understanding of past financial performance and future prospects of the Company.
 

 

Three months ended December 31, 2024

 

GAAP amount

Adjustments

Adjusted

non-GAAP amount

 

Interest, net

(Gain) loss on sale of business

(Gain) loss on investments, net

(Income) loss from equity method investments, net

Amortization

Share-based compensation

Acquisition, integration, and other costs

Disposal related costs

Lease asset impairments and other charges

Goodwill impairment

Direct costs

$

(53,242

)

$

—

 

$

—

$

—

$

—

 

$

—

 

$

57

 

$

425

 

$

—

 

$

—

 

$

—

$

(52,760

)

Sales and marketing

$

(150,510

)

 

—

 

 

—

 

—

 

—

 

 

—

 

 

891

 

 

13,366

 

 

—

 

 

—

 

 

—

$

(136,253

)

Research, development, and engineering

$

(17,549

)

 

—

 

 

—

 

—

 

—

 

 

—

 

 

735

 

 

3,926

 

 

—

 

 

—

 

 

—

$

(12,888

)

General, administrative, and other related costs

$

(53,029

)

 

—

 

 

—

 

—

 

—

 

 

—

 

 

8,599

 

 

5,669

 

 

(350

)

 

(9

)

 

—

$

(39,120

)

Depreciation and amortization

$

(59,971

)

 

—

 

 

—

 

—

 

—

 

 

34,965

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

$

(25,006

)

Goodwill impairment

$

—

 

 

—

 

 

—

 

—

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

$

—

 

Interest expense, net

$

(6,391

)

 

80

 

 

—

 

—

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

$

(6,311

)

Other income, net

$

2,438

 

 

—

 

 

—

 

—

 

—

 

 

—

 

 

—

 

 

(237

)

 

—

 

 

—

 

 

—

$

2,201

 

Income tax expense (1)

$

(13,610

)

 

(20

)

 

—

 

942

 

—

 

 

(9,925

)

 

(5,104

)

 

(4,884

)

 

88

 

 

16

 

 

—

$

(32,497

)

Loss from equity method investment, net

$

3,128

 

 

—

 

 

—

 

—

 

(3,128

)

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

$

—

 

Total non-GAAP adjustments

 

$

60

 

$

—

$

942

$

(3,128

)

$

25,040

 

$

5,178

 

$

18,265

 

$

(262

)

$

7

 

$

—

 

_______________________

(1)

Adjusted effective tax rate was approximately 22.8% for the three months ended December 31, 2024. The calculation is based on a ratio where the numerator is the adjusted income tax expense of $32,497 and the denominator is $142,686, which equals adjusted net income of $110,189 plus adjusted income tax expense.
 

ZIFF DAVIS, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES

(UNAUDITED, IN THOUSANDS)
 

 

Three months ended December 31, 2023

 

GAAP amount

Adjustments

Adjusted

non-GAAP amount

 

Interest, net

(Gain) loss on sale of business

(Gain) loss on investments, net

(Income) loss from equity method investments, net

Amortization

Share-based compensation

Acquisition, integration, and other costs

Disposal related costs

Lease asset impairments and other charges

Goodwill impairment

Direct costs

$

(45,070

)

$

—

 

$

—

 

$

—

 

$

—

 

$

—

 

$

15

 

$

2,561

 

$

—

 

$

—

 

$

—

$

(42,494

)

Sales and marketing

$

(126,449

)

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

392

 

 

1,668

 

 

—

 

 

—

 

 

—

$

(124,389

)

Research, development, and engineering

$

(15,532

)

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

660

 

 

177

 

 

—

 

 

—

 

 

—

$

(14,695

)

General, administrative, and other related costs

$

(52,483

)

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

6,460

 

 

5,243

 

 

375

 

 

(338

)

 

—

$

(40,743

)

Depreciation and amortization

$

(69,631

)

 

—

 

 

—

 

 

—

 

 

—

 

 

44,991

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

$

(24,640

)

Goodwill impairment

$

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

$

—

 

Interest expense, net

$

(2,251

)

 

(11

)

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

$

(2,262

)

Gain on investments, net

$

1,065

 

 

—

 

 

—

 

 

(1,065

)

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

$

—

 

Other loss, net

$

(3,486

)

 

—

 

 

422

 

 

 

—

 

 

—

 

 

—

 

 

459

 

 

—

 

 

—

 

 

—

$

(2,605

)

Income tax expense (1)

$

(12,962

)

 

(9

)

 

(146

)

 

290

 

 

—

 

 

(13,886

)

 

(1,238

)

 

(3,097

)

 

(137

)

 

114

 

 

—

$

(31,071

)

Income from equity method investment, net

$

336

 

 

—

 

 

—

 

 

—

 

 

(336

)

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

$

—

 

Total non-GAAP adjustments

 

$

(20

)

$

276

 

$

(775

)

$

(336

)

$

31,105

 

$

6,289

 

$

7,011

 

$

238

 

$

(224

)

$

—

 

_______________________

(1)

 

Adjusted effective tax rate was approximately 22.5% for the three months ended December 31, 2023. The calculation is based on a ratio where the numerator is the adjusted income tax expense of $31,071 and the denominator is $138,057, which equals adjusted net income of $106,986 plus adjusted income tax expense.

 

 

  

ZIFF DAVIS, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES

(UNAUDITED, IN THOUSANDS)
 

 

Year ended December 31, 2024

 

GAAP amount

Adjustments

Adjusted non-GAAP amount

 

Interest, net

(Gain) loss on sale of business

(Gain) loss on investments, net

(Income) loss from equity method investments, net

Amortization

Share-based compensation

Acquisition, integration, and other costs

Disposal related costs

Lease asset impairments and other charges

Goodwill impairment

Direct costs

$

(200,323

)

$

—

 

$

—

 

$

—

$

—

 

$

—

 

$

248

 

$

760

 

$

—

 

$

—

 

$

—

$

(199,315

)

Sales and marketing

$

(519,694

)

 

—

 

 

—

 

 

—

 

—

 

 

—

 

 

3,756

 

 

19,072

 

 

—

 

 

—

 

 

—

$

(496,866

)

Research, development, and engineering

$

(67,373

)

 

—

 

 

—

 

 

—

 

—

 

 

—

 

 

3,665

 

 

6,516

 

 

40

 

 

—

 

 

—

$

(57,152

)

General, administrative, and other related costs

$

(203,461

)

 

—

 

 

—

 

 

—

 

—

 

 

—

 

 

33,246

 

 

13,846

 

 

161

 

 

1,361

 

 

—

$

(154,847

)

Depreciation and amortization

$

(211,916

)

 

—

 

 

—

 

 

—

 

—

 

 

117,748

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

$

(94,168

)

Goodwill impairment

$

(85,273

)

 

—

 

 

—

 

 

—

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

85,273

$

—

 

Interest expense, net

$

(13,988

)

 

176

 

 

—

 

 

—

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

$

(13,812

)

Loss on sale of business

$

(3,780

)

 

—

 

 

3,780

 

 

—

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

$

—

 

Loss on investments, net

$

(7,654

)

 

—

 

 

—

 

 

7,654

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

$

—

 

Other income (loss), net

$

4,968

 

 

—

 

 

(4,903

)

 

—

 

—

 

 

—

 

 

—

 

 

(774

)

 

—

 

 

—

 

 

—

$

(709

)

Income tax expense (1)

$

(41,370

)

 

(44

)

 

1,226

 

 

365

 

—

 

 

(30,696

)

 

(9,902

)

 

(9,615

)

 

(6

)

 

(316

)

 

—

$

(90,358

)

Income from equity method investment, net

$

11,223

 

 

—

 

 

—

 

 

—

 

(11,223

)

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

$

—

 

Total non-GAAP adjustments

 

$

132

 

$

103

 

$

8,019

$

(11,223

)

$

87,052

 

$

31,013

 

$

29,805

 

$

195

 

$

1,045

 

$

85,273

 

_______________________

(1)

 

Adjusted effective tax rate was approximately 23.5% for the year ended December 31, 2024. The calculation is based on a ratio where the numerator is the adjusted income tax expense of $90,358 and the denominator is $384,819, which equals adjusted net income of $294,461 plus adjusted income tax expense.
 

ZIFF DAVIS, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES

(UNAUDITED, IN THOUSANDS)
 

 

Year ended December 31, 2023

 

GAAP amount

Adjustments

Adjusted non-GAAP amount

 

Interest, net

(Gain) loss on sale of business

(Gain) loss on investments, net

(Income) loss from equity method investments, net

Amortization

Share-based compensation

Acquisition, integration, and other costs

Disposal related costs

Lease asset impairments and other charges

Goodwill impairment

Direct costs

$

(185,650

)

$

—

 

$

—

 

$

—

 

$

—

 

$

—

 

$

262

 

$

2,752

 

$

—

 

$

—

 

$

—

$

(182,636

)

Sales and marketing

$

(487,365

)

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

2,686

 

 

4,796

 

 

4

 

 

—

 

 

—

$

(479,879

)

Research, development, and engineering

$

(68,860

)

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

3,245

 

 

712

 

 

3

 

 

—

 

 

—

$

(64,900

)

General, administrative, and other related costs

$

(195,726

)

 

—

 

 

—

 

 

—

 

 

(1,500

)

 

—

 

 

25,727

 

 

12,740

 

 

2,210

 

 

2,245

 

 

—

$

(154,304

)

Depreciation and amortization

$

(236,966

)

 

—

 

 

—

 

 

—

 

 

—

 

 

145,571

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

$

(91,395

)

Goodwill impairment

$

(56,850

)

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

56,850

$

—

 

Interest expense, net

$

(20,031

)

 

7,797

 

 

(538

)

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

$

(12,772

)

Loss on investments, net

$

(28,138

)

 

—

 

 

—

 

 

28,138

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

$

—

 

Other loss, net

$

(9,468

)

 

—

 

 

5,655

 

 

—

 

 

—

 

 

—

 

 

—

 

 

459

 

 

—

 

 

—

 

 

—

$

(3,354

)

Income tax expense (1)

$

(24,142

)

 

(1,916

)

 

(1,320

)

 

(7,035

)

 

375

 

 

(38,978

)

 

(4,820

)

 

(7,961

)

 

(679

)

 

(950

)

 

—

$

(87,426

)

Loss from equity method investment, net

$

(9,329

)

 

—

 

 

—

 

 

—

 

 

9,329

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

$

—

 

Total non-GAAP adjustments

 

$

5,881

 

$

3,797

 

$

21,103

 

$

8,204

 

$

106,593

 

$

27,100

 

$

13,498

 

$

1,538

 

$

1,295

 

$

56,850

 

_______________________

(1)

Adjusted effective tax rate was approximately 23.3% for the year ended December 31, 2023. The calculation is based on a ratio where the numerator is the adjusted income tax expense of $87,426 and the denominator is $374,788, which equals adjusted net income of $287,362 plus adjusted income tax expense.
 

ZIFF DAVIS, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES

(UNAUDITED, IN THOUSANDS)

 

The following tables set forth a reconciliation of Net cash provided by operating activities to Free cash flow:
 

2024

Q1

 

Q2

 

Q3

 

Q4

 

YTD

Net cash provided by operating activities

$

75,558

 

 

$

50,564

 

 

$

105,960

 

 

$

158,233

 

 

$

390,315

 

Less: Purchases of property and equipment

 

(28,129

)

 

 

(25,504

)

 

 

(25,843

)

 

 

(27,159

)

 

 

(106,635

)

Free cash flow

$

47,429

 

 

$

25,060

 

 

$

80,117

 

 

$

131,074

 

 

$

283,680

 
 

2023

Q1

Q2

Q3

Q4

YTD

Net cash provided by operating activities

$

115,307

 

$

39,728

 

$

72,808

 

$

92,119

 

$

319,962

 

Less: Purchases of property and equipment

 

(30,017

)

 

(25,233

)

 

(27,226

)

 

(26,253

)

 

(108,729

)

Free cash flow

$

85,290

 

$

14,495

 

$

45,582

 

$

65,866

 

$

211,233

 

 

Alan Steier

Investor Relations

Ziff Davis, Inc.

[email protected]

Rebecca Wright

Corporate Communications

Ziff Davis, Inc.

[email protected]

KEYWORDS: United States North America New York

INDUSTRY KEYWORDS: Media Online Entertainment Internet Search Engine Marketing Blogging Technology Digital Marketing Publishing Marketing Advertising Content Marketing Communications

MEDIA:

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Posted on

Apollo Announces 2025 Annual Meeting of Stockholders

NEW YORK, Feb. 24, 2025 (GLOBE NEWSWIRE) — Apollo (NYSE: APO) today announced that its 2025 Annual Meeting of Stockholders will be held virtually on June 6, 2025, at 9:30 am ET. The record date for the meeting is April 14, 2025. Information on the virtual meeting will be included in the 2025 proxy statement.

About Apollo

Apollo is a high-growth, global alternative asset manager. In our asset management business, we seek to provide our clients excess return at every point along the risk-reward spectrum from investment grade credit to private equity. For more than three decades, our investing expertise across our fully integrated platform has served the financial return needs of our clients and provided businesses with innovative capital solutions for growth. Through Athene, our retirement services business, we specialize in helping clients achieve financial security by providing a suite of retirement savings products and acting as a solutions provider to institutions. Our patient, creative, and knowledgeable approach to investing aligns our clients, businesses we invest in, our employees, and the communities we impact, to expand opportunity and achieve positive outcomes. As of December 31, 2024, Apollo had approximately $751 billion of assets under management. To learn more, please visit www.apollo.com.

Apollo Forward-Looking Statements

This press release may contain forward-looking statements that are within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements include, but are not limited to, discussions related to Apollo’s expectations regarding the performance of its business, liquidity and capital resources and the other non-historical statements. These forward-looking statements are based on management’s beliefs, as well as assumptions made by, and information currently available to, management. When used in this press release, the words “believe,” “anticipate,” “estimate,” “expect,” “intend,” “will,” “should,” “could,” or “may,” and similar expressions are intended to identify forward-looking statements. Although management believes that the expectations reflected in these forward-looking statements are reasonable, it can give no assurance that these expectations will prove to be correct. These statements are subject to certain risks, uncertainties and assumptions, including but not limited to those described under the section entitled “Risk Factors” in our Annual Report on Form 10-K filed with the United States Securities and Exchange Commission (“SEC”) on February 24, 2025, as such factors may be updated from time to time in Apollo’s periodic filings with the SEC, which are accessible on the SEC’s website at www.sec.gov. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in Apollo’s filings with the SEC. Apollo undertakes no obligation to publicly update or review any forward-looking statements, whether as a result of new information, future developments or otherwise, except as required by applicable law. This press release does not constitute an offer of any Apollo fund.

Contacts

Noah Gunn
Global Head of Investor Relations
Apollo Global Management, Inc.
(212) 822-0540
[email protected]

Joanna Rose
Global Head of Corporate Communications
Apollo Global Management, Inc.
(212) 822-0491
[email protected]



Posted on

Blend Joins the Jack Henry™ Vendor Integration Program

Blend Joins the Jack Henry™ Vendor Integration Program

VIP enables Blend to integrate with SilverLake System® and Symitar®

SAN FRANCISCO–(BUSINESS WIRE)–
Blend Labs, Inc., a leading origination platform for digital banking solutions, today announced that it has joined the Jack Henry™ Vendor Integration Program (VIP). Participation in the program will provide Blend with access to Jack Henry’s technical resources to enable Blend’s digital platform to integrate with SilverLake System® and Symitar®.

This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20250224967566/en/

(Graphic: Business Wire)

(Graphic: Business Wire)

The Vendor Integration Program is designed to help ensure that Jack Henry’s customers can easily deploy third-party products.

Blend’s digital platform integrates with SilverLake System via jXchange™, a services-based programming interface that enables third-party vendors and banks to access the platform’s core data and business rules. The integrity of data is maintained throughout any data exchange, because access to business rules and data is managed through a service layer that governs these interactions.

In addition, Blend’s digital platform integrates with Symitar via SymXchange™, which performs the same functions to connect third-party vendors with credit unions. As a VIP member, Blend gains direct access to Jack Henry’s technical resources and testing environments, significantly streamlining the development and validation of robust integrations.

This translates to faster deployment of Blend’s solution for lenders using these core systems, empowering them to quickly modernize their operations, enhance the applicant experience, and realize the full benefits of the integrated platform more rapidly. Financial institutions can rapidly modernize their deposit account opening operations, offering a more seamless and efficient experience for their accountholders.

“This expanded collaboration with Jack Henry showcases Blend’s deep commitment to developing proven integrations that enable banks and credit unions to support accountholder needs seamlessly and efficiently,” said Srini Venkatramani, Head of Product, Technology, and Client Operations at Blend. “By connecting Blend’s account opening solutions with Jack Henry’s robust core systems, banks and credit unions can leverage data to personalize the applicant journey, streamline operations, and ultimately deliver a better lending experience for everyone.”

Jack Henry’s VIP takes the accountholder out of the middle, providing vendors with direct access to Jack Henry’s technical resources and test systems. VIP inclusion is not an endorsement of the vendor’s product.

About Blend Labs, Inc.

Blend Labs, Inc. (NYSE: BLND) is a leading origination platform for digital banking solutions. Financial providers—from large banks, fintechs, and credit unions to community and independent mortgage banks—use Blend’s platform to transform banking experiences for their customers. Better banking starts on Blend. To learn more, visit blend.com.

About Jack Henry & Associates, Inc.®

Jack Henry™ (Nasdaq: JKHY) is a well-rounded financial technology company that strengthens connections between financial institutions and the people and businesses they serve. We are an S&P 500 company that prioritizes openness, collaboration, and user centricity – offering banks and credit unions a vibrant ecosystem of internally developed modern capabilities as well as the ability to integrate with leading fintechs. For more than 48 years, Jack Henry has provided technology solutions to enable clients to innovate faster, strategically differentiate, and successfully compete while serving the evolving needs of their accountholders. We empower approximately 7,500 clients with people-inspired innovation, personal service, and insight-driven solutions that help reduce the barriers to financial health. Additional information is available at jackhenry.com.

Forward-Looking Disclaimer

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements generally relate to future events, future performance or expectations and involve substantial risks and uncertainties. Forward-looking statements in this press release may include, but are not limited to, our expectations regarding our product roadmap, future products/features, the timing of new product/feature introductions, market size and growth opportunities, macroeconomics and industry conditions, capital expenditures, plans for future operations, competitive position, technological capabilities and strategic relationships, as well as assumptions relating to the foregoing. The forward-looking statements contained in this press release are subject to risks and uncertainties that could cause actual outcomes to differ materially from the outcomes predicted. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expect,” “plan,” “anticipate,” “could,” “would,” “intend,” “target,” “project,” “contemplate,” “believe,” “estimate,” “predict,” “potential” or “continue” or the negative of these terms or other comparable terminology that concern Blend’s expectations, strategy, plans or intentions. You should not put undue reliance on any forward-looking statements. Forward-looking statements should not be read as a guarantee of future performance or results and will not necessarily be accurate indications of the times at, or by which such performance or results will be achieved, if at all. Further information on these risks and uncertainties are set forth in our filings with the Securities and Exchange Commission. All forward-looking statements in this press release are based on information available to Blend and assumptions and beliefs as of the date hereof. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this press release. Except as required by law, Blend does not undertake any obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments, or otherwise.

Press Contact

Chloé Demeunynck

Corporate Communications

[email protected]

KEYWORDS: United States North America California

INDUSTRY KEYWORDS: Professional Services Technology Software Finance Electronic Commerce Fintech Banking

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MOORE LAW PLLC ENCOURAGES THE WALT DISNEY COMPANY (NYSE: DIS) INVESTORS TO CONTACT LAW FIRM

PR Newswire


NEW YORK
, Feb. 24, 2025 /PRNewswire/ — Moore Law, PLLC, a securities and shareholder law firm located on Wall Street, is investigating potential claims against:

  • THE WALT DISNEY COMPANY (NYSE: DIS)

Moore Law is investigating, among other things, certain stock sales or insider trading by Disney insiders that may been made while in possession of material non-public information. Los Angeles federal judge Consuelo B. Marshall recently denied in part a motion to dismiss a securities class action lawsuit against Disney and certain executives. 

Judge Marshall said the investors sufficiently pled “deceptive conduct” by the group of former executives who ran Disney+ during this time — then-CEO Bob Chapek, Chief Financial Officer Christine McCarthy and distribution head Kareem Daniel — as well as scienter and loss causation from the supposed stock inflation scheme.

The judge also kept alive a claim alleging McCarthy engaged in insider trading by selling off $17 million worth of her Disney holdings ahead of the stock drop. But Judge Marshall axed a similar insider trading claim against Iger, who was Disney’s executive chairman at the time and supposedly expressed private reservations about Chapek’s streaming growth predictions while unloading $375 million worth of his shares.

If you own THE WALT DISNEY COMPANY (NYSE: DIS) shares, you are encouraged to contact us at [email protected] or call (212) 709-8245. You may be able to seek monetary damages, corporate governance reforms, reimbursement to the company, and a court approved incentive award at no cost to you whatsoever.


ABOUT MOORE LAW PLLC

Moore Law is a NYC plaintiff contingency litigation law firm for investors. We hold officers and directors accountable for breaches of fiduciary duty, fraud, insider trading, wasteful spending, and other corporate misconduct. There is no cost to you ever.

We pride ourselves on 24/7 availability, same day email responses, and constant case updates.

MOORE LAW PLLC
30 Wall Street, 8th Floor
New York, NY 10005
(212) 709-8245
[email protected]
www.fmoorelaw.com

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SOURCE Moore Law PLLC

Posted on

Kuehn Law Encourages Investors of The Walt Disney Company to Contact Law Firm

NEW YORK, Feb. 24, 2025 (GLOBE NEWSWIRE) — Kuehn Law, PLLC, a shareholder litigation law firm, is investigating whether certain officers and directors of The Walt Disney Company (NYSE: DIS) breached their fiduciary duties to shareholders.

According to a federal securities lawsuit, Insiders at Disney caused the company to misrepresent or fail to disclose that (i) Disney+ was suffering decelerating subscriber growth, losses, and cost overruns; (ii) the true costs incurred in connection with Disney+ had been concealed by Disney executives by debuting certain content intended for Disney+ initially on Disney’s legacy distribution channels and then making the shows available on Disney+ thereafter to improperly shift costs out of the Disney+ segment; (iii) Disney had made platform distribution decisions based not on consumer preference, consumer behavior, or the desire to maximize the size of the audience for the content as represented, but based on the desire to hide the full costs of building Disney+’s content library; and (iv) Disney was not on track to achieve even the reduced 2024 Disney+ paid global subscriber and profitability targets, such targets were not achievable, and such estimates lacked a reasonable basis in fact.

If you currently own DIS and purchased prior to December 10, 2020 please contact Justin Kuehn, Esq. here, by email at [email protected] or call (833) 672-0814.  Kuehn Law pays all case costs and does not charge its investor clients.Shareholders should contact the firm immediately as there may be limited time to enforce your rights.  

Why Your Participation Matters:

As a shareholder your voice matters, and by getting involved, you contribute to the integrity and fairness of the financial markets. Your investment. Your voice. Your future.™  

For additional information, please visit Shareholder Derivative Litigation – Kuehn Law.

Attorney advertising. Prior results do not guarantee similar outcomes.

Contacts:
Kuehn Law, PLLC
Justin Kuehn, Esq.
53 Hill Street, Suite 605
Southampton, NY 11968
[email protected]
(833) 672-0814