Market Newsdesk

NW Natural Holdings Reports Fourth Quarter and Full Year 2024 Results

Initiated 2025 earnings guidance and reaffirmed long-term EPS growth rate target of 4-6%

PORTLAND, Ore.–(BUSINESS WIRE)–
Northwest Natural Holding Company (NYSE: NWN) (NW Natural Holdings) reported financial results and highlights including:

• Reported net income of $2.03 per share and achieved adjusted earnings¹ of $2.33 per share for 2024, compared to net income of $2.59 per share for 2023, a decline primarily due to regulatory lag for the first 10 months of 2024 until new Oregon gas utility rates were effective on Nov. 1, 2024

• Acquisition of SiEnergy, a high-growth gas utility located in Texas, signed and announced in November 2024 and subsequently closed in January 2025

• Invested $394.4 million in our utility systems to support greater reliability and resiliency

• Added nearly 10,000 gas and water utility connections in the last 12 months for a combined growth rate of 1.1% as of Dec. 31, 2024, mainly driven by organic customer growth from all utilities

• Closed Puttman/ICH water acquisition in September 2024, adding customers and a strong pipeline of growth opportunities

• Began operations, earnings and cash flows from two renewable natural gas (RNG) facilities for NW Natural Renewables

• Honored as one of the 2024 World’s Most Ethical Companies® by Ethisphere for the third year in a row²
• Increased our dividend for the 69^th consecutive year to an annual indicated dividend rate of $1.96 per share

• Initiated 2025 GAAP earnings per share (EPS) guidance of $2.66 to $2.86 and adjusted EPS guidance of $2.75 to $2.95

• Reaffirmed long-term EPS growth rate target of 4% to 6% from our expected 2025 adjusted EPS³

“For over 165 years, NW Natural Holdings has provided essential energy to the communities it serves. In 2024, we made great strides across all our businesses to continue growing and providing customers critical services well into the future,” said David H. Anderson, CEO of NW Natural Holdings. “I’m proud to provide 2025 guidance in line with our long-term financial targets and very excited to have SiEnergy join our Company. Our financial strength allows us to continue making substantial investments in our growing portfolio of gas and water utility systems to provide continued safe and reliable service for our customers. We remain focused on executing our long-term growth plan and providing value to customers, employees and shareholders.”

For 2024, NW Natural Holdings reported net income of $78.9 million (or $2.03 per share) and adjusted¹ net income of $90.6 million (or $2.33 per share), compared to $93.9 million (or $2.59 per share) for 2023. Results reflected higher pension expense, lower interest income, and an increase in depreciation expense, partially offset by new rates in Oregon for our natural gas utility beginning Nov. 1, 2024.

1 See “Non-GAAP Financial Measures” and “Reconciliation to GAAP” for additional information. The 2024 adjusted consolidated net income and adjusted EPS are non-GAAP and exclude the effects of a non-cash line extension regulatory disallowance of $10.1 million after-tax and SiEnergy transaction costs of $1.7 million after-tax.

2 “World’s Most Ethical Companies” and “Ethisphere” names and marks are registered trademarks of Ethisphere LLC

3 Adjusted EPS growth forecasted for period 2025 – 2030 compounded annually; EPS growth rate uses adjusted 2025 EPS as base year. NW Natural Holdings does not provide a reconciliation of adjusted EPS growth rate target to the most directly comparable GAAP measures due to the inherent difficulty in forecasting and quantifying certain significant items. These items are uncertain, depend on various factors and could have a material impact on GAAP reported results for the relevant period.

2025 GUIDANCE AND LONG-TERM TARGETS

NW Natural Holdings initiated 2025 GAAP EPS guidance of $2.66 to $2.86 and adjusted EPS guidance of $2.75 to $2.95 on a non-GAAP¹ basis excluding the $5.3 million pre-tax transaction costs associated with the SiEnergy acquisition (approximately $3.9 million or $0.09 per share after-tax²) recorded in the first quarter of 2025. This guidance assumes continued customer growth, average weather conditions, and no significant changes in prevailing regulatory policies, mechanisms, or assumed outcomes, or significant local, state or federal laws, legislation or regulations.

NW Natural Holdings reaffirmed its long-term EPS growth rate target of 4% to 6% compounded annually from the expected 2025 adjusted EPS³.

We expect NW Natural Holdings capital expenditures for 2025 to be in the range of $450 – $500 million including:

• NW Natural Gas Company capital expenditures of $330 – $360 million,

• SiEnergy capital expenditures of $65 – $75 million, and

• NW Natural Water capital expenditures of $55 – $65 million.

NW Natural Holdings capital expenditures are expected to range from $2.5 billion to $2.7 billion from 2025 to 2030. The timing and amount of the capital expenditures and projects for 2025 or additional investments in our infrastructure during or after 2025 could change based on customer growth, significant changes in prevailing regulatory policies or outcomes, or significant local, state or federal laws, legislation or regulations, or cost estimates. Required funds for the investments are expected to be internally generated or financed with long-term debt or equity, as appropriate.

1 See “Non-GAAP Financial Measures” and “Reconciliation to GAAP” for a definition and further information on adjusted EPS.

2 Effect on EPS assumes average diluted shares of 41.1 million and an income tax rate of 26.5%.

3 Adjusted EPS growth forecasted for period 2025 – 2030 compounded annually; EPS growth rate uses adjusted 2025 EPS as base year. NW Natural Holdings does not provide a reconciliation of adjusted EPS growth rate target to the most directly comparable GAAP measures due to the inherent difficulty in forecasting and quantifying certain significant items. These items are uncertain, depend on various factors and could have a material impact on GAAP reported results for the relevant period.

DIVIDEND DECLARED

In January 2025, the board of directors of NW Natural Holdings declared a quarterly dividend of $0.49 per share on the Company’s common stock. The dividend was paid on Feb. 14, 2025 to shareholders of record on Jan. 31, 2025. The Company’s current indicated annual dividend rate is $1.96 per share. Future dividends are subject to board of director discretion and approval.

ANNUAL RESULTS

We primarily operate through our natural gas distribution segment, which is operated through a regulated utility and principally engaged in the delivery of natural gas to customers in Oregon and southwest Washington. The segment also includes the portion of the Mist underground storage facility used to serve gas utility customers, the North Mist gas storage expansion, and RNG development and procurement for the utility.

Other business activities are reported through “Other” results and primarily include Interstate Storage Services and third-party asset management services for the Mist facility in Oregon; NW Natural Water, which is a water and wastewater utility business; and NW Natural Renewables, which is a renewable fuels business.

NW Natural Holdings’ annual results by business segment are summarized in the table below:

	2024							2023							Change
In thousands, except per share data	Amount			Per Share				Amount			Per Share				Amount			Per Share
Net income:
Natural gas distribution segment	$	77,126		$	1.98			$	94,042		$	2.59			$	(16,916	)	$	(0.61	)
Regulatory disallowance, net		10,070			0.26				—			—				10,070			0.26
Adjusted natural gas distribution segment1	$	87,196		$	2.24			$	94,042		$	2.59			$	(6,846	)	$	(0.35	)
Other	$	1,745		$	0.05			$	(174	)	$	—			$	1,919		$	0.05
SiEnergy transaction expenses, net		1,685			0.04				—			—				1,685			0.04
Adjusted other1	$	3,430		$	0.09			$	(174	)	$	—			$	3,604		$	0.09
Consolidated	$	78,871		$	2.03			$	93,868		$	2.59			$	(14,997	)	$	(0.56	)
Adjustments		11,755			0.30				—			—				11,755			0.30
Adjusted consolidated1	$	90,626		$	2.33			$	93,868		$	2.59			$	(3,242	)	$	(0.26	)
Diluted Shares					38,869							36,265							2,604
1 See “Non-GAAP Financial Measures” and “Reconciliation to GAAP” for additional information. Adjusted 2024 natural gas distribution segment, other, and consolidated net income are non-GAAP financial measures and exclude the effects of a non-cash regulatory disallowance of NW Natural’s line extension costs $10.1 million after-tax and SiEnergy transaction costs $1.7 million after-tax. Non-GAAP financial measures should not be considered a substitute for, or superior to, measures calculated in accordance with U.S. GAAP. Non-GAAP financial measures are used to analyze our financial performance because we believe they provide useful information to our investors and creditors in evaluating our financial condition and results of operations.

Natural Gas Distribution Segment

Natural gas distribution segment net income decreased $16.9 million (or $0.61 per share). Results include a $10.1 million non-cash detriment due to a regulatory disallowance of NW Natural’s line extension allowance. Excluding the effects of the disallowance, net income decreased $6.8 million (or $0.35 per share), reflecting higher pension costs and lower interest income, partially offset by new rates in Oregon effective beginning Nov. 1, 2024.

Margin increased $26.3 million primarily due to new rates in Oregon effective Nov. 1, 2024, which contributed $25.8 million, the amortization of deferrals and customer growth, which contributed $5.9 million. Partially offsetting these items was a $4.3 million reduction in margin due to warmer comparative weather and the effect of customers not covered by the weather normalization mechanism. Weather was 17% warmer than average for 2024, compared to 8% warmer than average for 2023. In addition, there was a $1.8 million decline in gains on the Oregon gas cost incentive sharing mechanism due to lower commodity price volatility and higher than estimated gas costs during the cold weather event in January 2024.

Operations and maintenance expense decreased $2.1 million, excluding the effects of the regulatory disallowance, as a result of lower contractor costs and bad debt expense, partially offset by higher information technology costs.

Depreciation and general taxes increased by $12.1 million primarily due to additional capital investments in the distribution system.

Other income, net decreased $18.2 million primarily from higher pension expense, lower interest income due to a lower level of invested cash, lower regulatory interest income, and lower equity Allowance for Funds Used During Construction (AFUDC).

Interest expense increased $2.8 million primarily due to higher short-term debt balances, partially offset by the debt portion of AFUDC.

Income tax expense decreased $1.5 million primarily due to the decrease in pre-tax results.

Other

Net income from Other increased $1.9 million (or $0.05 per share). Results included $1.7 million of transaction expenses related to the SiEnergy acquisition. Excluding the effects of the transaction, net income increased $3.6 million (or $0.09 per share) primarily reflecting a $4.4 million increase in water and wastewater utility net income, partially offset by higher interest and other expenses at Holdings.

FOURTH QUARTER RESULTS

NW Natural Holdings’ fourth quarter results by business segment are summarized in the table below:

	Three Months Ended December 31,
	2024							2023							Change
In thousands, except per share data	Amount			Per Share				Amount			Per Share				Amount			Per Share
Net income:
Natural gas distribution segment	$	44,802		$	1.11			$	46,522		$	1.26			$	(1,720	)	$	(0.15	)
Regulatory disallowance, net		10,070			0.25				—			—				10,070			0.25
Adjusted natural gas distribution segment1	$	54,872		$	1.36			$	46,522		$	1.26			$	8,350		$	0.10
Other	$	200		$	0.01			$	(1,882	)	$	(0.05	)		$	2,082		$	0.06
SiEnergy transaction expenses, net		1,685			0.04				—			—				1,685			0.04
Adjusted other1	$	1,885		$	0.05			$	(1,882	)	$	(0.05	)		$	3,767		$	0.10
Consolidated	$	45,002		$	1.12			$	44,640		$	1.21			$	362		$	(0.09	)
Adjustments		11,755			0.29				—			—				11,755			0.29
Adjusted consolidated1	$	56,757		$	1.41			$	44,640		$	1.21			$	12,117		$	0.20
Diluted Shares					40,220							37,045							3,175
1 See “Non-GAAP Financial Measures” and “Reconciliation to GAAP” for additional information. Adjusted 2024 natural gas distribution segment, other, and consolidated net income are non-GAAP financial measures and exclude the effects of a non-cash regulatory disallowance of NW Natural’s line extension costs $10.1 million after-tax and SiEnergy transaction costs $1.7 million after-tax. Non-GAAP financial measures should not be considered a substitute for, or superior to, measures calculated in accordance with U.S. GAAP. Non-GAAP financial measures are used to analyze our financial performance because we believe they provide useful information to our investors and creditors in evaluating our financial condition and results of operations.

Natural Gas Distribution Segment

Natural gas distribution segment net income decreased $1.7 million (or $0.15 per share). Results include a $10.1 million non-cash detriment due to a regulatory disallowance of NW Natural’s line extension allowance. Excluding the effects of the disallowance, net income increased $8.4 million (or $0.10 per share) primarily reflecting new rates in Oregon that went into effect on Nov. 1, 2024, partially offset by higher pension costs, and lower interest income.

Margin increased $25.4 million primarily due to new rates in Oregon effective Nov. 1, 2024, which contributed $25.8 million.

Operations and maintenance expense increased $0.4 million excluding the effects of the non-cash regulatory disallowance of line extension costs.

Depreciation and general taxes collectively increased by $3.9 million primarily due to continued investment in our system.

Other income, net reflected a $5.6 million decrease primarily from higher pension expense, lower regulatory interest income, and lower equity AFUDC.

Interest expense increased $1.4 million primarily due to higher short-term debt balances.

Income tax expense increased $2.0 million primarily due to several items including higher Oregon corporate activity taxes and a lower level of regulatory tax benefits.

Other

Net income from Other increased $2.1 million (or $0.06 per share). Results included a $1.7 million detriment due to transaction expenses related to the SiEnergy acquisition. Excluding the effects of the transaction, net income increased $3.8 million (or $0.10 per share), reflecting higher gas storage net income of $1.0 million and a $3.2 million higher net income contribution from water and wastewater utilities related to new rates at several larger utilities and the acquisition of Puttman/ICH.

BALANCE SHEET AND CASH FLOWS

For 2024, the Company generated $200.3 million in operating cash flow and invested $394.4 million in utility capital expenditures to support growth and safety. In addition, the Company invested $29.8 million in water and wastewater acquisitions. Net cash provided by financing activities was $227.1 million for 2024 due to issuing long-term and short-term debt and equity. As of Dec. 31, 2024, NW Natural Holdings held cash of $38.5 million.

CONFERENCE CALL AND WEBCAST

As previously announced, NW Natural Holdings will host a conference call and webcast today to discuss its fourth quarter and annual 2024 financial and operating results.

Date and Time:	Friday, February 28
	8 a.m. PT (11 a.m. ET)
Phone Number:	1-833-470-1428
	Passcode 633579

The call will also be webcast in a listen-only format for the media and general public and can be accessed at ir.nwnaturalholdings.com. A replay of the conference call will be available on our website and by dialing 1-866-813-9403 and the replay access code of 907583.

ABOUT NW NATURAL HOLDINGS

Northwest Natural Holding Company (NYSE: NWN) (NW Natural Holdings) is headquartered in Portland, Oregon and has been doing business for over 165 years. It owns Northwest Natural Gas Company (NW Natural), SiEnergy Operating (SiEnergy), NW Natural Water Company (NW Natural Water), NW Natural Renewables Holdings (NW Natural Renewables), and other business interests.

NW Natural Holdings provides critical energy and delivers essential water and wastewater services to nearly one million customers across seven states. We have a longstanding commitment to safety, environmental stewardship, and the energy transition, and taking care of our employees and communities. NW Natural Holdings was recognized by Ethisphere® for three years running as one of the World’s Most Ethical Companies®. NW Natural consistently leads the industry with high J.D. Power & Associates customer satisfaction scores. Learn more in our latest Community and Sustainability Report at ir.nwnaturalholdings.com/sustainability.

NW Natural is a local distribution company that currently provides natural gas service to approximately 2 million people in more than 140 communities through approximately 806,000 meters in Oregon and Southwest Washington with one of the most modern pipeline systems in the nation. NW Natural owns and operates 21.6 Bcf of underground gas storage capacity in Oregon.

SiEnergy is one of the fastest growing natural gas distribution utilities in the nation, serving approximately 70,000 customers in the greater metropolitan areas of Houston, Dallas, and Austin, Texas.

NW Natural Water provides water distribution and wastewater services to communities throughout the Pacific Northwest, Texas, Arizona, and California. Today NW Natural Water serves an estimated 190,000 people through approximately 76,000 meters and provides operation and maintenance services to an additional 25,000 connections. Learn more about our water business at nwnaturalwater.com.

NW Natural Renewables is committed to leading in the energy transition by providing renewable fuels. Learn more at nwnaturalrenewables.com.

Additional information is available at nwnaturalholdings.com.

“World’s Most Ethical Companies” and “Ethisphere” names and marks are registered trademarks of Ethisphere LLC

FORWARD-LOOKING STATEMENTS

This press release, and other presentations made by NW Holdings from time to time, may contain forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as “anticipates,” “assumes,” “continues,” “could,” “intends,” “plans,” “seeks,” “believes,” “estimates,” “expects,” “will” and similar references to future periods. Examples of forward-looking statements include, but are not limited to, statements regarding the following: plans, objectives, assumptions, estimates, expectations, forecasts, outlooks, timing, goals, strategies, commitments, future events, financial positions, financial performance, investments, valuations, timing and amount of capital expenditures, targeted capital structure, risks, risk profile, stability, acquisitions and timing, approval, completion and integration thereof, the likelihood and success associated with any transaction, strategic fit, utility system, technology and infrastructure investments, system modernization, reliability and resiliency, global, national and local economies, economic and GDP growth, customer and business growth, continued expansion of service territories, rate base growth, customer backlog, growth opportunities, customer satisfaction ratings, weather, performance and service during weather events, customer rates or rate recovery and the timing and magnitude of potential rate changes and the potential outcome of rate cases, environmental remediation cost recoveries, environmental initiatives, decarbonization and the role of natural gas and the gas delivery system, including decarbonization goals and timelines, energy efficiency measures, use of renewable sources, renewable natural gas purchases, projects, investments and other renewable initiatives, and timing, magnitude and completion thereof, unregulated renewable natural gas strategy and initiatives, hydrogen projects or investments and timing, magnitude, approvals and completion thereof, procurement of renewable natural gas or hydrogen for customers, technology and policy innovations, strategic goals and visions, water, wastewater and water services acquisitions, personnel additions, partnerships, and investment strategy and financial effects of water, wastewater and water services acquisitions, expected growth and safety benefits of facility upgrade investments, operating plans of third parties, financial targets, financial results, including estimated income, availability and sources of liquidity, capital markets, financing transactions, expenses, positions, revenues, returns, cost of capital, timing, and earnings, earnings guidance and estimated future growth rates, credit ratings, debt and equity issuances and timing, future dividends, commodity costs and sourcing, asset management activities, regulatory environment, performance, timing, outcome, or effects of regulatory proceedings or mechanisms or approvals, rate case execution, regulatory prudence reviews, anticipated regulatory actions or filings, accounting treatment of future events, economic and political conditions, effects of legislation or changes in laws or regulations, impact of the new U.S. presidential administration and Congress, effects, extent, severity and duration of epidemics and pandemics, and any resulting economic disruption therefrom, inflation, geopolitical uncertainty and other statements that are other than statements of historical facts.

Forward-looking statements are based on current expectations and assumptions regarding its business, the economy, geopolitical factors, and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Actual results may differ materially from those contemplated by the forward-looking statements. You are therefore cautioned against relying on any of these forward-looking statements. They are neither statements of historical fact nor guarantees or assurances of future operational, economic or financial performance. Important factors that could cause actual results to differ materially from those in the forward-looking statements are discussed by reference to the factors described in Part I, Item 1A “Risk Factors”, and Part II, Item 7 and Item 7A “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Quantitative and Qualitative Disclosure about Market Risk” in the most recent Annual Report on Form 10-K and in Part I, Items 2 and 3 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Quantitative and Qualitative Disclosures About Market Risk”, and Part II, Item 1A, “Risk Factors”, in the quarterly reports filed thereafter, which, among others, outline legal, regulatory and legislative risks, public health risks, financial, macroeconomic and geopolitical risks, growth and strategic risks, operational risks, business continuity and technology risks, environmental risks and risks related to our water and renewables businesses.

All forward-looking statements made in this report and all subsequent forward-looking statements, whether written or oral and whether made by or on behalf of NW Holdings or NW Natural, are expressly qualified by these cautionary statements. Any forward-looking statement speaks only as of the date on which such statement is made, and NW Holdings and NW Natural undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law. New factors emerge from time to time and it is not possible to predict all such factors, nor can it assess the impact of each such factor or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statements.

NON-GAAP FINANCIAL MEASURES

Management uses “adjusted net income” and “adjusted earnings per share,” both of which are non-GAAP financial measures, when evaluating NW Natural Holdings’ overall performance. Management believes that these non-GAAP measures provide meaningful information to investors about NW Natural Holdings’ performance because they eliminate the impacts of significant discrete items that can affect the comparison of period-over-period results. In addition to presenting the results of operations and earnings amounts in total, certain financial measures are expressed in cents per share, which are non-GAAP financial measures. All references to EPS are on the basis of diluted shares.

Such non-GAAP financial measures are used to analyze our financial performance because we believe they provide useful information to our investors and creditors in evaluating our financial condition and results of operations. Our non-GAAP financial measures should not be considered a substitute for, or superior to, measures calculated in accordance with U.S. GAAP. Moreover, these non-GAAP financial measures have limitations in that they do not reflect all the items associated with the operations of the business as determined in accordance with GAAP. Other companies may calculate similarly titled non-GAAP financial measures differently than how such measures are calculated in this report, limiting the usefulness of those measures for comparative purposes. A reconciliation of each non-GAAP financial measure to the most directly comparable GAAP financial measure is provided in the tables below.

NORTHWEST NATURAL HOLDINGS
Consolidated Income Statement and Financial Highlights (Unaudited)
Fourth Quarter and Annual Period
		Three Months Ended									Twelve Months Ended
In thousands, except per share amounts, customer, and degree day data		December 31,									December 31,
			2024				2023		Change			2024				2023		Change
Operating revenues		$	370,876			$	355,714		4%		$	1,152,994			$	1,197,475		(4)%
Operating expenses:
	Cost of gas		124,793				142,475		(12)			412,382				499,837		(17)
	Operations and maintenance		92,154				73,606		25			294,658				273,766		8
	Environmental remediation		4,828				4,352		11			14,054				12,899		9
	General taxes		10,465				10,563		(1)			48,672				46,248		5
	Revenue taxes		15,613				14,921		5			48,343				48,671		(1)
	Depreciation		36,486				32,762		11			137,898				125,581		10
	Other operating expenses		1,596				1,868		(15)			5,845				5,532		6
	Total operating expenses		285,935				280,547		2			961,852				1,012,534		(5)
Income from operations			84,941				75,167		13			191,142				184,941		3
Other income (expense), net			(910	)			4,627		(120)			(1,108	)			17,855		(106)
Interest expense, net			21,190				19,890		7			80,092				76,566		5
Income before income taxes			62,841				59,904		5			109,942				126,230		(13)
Income tax expense			17,839				15,264		17			31,071				32,362		(4)
Net income		$	45,002			$	44,640		1		$	78,871			$	93,868		(16)
Common shares outstanding:
Average diluted for period			40,220				37,045					38,869				36,265
End of period			40,222				37,631					40,222				37,631
Per share information:
Diluted earnings per share		$	1.12			$	1.21				$	2.03			$	2.59
Dividends paid per share			0.4900				0.4875					1.9525				1.9425
Book value per share, end of period			34.44				34.12					34.44				34.12
Market closing price, end of period			39.56				38.94					39.56				38.94
Capital structure, end of period:
Common stock equity			42.4	%			43.5	%				42.4	%			43.5	%
Long-term debt			51.4				48.3					51.4				48.3
Short-term debt (including current maturities of long-term debt)			6.2				8.2					6.2				8.2
	Total		100.0	%			100.0	%				100.0	%			100.0	%
Natural Gas Distribution segment operating statistics:
Meters – end of period			805,529				799,250		0.8%			805,529				799,250		0.8%
Volumes – therms:
	Residential and commercial sales		233,892				226,558					708,873				735,755
	Industrial sales and transportation		121,126				122,007					461,966				470,919
Total volumes sold and delivered			355,018				348,565					1,170,839				1,206,674
Operating revenues:
	Residential and commercial sales	$	321,350			$	310,056				$	968,676			$	1,015,072
	Industrial sales and transportation		21,831				24,676					83,060				97,886
	Other distribution revenues		900				825					4,435				4,540
	Other regulated services		4,877				4,735					19,517				18,902
Total operating revenues			348,958				340,292					1,075,688				1,136,400
	Less: Cost of gas		124,778				142,531					412,320				500,061
	Environmental remediation expense		4,827				4,352					14,053				12,899
	Revenue taxes		15,456				14,873					48,037				48,432
Margin, net		$	203,897			$	178,536				$	601,278			$	575,008
Degree days:
	Average (25-year average)		1,060				1,057					2,702				2,686
	Actual		831				822		1%			2,255				2,480		(9)%
Percent warmer than average weather			(22	)%			(22	)%				(17	)%			(8	)%

NORTHWEST NATURAL HOLDINGS
Consolidated Balance Sheets (Unaudited)	As of December 31,
In thousands		2024				2023
Assets:
Current assets:
Cash and cash equivalents	$	38,490			$	32,920
Accounts receivable		124,480				121,341
Accrued unbilled revenue		94,400				83,138
Allowance for uncollectible accounts		(3,474	)			(3,455	)
Regulatory assets		130,116				178,270
Derivative instruments		6,628				11,380
Inventories		106,954				112,571
Other current assets		60,180				65,275
Total current assets		557,774				601,440
Non-current assets:
Property, plant, and equipment		4,918,919				4,556,609
Less: Accumulated depreciation		1,246,592				1,198,555
Total property, plant, and equipment, net		3,672,327				3,358,054
Regulatory assets		382,499				333,443
Derivative instruments		535				431
Other investments		82,236				102,951
Operating lease right of use asset, net		68,626				71,308
Assets under sales-type leases		125,653				129,882
Goodwill		183,804				163,344
Other non-current assets		160,862				106,239
Total non-current assets		4,676,542				4,265,652
Total assets	$	5,234,316			$	4,867,092
Liabilities and equity:
Current liabilities:
Short-term debt	$	170,110			$	89,780
Current maturities of long-term debt		30,787				150,865
Accounts payable		133,270				145,361
Taxes accrued		16,176				15,454
Interest accrued		18,220				15,836
Regulatory liabilities		116,180				84,962
Derivative instruments		75,272				98,661
Operating lease liabilities		1,840				2,333
Other current liabilities		87,162				93,626
Total current liabilities		649,017				696,878
Long-term debt		1,679,355				1,425,435
Deferred credits and other non-current liabilities:
Deferred tax liabilities		397,149				382,673
Regulatory liabilities		730,117				695,896
Pension and other postretirement benefit liabilities		130,397				158,116
Derivative instruments		13,307				28,055
Operating lease liabilities		75,914				77,167
Other non-current liabilities		173,689				119,034
Total deferred credits and other non-current liabilities		1,520,573				1,460,941
Equity:
Common stock		989,346				890,976
Retained earnings		402,925				399,911
Accumulated other comprehensive loss		(6,900	)			(7,049	)
Total equity		1,385,371				1,283,838
Total liabilities and equity	$	5,234,316			$	4,867,092

NORTHWEST NATURAL HOLDINGS
Consolidated Statements of Cash Flows (Unaudited)	Year Ended December 31,
In thousands		2024				2023
Operating activities:
Net income	$	78,871			$	93,868
Adjustments to reconcile net income to cash provided by operations:
Depreciation		137,898				125,581
Amortization		20,162				17,641
Deferred income taxes		11,366				8,966
Qualified defined benefit pension plan expense (benefit)		4,062				(2,430	)
Contributions to qualified defined benefit pension plans		(20,460	)			—
Deferred environmental expenditures, net		(23,307	)			(26,052	)
Environmental remediation expense		14,054				12,899
Asset optimization revenue sharing bill credits		(28,874	)			(10,471	)
Regulatory disallowance of line extension allowances		13,700				—
Other		10,799				8,548
Changes in assets and liabilities:
Receivables, net		(15,302	)			50,977
Inventories		(2,735	)			(24,105	)
Income and other taxes		809				(1,246	)
Accounts payable		(14,144	)			(39,958	)
Deferred gas costs		38,129				52,371
Asset optimization revenue sharing		14,539				22,637
Decoupling mechanism		5,173				(11,415	)
Cloud-based software		(22,393	)			(16,307	)
Regulatory accounts		12,292				4,617
RNC facility prepayment		(51,427	)			—
Other, net		17,070				13,828
Cash provided by operating activities		200,282				279,949
Investing activities:
Capital expenditures		(394,400	)			(327,347	)
Acquisitions, net of cash acquired		(29,816	)			(7,533	)
Purchase of equity method investment		(1,000	)			(1,000	)
Other		(3,770	)			383
Cash used in investing activities		(428,986	)			(335,497	)
Financing activities:
Proceeds from common stock issued, net		90,374				66,495
Long-term debt issued		285,000				330,000
Long-term debt retired		(150,000	)			(90,000	)
Changes in other short-term debt, net		80,330				(168,540	)
Cash dividend payments on common stock		(72,852	)			(67,340	)
Payment of financing fees		(3,290	)			(2,200	)
Shares withheld for tax purposes		(1,319	)			(1,313	)
Other		(1,181	)			(2,894	)
Cash provided by financing activities		227,062				64,208
(Decrease) increase in cash, cash equivalents and restricted cash		(1,642	)			8,660
Cash, cash equivalents and restricted cash, beginning of period		49,624				40,964
Cash, cash equivalents and restricted cash, end of period	$	47,982			$	49,624
Supplemental disclosure of cash flow information:
Interest paid, net of capitalization	$	71,233			$	80,197
Income taxes paid, net of refunds		19,394				24,263
Non-cash activities:
Shares issued in connection with business combinations	$	1,429			$	12,884
Debt assumed in connection with business combinations		—				3,131
Reconciliation of cash, cash equivalents and restricted cash:
Cash and cash equivalents	$	38,490			$	32,920
Restricted cash included in other current assets		9,492				16,704
Cash, cash equivalents and restricted cash	$	47,982			$	49,624

NORTHWEST NATURAL HOLDINGS
Reconciliation to GAAP (Unaudited)
2025 EPS Guidance Reconciliation Table
GAAP EPS guidance	$2.66 to $2.86
SiEnergy transaction costs1	0.09
Adjusted EPS guidance2	$2.75 to $2.95

1		Effect on EPS assumes average diluted shares of 41.1 million and an income tax rate of 26.5%.
2		See “Non-GAAP Financial Measures” for a definition and further information on Adjusted EPS.

NORTHWEST NATURAL HOLDINGS
Reconciliation to GAAP (Unaudited)
		Twelve Months Ended December 31,
		2024							2023
In thousands, except per share data		Amount			Per Share				Amount			Per Share
CONSOLIDATED
GAAP net income		$	78,871		$	2.03			$	93,868		$	2.59
Regulatory line extension disallowance			13,700			0.35
SiEnergy transaction costs			2,292			0.06
Income tax effect1			(4,237	)		(0.11	)
Adjusted net income		$	90,626		$	2.33			$	93,868		$	2.59
Diluted shares						38,869							36,265
NATURAL GAS DISTRIBUTION SEGMENT
GAAP net income		$	77,126		$	1.98			$	94,042		$	2.59
Regulatory line extension disallowance			13,700			0.35
Income tax effect1			(3,630	)		(0.09	)
Adjusted net income		$	87,196		$	2.24			$	94,042		$	2.59
OTHER
GAAP net income (loss)		$	1,745		$	0.05			$	(174	)	$	—
SiEnergy transaction costs			2,292			0.06
Income tax effect1			(607	)		(0.02	)
Adjusted net income (loss)		$	3,430		$	0.09			$	(174	)	$	—

1		Regulatory disallowance related to line extension allowance and SiEnergy transaction expenses were recognized in the fourth quarter of 2024. Tax effect of adjustment was calculated using a combined federal and statutory rate of 26.5%.

NORTHWEST NATURAL HOLDINGS
Reconciliation to GAAP (Unaudited)
		Three Months Ended December 31,
		2024							2023
In thousands, except per share data		Amount			Per Share				Amount			Per Share
CONSOLIDATED
GAAP net income		$	45,002		$	1.12			$	44,640		$	1.21
Regulatory line extension disallowance			13,700			0.34
SiEnergy transaction costs			2,292			0.06
Income tax effect1			(4,237	)		(0.11	)
Adjusted net income		$	56,757		$	1.41			$	44,640		$	1.21
Diluted shares						40,220							37,045
NATURAL GAS DISTRIBUTION SEGMENT
GAAP net income		$	44,802		$	1.11			$	46,522		$	1.26
Regulatory line extension disallowance			13,700			0.34
Income tax effect1			(3,630	)		(0.09	)
Adjusted net income		$	54,872		$	1.36			$	46,522		$	1.26
OTHER
GAAP net income (loss)		$	200		$	0.01			$	(1,882	)	$	(0.05	)
SiEnergy transaction costs			2,292			0.06
Income tax effect1			(607	)		(0.02	)
Adjusted net income (loss)		$	1,885		$	0.05			$	(1,882	)	$	(0.05	)

1

Regulatory disallowance related to line extension allowance and SiEnergy transaction expenses were recognized in the fourth quarter of 2024. Tax effect of adjustment was calculated using a combined federal and statutory rate of 26.5%.

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20250228467819/en/

Investor Contact:

Nikki Sparley

Phone: 503-721-2530

Email: [email protected]

Media Contact:

David Roy

Phone: 503-610-7157

Email: [email protected]

KEYWORDS: United States North America Oregon

INDUSTRY KEYWORDS: Oil/Gas Natural Resources Energy Other Natural Resources Utilities

MEDIA:

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Docebo Reports Fourth Quarter and Fiscal Year 2024 Results

TORONTO–(BUSINESS WIRE)–Docebo Inc. (NASDAQ: DCBO; TSX:DCBO) (“Docebo” or the “Company”), a leading learning platform provider with a foundation in artificial intelligence (AI) and innovation, announced financial results for the three months and fiscal year ended December 31, 2024. All amounts are expressed in US dollars unless otherwise stated.

“We are pleased to announce Q4 and annual results, with revenue beating our expectations and profitability coming in at the high end of our guidance even as we invest in our growth initiatives. Our AI-driven platform continues to differentiate Docebo with the capabilities to support complex, multi-use case requirements,” stated Alessio Artuffo, President and CEO. “Our competitive position continued to gain strength with the successful launch of three new products: AI Authoring, Advanced Analytics, and Communities. The positive response from customers and channel partners is strengthening our enterprise pipeline, setting us up for solid growth in the year ahead.”

Fourth Quarter 2024 Financial Highlights

• Subscription revenue of $54.0 million, an increase of 16% from the comparative period in the prior year, represented 95% of total revenue.

• Total revenue of $57.0 million, an increase of 16% from the comparative period in the prior year.

• Gross profit of $46.4 million, an increase of 16% from the comparative period in the prior year, represented 81.3% of revenue compared to 81.2% of revenue for the comparative period in the prior year.

• Net income of $11.9 million, or $0.39 per share, compared to net income of $3.2 million, or $0.10 per share for the comparative period in the prior year.

• Adjusted Net Income¹ of $8.7 million, or Adjusted Earnings per share of $0.29, compared to Adjusted Net Income of $8.3 million, or Adjusted Earnings per share of $0.26 for the comparative period in the prior year.

• Annual Recurring Revenue (“ARR”)¹ of $9.2 million added during the quarter, compared to $10.8 million for the comparative period in the prior year, in each case after adjusting for foreign currency exchange impacts.

• As at December 31, 2024, ARR was $219.7 million, an increase of $25.4 million from $194.3 million as at the end of the fourth quarter of 2023.

• Adjusted EBITDA¹ of $9.5 million, representing 16.7% of total revenue, compared to $6.5 million, representing 13.2% of total revenue, for the comparative period in the prior year.

• Cash flow from operating activities of $9.7 million, compared to $6.5 million for the comparative period in the prior year.

• Free Cash Flow¹ of $10.1 million, representing 17.7% of total revenue for the three months ended December 31, 2024, compared to $7.0 million, representing 14.2% of total revenue, for the comparative period in the prior year.

Fiscal Year 2024 Financial Highlights

• Subscription revenue of $204.3 million, an increase of 20% from the comparative period in the prior year, represented 94% of total revenue.

• Total revenue of $216.9 million, an increase of 20% from the comparative period in the prior year.

• Gross profit of $175.6 million, an increase of 20% from the comparative period in the prior year, represented 81.0% of revenue compared to 80.9% of revenue for the comparative period in the prior year.

• Net income of $26.7 million, or $0.88 per share, compared to net income of $2.8 million, or $0.09 per share, for the comparative period in the prior year.

• Adjusted Net Income¹ of $32.1 million, or Adjusted Earnings per share of $1.06, compared to Adjusted Net Income¹ of $21.2 million, or Adjusted Earnings per share of $0.65 for the comparative period in the prior year.

• Net Dollar Retention Rate¹ as at December 31, 2024 of 100% compared to 104% at December 31, 2023.

• Adjusted EBITDA¹ of $33.6 million, representing 15.5% of total revenue, compared to Adjusted EBITDA¹ of $16.3 million, representing 9.0% of total revenue, for the comparative period in the prior year.

• Cash flow generated from operating activities of $29.2 million, compared to $16.0 million for the comparative period in the prior year.

• Free Cash Flow¹ of $32.3 million, representing 15% of total revenue, compared to $20.1 million, representing 11% of total revenue, for the comparative period in the prior year.

• Cash and cash equivalents of $92.5 million as at December 31, 2024 compared to $72.0 million as at December 31, 2023.

Fourth Quarter 2024 Business Highlights

• Docebo is now used by 3,978 customers, an increase from 3,759 customers at the end of December 31, 2023.

• Average Contract Value¹, calculated as total Annual Recurring Revenue divided by the number of active customers, is $55,229 as at December 31, 2024 an increase from $51,689 as at December 31, 2023.

• Notable new customer wins in the quarter include the YMCA of the USA (Y-USA), the national resource office for the YMCA dedicated to strengthening community, chose Docebo to upgrade their learning & knowledge platform from a legacy, internally developed LMS. Working with one of our large systems integrator partners, an immersive analysis was undertaken in order to better understand the organization’s immediate and longer-term learning Employee Experience (EX) needs for onboarding, compliance and leadership training use cases.

• Xponential Fitness, Inc. one of the leading global franchisors of boutique health and wellness brands, operates a diversified platform of nine brands spanning across verticals including Pilates, indoor cycling, barre, stretching, dancing, boxing, strength training, metabolic health, and yoga. Docebo’s EX capabilities were chosen to replace a legacy platform because of its configurability in addressing each unique health and wellness brand with a modern, easy to use platform able to deliver the curated learning experiences crucial to the training of Xponential’s franchisees.

• A large multinational vertically integrated oil and gas company headquartered in Europe working with a large systems integrator partner selected Docebo to address a Customer Experience (CX) use case to train petrol station and automobile service franchisees across Europe with the plan to expand the program globally.

• lululemon athletica inc. is a technical athletic apparel, footwear, and accessories company for yoga, running, training, and most other activities. Having initially partnered with Docebo for EX use cases that included onboarding, compliance and a mobile application to train their retail associates in 2021, they expanded their use of the Docebo learning & knowledge platform when they added a CX use case designed to train vendors as a means to improve supply chain management processes.

• Docebo expanded its learner base at Databricks, a data and AI company for a second time in 2024. Databricks deployed Docebo’s learning platform to support several CX and EX use cases including partner and customer training, sales enablement, professional development, leadership training, onboarding and compliance.

¹ Please refer to “Non-IFRS Measures and Reconciliation of Non-IFRS Measures” section of this press release.

Financial Outlook

Docebo is providing financial guidance for the fiscal year ending December 31, 2025 as follows:

• Subscription revenue growth of 11.5% to 12.5% or 13.0% to 14.0% after adjusting for negative impact of 1.5% resulting from the strengthening of the U.S. dollar relative to foreign currencies

• Total revenue growth between 11.0% and 12.0% or 12.5% to 13.5% after adjusting for negative impact of 1.5% resulting from the strengthening of the U.S. dollar relative to foreign currencies

• Adjusted EBITDA as a percentage of total revenue between 18.0% and 19.0%

Docebo is providing financial guidance for the three months ended March 31, 2025 as follows:

• Total revenue between $57.0 million and $57.2 million which includes an approximately 1.5% negative impact resulting from the strengthening of the U.S. dollar relative to foreign currencies

• Adjusted EBITDA as a percentage of total revenue between 14.5% to 15.0%

The information in this section is forward-looking. Please see the sections entitled “Non-IFRS Measures and Reconciliation of Non-IFRS Measures” and “Key Performance Indicators” in this press release for how we define “Adjusted EBITDA” and the section entitled “Forward-Looking Information.” A reconciliation of forward-looking “Adjusted EBITDA” to the most directly comparable IFRS measure is not available without unreasonable effort, as certain items cannot be reasonably predicted because of their high variability, complexity and low visibility. Docebo believes that this type of guidance provides useful insight into the anticipated performance of its business.

Fourth Quarter and Fiscal Year 2024 Results

Selected Financial Measures

	Three months ended December 31,								Fiscal year ended December 31,
	2024		2023		Change	Change			2024		2023		Change	Change
	$		$		$	%			$		$		$	%
Subscription Revenue (in thousands of US dollars)	53,976		46,486		7,490	16.1	%		204,302		169,764		34,538	20.3	%
Professional Services (in thousands of US dollars)	3,065		2,794		271	9.7	%		12,629		11,075		1,554	14.0	%
Total Revenue (in thousands of US dollars)	57,041		49,280		7,761	15.7	%		216,931		180,839		36,092	20.0	%
Gross Profit (in thousands of US dollars)	46,391		40,025		6,366	15.9	%		175,636		146,341		29,295	20.0	%
Percentage of Total Revenue	81.3	%	81.2	%					81.0	%	80.9	%
Net Income (in thousands of US dollars)	11,910		3,222		8,688	269.6	%		26,736		2,840		23,896	841.4	%
Earnings per Share – Basic	0.39		0.10		0.29	290.0	%		0.88		0.09		0.79	877.8	%
Earnings per Share – Diluted	0.38		0.10		0.28	280.0	%		0.86		0.08		0.78	975.0	%
Cash Provided by Operating Activities (in thousands of US dollars)	9,727		6,476		3,251	50.2	%		29,249		15,964		13,285	83.2	%

Key Performance Indicators and Non-IFRS Measures

	As at December 31,
	2024		2023		Change		Change %
Annual Recurring Revenue (in millions of US dollars)	219.7		194.3		25.4		13.1	%
Average Contract Value (in thousands of US dollars)	55.2		51.7		3.5		6.8	%
Net Dollar Retention Rate	100	%	104	%	(4	)%	(4	)%
Customers	3,978		3,759		219		5.8	%

	Three months ended December 31,							Fiscal year ended December 31,
	2024	2023	Change		Change			2024	2023	Change		Change
	$	$	$		%			$	$	$		%
Adjusted EBITDA (in thousands of US dollars)	9,515	6,500	3,015		46.4	%		33,616	16,277	17,339		106.5	%
Adjusted Net Income (in thousands of US dollars)	8,658	8,303	355		4.3	%		32,116	21,159	10,957		51.8	%
Adjusted Earnings per Share – Basic	0.29	0.26	0.03		11.5	%		1.06	0.65	0.41		63.1	%
Adjusted Earnings per Share – Diluted	0.28	0.25	0.03		12.0	%		1.04	0.63	0.41		65.1	%
Working Capital (in thousands of US dollars)	19,485	21,494	(2,009	)	(9.3	)%		19,485	21,494	(2,009	)	(9.3	)%
Free Cash Flow (in thousands of US dollars)	10,109	7,004	3,105		44.3	%		32,286	20,117	12,169		60.5	%

Conference Call

Management will host a conference call on Friday, February 28, 2025 at 8:00 am ET to discuss these fourth quarter and fiscal year results. To access the conference call, please dial +1-646-960-0169 or +1-888-440-6849 or access the webcast at https://docebo.inc/events-and-presentations/default.aspx. The Company will post Prepared Management Remarks (in .pdf format) regarding its Q4-2024 results, which will be the subject of this call, on the Investor Relations section of Docebo’s website at https://investors.docebo.com.

The consolidated financial statements for the fiscal year ended December 31, 2024 and Management’s Discussion & Analysis for the same period have been filed on SEDAR+ at www.sedarplus.ca and on EDGAR at www.sec.gov. Alternatively, these documents along with a presentation in connection with the conference call can be accessed online at https://investors.docebo.com.

An archived recording of the conference call will be available until March 7, 2025 and for 90 days on our website. To listen to the recording, please visit the webcast link which can be found on Docebo’s investor relations website at https://docebo.inc/events-and-presentations/default.aspx or call +1-609-800-9909 or +1-800-770-2030 and enter passcode 8722408#.

Forward-Looking Information

This press release contains “forward-looking information” and “forward-looking statements” (collectively, “forward-looking information”) within the meaning of applicable securities laws.

In some cases, forward-looking information can be identified by the use of forward-looking terminology such as “plans”, “targets”, “expects”, “is expected”, “an opportunity exists”, “budget”, “scheduled”, “estimates”, “outlook”, “forecasts”, “projection”, “prospects”, “strategy”, “intends”, “anticipates”, “believes”, or variations of such words and phrases or statements that certain actions, events or results “may”, “could”, “would”, “might” or, “will”, “occur” or “be achieved”, and similar words or the negative of these terms and similar terminology. In addition, any statements that refer to expectations, intentions, projections or other characterizations of future events or circumstances contain forward-looking information. Statements containing forward-looking information are not historical facts but instead represent management’s expectations, estimates and projections regarding future events or circumstances.

This forward-looking information in this press release includes, but is not limited to, statements regarding the Company’s business; the guidance for the three months ended March 31, 2025 in respect of total revenue, Adjusted EBITDA as a percentage of total revenue and subscription revenue and fiscal year ending December 31, 2025 in respect of total revenue growth, and Adjusted EBITDA as a percentage of total revenue discussed under “Financial Outlook” in this press release; the impact of AI on our business; future financial position and business strategy; the learning management industry; our growth rates and growth strategies; addressable markets for our solutions; the achievement of advances in and expansion of our platform; expectations regarding our revenue and the revenue generation potential of our platform and other products; our business plans and strategies; and our competitive position in our industry. This forward-looking information is based on our opinions, estimates and assumptions in light of our experience and perception of historical trends, current conditions and expected future developments, as well as other factors that we currently believe are appropriate and reasonable in the circumstances. Despite a careful process to prepare and review the forward-looking information, there can be no assurance that the underlying opinions, estimates and assumptions will prove to be correct. Certain assumptions include: our ability to build our market share and enter new markets and industry verticals; our ability to attract and retain key personnel; our ability to maintain and expand geographic scope; our ability to execute on our expansion plans; our ability to continue investing in infrastructure to support our growth; our ability to obtain and maintain existing financing on acceptable terms; our ability to execute on profitability initiatives; currency exchange and interest rates; the impact of inflation and global macroeconomic conditions; the impact of competition; our ability to respond to the changes and trends in our industry or the global economy; and the changes in laws, rules, regulations, and global standards are material factors made in preparing forward-looking information and management’s expectations.

Forward-looking information is necessarily based on a number of opinions, estimates and assumptions that, while considered by the Company to be appropriate and reasonable as of the date of this press release, are subject to known and unknown risks, uncertainties, assumptions and other factors that may cause the actual results, level of activity, performance or achievements to be materially different from those expressed or implied by such forward-looking information, including but not limited to:

• the Company’s ability to execute its growth strategies;
• the impact of changing conditions in the global corporate e-learning market;
• increasing competition in the global corporate e-learning market in which the Company operates;
• fluctuations in currency exchange rates and volatility in financial markets;
• changes in the attitudes, financial condition and demand of our target market;
• the Company’s ability to operate its business and effectively manage its growth under evolving macroeconomic conditions, such as high inflation and recessionary environments;
• developments and changes in applicable laws and regulations;
• fluctuations in the length and complexity of the sales cycle for our platform, especially for sales to larger enterprises;
• issues in the use of AI in our platform and potential resulting reputational harm or liability;
• such other factors discussed in greater detail under the “Risk Factors” section of our Annual Information Form dated February 27, 2025 (“AIF”), which is available under our profile on SEDAR+ at www.sedarplus.ca.

Our guidance for the three months ended March 31, 2025 in respect of total revenue, Adjusted EBITDA as a percentage of total revenue and subscription revenue and fiscal year ending December 31, 2025 in respect of total revenue, and Adjusted EBITDA as a percentage of total revenue is subject to certain assumptions and associated risks as stated above under this “Forward-Looking Information,” section and in particular the following:

• currency assumptions, in particular that the US dollar will remain strong against other major currencies;
• there will be continued macro-economic headwinds that will specifically affect our small and medium sized business and lower mid-market customers;
• there will be a seven-figure negative impact on our Annual Recurring Revenue base resulting from a large enterprise customer terminating its agreement with us following its acquisition of an organization that has an in-house LMS;
• our ability to win business from new customers and expand business from existing customers;
• the timing of new customer wins and expansion decisions by our existing customers;
• maintaining our customer retention levels, and specifically, that customers will renew contractual commitments on a periodic basis as those commitments come up for renewal, at rates not materially inconsistent with our historical experience; and
• with respect to Adjusted EBITDA as a percentage of revenue, our ability to contain expense levels while expanding our business.

If any of these risks or uncertainties materialize, or if the opinions, estimates or assumptions underlying the forward-looking information prove incorrect, actual results or future events might vary materially from those anticipated in the forward-looking information. The opinions, estimates or assumptions referred to above and described in greater detail in the “Summary of Factors Affecting our Performance” section of our MD&A for the three months and fiscal year ended December 31, 2024 and in the “Risk Factors” section of our AIF, should be considered carefully by prospective investors.

Although we have attempted to identify important risk factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other risk factors not presently known to us or that we presently believe are not material that could also cause actual results or future events to differ materially from those expressed in such forward-looking information. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. No forward-looking statement is a guarantee of future results. Accordingly, you should not place undue reliance on forward-looking information, which speaks only as of the date made. The forward-looking information contained in this press release represents our expectations as of the date specified herein, and are subject to change after such date. However, we disclaim any intention or obligation or undertaking to update or revise any forward-looking information whether as a result of new information, future events or otherwise, except as required under applicable securities laws.

All of the forward-looking information contained in this press release is expressly qualified by the foregoing cautionary statements.

Additional information relating to Docebo, including our AIF, can be found on SEDAR+ at www.sedarplus.ca.

About Docebo

Docebo is redefining the way enterprises leverage technology to create and manage content, deliver training, and measure the business impact of their learning programs. With Docebo’s end-to-end learning platform, organizations worldwide are equipped to deliver scaled, personalized learning across all their audiences and use cases, driving growth and powering their business.

Results of Operations

The following table outlines our consolidated statements of income and comprehensive income for the following periods:

	Three months ended December 31,			Fiscal year ended December 31,
(In thousands of US dollars, except per share data)	2024	2023		2024	2023
	$	$		$	$
Revenue	57,041	49,280		216,931	180,839
Cost of revenue	10,650	9,255		41,295	34,498
Gross profit	46,391	40,025		175,636	146,341
Operating expenses
General and administrative	7,874	8,570		32,589	33,788
Sales and marketing	18,431	16,163		69,518	67,204
Research and development	11,577	9,023		43,908	35,479
Share-based compensation	1,660	1,611		7,330	6,049
Foreign exchange (gain) loss	(1,841)	3,025		(2,385)	4,390
Depreciation and amortization	865	554		3,384	3,141
	38,566	38,946		154,344	150,051
Operating income (loss)	7,825	1,079		21,292	(3,710)
Finance income, net	(565)	(2,231)		(2,404)	(8,737)
Other (income) loss	(1)	—		(17)	181
Income before income taxes	8,391	3,310		23,713	4,846
Income tax (recovery) expense	(3,519)	88		(3,023)	2,006
Net income	11,910	3,222		26,736	2,840
Other comprehensive loss (income)
Item that may be reclassified subsequently to income:
Exchange loss (gain) on translation of foreign operations	2,804	(3,363)		3,387	(3,955)
Item not subsequently reclassified to income:
Actuarial (gain) loss	(58)	330		(58)	330
	2,746	(3,033)		3,329	(3,625)
Comprehensive income	9,164	6,255		23,407	6,465
Earnings per share – basic	0.39	0.10		0.88	0.09
Earnings per share – diluted	0.38	0.10		0.86	0.08
Weighted average number of common shares outstanding – basic	30,217,283	31,900,115		30,273,036	32,525,229
Weighted average number of common shares outstanding – diluted	30,944,952	32,858,853		30,989,537	33,678,624

Key Statement of Financial Position Information

(In thousands of US dollars, except percentages)	December 31, 2024	December 31, 2023		Change	Change
	$	$		$	%
Cash and cash equivalents	92,540	71,950		20,590	28.6%
Total assets	190,713	158,375		32,338	20.4%
Total liabilities	132,952	107,654		25,298	23.5%
Total long-term liabilities	4,350	7,002		(2,652)	(37.9)%

Non-IFRS Measures and Reconciliation of Non-IFRS Measures

This press release makes reference to certain non-IFRS measures including key performance indicators used by management and typically used by our competitors in the software-as-a-service (“SaaS”) industry. These measures are not recognized measures under IFRS and do not have a standardized meaning prescribed by IFRS and are therefore not necessarily comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement those IFRS measures by providing further understanding of our results of operations from management’s perspective. Accordingly, these measures should not be considered in isolation nor as a substitute for analysis of our financial information reported under IFRS. These non-IFRS measures are used to provide investors with alternative measures of our operating performance and liquidity and thus highlight trends in our business that may not otherwise be apparent when relying solely on IFRS measures. We also believe that securities analysts, investors and other interested parties frequently use non-IFRS measures, including SaaS industry metrics, in the evaluation of companies in the SaaS industry. Management also uses non-IFRS measures to facilitate operating performance comparisons from period to period, the preparation of annual operating budgets and forecasts and to determine components of executive compensation. The non-IFRS measures referred to in this press release include “Annual Recurring Revenue”, “Average Contract Value”, “Adjusted EBITDA”, “Adjusted Net Income”, “Adjusted Earnings per Share – Basic and Diluted”, “Working Capital” and “Free Cash Flow”.

Key Performance Indicators

We recognize subscription revenues ratably over the term of the subscription period under the provisions of our agreements with customers. The terms of our agreements, combined with high customer retention rates, provides us with a significant degree of visibility into our near-term revenues. Management uses a number of metrics, including the ones identified below, to measure the Company’s performance and customer trends, which are used to prepare financial plans and shape future strategy. Our key performance indicators may be calculated in a manner different than similar key performance indicators used by other companies.

• Annual Recurring Revenue: We define Annual Recurring Revenue as the annualized equivalent value of the subscription revenue of all existing contracts (including Original Equipment Manufacturer contracts) as at the date being measured, excluding non-recurring revenues from implementation, support and maintenance fees. Our customers generally enter into annual or multi-year contracts which are non-cancellable or cancellable with penalty. Accordingly, our calculation of Annual Recurring Revenue assumes that customers will renew the contractual commitments on a periodic basis as those commitments come up for renewal. Subscription agreements may be subject to price increases upon renewal reflecting both inflationary increases and the additional value provided by our solutions. In addition to the expected increase in subscription revenue from price increases over time, existing customers may subscribe for additional features, learners or services during the term. We believe that this measure provides a fair real-time measure of performance in a subscription-based environment. Annual Recurring Revenue provides us with visibility for consistent and predictable growth to our cash flows. Our strong total revenue growth coupled with increasing Annual Recurring Revenue indicates the continued strength in the expansion of our business and will continue to be our focus on a go-forward basis.
• Average Contract Value: Average Contract Value is calculated as total Annual Recurring Revenue divided by the number of active customers.
• Net Dollar Retention Rate: We believe that our ability to retain and expand a customer relationship is an indicator of the stability of our revenue base and long-term value of our customers. We assess our performance in this area using a metric we refer to as Net Dollar Retention Rate. We compare the aggregate subscription fees contractually committed for a full month under all customer agreements (the “Total Contractual Monthly Subscription Revenue”) of our total customer base (excluding OEM partners with revenue share agreements) as of the beginning of each month to the Total Contractual Monthly Subscription Revenue of the same group at the end of the month. The Net Dollar Retention Rate includes the effect, on a dollar-weighted value basis, of our subscriptions that expand, renew, contract, or attrit, but excludes the Total Contractual Monthly Subscription Revenue from new customers during the years.

Annual Recurring Revenue, Average Contract Value and Net Dollar Retention Rate for the fiscal years ended at December 31, 2024 and 2023, were as follows:

	2024	2023		Change	Change %
Annual Recurring Revenue (in millions of US dollars)	219.7	194.3		25.4	13.1%
Average Contract Value (in thousands of US dollars)	55.2	51.7		3.5	6.8%
Net Dollar Retention Rate	100%	104%		(4.0)%	(3.8)%

Adjusted EBITDA

Adjusted EBITDA is defined as net income excluding net finance income, depreciation and amortization, income taxes, share-based compensation and related payroll taxes, other income, foreign exchange gains and losses, acquisition related compensation, transaction related expenses and restructuring costs, if any.

The IFRS measure most directly comparable to Adjusted EBITDA presented in our financial statements is net income.

The following table reconciles Adjusted EBITDA to net income for the periods indicated:

	Three months ended December 31,					Fiscal year ended December 31,
(In thousands of US dollars)	2024		2023			2024		2023
	$		$			$		$
Net income	11,910		3,222			26,736		2,840
Finance income, net(1)	(565	)	(2,231	)		(2,404	)	(8,737	)
Depreciation and amortization(2)	865		554			3,384		3,141
Income tax (recovery) expense	(3,519	)	88			(3,023	)	2,006
Share-based compensation(3)	1,660		1,611			7,330		6,049
Other income(4)	(1	)	—			(17	)	181
Foreign exchange (gain) loss(5)	(1,841	)	3,025			(2,385	)	4,390
Acquisition related compensation(6)	1,006		231			3,995		2,477
Transaction related expenses(7)	—		—			—		1,081
Restructuring(8)	—		—			—		2,849
Adjusted EBITDA	9,515		6,500			33,616		16,277
Adjusted EBITDA as a percentage of total revenue	16.7	%	13.2	%		15.5	%	9.0	%

(1)		Finance income, net, is primarily related to interest income earned on cash and cash equivalents as the funds are invested in highly liquid short-term interest-bearing marketable securities which is offset by interest expenses incurred on lease obligations, and contingent consideration as well as bank fees and other expenses.
(2)		Depreciation and amortization expense is primarily related to depreciation expense on right-of-use assets (“ROU assets”), property and equipment and acquired intangible assets.
(3)		These expenses represent non-cash expenditures recognized in connection with the issuance of share-based compensation to our employees and directors and cash payroll taxes paid on gains earned by option holders when stock options are exercised.
(4)		Other (income) expense, net is primarily comprised of rental income from subleasing office space.
(5)		These non-cash gains and losses relate to foreign exchange translation.
(6)		These costs represent the earn-out portion of the consideration paid to the vendors of previously acquired businesses that is associated with the achievement of certain acquisition related performance and other obligations.
(7)		These expenses relate to professional, legal, consulting, accounting and other fees related to acquisition activities that would otherwise have not been incurred and are not considered an expense indicative of continuing operations.
(8)		There was a reduction in workforce during the second quarter of 2023 that resulted in severance payments to employees. Certain functions and the associated management structure were reorganized to realize synergies and ensure organizational agility.

Adjusted Net Income and Adjusted Earnings per Share – Basic and Diluted

Adjusted Net Income is defined as net income excluding amortization of intangible assets, share-based compensation and related payroll taxes, acquisition related compensation, transaction related expenses, restructuring costs, foreign exchange gains and losses, and income taxes.

Adjusted Earnings per share – basic and diluted is defined as Adjusted Net Income divided by the weighted average number of common shares (basic and diluted).

The IFRS measure most directly comparable to Adjusted Net Income presented in our financial statements is net income.

The following table reconciles net income to Adjusted Net Income for the periods indicated:

	Three months ended December 31,			Fiscal year ended December 31,
(In thousands of US dollars)	2024	2023		2024	2023
	$	$		$	$
Net income for the period	11,910	3,222		26,736	2,840
Amortization of intangible assets	172	(79)		693	613
Share-based compensation	1,660	1,611		7,330	6,049
Acquisition related compensation	1,006	231		3,995	2,477
Transaction related expenses	—	—		—	1,081
Restructuring	—	—		—	2,849
Foreign exchange (gain) loss	(1,841)	3,025		(2,385)	4,390
Deferred income tax (recovery) expense	(4,249)	293		(4,253)	860
Adjusted net income	8,658	8,303		32,116	21,159
Weighted average number of common shares – basic	30,217,283	31,900,115		30,273,036	32,525,229
Weighted average number of common shares – diluted	30,944,952	32,858,853		30,989,537	33,678,624
Adjusted earnings per share – basic	0.29	0.26		1.06	0.65
Adjusted earnings per share – diluted	0.28	0.25		1.04	0.63

Working Capital

Working Capital as at December 31, 2024 and 2023 was $19.5 million and $21.5 million, respectively. Working Capital is defined as current assets, excluding the current portion of the net investment in finance lease and contract costs, minus current liabilities, excluding borrowings, if any, and the current portion of contingent consideration and lease obligations. Working Capital is not a recognized measure under IFRS.

The following table represents the Company’s working capital position as at December 31, 2024 and 2023:

	2024		2023
	$		$
Current assets	154,241		127,153
Less: Current portion of net investment in finance lease	(43)		(83)
Less: Current portion of contract costs	(7,452)		(6,394)
Current assets, net of net investment in finance lease and contract costs	146,746		120,676
Current liabilities	128,602		100,652
Less: Current portion of lease obligations	(1,341)		(1,470)
Current liabilities, net of lease obligations	127,261		99,182
Working capital	19,485		21,494

Free Cash Flow

Free Cash Flow is defined as cash flows from operating activities less cash used for purchases of property and equipment and capitalized internal-use software costs, plus non-recurring expenditures such as the payment of acquisition-related compensation, the payment of transaction-related costs, and the payment of restructuring costs. Free Cash Flow is not a recognized measure under IFRS. The IFRS measure most directly comparable to Free Cash Flow presented in our financial statements is cash flow from operating activities.

The following table reconciles our cash flows from operating activities to Free Cash Flow for the periods indicated:

	Three months ended December 31,					Fiscal year ended December 31,
(In thousands of US dollars)	2024		2023			2024		2023
	$		$			$		$
Cash flow from operating activities	9,727		6,476			29,249		15,964
Purchases of property and equipment	(287	)	(249	)		(1,245	)	(635	)
Acquisition related compensation paid	669		669			3,976		858
Transaction related expenses paid	—		90			306		1,081
Restructuring costs paid	—		18			—		2,849
Free cash flow	10,109		7,004			32,286		20,117
Free cash flow as a percentage of total revenue	17.7	%	14.2	%		14.9	%	11.1	%

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20250228422601/en/

Mike McCarthy

Vice President – Investor Relations

(214) 830-0641

[email protected]

KEYWORDS: North America Canada

INDUSTRY KEYWORDS: Apps/Applications Technology Other Technology Software Other Education Training Data Management Primary/Secondary Education Artificial Intelligence

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