Market Newsdesk

May 12, 2023 8:05 am

CORRECTING and REPLACING SelectQuote, Inc. Reports Third Quarter of Fiscal Year 2023 Results

CORRECTING and REPLACING SelectQuote, Inc. Reports Third Quarter of Fiscal Year 2023 Results

Third Quarter of Fiscal Year 2023 – Consolidated Earnings Highlights

Revenue of $299.4 million
Net income of $9.3 million
Adjusted EBITDA* of $44.0 million

Updating Fiscal Year 2023 Guidance Ranges:

Revenue now expected in a range of $950 million to $970 million
Net loss now expected in a range of $73 million to $55 million
Adjusted EBITDA* now expected in a range of $40 million to $50 million

Third Quarter of Fiscal Year 2023 – Segment Highlights

Senior

Revenue of $185.2 million
Adjusted EBITDA* of $59.2 million
Approved Medicare Advantage policies of 165,530

Healthcare Services

Revenue of $70.7 million
Adjusted EBITDA* of $(3.4) million
Approximately 45,000 SelectRx members

Life

Revenue of $37.0 million
Adjusted EBITDA* of $5.3 million

Auto & Home

Revenue of $8.2 million
Adjusted EBITDA* of $2.6 million

OVERLAND PARK, Kan.–(BUSINESS WIRE)–
This release, dated May 10, 2023, has been updated to correct the Fiscal Year 2023 Net loss guidance range and related reconciliation table.

The updated release reads:

SELECTQUOTE, INC. REPORTS THIRD QUARTER OF FISCAL YEAR 2023 RESULTS

Third Quarter of Fiscal Year 2023 – Consolidated Earnings Highlights

Revenue of $299.4 million
Net income of $9.3 million
Adjusted EBITDA* of $44.0 million

Updating Fiscal Year 2023 Guidance Ranges:

Revenue now expected in a range of $950 million to $970 million
Net loss now expected in a range of $73 million to $55 million
Adjusted EBITDA* now expected in a range of $40 million to $50 million

Third Quarter of Fiscal Year 2023 – Segment Highlights

Senior

Revenue of $185.2 million
Adjusted EBITDA* of $59.2 million
Approved Medicare Advantage policies of 165,530

Healthcare Services

Revenue of $70.7 million
Adjusted EBITDA* of $(3.4) million
Approximately 45,000 SelectRx members

Life

Revenue of $37.0 million
Adjusted EBITDA* of $5.3 million

Auto & Home

Revenue of $8.2 million
Adjusted EBITDA* of $2.6 million

SelectQuote, Inc. (NYSE: SLQT) reported consolidated revenue for the third quarter of fiscal year 2023 of $299.4 million compared to consolidated revenue for the third quarter of fiscal year 2022 of $274.3 million. Consolidated net income for the third quarter of fiscal year 2023 was $9.3 million compared to consolidated net loss for the third quarter of fiscal year 2022 of $7.0 million. Finally, consolidated Adjusted EBITDA* for the third quarter of fiscal year 2023 was $44.0 million compared to consolidated Adjusted EBITDA* for the third quarter of fiscal year 2022 of $12.2 million.

SelectQuote Chief Executive Officer, Tim Danker, added, “Our strong results for the third quarter are an ongoing function of our strategic redesign and the continued scale of our Healthcare Services segment. None of this would be possible without the hard work of our operational teams and importantly, SelectQuote’s talented workforce. We are proud of our achievements over the past five quarters and firmly believe our results validate our strategy to drive more predictable profit and cash flow. Specifically, in Senior, our continued gains in agent productivity, costs per policy and policyholder persistency drove margin and cash flow that were inline with previous peak results, despite increased conservatism in booked lifetime values per policy. More importantly, we believe the demonstrated unit economics in Senior were achieved with substantially enhanced forecast visibility, which drove our out performance as we were able to scale volume in both AEP and OEP.”

“Our Healthcare Services business, headlined by SelectRx, also made meaningful progress toward scaled profitability, which we expect to accelerate as membership continues to onboard and season. SelectRx’s value continues to resonate with consumers, and SelectRx will increasingly benefit SelectQuote’s financial profile given its accelerated cash flow dynamics compared to Senior.”

Mr. Danker concluded, “Based on SelectQuote’s overall out performance year-to-date, we increased our guidance for fiscal year 2023 and have positioned the business very well as we plan for fiscal 2024.”

Segment Results

We currently report on four segments: 1) Senior, 2) Healthcare Services, 3) Life, and 4) Auto & Home. The performance measures of the segments include total revenue and Adjusted EBITDA.* Costs of revenue, cost of goods sold-pharmacy revenue, marketing and advertising, selling, general, and administrative, and technical development operating expenses that are directly attributable to a segment are reported within the applicable segment. Indirect costs of revenue, marketing and advertising, selling, general, and administrative, and technical development operating expenses are allocated to each segment based on varying metrics such as headcount. Adjusted EBITDA is calculated as total revenue for the applicable segment less direct and allocated costs of revenue, cost of goods sold, marketing and advertising, technical development, and selling, general, and administrative operating costs and expenses, excluding depreciation and amortization expense; gain or loss on disposal of property, equipment, and software; share-based compensation expense; and non-recurring expenses such as severance payments and transaction costs. Adjusted EBITDA Margin is calculated as Adjusted EBITDA divided by revenue.

Senior

Financial Results

The following table provides the financial results for the Senior segment for the periods presented:

	Three Months Ended March 31,								Nine Months Ended March 31,
(in thousands)	2023			2022			% Change		2023			2022			% Change
Revenue	$	185,200		$	210,973		(12	)%	$	486,541		$	459,272		6	%
Adjusted EBITDA*		59,166			39,950		48	%		138,933			(129,311	)	207	%
Adjusted EBITDA Margin*		32	%		19	%				29	%		(28	)%

Operating Metrics

Submitted Policies

Submitted policies are counted when an individual completes an application with our licensed agent and provides authorization to the agent to submit the application to the insurance carrier partner. The applicant may have additional actions to take before the application will be reviewed by the insurance carrier.

The following table shows the number of submitted policies for the periods presented:

	Three Months Ended March 31,				Nine Months Ended March 31,
	2023	2022	% Change		2023	2022	% Change
Medicare Advantage	196,372	242,721	(19	)%	538,247	678,827	(21	)%
Medicare Supplement	675	1,389	(51	)%	2,905	6,318	(54	)%
Dental, Vision and Hearing	21,175	40,178	(47	)%	59,513	122,214	(51	)%
Prescription Drug Plan	416	1,079	(61	)%	2,082	6,193	(66	)%
Other	1,864	4,907	(62	)%	5,402	11,436	(53	)%
Total	220,502	290,274	(24	)%	608,149	824,988	(26	)%

*See “Non-GAAP Financial Measures” below.

Approved Policies

Approved policies represents the number of submitted policies that were approved by our insurance carrier partners for the identified product during the indicated period. Not all approved policies will go in force.

The following table shows the number of approved policies for the periods presented:

	Three Months Ended March 31,				Nine Months Ended March 31,
	2023	2022	% Change		2023	2022	% Change
Medicare Advantage	165,530	196,377	(16	)%	467,540	546,031	(14	)%
Medicare Supplement	557	1,159	(52	)%	2,184	4,654	(53	)%
Dental, Vision and Hearing	16,968	34,486	(51	)%	47,940	101,251	(53	)%
Prescription Drug Plan	521	1,095	(52	)%	1,794	5,315	(66	)%
Other	1,029	3,836	(73	)%	3,932	9,199	(57	)%
Total	184,605	236,953	(22	)%	523,390	666,450	(21	)%

Lifetime Value of Commissions per Approved Policy

Lifetime value of commissions per approved policy represents commissions estimated to be collected over the estimated life of an approved policy based on multiple factors, including but not limited to, contracted commission rates, carrier mix and expected policy persistency with applied constraints. The lifetime value of commissions per approved policy is equal to the sum of the commission revenue due upon the initial sale of a policy, and when applicable, an estimate of future renewal commissions.

The following table shows the lifetime value of commissions per approved policy for the periods presented:

	Three Months Ended March 31,						Nine Months Ended March 31,
(dollars per policy):	2023		2022		% Change		2023		2022		% Change
Medicare Advantage	$	965	$	933	3	%	$	888	$	935	(5	)%
Medicare Supplement		871		949	(8	)%		994		1,275	(22	)%
Dental, Vision and Hearing		91		120	(24	)%		95		123	(23	)%
Prescription Drug Plan		194		229	(15	)%		211		235	(10	)%
Other		123		95	29	%		100		77	30	%

Healthcare Services

Financial Results

The following table provides the financial results for the Healthcare Services segment for the periods presented:

	Three Months Ended March 31,								Nine Months Ended March 31,
(in thousands)	2023			2022			% Change		2023			2022			% Change
Revenue	$	70,725		$	23,123		206	%	$	169,270		$	40,183		321	%
Adjusted EBITDA*		(3,366	)		(7,768	)	57	%		(24,456	)		(20,113	)	(22	)%
Adjusted EBITDA Margin*		(5	)%		(34	)%				(14	)%		(50	)%

*See “Non-GAAP Financial Measures” below.

Operating Metrics

Members

The total number of SelectRx members represents the amount of active customers to which an order has been shipped, as this is the primary key driver of revenue for Healthcare Services.

The following table shows the total number of SelectRx members as of the periods presented:

		March 31, 2023		March 31, 2022
Total SelectRx Members		44,993		16,991

Combined Senior and Healthcare Services – Consumer Per Unit Economics

The opportunity to leverage our existing database and distribution model to improve access to healthcare services for our consumers has created a need for us to review our key metrics related to our per unit economics. As we think about the revenue and expenses for Healthcare Services, we note that they are derived from the marketing acquisition costs associated with the sale of an MA or MS policy, some of which costs are allocated directly to Healthcare Services, and therefore determined that our per unit economics measure should include components from both Senior and Healthcare Services. See details of revenue and expense items included in the calculation below.

Combined Senior and Healthcare Services consumer per unit economics represents total MA and MS commissions; other product commissions; other revenues, including revenues from Healthcare Services; and operating expenses associated with Senior and Healthcare Services, each shown per number of approved MA and MS policies over a given time period. Management assesses the business on a per-unit basis to help ensure that the revenue opportunity associated with a successful policy sale is attractive relative to the marketing acquisition cost. Because not all acquired leads result in a successful policy sale, all per-policy metrics are based on approved policies, which is the measure that triggers revenue recognition.

The MA and MS commission per MA/MS policy represents the LTV for policies sold in the period. Other commission per MA/MS policy represents the LTV for other products sold in the period, including DVH prescription drug plan, and other products, which management views as additional commission revenue on our agents’ core function of MA/MS policy sales. Pharmacy revenue per MA/MS policy represents revenue from SelectRx and other revenue per MA/MS policy represents revenue from Population Health, production bonuses, marketing development funds, lead generation revenue, and adjustments from the Company’s reassessment of its cohorts’ transaction prices. Total operating expenses per MA/MS policy represents all of the operating expenses within Senior and Healthcare Services. The revenue to customer acquisition cost (“CAC”) multiple represents total revenue per MA/MS policy as a multiple of total marketing acquisition cost, which represents the direct costs of acquiring leads. These costs are included in marketing and advertising expense within the total operating expenses per MA/MS policy.

The following table shows combined Senior and Healthcare Services consumer per unit economics for the periods presented. Based on the seasonality of Senior and the fluctuations between quarters, we believe that the most relevant view of per unit economics is on a rolling 12-month basis. All per MA/MS policy metrics below are based on the sum of approved MA/MS policies, as both products have similar commission profiles.

	Twelve Months Ended March 31,
(dollars per approved policy):	2023			2022
Medicare Advantage and Medicare Supplement approved policies		586,238			636,195
Medicare Advantage and Medicare Supplement commission per MA/MS policy	$	886		$	963
Other commission per MA/MS policy		15			29
Pharmacy revenue per MA/MS policy		320			52
Other revenue per MA/MS policy		66			(64	)
Total revenue per MA/MS policy		1,287			980
Total operating expenses per MA/MS policy		(1,167	)		(1,176	)
Adjusted EBITDA per MA/MS policy *	$	120		$	(196	)
Adjusted EBITDA Margin per MA/MS policy *		9	%		(20	)%
Revenue/CAC multiple	3.5		X	1.8		X

Total revenue per MA/MS policy increased 31% for the twelve months ended March 31, 2023 compared to the twelve months ended March 31, 2022, primarily due to the increase in pharmacy revenue. Total operating expenses per MA/MS policy were nearly flat for the twelve months ended March 31, 2023 compared to the twelve months ended March 31, 2022, driven by a decrease in our marketing and advertising costs, which was offset by an increase in cost of goods sold-pharmacy revenue for Healthcare Services due to the growth of the business.

Life

Financial Results

The following table provides the financial results for the Life segment for the periods presented:

	Three Months Ended March 31,								Nine Months Ended March 31,
(in thousands)	2023			2022			% Change		2023			2022			% Change
Revenue	$	36,950		$	38,625		(4	)%	$	107,780		$	116,645		(8	)%
Adjusted EBITDA*		5,303			(2,662	)	299	%		16,371			(701	)	2435	%
Adjusted EBITDA Margin*		14	%		(7	)%				15	%		(1	)%

Operating Metrics

Life premium represents the total premium value for all policies that were approved by the relevant insurance carrier partner and for which the policy document was sent to the policyholder and payment information was received by the relevant insurance carrier partner during the indicated period. Because our commissions are earned based on a percentage of total premium, total premium volume for a given period is the key driver of revenue for our Life segment.

*See “Non-GAAP Financial Measures” below.

The following table shows term and final expense premiums for the periods presented:

	Three Months Ended March 31,						Nine Months Ended March 31,
(in thousands)	2023		2022		% Change		2023		2022		% Change
Term Premiums	$	17,528	$	14,933	17	%	$	48,450	$	45,990	5	%
Final Expense Premiums		19,308		28,532	(32	)%		58,766		83,718	(30	)%
Total	$	36,836	$	43,465	(15	)%		107,216		129,708	(17	)%

Auto & Home

Financial Results

The following table provides the financial results for the Auto & Home segment for the periods presented:

	Three Months Ended March 31,								Nine Months Ended March 31,
(in thousands)	2023			2022			% Change		2023			2022			% Change
Revenue	$	8,238		$	7,152		15	%	$	23,128		$	20,755		11	%
Adjusted EBITDA*		2,591			1,150		125	%		7,315			3,957		85	%
Adjusted EBITDA Margin*		31	%		16	%				32	%		19	%

Operating Metrics

Auto & Home premium represents the total premium value of all new policies that were approved by our insurance carrier partners during the indicated period. Because our commissions are earned based on a percentage of total premium, total premium volume for a given period is the key driver of revenue for our Auto & Home segment.

The following table shows premiums for the periods presented:

	Three Months Ended March 31,						Nine Months Ended March 31,
(in thousands):	2023		2022		% Change		2023		2022		% Change
Premiums	$	12,828	$	12,516	2	%	$	36,456	$	36,358	—	%

*See “Non-GAAP Financial Measures” below.

Earnings Conference Call

SelectQuote, Inc. will host a conference call with the investment community tomorrow, Thursday, May 11, 2023, beginning at 8:30 a.m. ET. To register for this conference call, please use this link: https://www.netroadshow.com/events/login?show=830b3ad4&confId=49510A. After registering, a confirmation will be sent via email, including dial-in details and unique conference call codes for entry. Registration is open through the live call, but to ensure you are connected for the full call we suggest registering at least 10 minutes before the start of the call. The event will also be webcasted live via our investor relations website https://ir.selectquote.com/investor-home/default.aspx.

Non-GAAP Financial Measures

This release includes certain non-GAAP financial measures intended to supplement, not substitute for, comparable GAAP measures. To supplement our financial statements presented in accordance with GAAP and to provide investors with additional information regarding our GAAP financial results, we have presented in this release Adjusted EBITDA and Adjusted EBITDA Margin, which are non-GAAP financial measures. These non-GAAP financial measures are not based on any standardized methodology prescribed by GAAP and are not necessarily comparable to similarly titled measures presented by other companies. We define Adjusted EBITDA as net income (loss) before interest expense, income tax expense (benefit), depreciation and amortization, and certain add-backs for non-cash or non-recurring expenses, including restructuring and share-based compensation expenses. The most directly comparable GAAP measure is net income (loss). We define Adjusted EBITDA Margin as Adjusted EBITDA divided by revenue. The most directly comparable GAAP measure is net income margin. We monitor and have presented in this release Adjusted EBITDA and Adjusted EBITDA Margin because they are key measures used by our management and Board of Directors to understand and evaluate our operating performance, to establish budgets, and to develop operational goals for managing our business. In particular, we believe that excluding the impact of these expenses in calculating Adjusted EBITDA can provide a useful measure for period-to-period comparisons of our core operating performance.

We believe that these non-GAAP financial measures help identify underlying trends in our business that could otherwise be masked by the effect of the expenses that we exclude in the calculations of these non-GAAP financial measures. Accordingly, we believe that these financial measures provide useful information to investors and others in understanding and evaluating our operating results, enhancing the overall understanding of our past performance and future prospects.

Reconciliations of net income (loss) to Adjusted EBITDA are presented below beginning on page 12.

Forward Looking Statements

This release contains forward-looking statements. These forward-looking statements reflect our current views with respect to, among other things, future events and our financial performance. These statements are often, but not always, made through the use of words or phrases such as “may,” “should,” “could,” “predict,” “potential,” “believe,” “will likely result,” “expect,” “continue,” “will,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “projection,” “would” and “outlook,” or the negative version of those words or other comparable words or phrases of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about our industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict. Although we believe that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements.

There are or will be important factors that could cause our actual results to differ materially from those indicated in these forward-looking statements, including, but not limited to, the following: the ultimate duration and impact of the ongoing COVID-19 pandemic and any other public health events, our reliance on a limited number of insurance carrier partners and any potential termination of those relationships or failure to develop new relationships; existing and future laws and regulations affecting the health insurance market; changes in health insurance products offered by our insurance carrier partners and the health insurance market generally; insurance carriers offering products and services directly to consumers; changes to commissions paid by insurance carriers and underwriting practices; competition with brokers, including exclusively online brokers and carriers who opt to sell policies directly to consumers; competition from government-run health insurance exchanges; developments in the U.S. health insurance system; our dependence on revenue from carriers in our senior segment and downturns in the senior health as well as life, automotive and home insurance industries; our ability to develop new offerings and penetrate new vertical markets; risks from third-party products; failure to enroll individuals during the Medicare annual enrollment period; our ability to attract, integrate and retain qualified personnel; our dependence on lead providers and ability to compete for leads; failure to obtain and/or convert sales leads to actual sales of insurance policies; access to data from consumers and insurance carriers; accuracy of information provided from and to consumers during the insurance shopping process; cost-effective advertisement through internet search engines; ability to contact consumers and market products by telephone; global economic conditions, including inflation; disruption to operations as a result of future acquisitions; significant estimates and assumptions in the preparation of our financial statements; impairment of goodwill; potential litigation and other legal proceedings or inquiries; our existing and future indebtedness; our ability to maintain compliance with our debt covenants; access to additional capital; failure to protect our intellectual property and our brand; fluctuations in our financial results caused by seasonality; accuracy and timeliness of commissions reports from insurance carriers; timing of insurance carriers’ approval and payment practices; factors that impact our estimate of the constrained lifetime value of commissions per policyholder; changes in accounting rules, tax legislation and other legislation; disruptions or failures of our technological infrastructure and platform; failure to maintain relationships with third-party service providers; cybersecurity breaches or other attacks involving our systems or those of our insurance carrier partners or third-party service providers; our ability to protect consumer information and other data; and failure to market and sell Medicare plans effectively or in compliance with laws. For a further discussion of these and other risk factors that could impact our future results and performance, see the section entitled “Risk Factors” in the most recent Annual Report on Form 10-K (the “Annual Report”) and subsequent periodic reports filed by us with the Securities and Exchange Commission. Accordingly, you should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, and, except as otherwise required by law, we do not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.

About SelectQuote:

Founded in 1985, SelectQuote (NYSE: SLQT) provides solutions that help consumers protect their most valuable assets: their families, health, and property. The company pioneered the model of providing unbiased comparisons from multiple, highly-rated insurance companies allowing consumers to choose the policy and terms that best meet their unique needs. Two foundational pillars underpin SelectQuote’s success: a strong force of highly-trained and skilled agents who provide a consultative needs analysis for every consumer, and proprietary technology that sources and routes high-quality leads.

With an ecosystem offering high touchpoints for consumers across Insurance, Medicare, Pharmacy, and Value-Based Care, the company now has four core business lines: SelectQuote Senior, SelectQuote Healthcare Services, SelectQuote Life, and SelectQuote Auto and Home. SelectQuote Senior serves the needs of a demographic that sees around 10,000 people turn 65 each day with a range of Medicare Advantage and Medicare Supplement plans. SelectQuote Healthcare Services is comprised of the SelectRx Pharmacy, a specialized medication management pharmacy, and Population Health which proactively connects its members with best-in-class healthcare services that fit each member’s unique healthcare needs. The platform improves health outcomes and lowers healthcare costs through proactive engagement and access to high-value healthcare solutions.


SELECTQUOTE, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (In thousands)

	March 31, 2023			June 30, 2022
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	92,048		$	140,997
Accounts receivable, net of allowances of $2.2 million and $0.6 million, respectively		211,686			129,748
Commissions receivable-current		68,531			116,277
Other current assets		11,504			15,751
Total current assets		383,769			402,773
COMMISSIONS RECEIVABLE—Net		753,003			722,349
PROPERTY AND EQUIPMENT—Net		31,601			41,804
SOFTWARE—Net		16,127			16,301
OPERATING LEASE RIGHT-OF-USE ASSETS		26,312			28,016
INTANGIBLE ASSETS—Net		27,019			31,255
GOODWILL		29,136			29,136
OTHER ASSETS		20,989			18,418
TOTAL ASSETS	$	1,287,956		$	1,290,052

LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable	$	31,608		$	24,766
Accrued expenses		23,162			26,002
Accrued compensation and benefits		49,087			42,150
Operating lease liabilities—current		5,958			5,261
Current portion of long-term debt		25,412			7,169
Contract liabilities		9,717			3,404
Other current liabilities		1,580			4,761
Total current liabilities		146,524			113,513
LONG-TERM DEBT, NET—less current portion		667,306			698,423
DEFERRED INCOME TAXES		49,134			50,080
OPERATING LEASE LIABILITIES		30,329			33,946
OTHER LIABILITIES		3,244			2,985
Total liabilities		896,537			898,947

COMMITMENTS AND CONTINGENCIES

SHAREHOLDERS’ EQUITY:
Common stock, par value		1,667			1,644
Additional paid-in capital		564,484			554,845
Accumulated deficit		(187,806	)		(177,100	)
Accumulated other comprehensive income		13,074			11,716
Total shareholders’ equity		391,419			391,105
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	1,287,956		$	1,290,052


SELECTQUOTE, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) (In thousands)

	Three Months Ended March 31,						Nine Months Ended March 31,
	2023			2022			2023			2022
REVENUE:
Commission	$	197,258		$	221,764		$	533,627		$	492,528
Pharmacy		66,948			18,478			159,641			31,715
Other		35,192			34,097			87,802			100,412
Total revenue		299,398			274,339			781,070			624,655

OPERATING COSTS AND EXPENSES:
Cost of revenue		79,186			96,491			235,827			319,469
Cost of goods sold—pharmacy revenue		62,302			19,294			154,753			34,338
Marketing and advertising		90,205			125,082			237,724			409,005
Selling, general, and administrative		27,544			24,705			86,662			70,495
Technical development		6,434			6,436			18,860			18,675
Total operating costs and expenses		265,671			272,008			733,826			851,982

INCOME (LOSS) FROM OPERATIONS		33,727			2,331			47,244			(227,327	)

INTEREST EXPENSE, NET		(21,105	)		(12,179	)		(58,885	)		(31,300	)
OTHER INCOME (EXPENSE), NET		(206	)		(23	)		(118	)		(177	)
INCOME (LOSS) BEFORE INCOME TAX EXPENSE (BENEFIT)		12,416			(9,871	)		(11,759	)		(258,804	)
INCOME TAX EXPENSE (BENEFIT)		3,152			(2,846	)		(1,053	)		(65,984	)

NET INCOME (LOSS)	$	9,264		$	(7,025	)	$	(10,706	)	$	(192,820	)

NET INCOME (LOSS) PER SHARE:
Basic	$	0.06		$	(0.04	)	$	(0.06	)	$	(1.17	)
Diluted	$	0.06		$	(0.04	)	$	(0.06	)	$	(1.17	)

WEIGHTED-AVERAGE COMMON STOCK OUTSTANDING USED IN PER SHARE AMOUNTS:
Basic		166,543			164,083			165,951			163,914
Diluted		167,905			164,083			165,951			163,914

OTHER COMPREHENSIVE INCOME (LOSS) NET OF TAX:
Gain (loss) on cash flow hedge		(2,661	)		7,589			1,358			9,358
OTHER COMPREHENSIVE INCOME (LOSS)		(2,661	)		7,589			1,358			9,358
COMPREHENSIVE INCOME (LOSS)	$	6,603		$	564		$	(9,348	)	$	(183,462	)


SELECTQUOTE, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (In thousands)

	Nine Months Ended March 31,
	2023			2022
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(10,706	)	$	(192,820	)
Adjustments to reconcile net loss to net cash and cash equivalents used in operating activities:
Depreciation and amortization		21,087			17,957
Loss on disposal of property, equipment, and software		390			741
Share-based compensation expense		8,525			6,252
Deferred income taxes		(1,416	)		(66,378	)
Amortization of debt issuance costs and debt discount		6,250			4,217
Write-off of debt issuance costs		710			—
Accrued interest payable in kind		8,450			—
Non-cash lease expense		3,115			3,065
Changes in operating assets and liabilities:
Accounts receivable, net		(62,738	)		(59,837	)
Commissions receivable		17,092			7,601
Other assets		3,166			(8,275	)
Accounts payable and accrued expenses		6,440			8,096
Operating lease liabilities		(4,331	)		(3,868	)
Other liabilities		(8,869	)		(1,113	)
Net cash used in operating activities		(12,835	)		(284,362	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment		(1,056	)		(24,515	)
Purchases of software and capitalized software development costs		(5,804	)		(7,570	)
Acquisition of business		—			(6,927	)
Investment in equity securities		—			(1,000	)
Net cash used in investing activities		(6,860	)		(40,012	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from Revolving Credit Facility		—			50,000
Payments on Revolving Credit Facility		—			(50,000	)
Proceeds from Term Loans		—			242,000
Payments on Term Loans		(17,833	)		(1,793	)
Payments on other debt		(123	)		(130	)
Proceeds from common stock options exercised and employee stock purchase plan		1,187			3,179
Payments of tax withholdings related to net share settlement of equity awards		(40	)		(148	)
Payments of debt issuance costs		(10,110	)		(328	)
Payment of acquisition holdback		(2,335	)		(5,501	)
Net cash (used in) provided by financing activities		(29,254	)		237,279
NET DECREASE IN CASH AND CASH EQUIVALENTS		(48,949	)		(87,095	)
CASH AND CASH EQUIVALENTS—Beginning of period		140,997			286,454
CASH AND CASH EQUIVALENTS—End of period	$	92,048		$	199,359


SELECTQUOTE, INC. AND SUBSIDIARIES Net Income (Loss) to Adjusted EBITDA Reconciliation (Unaudited)

	Three Months Ended March 31, 2023
(in thousands)	Senior			Healthcare Services			Life			Auto & Home			Corp & Elims			Consolidated
Revenue	$	185,200		$	70,725		$	36,950		$	8,238		$	(1,715	)	$	299,398
Operating expenses		(126,034	)		(74,091	)		(31,446	)		(5,648	)		(17,947	)		(255,166	)
Other income (expense), net		—			—			(201	)		1			(6	)		(206	)
Adjusted EBITDA		59,166			(3,366	)		5,303			2,591			(19,668	)		44,026
Share-based compensation expense																	(2,959	)
Non-recurring expenses																	(433	)
Depreciation and amortization																	(7,098	)
Loss on disposal of property, equipment, and software																	(15	)
Interest expense, net																	(21,105	)
Income tax expense																	(3,152	)
Net income																$	9,264

	Three Months Ended March 31, 2022
(in thousands)	Senior			Healthcare Services			Life			Auto & Home			Corp & Elims			Consolidated
Revenue	$	210,973		$	23,123		$	38,625		$	7,152		$	(5,534	)	$	274,339
Operating expenses		(171,023	)		(30,891	)		(41,287	)		(6,002	)		(12,896	)		(262,099	)
Other expenses, net		—			—			—			—			(23	)		(23	)
Adjusted EBITDA		39,950			(7,768	)		(2,662	)		1,150			(18,453	)		12,217
Share-based compensation expense																	(2,143	)
Non-recurring expenses																	(703	)
Depreciation and amortization																	(6,679	)
Loss on disposal of property, equipment, and software																	(384	)
Interest expense, net																	(12,179	)
Income tax benefit																	2,846
Net loss																$	(7,025	)

	Nine Months Ended March 31, 2023
(in thousands)	Senior			Healthcare Services			Life			Auto & Home			Corp & Elims			Consolidated
Revenue	$	486,541		$	169,270		$	107,780		$	23,128		$	(5,649	)	$	781,070
Operating expenses		(347,608	)		(193,726	)		(91,409	)		(15,812	)		(52,270	)		(700,825	)
Other expenses, net		—			—			—			(1	)		(117	)		(118	)
Adjusted EBITDA		138,933			(24,456	)		16,371			7,315			(58,036	)		80,127
Share-based compensation expense																	(8,525	)
Transaction costs																	(3,003	)
Depreciation and amortization																	(21,087	)
Loss on disposal of property, equipment, and software																	(386	)
Interest expense, net																	(58,885	)
Income tax benefit																	1,053
Net loss																$	(10,706	)

	Nine Months Ended March 31, 2022
(in thousands)	Senior			Healthcare Services			Life			Auto & Home			Corp & Elims			Consolidated
Revenue	$	459,272		$	40,183		$	116,645		$	20,755		$	(12,200	)	$	624,655
Operating expenses		(588,583	)		(60,296	)		(117,346	)		(16,798	)		(41,154	)		(824,177	)
Other expenses, net		—			—			—			—			(177	)		(177	)
Adjusted EBITDA		(129,311	)		(20,113	)		(701	)		3,957			(53,531	)		(199,699	)
Share-based compensation expense																	(6,252	)
Non-recurring expenses																	(2,857	)
Depreciation and amortization																	(17,957	)
Loss on disposal of property, equipment, and software																	(739	)
Interest expense, net																	(31,300	)
Income tax benefit																	65,984
Net loss																$	(192,820	)


SELECTQUOTE, INC. AND SUBSIDIARIES Net Loss to Adjusted EBITDA Reconciliation (Unaudited)

Guidance net loss to Adjusted EBITDA reconciliation, year ending June 30, 2023:

(in thousands)	Range
Net loss	$	(73,000	)	$	(55,000	)
Income tax benefit		(25,000	)		(19,000	)
Interest expense, net		80,000			80,000
Depreciation and amortization		28,000			28,000
Share-based compensation expense		12,000			12,000
Transaction costs		18,000			4,000
Adjusted EBITDA	$	40,000		$	50,000

View source version on businesswire.com: https://www.businesswire.com/news/home/20230510005967/en/

Investor Relations:

Sloan Bohlen

877-678-4083

[email protected]

Media:

Matt Gunter

913-286-4931

[email protected]

KEYWORDS: Kansas United States North America

INDUSTRY KEYWORDS: Professional Services Health Insurance Health Insurance Managed Care Pharmaceutical

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May 12, 2023 8:04 am

Orange County Business Journal Names Masimo’s Micah Young CFO of the Year

Orange County Business Journal Names Masimo’s Micah Young CFO of the Year

IRVINE, Calif.–(BUSINESS WIRE)–
Micah Young, Chief Financial Officer ofMasimo (NASDAQ: MASI), has been awarded CFO of the Year by the Orange County Business Journal (OCBJ). In presenting the award, Outstanding CFO of a Public Company, at last night’s ceremony in Irvine, OCBJ Publisher Richard Reisman commended Mr. Young for delivering strong shareholder returns, significantly increasing Masimo’s annual investor outreach, and playing a critical role in the execution of six acquisitions and one licensing deal – all since joining Masimo in 2017.

This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20230512005136/en/

Micah Young, Chief Financial Officer, Masimo (Photo: Business Wire)

Joe Kiani, Founder and CEO of Masimo, said, “I’m thrilled for Micah to receive such well-deserved accolades from OCBJ. In his six years with Masimo, he has quickly proved himself to be an invaluable asset to our company and one of my most trusted advisors. He’s helped propel us to new heights, delivering impressively for our shareholders and helping steer Masimo’s finances through a period of rapid growth and exciting expansion into new markets. Congratulations, Micah, and thank you to OCBJ for this recognition of his excellence.”

@Masimo | #Masimo

About Masimo

Masimo (NASDAQ: MASI) is a global medical technology company that develops and produces a wide array of industry-leading monitoring technologies, including innovative measurements, sensors, patient monitors, and automation and connectivity solutions. In addition, Masimo Consumer Audio is home to eight legendary audio brands, including Bowers & Wilkins, Denon, Marantz, and Polk Audio. Our mission is to improve life, improve patient outcomes, and reduce the cost of care. Masimo SET^® Measure-through Motion and Low Perfusion™ pulse oximetry, introduced in 1995, has been shown in over 100 independent and objective studies to outperform other pulse oximetry technologies.¹ Masimo SET^® has also been shown to help clinicians reduce severe retinopathy of prematurity in neonates,² improve CCHD screening in newborns³and, when used for continuous monitoring with Masimo Patient SafetyNet™ in post-surgical wards, reduce rapid response team activations, ICU transfers, and costs.^4-7Masimo SET^® is estimated to be used on more than 200 million patients in leading hospitals and other healthcare settings around the world,⁸ and is the primary pulse oximetry at 9 of the top 10 hospitals as ranked in the 2022-23 U.S. News and World Report Best Hospitals Honor Roll.⁹ In 2005, Masimo introduced rainbow^® Pulse CO-Oximetry technology, allowing noninvasive and continuous monitoring of blood constituents that previously could only be measured invasively, including total hemoglobin (SpHb^®), oxygen content (SpOC™), carboxyhemoglobin (SpCO^®), methemoglobin (SpMet^®), Pleth Variability Index (PVi^®), RPVi™ (rainbow^® PVi), and Oxygen Reserve Index (ORi™). In 2013, Masimo introduced the Root^® Patient Monitoring and Connectivity Platform, built from the ground up to be as flexible and expandable as possible to facilitate the addition of other Masimo and third-party monitoring technologies; key Masimo additions include Next Generation SedLine^® Brain Function Monitoring, O3^® Regional Oximetry, and ISA™ Capnography with NomoLine^® sampling lines. Masimo’s family of continuous and spot-check monitoring Pulse CO-Oximeters^® includes devices designed for use in a variety of clinical and non-clinical scenarios, including tetherless, wearable technology, such as Radius-7^®, Radius PPG^®, and Radius VSM™, portable devices like Rad-67^®, fingertip pulse oximeters like MightySat^® Rx, and devices available for use both in the hospital and at home, such as Rad-97^®. Masimo hospital and home automation and connectivity solutions are centered around the Masimo Hospital Automation™ platform, and include Iris^® Gateway, iSirona™, Patient SafetyNet, Replica^®, Halo ION^®, UniView^®, UniView :60™, and Masimo SafetyNet^®. Its growing portfolio of health and wellness solutions includes Radius Tº^® and the Masimo W1™ watch. Additional information about Masimo and its products may be found at www.masimo.com. Published clinical studies on Masimo products can be found at www.masimo.com/evidence/featured-studies/feature/.

ORi, RPVi, and Radius VSM have not received FDA 510(k) clearance and are not available for sale in the United States. The use of the trademark Patient SafetyNet is under license from University HealthSystem Consortium.

References

Published clinical studies on pulse oximetry and the benefits of Masimo SET^® can be found on our website at http://www.masimo.com. Comparative studies include independent and objective studies which are comprised of abstracts presented at scientific meetings and peer-reviewed journal articles.

Castillo A et al. Prevention of Retinopathy of Prematurity in Preterm Infants through Changes in Clinical Practice and SpO₂ Technology. Acta Paediatr. 2011 Feb;100(2):188-92.

de-Wahl Granelli A et al. Impact of pulse oximetry screening on the detection of duct dependent congenital heart disease: a Swedish prospective screening study in 39,821 newborns. BMJ. 2009;Jan 8;338.

Taenzer A et al. Impact of pulse oximetry surveillance on rescue events and intensive care unit transfers: a before-and-after concurrence study. Anesthesiology. 2010:112(2):282-287.

Taenzer A et al. Postoperative Monitoring – The Dartmouth Experience. Anesthesia Patient Safety Foundation Newsletter. Spring-Summer 2012.

McGrath S et al. Surveillance Monitoring Management for General Care Units: Strategy, Design, and Implementation. The Joint Commission Journal on Quality and Patient Safety. 2016 Jul;42(7):293-302.

McGrath S et al. Inpatient Respiratory Arrest Associated With Sedative and Analgesic Medications: Impact of Continuous Monitoring on Patient Mortality and Severe Morbidity. J Patient Saf. 2020 14 Mar. DOI: 10.1097/PTS.0000000000000696.

Estimate: Masimo data on file.

http://health.usnews.com/health-care/best-hospitals/articles/best-hospitals-honor-roll-and-overview.

Forward-Looking Statements

This press release includes forward-looking statements as defined in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, in connection with the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current expectations about future events affecting us and are subject to risks and uncertainties, all of which are difficult to predict and many of which are beyond our control and could cause our actual results to differ materially and adversely from those expressed in our forward-looking statements as a result of various risk factors, including, but not limited to: risks related to our assumptions regarding the repeatability of clinical results; risks related to our belief that Masimo’s unique noninvasive measurement technologies contribute to positive clinical outcomes and patient safety; risks related to our belief that Masimo noninvasive medical breakthroughs provide cost-effective solutions and unique advantages; risks related to COVID-19; as well as other factors discussed in the “Risk Factors” section of our most recent reports filed with the Securities and Exchange Commission (“SEC”), which may be obtained for free at the SEC’s website at www.sec.gov. Although we believe that the expectations reflected in our forward-looking statements are reasonable, we do not know whether our expectations will prove correct. All forward-looking statements included in this press release are expressly qualified in their entirety by the foregoing cautionary statements. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of today’s date. We do not undertake any obligation to update, amend or clarify these statements or the “Risk Factors” contained in our most recent reports filed with the SEC, whether as a result of new information, future events or otherwise, except as may be required under the applicable securities laws.

View source version on businesswire.com: https://www.businesswire.com/news/home/20230512005136/en/

Media Contact:

Masimo

Evan Lamb

949-396-3376

[email protected]

KEYWORDS: California United States North America

INDUSTRY KEYWORDS: Technology Medical Devices General Health Professional Services Hospitals Diabetes Biotechnology Wearables/Mobile Technology Health Health Technology Publishing Public Relations/Investor Relations Business Communications Software Finance Consulting

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Photo

Micah Young, Chief Financial Officer, Masimo (Photo: Business Wire)

Posted on May 12, 2023 8:04 am
Mannatech Reports First Quarter End 2023 Financial Results

Mannatech Reports First Quarter End 2023 Financial Results

FLOWER MOUND, Texas–(BUSINESS WIRE)–Mannatech, Incorporated(NASDAQ: MTEX), a global health and wellness company committed to transforming lives to make a better world, today announced financial results for its first quarter of 2023.

First Quarter End Results

First quarter net sales for 2023 were $34.1 million, an increase of $1.7 million, or 5.3%, as compared to $32.4 million in the first quarter of 2022. First quarter net sales for 2023 include the results of an annual promotion in March 2023 that occurred in April 2022. Our net sales increased 10.2% on a constant dollar basis (see Non-GAAP Measures, below) as foreign exchange decreased GAAP net sales by $1.6 million, mostly due to the decline of the Korean Won and Japanese Yen.

First quarter operating income for 2023 was $0.7 million as compared to less than $0.1 million for the first quarter of 2022.

Net income was $0.6 million, or $0.32 per diluted share, for the first quarter of 2023, as compared to net income of $0.1 million, or $0.06 per diluted share, for the first quarter of 2022.

For the three months ended March 31, 2023, overall selling and administrative expenses decreased by $0.5 million to $6.4 million, as compared to $6.9 million for the same period in 2022. The decrease in selling and administrative expenses consisted of a $0.4 million decrease in payroll costs and a $0.1 million decrease in warehouse costs.

For the three months ended March 31, 2023, other operating costs increased by $0.7 million to $5.6 million, as compared to $4.9 million for the same period in 2022. The increase in operating costs was primarily due to a $0.5 million increase in consulting fees, a $0.1 million increase in travel and entertainment and a $0.1 million increase in bad debt expense.

The approximate number of new and continuing independent associate and preferred customer positions held by individuals in Mannatech’s network and associated with purchases of products as of March 31, 2023 and 2022 were approximately 143,000 and 157,000, respectively. Recruitment of new independent associates and preferred customers increased by 0.03% to 18,547 in the first quarter of 2023 as compared to 18,542 in the first quarter of 2022.

Non-GAAP Measures

In addition to results presented in accordance with GAAP, this press release and related tables include certain non-GAAP financial measures, including a presentation of constant dollar measures. We disclose operating results that have been adjusted to exclude the impact of changes due to the translation of foreign currencies into U.S. dollars, including changes in: Net Sales, Gross Profit, and Income from Operations. We believe that these non-GAAP financial measures provide useful information to investors because they are an indicator of the strength and performance of ongoing business operations. The constant currency figures are financial measures used by management to provide investors an additional perspective on trends. Although we believe the non-GAAP financial measures enhance investors’ understanding of our business and performance, these non-GAAP financial measures should not be considered an exclusive alternative to accompanying GAAP financial measures. Please see the accompanying table entitled “Non-GAAP Financial Measures” for a reconciliation of these non-GAAP financial measures.

Safe Harbor statement

This release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. These forward-looking statements generally can be identified by use of phrases or terminology such as “may,” “will,” “should,” “hope,” “could,” “would,” “expects,” “plans,” “intends,” “anticipates,” “believes,” “estimates,” “approximates,” “predicts,” “projects,” “potential,” and “continues” or other similar words or the negative of such terminology. Similarly, descriptions of Mannatech’s objectives, strategies, plans, goals or targets contained herein are also considered forward-looking statements. Mannatech believes this release should be read in conjunction with all of its filings with the United States Securities and Exchange Commission and cautions its readers that these forward-looking statements are subject to certain events, risks, uncertainties, and other factors. Some of these factors include, among others, the impact of COVID-19 on Mannatech’s business, the availability and effectiveness of vaccines on a widespread basis, the impact of any mutations of the COVID-19 virus, the current conflict between Russia and Ukraine, which could adversely affect our business in certain regions, the impact of inflation, disruptions in the supply chain, Mannatech’s inability to attract and retain associates and preferred customers, increases in competition, litigation, regulatory changes, and its planned growth into new international markets. Although Mannatech believes that the expectations, statements, and assumptions reflected in these forward-looking statements are reasonable, it cautions readers to always consider all of the risk factors and any other cautionary statements carefully in evaluating each forward-looking statement in this release, as well as those set forth in its latest Annual Report on Form 10-K, and other filings filed with the United States Securities and Exchange Commission, including its current reports on Form 8-K. All of the forward-looking statements contained herein speak only as of the date of this release.

Individuals interested in Mannatech’s products or in exploring its business opportunity can learn more at Mannatech.com.

MANNATECH, INCORPORATED AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(in thousands, except share information)

ASSETS

March 31, 2023

(unaudited)

December 31,

2022

Cash and cash equivalents

$

13,682

$

13,777

Restricted cash

944

944

Accounts receivable, net of allowance of $1,109 and $973 in 2023 and 2022, respectively

133

218

Income tax receivable

449

423

Inventories, net

15,320

14,726

Prepaid expenses and other current assets

3,402

2,389

Deferred commissions

2,525

2,476

Total current assets

36,455

34,953

Property and equipment, net

4,654

3,759

Long-term restricted cash

465

476

Other assets

8,082

8,439

Deferred tax assets, net

1,064

1,501

Total assets

$

50,720

$

49,128

LIABILITIES AND SHAREHOLDERS’ EQUITY

Current portion of finance leases

$

252

$

61

Accounts payable

5,663

4,361

Accrued expenses

6,990

7,510

Commissions and incentives payable

10,248

9,256

Taxes payable

1,980

3,281

Current notes payable

616

263

Deferred revenue

5,504

5,106

Total current liabilities

31,253

29,838

Finance leases, excluding current portion

1,040

88

Other long-term liabilities

4,575

5,026

Total liabilities

36,868

34,952

Commitments and contingencies

Shareholders’ equity:

Preferred stock, $0.01 par value, 1,000,000 shares authorized, no shares issued or outstanding

—

—

Common stock, $0.0001 par value, 99,000,000 shares authorized, 2,742,857 shares issued and 1,873,608 shares outstanding as of March 31, 2023 and 2,742,857 shares issued and 1,858,800 shares outstanding as of December 31, 2022

—

—

Additional paid-in capital

33,277

33,377

Retained earnings

1,915

1,686

Accumulated other comprehensive (loss) income

(1,007

)

(208

)

Treasury stock, at average cost, 869,249 shares as of March 31, 2023 and 884,057 shares as of December 31, 2022

(20,333

)

(20,679

)

Total shareholders’ equity

13,852

14,176

Total liabilities and shareholders’ equity

$

50,720

$

49,128

MANNATECH, INCORPORATED AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share information)

Three Months Ended

March 31,

2023

2022

Net sales

$

34,114

$

32,384

Cost of sales

7,413

7,091

Gross profit

26,701

25,293

Operating expenses:

Commissions and incentives

13,558

13,108

Selling and administrative expenses

6,416

6,909

Depreciation and amortization expense

387

332

Other operating costs

5,627

4,909

Total operating expenses

25,988

25,258

Income from operations

713

35

Interest income, net

24

15

Other income, net

333

85

Income before income taxes

1,070

135

Income tax (provision)

(466

)

(1

)

Net income

$

604

$

134

Income per common share:

Basic

$

0.32

$

0.07

Diluted

$

0.32

$

0.06

Weighted-average common shares outstanding:

Basic

1,872

1,947

Diluted

1,891

2,074

Non-GAAP Financial Measures (Sales, Gross Profit and Income from Operations in Constant Dollars)

To supplement our financial results presented in accordance with generally accepted accounting principles in the United States (“GAAP”), we disclose operating results that have been adjusted to exclude the impact of changes due to the translation of foreign currencies into U.S. dollars, including changes in: Net Sales, Gross Profit, and Income from Operations. We refer to these adjusted financial measures as constant dollar items, which are non-GAAP financial measures. We believe these measures provide investors an additional perspective on trends. To exclude the impact of changes due to the translation of foreign currencies into U.S. dollars, we calculate current year results and prior year results at a constant exchange rate, which is the prior year’s rate. Currency impact is determined as the difference between actual growth rates and constant currency growth rates.

The table below reconciles first quarter 2023 constant dollar net sales, gross profit and income from operations to our GAAP net sales, gross profit and income from operations.

Three-month period ended (in millions, except percentages)

March 31, 2023

March 31, 2022

Constant $ Change

GAAP

Measure:

Total $

Non-GAAP Measure:

Constant $

GAAP

Measure:

Total $

Dollar

Percent

Net sales

$

34.1

$

35.7

$

32.4

$

3.3

10.2

%

Product

31.9

33.3

30.8

2.5

8.1

%

Pack sales and associate fees

2.1

2.2

1.3

0.9

69.2

%

Other

0.1

0.1

0.3

(0.2

)

(66.7

)%

Gross profit

26.7

27.9

25.3

2.6

10.3

%

Income from operations

0.7

1.1

—

1.1

—

%

View source version on businesswire.com: https://www.businesswire.com/news/home/20230512005098/en/

Donna Giordano

Manager, Executive Office Administration

972-471-6512

[email protected]

www.mannatech.com

KEYWORDS: Texas United States North America

INDUSTRY KEYWORDS: Other Retail General Health Health Specialty Vitamins/Supplements Fitness & Nutrition Retail Other Health

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Posted on May 12, 2023 8:04 am
EG Acquisition Corp. Announces Postponement of Special Meeting to May 19, 2023

EG Acquisition Corp. Announces Postponement of Special Meeting to May 19, 2023

NEW YORK–(BUSINESS WIRE)–
EG Acquisition Corp. (NYSE: EGGF) (“EG” or the “Company”), a Special Purpose Acquisition Company (“SPAC”), sponsored by EnTrust Global and GMF Capital, announced today that its previously announced special meeting (the “Meeting”), for the purpose of considering and voting on, among other proposals, to extend the date (the “Extension”) by which it must consummate an initial business combination, will be postponed from 10:00 a.m. Eastern Time on May 12, 2023 to 12:00 p.m. Eastern Time on May 19, 2023 (the “Postponement”) to allow the Company additional time to engage with stockholders. The Company filed a supplement (the “Proxy Supplement”) today to amend the definitive proxy statement, filed on April 21, 2023 (the “Definitive Proxy Statement”) to provide information about, among other things, (i) the postponement of the Special Meeting related to the Definitive Proxy Statement, (ii) the resulting extension of the deadline for delivery of redemption and redemption withdrawal requests from the Company’s stockholders to the Company’s transfer agent, and (iii) the disclosure that, its sponsor, EG Sponsor LLC, or its designees has agreed to loan us, for each one-month period during the Extension, the lesser of (x) $0.04 per public share that remains outstanding (and has not been redeemed) and (y) $160,000.

The record date for determining the Company stockholders entitled to receive notice of and to vote at the Meeting remains the close of business on April 17, 2023 (the “Record Date”). Stockholders as of the Record Date can vote, even if they have subsequently sold their shares. Stockholders who have previously submitted their proxies or otherwise voted and who do not want to change their vote need not take any action. Stockholders who have not yet done so are encouraged to vote as soon as possible.

As a result of the Postponement, the previously disclosed deadline of May 10, 2023 (two business days before the Meeting, as originally scheduled) for delivery of redemption requests from the Company’s stockholders to the Company’s transfer agent has been extended to May 17, 2023 (two business days before the postponed Meeting). Stockholders who wish to withdraw their previously submitted redemption requests may ask to do so prior to the postponed Meeting by requesting that the Company’s transfer agent return such shares by 5:00 p.m. Eastern Time on May 17, 2023. Stockholders who do not wish to withdraw their previously submitted redemption requests need not take any further action. If any such stockholders have questions or need assistance in connection with the Meeting, please contact the Company’s proxy solicitor, Morrow Sodali LLC, by calling (800) 662-5200, or banks and brokers can call collect at (203) 658-9400, or by emailing [email protected].

About EG Acquisition Corp.

EG Acquisition Corp. is a SPAC formed for the purpose of effecting a business combination with one or more businesses. It is sponsored by EnTrust Global and GMF Capital, and raised $225 million in its initial public offering on May 26, 2021.

Founded in 1997 by Chairman and CEO Gregg S. Hymowitz, EnTrust Global is a global investment firm with approximately $18 billion in total assets.¹ The firm manages assets for more than 500 institutional investors representing 48 countries. EnTrust has invested nearly $14 billion across approximately 160 transactions in both the private and public sectors, including transportation businesses. GMF Capital, a private investment platform founded by Gary Fegel in 2013, manages more than $1.5 billion in assets and has invested more than $5.5 billion of assets across 100+ transactions since inception, including in blank check companies and aviation industry assets.

At the time of the Company’s initial public offering, the sponsor agreed to not sell its founder shares for a period of three years after the business combination.

Additional Information

The Company filed the Definitive Proxy Statement with the SEC on April 21, 2023 in connection with the solicitation of proxies for the Special Meeting. This communication does not contain all the information that should be considered concerning the Special Meeting. The Company’sstockholders and other interested persons are advised to read the Definitive Proxy Statement and any amendments thereto, in connection with the Company’s solicitation of proxies for the Special Meeting to be held to approve the Extension Amendment Proposal and the Trust Amendment Proposal as these materials will contain important information. The definitive proxy statement will be mailed to the stockholders of the Company as of a record date to be established for voting on the Business Combination. Such stockholders will also be able to obtain copies of the definitive proxy statement, without charge, once available, at the SEC’s website at http://www.sec.gov.

Participants in the Solicitation

The Company, Sponsor and their respective directors, executive officers, other members of management, and employees, under SEC rules, may be deemed to be participants in the solicitation of proxies of the Company’s stockholders in connection with the Business Combination. Investors and security holders may obtain more detailed information regarding the names and interests in the Business Combination of the Company’s directors and officers in the Company’s filings with the SEC, including the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022, which was filed with the SEC on April 13, 2023, and the Preliminary Proxy Statement. Stockholders can obtain copies of the Company’s filings with the SEC, without charge, at the SEC’s website at www.sec.gov.

Cautionary Statement Regarding Forward-Looking Statements

This press release contains certain forward-looking statements within the meaning of the federal securities laws. These forward-looking statements generally are identified by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “intend,” “strategy,” “future,” “opportunity,” “plan,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and the Company assumes no obligation and does not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise.

No Offer or Solicitation

This communication is for informational purposes only and is neither an offer to purchase, nor a solicitation of an offer to sell, subscribe for or buy any securities or the solicitation of any vote in any jurisdiction pursuant to the Business Combination or otherwise, nor shall there be any sale, issuance or transfer of securities in any jurisdiction in contravention of applicable law. No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended, and otherwise in accordance with applicable law.

¹ As of January 31, 2023; based on estimates and includes assets under advisement and mandates awarded but not yet funded.

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Emma Tomas

[email protected]

KEYWORDS: New York United States North America

INDUSTRY KEYWORDS: Professional Services Finance

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Posted on May 12, 2023 8:03 am
Wells Fargo Announces Transition Information for Outstanding U.S. Dollar LIBOR-Linked Instruments

Wells Fargo Announces Transition Information for Outstanding U.S. Dollar LIBOR-Linked Instruments

SAN FRANCISCO–(BUSINESS WIRE)–
Wells Fargo & Company (NYSE: WFC) (“Wells Fargo”) and certain of its consolidated subsidiaries have issued debt securities, certificates of deposit, trust preferred securities and preferred stock and related depositary shares that reference the London Interbank Offered Rate (LIBOR) for deposits in U.S. dollars for a three-month tenor. The instruments addressed in this press release are governed by U.S. law or the laws of a U.S. State.

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Wells Fargo (Photo: Wells Fargo)

Debt Securities, Certificates of Deposit and Trust Preferred Securities

Wells Fargo is issuing this press release to advise that in accordance with (i) the Adjustable Interest Rate (LIBOR) Act and the final rule adopted by the Federal Reserve or (ii) the terms of such instruments, as applicable, after June 30, 2023 Three-month USD LIBOR in applicable debt securities, certificates of deposit, and trust preferred securities (the “Specified Instruments”) will be replaced with the CME Term SOFR Reference Rate published for a three-month tenor plus a spread adjustment of 0.26161%. The replacement of Three-month USD LIBOR with Three-month CME Term SOFR plus the spread adjustment will be effective for determinations made under the terms of the Specified Instruments after June 30, 2023. Additional information regarding the Specified Instruments will be made available through the LIBOR Benchmark Replacement Index solution through DTCC’s Legal Notice System.

Preferred Stock and Related Depositary Shares

Each series of Wells Fargo’s Fixed-to-Floating Rate Non-Cumulative Perpetual Class A Preferred Stock is governed by the terms of a certificate of designation (each, a “Certificate”) and will not transition to Three-month CME Term SOFR by operation of law or otherwise. The Certificate for each series specifically defines Three-month LIBOR to be a set rate (the “Set Rate”), as shown for each series in the table below, for a dividend period beginning on the date (the “Commencement Date”), as shown for each series in the table below, if Three-month LIBOR cannot otherwise be determined as provided in the applicable Certificate. In accordance with this definition of Three-month LIBOR, the dividend rate that will apply to any dividend payment date occurring after the applicable Commencement Date will be an annual rate equal to the Set Rate + the spread set forth in the Certificate for each series.

Fixed-to-Floating Rate Non-Cumulative Perpetual Class A Preferred Stock

CUSIP*

Set Rate (which is equal to the dividend rate preceding the Commencement Date)

Commencement Date

Spread

Dividend Rate following Commencement Date

Series Q

949746556

5.85%

September 15, 2023

3.09%

5.85% + 3.09%

Series R

949746465

6.625%

March 15, 2024

3.69%

6.625% + 3.69%

Series S

949746RG8

5.90%

June 15, 2024

3.11%

5.90% + 3.11%

Series U

949746RN3

5.875%

June 15, 2025

3.99%

5.875% + 3.99%

The cessation of Three-month LIBOR has no further impact on the terms of the Fixed-to-Floating Rate Non-Cumulative Perpetual Class A Preferred Stock.

*The CUSIP numbers are included solely for the convenience of holders. Wells Fargo shall not be responsible for the selection or use of these CUSIP numbers, nor is any representation made as to their correctness.

About Wells Fargo

Wells Fargo & Company (NYSE: WFC) is a leading financial services company that has approximately $1.9 trillion in assets, proudly serves one in three U.S. households and more than 10% of small businesses in the U.S., and is a leading middle market banking provider in the U.S. We provide a diversified set of banking, investment and mortgage products and services, as well as consumer and commercial finance, through our four reportable operating segments: Consumer Banking and Lending, Commercial Banking, Corporate and Investment Banking, and Wealth & Investment Management. Wells Fargo ranked No. 41 on Fortune’s 2022 rankings of America’s largest corporations. In the communities we serve, the company focuses its social impact on building a sustainable, inclusive future for all by supporting housing affordability, small business growth, financial health, and a low-carbon economy. News, insights, and perspectives from Wells Fargo are also available at Wells Fargo Stories.

Additional information may be found at www.wellsfargo.com | Twitter: @WellsFargo.

News Release Category: WF-CF

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Media

Beth Richek, 704-374-2545

[email protected]

Investor Relations

Tanya Quinn, 415-396-7495

[email protected]

KEYWORDS: California United States North America

INDUSTRY KEYWORDS: Banking Asset Management Professional Services Finance

MEDIA:

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Wells Fargo (Photo: Wells Fargo)

Posted on May 12, 2023 8:03 am
Lightning eMotors Inks Deal with Macnab EV Sales Corp. to Deliver 126 Zero-Emission Commercial Vehicles

Lightning eMotors Inks Deal with Macnab EV Sales Corp. to Deliver 126 Zero-Emission Commercial Vehicles

Vehicle deliveries have begun, and fulfillment is expected by end of year

Order consists of Lightning ZEV3™ and ZEV4™ cargo vans, passenger vans and shuttle buses

Transaction with leading Canadian vehicle distributor further expands Lightning’s presence in Canada

LOVELAND, Colo.–(BUSINESS WIRE)–
Lightning eMotors (NYSE: ZEV), a leading provider of zero-emission, medium-duty commercial vehicles and electric vehicle (EV) technology for fleets, today announced it has signed a contract with Macnab EV Sales Corp. to deliver 126 vehicles to the leading Canadian commercial vehicle distributor by the end of 2023.

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Lightning ZEV3™ vans ordered by Macnab EV Sales Corp. awaiting shipment to Canada (photo: Lightning eMotors)

“It’s an honor – and a testament to the quality and reliability of our vehicles – to receive this order from Macnab as they begin their foray into commercial EVs,” said Tim Reeser, CEO of Lightning eMotors. “We are proud they chose Lightning vehicles for their customer EV offering and look forward to getting these vehicles into customers’ hands this year as we further expand our footprint in Canada.”

Deliveries of Lightning’s ZEV3 vans to Macnab have already begun. The full order of 126 vehicles includes ZEV3 cargo and passenger van configurations and ZEV4 shuttle buses. Macnab has been a leader in the Canadian commercial transportation industry since 1935.

“Lightning was a pleasure to work with through our evaluation process,” said Matthew Bannon, president of Macnab EV Sales Corp. “We are confident in our choice and look forward to deploying these vehicles at a variety of locations across Canada.”

The deal also comes as Lightning ramps up production of its all-new, GM-based ZEV4 platform, featuring school bus, box truck and shuttle bus configurations. In addition, Lightning’s mobile DC fast charging system, Lightning Mobile, is now in production and reaching customers in the coming months.

To learn how to electrify your fleet with Lightning eMotors, please visit lightningemotors.com.

About Lightning eMotors

Lightning eMotors (NYSE: ZEV) has been providing specialized and sustainable fleet solutions since 2009, deploying complete zero-emission-vehicle (ZEV) solutions for commercial fleets since 2018. In that time, we have deployed a variety of vehicle classes and applications including but not limited to cargo and passenger vans, ambulances, transit and shuttle buses, school buses, specialty work trucks, and electric powertrains for school buses, transit buses and motor coaches. The Lightning eMotors team designs, engineers, customizes, and manufactures zero-emission vehicles to support the wide array of fleet customer needs with a full suite of control software, telematics, analytics, and charging solutions to simplify the buying and ownership experience and maximize uptime and energy efficiency. To learn more, visit our website at https://lightningemotors.com.

Forward-Looking Statements

Except for historical information herein, matters set forth in this press release are forward-looking within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including statements about the commercial and technology progress and future financial performance of Lightning eMotors, Inc. These forward-looking statements are identified by the use of words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “expand,” “enable,” “might,” “potential,” “should,” “would” among others. Forward-looking statements in this press release are subject to certain risks and uncertainties inherent in the company’s business that could cause actual results or outcomes to vary, including, but not limited to, risks related to Lightning eMotors’ operations and business and financial performance; the ability of Lightning eMotors to execute on its business strategy and grow demand for its products and revenue; potential increases in costs or shortage of raw materials; market acceptance of new product offerings; and other risks more fully described in Lightning eMotors’ filings with the Securities and Exchange Commission from time to time. 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. Lightning eMotors undertakes no obligation to update any forward-looking statements, except as required by law.

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Lightning eMotors’ News Media Contact:

Nick Bettis

(800) 223-0740

[email protected]

Lightning eMotors’ Investor Relations:

Brian Smith

(800) 223-0740

[email protected]

KEYWORDS: Colorado United States North America Canada

INDUSTRY KEYWORDS: Public Transport Alternative Vehicles/Fuels Trucking EV/Electric Vehicles Aftermarket Automotive General Automotive Transport Fleet Management

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Lightning ZEV3™ vans ordered by Macnab EV Sales Corp. awaiting shipment to Canada (photo: Lightning eMotors)

Posted on May 12, 2023 8:03 am
Zevia to Participate in Upcoming Investor Conferences

Zevia to Participate in Upcoming Investor Conferences

LOS ANGELES–(BUSINESS WIRE)–
Zevia PBC (“Zevia” or the “Company”) (NYSE: ZVIA), the company disrupting the liquid refreshment beverage industry with great tasting, zero sugar beverages made with simple, plant-based ingredients, today announced that its President and Chief Executive Officer, Amy Taylor and Chief Financial Officer, Denise Beckles will participate in two upcoming investor conferences. These include the Goldman Sachs Global Staples Forum, to be held May 16, 2023 in New York, NY and the BMO Global Farm to Market Conference, to be held May 17-18, 2023 in New York, NY.

At the Goldman Sachs Global Staples Forum, Ms. Taylor and Ms. Beckles will meet with investors and present at approximately 8:15 a.m. Eastern Time on Tuesday, May 16, 2023.

Additionally, Ms. Taylor and Ms. Beckles will meet with investors and present at the BMO Global Farm to Market Conference, at approximately 1:15 p.m. Eastern Time on Thursday, May 18, 2023.

Live webcasts of their presentations will be available on the Company’s Investor Relations section of Zevia’s website at https://investors.zevia.com/ during the event. Shortly following both events, a replay will be available at https://investors.zevia.com/ for approximately thirty (30) days.

About Zevia

Zevia PBC, a Delaware public benefit corporation designated as a “Certified B Corporation,” is focused on addressing the global health challenges resulting from excess sugar consumption by offering a broad portfolio of zero sugar, zero calorie, naturally sweetened beverages. All Zevia® beverages are made with a handful of simple, plant-based ingredients, contain no artificial sweeteners, and are Non-GMO Project verified, gluten-free, Kosher, vegan and zero sodium. Zevia is distributed in more than 32,000 retail locations in the U.S. and Canada through a diverse network of major retailers in the food, drug, mass, natural and ecommerce channels.

(ZEVIA-F)

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Media

Edelman

646-270-6797

[email protected]

Investors

Reed Anderson

ICR

646-277-1260

[email protected]

KEYWORDS: California New York United States North America

INDUSTRY KEYWORDS: Supermarket Retail Other Retail Food/Beverage

MEDIA:

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Posted on May 12, 2023 8:03 am
IonQ Announces Participation in 18th Annual Needham Technology & Media Conference

IonQ Announces Participation in 18^th Annual Needham Technology & Media Conference

COLLEGE PARK, Md.–(BUSINESS WIRE)–
IonQ, Inc. (NYSE: IONQ), a leader in quantum computing, today announced that Thomas Kramer, Chief Financial Officer, and Jordan Shapiro, Vice President of FP&A and Head of Investor Relations, will participate in a fireside chat at the 18^th Annual Needham Technology & Media Conference at the Intercontinental New York Times Square in New York City on Tuesday, May 16, 2023. The Company’s discussion will begin at 10:15 AM ET and the webcast link will be available on our Company’s website here, or directly here.

About IonQ

IonQ, Inc. is a leader in quantum computing, with a proven track record of innovation and deployment. IonQ’s current generation quantum computer, IonQ Forte, is the latest in a line of cutting-edge systems, boasting an industry-leading 29 algorithmic qubits. Along with record performance, IonQ has defined what it believes is the best path forward to scale.

IonQ is the only company with its quantum systems available through the cloud on Amazon Braket, Microsoft Azure and Google Cloud, as well as through direct API access. IonQ was founded in 2015 by Christopher Monroe and Jungsang Kim based on 25 years of pioneering research. To learn more, visit www.ionq.com.

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IonQ Media:

[email protected]

IonQ Investor:

[email protected]

KEYWORDS: New York Maryland United States North America

INDUSTRY KEYWORDS: Technology Other Technology

MEDIA:

Posted on May 12, 2023 7:48 am
MoonLake Immunotherapeutics Reports First Quarter 2023 Financial Results and Provides a Business Update

MoonLake Immunotherapeutics Reports First Quarter 2023 Financial Results and Provides a Business Update

Capital Markets Day held in April highlighted the differentiating features of sonelokimab and strong competitive position following competitor data in moderate-to-severe hidradenitis suppurativa (HS)

Preparations are well underway for the announcement of top-line results from a Phase 2 trial of sonelokimab in moderate-to-severe HS around the end of June with final read-out of 24-week data by Q4 this year

Patient enrollment in a global Phase 2 trial in active psoriatic arthritis (PsA) is on schedule with primary end-point readout expected in Q4 this year

Expected cash runway extended to the end of 2024

ZUG, Switzerland, May 12, 2023 – MoonLake Immunotherapeutics (NASDAQ:MLTX) (“MoonLake”), a clinical-stage biotechnology company focused on creating next-level therapies for inflammatory diseases, today provided a business update, following the filing of its first quarter financial results on May 11.

MoonLake continues to make substantial progress with the clinical development of sonelokimab, which is currently being investigated in two Phase II clinical trials: the first, ‘MIRA’, in moderate-to-severe HS and the second, ‘ARGO’, in PsA. Sonelokimab has already been successfully assessed in a randomized, placebo-controlled, Phase 2b trial in 313 patients with moderate-to-severe plaque-type psoriasis in which it demonstrated a rapid and durable skin clearance (PASI100). Sonelokimab efficiently inhibits IL-17F in addition to IL-17A and therefore could represent a major improvement in treating inflammation in these dermatological and rheumatological diseases. The Nanobody’s^® smaller size versus traditional antibodies and albumin-binding domain provide an opportunity for further efficacy.

Dr. Jorge Santos da Silva, Chief Executive Officer of MoonLake Immunotherapeutics, said:
“2023 has started off very strongly for MoonLake. Patient enrollment and randomization
were
completed ahead of schedule in our global Phase 2 trial of sonelokimab in moderate-to-severe HS and we are now anticipating announcement of the top-line results next month. We were delighted to reflect on the pivotal design of the trial and the baseline characteristics of enrolled patients in our Capital Markets Day in April together with Professor Kenneth B. Gordon, Chair of Dermatology at the Medical College of Wisconsin, and believe that our study is most comparable to the Phase 3 trials of competitors. Based on sonelokimab’s mechanism of action and unique characteristics, we are confident that we can ‘meet or beat’ the best results shown in such trials, which would translate into a greater than 20 percentage point delta on HiSCR 75 compared to placebo and represent a meaningful difference to the lives of patients with HS, an estimated $10bn market opportunity in the U
nited
S
tates
alone. Patient enrollment in our second global Phase 2 trial, in active PsA, is progressing well with primary end-point readout expected in Q4 of this year.”

Q1 highlights (including post-period end)

Patient enrollment and randomization completed ahead of schedule in a global Phase 2 trial of sonelokimab in moderate-to-severe HS (MIRA). This is the first global, randomized, double-blind, placebo-controlled trial using Hidradenitis Suppurativa Clinical Response (HiSCR) 75, a higher measure of clinical response, as its primary endpoint with top-line results anticipated next month.

Capital Markets Day hosted in New York on April 19^th featured a series of presentations from MoonLake’s executive team who provided a financial update and look to the year ahead at near-term catalysts and the Company’s publication roadmap. The event program highlighted key features of sonelokimab and included a clinical trial progress update. The program also referenced the release of important competitor data at the American Academy of Dermatology (AAD) Annual Meeting in March. In addition, external speaker Professor Kenneth B. Gordon, Chair of Dermatology at the Medical College of Wisconsin, provided an update on the treatment landscape and pipeline, reflecting on data and key takeaways from AAD.

Collaboration agreement signed with SHL Medical, a world-leading provider of advanced drug delivery solutions, to develop an autoinjector for clinical and potential subsequent commercial supply of MoonLake’s Nanobody^® sonelokimab.

First quarter 2023 financial results

As of March 31, 2023, MoonLake held cash, cash equivalents and short-term marketable debt securities of $63.1 million, compared to $72.1 million as of December 31, 2022, corresponding to a cash burn of $9.1 million¹ in the first quarter.

Research and development expenses for the quarter ended March 31, 2023, were $7.4 million, compared to $11.4 million in the previous quarter. The decrease was primarily due to a milestone expense under MoonLake’s in-license agreement of sonelokimab that was recognized in the previous quarter. General and administrative expenses for the quarter ended March 31, 2023 were $5.5 million, compared to $5.3 million in the previous quarter.

Matthias Bodenstedt, Chief Financial Officer at MoonLake Immunotherapeutics, said:
“MoonLake is in a very solid financial position
with a strong balance sheet. As a result of careful financial management, planning and operating efficiently, we have extended our
expected
cash runway to the end of 2024 which is 18 months beyond our upcoming readout in HS. This robust cash position also covers our other mid-stage PsA clinical readout, as well as the ongoing preparations for our Phase 3 programs, and thereby gives us a lot of financial flexibility and optionality. We have a unique asset in sonelokimab, which
we expect to
soon be Phase 3 ready in three multi-billion dollar indications.”

About MoonLake Immunotherapeutics

MoonLake Immunotherapeutics is a clinical-stage biopharmaceutical company unlocking the potential of sonelokimab, a novel investigational Nanobody^® for the treatment of inflammatory disease, to revolutionize outcomes for patients. Sonelokimab inhibits IL-17A and IL-17F by inhibiting the IL-17A/A, IL-17A/F, and IL-17F/F dimers that drive inflammation. The company’s focus is on inflammatory diseases with a major unmet need, including hidradenitis suppurativa and psoriatic arthritis – conditions affecting millions of people worldwide with a large need for improved treatment options. MoonLake was founded in 2021 and is headquartered in Zug, Switzerland. Further information is available on www.moonlaketx.com.

About Nanobodies
^®

Nanobodies^® represent a new generation of antibody-derived targeted therapies. They consist of one or more domains based on the small antigen-binding variable regions of heavy-chain-only antibodies (VHH). Nanobodies^® have a number of potential advantages over traditional antibodies, including their small size, enhanced tissue penetration, resistance to temperature changes, ease of manufacturing, and the ability to design multivalent therapeutic molecules with bespoke target combinations.

About Sonelokimab

Sonelokimab (M1095) is an investigational ~40 kDa humanized Nanobody^® consisting of three VHH domains covalently linked by flexible glycine-serine spacers. With two domains, sonelokimab selectively binds with high affinity to IL-17A and IL-17F, thereby inhibiting the IL-17A/A, IL-17A/F, and IL-17F/F dimers. A third central domain binds to human albumin, facilitating further enrichment of sonelokimab at sites of inflammatory edema.

Sonelokimab has been assessed in a randomized, placebo-controlled Phase 2b study in 313 patients with moderate-to-severe plaque-type psoriasis. Sonelokimab demonstrated a rapid and durable clinical response (Investigator’s Global Assessment Score 0 or 1, Psoriasis Area and Severity Index 90/100) in patients with moderate-to-severe plaque-type psoriasis. Sonelokimab was generally well tolerated, with a safety profile similar to the active control, secukinumab (Papp KA, et al. Lancet. 2021; 397:1564-1575).

In an earlier Phase 1 study in patients with moderate-to-severe plaque-type psoriasis, sonelokimab has been shown to decrease (to normal skin levels) the cutaneous gene expression of pro-inflammatory cytokines and chemokines (Svecova D. J Am Acad Dermatol. 2019;81:196–203). Recently, a global phase 2 trial in psoriatic arthritis (NCT05640245, M1095-PSA-201, “ARGO”) including multiple arms and over 200 patients has been initiated (announced on Dec 14, 2022).

Sonelokimab is not yet approved for use in any indication.

About the MIRA trial

The MIRA trial (M1095-HS-201) is a global, randomized, double-blind, placebo-controlled trial to evaluate the efficacy and safety of the Nanobody^® sonelokimab, administered subcutaneously, in the treatment of adult patients with active moderate to severe hidradenitis suppurativa. The trial will comprise over 200 patients, and will evaluate two different doses of sonelokimab, with placebo control and adalimumab as an active control reference arm. The primary endpoint of the trial is the percentage of participants achieving Hidradenitis Suppurativa Clinical Response 75 (HiSCR75), defined as a ≥75% reduction in total abscess and inflammatory nodule (AN) count with no increase in abscess or draining tunnel count relative to baseline. The trial will also evaluate a number of secondary endpoints, including the proportion of patients achieving HiSCR50, the change from baseline in International Hidradenitis Suppurativa Severity Score System (IHS4), the proportion of patients achieving a Dermatology Life Quality Index (DLQI) total score of ≤5, and the proportion of patients achieving at least 30% reduction from baseline in Numerical Rating Scale (NRS30) in the Patient’s Global Assessment of Skin Pain (PGA Skin Pain). Further details are available on: https://www.clinicaltrials.gov/ct2/show/NCT05322473

About the ARGO trial

The ARGO trial (M1095-PSA-201) is a global, randomized, double-blind, placebo-controlled trial to evaluate the efficacy and safety of the sonelokimab, administered subcutaneously, in the treatment of adult patients with active PsA. The trial is expected to comprise of approximately 200 patients, and is designed to evaluate different doses of sonelokimab, with placebo control and adalimumab as an active reference arm. The primary endpoint of the trial is the percentage of participants achieving ≥50% improvement in signs and symptoms of disease from baseline, compared to placebo, as measured by the American College of Rheumatology (ACR) 50 response. The trial will also evaluate a number of secondary endpoints, including improvement compared to placebo in ACR70, complete skin clearance as measured by at least a 100% improvement in the Psoriasis Area and Severity Index, physical function as measured by the Health Assessment Questionnaire-Disability Index, enthesitis as measured by the Leeds Enthesitis Index and pain as measured by the Patients Assessment of Arthritis Pain. Further details are available on: https://clinicaltrials.gov/ct2/show/NCT05640245

Cautionary Statement Regarding Forward Looking Statements

This press release contains certain “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements include, but are not limited to, statements regarding MoonLake’s expectations, hopes, beliefs, intentions or strategies regarding the future including, without limitation, statements regarding: plans for and timing of clinical trials, including patient enrollment in the MIRA and ARGO trials, the efficacy and safety of sonelokimab for the treatment of HS and PsA, including in comparison to existing standards or care or other competing therapies, clinical trials and research and development programs and the anticipated timing of the results from those studies and trials, and our anticipated cash usage and the period of time we anticipate such cash to be available. In addition, any statements that refer to projections, forecasts, or other characterizations of future events or circumstances, including any underlying assumptions, are forward- looking statements. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that statement is not forward looking.

Forward-looking statements are based on current expectations and assumptions that, while considered reasonable by MoonLake and its management, as the case may be, are inherently uncertain. New risks and uncertainties may emerge from time to time, and it is not possible to predict all risks and uncertainties. Actual results could differ materially from those anticipated in such forward-looking statements as a result of various risks and uncertainties, which include, without limitation, risks and uncertainties associated with MoonLake’s business in general and limited operating history, difficulty enrolling patients in clinical trials, state and federal healthcare reform measures that could result in reduced demand for MoonLake’s product candidates and reliance on third parties to conduct and support its preclinical studies and clinical trials.

Nothing in this press release should be regarded as a representation by any person that the forward-looking statements set forth herein will be achieved or that any of the contemplated results of such forward-looking statements will be achieved. You should not place undue reliance on forward-looking statements in this press release, which speak only as of the date they are made and are qualified in their entirety by reference to the cautionary statements herein. MoonLake does not undertake or accept any duty to release publicly any updates or revisions to any forward-looking statements to reflect any change in its expectations or in the events, conditions or circumstances on which any such statement is based.

CONTACT

MoonLake Immunotherapeutics Investors

Matthias Bodenstedt, CFO

[email protected]

MoonLake Immunotherapeutics Media

Patricia Sousa, Director Corporate Affairs

[email protected]

Matthew Cole, Mary-Jane Elliott

Consilium Strategic Communications

Tel: +44 (0) 20 3709 5700

[email protected]

[email protected]

MOONLAKE IMMUNOTHERAPEUTICS

CONDENSED CONSOLIDATED BALANCE SHEETS

(Amounts in
USD
, except share data
)

March 31, 2023 (Unaudited) December 31, 2022

Current assets

Cash and cash equivalents $        50,129,197 $        39,505,627

Short-term marketable debt securities         12,920,960         32,609,108

Other receivables         378,445         217,129

Prepaid expenses         3,075,862         4,179,468

Total current assets         66,504,464         76,511,332

Non-current assets

Operating lease right-of-use assets         246,256         282,580

Property and equipment, net         46,099         49,389

Total non-current assets         292,355         331,969

Total assets $        66,796,819         $        76,843,301

Current liabilities

Trade and other payables $        3,827,403         $        254,972

Short-term portion of operating lease liabilities         155,173         153,629

Accrued expenses and other current liabilities         3,296,839         7,256,845

Total current liabilities         7,279,415         7,665,446

Non-current liabilities

Long-term portion of operating lease liabilities         91,081         128,951

Pension liability         314,174         282,206

Total non-current liabilities         405,255         411,157

Total liabilities         7,684,670         8,076,603

Commitments and contingencies (Note 15)

Equity (deficit)

Class A Ordinary Shares: $0.0001 par value; 500,000,000 shares authorized; 39,154,203 shares issued and outstanding as of March 31, 2023; 38,977,600 shares issued and outstanding as of December 31, 2022         3,916         3,898

Class C Ordinary Shares: $0.0001 par value; 100,000,000 shares authorized; 13,546,908 shares issued and outstanding as of March 31, 2023; 13,723,511 shares issued and outstanding as of December 31, 2022         1,355         1,373

Additional paid-in capital         131,308,849         129,192,291

Accumulated deficit         (89,655,068)         (80,650,212)

Accumulated other comprehensive income (loss)         340,108         350,946

Total shareholders’ equity (deficit)         41,999,160         48,898,296

Noncontrolling interests         17,112,989         19,868,402

Total equity (deficit)         59,112,149         68,766,698

Total liabilities and equity (deficit) $        66,796,819 $        76,843,301

MOONLAKE IMMUNOTHERAPEUTICS

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(Unaudited)

(Amounts in USD, except share and per share data)

For the Three Months Period Ended

March 31, December 31, March 31,

2023 2022 2022

Operating expenses

Research and development $        (7,415,097) $        (11,369,112) $        (10,454,948)

General and administrative         (5,516,469)         (5,327,311)         (5,487,368)

Total operating expenses         (12,931,566)         (16,696,423)         (15,942,316)

Operating loss         (12,931,566)         (16,696,423)         (15,942,316)

Other income (expense), net 723,589 239,505 69,506

Loss before income tax         (12,207,977)         (16,456,918)         (15,872,810)

Income tax expense         (11,010)         (11,012)         (7,332)

Net loss $        (12,218,987) $        (16,467,930) $        (15,880,142)

Of which: net loss attributable to controlling interests shareholders         (9,004,856)         (11,861,934)         (15,880,142)

Of which: net loss attributable to noncontrolling interests shareholders         (3,214,131)         (4,605,996)         —

Net unrealized gain on marketable securities and short term investments         24,472         313,747         —

Actuarial gain (loss) on employee benefit plans         (42,144)         (187,557)         266,269

Other comprehensive income (loss)         (17,672)         126,190         266,269

Comprehensive loss $        (12,236,659) $        (16,341,740) $        (15,613,873)

Comprehensive loss attributable to controlling interests shareholders         (9,017,481)         (11,772,007)         (15,613,873)

Comprehensive loss attributable to noncontrolling interests         (3,219,178)         (4,569,733)         —

Weighted-average number of Class A Ordinary Shares, basic and diluted         39,061,977         38,843,776         —

Basic and diluted net loss per share attributable to controlling interests shareholders $        (0.23) $        (0.31) $        —

Weighted-average number of Common Shares²         —         —         5,013,646

Basic and diluted net loss per Common Share $        — $        — $        (3.17)

² As a result of the Business Combination, the Company has retroactively restated the weighted average number of shares outstanding prior to April 5, 2022 to give effect to the Exchange Ratio. For definitions of capitalized terms, refer to the unaudited condensed consolidated financial statements filed on Form 10-Q for the quarter ended March 31, 2023.

^¹ Values may not add up due to rounding.

Posted on May 12, 2023 7:38 am
AgileThought Reports First Quarter 2023 Financial Results

Continued Progress Towards Long-Term Goals

IRVING, Texas, May 12, 2023 (GLOBE NEWSWIRE) — AgileThought, Inc. (“AgileThought” or the “Company”) (NASDAQ: AGIL), a global provider of digital transformation services, custom software development, and next generation technologies, today reported results for the first quarter ended March 31, 2023.

First
Quarter
2023
Highlights and Results:

Revenue was $41.8 million, down 5.4% year over year from $44.2 million in Q1 2022 and down 2.8% sequentially from $43.1 million in Q4 2022, as the company continues to exit non-core revenues, and also witnessed some market volatility since mid-March.

Gross margin of 34.2% increased 290 bps year-over-year from 31.3% in Q1 2022, and increased 260 bps sequentially from 31.6% in Q4 2022. This implies a gross profit increase of 3.4% from Q1 2022 and a 5.2% increase from Q4 2022.

Four new clients added during the quarter.

“I am proud of our first quarter achievements. While the revenues in the quarter were below our guidance, impacted by the recent market volatility, we took strides in building our pipeline and feel strongly about the second half of this year. We continued our exit from non-core revenues, and small non-strategic accounts, which helped us perform better than expected on gross margin and is expected to help us towards revenue growth and improved gross margin. We look forward to continuing to enhance relationships with new and current clients by staying at the forefront of transformational technologies. Recently, we launched two new guilds: Applied AI and Gaming and appointed Eric Purdum as our new CRO. All these changes are key to position AgileThought as the market leader,” commented AgileThought Chief Executive Officer Manuel Senderos.

“Our continued exit from non-core revenues and small non-strategic accounts, along with our robust deal governance structure, helped us grow our gross margin and is expected to help us improve our SGA in the coming quarters. Together, this gives us confidence in achieving strong Adjusted Operating Income this year, and improving Adjusted Operating margin levels in the not too distant future. While the recent market volatility impacts our revenue projection for the full year, our improvements in gross margin and SGA are expected to help us achieve better Adjusted Operating Income for the full year than we previously expected,” commented AgileThought Chief Financial Officer Amit Singh.

Full Year
2023
Outlook

The table below summarizes AgileThought’s financial outlook for the full year of 2023¹.

Revenues for the full year 2023 of at least $185.0 million, implying at least 4.6% year over year growth

Gross margin for the full year 2023 in 34.5% to 35.5% range

Adjusted Operating Income for the full year of at least $13.7 million, implying at least 20.2% year over year growth

Our outlook reflects the Company’s ongoing exit from non-core business and small non-strategic accounts.

The above outlook is dependent on the availability to us of sufficient liquidity and capital resources. We are in default with respect to our principal financing arrangements and there is substantial doubt about our ability to continue as a going concern. As of April 30, 2023, we had available cash of $1.8 million. We are evaluating strategies to obtain the required additional funding for future operations , which strategies may include, but are not limited to, seeking private equity financing, restructuring our debt, seeking for strategic merger and acquisition alternatives, and restructuring operations to increase revenues and decrease expenses.

The Company is not able, at this time, to provide GAAP targets for operating income for the second quarter of 2023 because of the difficulty of estimating certain items excluded from Non-GAAP Adjusted Operating Income that cannot be reasonably predicted, such as the change in fair value of embedded derivative, plus the change in fair value of warrant liability, plus equity-based compensation expense, plus impairment charges, plus restructuring expenses, plus (gain) loss on business dispositions, plus loss on debt extinguishment, plus intangible assets amortization, plus certain transaction costs and certain other operating expense, net.

Conference Call and Webcast Information

AgileThought will host its first quarter 2023 Earnings Conference Call on Friday May 12, 2023, at 8:00 AM Eastern Time. The Earnings Conference Call may also include discussion of Company developments, forward-looking information and other material information about business and financial matters.

The first quarter 2023 Earnings Conference Call will be webcast live and via telephone. Those wishing to participate via webcast should access the call through the Company’s Investor Relations website at https://ir.agilethought.com/. Those wishing to participate via telephone may dial in at 1-888-770-7296 (domestic) or 1-929-203-0873 (international), Conference ID 2253206. The conference call replay will be available via webcast through the Company’s Investor Relations website.

A webcast replay of the call will be available approximately one hour after the end of the call through August 2, 2023. The webcast replay can be accessed via the above links.

A
bout AgileThought, Inc
.

AgileThought is a pure play leading provider of agile-first software at scale, end-to-end digital transformation and consulting services to Fortune 1000 customers with diversity across end-markets and industry verticals. For years, Fortune 1000 companies have trusted AgileThought to solve their digital challenges and optimize mission-critical systems to drive business value. AgileThought’s solution architects, developers, data scientists, engineers, transformation consultants, automation specialists, and other experts located across the United States and across Latin America deliver next-generation software solutions that accelerate the transition to digital platforms across business processes.

For more information, visit https://agilethought.com/.

Forward-Looking Statements

This press release includes financial guidance and other “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. AgileThought’s actual results may differ from the expectations, estimates, projections and other information included in these forward-looking statements, and consequently, you should not rely on these forward-looking statements as predictions of future events. Words such as “expect,” “estimate,” “project,” “budget,” “forecast,” “anticipates,” “intends,” “plans,” “may,” “will,” “could,” “should,” “believes,” “predicts,” “potential,” “continue,” and similar expressions are intended to identify such forward-looking statements. These forward-looking statements involve significant risks and uncertainties that could cause the actual results to differ materially from the expected results. Most of these factors are outside AgileThought’s control and are difficult to predict. Factors that may cause such differences include, but are not limited to: AgileThought’s financial and business performance; AgileThought’s ability to repay and/or continue to service its indebtedness; AgileThought’s future capital requirements and sources and uses of cash; AgileThought’s ability to obtain funding for future operations; AgileThought’s business, expansion plans and opportunities; changes in our strategy, future operations, financial position, estimated revenues and losses, projected costs, prospects and plans; AgileThought’s ability to develop, maintain and expand client relationships, including relationships with our largest clients; changes in domestic and foreign business, market, financial, political, regulatory and legal conditions; AgileThought’s ability to recognize the anticipated benefits of the business combination, which may be affected by, among other things, competition and our ability to grow and manage growth profitably; costs related to the business combination; AgileThought’s ability to successfully identify and integrate any future acquisitions; AgileThought’s ability to attract and retain highly skilled information technology professionals; AgileThought’s ability to maintain favorable pricing, utilization rates and productivity levels for our information technology professionals and their services; AgileThought’s ability to innovate successfully and maintain our relationships with key vendors; AgileThought’s ability to provide our services without security breaches and comply with changing regulatory, legislative and industry standard developments regarding privacy and data security matters; AgileThought’s ability to operate effectively in multiple jurisdictions in Latin America and in the United States in the different business, market, financial, political, legal and regulatory conditions in the different markets; developments and projections relating to our competitors and industry; expectations regarding the time during which we will be an emerging growth company under the Jumpstart Our Business Startups Act of 2012, as amended; changes in applicable laws or regulations; the outcome of any known and unknown litigation or legal proceedings and regulatory proceedings involving us; AgileThought’s ability to maintain the listing of our securities; and other risks and uncertainties indicated in AgileThought’s filings with the SEC. There may be additional risks that could cause actual results to differ from those contained in the forward-looking statements. In addition, forward-looking statements reflect AgileThought’s expectations, plans or forecasts of future events and views only as of the date of this press release. AgileThought anticipates that subsequent events and developments will cause its assessments to change. However, while AgileThought may elect to update these forward-looking statements at some point in the future, AgileThought specifically disclaims any responsibility to do so.

Investor Contact

Mariana Franco
(888) 257-3001
[email protected]

Key Business Metrics

We regularly monitor several financial and operating metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate financial projections and make strategic decisions. Our key non-GAAP and business metrics may be calculated in a different manner than similarly titled metrics used by other companies. For a reconciliation of non-GAAP to GAAP measures refer to our Non-GAAP Measures section further below.

Three Months Ended March 31,

2023 2022

Gross Profit Margin⁽¹⁾ 34.2 % 31.3 %

Loss from Operations (in thousands) $ (35,553 ) $ (10,055 )

Adjusted Operating Income (Loss) (in thousands) $ (1,186 ) $ 1,147

Net Loss (in thousands) $ (38,071 ) $ (6,298 )

Adjusted Net Loss (in thousands) $ (4,162 ) $ (437 )

Diluted EPS $ (0.80 ) $ (0.14 )

Adjusted Diluted EPS $ (0.09 ) $ (0.01 )

Number of large active clients (at or above $1.0 million of revenue in prior 12-month period) as of end of period⁽²⁾ 33 29

Revenue concentration with top 10 clients as of end of period⁽³⁾ 62.4 % 61.5 %

____________
(1) Calculated as net revenues for the period minus cost of revenue for the period, divided by net revenues.
(2) Defined as the number of active clients from whom we generated more than $1.0 million of revenue in the prior 12-month period. For comparability purposes, we include the clients of the acquired businesses that meet these criteria to properly evaluate total client spending evolution.
(3) Defined as the percent of our total revenue derived from our ten largest active clients.

AgileThought, Inc.

Unaudited Condensed Consolidated Statements of Operations

Three Months Ended March 31,

(in thousands USD)
2023 2022

Net revenues $ 41,844 $ 44,224

Cost of revenue 27,543 30,400

Gross profit 14,301 13,824

Operating expenses:

Selling, general and administrative expenses 15,417 12,619

Depreciation and amortization 1,863 1,754

Change in fair value of embedded derivative (1,379 ) —

Change in fair value of warrant liability (815 ) 478

Loss on debt extinguishment 10,162 7,136

Equity-based compensation expense 1,547 518

Impairment charges 19,070 —

Restructuring expense 2,517 753

Other operating expenses, net 1,472 621

Total operating expense 49,854 23,879

Loss from operations (35,553 ) (10,055 )

Interest expense, net (4,217 ) (3,313 )

Other income, net 1,718 7,321

Loss before income tax (38,052 ) (6,047 )

Income tax expense 19 251

Net loss (38,071 ) (6,298 )

Net (loss) income attributable to noncontrolling interests (12 ) 49

Net loss attributable to the Company $ (38,059 ) $ (6,347 )

Selected Balance Sheet Data

(in thousands USD)
March 31, 2023 December 31, 2022

Cash, cash equivalents and restricted cash $ 3,174 $ 8,691

Total assets 194,013 215,239

Total debt, net of unamortized debt issuance cost, debt premiums and debt discounts 84,523 76,056

Total liabilities 150,039 135,369

Total stockholders’ equity attributable to the Company 44,043 79,924

Selected Cash Flow Data

Three Months Ended March 31,

(in thousands USD)
2023 2022

Net cash used in operating activities $ (1,229 ) $ (5,111 )

Net cash used in investing activities (411 ) (83 )

Net cash used in financing activities (3,735 ) (669 )

Selected Segment Data

Three Months Ended March 31,

Revenue by Geography (in thousands) 2023 2022

United States $ 26,113 $ 28,998

Latin America 15,731 15,226

Total $ 41,844 $ 44,224

As of
March 31, As of December 31,

Employees by Geography 2023 2022 2022

United States 211 310 249

Latin America 2,044 2,320 2,255

Total 2,255 2,630 2,504

Non-GAAP Measures

To supplement our consolidated financial data presented on a basis consistent with U.S. GAAP, we present certain non-GAAP financial measures, including Adjusted Operating (Loss) Income, Adjusted Net Loss and Adjusted Diluted EPS. We have included the non-GAAP financial measures because they are financial measures used by our management to evaluate our core operating performance and trends, to make strategic decisions regarding the allocation of capital and new investments and are among the factors analyzed in making performance-based compensation decisions for key personnel. The measures exclude certain expenses that are required under U.S. GAAP. We exclude certain non-cash expenses and certain items that are not part of our core operations.

We believe these supplemental performance measurements are useful in evaluating operating performance, as they are similar to measures reported by our public industry peers and those regularly used by security analysts, investors and other interested parties in analyzing operating performance and prospects. The non-GAAP financial measures are not intended to be a substitute for any GAAP financial measures and, as calculated, may not be comparable to other similarly titled measures of performance of other companies in other industries or within the same industry.

There are significant limitations associated with the use of non-GAAP financial measures. Further, these measures may differ from the non-GAAP information, even where similarly titled, used by other companies and therefore should not be used to compare our performance to that of other companies. We compensate for these limitations by providing investors and other users of our financial information a reconciliation of our non-GAAP measures to the related GAAP financial measure. We encourage investors and others to review our financial information in its entirety, not to rely on any single financial measure and to view our non-GAAP measures in conjunction with GAAP financial measures.

We define and calculate our non-GAAP financial measures as follows:

Adjusted Operating (Loss) Income
: Loss from operations adjusted to exclude the change in fair value of embedded derivative, plus the change in fair value of warrant liability, plus equity-based compensation expense, plus impairment charges, plus restructuring expenses, plus (gain) loss on business dispositions, plus loss on debt extinguishment, plus intangible assets amortization, plus certain transaction costs and certain other operating expense, net.

Adjusted Net Loss
: Net loss adjusted to exclude the change in fair value of embedded derivative, plus the change in fair value of warrant liability, plus equity-based compensation expense, plus impairment charges, plus restructuring expenses, plus (gain) loss on business dispositions, plus foreign exchange loss (gain), plus loss (gain) on debt extinguishment and debt forgiveness, plus intangible assets amortization, plus certain transaction costs, plus paid in kind interest and amortization of debt issuance cost and certain other expense, net.

Adjusted Diluted EPS
: Adjusted Net loss, divided by the diluted weighted-average number of common shares outstanding for the period.

Reconciliation of Loss from Operations to Adjusted Operating (Loss) Income

The following table presents the reconciliation of our Adjusted Operating (Loss) Income to our Loss from operations, the most directly comparable GAAP measure, for the periods indicated:

Three Months Ended March 31,

(in thousands USD)
2023 2022

Loss from operations $ (35,553 ) $ (10,055 )

Change in fair value of embedded derivative (1,379 ) —

Change in fair value of warrant liability (815 ) 478

Equity-based compensation expense 1,547 518

Impairment charges 19,070 —

Restructuring expenses¹ 2,517 753

Loss on debt extinguishment 10,162 7,136

Intangible assets amortization 1,793 1,608

Transaction costs — 9

Other operating expense, net² 1,472 700

Adjusted Operating (Loss) Income $ (1,186 ) $ 1,147

1 – Represents restructuring expenses associated with the ongoing reorganization of our business operations and realignment efforts.
2 – Represents professional service fees primarily comprised of legal fees in connection with debt modifications, tax consulting fees in connection with review advisory and corporate consolidation project assessments, as well as a non-recurring recruiting fee.

Reconciliation of Net Loss to Adjusted Net Loss and Adjusted Dilutive EPS

The following table presents the reconciliation of our Adjusted Net Loss to our Net loss, the most directly comparable GAAP measure, for the periods indicated:

Three Months Ended March 31,

(in thousands USD, except shared data)
2023 2022

Net loss $ (38,071 ) $ (6,298 )

Change in fair value of embedded derivative (1,379 ) —

Change in fair value of warrant liability (815 ) 478

Equity-based compensation expense 1,547 518

Impairment charges 19,070 —

Restructuring expenses 2,517 753

Foreign exchange gain¹ (1,729 ) (252 )

Loss (Gain) on debt extinguishment and debt forgiveness 10,162 (144 )

Intangible assets amortization 1,793 1,608

Transaction costs — 9

Paid in kind interests and amortization of debt issuance cost, premiums and discounts 1,260 1,974

Other expense, net² 1,483 917

Adjusted Net Loss $ (4,162 ) $ (437 )

Number of shares used in Adjusted Diluted EPS 47,331,289 46,022,767

Adjusted Diluted EPS $ (0.09 ) $ (0.01 )

1 – Represents foreign exchange loss (gain) due to foreign currency transactions
2 – Represents professional service fees primarily comprised of legal fees in connection with debt modifications as well as other miscellaneous non-operating/ non-recurring items.

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