Market Newsdesk

February 27, 2023 4:22 pm

Ameresco Reports Fourth Quarter and Full Year 2022 Financial Results

Ameresco Reports Fourth Quarter and Full Year 2022 Financial Results

Record Year for Revenue and Profit

Fourth Quarter Results Reflected Revenue Push-Outs due to Scheduling Changes

Continued European Expansion

Guiding to Increased Adjusted EBITDA in 2023

Reiterating 2024 $300 Million Adjusted EBITDA Target

Full Year 2022 Financial Highlights:

(All financial result comparisons made are against the prior year period unless otherwise noted)

Revenues of $1,824.4 million, up 50%
Net income attributable to common shareholders of $94.9 million, up 35%
GAAP EPS of $1.78, up 32%
Non-GAAP EPS of $1.87, up 24%
Adjusted EBITDA of $204.5 million, up 34%
Fifth^{consecutive year of record revenue and profit}
Visibility from Projects, Assets and O&M is $6+ billion

Fourth Quarter 2022 Financial Highlights:

(All financial result comparisons made are against the prior year period unless otherwise noted)

Revenues of $331.7 million, down 20%
Net income attributable to common shareholders of $17.9 million, down 36%
GAAP EPS of $0.34, down 36%
Non-GAAP EPS of $0.35, down 34%
Adjusted EBITDA of $41.3 million, down 15%

FRAMINGHAM, Mass.–(BUSINESS WIRE)–
Ameresco, Inc. (NYSE:AMRC), a leading cleantech integrator specializing in energy efficiency and renewable energy, today announced financial results for the fiscal quarter ended December 31, 2022. The Company also furnished supplemental information in conjunction with this press release in a Current Report on Form 8-K. The supplemental information, which includes Non-GAAP financial measures, has been posted to the “Investors” section of the Company’s website at www.ameresco.com. Reconciliations of Non-GAAP measures to the appropriate GAAP measures are included herein.

“2022 was a great year and it marked Ameresco’s fifth consecutive year of record revenue and profit, growing revenue and adjusted EBITDA by 50% and 34%, respectively. This growth underscores the importance of our advanced clean technology portfolio, the strong fundamentals of our expanding markets, and our ability to consistently execute and capture additional market share. We ended the year with over $6 billion in visibility from the combination of our total project backlog, Energy Assets and O&M revenue backlog.

We made great strides in expanding our European footprint by winning of the transformative Bristol City Council decarbonization contract and acquiring a wind farm in Ireland. In addition, today we announced an agreement to acquire Enerqos Solutions S.r.l., a small but meaningful acquisition of an energy services company in Italy to further expand our European footprint. We anticipate further activity in Europe in 2023 as we continue to strategically extend our presence to take advantage of this large and growing market opportunity.

While execution remains strong, fourth quarter results reflected the push-out of revenue related to short term scheduling changes in implementation, supply chain issues and unplanned maintenance at two of our RNG facilities. In addition, utility and permitting delays impacted the timing of assets coming on-line. Despite the delays, we were able to place 24 MWe of Energy Assets in service during the quarter. We also added 32 MWe of new assets to our Assets in Development bringing the total to 470 net MWe.

Market demand conditions remain robust. In addition, we believe the recently enacted Inflation Reduction Act (IRA) will be the most transformational piece of legislation affecting our industry, further expanding our addressable market opportunities. We continue the dialogue with our customers as they assess how to prioritize and time their projects to optimize its impact.

The SCE projects progressed further in the quarter. We are continuing discussions regarding the applicability and scope of any force majeure relief resulting from COVID-19 and weather related delays. Our relationship with SCE continues to be cooperative, and we anticipate the projects to be in service and to achieve substantial completion milestones prior to the summer of 2023.

In the fourth quarter we were honored to be named a finalist in the S&P Global Platts 2022 Global Energy Awards for the Infrastructure Project of the Year and the Corporate Impact and Sustained Commitment categories. Platts highlighted our work at Fort Bragg, in collaboration with Duke Energy, to install the largest floating solar array in the Southeast,” concluded George P. Sakellaris, President and Chief Executive Officer.

Fourth Quarter Financial Results

(All financial result comparisons made are against the prior year period unless otherwise noted.)

Total revenue was 20% lower, driven by a 26% decrease in Project revenue. This decline primarily reflects the difficult comparisons to prior periods when we recognized significant revenue from the SCE projects. Energy Asset revenue declined 6% due to unscheduled maintenance at two of our RNG facilities, combined with lower RIN prices. O&M revenue increased 5% as the company continued to add long-term O&M contracts, especially on larger Federal government projects. Other revenue increased 16% primarily due to strength in integrated PV sales for remote power applications.

Gross margin of 18.6% reflects an increase from 17.1% in the previous year given the reduced contribution from the lower margin SCE projects. Net income attributable to common shareholders and adjusted EBITDA were $17.9 million and $41.3 million, respectively. The company ended the quarter with approximately $116 million of available cash. During the quarter, the Company also secured $137 million in project financing bringing the year’s total financing to over $468 million to continue supporting our growth.

(in millions)	4Q 2022			4Q 2021
	Revenue	Net Income ⁽¹⁾	Adj. EBITDA	Revenue	Net Income ⁽¹⁾	Adj. EBITDA
Projects	$247.2	$7.8	$15.5	$333.0	$11.4	$19.4
Energy Assets	$39.1	$7.0	$20.1	$41.8	$13.9	$24.7
O&M	$21.6	$2.0	$3.3	$20.5	$2.6	$3.9
Other	$23.8	$1.1	$2.3	$20.6	$0.3	$0.5
Total ⁽²⁾	$331.7	$17.9	$41.2	$415.9	$28.2	$48.5

(1) Net Income represents net income attributable to common shareholders
(2) Numbers in table may not sum due to rounding.

($ in millions)		At December 31, 2022
Awarded Project Backlog ⁽¹⁾		$1,639
Contracted Project Backlog		$1,001
Total Project Backlog		$2,640

O&M Revenue Backlog		$1,231
Energy Asset Visibility ⁽²⁾		$2,300
Operating Energy Assets		389 MWe
Ameresco’s Net Assets in Development ⁽³⁾		470 MWe

(1) Customer contracts that have not been signed yet

(2) Estimated contracted revenue and incentives during PPA period plus estimated additional revenue from operating RNG assets over a 20-year period, assuming RINs at $1.50/gallon and brown gas at $3.50/MMBtu with $3.00/MMBtu for LCFS on certain projects.

(3) Net MWe capacity includes only our share of any jointly owned assets

Project Highlights

In the Fourth Quarter of2022:

The Company continued to expand its streetlight portfolio by signing new contracts in Philadelphia, PA, Memphis, TN, and Chandler, AZ. The Philly Streetlight Improvement Project is a comprehensive 120,000 LED streetlight, controls, and networking project. The street light modernization project in Chandler will replace their high-pressure sodium fixtures across the city with state-of-the-art LED fixtures and provide control and monitoring on these fixtures.

Ameresco continued to expand its K-12 footprint across New York, adding more energy efficiency and solar projects to schools in Lakeland and Ossining. These schools will benefit with optimized learning environments for their students and teachers while saving money and reducing their carbon footprint.

Ameresco’s team in Canada continued to expand its federal footprint with an 8.8MW solar project with the CFB Gagetown, and a 40+ facility energy efficiency project with CBSA and Transport Canada National.

Ameresco continued to expand its C&I footprint with a new solar carport project in Buckeye, AZ. This project contracted with H&M Company will build solar carports for shaded parking and energy offset for a new distribution center for Ross Stores, Inc.

Asset Highlights

In the Fourth Quarter of 2022:

Ameresco’s Assets in Development ended the quarter at 530 MWe. After subtracting Ameresco’s partners’ minority interests, Ameresco’s owned capacity of Assets in Development at quarter end was 470 MWe.

The Company acquired an operating three-turbine 5MW wind farm in West County Cork, Ireland.

The County of Maui awarded Ameresco the rights to the landfill gas at the County’s Central Maui Landfill. Ameresco will build a landfill gas electric generating facility using 100% of the landfill gas available. Ameresco will design, engineer, construct, operate and maintain the 3.2 MW facility, which Ameresco will own.

The Company and Bright Canyon Energy broke ground on the Kūpono Solar Project at Joint Base Pearl Harbor-Hickam. The 131-Acre 42MW solar plant and 42MW/168MWh battery storage project is designed to deliver clean, renewable energy to Hawaiian Electric’s (HECO) grid on the island of O‘ahu.

Summary and Outlook

“2022 was an outstanding year of record performance across key financial metrics. Our future opportunities remain compelling, and we expect the number and complexity of projects to continue to increase as the IRA’s incentives are expected to lead to an estimated $3.5 trillion in investment in new energy supply and infrastructure onto the grid, the majority of which will be renewable sources. Ameresco is well positioned to capture an increasing share of this opportunity given our proven track record of execution on these types of large and complex solutions as shown by our SCE and Bristol projects. These secular growth drivers, together with the breadth of our technological expertise and proven track record, underpin our confidence in Ameresco’s prospects. As we continue to position the company to capture the global growth opportunities on the horizon, we are pleased to reiterate our $300 million adjusted EBITDA target for 2024.

2023 guidance, included in the table below, anticipates adjusted EBITDA growth of 5% at the midpoint. We are pleased to be guiding to growth in adjusted EBITDA even as we face difficult revenue comparisons due to the large SCE projects. Our ability to continue to grow our adjusted EBITDA is a testament to our long term diversified business model, designed for our profitable and growing Energy Asset and O&M businesses to offset potential short-term timing-related volatility in the Projects business. We anticipate placing between 80 and 100 MWe of energy assets in service. This includes the three RNG plants we had expected to be mechanically complete by the end of 2022. Several additional RNG assets are in the late stages of development and we expect that 4 or 5 of these will come online during 2024. Our expected capex for 2023 is $325 million to $375 million, the majority of which we expect to fund with non-recourse debt.

We estimate first quarter revenue and adjusted EBITDA to be in the range of $220 million to $240 million and $20 million to $30 million, respectively and slightly positive non-GAAP EPS. We expect the remainder of the year to follow our normal cadence with progressive improvement throughout the year.

We look forward to welcoming analysts and institutional investors on May 11^th to our London Investor Day. This event will feature presentations and panels by key executives from our leadership team. The conversations will focus on main growth opportunities. We also will be discussing Ameresco’s existing European footprint and plans for expansion in that geography,” Mr. Sakellaris concluded.

FY 2023 Guidance Ranges

Revenue

$1.45 billion

$1.55 billion

Gross Margin

19.5%

20.0%

Adjusted EBITDA

$210 million

$220 million

Interest Expense & Other

$30 million

$35 million

Effective Tax Rate

10%

5%

Non-GAAP EPS

$1.80

$1.90

The Company’s guidance excludes the impact of any redeemable non-controlling interest activity related to tax-equity partnerships, one-time charges, asset impairment charges, changes in contingent consideration, restructuring activities, as well as any related tax impact.

Conference Call/Webcast Information

The Company will host a conference call today at 4:30 p.m. ET to discuss fourth quarter and full year 2022 financial results, business and financial outlook and other business highlights. Participants may access the earnings conference call by pre-registering here at least fifteen minutes in advance. A live, listen-only webcast of the conference call will also be available over the Internet. Individuals wishing to listen can access the call through the “Investors” section of the Company’s website at www.ameresco.com. If you are unable to listen to the live call, an archived webcast will be available on the Company’s website for one year.

Use of Non-GAAP Financial Measures

This press release and the accompanying tables include references to adjusted EBITDA, Non- GAAP EPS, Non-GAAP net income and adjusted cash from operations, which are Non-GAAP financial measures. For a description of these Non-GAAP financial measures, including the reasons management uses these measures, please see the section following the accompanying tables titled “Exhibit A: Non-GAAP Financial Measures”. For a reconciliation of these Non-GAAP financial measures to the most directly comparable financial measures prepared in accordance with GAAP, please see Non-GAAP Financial Measures and Non-GAAP Financial Guidance in the accompanying tables.

About Ameresco, Inc.

Founded in 2000, Ameresco, Inc. (NYSE:AMRC) is a leading cleantech integrator and renewable energy asset developer, owner and operator. Our comprehensive portfolio includes energy efficiency, infrastructure upgrades, asset sustainability and renewable energy solutions delivered to clients throughout North America and Europe. Ameresco’s sustainability services in support of clients’ pursuit of Net-Zero include upgrades to a facility’s energy infrastructure and the development, construction, and operation of distributed energy resources. Ameresco has successfully completed energy saving, environmentally responsible projects with Federal, state, and local governments, healthcare and educational institutions, housing authorities, and commercial and industrial customers. With its corporate headquarters in Framingham, MA, Ameresco has more than 1,200 employees providing local expertise in the United States, Canada, and Europe. For more information, visit www.ameresco.com.

Safe Harbor Statement

Any statements in this press release about future expectations, plans and prospects for Ameresco, Inc., including statements about market conditions, pipeline, visibility and backlog, as well as estimated future revenues, net income, adjusted EBITDA, Non-GAAP EPS, gross margin, capital investments, other financial guidance, statements about our agreement with SCE including the impact of any delays, the closing of the Enerqos acquisition, and the impact of the IRA and macroeconomic conditions on our business, longer term outlook, and other statements containing the words “projects,” “believes,” “anticipates,” “plans,” “expects,” “will” and similar expressions, constitute forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by such forward looking statements as a result of various important factors, including the timing of, and ability to, enter into contracts for awarded projects on the terms proposed or at all; the timing of work we do on projects where we recognize revenue on a percentage of completion basis, including the ability to perform under signed contracts without delay and in accordance with their terms; demand for our energy efficiency and renewable energy solutions; our ability to complete and operate our projects on a profitable basis and as committed to our customers; our ability to arrange financing to fund our operations and projects and to comply with covenants in our existing debt agreements; changes in federal, state and local government policies and programs related to energy efficiency and renewable energy and the fiscal health of the government; the ability of customers to cancel or defer contracts included in our backlog; the output and performance of our energy plants and energy projects; the effects of our acquisitions and joint ventures; seasonality in construction and in demand for our products and services; a customer’s decision to delay our work on, or other risks involved with, a particular project; availability and cost of labor and equipment particularly given global supply chain challenges and global trade conflicts; our reliance on third parties for our construction and installation work; the addition of new customers or the loss of existing customers; the impact of macroeconomic challenges, weather related events and climate change on our business; global supply chain challenges, component shortages and inflationary pressures; market price of the Company’s stock prevailing from time to time; the nature of other investment opportunities presented to the Company from time to time; the Company’s cash flows from operations; cybersecurity incidents and breaches; and other factors discussed in our most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q. The forward-looking statements included in this press release represent our views as of the date of this press release. We anticipate that subsequent events and developments will cause our views to change. However, while we may elect to update these forward-looking statements at some point in the future, we specifically disclaim any obligation to do so. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to the date of this press release.

AMERESCO, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, except share amounts)

December 31,

2022

2021

ASSETS

Current assets:

Cash and cash equivalents

$

115,534

$

50,450

Restricted cash

20,782

24,267

Accounts receivable, net

174,009

161,970

Accounts receivable retainage

38,057

43,067

Costs and estimated earnings in excess of billings

576,363

306,172

Inventory, net

14,218

8,807

Prepaid expenses and other current assets

38,617

25,377

Income tax receivable

7,746

5,261

Project development costs, net

16,025

13,214

Total current assets

1,001,351

638,585

Federal ESPC receivable

509,507

557,669

Property and equipment, net

15,707

13,117

Energy assets, net

1,181,525

856,531

Goodwill, net

70,633

71,157

Intangible assets, net

4,693

6,961

Operating lease assets

38,224

41,982

Restricted cash, non-current portion

13,572

12,337

Deferred income tax assets, net

3,045

3,703

Other assets

38,564

22,779

Total assets

$

2,876,821

$

2,224,821

LIABILITIES, REDEEMABLE NON-CONTROLLING INTERESTS AND STOCKHOLDERS’ EQUITY

Current liabilities:

Current portions of long-term debt and financing lease liabilities

331,479

78,934

Accounts payable

349,126

308,963

Accrued expenses and other current liabilities

89,166

43,311

Current portion of operating lease liabilities

5,829

6,276

Billings in excess of cost and estimated earnings

34,796

35,918

Income taxes payable

1,672

822

Total current liabilities

812,068

474,224

Long-term debt and financing lease liabilities, net of current portion, unamortized discount and debt issuance costs

568,635

377,184

Federal ESPC liabilities

478,497

532,287

Deferred income tax liabilities, net

9,181

3,871

Deferred grant income

7,590

8,498

Long-term operating lease liabilities, net of current portion

31,703

35,135

Other liabilities

49,493

43,176

Commitments and contingencies:

Redeemable non-controlling interests, net

$

46,623

$

46,182

Stockholders’ equity:

Preferred stock, $0.0001 par value, 5,000,000 shares authorized, no shares issued and outstanding at December 31, 2022 and 2021

—

—

Class A common stock, $0.0001 par value, 500,000,000 shares authorized, 36,050,157 shares issued and 33,948,362 shares outstanding at December 31, 2022, 35,818,104 shares issued and 33,716,309 shares outstanding at December 31, 2021

3

3

Class B common stock, $0.0001 par value, 144,000,000 shares authorized, 18,000,000 shares issued and outstanding at December 31, 2022 and 2021

2

2

Additional paid-in capital

306,314

283,982

Retained earnings

533,549

438,732

Accumulated other comprehensive loss, net

(4,051

)

(6,667

)

Treasury stock, at cost, 2,101,795 shares at December 31, 2022 and 2021

(11,788

)

(11,788

)

Stockholders’ equity before non-controlling interest

824,029

704,264

Non-controlling interests

49,002

—

Total stockholders’ equity

873,031

704,264

Total liabilities, redeemable non-controlling interests and stockholders’ equity

$

2,876,821

$

2,224,821

AMERESCO, INC.

CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share amounts)

Three Months Ended December 31,

Year Ended December 31,

2022

2021

2022

2021

(Unaudited)

(Unaudited)

Revenues

$

331,727

$

415,893

$

1,824,422

$

1,215,697

Cost of revenues

270,131

344,580

1,533,589

985,340

Gross profit

61,596

71,313

290,833

230,357

Selling, general and administrative expenses

39,282

39,272

157,841

134,923

Operating income

22,314

32,041

132,992

95,434

Other expenses, net

7,397

3,611

27,273

17,290

Income before income taxes

14,917

28,430

105,719

78,144

Income tax expense (benefit)

(3,726

)

(1,164

)

7,170

(2,047

)

Net income

18,643

29,594

98,549

80,191

Net income attributable to non-controlling interest and redeemable non-controlling interest

(708

)

(1,388

)

(3,623

)

(9,733

)

Net income attributable to common shareholders

$

17,935

$

28,206

$

94,926

$

70,458

Net income per share attributable to common shareholders:

Basic

$

0.34

$

0.55

$

1.83

$

1.38

Diluted

$

0.34

$

0.53

$

1.78

$

1.35

Weighted average common shares outstanding:

Basic

51,925

51,644

51,841

50,855

Diluted

53,332

53,018

53,278

52,268

AMERESCO, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

Year Ended December 31,

2022

2021

Cash flows from operating activities:

Net income

$

98,549

$

80,191

Adjustments to reconcile net income to net cash flows from operating activities:

Depreciation of energy assets, net

49,755

43,113

Depreciation of property and equipment

2,665

3,143

Amortization of debt discount and debt issuance costs

4,211

2,849

Amortization of intangible assets

1,858

321

Net increase in fair value of contingent consideration

1,614

—

Accretion of ARO

146

123

(Recoveries of) provision for bad debts

(382

)

187

Impairment of long-lived assets / loss on disposal

937

1,901

Gain on sale of equity investments

—

(575

)

(Earnings) loss of unconsolidated entities

(1,647

)

118

Net (gain) loss from derivatives

(212

)

240

Stock-based compensation expense

15,046

8,716

Deferred income taxes, net

3,918

(4,760

)

Unrealized foreign exchange (gain) loss

(123

)

142

Changes in operating assets and liabilities:

Accounts receivable

3,477

(15,953

)

Accounts receivable retainage

4,716

(12,882

)

Federal ESPC receivable

(259,499

)

(249,728

)

Inventory, net

(5,411

)

(232

)

Costs and estimated earnings in excess of billings

(272,629

)

(113,192

)

Prepaid expenses and other current assets

(3,182

)

1,770

Project development costs

(685

)

1,949

Other assets

(11,327

)

(1,870

)

Accounts payable, accrued expenses, and other current liabilities

36,155

83,473

Billings in excess of cost and estimated earnings

449

(693

)

Other liabilities

(5,074

)

(5,036

)

Income taxes payable, net

(1,613

)

4,389

Cash flows from operating activities

(338,288

)

(172,296

)

Cash flows from investing activities:

Purchases of property and equipment

(5,296

)

(4,896

)

Capital investment in energy assets

(304,596

)

(170,277

)

Capital investment in major maintenance of energy assets

(18,007

)

(8,602

)

Grant award proceeds for energy assets

—

774

Proceeds from sale of equity investment

—

1,672

Acquisitions, net of cash received

—

(14,928

)

Contributions to equity investment

—

(9,000

)

Loans to joint venture investments

(459

)

—

Cash flows from investing activities

$

(328,358

)

$

(205,257

)

Year Ended December 31,

2022

2021

Cash flows from financing activities:

Proceeds from equity offering, net of offering costs

$

—

$

120,084

Payments of debt discount and debt issuance costs

(3,695

)

(2,919

)

Proceeds from exercises of options and ESPP

5,963

6,927

Proceeds from (payments on) senior secured revolving credit facility, net

137,900

(8,073

)

Proceeds from long-term debt financings

468,476

185,994

Proceeds from Federal ESPC projects

238,360

159,216

Net proceeds for customer energy asset projects

14,341

2,033

Investment fund call option exercise

(839

)

(1,000

)

Contributions from non-controlling interest

32,706

—

(Distributions to) proceeds from redeemable non-controlling interests, net

(1,128

)

1,399

Payments on long-term debt and financing leases

(161,857

)

(98,200

)

Cash flows from financing activities

730,227

365,461

Effect of exchange rate changes on cash

(747

)

309

Net increase (decrease) in cash, cash equivalents, and restricted cash

62,834

(11,783

)

Cash, cash equivalents, and restricted cash, beginning of year

87,054

98,837

Cash, cash equivalents, and restricted cash, end of year

$

149,888

$

87,054

Non-GAAP Financial Measures (Unaudited, in thousands)

Three Months Ended December 31, 2022

Adjusted EBITDA:

Projects

Energy

Assets

O&M

Other

Consolidated

Net income attributable to common shareholders

$

7,791

$

6,972

$

2,040

$

1,132

$

17,935

Impact from redeemable non-controlling interests

90

618

—

—

708

Plus (less): Income tax provision (benefit)

538

(5,131

)

573

294

(3,726

)

Plus: Other expenses, net

2,402

4,563

173

259

7,397

Plus: Depreciation and amortization

710

12,568

247

323

13,848

Plus: Stock-based compensation

3,137

496

274

302

4,209

Plus: Restructuring and other charges

859

26

2

13

900

Adjusted EBITDA

$

15,527

$

20,112

$

3,309

$

2,323

$

41,271

Adjusted EBITDA margin

6.3

%

51.5

%

15.3

%

9.7

%

12.4

%

Three Months Ended December 31, 2021

Adjusted EBITDA:

Projects

Energy

Assets

O&M

Other

Consolidated

Net income (loss) attributable to common shareholders

$

11,434

$

13,911

$

2,593

$

268

$

28,206

Impact from redeemable non-controlling interests

—

1,388

—

—

1,388

Plus (less): Income tax provision (benefit)

3,431

(5,429

)

663

171

(1,164

)

(Less) plus: Other (income) expenses, net

264

3,260

(3

)

90

3,611

Plus: Depreciation and amortization

634

11,144

405

307

12,490

Plus: Stock-based compensation

3,551

446

219

219

4,435

Plus: Restructuring and other charges

81

6

1

1

89

Less: Gain on sale of equity investment

$

—

$

—

$

—

$

(571

)

$

(571

)

Adjusted EBITDA

$

19,395

$

24,726

$

3,878

$

485

$

48,484

Adjusted EBITDA margin

5.8

%

59.2

%

18.9

%

2.4

%

11.7

%

Year Ended December 31, 2022

Adjusted EBITDA:

Projects

Energy

Assets

O&M

Other

Consolidated

Net income attributable to common shareholders

$

49,646

$

32,555

$

8,765

$

3,960

$

94,926

Impact from redeemable non-controlling interests

90

3,533

—

—

3,623

Plus (less): Income tax provision (benefit)

15,853

(13,168

)

2,798

1,687

7,170

Plus: Other expenses, net

10,592

15,499

528

654

27,273

Plus: Depreciation and amortization

3,029

48,589

1,160

1,500

54,278

Plus: Stock-based compensation

12,073

1,398

740

835

15,046

Plus: Restructuring and other charges

2,102

5

16

73

2,196

Adjusted EBITDA

$

93,385

$

88,411

$

14,007

$

8,709

$

204,512

Adjusted EBITDA margin

6.3

%

54.5

%

16.5

%

9.1

%

11.2

%

Year Ended December 31, 2021

Adjusted EBITDA:

Projects

Energy

Assets

O&M

Other

Consolidated

Net income attributable to common shareholders

$

35,515

$

26,197

$

8,353

$

393

$

70,458

Impact from redeemable non-controlling interests

—

9,733

—

—

9,733

Plus (less): Income tax provision (benefit)

3,482

(7,774

)

1,547

698

(2,047

)

Plus: Other expenses, net

2,117

14,794

41

338

17,290

Plus: Depreciation and amortization

2,414

41,122

1,710

1,331

46,577

Plus: Stock-based compensation

6,607

1,031

530

548

8,716

Plus: Energy asset impairment

—

1,901

—

—

1,901

Plus: Restructuring and other charges

260

43

37

318

658

Less: Gain on sale of equity investment

—

—

—

(571

)

(571

)

Adjusted EBITDA

$

50,395

$

87,047

$

12,218

$

3,055

$

152,715

Adjusted EBITDA margin

5.6

%

57.6

%

15.5

%

3.7

%

12.6

%

Three Months Ended December 31,

Year Ended December 31,

2022

2021

2022

2021

Non-GAAP net income and EPS:

Net income attributable to common shareholders

$

17,935

$

28,206

$

94,926

$

70,458

Adjustment for accretion of tax equity financing fees

(27

)

(27

)

(116

)

(116

)

Impact from redeemable non-controlling interests

708

1,388

3,623

9,733

Plus: Energy asset impairment

—

—

—

1,901

Plus: Contingent consideration, restructuring and other charges

900

89

2,196

658

Less: Gain on sale of equity investment

—

(571

)

—

(571

)

Income tax effect of Non-GAAP adjustments

(645

)

(2,421

)

(983

)

(3,063

)

Non-GAAP net income

$

18,871

$

26,664

$

99,646

$

79,000

Diluted net income per common share

$

0.34

$

0.53

$

1.78

$

1.35

Effect of adjustments to net income

0.01

—

0.09

0.16

Non-GAAP EPS

$

0.35

$

0.53

$

1.87

$

1.51

Adjusted cash from operations:

Cash flows from operating activities

$

(65,119

)

$

(55,952

)

$

(338,288

)

$

(172,296

)

Plus: proceeds from Federal ESPC projects

64,495

45,031

238,360

159,216

Adjusted cash from operations

$

(624

)

$

(10,921

)

$

(99,928

)

$

(13,080

)

Other Financial Measures (In thousands) (Unaudited)

Three Months Ended December 31,

Year Ended December 31,

2022

2021

2022

2021

New contracts and awards:

New contracts

$

315,250

$

1,064,000

$

973,050

$

1,515,000

New awards ⁽¹⁾

$

260,400

$

1,080,000

$

1,068,940

$

1,798,000

(1) Represents estimated future revenues from projects that have been awarded, though the contracts have not yet been signed.

Non-GAAP Financial Guidance

Adjusted earnings before interest, taxes, depreciation and amortization (adjusted EBITDA):

Year Ended December 31, 2023

Low

High

Operating income ⁽¹⁾

$132 million

$140 million

Depreciation and amortization

$59 million

$60 million

Stock-based compensation

$19 million

$20 million

Adjusted EBITDA

$210 million

$220 million

(1) Although net income is the most directly comparable GAAP measure, this table reconciles adjusted EBITDA to operating income because we are not able to calculate forward-looking net income without unreasonable efforts due to significant uncertainties with respect to the impact of accounting for our redeemable non-controlling interests and taxes.

Exhibit A: Non-GAAP Financial Measures

We use the Non-GAAP financial measures defined and discussed below to provide investors and others with useful supplemental information to our financial results prepared in accordance with GAAP. These Non-GAAP financial measures should not be considered as an alternative to any measure of financial performance calculated and presented in accordance with GAAP. For a reconciliation of these Non-GAAP measures to the most directly comparable financial measures prepared in accordance with GAAP, please see Non-GAAP Financial Measures and Non-GAAP Financial Guidance in the tables above.

We understand that, although measures similar to these Non-GAAP financial measures are frequently used by investors and securities analysts in their evaluation of companies, they have limitations as analytical tools, and investors should not consider them in isolation or as a substitute for the most directly comparable GAAP financial measures or an analysis of our results of operations as reported under GAAP. To properly and prudently evaluate our business, we encourage investors to review our GAAP financial statements included above, and not to rely on any single financial measure to evaluate our business.

Adjusted EBITDA and Adjusted EBITDA Margin

We define adjusted EBITDA as net income attributable to common shareholders, including impact from redeemable non-controlling interests, before income tax (benefit) provision, other expenses net, depreciation, amortization of intangible assets, accretion of asset retirement obligations, contingent consideration expense, stock-based compensation expense, energy asset impairment, restructuring and other charges, gain or loss on sale of equity investment, and gain or loss upon deconsolidation of a variable interest entity. We believe adjusted EBITDA is useful to investors in evaluating our operating performance for the following reasons: adjusted EBITDA and similar Non-GAAP measures are widely used by investors to measure a company’s operating performance without regard to items that can vary substantially from company to company depending upon financing and accounting methods, book values of assets, capital structures and the methods by which assets were acquired; securities analysts often use adjusted EBITDA and similar Non-GAAP measures as supplemental measures to evaluate the overall operating performance of companies; and by comparing our adjusted EBITDA in different historical periods, investors can evaluate our operating results without the additional variations of depreciation and amortization expense, accretion of asset retirement obligations, contingent consideration expense, stock-based compensation expense, impact from redeemable non-controlling interests, restructuring and asset impairment charges. We define adjusted EBITDA margin as adjusted EBITDA stated as a percentage of revenue.

Our management uses adjusted EBITDA and adjusted EBITDA margin as measures of operating performance, because they do not include the impact of items that we do not consider indicative of our core operating performance; for planning purposes, including the preparation of our annual operating budget; to allocate resources to enhance the financial performance of the business; to evaluate the effectiveness of our business strategies; and in communications with the board of directors and investors concerning our financial performance.

Non-GAAP Net Income and EPS

We define Non-GAAP net income and earnings per share (EPS) to exclude certain discrete items that management does not consider representative of our ongoing operations, including energy asset impairment, restructuring and other charges, impact from redeemable non-controlling interest, gain or loss on sale of equity investment, and gain or loss upon deconsolidation of a variable interest entity. We consider Non-GAAP net income and Non-GAAP EPS to be important indicators of our operational strength and performance of our business because they eliminate the effects of events that are not part of the Company’s core operations.

Adjusted Cash from Operations

We define adjusted cash from operations as cash flows from operating activities plus proceeds from Federal ESPC projects. Cash received in payment of Federal ESPC projects is treated as a financing cash flow under GAAP due to the unusual financing structure for these projects. These cash flows, however, correspond to the revenue generated by these projects. Thus we believe that adjusting operating cash flow to include the cash generated by our Federal ESPC projects provides investors with a useful measure for evaluating the cash generating ability of our core operating business. Our management uses adjusted cash from operations as a measure of liquidity because it captures all sources of cash associated with our revenue generated by operations.

View source version on businesswire.com: https://www.businesswire.com/news/home/20230227005804/en/

Media Relations

Leila Dillon, 508.661.2264, [email protected]

Investor Relations

Eric Prouty, AdvisIRy Partners 212.750.5800,

[email protected]

Lynn Morgen, AdvisIRy Partners, 212.750.5800,

[email protected]

KEYWORDS: United States North America Massachusetts

INDUSTRY KEYWORDS: Commercial Building & Real Estate Construction & Property Other Energy Utilities Oil/Gas Alternative Energy Energy Nuclear Residential Building & Real Estate

MEDIA:

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Posted on February 27, 2023 4:21 pm
Sterling Reports Record Fourth Quarter and Full Year 2022 Results

Sterling Reports Record Fourth Quarter and Full Year 2022 Results

Provides 2023 Full Year Guidance

THE WOODLANDS, Texas–(BUSINESS WIRE)–
Sterling Infrastructure, Inc. (NasdaqGS: STRL) (“Sterling” or the “Company”) today announced financial results for the fourth quarter and full year 2022 and provided full year 2023 guidance.

Fourth Quarter 2022 Results (compared with prior year period)

(The financial information herein is from continuing operations unless otherwise noted)

Revenues of $448.6 million, an increase of 26%

Gross margin of 15.4%, an increase from 14.8%

Net Income was $20.2 million, or $0.66 per diluted share, an increase of 80% and 74%, respectively

EBITDA⁽¹⁾ of $49.9 million, an increase of 78%; Adjusted EBITDA⁽¹⁾ of $50.1 million, an increase of 58%

Cash flows from operations⁽²⁾ of $88.5 million and $219.1 million for the fourth quarter and year ended December 31, 2022, respectively

Cash and Cash Equivalents totaled $181.5 million at December 31, 2022

Backlog at December 31, 2022 was $1.41 billion, an increase of 7% over December 31, 2021

Combined backlog⁽³⁾ at December 31, 2022 was $1.69 billion, an increase of 25% over December 31, 2021

Continuing Operations–For the full year ended December 31, 2022, the Company reported net income of $96.7 million, or $3.16 per diluted share, versus $61.5 million, or $2.11 per diluted share, for 2021. Revenue increased by 25% over 2021. EBITDA⁽¹⁾ increased 51% to $208.7 million in 2022, versus $138.1 million in 2021. Adjusted EBITDA⁽¹⁾ increased 49% to $209.5 million in 2022, versus $140.9 million in 2021.

Discontinued Operations–For the full year ended December 31, 2022, the Company reported net income of $9.7 million, or $0.32 per diluted share, versus $1.2 million, or $0.04 per diluted share, for 2021. The increase was primarily driven by a pretax gain of $16.7 million, as the result of the disposition of the Company’s 50% ownership interest in its partnership with Myers & Sons Construction L.P.

For the full year ended December 31, 2022, the Company reported net income attributable to Sterling common stockholders⁽²⁾ of $106.5 million, or $3.48 per diluted share, versus $62.6 million, or $2.15 per diluted share, for 2021.

⁽¹⁾The Company defines EBITDA as GAAP net income from Continuing Operations, adjusted for depreciation and amortization, net interest expense and taxes. The Company defines Adjusted EBITDA as EBITDA excluding the impact of the net gain on extinguishment of debt and acquisition related costs. See the “Non-GAAP Measures” and “EBITDA Reconciliation” sections below for more information.

⁽²⁾ Includes both Continuing and Discontinued Operations.

⁽³⁾ Combined Backlog includes Unsigned Low-bid Awards of $275.0 million and $22.5 million at December 31, 2022 and December 31, 2021, respectively.

CEO Remarks and Outlook

“2022 marked another year of significant progress in transforming the company into a leading Infrastructure Service Provider. During a time of increased inflation and supply chain disruptions, our team’s ability to grow revenue 25% and improve margins 110 basis points over the prior year is truly amazing,” stated Joe Cutillo, Sterling’s Chief Executive Officer.

“Our E-Infrastructure Solutions segment delivered remarkable top-line growth of 93% compared to the prior year and remained our largest revenue, fastest-growing and highest-margin segment. E-Infrastructure organic growth was 31% while 62% was from the acquisition of Petillo. In our Building Solutions and Transportation Solutions segments we saw slower growth but significant operating income improvements. In Building Solutions, our operating income improved 13% and in Transportation Solutions, our operating income improved 34%,” continued Mr. Cutillo.

“We enter 2023 stronger than ever. With our record backlog and strong demand in E-Infrastructure and Transportation Solutions, we are confident in our ability to deliver another year of record earnings and value to our customers and investors,” Mr. Cutillo concluded.

Full Year 2023 Guidance:

Revenue of $1.9 billion to $2.0 billion

Net Income of $104 million to $110 million

EPS of $3.33 to $3.53

EBITDA⁽¹⁾ of $220 million to $235 million

Conference Call

Sterling’s management will hold a conference call to discuss these results and recent corporate developments on Tuesday, February 28, 2023 at 9:00 a.m. ET/8:00 a.m. CT. Interested parties may participate in the call by dialing (201) 493-6744 or (877) 445-9755. Please call in 10 minutes before the conference call is scheduled to begin and ask for the Sterling Infrastructure call. To coincide with the conference call, Sterling will post a slide presentation at www.strlco.com on the Events & Presentations section of the Investor Relations tab. Following management’s opening remarks, there will be a question and answer session.

To listen to a simultaneous webcast of the call, please go to the Company’s website at www.strlco.com at least 15 minutes early to download and install any necessary audio software. If you are unable to listen live, the conference call webcast will be archived on the Company’s website for 30 days.

About Sterling

Sterling operates through a variety of subsidiaries within three segments specializing in E-Infrastructure, Transportation and Building Solutions in the United States (the “U.S.”), primarily across the Southern, Northeastern and Mid-Atlantic U.S., the Rocky Mountain States, and Hawaii, as well as other areas with strategic construction opportunities. E-Infrastructure Solutions projects include advanced, large-scale site development systems and services for data centers, e-commerce distribution centers, warehousing, transportation, energy and more. Transportation Solutions includes infrastructure and rehabilitation projects for highways, roads, bridges, airports, ports, light rail and storm drainage systems. Building Solutions projects include residential and commercial concrete foundations for single-family and multi-family homes, parking structures, elevated slabs and other concrete work. From strategy to operations, we are committed to sustainability by operating responsibly to safeguard and improve society’s quality of life. Caring for our people and our communities, our customers and our investors – that is The Sterling Way.

Joe Cutillo, CEO, “We build and service the infrastructure that enables our economy to run, our people to move and our country to grow.”

⁽¹⁾The Company defines EBITDA as GAAP net income attributable to Sterling’s common stockholders, adjusted for depreciation and amortization, net interest expense and taxes. See the “Non-GAAP Measures” and “EBITDA Reconciliation” sections below for more information.

Important Information for Investors and Stockholders

Non-GAAP Measures

This press release contains “Non-GAAP” financial measures as defined under Regulation G of the amended U.S. Securities Exchange Act of 1934. The Company reports financial results in accordance with U.S. generally accepted accounting principles (“GAAP”), but the Company believes that certain Non-GAAP financial measures provide useful supplemental information to investors regarding the underlying business trends and performance of the Company’s ongoing operations and are useful for period-over-period comparisons of those operations.

Non-GAAP measures may include adjusted net income, adjusted EPS, EBITDA and adjusted EBITDA, in each case excluding the impacts of certain identified items. The excluded items represent items that the Company does not consider to be representative of its normal operations. The Company believes that these measures are useful for investors to review, because they provide a consistent measure of the underlying financial results of the Company’s ongoing business and, in the Company’s view, allow for a supplemental comparison against historical results and expectations for future performance. Furthermore, the Company uses each of these to measure the performance of the Company’s operations for budgeting and forecasting, as well as employee incentive compensation. However, Non-GAAP measures should not be considered as substitutes for net income, EPS, or other data prepared and reported in accordance with GAAP and should be viewed in addition to the Company’s reported results prepared in accordance with GAAP.

Reconciliations of Non-GAAP financial measures to the most comparable GAAP measures are provided in the tables included within this press release.

Cautionary Statement Regarding Forward-Looking Statements

This press release contains statements that are considered forward-looking statements within the meaning of the federal securities laws. These forward-looking statements are subject to a number of risks and uncertainties, many of which are beyond our control, which may include statements about: our business strategy; our financial strategy; our industry outlook; our guidance; and our plans, objectives, expectations, forecasts, outlook and intentions. All of these types of statements, other than statements of historical fact included in this press release, are forward-looking statements. In some cases, forward-looking statements can be identified by terminology such as “may,” “will,” “could,” “should,” “expect,” “plan,” “project,” “intend,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “pursue,” “target,” “continue,” the negative of such terms or other comparable terminology. The forward-looking statements contained in this press release are largely based on our expectations, which reflect estimates and assumptions made by our management. These estimates and assumptions reflect our best judgment based on currently known market conditions and other factors. Although we believe such estimates and assumptions to be reasonable, they are inherently uncertain and involve a number of risks and uncertainties that are beyond our control. In addition, management’s assumptions about future events may prove to be inaccurate. Management cautions all readers that the forward-looking statements contained in this press release are not guarantees of future performance, and we cannot assure any reader that such statements will be realized or the forward-looking events and circumstances will occur. Actual results may differ materially from those anticipated or implied in the forward-looking statements due to factors listed in the “Risk Factors” section in our filings with the U.S. Securities and Exchange Commission and elsewhere in those filings. Additional factors or risks that we currently deem immaterial, that are not presently known to us or that arise in the future could also cause our actual results to differ materially from our expected results. Given these uncertainties, investors are cautioned that many of the assumptions upon which our forward-looking statements are based are likely to change after the date the forward-looking statements are made. The forward-looking statements speak only as of the date made, and we undertake no obligation to publicly update or revise any forward-looking statements for any reason, whether as a result of new information, future events or developments, changed circumstances, or otherwise, notwithstanding any changes in our assumptions, changes in business plans, actual experience or other changes. These cautionary statements qualify all forward-looking statements attributable to us or persons acting on our behalf.

STERLING INFRASTRUCTURE, INC. & SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

(Unaudited)

Three Months Ended

December 31,

Twelve Months Ended

December 31,

2022

2021

2022

2021

Continuing Operations:

Revenues

$

448,607

$

355,375

$

1,769,436

$

1,414,374

Cost of revenues

(379,641

)

(302,863

)

(1,494,869

)

(1,210,842

)

Gross profit

68,966

52,512

274,567

203,532

General and administrative expense

(23,104

)

(22,971

)

(86,480

)

(69,153

)

Intangible asset amortization

(3,509

)

(2,866

)

(14,100

)

(11,464

)

Acquisition related costs

(265

)

(3,877

)

(827

)

(3,877

)

Other operating expense, net

(5,045

)

(2,740

)

(13,290

)

(12,027

)

Operating income

37,043

20,058

159,870

107,011

Interest income

684

12

885

45

Interest expense

(6,329

)

(3,675

)

(20,591

)

(19,311

)

Gain on extinguishment of debt, net

—

—

—

1,064

Income before income taxes

31,398

16,395

140,164

88,809

Income tax expense

(10,741

)

(4,552

)

(41,707

)

(24,874

)

Net income, including noncontrolling interests

20,657

11,843

98,457

63,935

Less: Net income attributable to noncontrolling interests

(424

)

(573

)

(1,740

)

(2,478

)

Net income from Continuing Operations

$

20,233

$

11,270

$

96,717

$

61,457

Discontinued Operations:

Pretax (loss) income

$

(1,561

)

$

(289

)

$

(4,848

)

$

1,214

Pretax gain on disposition

16,687

—

16,687

—

Income tax expense

(3,634

)

(73

)

(2,095

)

(26

)

Net income (loss) from Discontinued Operations

$

11,492

$

(362

)

$

9,744

$

1,188

Net income attributable to Sterling common stockholders

$

31,725

$

10,908

$

106,461

$

62,645

Net income per share from Continuing Operations:

Basic

$

0.67

$

0.39

$

3.20

$

2.15

Diluted

$

0.66

$

0.38

$

3.16

$

2.11

Net income (loss) per share from Discontinued Operations:

Basic

$

0.38

$

(0.01

)

$

0.32

$

0.04

Diluted

$

0.37

$

(0.01

)

$

0.32

$

0.04

Net income per share attributable to Sterling common stockholders:

Basic

$

1.05

$

0.38

$

3.53

$

2.19

Diluted

$

1.03

$

0.37

$

3.48

$

2.15

Weighted average common shares outstanding:

Basic

30,324

28,818

30,199

28,600

Diluted

30,739

29,756

30,564

29,101

STERLING INFRASTRUCTURE, INC. & SUBSIDIARIES

SEGMENT INFORMATION

(In thousands)

(Unaudited)

Three Months Ended December 31,

Twelve Months Ended December 31,

Revenues

2022

% of

Revenue

2021

% of

Revenue

2022

% of

Revenue

2021

% of

Revenue

E-Infrastructure Solutions

$

247,272

55%

$

127,183

36%

$

905,277

51%

$

468,784

33%

Transportation Solutions

126,545

28%

149,517

42%

542,550

31%

628,190

45%

Building Solutions

74,790

17%

78,675

22%

321,609

18%

317,400

22%

Total Revenues

$

448,607

$

355,375

$

1,769,436

$

1,414,374

Operating Income (Loss)

E-Infrastructure Solutions

$

29,811

12.1%

$

18,734

14.7%

$

121,453

13.4%

$

80,478

17.2%

Transportation Solutions

5,070

4.0%

4,238

2.8%

26,623

4.9%

19,888

3.2%

Building Solutions

8,260

11.0%

9,175

11.7%

36,693

11.4%

32,564

10.3%

Segment Operating Income

43,141

9.6%

32,147

9.0%

184,769

10.4%

132,930

9.4%

Corporate

(5,833

)

(8,212

)

(24,072

)

(22,042

)

Acquisition Related Costs

(265

)

(3,877

)

(827

)

(3,877

)

Total Continued Operating Income

$

37,043

8.3%

$

20,058

5.6%

$

159,870

9.0%

$

107,011

7.6%

STERLING INFRASTRUCTURE, INC. & SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except per share data)

(Unaudited)

December 31,

2022

December 31,

2021

Assets

Current assets:

Cash and cash equivalents

$

181,544

$

60,945

Accounts receivable

262,646

200,185

Contract assets

109,803

75,796

Receivables from and equity in construction joint ventures

14,122

9,839

Current assets of Discontinued Operations

—

71,886

Other current assets

29,139

16,040

Total current assets

597,254

434,691

Property and equipment, net

215,482

193,896

Operating lease right-of-use assets, net

59,415

19,473

Goodwill

262,692

258,290

Other intangibles, net

299,123

303,223

Non-current assets of Discontinued Operations

—

20,746

Other non-current assets, net

7,654

4,455

Total assets

$

1,441,620

$

1,234,774

Liabilities and Stockholders’ Equity

Current liabilities:

Accounts payable

$

121,887

$

112,746

Contract liabilities

239,297

118,672

Current maturities of long-term debt

32,610

23,373

Current portion of long-term lease obligations

19,715

6,557

Accrued compensation

24,136

20,415

Current liabilities of Discontinued Operations

—

51,914

Other current liabilities

8,966

18,083

Total current liabilities

446,611

351,760

Long-term debt

398,735

428,507

Long-term lease obligations

40,103

13,068

Members’ interest subject to mandatory redemption and undistributed earnings

21,597

19,322

Deferred tax liability, net

51,659

18,434

Long-term liabilities of Discontinued Operations

—

38,637

Other long-term liabilities

5,116

4,819

Total liabilities

963,821

874,547

Stockholders’ equity:

Common stock

306

298

Additional paid in capital

287,914

280,274

Retained earnings

186,379

79,918

Accumulated other comprehensive loss

—

(1,723

)

Total Sterling stockholders’ equity

474,599

358,767

Noncontrolling interests

3,200

1,460

Total stockholders’ equity

477,799

360,227

Total liabilities and stockholders’ equity

$

1,441,620

$

1,234,774

STERLING INFRASTRUCTURE, INC. & SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

Years Ended December 31,

2022

2021

Cash flows from operating activities:

Net income

$

108,201

$

65,123

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

Depreciation and amortization

52,066

34,201

Amortization of debt issuance costs and non-cash interest

2,136

2,242

Gain on disposal of property and equipment

(2,637

)

(1,396

)

Gain on debt extinguishment, net

(2,428

)

(2,032

)

Gain on disposition of Myers

(16,687

)

—

Deferred taxes

36,492

21,428

Stock-based compensation

12,726

11,771

Change in fair value of interest rate swap

(203

)

(32

)

Changes in operating assets and liabilities

29,450

27,627

Net cash provided by operating activities

219,116

158,932

Cash flows from investing activities:

Acquisitions, net of cash acquired

(18,004

)

(180,911

)

Disposition, net of cash disposed

(15,789

)

—

Capital expenditures

(60,909

)

(46,651

)

Proceeds from sale of property and equipment

4,947

4,113

Net cash used in investing activities

(89,755

)

(223,449

)

Cash flows from financing activities:

Cash received from credit facility

—

140,000

Repayments of debt

(23,373

)

(48,273

)

Distributions to noncontrolling interest owners

—

(2,477

)

Withholding taxes paid on net share settlement of equity awards

(9,416

)

(7,338

)

Debt issuance costs

—

(1,340

)

Other

—

(4

)

Net cash used in financing activities

(32,789

)

80,568

Net change in cash, cash equivalents, and restricted cash

96,572

16,051

Cash, cash equivalents and restricted cash at beginning of period

88,693

72,642

Cash, cash equivalents and restricted cash at end of period

185,265

88,693

Less: restricted cash (other current assets) – Continuing Operations

(3,721

)

(3,821

)

Less: cash, cash equivalents and restricted cash – Discontinued Operations

—

(23,927

)

Cash and cash equivalents at end of period – Continuing Operations

$

181,544

$

60,945

STERLING INFRASTRUCTURE, INC. & SUBSIDIARIES

HISTORICAL QUARTERLY SEGMENT INFORMATION

(In thousands)

(Unaudited)

The following tables present our 2022, 2021 and 2020 quarterly revenue and income from operations by segment adjusted to conform to our 2022 continuing operations presentation:

2022 Quarters Ended (unaudited)

Revenues

March 31

June 30

September 30

December 31

Total

E-Infrastructure Solutions

$

168,927

$

233,548

$

255,530

$

247,272

$

905,277

Transportation Solutions

116,141

142,640

157,224

126,545

542,550

Building Solutions

80,894

85,639

80,286

74,790

321,609

Revenues

$

365,962

$

461,827

$

493,040

$

448,607

$

1,769,436

Operating Income (Loss)

E-Infrastructure Solutions

$

21,285

$

32,824

$

37,533

$

29,811

$

121,453

Transportation Solutions

4,443

7,410

9,700

5,070

26,623

Building Solutions

9,358

9,751

9,324

8,260

36,693

Segment Operating Income

35,086

49,985

56,557

43,141

184,769

Corporate

(5,468

)

(5,766

)

(7,005

)

(5,833

)

(24,072

)

Acquisition related costs

(255

)

(230

)

(77

)

(265

)

(827

)

Operating Income

$

29,363

$

43,989

$

49,475

$

37,043

$

159,870

2021 Quarters Ended (unaudited)

Revenues

March 31

June 30

September 30

December 31

Total

E-Infrastructure Solutions

$

96,572

$

123,743

$

121,286

$

127,183

$

468,784

Transportation Solutions

119,097

160,017

199,559

149,517

628,190

Building Solutions

71,690

74,769

92,266

78,675

317,400

Revenues

$

287,359

$

358,529

$

413,111

$

355,375

$

1,414,374

Operating Income (Loss)

E-Infrastructure Solutions

$

17,812

$

24,714

$

19,218

$

18,734

$

80,478

Transportation Solutions

2,300

4,414

8,936

4,238

19,888

Building Solutions

7,361

6,790

9,238

9,175

32,564

Segment Operating Income

27,473

35,918

37,392

32,147

132,930

Corporate

(5,044

)

(3,404

)

(5,382

)

(8,212

)

(22,042

)

Acquisition related costs

—

—

—

(3,877

)

(3,877

)

Operating Income

$

22,429

$

32,514

$

32,010

$

20,058

$

107,011

2020 Quarters Ended (unaudited)

Revenues

March 31

June 30

September 30

December 31

Total

E-Infrastructure Solutions

$

78,574

$

103,310

$

114,961

$

100,408

$

397,253

Transportation Solutions

108,924

168,413

143,512

132,301

553,150

Building Solutions

64,828

73,951

67,419

70,137

276,335

Revenues

$

252,326

$

345,674

$

325,892

$

302,846

$

1,226,738

Operating Income (Loss)

E-Infrastructure Solutions

$

13,630

$

23,573

$

22,416

$

16,903

$

76,522

Transportation Solutions

(1,387

)

6,739

3,714

2,932

11,998

Building Solutions

7,438

8,950

7,687

6,366

30,441

Segment Operating Income

19,681

39,262

33,817

26,201

118,961

Corporate

(7,195

)

(6,589

)

(5,529

)

(6,007

)

(25,320

)

Acquisition related costs

(473

)

(139

)

(401

)

(13

)

(1,026

)

Operating Income

$

12,013

$

32,534

$

27,887

$

20,181

$

92,615

STERLING INFRASTRUCTURE, INC. & SUBSIDIARIES

EBITDA FROM CONTINUING OPERATIONS RECONCILIATION

(In thousands)

(Unaudited)

Three Months Ended

December 31,

Twelve Months Ended

December 31,

2022

2021

2022

2021

Net income from Continuing Operations

$

20,233

$

11,270

$

96,717

$

61,457

Depreciation and amortization

13,253

8,456

50,575

32,503

Interest expense, net of interest income

5,645

3,663

19,706

19,266

Income tax expense

10,741

4,552

41,707

24,874

EBITDA from Continuing Operations⁽¹⁾

49,872

27,941

208,705

138,100

Gain on extinguishment of debt, net

—

—

—

(1,064

)

Acquisition related costs

265

3,877

827

3,877

Adjusted EBITDA from Continuing Operations ⁽²⁾

$

50,137

$

31,818

$

209,532

$

140,913

⁽¹⁾The Company defines EBITDA as GAAP net income from Continuing Operations, adjusted for depreciation and amortization, net interest expense and taxes.

⁽²⁾Adjusted EBITDA excludes the impact of the net gain on extinguishment of debt and acquisition related costs.

STERLING INFRASTRUCTURE, INC. & SUBSIDIARIES

EBITDA GUIDANCE RECONCILIATION

(In millions)

(Unaudited)

Full Year 2023 Guidance

Low

High

Net income attributable to Sterling common stockholders

$

104

$

110

Depreciation and amortization

55

59

Interest expense, net of interest income

21

24

Income tax expense

40

42

EBITDA⁽¹⁾

$

220

$

235

⁽¹⁾The Company defines EBITDA as GAAP net income attributable to Sterling common stockholders, adjusted for depreciation and amortization, net interest expense, and taxes.

View source version on businesswire.com: https://www.businesswire.com/news/home/20230227005826/en/

Company:

Sterling Infrastructure, Inc.

Ron Ballschmiede, Chief Financial Officer

281-214-0777

Investor Relations:

The Equity Group Inc.

Jeremy Hellman, CFA

212-836-9626

KEYWORDS: Texas United States North America

INDUSTRY KEYWORDS: Architecture Commercial Building & Real Estate Construction & Property Engineering Logistics/Supply Chain Management Other Construction & Property Transport Manufacturing

MEDIA:

Logo

Posted on February 27, 2023 4:21 pm
Aprea Therapeutics Announces Closing of $5.5 Million Underwritten Public Offering of Common Stock

DOYLESTOWN, Pa., Feb. 27, 2023 (GLOBE NEWSWIRE) — Aprea Therapeutics, Inc. (Nasdaq: APRE) (“Aprea”, or the “Company”), a biopharmaceutical company focused on developing novel synthetic lethality-based cancer therapeutics targeting DNA damage response (DDR) pathways, today announced the closing of its previously announced underwritten public offering of 1,050,000 shares of its common stock at a public offering price of $5.25 per share. Gross proceeds from the offering before deducting underwriting discounts and commissions and offering expenses are approximately $5.5 million. In addition, Aprea has granted the underwriter a 30-day option to purchase up to an additional 157,500 shares of common stock.

The net proceeds received from the public offering will enable the Company to continue developing its clinical asset, ATRN-119, its pre-clinical asset ATRN-W1051 and for general corporate purposes.

Maxim Group LLC acted as sole book-running manager for the offering.

The public offering was made pursuant to an effective shelf registration statement on Form S-3, as amended (File No. 333-250041), previously filed with the U.S. Securities and Exchange Commission (SEC) on November 12, 2020 and declared effective on November 30, 2020. The final terms of the offering are disclosed in the final prospectus supplement which has been filed with the SEC. Copies of the final prospectus supplement and accompanying prospectus relating to the public offering may also be obtained by contacting Maxim Group LLC, at 300 Park Avenue, 16th Floor, New York, NY 10022, Attention: Prospectus Department, or by telephone at (212) 895-3745 or by email at [email protected].

This press release does not constitute an offer to sell or the solicitation of an offer to buy these securities, nor shall there be any sale of these securities in any state or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such state or other jurisdiction.

About Aprea Therapeutics

Aprea Therapeutics, Inc. is a biopharmaceutical company headquartered in Doylestown, Pennsylvania, focused on developing and commercializing novel synthetic lethality-based cancer therapeutics targeting a critical pathway and some of the most central targets in DDR and cancer progression. The Company’s lead program is ATRN-119, a clinical-stage small molecule ATR inhibitor being developed for solid tumor indications. The Company’s WEE1 inhibitor is being advanced to IND submission.

Forward Looking Statement

Certain information contained in this press release includes “forward-looking statements,” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, related to the anticipated offering. We may, in some cases use terms such as “future,” “predicts,” “believes,” “potential,” “continue,” “anticipates,” “estimates,” “expects,” “plans,” “intends,” “targeting,” “confidence,” “may,” “could,” “might,” “likely,” “will,” “should” or other words that convey uncertainty of the future events or outcomes to identify these forward-looking statements. Our forward-looking statements are based on current beliefs and expectations of our management team that involve risks, potential changes in circumstances, assumptions, and uncertainties. Any or all of the forward-looking statements may turn out to be wrong or be affected by inaccurate assumptions we might make or by known or unknown risks and uncertainties. These forward-looking statements are subject to risks and uncertainties including risks related to our intended use of proceeds and the other risks set forth in our filings with the U.S. Securities and Exchange Commission. For all these reasons, actual results and developments could be materially different from those expressed in or implied by our forward-looking statements. You are cautioned not to place undue reliance on these forward-looking statements, which are made only as of the date of this press release. We undertake no obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances.

Investors and Media:

[email protected]
212-600-1902

Posted on February 27, 2023 4:20 pm
Varonis to Present at March Investor Conferences

NEW YORK, Feb. 27, 2023 (GLOBE NEWSWIRE) — Varonis Systems, Inc. (Nasdaq: VRNS), a pioneer in data security and analytics, announced its participation at the following upcoming conferences:

The JMP Securities Technology Conference, March 6 – 7, in San Francisco. The presentation is scheduled for March 7 at 11:30 a.m. PT.

The Morgan Stanley Technology, Media & Telecom Conference, March 6 – 9, in San Francisco. The presentation is scheduled for March 8 at 9:10 a.m. PT.

The audio presentations will be webcast live and available by visiting the “Investor Relations” section of Varonis’ website at ir.varonis.com. The webcasts will be archived on the website for a limited time following the conferences.

Additional Resources

For more information on Varonis’ solution portfolio, please visit www.varonis.com.

Visit our blog, and join the conversation on Twitter, LinkedIn, and YouTube.

Watch and subscribe to SecurityFWD, Varonis’ YouTube show covering the latest infosec tips, tricks, and tools.

About Varonis

Varonis is a pioneer in data security and analytics, fighting a different battle than conventional cybersecurity companies. Varonis focuses on protecting enterprise data: sensitive files and emails; confidential customer, patient, and employee data; financial records; strategic and product plans; and other intellectual property. The Varonis Data Security Platform detects cyber threats from both internal and external actors by analyzing data, account activity, and user behavior; prevents and limits disaster by locking down sensitive and stale data; and efficiently sustains a secure state with automation. Varonis products address additional important use cases including data protection, data governance, Zero Trust, compliance, data privacy, classification, and threat detection and response. Varonis started operations in 2005 and has customers spanning leading firms in the financial services, public, healthcare, industrial, insurance, technology, consumer and retail, energy and utilities, construction and engineering, and education sectors.

Investor Relations Contact:

Tim Perz
Varonis Systems, Inc.
646-640-2112
[email protected]

News Media Contact:
Rachel Hunt
Varonis Systems, Inc.
877-292-8767 (ext. 1598)
[email protected]

Posted on February 27, 2023 4:20 pm
Adverum Biotechnologies to Present at Upcoming Investor Conferences

REDWOOD CITY, Calif., Feb. 27, 2023 (GLOBE NEWSWIRE) — Adverum Biotechnologies, Inc. (Nasdaq: ADVM), a clinical-stage company that aims to establish gene therapy as a new standard of care for highly prevalent ocular diseases, today announced that Laurent Fischer, M.D., president and chief executive officer of Adverum Biotechnologies, will present at the following upcoming investor conferences:

Cowen 43^rd Annual Health Care Conference on Wednesday, March 8, 2023 at 12:50 p.m. ET

Oppenheimer 33^rd Virtual Annual Healthcare Conference on Wednesday, March 15, 2023 at 2:00 p.m. ET

The on-demand webcast corporate presentation may be accessed under Events and Presentations in the Investors section of Adverum’s website. A replay of the webcast will be available on the website for 90 days following the presentation.

About Adverum Biotechnologies

Adverum Biotechnologies (NASDAQ: ADVM) is a clinical-stage company that aims to establish gene therapy as a new standard of care for highly prevalent ocular diseases with the aspiration of developing functional cures to restore vision and prevent blindness. Leveraging the research capabilities of its proprietary, intravitreal (IVT) platform, Adverum is developing durable, single-administration therapies, designed to be delivered in physicians’ offices, to eliminate the need for frequent ocular injections to treat these diseases. Adverum is evaluating its novel gene therapy candidate, ixoberogene soroparvovec (Ixo-vec, formerly referred to as ADVM-022), as a one-time, IVT injection for patients with neovascular or wet age-related macular degeneration. By overcoming the challenges associated with current treatment paradigms for debilitating ocular diseases, Adverum aspires to transform the standard of care, preserve vision, and create a profound societal impact around the globe. For more information, please visit www.adverum.com.

Corporate, Investor and Media Inquiries

Anand Reddi
Vice President, Head of Corporate Strategy, External Affairs and Engagement
Adverum Biotechnologies, Inc.
T: 650-649-1358
E: [email protected]

Posted on February 27, 2023 4:19 pm
ForgeRock Announces Strong Fourth Quarter and Full Year 2022 Financial Results

ForgeRock Announces Strong Fourth Quarter and Full Year 2022 Financial Results

ARR was $229.6 million for Q4 2022, growing 25% year-over-year

Total revenue was $217.5 million in 2022, growing 23% year-over-year

Subscription SaaS, Support & Maintenance revenue was $119.0 million in 2022, growing 39% year-over-year

SAN FRANCISCO–(BUSINESS WIRE)–
ForgeRock, Inc. (NYSE: FORG), a global leader in digital identity, today announced financial results for its fourth quarter and fiscal year ended December 31, 2022.

“We ended 2022 with $230 million of ARR, representing another solid year of growth for ForgeRock,” said Fran Rosch, CEO of ForgeRock. “Our net retention rate increased in Q4 to 113% as more of our customers migrated to the ForgeRock Identity Cloud, our SaaS offering, and also expanded with us through more identities, use cases, and product modules. In 2022, we continued to innovate, introducing new products as well as infusing AI across our entire enterprise-grade platform to further strengthen our market position in the digital identity space. We are excited about our new product capabilities like Autonomous Access, as well as our roadmap ahead for 2023.”

“Our revenue grew 33% in Q4 2022 and we saw our gross margin and non-GAAP gross margin expand to 82% and 83%, respectively, in 2022,” said John Fernandez, CFO of ForgeRock. “Our Subscription SaaS, Support & Maintenance revenue represented 55% of total revenue in 2022 compared to 48% in 2021, which was driven by the robust growth in the ForgeRock Identity Cloud, our SaaS offering. Our GAAP operating margin was (25)% in Q4 2022 and includes the impact of acquisition-related costs, and (22)% in Q4 2021. Our non-GAAP operating margin in Q4 2022 of (2)% was a significant improvement over the (13)% we experienced in Q4 2021 and our business continues to be on track to achieve non-GAAP operating margin profitability sometime in the back half of 2023.”

Fourth Quarter 2022 Financial Highlights:

ARR: Annualized Recurring Revenue was $229.6 million, an increase of 25% year-over-year.

Revenue: Total revenue was $63.5 million, an increase of 33% year-over-year.

Operating Loss: GAAP operating loss was $15.9 million, or (25)% of total revenue, compared to $10.4 million, or (22)% of total revenue, in the fourth quarter of 2021. Non-GAAP operating loss was $1.4 million, or (2)% of total revenue, compared to $6.1 million, or (13)% of total revenue, in the fourth quarter of 2021.

Net Loss: GAAP net loss was $16.5 million, compared to $12.4 million in the fourth quarter of 2021. GAAP net loss per share was $0.19, compared to $0.15 in the fourth quarter of 2021. Non-GAAP net loss was $2.0 million, compared to $8.1 million in the fourth quarter of 2021. Non-GAAP net loss per share was $0.02, compared to $0.10 in the fourth quarter of 2021.

Cash Flow: Net cash used in operations was $14.0 million, compared to $5.4 million in the fourth quarter of 2021. Free cash flow was $(14.1) million, or (22)% of total revenue, compared to $(6.1) million, or (13)% of total revenue, in the fourth quarter of 2021.

Cash, cash equivalents and short-term investments were $336.1 million as of December 31, 2022.

Full Year 2022 Financial Highlights:

Revenue: Total revenue was $217.5 million, an increase of 23% year-over-year.

Operating Loss: GAAP operating loss was $66.6 million, or (31)% of total revenue, compared to $28.4 million, or (16)% of total revenue, in 2021. Non-GAAP operating loss was $27.6 million, or (13)% of total revenue, compared to $17.8 million or (10)% of total revenue in 2021.

Net Loss: GAAP net loss was $66.3 million compared to $47.8 million in 2021. GAAP net loss per share was $0.78 compared to $1.14 in 2021. Non-GAAP net loss was $27.0 million, compared to $37.0 million in 2021. Non-GAAP net loss per share was $0.32, compared to $0.89 in 2021.

Cash Flow: Net cash used in operations was $45.0 million, compared to $36.8 million in 2021. Free cash flow was $(46.6) million, or (21)% of total revenue, compared to $(37.9) million, or (21)% of total revenue in 2021.

ForgeRock uses certain non-GAAP financial measures, which are described further below and reconciled to the most comparable GAAP financial measure after the presentation of our GAAP financial statements.

Transaction with Thoma Bravo

As previously reported, the U.S. Department of Justice (the “DOJ”) has issued a Second Request in connection with its review of the proposed acquisition of ForgeRock by Thoma Bravo pursuant to the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (the “HSR Act”). Recently, ForgeRock and entities affiliated with Thoma Bravo entered into an agreement (the “Timing Agreement”) with the DOJ in connection with the proposed acquisition and the Second Request. Under the Timing Agreement, ForgeRock and Thoma Bravo have agreed that they will certify compliance with the Second Request no earlier than May 1, 2023, and will not consummate the proposed acquisition less than 75 days after compliance with the Second Request. The Timing Agreement does not prevent ForgeRock and Thoma Bravo from consummating the proposed acquisition sooner if the DOJ closes its investigation of the proposed acquisition before that date. The expiration or termination of the waiting period applicable to the proposed acquisition pursuant to the HSR Act (and the absence of any agreement with any governmental authority not to consummate the proposed acquisition) is the only remaining approval or regulatory condition required to consummate the closing of the proposed acquisition.

Due to the Company’s pending acquisition by Thoma Bravo that was announced on October 11, 2022, there will not be a conference call or live webcast to discuss these financial results. In addition, the Company has suspended its financial guidance as a result of the pending transaction.

Supplemental Financial and Other Information:

Supplemental financial and other information can be accessed through ForgeRock’s investor relations website at investors.forgerock.com.

Non-GAAP Financial Measures and Key Metrics:

Besides financial results prepared in accordance with U.S. generally accepted accounting principles (“GAAP”), ForgeRock believes that evaluating its ongoing operating results may be difficult if limited to reviewing only GAAP financial measures. Accordingly, ForgeRock uses non-GAAP financial measures to evaluate its operations. We use non-GAAP financial measures to understand and evaluate our core operating performance and trends, to prepare our annual budget, to monitor and assess our liquidity, and to develop short-term and long-term operating plans. We believe that the non-GAAP financial measures we review are each a useful measure to us and to our investors because they provide consistency and comparability with our past performance and between periods, as these metrics generally eliminate the effects of the variability of certain charges and expenses that may not reflect our overall operating performance and liquidity. We believe that non-GAAP financial measures, when taken collectively with GAAP financial information, can be helpful to us and to investors because it provides consistency and comparability with past performance and assists in comparisons with other companies, some of which use similar non-GAAP financial information to supplement their GAAP results.

ForgeRock presents non-GAAP gross profit, non-GAAP gross margin, non-GAAP research and development, non-GAAP sales and marketing, non-GAAP general and administrative, non-GAAP operating loss, non-GAAP operating margin and non-GAAP net loss per share, all of which exclude acquisition-related costs, stock-based compensation expense, and certain of which exclude the tax effect on the provision for (benefit from) income taxes related to such excluded items. ForgeRock excludes acquisition-related costs because they are unrelated to our current operations and are neither comparable to the prior period nor indicative of future results. We also exclude stock-based compensation expense as it can vary significantly from period to period based on share price and the timing, size and nature of equity awards. As such, ForgeRock and many investors and analysts exclude stock-based compensation expense to better evaluate its operating performance and cash spending levels relative to its industry sector and competitors.

ForgeRock presents adjusted EBITDA, which is also a non-GAAP financial measure. We define adjusted EBITDA as GAAP operating loss, adjusted for depreciation, acquisition-related costs and stock-based compensation expense. ForgeRock excludes certain items that it believes are not good indicators of ForgeRock’s current or future operating performance. These items are depreciation, acquisition-related costs and stock-based compensation. ForgeRock excludes depreciation given its standard exclusion in EBITDA and adjusted EBITDA results. In addition, the frequency and amount of such charges can vary significantly based on the size and timing of the transactions.

ForgeRock also presents free cash flow, which is a non-GAAP financial measure. We define free cash flow as net cash used in operating activities less cash used for purchases of property and equipment. ForgeRock provides free cash flow as it is a commonly used non-GAAP financial measure to indicate the amount of cash needed to fund its operations and capital expenditures.

The non-GAAP financial information is presented for supplemental informational purposes only and should not be considered a substitute for financial information presented in accordance with GAAP and may be different from similarly-titled non-GAAP measures used by other companies. The principal limitation of these non-GAAP financial measures is that they exclude expenses that are required by GAAP to be recorded in our consolidated financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgment by our management about which expenses are excluded or included in determining these non-GAAP financial measures. A reconciliation is provided below for each non-GAAP financial measure to the most directly comparable financial measure stated in accordance with GAAP. Investors are encouraged to review the related GAAP financial measures and the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures.

ForgeRock also uses the key metric Annualized Recurring Revenue (“ARR”), to evaluate its operations. We believe that ARR is a key metric because it is driven by our ability to acquire new customers and to maintain and expand our relationship with existing customers. We define ARR as the annualized value of all contractual subscription agreements as of the end of the period. To the extent that we are negotiating a renewal with a customer after the expiration of the subscription, we continue to include that revenue in ARR if we are actively in discussion with such an organization for a new subscription or renewal, or until such organization notifies us that it is not renewing its subscription. We perform this calculation on an individual customer basis by dividing the total dollar amount of the customer’s contract by the total contract term stated in months and multiplying this amount by 12 to annualize. Calculated ARR for each individual customer is then aggregated to arrive at total ARR.

ARR does not have a standardized meaning and therefore may not be comparable to similarly titled measures presented by other companies. ARR should be viewed independently of revenue, deferred revenue and remaining performance obligations computed and/or disclosed in accordance with GAAP and is not intended to be combined with or to replace any of those items. Specifically, ARR, as calculated under the definition herein, has the effect of normalizing the impact of revenue recognition for term-based subscription license agreements. ARR is calculated based upon annualized contract value and not actual GAAP revenue. Under ASC 606, for term-based subscription license agreements, we recognize approximately half of the total contract value upfront as license revenue, with the remainder attributable to maintenance and support that is recognized ratably over the license term. Annualizing actual GAAP revenue for any particular period could result in a meaningful difference from our ARR calculation, particularly when we are experiencing increases or decreases in the mix of multi-year term licenses. ARR is not a forecast and the active contracts at the date used in calculating ARR may or may not be extended by our customers.

Forward-Looking Statements:

This press release contains forward-looking statements within the meaning of the federal securities laws. Forward-looking statements generally relate to future events or ForgeRock’s future financial or operating performance. In some cases, you can identify forward-looking statements because they contain words such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “going to,” “could,” “intends,” “target,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential,” “continue” or the negative of these words or other similar terms or expressions that concern ForgeRock’s expectations, strategy, priorities, plans or intentions. Forward-looking statements in this release include, but are not limited to the quotations of management, statements regarding the proposed acquisition by entities affiliated with Thoma Bravo, our strategy, products and financial condition. Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circumstances that are beyond our control. Our actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including but not limited to the pendency of the proposed acquisition by entities affiliated with Thoma Bravo or the failure to complete such transaction, our ability to attract new customers and retain and sell additional functionality and services to our existing customers, our ability to sustain and manage our growth, our ability to successfully add new features and functionality to our platform, our ability to compete effectively in an increasingly competitive market, and general market, political, economic, and business conditions, and other risks detailed in our filings with the Securities and Exchange Commission (“SEC”), including our Quarterly Report on Form 10-Q filed with the SEC on November 10, 2022 and in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, which will be filed with the SEC.

Past performance is not necessarily indicative of future results. The forward-looking statements included in this press release represent our views as of the date of this press release. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to the date of this press release. We anticipate that subsequent events and developments could cause our views to change. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

About ForgeRock

ForgeRock®, a global leader in digital identity, delivers modern identity and access management solutions for consumers, employees and things to simply and safely access the connected world. Using ForgeRock, more than 1,300 organizations around the world orchestrate, manage, and secure the complete lifecycle of identities from dynamic access controls, governance, APIs, and storing authoritative data – consumable in cloud or hybrid environments.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

(Unaudited)

Three months ended

December 31,

Year ended

December 31,

2022

2021

2022

2021

Revenue:

Subscription term licenses

$

28,203

$

21,662

$

87,292

$

84,611

Subscription SaaS, support & maintenance

31,974

23,891

119,003

85,434

Perpetual licenses

318

810

515

1,695

Total subscriptions and perpetual licenses

60,495

46,363

206,810

171,740

Professional services

3,028

1,541

10,702

5,193

Total revenue

63,523

47,904

217,512

176,933

Cost of revenue:

Subscriptions and perpetual licenses

8,865

5,223

27,768

17,535

Professional services

3,080

4,735

11,772

15,393

Total cost of revenue⁽¹⁾

11,945

9,958

39,540

32,928

Gross profit

51,578

37,946

177,972

144,005

Operating expenses:

Research and development⁽¹⁾

16,138

12,283

61,837

43,497

Sales and marketing⁽¹⁾

32,793

23,825

118,794

88,620

General and administrative⁽¹⁾

14,694

12,237

57,724

40,329

Acquisition-related costs

3,809

—

6,173

—

Total operating expenses

67,434

48,345

244,528

172,446

Operating loss

(15,856

)

(10,399

)

(66,556

)

(28,441

)

Foreign currency gain (loss)

(1,066

)

(816

)

2,568

(3,819

)

Fair value adjustment on warrants and preferred stock tranche option

—

—

—

(10,068

)

Interest expense

(903

)

(945

)

(3,577

)

(4,516

)

Other income (expense), net

1,906

24

2,971

(40

)

Interest and other expense, net

(63

)

(1,738

)

1,962

(18,443

)

Loss before income taxes

(15,919

)

(12,138

)

(64,594

)

(46,884

)

Provision for income taxes

575

223

1,678

884

Net loss

$

(16,494

)

$

(12,361

)

$

(66,272

)

$

(47,768

)

Net loss per share attributable to common stockholders:

Basic and diluted

$

(0.19

)

$

(0.15

)

$

(0.78

)

$

(1.14

)

Weighted-average shares used in computing net loss per share attributable to common stockholders:

Basic and diluted

86,124

81,979

84,885

41,742

(1) Includes stock-based compensation as follows (in thousands):

Three months ended

December 31,

Year ended

December 31,

2022

2021

2022

2021

Cost of revenue

$

1,062

$

424

$

2,852

$

617

Research and development

2,053

867

6,738

1,924

Sales and marketing

4,186

1,449

12,044

3,495

General and administrative

3,303

1,530

11,126

4,630

Total stock-based compensation expense

$

10,604

$

4,270

$

32,760

$

10,666

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

(Unaudited)

December 31,

2022

2021

Assets

Cash and cash equivalents

$

128,803

$

128,381

Short-term investments

207,248

241,411

Accounts receivable, net of allowance for credit losses of $444 and $34, respectively

71,439

55,999

Contract assets

25,117

19,670

Deferred commissions

9,936

8,457

Prepaid expenses and other assets

14,810

9,787

Total current assets

457,353

463,705

Deferred commissions

20,379

15,601

Property and equipment, net

2,850

2,463

Operating lease right-of-use assets

10,190

12,626

Contract and other assets

3,408

2,783

Total assets

$

494,180

$

497,178

Liabilities and stockholders’ equity

Accounts payable

$

4,587

$

2,039

Accrued expenses

34,311

27,375

Current portion of operating lease liability

1,902

1,820

Deferred revenue

82,036

67,222

Other liabilities

2,927

2,258

Total current liabilities

125,763

100,714

Long-term debt

39,611

39,483

Long-term operating lease liability

9,207

11,037

Deferred revenue

1,283

8,172

Other liabilities

2,150

1,646

Total liabilities

178,014

161,052

Stockholders’ equity

Common stock

87

83

Additional paid-in capital

641,983

593,196

Accumulated other comprehensive income

4,193

6,672

Accumulated deficit

(330,097

)

(263,825

)

Total stockholders’ equity

316,166

336,126

Total liabilities and stockholders’ equity

$

494,180

$

497,178

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

Year ended December 31,

2022

2021

Operating activities:

Net loss

$

(66,272

)

$

(47,768

)

Adjustments to reconcile net loss to net cash used in operating activities:

Depreciation

1,064

1,061

Noncash operating lease expense

2,449

1,931

Stock-based compensation expense

32,760

10,666

Amortization of deferred commissions

15,235

13,964

Foreign currency remeasurement loss (gain)

(2,711

)

3,032

Change in fair value of redeemable convertible preferred stock warrant liability

—

5,871

Change in fair value of preferred stock tranche option liability

—

4,157

Amortization of premium / discount on short-term investments

1,156

1,330

Other

(169

)

266

Changes in operating assets and liabilities:

Deferred commissions

(21,487

)

(23,273

)

Accounts receivable

(13,371

)

(20,669

)

Contract and other non-current assets

(5,104

)

(10,505

)

Prepaid expenses and other current assets

(2,323

)

(6,025

)

Operating lease liabilities

(1,733

)

(2,377

)

Accounts payable

2,514

701

Accrued expenses and other liabilities

7,422

10,863

Deferred revenue

5,564

19,992

Net cash used in operating activities

(45,006

)

(36,783

)

Investing activities:

Purchases of property and equipment

(1,619

)

(1,113

)

Purchases of short-term investments

(166,363

)

(277,126

)

Maturities of short-term investments

158,615

31,860

Sales of short-term investments

39,379

1,933

Net cash provided by (used in) investing activities

30,012

(244,446

)

Financing activities:

Proceeds from initial public offering, net of underwriting discounts and commissions

—

295,694

Payment of stock offering costs

(145

)

(6,038

)

Proceeds from exercises of employee stock options

12,237

4,902

Proceeds from issuance of common stock under employee stock purchase plan

6,961

—

Proceeds from issuance of redeemable convertible preferred stock

—

19,951

Employee payroll taxes paid for net shares settlement of restricted stock units

(3,154

)

(3,877

)

Principal repayments on debt

—

(120

)

Net cash provided by financing activities

15,899

310,512

Effect of exchange rates on cash and cash equivalents and restricted cash

1,982

(888

)

Net increase in cash, cash equivalents and restricted cash

2,887

28,395

Cash, cash equivalents and restricted cash, beginning of year

128,437

100,042

Cash, cash equivalents and restricted cash, end of period

$

131,324

$

128,437

Supplementary cash flow disclosure:

Short-term investments, end of period

$

207,248

$

241,411

Cash paid for interest

3,244

3,629

Cash paid for income taxes

1,245

769

Deferred offering costs accrued but not yet paid

—

(145

)

Conversion of redeemable convertible preferred stock to common stock

—

263,178

Reconciliation of cash and cash equivalents and restricted cash:

Cash and cash equivalents

$

128,803

$

128,381

Restricted cash included in prepaids and other current assets

2,521

56

Total cash and cash equivalents and restricted cash

$

131,324

$

128,437

FORGEROCK, INC.

NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS TO GAAP RESULTS

Non-GAAP Gross Profit and Non-GAAP Gross Margin

Gross profit is defined as GAAP revenue less cost of revenue and gross margin is GAAP gross profit as a percentage of total revenue. We define non-GAAP gross profit and non-GAAP gross margin as GAAP gross profit and GAAP gross margin adjusted to exclude stock-based compensation expense, as presented below (in thousands, except percentages):

Three Months Ended December 31,

Year Ended December 31,

2022

2021

2022

2021

Gross Profit

$

51,578

$

37,946

$

177,972

$

144,005

Add: stock-based compensation included in cost of revenue

1,062

424

2,852

617

Non-GAAP gross profit

$

52,640

$

38,370

$

180,824

$

144,622

Gross margin

81

%

79

%

82

%

81

%

Non-GAAP gross margin

83

%

80

%

83

%

82

%

Non-GAAP Research and Development

We define non-GAAP research and development as GAAP research and development adjusted to exclude stock-based compensation expense, as presented below (in thousands):

Three Months Ended December 31,

Year Ended December 31,

2022

2021

2022

2021

Research and development

$

16,138

$

12,283

$

61,837

$

43,497

Less: Stock-based compensation

2,053

867

6,738

1,924

Non-GAAP research and development

$

14,085

$

11,416

$

55,099

$

41,573

Non-GAAP Sales and Marketing

We define non-GAAP sales and marketing as GAAP sales and marketing adjusted to exclude stock-based compensation expense, as presented below (in thousands):

Three Months Ended December 31,

Year Ended December 31,

2022

2021

2022

2021

Sales and marketing

$

32,793

$

23,825

$

118,794

$

88,620

Less: Stock-based compensation

4,186

1,449

12,044

3,495

Non-GAAP sales and marketing

$

28,607

$

22,376

$

106,750

$

85,125

Non-GAAP General and Administrative

We define non-GAAP general and administrative as GAAP general and administrative adjusted to exclude stock-based compensation expense, as presented below (in thousands):

Three Months Ended December 31,

Year Ended December 31,

2022

2021

2022

2021

General and administrative

$

14,694

$

12,237

$

57,724

$

40,329

Less: Stock-based compensation

3,303

1,530

11,126

4,630

Non-GAAP general and administrative

$

11,391

$

10,707

$

46,598

$

35,699

Non-GAAP Operating Loss and Non-GAAP Operating Margin

We define non-GAAP operating loss and non-GAAP operating margin as GAAP operating loss and GAAP operating margin adjusted to exclude stock-based compensation expense and acquisition-related costs, as presented below (in thousands, except percentages):

Three Months Ended December 31,

Year Ended December 31,

2022

2021

2022

2021

Operating loss

$

(15,856

)

$

(10,399

)

$

(66,556

)

$

(28,441

)

Add: Stock-based compensation

10,604

4,270

32,760

10,666

Add: Acquisition-related costs

3,809

—

6,173

—

Non-GAAP operating loss

$

(1,443

)

$

(6,129

)

$

(27,623

)

$

(17,775

)

Operating margin

(25

) %

(22

) %

(31

) %

(16

) %

Non-GAAP operating margin

(2

) %

(13

) %

(13

) %

(10

) %

Adjusted EBITDA

We define adjusted EBITDA as operating loss adjusted to exclude depreciation, stock-based compensation expense and acquisition-related costs, as presented below (in thousands):

Three Months Ended December 31,

Year Ended December 31,

2022

2021

2022

2021

Operating loss

$

(15,856

)

$

(10,399

)

$

(66,556

)

$

(28,441

)

Add: Depreciation

252

266

1,064

1,061

Add: Stock-based compensation

10,604

4,270

32,760

10,666

Add: Acquisition-related costs

3,809

—

6,173

—

Adjusted EBITDA

$

(1,191

)

$

(5,863

)

$

(26,559

)

$

(16,714

)

Non-GAAP Net Income (Loss) and Non-GAAP Net Income (Loss) per Share, Basic and Diluted

We define non-GAAP net loss as GAAP net loss adjusted to exclude stock-based compensation expense and acquisition-related costs, including the tax effect of stock-based compensation expense on the provision for (benefit from) income taxes as presented below (in thousands, except per share amounts):

We define non-GAAP net loss per share, basic, as non-GAAP net loss divided by GAAP weighted-average shares used to compute net loss per share, basic.

We define non-GAAP net loss per share, diluted, as non-GAAP net loss divided by GAAP weighted average shares used to compute net loss per share, basic, adjusted for (i) the dilutive effect of employee equity awards, excluding the impact of unrecognized stock-based compensation expense and (ii) warrants; unless these adjustments are anti-dilutive.

Three Months Ended December 31,

Year Ended December 31,

2022

2021

2022

2021

Net loss

$

(16,494

)

$

(12,361

)

$

(66,272

)

$

(47,768

)

Add: Stock-based compensation

10,604

4,270

32,760

10,666

Add: Acquisition-related costs

3,809

—

6,173

—

Tax effect on the provision for income taxes

97

40

295

76

Non-GAAP net loss

$

(1,984

)

$

(8,051

)

$

(27,044

)

$

(37,026

)

Non-GAAP net loss per share, basic and diluted

$

(0.02

)

$

(0.10

)

$

(0.32

)

$

(0.89

)

Free Cash Flow

We define free cash flow as net cash provided by (used in) operating activities less cash used for purchases of property and equipment as presented below (in thousands):

Three Months Ended December 31,

Year Ended December 31,

2022

2021

2022

2021

Net cash used in operating activities

$

(14,002

)

$

(5,427

)

$

(45,006

)

$

(36,783

)

Purchases of property and equipment

(145

)

(654

)

(1,619

)

(1,113

)

Free cash flow

$

(14,147

)

$

(6,081

)

$

(46,625

)

$

(37,896

)

View source version on businesswire.com: https://www.businesswire.com/news/home/20230227005713/en/

Investor Relations:

[email protected]

Media Contacts:

Kristen Batch, ForgeRock

[email protected]

KEYWORDS: California United States North America

INDUSTRY KEYWORDS: Internet Security Data Management Technology Software

MEDIA:

Posted on February 27, 2023 4:19 pm
Ameresco Announces Acquisition of Enerqos to Expand Presence in Europe

Ameresco Announces Acquisition of Enerqos to Expand Presence in Europe

Cleantech Integrator Signs Agreement to Acquire Milan-based Energy Efficiency and Renewable Energy Company

FRAMINGHAM, Mass. & MILAN–(BUSINESS WIRE)–Ameresco, Inc., (NYSE: AMRC), a leading cleantech integrator and renewable energy asset developer, owner and operator, today announced the signing of a definitive purchase and sale agreement to acquire ENERQOS Energy Solutions S.r.l., a renewable energy and energy efficiency company headquartered in Milan. With this acquisition, Ameresco will be able to expand its portfolio of clean energy projects and solutions throughout Italy.

Enerqos has been operating for more than 15 years with the mission of taking care of the environment by offering a competitive advantage to Italian companies through energy efficiency and renewable energy solutions. They have a large portfolio of cost saving and carbon reduction projects across multiple markets in Italy, including healthcare, real estate, retail and residential.

Ameresco already offers clean energy solutions in several European countries, including the United Kingdom, Ireland and Greece. By applying Ameresco’s well-established business model and ENERQOS’ regional reach, expertise and scale, Ameresco’s acquisition is well-positioned to build a high-growth clean energy solutions business and pipeline across Europe.

“We are extremely pleased to be part of this acquisition combining two companies across the globe into a singular mission for customers seeking to install resilient and renewable energy infrastructure,” said Lars Meisinger from Aquila Capital, financial advisor to the seller. “It was a great pleasure to work alongside the Ameresco team on this opportunity, positioning us for additional partnerships in the future.”

“This acquisition further strengthens Ameresco’s global presence by expanding our footprint and adding a new pipeline of work throughout Italy,” said George Sakellaris, President and CEO of Ameresco. “Ameresco’s mission is to create a more sustainable future for our customers, and we see the acquisition of ENERQOS as extending our proven track record of providing significant renewable energy and energy efficiency solutions to entities across North America and Europe that increase energy savings and lower carbon emissions.”

“It is with great excitement that we enter into this next phase of our business. Enerqos was built on a commitment to developing renewable energy solutions and establishing emission reduction targets, so as to usher in a greener, better future for all,” said Enrico Giglioli, CEO of ENERQOS. “As a leader in the cleantech space, Ameresco shares this belief and has a demonstrated history of implementing innovative technologies that deliver clean energy and enhance overall security, reliability, and resiliency.”

The acquisition is expected to close in March 2023. The financial terms of this acquisition were not disclosed. Included in our guidance, this small and opportunistic acquisition will further our footprint in Europe.

To learn more about Ameresco and the company’s clean energy solutions, visit www.ameresco.com.

About Ameresco, Inc.

Founded in 2000, Ameresco, Inc. (NYSE:AMRC) is a leading cleantech integrator and renewable energy asset developer, owner and operator. Our comprehensive portfolio includes energy efficiency, infrastructure upgrades, asset sustainability and renewable energy solutions delivered to clients throughout North America and Europe. Ameresco’s sustainability services in support of clients’ pursuit of Net Zero include upgrades to a facility’s energy infrastructure and the development, construction, and operation of distributed energy resources. Ameresco has successfully completed energy saving, environmentally responsible projects with Federal, state and local governments, healthcare and educational institutions, housing authorities, and commercial and industrial customers. With its corporate headquarters in Framingham, MA, Ameresco has more than 1,000 employees providing local expertise in the United States, Canada, and Europe. For more information, visit www.ameresco.com.

Forward Looking Statements

Any statements in this release about future expectations, plans and prospects for Ameresco, Inc., including statements about the expected timing and impact from the Enerqos acquisition and other statements containing the words “projects,” “believes,” “anticipates,” “plans,” “expects,” “will” and similar expressions, constitute forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by such forward looking statements as a result of various important factors including those discussed in our most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. The forward-looking statements included herein represent our views as of the date hereof. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to the date hereof.

View source version on businesswire.com: https://www.businesswire.com/news/home/20230227005729/en/

Media:

Ameresco: Leila Dillon, 508-661-2264, [email protected]

Investor Relations: Eric Prouty, AdvisIRy Partners, 212-750-5800, [email protected]

Lynn Morgen, AdvisIRy Partners, 212-750-5800, [email protected]

KEYWORDS: Massachusetts Europe United States Italy North America

INDUSTRY KEYWORDS: Utilities Construction & Property Sustainability Environment Alternative Energy Energy Building Systems Urban Planning

MEDIA:

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Posted on February 27, 2023 4:18 pm
CONMED Corporation Announces Quarterly Cash Dividend

CONMED Corporation Announces Quarterly Cash Dividend

LARGO, Fla.–(BUSINESS WIRE)–CONMED Corporation (NYSE: CNMD) today announced that its Board of Directors has declared a quarterly cash dividend of $0.20 per share, payable on April 5, 2023, to all shareholders of record as of March 15, 2023.

About CONMED Corporation

CONMED is a medical technology company that provides surgical devices and equipment for minimally invasive procedures. The Company’s products are used by surgeons and physicians in a variety of specialties, including orthopedics, general surgery, gynecology, thoracic surgery, and gastroenterology. For more information, visit www.conmed.com.

Forward-Looking Statements

This press release may contain forward-looking statements based on certain assumptions and contingencies that involve risks and uncertainties, which could cause actual results, performance, or trends to differ materially from those expressed in the forward-looking statements herein or in previous disclosures. For example, in addition to general industry and economic conditions, factors that could cause actual results to differ materially from those in the forward-looking statements may include, but are not limited to, the risks posed to the Company’s business, financial condition, and results of operations by the COVID-19 global pandemic and the various government responses to the pandemic, including deferral of surgeries, reductions in hospital and ambulatory surgery center operating volumes, disruption to potential supply chain reliability; any assumptions underlying any of the foregoing as well as the risk factors discussed in the Company’s Annual Report on Form 10-K for the full year ended December 31, 2022, listed under the heading Forward-Looking Statements in the Company’s most recently filed Form 10-K and other risks and uncertainties which may be detailed from time to time in reports filed by CONMED with the SEC. Any and all forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and relate to the Company’s performance on a going-forward basis. The Company believes that all forward-looking statements made by it have a reasonable basis, but there can be no assurance that management’s expectations, beliefs or projections as expressed in the forward-looking statements will actually occur or prove to be correct.

View source version on businesswire.com: https://www.businesswire.com/news/home/20230227005807/en/

CONMED Corporation

Todd Garner

Chief Financial Officer

727-214-2975

[email protected]

KEYWORDS: Florida United States North America

INDUSTRY KEYWORDS: Surgery Health Medical Devices

MEDIA:

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Posted on February 27, 2023 4:17 pm
National Storage Affiliates Trust Reports Fourth Quarter and Full Year 2022Results

National Storage Affiliates Trust Reports Fourth Quarter and Full Year 2022Results

GREENWOOD VILLAGE, Colo.–(BUSINESS WIRE)–
National Storage Affiliates Trust (“NSA” or the “Company”) (NYSE: NSA) today reported the Company’s fourth quarter and full year 2022 results.

Fourth Quarter 2022 Highlights

Reported net income of $50.4 million for the fourth quarter of 2022, an increase of 17.4% compared to the fourth quarter of 2021. Reported diluted earnings per share of $0.31 for the fourth quarter of 2022 compared to $0.25 for the fourth quarter of 2021.

Reported core funds from operations (“Core FFO”) of $90.9 million, or $0.71 per share for the fourth quarter of 2022, an increase of 10.9% per share compared to the fourth quarter of 2021.

Reported an increase in same store net operating income (“NOI”) of 9.4% for the fourth quarter of 2022 compared to the same period in 2021, driven by a 7.4% increase in same store total revenues partially offset by an increase of 1.6% in same store property operating expenses.

Reported same store period-end occupancy of 90.5% as of December 31, 2022, a decrease of 450 basis points compared to December 31, 2021.

Acquired two wholly-owned self storage properties for approximately $39.9 million during the fourth quarter of 2022. Consideration for these acquisitions included the issuance of $32.1 million of OP equity.

Repurchased 1,032,251 of the Company’s common shares for approximately $40.0 million under the previously announced share repurchase program.

Full Year 2022 Highlights

Reported net income of $183.8 million for full year 2022, an increase of 25.1% compared to full year 2021. Reported diluted earnings per share of $0.99 for full year 2022 compared to $0.98 for full year 2021.

Reported Core FFO of $363.0 million, or $2.81 per share for full year 2022, an increase of 24.3% per share compared to full year 2021.

Reported an increase in same store NOI of 14.9% for full year 2022 compared to full year 2021, driven by a 12.1% increase in same store total revenues partially offset by an increase of 4.8% in same store property operating expenses.

Acquired 45 wholly-owned self storage properties for approximately $569.2 million during full year 2022. Consideration for these acquisitions included the issuance of $68.9 million of OP equity.

Highlights Subsequent to Quarter-End

Entered into an agreement on January 3, 2023, with lenders to increase the total borrowing capacity under the Company’s credit facility by $405.0 million to $1.955 billion, and used incremental borrowings under the credit facility to retire $300.0 million of its $375.0 million of debt maturing in 2023.

One of the Company’s participating regional operators (“PROs”), Move It Self Storage and its controlled affiliates (“Move It”), retired effective January 1, 2023. As a result of the retirement, on January 1, 2023, management of the Company’s 72 properties in the Move It managed portfolio was transferred to NSA and the Move It brand name and related intellectual property were internalized by the Company. In addition, NSA will no longer pay supervisory and administrative fees or reimbursements to Move It and on January 1, 2023, issued a notice of non-voluntary conversion to cause all subordinated performance units related to Move It’s managed portfolio to convert into OP units. As part of the internalization, a majority of Move It’s employees were offered and provided employment by the Company to continue managing Move It’s portfolio of properties as members of NSA’s existing property management platform.

On February 24, 2023, the Company entered into an agreement with affiliates of Personal Mini, one of the Company’s PROs, to acquire a portfolio of 15 properties located in Florida for approximately $145.0 million, subject to receipt of approval from the selling entity’s shareholders and other customary closing conditions. The Company expects to complete the acquisition in the first quarter of 2023.

“NSA had another exceptional year with annual same store growth of nearly 15%, second highest in our history,” commented Tamara Fischer, Chief Executive Officer. “Our strong organic growth combined with our opportunistic acquisition strategy resulted in over 24% annual growth in core FFO per share. We believe these results demonstrate the strength of our team, the benefits of our geographically diverse portfolio, as well as the ongoing advantages of our differentiated PRO structure.”

Dave Cramer, President and Chief Operating Officer, stated, “We’re pleased with our strategies to balance rate and occupancy which produced double digit revenue growth of over 12% for the year, second highest in our history. I look forward to 2023 as we continue our focus on people, processes and platforms which will allow us to deliver growth and optimize value for all of our stakeholders.”

Financial Results

($ in thousands, except per share and unit data)

Three Months Ended December 31,

Year Ended December 31,

2022

2021

Growth

2022

2021

Growth

Net income

$

50,377

$

42,895

17.4

%

$

183,765

$

146,935

25.1

%

Funds From Operations (“FFO”)⁽¹⁾

$

89,890

$

77,917

15.4

%

$

353,893

$

255,393

38.6

%

Add back acquisition costs

368

1,019

(63.9

)%

2,745

1,941

41.4

%

Add back casualty-related expenses

634

—

—

%

6,388

—

—

%

Core FFO⁽¹⁾

$

90,892

$

78,936

15.1

%

$

363,026

$

257,334

41.1

%

Earnings per share – basic

$

0.31

$

0.25

24.0

%

$

0.99

$

1.13

(12.4

)%

Earnings per share – diluted

$

0.31

$

0.25

24.0

%

$

0.99

$

0.98

1.0

%

FFO per share and unit⁽¹⁾

$

0.70

$

0.63

11.1

%

$

2.74

$

2.24

22.3

%

Core FFO per share and unit⁽¹⁾

$

0.71

$

0.64

10.9

%

$

2.81

$

2.26

24.3

%

(1)

Non-GAAP financial measures, including FFO, Core FFO and NOI, are defined in the Glossary in the supplemental financial information and, where appropriate, reconciliations of these measures and other non-GAAP financial measures to their most directly comparable GAAP measures are included in the Schedules to this press release and in the supplemental financial information.

Net income increased $7.5 million for the fourth quarter of 2022 and increased by $36.8 million for the year ended December 31, 2022 (“year-to-date”) as compared to the same periods in 2021. The increases resulted primarily from additional NOI generated from the 45 wholly-owned self storage properties acquired during the year ended December 31, 2022, same store NOI growth, increases in management fees and other revenue, and an increase in equity in earnings from the Company’s unconsolidated real estate ventures, partially offset by increases in depreciation and amortization, interest expense and general administrative expenses.

The increases in FFO and Core FFO for the fourth quarter of 2022 and year-to-date were primarily the result of incremental NOI from properties acquired during the year ended December 31, 2022 and same store NOI growth, partially offset by an increase in interest expense.

Same Store Operating Results (628 Stores)

($ in thousands, except per square foot data)

Three Months Ended December 31,

Year Ended December 31,

2022

2021

Growth

2022

2021

Growth

Total revenues

$

139,470

$

129,910

7.4

%

$

548,739

$

489,338

12.1

%

Property operating expenses

34,350

33,810

1.6

%

140,724

134,276

4.8

%

Net Operating Income (NOI)

$

105,120

$

96,100

9.4

%

$

408,015

$

355,062

14.9

%

NOI Margin

75.4

%

74.0

%

1.4

%

74.4

%

72.6

%

1.8

%

Average Occupancy

91.4

%

95.6

%

(4.2

)%

93.8

%

94.7

%

(0.9

)%

Average Annualized Rental Revenue Per Occupied Square Foot

$

15.44

$

13.74

12.4

%

$

14.80

$

13.05

13.4

%

Year-over-year same store total revenues increased 7.4% for the fourth quarter of 2022 and 12.1% year-to-date as compared to the same periods in 2021. The increase for the fourth quarter was driven primarily by a 12.4% increase in average annualized rental revenue per occupied square foot, partially offset by a 4.2% decrease in average occupancy. The year-to-date increase was driven primarily by a 13.4% increase in average annualized rental revenue per occupied square foot, partially offset by a 90 basis point decrease in average occupancy. Markets which generated above portfolio average same store total revenue growth include: Riverside-San Bernardino, Atlanta, and McAllen-Edinburg. Markets which generated below portfolio average same store total revenue growth include: Portland, New Orleans and Kansas City.

Year-over-year same store property operating expenses increased 1.6% for the fourth quarter of 2022 and 4.8% year-to-date as compared to the same periods in 2021. The increases primarily resulted from increases in marketing, utilities, and year-to-date property tax expense offset by a decrease in personnel costs.

Investment Activity

During the fourth quarter, NSA invested $39.9 million in the acquisition of two wholly-owned self storage properties consisting of approximately 196,000 rentable square feet configured in approximately 1,800 storage units. Total consideration for these acquisitions included approximately $7.6 million of net cash, the issuance of approximately $16.2 million of OP units, $15.9 million of SP units and the assumption of approximately $0.2 million of other liabilities.

Balance Sheet

During the fourth quarter, NSA repurchased 1,032,251 of the Company’s common shares for approximately $40.0 million under the previously announced share repurchase program. For the full year 2022, the Company repurchased 1,986,175 shares for approximately $90.0 million. Under the program, the Company has remaining capacity of approximately $310.0 million out of a total of $400.0 million authorized.

On January 3, 2023, the Company entered into a third amended and restated credit agreement which expands the total borrowing capacity of its credit facility by $405.0 million to $1.955 billion with an accordion feature to expand the total borrowing capacity to $2.5 billion. The maturity date of the revolving line of credit is now January 2027 versus the previous maturity date of January 2024, while the total borrowing capacity was increased to $950.0 million from $650.0 million. In connection with the credit facility recast, the Company retired its $125.0 million term loan due January 2023 and its $175.0 million term loan facility due in June 2023, and converted LIBOR-based borrowings to SOFR. The Company funded the retirements with $230.0 million of incremental borrowings on existing term loans and $70.0 million of borrowings on its revolving line of credit. In Schedule 4 of the supplemental financial information, the Company has presented its debt summary as of December 31, 2022, giving pro forma effect for the credit facility recast, debt retirements, and an interest rate swap that was effective starting February 1, 2023.

Common Share Dividends

On November 9, 2022, NSA’s Board of Trustees declared a quarterly cash dividend of $0.55 per common share, representing a 22.2% increase from the fourth quarter 2021. The fourth quarter 2022 dividend was paid on December 30, 2022 to shareholders of record as of December 15, 2022.

For full year 2022, NSA’s Board of Trustees declared cash dividends of $2.15 per common share, representing a 35.2% increase from 2021.

2023 Guidance

The following table outlines NSA’s Core FFO per share guidance estimates and related assumptions for the year ended December 31, 2023.

Ranges for Full Year 2023

Actual

Results for

Full Year

2022

Low

High

Core FFO per share⁽¹⁾

$2.78

$2.86

$2.81

Same store operations⁽²⁾

Total revenue growth

3.75%

5.25%

12.1%

Property operating expenses growth

4.50%

6.00%

4.8%

NOI growth

3.00%

5.50%

14.9%

General and administrative expenses

General and administrative expenses (excluding equity-based compensation), in millions

$53.0

$55.0

$53.1

Equity-based compensation, in millions

$6.5

$7.0

$6.3

Management fees and other revenue, in millions

$28.0

$30.0

$27.6

Core FFO from unconsolidated real estate ventures, in millions

$25.0

$26.5

$24.8

Subordinated performance unit distributions, in millions

$51.0

$53.0

$58.8

Acquisitions of self storage properties, in millions

$200.0

$400.0

$569.2

Ranges for

Full Year 2023

Low

High

Earnings (loss) per share – diluted

$1.25

$1.31

Impact of the difference in weighted average number of shares and GAAP accounting for noncontrolling interests, two-class method and treasury stock method

0.07

0.02

Add real estate depreciation and amortization, including NSA’s share of unconsolidated venture real estate depreciation and amortization

1.83

1.91

FFO attributable to subordinated unitholders

(0.38

)

(0.41

)

Add loss on early extinguishment of debt

—

0.01

Add acquisition costs and NSA’s share of unconsolidated real estate venture acquisition costs

0.01

0.02

Core FFO per share and unit

$2.78

$2.86

(1) The table above provides a reconciliation of the range of estimated earnings (loss) per share – diluted to estimated Core FFO per share and unit.

(2) 2023 guidance reflects NSA’s 2023 same store pool comprising 834 stores. 2022 actual results reflect NSA’s 2022 same store pool comprising 628 stores.

Supplemental Financial Information

The full text of this earnings release and supplemental financial information, including certain financial information referenced in this release, are available on NSA’s website at http://ir.nationalstorageaffiliates.com/quarterly-reporting and as exhibit 99.1 to the Company’s Form 8-K furnished to the SEC on February 27, 2023.

Non-GAAP Financial Measures & Glossary

This press release contains certain non-GAAP financial measures. These non-GAAP measures are presented because NSA’s management believes these measures help investors understand NSA’s business, performance and ability to earn and distribute cash to its shareholders by providing perspectives not immediately apparent from net income (loss). These measures are also frequently used by securities analysts, investors and other interested parties. The presentations of FFO, Core FFO and NOI in this press release are not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. In addition, NSA’s method of calculating these measures may be different from methods used by other companies, and, accordingly, may not be comparable to similar measures as calculated by other companies that do not use the same methodology as NSA. These measures, and other words and phrases used herein, are defined in the Glossary in the supplemental financial information and, where appropriate, reconciliations of these measures and other non-GAAP financial measures to their most directly comparable GAAP measures are included in the Schedules to this press release and in the supplemental financial information.

Quarterly Teleconference and Webcast

The Company will host a conference call at 1:00 pm Eastern Time on Tuesday, February 28, 2023 to discuss its fourth quarter 2022 financial results. At the conclusion of the call, management will accept questions from certified financial analysts. All other participants are encouraged to listen to a webcast of the call by accessing the link found on the Company’s website at www.nationalstorageaffiliates.com.

Conference Call and Webcast:

Date/Time: Tuesday, February 28, 2023, 1:00 pm ET

Webcast available at: www.nationalstorageaffiliates.com

Domestic (Toll Free US & Canada): 877.407.9711

International: 412.902.1014

A replay of the webcast will be available for 30 days on NSA’s website at www.nationalstorageaffiliates.com.

Upcoming Industry Conference

NSA management is scheduled to participate in Citi’s 2023 Global Property CEO Conference on March 6 – 8, 2023 in Hollywood, Florida.

About National Storage Affiliates Trust

National Storage Affiliates Trust is a real estate investment trust headquartered in Greenwood Village, Colorado, focused on the ownership, operation and acquisition of self storage properties predominantly located within the top 100 metropolitan statistical areas throughout the United States. As of December 31, 2022, the Company held ownership interests in and operated 1,101 self storage properties located in 42 states and Puerto Rico with approximately 71.8 million rentable square feet. NSA is one of the largest owners and operators of self storage properties among public and private companies in the United States. For more information, please visit the Company’s website at www.nationalstorageaffiliates.com. NSA is included in the MSCI US REIT Index (RMS/RMZ), the Russell 1000 Index of Companies and the S&P MidCap 400 Index.

NOTE REGARDING FORWARD LOOKING STATEMENTS

Certain statements contained in this press release constitute forward-looking statements as such term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and such statements are intended to be covered by the safe harbor provided by the same. Forward-looking statements are subject to substantial risks and uncertainties, many of which are difficult to predict and are generally beyond the Company’s control. These forward-looking statements include information about possible or assumed future results of the Company’s business, financial condition, liquidity, results of operations, plans and objectives. Changes in any circumstances may cause the Company’s actual results to differ significantly from those expressed in any forward-looking statement. When used in this release, the words “believe,” “expect,” “anticipate,” “estimate,” “plan,” “continue,” “intend,” “should,” “may” or similar expressions are intended to identify forward-looking statements. Statements regarding the following subjects, among others, may be forward-looking: market trends in the Company’s industry, interest rates, inflation, the debt and lending markets or the general economy; the Company’s business and investment strategy; the acquisition of properties, including those under contract and the Company’s ability to execute on its acquisition pipeline; the timing of acquisitions under contract; the internalization of retiring participating regional operators (“PROs”) into the Company; and the Company’s guidance estimates for the year ended December 31, 2023. For a further list and description of such risks and uncertainties, see the Company’s most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed with the Securities and Exchange Commission, and the other documents filed by the Company with the Securities and Exchange Commission. The forward-looking statements, and other risks, uncertainties and factors are based on the Company’s beliefs, assumptions and expectations of its future performance, taking into account all information currently available to the Company. Forward-looking statements are not predictions of future events. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

National Storage Affiliates Trust

Consolidated Statements of Operations

(in thousands, except per share amounts)

(unaudited)

Three Months Ended December 31,

Year Ended December 31,

2022

2021

2022

2021

REVENUE

Rental revenue

$

195,985

$

161,690

$

748,814

$

541,547

Other property-related revenue

6,224

5,643

25,131

19,750

Management fees and other revenue

6,513

6,257

27,624

24,374

Total revenue

208,722

173,590

801,569

585,671

OPERATING EXPENSES

Property operating expenses

53,347

44,542

211,025

155,265

General and administrative expenses

15,345

14,301

59,311

51,001

Depreciation and amortization

57,564

50,854

233,158

158,312

Other

1,186

1,152

8,537

2,853

Total operating expenses

127,442

110,849

512,031

367,431

OTHER (EXPENSE) INCOME

Interest expense

(34,633

)

(19,787

)

(110,599

)

(72,062

)

Equity in earnings of unconsolidated real estate ventures

2,155

1,679

7,745

5,294

Acquisition costs

(368

)

(1,019

)

(2,745

)

(1,941

)

Non-operating expense

(352

)

(344

)

(951

)

(906

)

Gain on sale of self storage properties

3,332

—

5,466

—

Other expense, net

(29,866

)

(19,471

)

(101,084

)

(69,615

)

Income before income taxes

51,414

43,270

188,454

148,625

Income tax expense

(1,037

)

(375

)

(4,689

)

(1,690

)

Net income

50,377

42,895

183,765

146,935

Net income attributable to noncontrolling interests

(19,117

)

(17,422

)

(80,028

)

(41,682

)

Net income attributable to National Storage Affiliates Trust

31,260

25,473

103,737

105,253

Distributions to preferred shareholders

(3,382

)

(3,277

)

(13,425

)

(13,104

)

Net income attributable to common shareholders

$

27,878

$

22,196

$

90,312

$

92,149

Earnings per share – basic

$

0.31

$

0.25

$

0.99

$

1.13

Earnings per share – diluted

$

0.31

$

0.25

$

0.99

$

0.98

Weighted average shares outstanding – basic

90,627

89,763

91,239

81,195

Weighted average shares outstanding – diluted

90,627

89,763

91,239

134,538

National Storage Affiliates Trust

Consolidated Balance Sheets

(dollars in thousands, except per share amounts)

(unaudited)

December 31,

December 31,

2022

2021

ASSETS

Real estate

Self storage properties

$

6,391,572

$

5,798,188

Less accumulated depreciation

(772,661

)

(578,717

)

Self storage properties, net

5,618,911

5,219,471

Cash and cash equivalents

35,312

25,013

Restricted cash

6,887

2,862

Debt issuance costs, net

1,393

2,433

Investment in unconsolidated real estate ventures

227,441

188,187

Other assets, net

156,228

102,417

Operating lease right-of-use assets

23,835

22,211

Total assets

$

6,070,007

$

5,562,594

LIABILITIES AND EQUITY

Liabilities

Debt financing

$

3,551,179

$

2,940,931

Accounts payable and accrued liabilities

80,377

59,262

Interest rate swap liabilities

483

33,757

Operating lease liabilities

25,741

23,981

Deferred revenue

23,213

22,208

Total liabilities

3,680,993

3,080,139

Equity

Preferred shares of beneficial interest, par value $0.01 per share. 50,000,000 authorized, 9,017,588 and 8,736,719 issued and outstanding at December 31, 2022 and December 31, 2021, respectively, at liquidation preference

225,439

218,418

Common shares of beneficial interest, par value $0.01 per share. 250,000,000 shares authorized, 89,842,145 and 91,198,929 shares issued and outstanding at December 31, 2022 and December 31, 2021, respectively

898

912

Additional paid-in capital

1,777,984

1,866,773

Distributions in excess of earnings

(396,650

)

(291,263

)

Accumulated other comprehensive income (loss)

40,530

(19,611

)

Total shareholders’ equity

1,648,201

1,775,229

Noncontrolling interests

740,813

707,226

Total equity

2,389,014

2,482,455

Total liabilities and equity

$

6,070,007

$

5,562,594

Reconciliation of Net Income to FFO and Core FFO

(in thousands, except per share and unit amounts) (unaudited)

Three Months Ended December 31,

Year Ended December 31,

2022

2021

2022

2021

Net income

$

50,377

$

42,895

$

183,765

$

146,935

Add (subtract):

Real estate depreciation and amortization

57,227

50,526

231,870

156,930

Company’s share of unconsolidated real estate venture real estate depreciation and amortization

4,461

3,845

17,072

15,408

Gain on sale of self storage properties

(3,332

)

—

(5,466

)

—

Distributions to preferred shareholders and unitholders

(3,653

)

(3,519

)

(14,510

)

(14,070

)

FFO attributable to subordinated performance unitholders⁽¹⁾

(15,190

)

(15,830

)

(58,838

)

(49,810

)

FFO attributable to common shareholders, OP unitholders, and LTIP unitholders

89,890

77,917

353,893

255,393

Add:

Acquisition costs

368

1,019

2,745

1,941

Casualty-related expenses⁽²⁾

634

—

6,388

—

Core FFO attributable to common shareholders, OP unitholders, and LTIP unitholders

$

90,892

$

78,936

$

363,026

$

257,334

Weighted average shares and units outstanding – FFO and Core FFO:⁽³⁾

Weighted average shares outstanding – basic

90,627

89,763

91,239

81,195

Weighted average restricted common shares outstanding

25

34

27

33

Weighted average effect of forward offering agreement⁽⁴⁾

—

—

—

100

Weighted average OP units outstanding

35,601

30,681

35,421

30,127

Weighted average DownREIT OP unit equivalents outstanding

1,925

1,925

1,925

1,925

Weighted average LTIP units outstanding

476

523

514

542

Total weighted average shares and units outstanding – FFO and Core FFO

128,654

122,926

129,126

113,922

FFO per share and unit

$

0.70

$

0.63

$

2.74

$

2.24

Core FFO per share and unit

$

0.71

$

0.64

$

2.81

$

2.26

(1)

Amounts represent distributions declared for subordinated performance unitholders and DownREIT subordinated performance unitholders for the periods presented.

(2)

These casualty-related expenses are recorded in the line item “Other” within operating expenses in our consolidated statement of operations.

(3)

NSA combines OP units and DownREIT OP units with common shares because, after the applicable lock-out periods, OP units in the Company’s operating partnership are redeemable for cash or, at NSA’s option, exchangeable for common shares on a one-for-one basis and DownREIT OP units are also redeemable for cash or, at NSA’s option, exchangeable for OP units in the Company’s operating partnership on a one-for-one basis, subject to certain adjustments in each case. Subordinated performance units, DownREIT subordinated performance units and LTIP units may also, under certain circumstances, be convertible into or exchangeable for common shares (or other units that are convertible into or exchangeable for common shares). See footnote⁽⁵⁾ for additional discussion of subordinated performance units, DownREIT subordinated performance units, and LTIP units in the calculation of FFO and Core FFO per share and unit.

(4)

Represents the dilutive effect of the forward offering from the application of the treasury stock method.

Reconciliation of Earnings Per Share – Diluted to FFO and Core FFO Per Share and Unit

(in thousands, except per share and unit amounts) (unaudited)

Three Months Ended December 31,

Year Ended December 31,

2022

2021

2022

2021

Earnings per share – diluted

$

0.31

$

0.25

$

0.99

$

0.98

Impact of the difference in weighted average number of shares⁽⁵⁾

(0.08

)

(0.07

)

(0.28

)

0.18

Impact of GAAP accounting for noncontrolling interests, two-class method and treasury stock method⁽⁶⁾

0.15

0.14

0.62

—

Add real estate depreciation and amortization

0.44

0.41

1.79

1.38

Add Company’s share of unconsolidated real estate venture real estate depreciation and amortization

0.03

0.03

0.13

0.14

Subtract gain on sale of self storage properties

(0.03

)

—

(0.05

)

—

FFO attributable to subordinated performance unitholders

(0.12

)

(0.13

)

(0.46

)

(0.44

)

FFO per share and unit

0.70

0.63

2.74

2.24

Add acquisition costs

—

0.01

0.02

0.02

Add casualty-related expenses

0.01

—

0.05

—

Core FFO per share and unit

$

0.71

$

0.64

$

2.81

$

2.26

(5)

Adjustment accounts for the difference between the weighted average number of shares used to calculate diluted earnings per share and the weighted average number of shares used to calculate FFO and Core FFO per share and unit. Diluted earnings per share is calculated using the two-class method for the company’s restricted common shares and the treasury stock method for certain unvested LTIP units, and assumes the conversion of vested LTIP units into OP units on a one-for-one basis and the hypothetical conversion of subordinated performance units, and DownREIT subordinated performance units into OP units, even though such units may only be convertible into OP units (i) after a lock-out period and (ii) upon certain events or conditions. For additional information about the conversion of subordinated performance units and DownREIT subordinated performance units into OP units, see Note 10 to the Company’s most recent Annual Report on Form 10-K, filed with the Securities and Exchange Commission. The computation of weighted average shares and units for FFO and Core FFO per share and unit includes all restricted common shares and LTIP units that participate in distributions and excludes all subordinated performance units and DownREIT subordinated performance units because their effect has been accounted for through the allocation of FFO to the related unitholders based on distributions declared.

(6)

Represents the effect of adjusting the numerator to consolidated net income (loss) prior to GAAP allocations for noncontrolling interests, after deducting preferred share and unit distributions, and before the application of the two-class method and treasury stock method, as described in footnote⁽⁵⁾.

Net Operating Income

(dollars in thousands) (unaudited)

Three Months Ended December 31,

Year Ended December 31,

2022

2021

2022

2021

Net income

$

50,377

$

42,895

$

183,765

$

146,935

(Subtract) add:

Management fees and other revenue

(6,513

)

(6,257

)

(27,624

)

(24,374

)

General and administrative expenses

15,345

14,301

59,311

51,001

Other

1,186

1,152

8,537

2,853

Depreciation and amortization

57,564

50,854

233,158

158,312

Interest expense

34,633

19,787

110,599

72,062

Equity in earnings of unconsolidated real estate ventures

(2,155

)

(1,679

)

(7,745

)

(5,294

)

Acquisition costs

368

1,019

2,745

1,941

Income tax expense

1,037

375

4,689

1,690

Gain on sale of self storage properties

(3,332

)

—

(5,466

)

—

Non-operating expense

352

344

951

906

Net Operating Income

$

148,862

$

122,791

$

562,920

$

406,032

EBITDA and Adjusted EBITDA

(dollars in thousands) (unaudited)

Three Months Ended December 31,

Year Ended December 31,

2022

2021

2022

2021

Net income

$

50,377

$

42,895

$

183,765

$

146,935

Add:

Depreciation and amortization

57,564

50,854

233,158

158,312

Company’s share of unconsolidated real estate venture depreciation and amortization

4,461

3,845

17,072

15,408

Interest expense

34,633

19,787

110,599

72,062

Income tax expense

1,037

375

4,689

1,690

EBITDA

148,072

117,756

549,283

394,407

Add (subtract):

Acquisition costs

368

1,019

2,745

1,941

Gain on sale of self storage properties

(3,332

)

—

(5,466

)

—

Casualty related expenses (recoveries)

634

—

6,388

—

Equity-based compensation expense

1,588

1,374

6,258

5,462

Adjusted EBITDA

$

147,330

$

120,149

$

559,208

$

401,810

View source version on businesswire.com: https://www.businesswire.com/news/home/20230227005732/en/

National Storage Affiliates Trust

Investor/Media Relations

George Hoglund, CFA

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Posted on February 27, 2023 4:17 pm
CBRE Global Real Estate Income Fund (NYSE: IGR) Announces Terms of Rights Offering

CBRE Global Real Estate Income Fund (NYSE: IGR) Announces Terms of Rights Offering

PHILADELPHIA–(BUSINESS WIRE)–
The Board of Trustees (the “Board”) of the CBRE Global Real Estate Income Fund (NYSE: IGR) (the “Fund”) today announced that it has approved the terms of the issuance of transferable rights (“Rights”) to the holders of the Fund’s common shares (par value $0.001 per share) (“Common Shares”), as of the record date, March 9, 2023 (the “Record Date”), to subscribe for additional Common Shares at a discount to market price (the “Offer”).

After considering a number of factors, including potential benefits and costs, the Board and the Fund’s investment advisor, CBRE Investment Management Listed Real Assets LLC (the “Advisor”), have determined that it is in the best interests of both the Fund and its shareholders to conduct the rights offering so that, with increased assets, the Fund will be well positioned to seek to take advantage of existing and future investment opportunities in the global real estate markets that the Advisor considers to be consistent with the Fund’s primary investment objective of high current income and secondary investment objective of capital appreciation.

The Advisor believes this is an attractive time to raise additional assets for the Fund based on several factors, including, but not limited to, the following potential benefits:

– Attractive valuations: the Advisor’s belief that many global real estate securities currently are trading at historically attractive valuations

– Growth potential: anticipated significant opportunities for investment in real estate sectors aligned with long-term secular themes driving above average growth potential

– Total return: potential enhancement of the Fund’s distribution and/or net asset value (NAV) appreciation

– Lower Fund expenses: anticipated positive impact to the Fund’s total expense ratio by spreading fixed costs over a larger asset base

– Tax-efficiency: potential reduction in the need to sell existing portfolio positions, which may reduce taxable events for shareholders

“Global real estate stocks are attractively valued today; we have not seen valuation levels like this since the global financial crisis in 2008-2009 and the initial COVID drawdown in March 2020. Our team’s analysis of historical market environments suggests that today’s market conditions are favorable for global real estate stock investment,” said Joseph Smith, Chief Investment Officer of CBRE Investment Management Strategies and a Portfolio Manager of the Fund.

Holders of Common Shares as of the Record Date will be entitled to participate in the Offer, which will include an over-subscription privilege. Additional information on the Offer is set forth in a Prospectus Supplement dated February 27, 2023, which supplements the Fund’s currently effective shelf offering Prospectus and Statement of Additional Information, which together list the Fund’s strategies and risks.

The Fund declared a regular monthly distribution payable on February 28, 2023, and anticipates declaring a regular monthly distribution payable on March 31, 2023, with respective record dates of February 21, 2023 and March 20, 2023, which will not be payable with respect to Shares that are issued pursuant to the Offer as such issuance will occur after the distribution record dates. Shares issued pursuant to the Offer will be entitled to receive the monthly distribution expected to be payable in April.

Certain key terms of the Offer include:

Title

Subscription Rights to Acquire Common Shares

Rights Issuance

One Right will be issued for every Common Share held as of the Record Date

Subscription Ratio

One new Common Share for every five Rights held (1 for 5)

Subscription Price

Will be determined based upon a formula equal to 95% of the average of the last reported sales price of a Common Share on the NYSE on the Expiration Date and each of the four (4) immediately preceding trading days

Rights

Rights will be transferable and listed on the NYSE with the symbol “IGR RT”

Offer Period

March 9, 2023 (Record Date) through April 6, 2023 (Expiration Date)

Expected Mailing Date for Certificates Evidencing the Right to Subscribe

On or about March 13, 2023

For further information and/or to obtain a copy of the Prospectus Supplement and accompanying Prospectus when available, contact the Information Agent, Georgeson at 1-866-216-0462.

About CBRE Investment Management

CBRE Investment Management is a leading global real assets investment management firm with $149.3 billion in assets under management* as of December 31, 2022, operating in more than 30 offices and 20 countries around the world. Through its investor-operator culture, the firm seeks to deliver sustainable investment solutions across real assets categories, geographies, risk profiles and execution formats so that its clients, people and communities thrive.

CBRE Investment Management is an independently operated affiliate of CBRE Group, Inc. (NYSE:CBRE), the world’s largest commercial real estate services and investment firm (based on 2022 revenue). CBRE has approximately 115,000 employees (excluding Turner & Townsend employees) serving clients in more than 100 countries. CBRE Investment Management harnesses CBRE’s data and market insights, investment sourcing and other resources for the benefit of its clients. For more information, please visit www.cbreim.com.

*Assets under management (AUM) refers to the fair market value of real assets-related investments with respect to which CBRE Investment Management provides, on a global basis, oversight, investment management services and other advice and which generally consist of investments in real assets; equity in funds and joint ventures; securities portfolios; operating companies and real assets-related loans. This AUM is intended principally to reflect the extent of CBRE Investment Management’s presence in the global real assets market, and its calculation of AUM may differ from the calculations of other asset managers and from its calculation of regulatory assets under management for purposes of certain regulatory filings.

View source version on businesswire.com: https://www.businesswire.com/news/home/20230227005806/en/

Analyst and Press Inquiries:

David Leggette

+1 610 995 7349

[email protected]

Investor Relations:

+1 888 711 4272

www.cbreim.com/igr

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