Market Newsdesk

May 5, 2021 4:40 pm

Two Harbors Investment Corp. Reports First Quarter 2021 Financial Results

Two Harbors Investment Corp. Reports First Quarter 2021 Financial Results

Hedge Benefits of MSR Result in Stable Performance During Volatile Quarter

NEW YORK–(BUSINESS WIRE)–
Two Harbors Investment Corp. (NYSE: TWO), an Agency + MSR mortgage real estate investment trust (REIT), today announced its financial results for the quarter ended March 31, 2021.

Quarterly Summary

Reported book value of $7.29 per common share, representing a (2.2)% quarterly return on book value⁽¹⁾
Generated Comprehensive Income of $(48.5) million, representing an annualized return on average common equity of (9.3)%
Reported Core Earnings of $45.8 million, or $0.17 per weighted average basic common share⁽²⁾
Declared a first quarter common stock dividend of $0.17 per share
Continued strength in mortgage servicing rights (MSR) flow-sale program; settled $21.3 billion unpaid principal balance (UPB) of MSR
- Closed on an additional $1.1 billion UPB of MSR and executed term sheets on an additional $7.2 billion of UPB of MSR through bulk purchases
Executed on actions to optimize liability and capital structure:
- Issued $287.5 million principal amount of 5-year convertible senior notes due 2026
- Repurchased and retired $143.7 million principal amount of convertible senior notes due 2022
- Completed the redemption of $75 million Series D and $200 million Series E preferred shares
Expanded funding capacity with the closing of a $300 million MSR asset financing facility, of which $225 million is committed

Post Quarter End Update

Executed term sheets on $6.1 billion UPB of MSR through bulk purchases

“With mortgage spreads at historically tight levels, our Agency + MSR strategy, with its lower exposure to mortgage spreads, is especially attractive,” stated Bill Greenberg, Two Harbors’ President and Chief Executive Officer. “As spreads normalize, we expect to increase leverage and deploy excess capital at more attractive levels. In the meantime, we are committed to growing our MSR portfolio and have expanded our funding capacity to execute on that strategy.”

(1) Return on book value is defined as the increase (decrease) in book value per common share from the beginning to the end of the given period, plus dividends declared in the period, divided by book value as of the beginning of the period.

(2) Core Earnings is a non-GAAP measure. Please see page 11 for a definition of Core Earnings and a reconciliation of GAAP to non-GAAP financial information.

Operating Performance

The following table summarizes the company’s GAAP and non-GAAP earnings measurements and key metrics for the first quarter of 2021 and fourth quarter of 2020:

Two Harbors Investment Corp. Operating Performance (unaudited)
(dollars in thousands, except per common share data)
	Three Months Ended March 31, 2021							Three Months Ended December 31, 2020
Earnings attributable to common stockholders	Earnings			Per weighted average basic common share		Annualized return on average common equity		Earnings			Per weighted average basic common share		Annualized return on average common equity
Comprehensive (Loss) Income	$	(48,512)		$	(0.18)	(9.3)	%	$	113,481		$	0.41	22.1	%
GAAP Net Income	$	222,941		$	0.81	42.8	%	$	192,220		$	0.70	37.4	%
Core Earnings⁽¹⁾	$	45,830		$	0.17	8.8	%	$	82,007		$	0.30	15.9	%

Operating Metrics
Dividend per common share	$	0.17						$	0.17
Annualized dividend yield⁽²⁾	9.3		%					10.7		%
Book value per common share at period end	$	7.29						$	7.63
Return on book value⁽³⁾	(2.2)		%					5.8		%
Operating expenses, excluding non-cash LTIP amortization and nonrecurring expenses⁽⁴⁾	$	11,914						$	14,673
Operating expenses, excluding non-cash LTIP amortization and nonrecurring expenses, as a percentage of average equity⁽⁴⁾	1.6		%					1.9		%

___________

(1)		Please see page 11 for a definition of Core Earnings and a reconciliation of GAAP to non-GAAP financial information.
(2)		Dividend yield is calculated based on annualizing the dividends declared in the given period, divided by the closing share price as of the end of the period.
(3)		Return on book value is defined as the increase (decrease) in book value per common share from the beginning to the end of the given period, plus dividends declared in the period, divided by the book value as of the beginning of the period.
(4)		Excludes non-cash equity compensation expense of $1.8 million for the first quarter of 2021 and $2.2 million for the fourth quarter of 2020 and nonrecurring expenses of $2.0 million for the first quarter of 2021 and $1.5 million for the fourth quarter of 2020.

“We grew the MSR portfolio despite high refinance rates, demonstrating the strength of our platform,” stated Matt Koeppen, Two Harbors’ Chief Investment Officer. “The MSR market remains healthy and performance should be well-supported in a higher rate environment. We expect to continue to source new servicing through flow and bulk channels at attractive levels.”

Portfolio Summary

The company’s portfolio was comprised of $13.6 billion of Agency residential mortgage-backed securities (RMBS), Agency Derivatives and MSR as well as their associated notional hedges as of March 31, 2021. Additionally, the company held $5.0 billion bond equivalent value of net long to-be-announced securities (TBAs).

The following tables summarize the company’s investment portfolio as of March 31, 2021 and December 31, 2020:

Two Harbors Investment Corp. Portfolio
(dollars in thousands)

Portfolio Composition		As of March 31, 2021						As of December 31, 2020
		(unaudited)						(unaudited)
Agency
Fixed Rate		$	11,453,989	84.1		%		$	14,627,097	89.7	%
Other Agency⁽¹⁾		64,011		0.4		%		72,411		0.4	%
Total Agency		11,518,000		84.5		%		14,699,508		90.1	%
Mortgage servicing rights⁽²⁾		2,091,761		15.4		%		1,596,153		9.8	%
Other		9,219		0.1		%		13,031		0.1	%
Aggregate Portfolio		$	13,618,980					$	16,308,692
Net TBA position⁽³⁾		5,024,575						5,481,479
Total Portfolio		$	18,643,555					$	21,790,171

Portfolio Metrics	Three Months Ended March 31, 2021						Three Months Ended December 31, 2020
	(unaudited)						(unaudited)
Annualized portfolio yield during the quarter⁽⁴⁾	2.25				%		2.26				%
Annualized cost of funds on average borrowing balance during the quarter⁽⁵⁾	0.60				%		0.50				%
Annualized net yield for aggregate portfolio during the quarter	1.65				%		1.76				%

________________

(1)		Other Agency includes hybrid ARMs and Agency derivatives.
(2)		Based on the loans underlying the MSR reported by subservicers on a month lag, adjusted for current month purchases.
(3)		Represents bond equivalent value of TBA position. Bond equivalent value is defined as notional amount multiplied by market price. Accounted for as derivative instruments in accordance with GAAP.
(4)		Includes interest income on RMBS and servicing income net of servicing expenses and amortization on MSR.
(5)		Cost of funds includes interest spread income/expense associated with the portfolio’s interest rate swaps.

Portfolio Metrics Specific to RMBS and Agency Derivatives	As of March 31, 2021			As of December 31, 2020
	(unaudited)			(unaudited)
Weighted average cost basis of Agency principal and interest securities⁽⁶⁾	$	104.90		$	104.95
Weighted average three month CPR on Agency RMBS	30.8		%	27.0		%
Fixed-rate investments as a percentage of aggregate RMBS and Agency Derivatives portfolio	99.4		%	99.4		%
Adjustable-rate investments as a percentage of aggregate RMBS and Agency Derivatives portfolio	0.6		%	0.6		%

______________

(6)

Weighted average cost basis includes RMBS principal and interest securities only. Average purchase price utilized carrying value for weighting purposes.

Portfolio Metrics Specific to MSR⁽¹⁾	As of March 31, 2021			As of December 31, 2020
(dollars in thousands)	(unaudited)			(unaudited)

Unpaid principal balance	$	179,014,244		$	177,861,483
Gross weighted average coupon	3.6		%	3.7		%
Weighted average original FICO score⁽²⁾	757			756
Weighted average original LTV	73		%	74		%
60+ day delinquencies	2.9		%	3.2		%
Net servicing fee	26.5 basis points			26.8 basis points

	Three Months Ended March 31, 2021			Three Months Ended December 31, 2020
	(unaudited)			(unaudited)
Fair value gains	$	327,438		$	2,522
Servicing income	$	107,119		$	100,549
Servicing expenses	$	24,221		$	22,595
Change in servicing reserves	$	661		$	1,591

________________

Note:		The company does not directly service mortgage loans, but instead contracts with appropriately licensed subservicers to handle substantially all servicing functions in the name of the subservicer for the loans underlying the company’s MSR.
(1)		Metrics exclude residential mortgage loans in securitization trusts for which the company is the named servicing administrator.
(2)		FICO represents a mortgage industry accepted credit score of a borrower.

Other Investments and Risk Management Metrics	As of March 31, 2021		As of December 31, 2020
(dollars in thousands)	(unaudited)		(unaudited)
Net long TBA notional amount⁽³⁾	$	4,800,000	$	5,197,000
Interest rate swaps notional, utilized to economically hedge interest rate exposure (or duration)	15,221,597		12,646,341
Swaptions net notional, utilized as macroeconomic hedges	—		3,750,000
Total interest rate swaps and swaptions notional	$	15,221,597	$	16,396,341

________________

(3) Accounted for as derivative instruments in accordance with GAAP.

Financing Summary

The following tables summarize the company’s financing metrics and outstanding repurchase agreements, revolving credit facilities, term notes and convertible senior notes as of March 31, 2021 and December 31, 2020:

March 31, 2021	Balance		Weighted Average Borrowing Rate		Weighted Average Months to Maturity	Number of Distinct Counterparties
(dollars in thousands, unaudited)

Repurchase agreements collateralized by RMBS	$	11,676,062	0.24	%	3.29	19
Revolving credit facilities collateralized by MSR and related servicing advance obligations	443,458		3.70	%	10.39	4
Term notes payable collateralized by MSR	395,891		2.91	%	38.86	n/a
Unsecured convertible senior notes	423,337		6.25	%	41.31	n/a
Total borrowings	$	12,938,748
December 31, 2020	Balance		Weighted Average Borrowing Rate		Weighted Average Months to Maturity	Number of Distinct Counterparties
(dollars in thousands, unaudited)

Repurchase agreements collateralized by RMBS	$	15,143,898	0.28	%	1.91	20
Revolving credit facilities collateralized by MSR and related servicing advance obligations	283,830		2.95	%	12.89	3
Term notes payable collateralized by MSR	395,609		2.95	%	41.82	n/a
Unsecured convertible senior notes	286,183		6.25	%	12.53	n/a
Total borrowings	$	16,109,520

Borrowings by Collateral Type	As of March 31, 2021			As of December 31, 2020
(dollars in thousands)	(unaudited)			(unaudited)
Collateral type:
Agency RMBS and Agency Derivatives	$	11,674,486		$	15,141,999
Mortgage servicing rights and related servicing advance obligations	839,349			679,439
Other – secured	1,576			1,899
Other – unsecured⁽¹⁾	423,337			286,183
Total	$	12,938,748		$	16,109,520

Debt-to-equity ratio at period-end⁽²⁾	4.8:1.0			5.2:1.0
Economic debt-to-equity ratio at period-end⁽³⁾	6.4:1.0			6.8:1.0

Cost of Funds Metrics	Three Months Ended March 31, 2021			Three Months Ended December 31, 2020
	(unaudited)			(unaudited)
Annualized cost of funds on average borrowings during the quarter:	0.6		%	0.6		%
Agency RMBS and Agency Derivatives	0.3		%	0.3		%
Mortgage servicing rights and related servicing advance obligations⁽⁴⁾	3.9		%	3.9		%
Other – secured	2.1		%	2.4		%
Other – unsecured⁽¹⁾⁽⁴⁾	6.8		%	6.8		%

____________________

(1)		Unsecured convertible senior notes.
(2)		Defined as total borrowings to fund RMBS, MSR and Agency Derivatives, divided by total equity.
(3)		Defined as total borrowings to fund RMBS, MSR and Agency Derivatives, plus the implied debt on net TBA positions, divided by total equity.
(4)		Includes amortization of debt issuance costs.

Conference Call

Two Harbors Investment Corp. will host a conference call on May 6, 2021 at 9:00 a.m. EDT to discuss first quarter 2021 financial results and related information. To participate in the teleconference, please call toll-free 800-263-0877, conference code 5273239, approximately 10 minutes prior to the above start time. You may also listen to the teleconference live via the Internet on the company’s website at www.twoharborsinvestment.com in the Investors section under the Events and Presentations link. For those unable to attend, a telephone playback will be available beginning at 12:00 p.m. EDT on May 6, 2021, through 12:00 a.m. EDT on June 5, 2021. The playback can be accessed by calling 888-203-1112, conference code 5273239. The call will also be archived on the company’s website in the Investors section under the Events and Presentations link.

Two Harbors Investment Corp.

Two Harbors Investment Corp., a Maryland corporation, is an internally managed real estate investment trust that invests in residential mortgage-backed securities, mortgage servicing rights and other financial assets. Two Harbors is headquartered in Minnetonka, MN. Additional information is available at www.twoharborsinvestment.com.

Forward-Looking Statements

This presentation includes “forward-looking statements” within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Actual results may differ from expectations, estimates and projections and, consequently, readers should not rely on these forward-looking statements as predictions of future events. Words such as “expect,” “target,” “assume,” “estimate,” “project,” “budget,” “forecast,” “anticipate,” “intend,” “plan,” “may,” “will,” “could,” “should,” “believe,” “predicts,” “potential,” “continue,” and similar expressions are intended to identify such forward-looking statements. These forward-looking statements involve significant risks and uncertainties that could cause actual results to differ materially from expected results, including, among other things, those described in our Annual Report on Form 10-K for the year ended December 31, 2020, and any subsequent Quarterly Reports on Form 10-Q, under the caption “Risk Factors.” Factors that could cause actual results to differ include, but are not limited to: the state of credit markets and general economic conditions; the ongoing impact of the COVID-19 pandemic, and the actions taken by federal and state governmental authorities and GSEs in response, on the U.S. economy, financial markets and our target assets; changes in interest rates and the market value of our assets; changes in prepayment rates of mortgages underlying our target assets; the rates of default or decreased recovery on the mortgages underlying our target assets; declines in home prices; our ability to establish, adjust and maintain appropriate hedges for the risks in our portfolio; the availability and cost of our target assets; the availability and cost of financing; changes in the competitive landscape within our industry; our ability to effectively execute and to realize the benefits of strategic transactions and initiatives we have pursued or may in the future pursue; our decision to terminate our management agreement with PRCM Advisers LLC and the ongoing litigation with PRCM Advisers related to such termination; our ability to manage various operational risks and costs associated with our business; interruptions in or impairments to our communications and information technology systems; our ability to acquire (MSR) and successfully operate our seller-servicer subsidiary and oversee our subservicers; the impact of any deficiencies in the servicing or foreclosure practices of third parties and related delays in the foreclosure process; our exposure to legal and regulatory claims; legislative and regulatory actions affecting our business; the impact of new or modified government mortgage refinance or principal reduction programs; our ability to maintain our REIT qualification; and limitations imposed on our business due to our REIT status and our exempt status under the Investment Company Act of 1940.

Readers are cautioned not to place undue reliance upon any forward-looking statements, which speak only as of the date made. Two Harbors does not undertake or accept any obligation to release publicly any updates or revisions to any forward-looking statement to reflect any change in its expectations or any change in events, conditions or circumstances on which any such statement is based. Additional information concerning these and other risk factors is contained in Two Harbors’ most recent filings with the Securities and Exchange Commission (SEC). All subsequent written and oral forward-looking statements concerning Two Harbors or matters attributable to Two Harbors or any person acting on its behalf are expressly qualified in their entirety by the cautionary statements above.

Non-GAAP Financial Measures

In addition to disclosing financial results calculated in accordance with United States generally accepted accounting principles (GAAP), this press release and the accompanying investor presentation present non-GAAP financial measures, such as Core Earnings and Core Earnings per basic common share that exclude certain items. The non-GAAP financial measures presented by the company provide supplemental information to assist investors in analyzing the company’s results of operations and help facilitate comparisons to industry peers. However, because these measures are not calculated in accordance with GAAP, they should not be considered a substitute for, or superior to, the financial measures calculated in accordance with GAAP. The company’s GAAP financial results and the reconciliations from these results should be carefully evaluated. See the GAAP to non-GAAP reconciliation table on page 11 of this release.

Additional Information

Stockholders of Two Harbors and other interested persons may find additional information regarding the company at the SEC’s Internet site at www.sec.gov or by directing requests to: Two Harbors Investment Corp., Attn: Investor Relations, 601 Carlson Parkway, Suite 1400, Minnetonka, MN, 55305, telephone (612) 453-4100.

TWO HARBORS INVESTMENT CORP.
CONDENSED CONSOLIDATED BALANCE SHEETS
(dollars in thousands, except share data)
	March 31, 2021			December 31, 2020
	(unaudited)
ASSETS
Available-for-sale securities, at fair value (amortized cost $11,067,188 and $14,043,175, respectively; allowance for credit losses $18,170 and $22,528, respectively)	$	11,473,390		$	14,650,922
Mortgage servicing rights, at fair value	2,091,761			1,596,153
Cash and cash equivalents	1,159,306			1,384,764
Restricted cash	812,654			1,261,667
Accrued interest receivable	40,527			47,174
Due from counterparties	60,293			146,433
Derivative assets, at fair value	55,145			95,937
Reverse repurchase agreements	76,000			91,525
Other assets	222,839			241,346
Total Assets	$	15,991,915		$	19,515,921
LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities:
Repurchase agreements	$	11,676,062		$	15,143,898
Revolving credit facilities	443,458			283,830
Term notes payable	395,891			395,609
Convertible senior notes	423,337			286,183
Derivative liabilities, at fair value	16,162			11,058
Due to counterparties	144,270			135,838
Dividends payable	60,384			65,480
Accrued interest payable	11,906			21,666
Other liabilities	99,729			83,433
Total Liabilities	13,271,199			16,426,995
Stockholders’ Equity:
Preferred stock, par value $0.01 per share; 100,000,000 shares authorized and 29,050,000 and 40,050,000 shares issued and outstanding, respectively ($726,250 and $1,001,250 liquidation preference, respectively)	702,550			977,501
Common stock, par value $0.01 per share; 700,000,000 shares authorized and 273,718,537 and 273,703,882 shares issued and outstanding, respectively	2,737			2,737
Additional paid-in capital	5,165,683			5,163,794
Accumulated other comprehensive income	370,148			641,601
Cumulative earnings	1,265,913			1,025,756
Cumulative distributions to stockholders	(4,786,315		)	(4,722,463		)
Total Stockholders’ Equity	2,720,716			3,088,926
Total Liabilities and Stockholders’ Equity	$	15,991,915		$	19,515,921

TWO HARBORS INVESTMENT CORP.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(dollars in thousands)
Certain prior period amounts have been reclassified to conform to the current period presentation
	Three Months Ended March 31,
	2021			2020
	(unaudited)
Interest income:
Available-for-sale securities	$	55,652		$	248,684
Other	457			6,823
Total interest income	56,109			255,507
Interest expense:
Repurchase agreements	8,470			152,605
Revolving credit facilities	4,695			3,531
Term notes payable	3,211			4,804
Convertible senior notes	6,350			4,776
Federal Home Loan Bank advances	—			1,592
Total interest expense	22,726			167,308
Net interest income	33,383			88,199
Other income (loss):
Gain (loss) on investment securities	132,868			(1,081,607		)
Servicing income	107,119			130,797
Gain (loss) on servicing asset	327,438			(586,665		)
Loss on interest rate swap and swaption agreements	(15,599		)	(250,596		)
Loss on other derivative instruments	(276,011		)	(133,468		)
Other (loss) income	(5,742		)	798
Total other income (loss)	270,073			(1,920,741		)
Expenses:
Management fees	—			14,550
Servicing expenses	24,947			19,905
Compensation and benefits	8,188			8,277
Other operating expenses	7,487			6,801
Restructuring charges	—			719
Total expenses	40,622			50,252
Income (loss) before income taxes	262,834			(1,882,794		)
Provision for (benefit from) income taxes	22,677			(13,138		)
Net income (loss)	240,157			(1,869,656		)
Dividends on preferred stock	17,216			18,950
Net income (loss) attributable to common stockholders	$	222,941		$	(1,888,606	)
Basic earnings (loss) per weighted average common share	$	0.81		$	(6.91	)
Diluted earnings (loss) per weighted average common share	$	0.74		$	(6.91	)
Dividends declared per common share	$	0.17		$	—
Weighted average number of shares of common stock:
Basic	273,710,765			273,392,615
Diluted	311,465,060			273,392,615

TWO HARBORS INVESTMENT CORP.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS, CONTINUED
(dollars in thousands)
Certain prior period amounts have been reclassified to conform to the current period presentation
	Three Months Ended March 31,
	2021			2020
	(unaudited)
Comprehensive loss:
Net income (loss)	$	240,157		$	(1,869,656	)
Other comprehensive loss, net of tax:
Unrealized loss on available-for-sale securities	(271,453		)	(198,070		)
Other comprehensive loss	(271,453		)	(198,070		)
Comprehensive loss	(31,296		)	(2,067,726		)
Dividends on preferred stock	17,216			18,950
Comprehensive loss attributable to common stockholders	$	(48,512	)	$	(2,086,676	)

TWO HARBORS INVESTMENT CORP.
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL INFORMATION
(dollars in thousands, except share data)
Certain prior period amounts have been reclassified to conform to the current period presentation
	Three Months Ended March 31,			Three Months Ended December 31,
	2021			2020
	(unaudited)			(unaudited)
Reconciliation of Comprehensive (loss) income to Core Earnings:
Comprehensive (loss) income attributable to common stockholders	$	(48,512	)	$	113,481
Adjustment for other comprehensive loss attributable to common stockholders:
Unrealized loss on available-for-sale securities	271,453			78,739
Net income attributable to common stockholders	$	222,941		$	192,220

Adjustments for non-Core Earnings:
Realized gain on securities	(69,194		)	(52,082		)
Unrealized (gain) loss on securities	(62,539		)	10,210
(Reversal of) provision for credit losses	(1,135		)	4,509
Realized and unrealized gain on mortgage servicing rights	(390,704		)	(61,968		)
Realized loss on termination or expiration of swaps and swaptions	6,350			2,546
Unrealized loss on interest rate swaps and swaptions	10,899			14,096
Loss (gain) on other derivative instruments	294,952			(37,752		)
Other loss (income)	5,817			(399		)
Change in servicing reserves	661			1,591
Non-cash equity compensation expense	1,790			2,243
Other nonrecurring expenses	1,971			1,541
Change in restructuring charges	—			(294		)
Net provision for income taxes on non-Core Earnings	24,021			5,546
Core Earnings attributable to common stockholders⁽¹⁾	$	45,830		$	82,007

Weighted average basic common shares	273,710,765			273,699,079
Core Earnings attributable to common stockholders per weighted average basic common share	$	0.17		$	0.30

(1)

Core Earnings is a non-U.S. GAAP measure that we define as comprehensive loss attributable to common stockholders, excluding “realized and unrealized gains and losses” (impairment losses, provision for credit losses, realized and unrealized gains and losses on the aggregate portfolio, reserve expense for representation and warranty obligations on MSR, non-cash compensation expense related to restricted common stock, other nonrecurring expenses and restructuring charges). As defined, Core Earnings includes net interest income, accrual and settlement of interest on derivatives, dollar roll income on TBAs, servicing income, net of estimated amortization on MSR, management fees and recurring cash related operating expenses. Dollar roll income is the economic equivalent to holding and financing Agency RMBS using short-term repurchase agreements. Core Earnings provides supplemental information to assist investors in analyzing the Company’s results of operations and helps facilitate comparisons to industry peers.

TWO HARBORS INVESTMENT CORP.
SUMMARY OF QUARTERLY CORE EARNINGS
(dollars in millions, except per share data)
Certain prior period amounts have been reclassified to conform to the current period presentation

	Three Months Ended
	March 31, 2021			December 31, 2020			September 30, 2020			June 30, 2020			March 31, 2020
	(unaudited)
Net Interest Income:
Interest income	$	56.1		$	72.5		$	89.7		$	107.3		$	255.5
Interest expense	22.7			22.6			29.2			62.1			167.3
Net interest income	33.4			49.9			60.5			45.2			88.2
Other income:
Servicing income, net of amortization⁽¹⁾	43.9			41.1			42.2			51.0			55.2
Interest spread on interest rate swaps	1.7			2.0			0.8			(56.3		)	(12.6		)
Gain on other derivative instruments	18.9			43.5			32.9			11.9			5.3
Other income	0.1			0.1			0.1			0.1			0.1
Total other income	64.5			86.7			76.0			6.7			48.0
Expenses	36.2			37.3			43.5			46.8			47.0
Core Earnings before income taxes	61.7			99.3			93.0			5.1			89.2
Income tax (benefit) expense	(1.3		)	(1.7		)	(1.5		)	0.6			2.6
Core Earnings	63.0			101.0			94.5			4.5			86.6
Dividends on preferred stock	17.2			19.0			18.9			19.0			19.0
Core Earnings attributable to common stockholders⁽²⁾	$	45.8		$	82.0		$	75.6		$	(14.5	)	$	67.6
Weighted average basic Core EPS	$	0.17		$	0.30		$	0.28		$	(0.05	)	$	0.25

Core earnings return on average common equity	8.8		%	15.9		%	15.7		%	(3.1		)%	7.3		%

________________

(1)		Amortization refers to the portion of change in fair value of MSR primarily attributed to the realization of expected cash flows (runoff) of the portfolio. This amortization has been deducted from Core Earnings. Amortization of MSR is deemed a non-GAAP measure due to the company’s decision to account for MSR at fair value.
(2)		Please see page 11 for a definition of Core Earnings and a reconciliation of GAAP to non-GAAP financial information.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210505006104/en/

Paulina Sims, Senior Director, Investor Relations, Two Harbors Investment Corp., (612)-446-5431,

[email protected]

KEYWORDS: United States North America New York

INDUSTRY KEYWORDS: Construction & Property REIT

MEDIA:

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May 5, 2021 4:40 pm

NL REPORTS FIRST QUARTER 2021 RESULTS

Dallas, Texas, May 05, 2021 (GLOBE NEWSWIRE) — NL Industries, Inc. (NYSE: NL) today reported net income attributable to NL stockholders of $13.3 million, or $.27 per share, in the first quarter of 2021 compared to net income attributable to NL stockholders of $1.9 million, or $.04 per share, in the first quarter of 2020. NL results include an unrealized gain of $6.4 million in the first quarter of 2021 related to the change in value of marketable equity securities compared to an unrealized loss of $12.1 million in the first quarter of 2020.

CompX net sales were $35.9 million in the first quarter of 2021 compared to $32.3 million in the first quarter of 2020. CompX net sales increased primarily due to higher Marine Component sales to the towboat market and to a lesser extent higher Security Products sales. Marine Components continues to benefit from an overall increase in demand in the recreational marine market which began in late spring 2020. Income from operations attributable to CompX increased to $5.8 million in the first quarter of 2021 compared to $5.0 million in the first quarter of 2020 due to the higher Marine Components sales as well as lower overall medical expenses, partially offset by higher costs of sales at Security Products.

NL recognized equity in earnings of Kronos of $6.0 million in the first quarter of 2021 compared to $8.2 million in the first quarter of 2020. Kronos’ net sales of $465.0 million in the first quarter of 2021 were $44.0 million, or 10% higher than in the first quarter of 2020 primarily due to higher sales volumes partially offset by lower average TiO₂selling prices. Kronos’ TiO₂sales volumes were 3% higher in the first quarter of 2021 as compared to the first quarter of 2020 primarily due to higher demand in its North American and Latin American markets, partially offset by lower demand in its European market. Kronos’ average TiO₂ selling prices were 1% lower in the first quarter of 2021 as compared to the first quarter of 2020. Kronos’ average TiO₂ selling prices at the end of the first quarter of 2021 were 1% higher than its average TiO₂ selling prices at the end of 2020. Fluctuations in currency exchange rates (primarily the euro) also affected net sales comparisons, increasing net sales by approximately $20 million in the first quarter of 2021 compared to the first quarter of 2020. The table at the end of this press release shows how each of these items impacted the overall change in Kronos’ net sales.

Kronos’ income from operations in the first quarter of 2021 was $34.0 million as compared to $43.5 million in the first quarter of 2020. Kronos’ income from operations decreased in the first quarter of 2021 compared to the first quarter of 2020 primarily due to lower income from operations resulting from the net effects of fluctuations in currency exchange rates, which decreased income from operations by approximately $16 million in the first quarter of 2021 as compared to the first quarter of 2020, lower average TiO₂ selling prices, higher sales volumes and lower production costs. Due to the phase-out of sulfate production at one of Kronos’ facilities in the fourth quarter of 2020, Kronos’ TiO₂ production volumes were 1% lower in the first quarter of 2021 as compared to the first quarter of 2020. Kronos operated its production facilities at overall average capacity utilization rates of 97% and 95% in the first quarters of 2021 and 2020, respectively.

Kronos’ other income (expense) in the first quarter of 2020 includes a pre-tax insurance settlement gain of $1.5 million (NL’s equity interest was $.4 million, or $.01 per share, net of income tax expense) related to a property damage claim.

Corporate expenses decreased $.7 million in the first quarter of 2021 compared to the first quarter of 2020 primarily due to lower litigation fees and related costs and lower administrative expenses. Interest and dividend income decreased $.7 million in the first quarter of 2021 compared to the first quarter of 2020 primarily due to lower dividend income and lower interest income related to lower average interest rates on invested balances and lower average interest rates, and to a lesser extent lower average outstanding balances, under CompX’s revolving promissory note receivable from Valhi. Marketable equity securities represent the change in unrealized gains (losses) on our portfolio of marketable equity securities during the periods.

The statements in this release relating to matters that are not historical facts are forward-looking statements that represent management’s beliefs and assumptions based on currently available information. Although we believe the expectations reflected in such forward-looking statements are reasonable, we cannot give any assurances that these expectations will prove to be correct. Such statements by their nature involve substantial risks and uncertainties that could significantly impact expected results, and actual future results could differ materially from those described in such forward-looking statements. While it is not possible to identify all factors, we continue to face many risks and uncertainties. Factors that could cause actual future results to differ materially include, but are not limited to:

Future supply and demand for our products
The extent of the dependence of certain of our businesses on certain market sectors
The cyclicality of our businesses (such as Kronos’ TiO₂operations)
Customer and producer inventory levels
Unexpected or earlier-than-expected industry capacity expansion (such as the TiO₂industry)
Changes in raw material and other operating costs (such as energy, ore, zinc, aluminum, steel and brass costs) and our ability to pass those costs on to our customers or offset them with reductions in other operating costs
Changes in the availability of raw material (such as ore)
General global economic and political conditions that harm the worldwide economy, disrupt our supply chain, increase material costs or reduce demand or perceived demand for Kronos’ TiO₂ and our products or impair our ability to operate our facilities (including changes in the level of gross domestic product in various regions of the world, natural disasters, terrorist acts, global conflicts and public health crises such as COVID-19)
Competitive products and substitute products
Price and product competition from low-cost manufacturing sources (such as China)
Customer and competitor strategies
Potential consolidation of Kronos’ competitors
Potential consolidation of Kronos’ customers
The impact of pricing and production decisions
Competitive technology positions
Our ability to protect or defend intellectual property rights
Potential difficulties in integrating future acquisitions
Potential difficulties in upgrading or implementing accounting and manufacturing software systems
The introduction of trade barriers or trade disputes
The impact of current or future government regulations (including employee healthcare benefit related regulations)
Fluctuations in currency exchange rates (such as changes in the exchange rate between the U.S. dollar and each of the euro, the Norwegian krone and the Canadian dollar and between the euro and the Norwegian krone), or possible disruptions to our business resulting from uncertainties associated with the euro or other currencies
Operating interruptions (including, but not limited to, labor disputes, leaks, natural disasters, fires, explosions, unscheduled or unplanned downtime, transportation interruptions, cyber-attacks and public health crises such as COVID-19)
Decisions to sell operating assets other than in the ordinary course of business
Kronos’ ability to renew or refinance credit facilities
Our ability to maintain sufficient liquidity
The timing and amounts of insurance recoveries
The ability of our subsidiaries or affiliates to pay us dividends
Uncertainties associated with CompX’s development of new products and product features
The ultimate outcome of income tax audits, tax settlement initiatives or other tax matters, including future tax reform
Our ability to utilize income tax attributes or changes in income tax rates related to such attributes, the benefits of which may or may not have been recognized under the more-likely-than-not recognition criteria
Environmental matters (such as those requiring compliance with emission and discharge standards for existing and new facilities or new developments regarding environmental remediation at sites related to our former operations)
Government laws and regulations and possible changes therein (such as changes in government regulations which might impose various obligations on former manufacturers of lead pigment and lead-based paint, including us, with respect to asserted health concerns associated with the use of such products), including new environmental health and safety regulations such as those seeking to limit or classify TiO₂or its use
The ultimate resolution of pending litigation (such as our lead pigment and environmental matters)
Possible future litigation.

Should one or more of these risks materialize (or the consequences of such a development worsen), or should the underlying assumptions prove incorrect, actual results could differ materially from those currently forecasted or expected. We disclaim any intention or obligation to update or revise any forward-looking statement whether as a result of changes in information, future events or otherwise.

NL Industries, Inc. is engaged in component products (security products and recreational marine components) and chemicals (TiO₂) businesses.

NL INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In millions, except earnings per share)

	Three months ended
	March 31,
	2020			2021
	(unaudited)
Net sales	$	32.3		$	35.9
Cost of sales		21.9			24.9

Gross margin		10.4			11.0

Selling, general and administrative expense		5.4			5.2

Corporate expense		2.5			1.8

Income from operations		2.5			4.0

Equity in earnings of Kronos Worldwide, Inc.		8.2			6.0

Other income (expense):
Interest and dividend income		1.1			.4
Marketable equity securities		(12.1	)		6.4
Other components of net periodic pension and OPEB cost		(.2	)		(.1	)
Interest expense		(.3	)		(.3	)

Income (loss) before income taxes		(.8	)		16.4

Income tax expense (benefit)		(3.3	)		2.5

Net income		2.5			13.9

Noncontrolling interest in net income of subsidiary		.6			.6

Net income attributable to NL stockholders	$	1.9		$	13.3

Net income per share attributable to NL stockholders	$	.04		$	.27

Weighted average shares used in the calculation
of net income per share		48.8			48.8

NL INDUSTRIES, INC.

COMPONENTS OF INCOME FROM OPERATIONS

(In millions)

(unaudited)

	Three months ended
	March 31,
	2020			2021

CompX – component products	$	5.0		$	5.8
Corporate expense		(2.5	)		(1.8	)

Income from operations	$	2.5		$	4.0

CHANGE IN KRONOS’ TiO₂ SALES

(unaudited)

	Three months ended
	March 31,
	2021 vs. 2020

Percentage change in net sales:
TiO₂ sales volume		3		%
TiO₂ product pricing		(1	)
TiO₂ product mix/other		3
Changes in currency exchange rates		5

Total		10		%

SOURCE:  NL Industries, Inc.
CONTACT:  Janet G. Keckeisen, Vice President - Corporate Strategy and Investor Relations, 972.233.1700

May 5, 2021 4:40 pm

Invacare Reports Results for First Quarter 2021

Invacare Reports Results for First Quarter 2021

Strengthening demand expected to drive 2Q21 revenue growth

Reaffirms full year 2021 financial guidance

Increased balance sheet flexibility with the completion of convertible debt transaction

ELYRIA, Ohio–(BUSINESS WIRE)–
Invacare Corporation (NYSE: IVC) (“Invacare” or the “company”) today reported results for the quarter ended March 31, 2021.

Key Metrics (1Q21 versus 1Q20*)

Reported net sales decreased 10.2% to $196.2 million, and constant currency net sales^(a), which excludes the 1Q20 Dynamic Controls divestiture, decreased 14.2%.
- Prior year first quarter performance was not impacted by the pandemic.
- Revenue growth in respiratory products was more than offset by lower sales of mobility and seating and lifestyle products, which continue to be impacted by the pandemic, as well as supply chain disruptions which hampered order fulfillment during the quarter.
Gross profit as a percent of net sales was 27.8%, a decrease of 100 basis points, attributable to unfavorable manufacturing variances due to supply chain and logistics challenges which temporarily delayed revenues and inefficiencies associated with disrupted production.
Reported SG&A expense improved by $2.9 million, or 4.7%, and constant currency SG&A^(b) improved by $5.1 million, or 8.4%, driven primarily by reduced employment costs, lower commercial expenses including reduced commissions on lower net sales.
Operating loss was $5.7 million, a decline of $15.2 million, due to lower gross profit as a result of reduced net sales partially offset by reduced SG&A expenses.
- Prior year operating profit included a gain of $9.6 million from the divestiture of Dynamic Controls.
Adjusted EBITDA^(d) was $1.5 million, a decline of $4.4 million, due to reduced gross profit on lower sales offset by lower SG&A expense.
Free cash flow^(e) usage was $17.9 million, an increase of $5.9 million. 1Q21 usage included the funding of $8 million one-time payments related to severance costs for German plant consolidation and value added tax payments deferred from 2020, which were previously disclosed, and increases to inventory.

* Date format is quarter and year in each instance

Key Financial Results (1Q21 versus 1Q20)

(in millions USD)	1Q21	1Q20	$ Change Fav/(Unfav)	% Change Fav/(Unfav)
Net Sales	$196.2	$218.4	$(22.2)	(10.2)%
Constant Currency Net Sales ⁽¹⁾	$185.1	$215.6	$(30.5)	(14.2)%
Gross Profit	$54.6	$63.0	$(8.4)	(13.3)%
Gross Profit % of Net Sales	27.8%	28.8%		(100 bps)
SG&A	$58.8	$61.7	$2.9	4.7%
Constant Currency SG&A ⁽¹⁾	$55.8	$60.9	$5.1	8.4%
Operating Income (Loss)	$(5.7)	$9.4	$(15.2)	—
Adjusted EBITDA	$1.5	$5.9	$(4.4)	(74.8)%
Free Cash Flow Usage	$(17.9)	$(12.0)	$(5.9)	(49.3)%

⁽¹⁾ Based on 1Q20 FX rates

Executive Summary

Commenting on 1Q21 results, Matt Monaghan, chairman, president, and chief executive officer, said “We entered 2021 with strong demand for lifestyle and respiratory products and strengthening demand for mobility & seating products. We see these trends continuing into the second quarter. Despite good demand, our first quarter revenues were lower by approximately $15 million of firm orders which didn’t ship and become revenue in the quarter as a result of various supply chain disruptions, which impacted all regions. Component delays and parts shortages prevented the timely delivery of confirmed orders and led to a higher than typical backlog, with the additional backlog expected to convert to net sales within the next two quarters. As our team continues to rise to the challenge of supporting our customers globally, we will mitigate further disruptions by investing in additional inventory in the short-term.

Looking forward, I am encouraged as our healthy order book, high backlog, and early second quarter indicators demonstrate that demand remains strong, further establishing that the revenue decline in 1Q21 was temporary in nature. Based on revenues to date through April 2021 and projecting those trends for the full quarter, we anticipate constant currency net sales growth in the mid-single digit range for 2Q21 compared to the prior year. As pandemic related restrictions ease and supply chain disruptions subside, we anticipate significant improvement in our results during the second half of the year, driven by strengthening demand for our products, backlog reduction, fulfillment of pent-up demand, and increased adoption of compelling new products.

In addition, we were pleased to have opportunistically completed a debt transaction during the quarter which strengthened our balance sheet, providing a clear runway to execute our growth strategy for the next few years. As a result, we have continued confidence in our ability to achieve our previously disclosed full year guidance for net sales, Adjusted EBITDA, and free cash flow.”

Commenting on the company’s financial results, Kathy Leneghan, senior vice president and chief financial officer stated, “Free cash flow usage in the quarter was in line with 1Q20, with the consideration of funding one-time items as previously discussed. The company did a great job managing working capital to offset delayed sales impacted by supply chain disruptions. We also increased our financial flexibility with the issuance of new convertible notes which allowed us to retire nearly all of our 2022 debt and extend the overall debt maturity profile to 2026.”

Reaffirms Full Year 2021 Guidance

The company reaffirms its financial guidance for the full year 2021 consisting of:

Constant currency net sales growth in the range of 4% to 7%;
Adjusted EBITDA improvement of 41%, to $45 million; and,
Free cash flow of $5 million.

The company expects restoration of access to healthcare, normalization of the global supply chain, and fulfillment of its excess order backlog, which was elevated at the end of 1Q21, will yield improved financial performance with growth in revenue, profitability and free cash flow for the year.

Based on revenue to date through April 2021 and projecting those trends for the full quarter, constant currency net sales are anticipated to increase in the mid-single digit range for 2Q21 compared to the prior year, as well as improve sequentially throughout the year. This increase is driven by positive trends in each of the segments as order intake continues to strengthen and a portion of the elevated backlog has been shipped and billed to customers. Additionally, the volume and value of mobility and seating quotes in North America are showing clear signs of improvement, a key indicator for future period growth.

1Q21 Segment Results versus 1Q20

(in millions USD)	Net Sales								Operating Income (Loss)
	1Q21		1Q20		Reported % Change		Constant Currency % Change		1Q21			1Q20			% Change
Europe	$	112.8	$	121.0	(6.8	)%	(14.8	)%	$	3.8		$	6.9		(44.1	)%
North America	76.0		87.0		(12.6	)	(13.1	)	(2.4		)	(2.0		)	(16.1	)
All Other	7.5		10.5		(29.0	)	(16.4	)	(5.6		)	(3.6		)	(58.6	)

Globally, net sales continued to be impacted by the pandemic with public health restrictions in certain countries continuing to limit access to healthcare professionals and institutions needed for certain product selections. 1Q20 financial performance was not impacted by the pandemic. In addition, supply chain disruptions related to transportation and logistics, and parts shortages delayed receipt of components which limited conversion of orders to shipments in the quarter.

Europe – Constant currency net sales decreased 14.8% with lower sales of mobility and seating and lifestyle products partially offset by growth in respiratory products. This revenue decline is less than the declines experienced in 2Q20 and 3Q20 as a result of limitations in healthcare access but also impacted by supply chain disruptions noted above. Gross profit declined by $4.0 million, or 160 basis points, due to reduced net sales and unfavorable operational variances. Operational variances were impacted by supply chain disruptions which impacted volume in the company’s assembly locations. Operating income was $3.8 million, a decrease of $3.0 million, due to reduced gross profit as result of lower net sales partially offset by reduced SG&A expense.

North America – Constant currency net sales decreased 13.1% with higher sales of respiratory products more than offset by lower sales of mobility and seating and lifestyle products. This revenue decline is higher than experienced for mobility & seating and lifestyle products in 2Q20 and 3Q20 impacted by supply chain disruptions and continued limitation to healthcare access, including long-term care facilities. Gross profit as a percentage of sales was flat, while gross profit declined $3.9 million driven by lower revenues and unfavorable manufacturing variances, partially offset by favorable product mix and lower material costs. Operating loss increased by $0.3 million primarily due to reduced gross profit on lower net sales offset by lower SG&A expense.

All Other– Constant currency net sales in the Asia Pacific region decreased 16.4% due to lower sales of lifestyle products partially offset by growth in mobility and seating products. Operating loss for All Other increased $2.1 million primarily as a result of lower profitability in the Asia Pacific business impacted by lower net sales, unfavorable foreign currency transactions and the divestiture of Dynamic Controls in 1Q20. Corporate All Other expenses increased primarily related to stock compensation expense.

Financial Condition

The company’s cash and cash equivalents balances were $86.1 million and $105.3 million at March 31, 2021, and December 31, 2020, respectively. The change was primarily the result of cash used for operating activities and capital expenditures. Financing activities during 1Q21 resulted in a net use of cash of $2.5 million which included net proceeds from the completion of a convertible debt offering offset by debt payments related to the repayment and retirement of 2021 and 2022 convertible debt as well as repayments of borrowings under the company’s ABL credit facilities.

Free cash flow usage in 1Q21 was $17.9 million, unfavorable by $5.9 million as compared to 1Q20 due to the funding of one-time payments related to the German plant consolidation ($5.0 million) and value added tax payments deferred from 2020 ($2.8 million), which were previously disclosed. Free cash flow usage for 1Q21 funded operating activities supporting working capital needs, primarily in inventories and accrued expenses partially offset by lower accounts receivable. 1Q21 inventory levels were elevated as a result of supply chain disruptions which increased goods-in-transit and created a higher backlog of certain components which could not be converted into complete products.

Conference Call and Webcast

As previously announced, the company will provide a conference call and webcast for investors and other interested parties to review its first quarter 2021 financial results on Thursday, May 6, 2021 at 8:30 AM ET. Those wishing to participate in the live call should dial 888-394-8218, or for international callers 786-789-4776, and enter Conference ID 2946784. A simultaneous webcast of the call will be accessible at https://ctevents.webex.com/ctevents/onstage/g.php?MTID=e548c01978e3d9562b119968f68aae878. A copy of the webcast slide deck will be posted to www.invacare.com/investorrelations prior to the webcast.

A recording of the conference call can be accessed by dialing 888-203-1112 (U.S. and Canada) or 719-457-0820 (international callers) and entering the Conference ID Code 2946784 and PIN 8398, through May 13, 2021. An archive of the webcast presentation will be posted at www.invacare.com/investorrelations 24 hours after the call.

Upcoming Investor Events

May 25, 2021 – UBS Global Healthcare Conference (virtual)
June 16, 2021 – IDEAS Investor Conference (virtual)

About Invacare Corporation

Invacare Corporation (NYSE: IVC) (“Invacare” or the “company”) is a leading manufacturer and distributor in its markets for medical equipment used in non-acute care settings. At its core, the company designs, manufactures and distributes medical devices that help people to move, breathe, rest, and perform essential hygiene. The company provides clinically complex medical device solutions for congenital (e.g., cerebral palsy, muscular dystrophy, spina bifida), acquired (e.g., stroke, spinal cord injury, traumatic brain injury, post-acute recovery, pressure ulcers) and degenerative (e.g., ALS, multiple sclerosis, chronic obstructive pulmonary disease (COPD), elderly, bariatric) ailments. The company’s products are important parts of care for people with a wide range of challenges, from those who are active and involved in work or school each day and may need additional mobility or respiratory support, to those who are cared for in residential care settings, at home and in rehabilitation centers. The company sells its products principally to home medical equipment providers with retail and e-commerce channels, residential care operators, distributors, and government health services in North America, Europe, and Asia Pacific. For more information about the company and its products, visit Invacare’s website at www.invacare.com.

This press release contains forward-looking statements within the meaning of the “Safe Harbor” provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are those that describe future outcomes or expectations that are usually identified by words such as “will,” “should,” “could,” “plan,” “intend,” “expect,” “continue,” “forecast,” “believe,” and “anticipate” and include, for example, statements related to the expected effects on the company’s business of the COVID-19 pandemic; sales and free cash flow trends; the impact of contingency plans and cost containment actions; the company’s liquidity and working capital expectations; the company’s future financial results; and similar statements. Actual results may differ materially as a result of various risks and uncertainties, including the duration and scope of the COVID-19 pandemic, the resumption of access to healthcare, including clinics and elective care, and loosening of public health restrictions, or any reimposed restrictions on access to healthcare or tightening of public health restrictions and impact on the demand for the company’s products; the ability of the company to obtain needed raw materials and components from its suppliers; actions that governments, businesses and individuals take in response to the pandemic, including mandatory business closures and restrictions on onsite commercial interactions; the impact of the pandemic and actions taken in response to the pandemic on global and regional economies and economic activity; the pace of recovery when the COVID-19 pandemic subsides; general economic uncertainty in key global markets and a worsening of global economic conditions or low levels of economic growth; the effects of steps the company takes to reduce operating costs; the inability of the company to sustain profitable sales growth, achieve anticipated improvements in segment operating performance, convert high inventory or accounts receivable levels to cash or reduce its costs to maintain competitive prices for its products; lack of market acceptance of the company’s new product innovations; circumstances or developments that may make the company unable to implement or realize the anticipated benefits, or that may increase the costs, of its current and planned business initiatives, such as its new product introductions, commercialization plans, additional investments in sales force and demonstration equipment, product distribution strategy in Europe, supply chain actions and global information technology outsourcing and ERP implementation activities; possible adverse effects on the company’s liquidity, including the company’s ability to address future debt maturities; adverse changes in government and third-party payor reimbursement levels and practices in the U.S.; adverse impacts of new tariffs or increases in commodity prices or freight and logistics costs; regulatory proceedings or the company’s failure to comply with regulatory requirements or receive regulatory clearance or approval for the company’s products or operations; adverse effects of regulatory or governmental inspections of the company’s facilities at any time and governmental investigations or enforcement actions; exchange rate fluctuations; and those other risks and uncertainties expressed in the cautionary statements and risk factors in the company’s annual report on Form 10-K, quarterly reports on Form 10-Q and other filings with the Securities and Exchange Commission. The company may not be able to predict and may have little or no control over many factors or events that may influence its future results and, except as required by law, shall have no obligation to update any forward-looking statements.

INVACARE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF INCOME (LOSS) – (UNAUDITED)

(In thousands, except per share data)	Three Months Ended
	March 31
	2021			2020
Net sales	$	196,202		$	218,440
Cost of products sold	141,564			155,452
Gross Profit	54,638			62,988
Selling, general and administrative expenses	58,821			61,738
Gain on sale of business	—			(9,590		)
Charges related to restructuring activities	1,552			1,392
Operating Income (Loss)	(5,735		)	9,448
Loss on debt extinguishment including debt finance charges and fees	709			—
Interest expense – net	5,730			6,616
Earnings (Loss) Before Income Taxes	(12,174		)	2,832
Income tax provision	1,870			2,100
Net Income (Loss)	(14,044		)	732

Net Income (Loss) per Share—Basic	$	(0.41	)	$	0.02

Weighted Average Shares Outstanding—Basic	34,495			33,784

Net Income (Loss) per Share—Assuming Dilution *	$	(0.41	)	$	0.02

Weighted Average Shares Outstanding—Assuming Dilution	35,210			33,853

__________

* Net loss per share assuming dilution calculated using weighted average shares outstanding – basic for periods in which there is a loss.

INVACARE CORPORATION AND SUBSIDIARIES
RECONCILIATION OF NET INCOME (LOSS) PER SHARE
TO ADJUSTED NET LOSS PER SHARE^(c)

(In thousands, except per share data)	Three Months Ended
	March 31
	2021			2020
Net Income (Loss) per share – assuming dilution*	$	(0.41	)	$	0.02
Weighted average shares outstanding- assuming dilution	34,495			33,853
Net Income (Loss)	(14,044		)	732
Income tax provision	1,870			2,100
Income (Loss) Before Income Taxes	(12,174		)	2,832
Convertible debt discount amortization and accretion	870			2,732
Gain on sale of business	—			(9,590		)
Loss on debt extinguishment including debt finance charges and fees	709			—
Adjusted Loss Before Income Taxes	(10,595		)	(4,026		)
Adjusted Income Taxes	1,870			3,088
Adjusted Net Loss^(f)	$	(12,465	)	$	(7,114	)

Weighted Average Shares Outstanding – Assuming Dilution	34,495			33,784
Adjusted Net Loss per Share^(c) – Assuming Dilution*	$	(0.36	)	$	(0.21	)

__________

“Adjusted net loss per share” and “adjusted net loss” are non-GAAP financial measures, which are defined at the end of this press release.

*Net loss per share assuming dilution and adjusted net loss per share^(c) assuming dilution are calculated using weighted average shares outstanding – basic for periods in which there is a loss.

INVACARE CORPORATION AND SUBSIDIARIES
RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA^(d)
	Three Months Ended
(In thousands)	March 31
	2021			2020
Net Income (Loss)	$	(14,044	)	$	732
Income tax provision	1,870			2,100
Interest expense – net	5,730			6,616
Loss on debt extinguishment including debt finance charges and fees	709			—
Operating Income (Loss)	(5,735		)	9,448
Gain on sale of business	—			(9,590		)
Depreciation and amortization	4,079			3,407
EBITDA	(1,656		)	3,265
Charges related to restructuring activities	1,552			1,392
Stock compensation expense	1,580			1,200
Adjusted EBITDA^(d)	$	1,476		$	5,857

__________

“Adjusted EBITDA^(d)” is a non-GAAP financial measure, which is defined at the end of this press release.

INVACARE CORPORATION AND SUBSIDIARIES

BUSINESS SEGMENTS (UNAUDITED)

The company operates in two primary business segments: North America and Europe with each selling the company’s primary product categories, which includes: lifestyle, mobility and seating and respiratory therapy products. Sales in Asia Pacific, which do not meet the quantitative criteria for determining reportable segments, are reported in All Other and include products similar to those sold in North America and Europe. Intersegment revenue for reportable segments was $19,503,000 for the three months ended March 31, 2021 compared to $27,237,000 for the three months ended March 31, 2020. The accounting principles applied at the operating segment level are generally the same as those applied at the consolidated financial statement level. Intersegment sales are eliminated in consolidation.

The information by segment is as follows:

	Three Months Ended
(In thousands)	March 31
	2021			2020			Change
Revenues from external customers
Europe	$	112,775		$	120,968		$	(8,193	)
North America	75,974			86,971			(10,997		)
All Other (sales in Asia Pacific)	7,453			10,501			(3,048		)
Consolidated	$	196,202		$	218,440		$	(22,238	)

Operating income (loss)
Europe	$	3,832		$	6,850		$	(3,018	)
North America	(2,375		)	(2,045		)	(330		)
All Other	(5,640		)	(3,555		)	(2,085		)
Charge related to restructuring activities	(1,552		)	(1,392		)	(160		)
Gain on sale of business	—			9,590			(9,590		)
Consolidated operating income (loss)	(5,735		)	9,448			(15,183		)
Loss on debt extinguishment including debt finance charges and fees	(709		)	—			(709		)
Net interest expense	(5,730		)	(6,616		)	886
Earnings (loss) before income taxes	$	(12,174	)	$	2,832		$	(15,006	)

__________

“All Other” consists of operating income (loss) associated with the company’s businesses in the Asia Pacific region and unallocated corporate selling, general and administrative (“SG&A”) expenses and intersegment eliminations, which do not meet the quantitative criteria for determining reportable segments.

INVACARE CORPORATION AND SUBSIDIARIES

BUSINESS SEGMENT NET SALES (UNAUDITED)

The following tables provide net sales changes by segment as reported and as adjusted to exclude the impact of foreign exchange translation and divestitures (constant currency net sales^(a)) for the three-month periods referenced below. The current year constant currency net sales are translated using the prior year’s foreign exchange rates. These amounts are then compared to the prior year’s sales to calculate the constant currency net sales change.

Three months ended March 31, 2021 compared to March 31, 2020:

	Reported		Foreign Exchange Translation Impact		Divestiture Impact		Constant Currency
Europe	(6.8	)%	8.0	%	—	%	(14.8	)%
North America	(12.6	)	0.5		—		(13.1	)
All Other (sales in Asia Pacific)	(29.0	)	14.1		(26.7	)	(16.4	)
Consolidated	(10.2	)%	5.3	%	(1.3	)%	(14.2	)%

__________

“Constant currency net sales^(a)” is a non-GAAP financial measure, which is defined at the end of this press release.

INVACARE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED)

(In thousands)	March 31, 2021		December 31, 2020
Assets
Current Assets
Cash and cash equivalents	$	86,052	$	105,298
Trade receivables, net	99,773		108,588
Installment receivables, net	239		379
Inventories, net	132,394		115,484
Other current assets	35,483		44,717
Total Current Assets	353,941		374,466
Other Assets	5,643		5,925
Intangibles, net	28,066		27,763
Property and Equipment, net	57,793		56,243
Finance Lease Assets, net	69,096		64,031
Operating Lease Assets, net	14,053		15,092
Goodwill	407,726		402,461
Total Assets	$	936,318	$	945,981
Liabilities and Shareholders’ Equity
Current Liabilities
Accounts payable	$	93,111	$	85,424
Accrued expenses	112,278		126,273
Current taxes payable	2,470		3,359
Current portion of long-term debt	4,840		5,612
Current portion of finance lease obligations	3,584		3,405
Current portion of operating lease obligations	5,610		6,313
Total Current Liabilities	221,893		230,386
Long-Term Debt	283,750		239,441
Long-Term Obligations – Finance Leases	68,346		63,137
Long-Term Obligations – Operating Leases	8,356		8,697
Other Long-Term Obligations	71,272		70,474
Shareholders’ Equity	282,701		333,846
Total Liabilities and Shareholders’ Equity	$	936,318	$	945,981

INVACARE CORPORATION AND SUBSIDIARIES
RECONCILIATION FROM NET CASH USED BY
OPERATING ACTIVITIES TO FREE CASH FLOW^(e)

	Three Months Ended
(In thousands)	March 31
	2021			2020
Net cash used by operating activities	$	(13,760	)	$	(9,839	)
Plus:
Sales of property and equipment	23			4
Less:
Purchases of property and equipment	(4,118		)	(2,121		)
Free Cash Flow^(e)(usage)	$	(17,855	)	$	(11,956	)

__________

“Free Cash Flow^(e) is a non-GAAP financial measure, which is defined at the end of this press release.

Definitions of Non-GAAP Financial Measures

^(a) “Constant currency net sales” is a non-GAAP financial measure, which is defined as net sales excluding the impact of foreign currency translation and further adjusted to exclude the impact of the sale of Dynamic Controls, which was sold in March 2020 and not deemed a discontinued operation for financial reporting purposes. The current year’s functional constant currency net sales are translated using the prior year’s foreign exchange rates. These amounts are then compared to the prior year’s sales to calculate the constant currency net sales change. The “Business Segments Net Sales” table accompanying this press release compares net sales as reported and net sales excluding the effects of foreign exchange translation by segment and for the consolidated company for the three months ended March 31, 2021 and March 31, 2020, respectively. The company believes that this financial measure provides meaningful information for evaluating the core operating performance of the company. This financial measure is reconciled to the related GAAP financial measures in the “Business Segment Net Sales” table included in this press release.

^(b) “Constant Currency SG&A” is a non-GAAP financial measure, which is defined as selling, general and administrative (“SG&A”) expense excluding the impact of foreign currency translation and further adjusted to exclude the impact of the sale of Dynamic Controls, which was sold in March 2020 and not deemed a discontinued operation for financial reporting purposes. The current period’s functional constant currency SG&A expenses are translated using the prior year’s foreign exchange rates. These amounts are then compared to the prior year’s SG&A expenses to calculate the constant currency SG&A expenses change.

^(c) “Adjusted net loss per share” is a non-GAAP financial measure, which is defined as adjusted net loss^(h) divided by weighted average shares outstanding, assuming dilution. It should be noted that the company’s definition of adjusted net loss per share may not be comparable to similar measures disclosed by other companies because not all companies and financial analysts calculate adjusted net loss per share in the same manner. The company believes that its exclusion adjustments are generally recognized by the industry in which it operates as relevant in computing Adjusted net loss per share as a supplementary non-GAAP financial measure used by financial analysts and others in the company’s industry to meaningfully evaluate operating performance. This financial measure is reconciled to the related GAAP financial measure in the “Reconciliation of Net Income (Loss) Per Share to Adjusted Net Loss per Share” table included in this press release.

^(d) “Adjusted EBITDA” is a non-GAAP financial measure, which is defined as earnings before interest, taxes, depreciation and amortization and calculated as net loss plus: income taxes, interest expense-net, loss on debt extinguishment including debt finance charges and fees, net gain on sale of business, and depreciation and amortization, as further adjusted to exclude charges related to restructuring activities, and share-based compensation expense. It should be noted that the company’s definition of Adjusted EBITDA may not be comparable to similar measures disclosed by other companies because not all companies and financial analysts calculate Adjusted EBITDA in the same manner. The company believes that this financial measure provides meaningful information which is used by financial analysts and others in the company’s industry to evaluate the performance of the company. This financial measure is reconciled to the related GAAP financial measure in the “Reconciliation of Net Income (Loss) to Adjusted EBITDA” table included in this press release.

^(e) “Free cash flow” is a non-GAAP financial measure, which is defined as net cash provided (used) by operating activities less purchases of property and equipment plus proceeds from sales of property and equipment. The company believes that this financial measure provides meaningful information for evaluating the overall financial performance of the company and its ability to repay debt or make future investments. This financial measure is reconciled to the related GAAP financial measure in the “Reconciliation from Net Cash Used by Operating Activities to Free Cash Flow” table included in this press release.

^(f) “Adjusted net loss” is a non-GAAP financial measure, which is defined as net loss before income tax provision and excluding convertible debt discount amortization and accretion recorded in interest expense ($0.9 million for the three months ended March 31, 2021 and $2.7 million for the three months ended March 31, 2020), loss on debt extinguishment including debt finance charges and fees ($0.7 million pre-tax for the three months ended March 31, 2021), gain on sale of business ($9.6 million pre-tax for the three months ended March 31, 2020) and additional adjusted income taxes ($1.0 million for the three months ended March 31, 2020). Adjusted income taxes are computed as taxes as calculated for GAAP then adjusted for an expense or benefit at the statutory rate related to pretax adjustments related to locations without a valuation allowance, the exclusion of uncertain tax liabilities deemed not related to current operations or the exclusion of taxes related to nonrecurring sales of non-inventory product or entities on an intercompany basis as well as the impact from the sale of Dynamic Controls, which was sold in March 2020. (Note: The U.S. is in a full valuation allowance and accordingly, no tax expense adjustments are appropriate related to U.S. pre-tax adjustments.) This financial measure is reconciled to the related GAAP financial measure in the “Reconciliation of Net Income (Loss) per Share to Adjusted Net Loss Per Share” table included in this press release.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210505006103/en/

Lois Lee

[email protected]

440-329-6435

KEYWORDS: United States North America Ohio

INDUSTRY KEYWORDS: Medical Devices Health

MEDIA:

Logo

May 5, 2021 4:40 pm

APA Corporation Announces First-Quarter 2021 Financial and Operational Results

HOUSTON, May 05, 2021 (GLOBE NEWSWIRE) — APA Corporation (Nasdaq: APA) today announced first-quarter 2021 results. Results can be found on the company’s website by visiting www.apacorp.com or investor.apacorp.com.

There will be a conference call May 6 at 10 a.m. Central time to discuss the results. It will be webcast and archived on APA’s website and available for playback by telephone for one week. The number for the replay is 855-859-2056 or 404-537-3406 for international calls. The conference access code is 5490148.

About APA

APA Corporation owns consolidated subsidiaries that explore for and produce oil and gas in the United States, Egypt and the United Kingdom and that explore for oil and gas offshore Suriname. APA posts announcements, operational updates, investor information and press releases on its website, www.apacorp.com. Specific information concerning Suriname, ESG performance and other investor-related topics are posted at investor.apacorp.com.

Contacts

Investor:	(281) 302-2286	Gary Clark
Media:	(713) 296-7276	Phil West
Website:	www.apacorp.com

APA-G

May 5, 2021 4:40 pm

ReconAfrica Announces C$25 Million Bought Deal Financing

Not for distribution to U.S. news wire services or dissemination in the United States.

VANCOUVER, British Columbia, May 05, 2021 (GLOBE NEWSWIRE) — Reconnaissance Energy Africa Ltd. (the “Company” or “ReconAfrica”) (TSX-V: RECO) (OTCQX: RECAF) (Frankfurt: 0XD) is pleased to announce that it has entered into an agreement with Haywood Securities Inc., as underwriter (the “Underwriter”), pursuant to which the Underwriter has agreed to buy, on a bought deal basis, 2,632,000 units (the “Units”) at a price of C$9.50 per

Unit for gross proceeds of C$25,004,000 (the “Offering”).

Each Unit will consist of one common share (a “Common Share”) in the capital of the Company and one-half of one common share purchase warrant (each whole common share purchase warrant, a “Warrant”). Each Warrant will entitle the holder to acquire one Common Share at a price of C$14.00 for a period of three years from the closing of the Offering. The Warrants will be subject to acceleration of the expiry date to a date 30 calendar days following notice to be provided to the holders of the Warrants by the Company in the event that the moving daily volume weighted average trading price of the Common Shares on the TSX Venture Exchange (the “Exchange”) over any period of 20 consecutive trading days equals or exceeds C$20.00.

The Company has granted the Underwriter an option, exercisable at the offering price to be completed concurrently with the Offering, to purchase up to an additional 15% of the number of Units issued pursuant to the Offering to cover over-allotments, if any.

The net proceeds from the Offering will be used for seismic and drilling operations, as well as for working capital and general corporate purposes.

Closing of the Offering is expected to occur on or about May 26, 2021, and is subject to the Company receiving all necessary regulatory approvals, including, but not limited to, the acceptance of the Exchange and the approval of applicable securities regulatory authorities.

The Units will be offered by way of a short form prospectus in each of the provinces of Canada, excluding Quebec, and the Units may also be offered by way of private placement in the United States.

The securities offered have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.

ReconAfrica is a junior, Canadian oil and gas company engaged in the opening of the newly discovered deep Kavango Sedimentary Basin, in the Kalahari Desert of northeastern Namibia and northwestern Botswana, where the Company holds petroleum licenses comprising approximately 8.5 million contiguous acres. In all aspects of its operations, ReconAfrica is committed to minimal disturbances in line with international best standards and will implement environmental and social best practices in all of its project areas.

Neither the TSXV nor its Regulation Services Provider (as that term is defined in policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release.

For further information contact:

Scot Evans CEO | Tel: +1-877-631-1160
Grayson Andersen Manager, IR | Tel: +1-877-631-1160

Email:
[email protected]

IR Inquiries:
[email protected]

Media Inquiries Email:
[email protected]

Cautionary Note Regarding Forward-Looking Statements:

Certain statements contained in this press release constitute forward-looking information under applicable Canadian, United States and other applicable securities laws, rules and regulations, including, without limitation, statements with respect to the completion of the Offering being subject to the receipt of all necessary regulatory approvals, including acceptance of the Exchange and applicable securities regulatory authorities, any potential acceleration of the expiry date of the Warrants, and the use of proceeds. These statements relate to future events or future performance. The use of any of the words “could”, “intend”, “expect”, “believe”, “will”, “projected”, “estimated” and similar expressions and statements relating to matters that are not historical facts are intended to identify forward-looking information and are based on ReconAfrica’s current belief or assumptions as to the outcome and timing of such future events. There can be no assurance that such statements will prove to be accurate, as the Company’s actual results and future events could differ materially from those anticipated in these forward-looking statements as a result of the factors discussed in the “Risk Factors” section in the Company’s annual information form dated July 27, 2020 available under the Company’s profile at www.sedar.com. Actual future results may differ materially. Various assumptions or factors are typically applied in drawing conclusions or making the forecasts or projections set out in forward-looking information. Those assumptions and factors are based on information currently available to ReconAfrica. The forward-looking information contained in this release is made as of the date hereof and ReconAfrica undertakes no obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by applicable securities laws. Because of the risks, uncertainties and assumptions contained herein, investors should not place undue reliance on forward-looking information. The foregoing statements expressly qualify any forward-looking information contained herein.

May 5, 2021 4:40 pm

ION reports first quarter 2021 results, reflecting third consecutive increase in backlog and transformed capital structure

HOUSTON, May 05, 2021 (GLOBE NEWSWIRE) — ION Geophysical Corporation (NYSE: IO) today reported total net revenues of $14.0 million in the first quarter 2021, a 49% decrease compared to $27.3 million in the fourth quarter 2020 and a 75% decrease compared to $56.4 million one year ago. At March 31, 2021, backlog, which consists of commitments for multi-client programs and proprietary imaging work, was $21.4 million or 9% higher compared to December 31, 2020.

Net loss attributable to ION in the first quarter 2021 was $7.2 million, or a loss of $0.46 per share, compared to a net loss attributable to ION of $2.3 million, or a loss of $0.16 per share in the first quarter 2020. Excluding special items in both periods, the Company reported an Adjusted net loss attributable to ION in the first quarter 2021 of $14.9 million, or a loss of $0.95 per share, compared to an Adjusted net income attributable to ION of $4.7 million or $0.33 per share in the first quarter 2020. The Company reported Adjusted EBITDA of $(6.6) million for the first quarter 2021, compared to $23.1 million one year ago. A reconciliation of Adjusted EBITDA to the closest comparable GAAP numbers can be found in the tables of this press release.

At quarter close, the Company’s total liquidity of $39.5 million consisted of $34.2 million of cash (including net revolver borrowings of $21.3 million) and $5.3 million of remaining available borrowing capacity under the revolving credit facility. In April 2021, the Company successfully completed its previously announced offer to exchange its 9.125% Senior Secured Notes Due in December 2021 (the “Old Notes”) for newly issued 8.00% Senior Secured Second Priority Notes due in December 2025 (the “New Notes”) and other consideration in the form of cash and ION common stock (the “Exchange Offer”). Approximately 94.1% the Old Notes where tendered and accepted as part of the Exchange Offer. The Company also completed its previously announced Rights Offering, providing shareholders the right purchase New Notes or Common Stock (the “Rights Offering”).

In total, $116.2 million in aggregate principal amount of New Notes and 10.9 million shares of Common Stock were issued through the Exchange Offer and Rights Offering. ION will receive approximately $14 million in net proceeds from the transactions after deducting noteholder obligations, transaction fees and accrued and unpaid interest paid on the Old Notes tendered. There remains $7.1 million of Old Notes outstanding. For more detailed information on the results of the Exchange Offer and Rights Offering, please see Company’s press release issued on April 20, 2021.

“We closed significantly lower multi-client data sales than expected during the first quarter, as many of our clients were restructuring their organizations and finalizing capital budgets later than usual. This delayed commercial discussions and exacerbated the typical low sales and EBITDA seasonality associated with the first quarter. Last year, we had an exception to that pattern with strong first quarter results driven by an unusually large 2019 year-end deal that ultimately closed in March of 2020. Importantly, backlog grew for the third consecutive quarter, driven by our strategic decision to participate in the 3D new acquisition multi-client market. We expect to recognize the majority of backlog as revenue during the second and third quarters as the much larger phase of our Mid North Sea High program progresses this summer. Our team has gained industry credibility and cultivated a robust pipeline of other potential 3D program opportunities, such as the exclusive agreement we announced offshore Kenya. Our proprietary Gemini™ source technology continues to perform extraordinarily well as exhibited by the project extension we received from a Super Major.

“Operations Optimization revenues remained fairly consistent sequentially. Our market diversification strategy continues to progress well. Following the fourth quarter contract award, we deployed Marlin™ SmartPort across CalMac’s ports and harbors during the first quarter and continue to receive positive client feedback on the value our software delivers. In addition to commercial discussions on very promising Marlin SmartPort trial conversions, our business development team increased outreach abroad leveraging U.S. government connections and hired an experienced resource to accelerate sales and marketing in North America. As we expanded our WellAlert™ commercial outreach in an effort to secure funding for a sea trial, several energy companies remarked on its broad applicability for additional infrastructure and environmental monitoring use cases. During the quarter, we also continued to make advancements in both the hardware and software of our prototype. Although we embarked on a diversification strategy several years ago, and have been focused on industry themes such as sustainability and digitalization for some time, this quarter we established new workgroups to accelerate progress on the most promising energy transition opportunities.

“We successfully completed the balance sheet restructuring, which extended our bond maturity to 2025 with a lower interest rate and eliminated our going concern accounting opinion. The conversion feature also has the potential to transform our capital structure by providing a path to convert nearly all our debt to equity as we execute our strategy over the coming years. Net proceeds from both the Registered Direct Offering and Rights Offering injected approximately $24 million of liquidity to provide flexibility to manage the business through the tail of the pandemic and support our diversification strategy.

“This capital restructuring allows us to focus exclusively on executing our strategy to drive long-term profitable growth in both our core and new markets. While we expect the market will remain challenging in the near-term, there have been a number of positive developments, which point to improving market conditions in the back half of the year. Brent crude oil prices, which play an integral role in the trajectory of customers’ offshore capital spending programs, have rebounded to pre-pandemic levels. With our refocused strategy, over $40 million lower cost structure, and realigned executive team, we are well positioned to capitalize on the expected modest increase in E&P spending this year; and our investments the last few years position us to leverage high value strengths to targeted new markets.”

FIRST QUARTER 2021

The Company’s segment revenues for the first quarter were as follows (in thousands):

	Three Months Ended
	March 31, 2021		December 31, 2020		March 31, 2020
E&P Technology & Services	$	7,236	$	19,934	$	46,514
Operations Optimization		6,800		7,361		9,900
Total	$	14,036	$	27,295	$	56,414

E&P Technology & Services segment revenues were $7.2 million for the first quarter 2021, compared to $19.9 million for the fourth quarter 2020 and $46.5 million for first quarter 2020. Within the E&P Technology & Services segment, multi-client revenues were $3.6 million, a decrease of 91% from first quarter 2020, primarily due to lower volume of data library sales. Imaging and Reservoir Services revenues were $3.7 million, a decrease of 26% from first quarter 2020, due to lower proprietary tender activity.

Operations Optimization segment revenues were $6.8 million for the first quarter 2021 compared to $7.4 million for the fourth quarter 2020 and $9.9 million for first quarter 2020. Within the Operations Optimization segment, Optimization Software & Services revenues were $2.8 million, a 36% decline from first quarter 2020 due to reduced seismic activity and associated services demand resulting from COVID-19. Devices revenues were $4.0 million, a 28% decrease from first quarter 2020 due to lower sales of towed streamer equipment spares and repairs.

Consolidated gross margin for the quarter was 6%, compared to 27% for the fourth quarter 2020 and 50% one year ago primarily from decline in revenues. Gross margin in E&P Technology & Services was (22)% compared to 22% for the fourth quarter 2020 and 51% one year ago resulting from a significant year-end 2D data library deal that ultimately closed during the first quarter 2020 that was not repeated during the first quarter 2021. Operations Optimization gross margin was 36%, compared to 42% for the fourth quarter 2020 and 47% one year ago.

Consolidated operating expenses were $11.1 million, a 5% decrease from $11.7 million in the fourth quarter 2020 and a 50% decrease from $22.0 million in the first quarter 2020 resulting from the cost reductions implemented during the first half of 2020. Excluding the impact of special items from last year, first quarter 2021 operating expenses declined by 30% and 17%, respectively, compared to the adjusted operating expenses of $13.3 million in the fourth quarter 2020 and $15.9 million one year ago. Operating margin was (73)%, compared to 11% one year ago. The decline in operating margin was the result of the decline in net revenues.

Income tax expense (benefit) was $(6.8) million for the first quarter 2021 compared to $5.6 million for the fourth quarter 2020 and $5.9 million for the first quarter 2020. The income tax benefit for the Current Quarter primarily relates to the reversal of the valuation allowance of $7.7 million related to net deferred tax assets of certain foreign subsidiaries. The Company’s income tax expense in the first quarter 2020 primarily relates to results generated by our non-U.S. businesses in Latin America.

CONFERENCE CALL

The Company has scheduled a conference call for Thursday, May 6, 2021, at 10:00 a.m. Eastern Time that will include a slide presentation to be posted in the Investor Relations section of the ION website by 9:00 a.m. Eastern Time. To participate in the conference call, dial (833) 362-0195 at least 10 minutes before the call begins and ask for the ION conference call. A replay of the call will be available approximately two hours after the live broadcast ends and will be accessible until May 13, 2021. To access the replay, dial (855) 859-2056 and use pass code 8154095.

Investors, analysts and the general public will also have the opportunity to listen to the conference call live over the Internet by visiting ir.iongeo.com. An archive of the webcast will be available shortly after the call on the Company’s website.

About ION

Leveraging innovative technologies, ION delivers powerful data-driven decision-making to offshore energy and maritime operations markets, enabling clients to optimize investments and results through access to our data, software and distinctive analytics. Learn more at iongeo.com.

Contact

Mike Morrison
Executive Vice President and Chief Financial Officer
+1.281.879.3615

The information herein contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements may include information and other statements that are not of historical fact. Actual results may vary materially from those described in these forward-looking statements. All forward-looking statements reflect numerous assumptions and involve a number of risks and uncertainties. These risks and uncertainties include the risks associated with the timing and development of ION Geophysical Corporation’s products and services; pricing pressure; decreased demand; changes in oil prices; agreements made or adhered to by members of OPEC and other oil producing countries to maintain production levels; the COVID-19 pandemic; the ultimate benefits of our completed restructuring transactions; and political, execution, regulatory, and currency risks. For additional information regarding these various risks and uncertainties, see our Form 10-K for the year ended December 31, 2020, filed on February 12, 2021. Additional risk factors, which could affect actual results, are disclosed by the Company in its filings with the Securities and Exchange Commission (SEC), including its Form 10-K, Form 10-Qs and Form 8-Ks filed during the year. The Company expressly disclaims any obligation to revise or update any forward-looking statements.

Tables to follow

ION GEOPHYSICAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

	Three Months Ended
	March 31, 2021			December 31, 2020			March 31, 2020
	(In thousands, except per share data)
Service revenues	$	7,464		$	20,113		$	47,485
Product revenues		6,572			7,182			8,929
Total net revenues		14,036			27,295			56,414
Cost of services		9,270			16,022			22,275
Cost of products		3,907			3,833			4,628
Impairment of multi-client data library		—			—			1,167
Gross profit		859			7,440			28,344
Operating expenses:
Research, development and engineering		2,947			3,022			4,008
Marketing and sales		2,759			2,787			4,858
General, administrative and other operating expenses		5,387			5,910			9,002
Impairment of goodwill		—			—			4,150
Total operating expenses		11,093			11,719			22,018
Income (loss) from operations		(10,234	)		(4,279	)		6,326
Interest expense, net		(3,262	)		(3,501	)		(3,221	)
Other income (expense), net		(607	)		223			429
Income (loss) before income taxes		(14,103	)		(7,557	)		3,534
Income tax expense (benefit), net		(6,849	)		5,634			5,874
Net loss		(7,254	)		(13,191	)		(2,340	)
Less: Net loss attributable to noncontrolling interests		91			55			77
Net loss attributable to ION	$	(7,163	)	$	(13,136	)	$	(2,263	)
Net loss per share:
Basic and Diluted	$	(0.46	)	$	(0.92	)	$	(0.16	)
Weighted average number of common shares outstanding:
Basic and Diluted		15,718			14,320			14,230

ION GEOPHYSICAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Unaudited)

	March 31,			December 31,
	2021			2020
	(In thousands, except share data)
ASSETS
Current assets:
Cash and cash equivalents	$	34,228		$	37,486
Accounts receivable, net		8,457			8,045
Unbilled receivables		4,085			11,262
Inventories, net		11,031			11,267
Prepaid expenses and other current assets		7,387			7,116
Total current assets		65,188			75,176
Deferred income tax asset, net		7,743			—
Property, plant and equipment, net		9,063			9,511
Multi-client data library, net		50,300			50,914
Goodwill		19,773			19,565
Right-of-use assets		33,330			35,501
Other assets		4,250			2,926
Total assets	$	189,647		$	193,593
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Current maturities of long-term debt	$	29,233		$	143,731
Accounts payable		28,242			33,418
Accrued expenses		17,737			16,363
Accrued multi-client data library royalties		20,677			21,359
Deferred revenue		4,454			3,648
Current maturities of operating lease liabilities		8,408			7,570
Total current liabilities		108,751			226,089
Long-term debt, net of current maturities		112,737			—
Operating lease liabilities, net of current maturities		36,318			38,372
Other long-term liabilities		212			222
Total liabilities		258,018			264,683
Deficit:
Common stock, $0.01 par value; authorized 26,666,667 shares; outstanding 17,344,187 and 14,333,101 shares at March 31, 2021 and December 31, 2020, respectively.		173			143
Additional paid-in capital		968,633			958,584
Accumulated deficit		(1,018,679	)		(1,011,516	)
Accumulated other comprehensive loss		(19,575	)		(19,913	)
Total stockholders’ deficit		(69,448	)		(72,702	)
Noncontrolling interests		1,077			1,612
Total deficit		(68,371	)		(71,090	)
Total liabilities and stockholders’ deficit	$	189,647		$	193,593

ION GEOPHYSICAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

	Three Months Ended March 31,
	2021			2020
Cash flows from operating activities:
Net loss	$	(7,254	)	$	(2,340	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization (other than multi-client library)		959			840
Amortization of multi-client data library		3,285			8,020
Impairment of multi-client data library		—			1,167
Impairment of goodwill		—			4,150
Stock-based compensation expense		286			617
Provision for expected credit losses		396			—
Deferred income taxes		(7,743	)		421
Change in operating assets and liabilities:
Accounts receivable		(798	)		(21,868	)
Unbilled receivables		7,177			2,666
Inventories		217			(772	)
Accounts payable, accrued expenses and accrued royalties		(2,598	)		1,688
Deferred revenue		823			355
Other assets and liabilities		973			(1,910	)
Net cash used in operating activities		(4,277	)		(6,966	)
Cash flows from investing activities:
Investment in multi-client data library		(5,211	)		(9,668	)
Purchase of property, plant and equipment		(576	)		(496	)
Net cash used in investing activities		(5,787	)		(10,164	)
Cash flows from financing activities:
Borrowings under revolving line of credit		—			27,000
Repayments under revolving line of credit		(1,250	)		—
Payments on notes payable and long-term debt		(752	)		(760	)
Costs associated with debt issuance		(806	)		—
Net proceeds from issuance of stocks		9,802			—
Other financing activities		(316	)		(10	)
Net cash provided by financing activities		6,678			26,230
Effect of change in foreign currency exchange rates on cash, cash equivalents and restricted cash		128			470
Net increase (decrease) in cash, cash equivalents and restricted cash		(3,258	)		9,570
Cash, cash equivalents and restricted cash at beginning of period		39,813			33,118
Cash, cash equivalents and restricted cash at end of period	$	36,555		$	42,688

ION GEOPHYSICAL CORPORATION AND SUBSIDIARIES

SUMMARY OF SEGMENT INFORMATION

(In thousands)

(Unaudited)

	Three Months Ended
	March 31, 2021			December 31, 2020			March 31, 2020
Net revenues:
E&P Technology & Services:
New Venture	$	1,087		$	3,458		$	1,441
Data Library		2,484			13,707			40,131
Total multi-client revenues		3,571			17,165			41,572
Imaging and Reservoir Services		3,665			2,769			4,942
Total		7,236			19,934			46,514
Operations Optimization:
Optimization Software & Services		2,844			3,326			4,427
Devices		3,956			4,035			5,473
Total		6,800			7,361			9,900
Total net revenues	$	14,036		$	27,295		$	56,414
Gross profit (loss):
E&P Technology & Services	$	(1,607	)	$	4,341		$	23,730		(a)
Operations Optimization		2,466			3,099			4,614
Total gross profit	$	859		$	7,440		$	28,344
Gross margin:
E&P Technology & Services		(22	)%		22	%		51	%
Operations Optimization		36	%		42	%		47	%
Total		6	%		27	%		50	%
Income (loss) from operations:
E&P Technology & Services	$	(4,853	)	$	(669	)	$	17,952		(a)
Operations Optimization		(820	)		(591	)		(3,259	)	(b)
Support and other		(4,561	)		(3,019	)		(8,367	)
Income (loss) from operations		(10,234	)		(4,279	)		6,326
Interest expense, net		(3,262	)		(3,501	)		(3,221	)
Other income (expense), net		(607	)		223			429
Income (loss) before income taxes	$	(14,103	)	$	(7,557	)	$	3,534

(a) Includes impairment of multi-client data library of $1.2 million for the three months ended March 31, 2020.
(b) Includes impairment of goodwill of $4.2 million for the three months ended March 31, 2020.

ION GEOPHYSICAL CORPORATION AND SUBSIDIARIES

Summary of Net Revenues by Geographic Area

(In thousands)

(Unaudited)

	Three Months Ended
	March 31, 2021		December 31, 2020		March 31, 2020
Europe	$	4,366	$	2,537	$	7,472
Latin America		3,503		7,411		20,062
Asia Pacific		2,201		3,971		7,763
Africa		1,772		10,413		12,240
North America		1,208		1,936		3,888
Middle East		727		817		954
Other		259		210		4,035
Total net revenues	$	14,036	$	27,295	$	56,414

ION GEOPHYSICAL CORPORATION AND SUBSIDIARIES

Reconciliation of Adjusted EBITDA to Net Loss (Non-GAAP Measure)

(In thousands)

(Unaudited)

The term EBITDA (excluding non-recurring items) represents net loss before net interest expense, income taxes, depreciation and amortization and other non-recurring charges such as impairment charges and severance expenses. The term Adjusted EBITDA is EBITDA (excluding non-recurring items) but also excludes the impact of fair value adjustments related to the Company’s outstanding stock appreciation awards. EBITDA (excluding non-recurring items) and Adjusted EBITDA are not measures of financial performance under generally accepted accounting principles and should not be considered in isolation from or as a substitute for net income (loss) or cash flow measures prepared in accordance with generally accepted accounting principles or as a measure of profitability or liquidity. Additionally, EBITDA (excluding non-recurring items) and Adjusted EBITDA may not be comparable to other similarly titled measures of other companies. The Company has included EBITDA (excluding non-recurring items) and Adjusted EBITDA as a supplemental disclosure because its management believes that EBITDA (excluding non-recurring items) and Adjusted EBITDA provides investors a helpful measure for comparing its operating performance with the performance of other companies that have different financing and capital structures or tax rates.

	Three Months Ended
	March 31, 2021				December 31, 2020				March 31, 2020
Net loss	$	(7,254	)		$	(13,191	)		$	(2,304	)
Interest expense, net		3,262				3,501				3,321
Income tax expense (benefit)		(6,849	)	(a)		5,634		(b)		5,874
Depreciation and amortization expense		4,244				6,686				8,860
Impairment of multi-client data library		—				—				1,167
Impairment of goodwill		—				—				4,150
Severance expense		—				—				3,102
EBITDA excluding non-recurring items		(6,597	)			2,630				24,170
Stock appreciation rights (credit) expense		7				(1,541	)			(1,094	)
Adjusted EBITDA	$	(6,590	)		$	1,089			$	23,076

(a) Includes reversal of valuation allowance on our net deferred tax assets of $7.7 million resulting from the going concern being removed for the three months ended March 31, 2021.
(b) Includes valuation allowance on our net deferred tax assets resulting from the going concern conclusion of $8.5 million for the three months ended December 31, 2020.

ION GEOPHYSICAL CORPORATION AND SUBSIDIARIES

Description of Special Items and Reconciliation of GAAP (As Reported) to Non-GAAP (As Adjusted) Measures

(In thousands, except per share data)

(Unaudited)

The financial results are reported in accordance with GAAP. However, management believes that certain non-GAAP performance measures may provide users of this financial information, additional meaningful comparisons between current results and results in prior operating periods. One such non-GAAP financial measure is adjusted income (loss) from operations or adjusted net income (loss), which excludes certain charges or amounts. This adjusted income (loss) amount is not a measure of financial performance under GAAP. Accordingly, it should not be considered as a substitute for income (loss) from operations, net income (loss) or other income data prepared in accordance with GAAP. See the tables below for supplemental financial data and the corresponding reconciliation to GAAP financials for the three months ended March 31, 2021 and 2020 and December 31, 2020:

	Three Months Ended March 31, 2021									Three Months Ended December 31, 2020									Three Months Ended March 31, 2020
	As Reported			Special Items			As Adjusted			As Reported			Special Items			As Adjusted			As Reported			Special Items			As Adjusted
Net revenues	$	14,036		$	—		$	14,036		$	27,295		$	—		$	27,295		$	56,414		$	—		$	56,414
Cost of sales		13,177			—			13,177			19,855			—			19,855			28,070			(1,167	)(a)		26,903
Gross profit		859			—			859			7,440			—			7,440			28,344			1,167			29,511
Operating expenses		11,093			(7	)		11,086			11,719			1,541	(d)		13,260			22,018			(6,158	)(b)		15,860
Income (loss) from operations		(10,234	)		7			(10,227	)		(4,279	)		(1,541	)		(5,820	)		6,326			7,325			13,651
Interest expense, net		(3,262	)		—			(3,262	)		(3,501	)		—			(3,501	)		(3,221	)		—			(3,221	)
Other income (expense), net		(607	)		—			(607	)		223			(8,492	)(e)		(8,269	)		429			—			429
Income (loss) before income taxes		(14,103	)		7			(14,096	)		(7,557	)		6,951			(606	)		3,534			7,325			10,859
Income tax expense (benefit)		(6,849	)		7,743	(c)		894			5,634			—			5,634			5,874			350	(a)		6,224
Net income (loss)		(7,254	)		(7,736	)		(14,990	)		(13,191	)		6,951			(6,240	)		(2,340	)		6,975			4,635
Net loss attributable to noncontrolling interests		91			—			91			55			—			55			77			—			77
Net income (loss) attributable to ION	$	(7,163	)	$	(7,736	)	$	(14,899	)	$	(13,136	)	$	6,951		$	(6,185	)	$	(2,263	)	$	6,975		$	4,712
Net income (loss) per share:
Basic	$	(0.46	)				$	(0.95	)	$	(0.92	)				$	(0.43	)	$	(0.16	)				$	0.33
Diluted	$	(0.46	)				$	(0.95	)	$	(0.92	)				$	(0.43	)	$	(0.16	)				$	0.33
Weighted average number of common shares outstanding:
Basic		15,718						15,718			14,320						14,320			14,230						14,230
Diluted		15,718						15,718			14,320						14,320			14,230						14,286

(a) Represents the impairment of multi-client data library of $1.2 million and the related tax impact of $0.4 million for the three months ended March 31, 2020.
(b) Represents impairment of goodwill of $4.2 million and severance expense of $3.1 million, partially offset by stock appreciation right awards credit of $1.1 million for the three months ended March 31, 2020.
(c) Represents the reversal of valuation allowance on our net deferred tax assets of $7.7 million for the three months ended March 31, 2021.
(d) Represents stock appreciation rights awards credit of $1.5 million for the three months ended December 31, 2020.
(e) Represents a full valuation allowance on our net deferred tax assets of $8.5 million for the three months ended December 31, 2020.

May 5, 2021 4:39 pm

PayPal Reports First Quarter 2021 Results

PR Newswire

SAN JOSE, Calif., May 5, 2021 /PRNewswire/ — PayPal Holdings, Inc. (NASDAQ: PYPL) today announced its first quarter 2021 results for the period ended March 31, 2021. The earnings release and related materials discussing these results can be found on its investor relations website at https://investor.pypl.com/financials/quarterly-results/default.aspx.

PayPal Holdings, Inc. will host a conference call to discuss these results at 2:00 p.m. Pacific time (5:00 p.m. Eastern time) today. A live webcast of the conference call will be available at https://investor.pypl.com. In addition, an archive of the webcast will be accessible for 90 days through the same link.

About PayPal

PayPal has remained at the forefront of the digital payment revolution for more than 20 years. By leveraging technology to make financial services and commerce more convenient, affordable, and secure, the PayPal platform is empowering more than 375 million consumers and merchants in more than 200 markets to join and thrive in the global economy. For more information, visit paypal.com.

Investor Relations Contact

Gabrielle Rabinovitch

[email protected]

Jesse Kreger

[email protected]

Media Relations Contacts

Amanda Miller

[email protected]

Josh Criscoe

[email protected]

View original content:http://www.prnewswire.com/news-releases/paypal-reports-first-quarter-2021-results-301284948.html

SOURCE PayPal Holdings, Inc.

May 5, 2021 4:39 pm

Perspecta Stockholders Approve Acquisition by Veritas Capital

PR Newswire

CHANTILLY, Va., May 5, 2021 /PRNewswire/ — Perspecta Inc. (NYSE: PRSP) (“Perspecta” or the “Company”) today announced that, at a special meeting of stockholders held on May 5, 2021, the stockholders of the Company approved a proposal to adopt the merger agreement under which Peraton, a portfolio company of leading private investment firm Veritas Capital, will acquire the Company for $29.35 per share in cash.

The majority of shares of the Company’s common stock issued and outstanding as of the close of business on March 18, 2021, the record date for the Special Meeting, voted to adopt the Merger Agreement. Perspecta will provide final vote results for the special meeting, as certified by the independent Inspector of Election, on a Form 8-K with the Securities and Exchange Commission.

The proposed transaction is expected to close in the coming days.

About Perspecta Inc.

At Perspecta (NYSE: PRSP), we question, we seek and we solve. Perspecta brings a diverse set of capabilities to our U.S. government customers in defense, intelligence, civilian, health care and state and local markets. Our 280+ issued, licensed and pending patents are more than just pieces of paper, they tell the story of our innovation. With offerings in mission services, digital transformation and enterprise operations, our team of nearly 14,000 engineers, analysts, investigators and architects work tirelessly to not only execute the mission, but build and support the backbone that enables it. Perspecta was formed to take on big challenges. We are an engine for growth and success and we enable our customers to build a better nation. For more information about Perspecta, visit perspecta.com.

Forward-Looking Statements

All statements and assumptions in this communication that do not directly and exclusively relate to historical facts could be deemed “forward-looking statements.” Forward-looking statements are often identified by the use of words such as “anticipates,” “believes,” “estimates,” “expects,” “may,” “could,” “should,” “forecast,” “goal,” “intends,” “objective,” “plans,” “projects,” “strategy,” “target” and “will” and similar words and terms or variations of such. These statements represent current intentions, expectations, beliefs or projections, and no assurance can be given that the results described in such statements will be achieved. Forward-looking statements include, among other things, statements about the expected timing of completion of the proposed transaction, as well as any assumptions underlying any of the foregoing. Such statements are subject to numerous assumptions, risks, uncertainties and other factors that could cause actual results to differ materially from those described in such statements, many of which are outside of the Company’s control. Important factors that could cause actual results to differ materially from those described in forward-looking statements include, but are not limited to, (i) uncertainties as to the timing of the proposed transaction; (ii) the risk that the proposed transaction may not be completed in a timely manner or at all; (iii) the possibility that competing offers or acquisition proposals for the Company will be made; (iv) the possibility that any or all of the various conditions to the consummation of the proposed transaction may not be satisfied or waived; (v) the occurrence of any event, change or other circumstance that could give rise to the termination of the merger agreement, including in circumstances that would require the Company to pay a termination fee or other expenses; (vi) the effect of the pendency of the proposed transaction on the Company’s ability to retain and hire key personnel, its ability to maintain relationships with its customers, suppliers and others with whom it does business, its business generally or its stock price; (vii) risks related to diverting management’s attention from the Company’s ongoing business operations; (viii) the risk that stockholder litigation in connection with the proposed transaction may result in significant costs of defense, indemnification and liability; (ix) various risks related to health epidemics, pandemics and similar outbreaks, such as the COVID-19 pandemic, which may have material adverse effects on the Company’s business, financial position, results of operations and/or cash flows; (x) any issue that compromises the Company’s relationships with the U.S. federal government, or any state or local governments, or damages the Company’s professional reputation; (xi) changes in the U.S. federal, state and local governments’ spending and mission priorities that shift expenditures away from agencies or programs that the Company supports; (xii) any delay in completion of the U.S. federal government’s budget process; (xiii) failure to comply with numerous laws, regulations and rules, including regarding procurement, anti-bribery and organizational conflicts of interest; (xiv) failure by the Company or its employees to obtain and maintain necessary security clearances or certifications; (xv) the Company’s ability to compete effectively in the competitive bidding process and delays, contract terminations or cancellations caused by competitors’ protests of major contract awards received by the Company; (xvi) the Company’s ability to accurately estimate or otherwise recover expenses, time and resources for its contracts; (xvii) problems or delays in the development, delivery and transition of new products and services or the enhancement of existing products and services to meet customer needs and respond to emerging technological trends; (xviii) failure of third parties to deliver on commitments under contracts with the Company; (xix) misconduct or other improper activities from the Company’s employees or subcontractors; (xx) delays, terminations, or cancellations of the Company’s major contract awards, including as a result of its competitors protesting such awards; (xxi) failure of the Company’s internal control over financial reporting to detect fraud or other issues; (xxii) failure or disruptions to the Company’s systems, due to cyber-attack, service interruptions or other security threats; (xxiii) failure to be awarded task orders under the Company’s indefinite delivery/indefinite quantity contracts; (xxiv) changes in government procurement, contract or other practices or the adoption by the government of new laws, rules and regulations in a manner adverse to the Company; (xxv) uncertainty from the expected discontinuance of the London Interbank Offered Rate and transition to any other interest rate benchmark; and (xxvi) other factors as set forth from time to time in the Company’s filings with the SEC, including its Annual Report on Form 10-K for the fiscal year ended March 31, 2020, as may be updated or supplemented by any subsequent Quarterly Reports on Form 10-Q or other filings with the SEC. Readers are cautioned not to place undue reliance on such statements which speak only as of the date they are made. The Company does not undertake any obligation to update or release any revisions to any forward-looking statement or to report any events or circumstances after the date of this communication or to reflect the occurrence of unanticipated events except as required by law.

View original content to download multimedia:http://www.prnewswire.com/news-releases/perspecta-stockholders-approve-acquisition-by-veritas-capital-301284928.html

SOURCE Perspecta Inc.

May 5, 2021 4:39 pm

Foot Locker, Inc. To Report First Quarter Financial Results On Friday, May 21, 2021

Press Release to be issued before the U.S. markets open on May 21, followed by a 9 a.m. ET Conference Call

PR Newswire

NEW YORK, May 5, 2021 /PRNewswire/ — Foot Locker, Inc. (NYSE: FL), the New York-based specialty athletic retailer, plans to report financial results for its first quarter ended May 1, 2021 before the U.S. markets open on Friday, May 21, 2021. A conference call is scheduled for the same day at 9:00 a.m. ET, during which the Company will provide an update on the business.

We encourage participants to pre-register for the conference call using the following link: http://dpregister.com/sreg/10154491/e675d1d82c. Callers who pre-register will be given a conference passcode and unique pin to gain immediate access to the call and bypass the live operator. Participants may pre-register at any time including up to and after the call has started. Those without internet access or who are unable to pre-register may dial-in by calling toll free 1-844-701-1163 or international toll 1-412-317-5490.

A live webcast will be available on the Investor Relations section of the Foot Locker, Inc. website at https://www.footlocker-inc.com. Please log on to the website 15 minutes prior to the call in order to download any necessary software. An archived replay of the conference call can be accessed approximately one hour following the end of the call at 1-877-344-7529 in the U.S. or 1-855-669-9658 in Canada or 1-412-317-0088 internationally with passcode 10154491 through June 4, 2021. A replay of the call will also be available via webcast from the same Investor Relations section of the Foot Locker, Inc. website at https://www.footlocker-inc.com.

Foot Locker, Inc. leads the celebration of sneaker and youth culture around the globe through a portfolio of brands including Foot Locker, Kids Foot Locker, Champs Sports, Eastbay, Footaction, and Sidestep. With approximately 3,000 retail stores in 27 countries across North America, Europe, Asia, Australia, and New Zealand as well as websites and mobile apps, the Company’s purpose is to inspire and empower youth culture around the world, by fueling a shared passion for self-expression and creating unrivaled experiences at the heart of the global sneaker community. Foot Locker, Inc. has its corporate headquarters in New York. For additional information please visit https://www.footlocker-inc.com.

Contact: James R. Lance
Vice President,
Corporate Finance and
Investor Relations
Foot Locker, Inc.
[email protected]
(212) 720-4600

View original content:http://www.prnewswire.com/news-releases/foot-locker-inc-to-report-first-quarter-financial-results-on-friday-may-21-2021-301284924.html

SOURCE Foot Locker, Inc.

May 5, 2021 4:39 pm

Lument Finance Trust, Inc. Announces Closing of Public Offering of Series A Cumulative Redeemable Preferred Stock

PR Newswire

NEW YORK, May 5, 2021 /PRNewswire/ — Lument Finance Trust, Inc. (NYSE: LFT) (the “Company”) announced today that it has closed its underwritten public offering of 2,400,000 shares of its newly designated 7.875% Series A Cumulative Redeemable Preferred Stock, par value $0.01 per share (the “Series A Preferred Stock”) at a public offering price of $25.00 per share.

The Company received approximately $58.1 million of net proceeds from the offering after deducting the underwriting discount but before estimated offering expenses payable by the Company. The Company intends to use the net proceeds of the offering to make additional investments in target assets consistent with its investment strategy and for general corporate purposes.

The Series A Preferred Stock has been authorized for listing on the New York Stock Exchange under the symbol “LFTPrA.” Trading of the Series A Preferred Stock is expected to commence on May 10, 2021.

Piper Sandler and Raymond James served as joint book-running managers for the offering and B. Riley Securities and JonesTrading served as co-managers for the offering.

The offering was made pursuant a prospectus, dated April 28, 2021 that constitutes part of the Company’s Registration Statement on Form S-11, which was declared effective by the U.S. Securities and Exchange Commission (“SEC”) on April 28, 2021, and the Company’s Registration Statement on Form S-11 MEF, which became effective upon filing with the SEC on April 28, 2021.

Copies of the prospectus supplement and accompanying prospectus may be obtained from the SEC’s website at www.sec.gov or from Piper Sandler & Co. at 1251 Avenue of the Americas, 6th Floor, New York, NY 10020, or by email at [email protected] or from Raymond James & Associates, Inc. at 880 Carillon Parkway, St. Petersburg, FL 33716, or by email at [email protected].

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

About LFT

LFT is a Maryland corporation focused on investing in, financing and managing a portfolio of commercial real estate debt investments. The Company primarily invests in transitional floating rate commercial mortgage loans with an emphasis on middle-market multi-family assets.

LFT is externally managed and advised by OREC Investment Management, LLC d/b/a Lument Investment Management, a Delaware limited liability company. The Company changed its name from Hunt Companies Finance Trust, Inc. to Lument Finance Trust, Inc., effective December 28, 2020.

Forward Looking Statements

Certain statements included in this press release constitute forward-looking statements intended to qualify for the safe harbor contained in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act, as amended. Forward-looking statements are subject to risks and uncertainties. You can identify forward-looking statements by use of words such as “believe,” “expect,” “anticipate,” “project,” “estimate,” “plan,” “continue,” “intend,” “should,” “may,” “will,” “seek,” “would,” “could,” or similar expressions or other comparable terms, or by discussions of strategy, plans or intentions. Forward-looking statements are based on the Company’s beliefs, assumptions and expectations of its future performance, taking into account all information currently available to the Company on the date of this press release or the date on which such statements are first made. Actual results may differ from expectations, estimates and projections. You are cautioned not to place undue reliance on forward-looking statements in this press release and should consider carefully the factors described in Part I, Item IA “Risk Factors” in the Company’s annual reports on Form 10-K, our quarterly reports on Form 10-Q, and other current or periodic filings with the SEC, when evaluating these forward-looking statements. 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. Additionally, many of these risks and uncertainties are currently amplified by and will continue to be amplified by, or in the future may be amplified by, the COVID-19 pandemic. Additional information concerning these and other risk factors are contained in our 2020 10-K which is available on the SEC’s website at www.sec.gov. Except as required by applicable law, 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.

View original content to download multimedia:http://www.prnewswire.com/news-releases/lument-finance-trust-inc-announces-closing-of-public-offering-of-series-a-cumulative-redeemable-preferred-stock-301284914.html

SOURCE Lument Finance Trust, Inc.