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Life Storage, Inc. Reports First Quarter 2021 Results

Life Storage, Inc. Reports First Quarter 2021 Results

BUFFALO, N.Y.–(BUSINESS WIRE)–Life Storage, Inc. (NYSE:LSI), a leading national owner and operator of self-storage properties, reported operating results for the quarter ended March 31, 2021. All share and per share information has been retrospectively adjusted to reflect the January 2021 three-for-two stock split made in the form of a 50% stock dividend.

Highlights for the First Quarter Included:

  • Generated net income attributable to common shareholders of $47.4 million, or $0.63 per fully diluted common share.
  • Achieved adjusted funds from operations (“FFO”)(1) per fully diluted common share of $1.08, a 16.1% increase over the same period in 2020.
  • Increased same store revenue by 7.3% and same store net operating income (“NOI”)(2) by 8.6%, year-over-year.
  • Acquired 16 stores for $266.2 million, including one store from one of our unconsolidated joint ventures for $47.9 million (net).
  • Added 18 stores (gross) to the Company’s third-party management platform.

Joe Saffire, the Company’s Chief Executive Officer, stated, “We are off to a very solid start to the year with record occupancy, strong pricing power and robust acquisition activity. We’ve added more scale in key existing markets with the addition of 16 stores to our wholly owned portfolio and 18 stores to our third-party management platform. Warehouse Anywhere continues to gain traction with a significant contract for our Enterprise Solution and a growing pipeline for all business lines. We continue to demonstrate that our industry leading technology is a clear differentiator that we believe positions us well to further grow shareholder value in 2021 and beyond.”

FINANCIAL RESULTS:

In the first quarter of 2021, the Company generated net income attributable to common shareholders of $47.4 million or $0.63 per fully diluted common share, compared to net income attributable to common shareholders of $36.4 million, or $0.52 per fully diluted common share, in the first quarter of 2020. Net income in the quarter ended March 31, 2021 benefited from $0.8 million of preferred dividend income associated with the acquisition of a store from one of our unconsolidated joint ventures.

Funds from operations for the quarter were $1.08 per fully diluted common share compared to $0.94 for the same period last year. Adjusted FFO per fully diluted common share for the quarter was similarly $1.08, compared to $0.93, after adjusting for a total of $0.5 million related to a gain on sale of land and acquisition fees, for the quarter ended March 31, 2020.

OPERATIONS:

Revenues for the 531 stabilized stores wholly owned by the Company since December 31, 2019 increased 7.3% in the first quarter of 2021 compared to the same quarter of 2020. The increase largely resulted from the net impact of a 410 basis point increase in average occupancy and the net impact of a 1.3% increase in realized rental rates.

Same store operating expenses increased 4.7% for the first quarter of 2021 compared to the prior year period, the result of increased real estate taxes, repair and maintenance (including snow removal), office and other operating expense, payroll and benefits and utilities. The increases were offset by decreases in marketing expenses. Same store NOI increased 8.6% in the first quarter of 2021 as compared to the first quarter of 2020.

During the first quarter of 2021, the Company achieved same store revenue growth in 30 of its 31 major markets. Overall, the markets with the strongest positive revenue impact were New York-Newark-Jersey City, New England-Other and Buffalo-Upstate.

PORTFOLIO TRANSACTIONS:

During the quarter, the Company acquired 16 stores in Florida (8), Arizona (3), Washington (2), New York (1), California (1) and South Carolina (1) for a total purchase price of $266.2 million. One of the properties was acquired from SNL Orix Merrick, LLC, a joint venture in which the Company has a 5% common and a preferred investment. The net investment to acquire the property was $47.9 million.

At March 31, 2021, the Company was under contract to acquire six self-storage facilities in New Jersey (5) and Florida (1) for an aggregate purchase price of $106.5 million. The Company acquired one of these facilities subsequent to March 31, 2021 for $16.5 million. Also subsequent to quarter end, the Company entered into contracts to acquire 11 self-storage facilities in Texas (4), North Carolina (3), Florida (2) and New Hampshire (2) for an aggregate purchase price of $159.2 million. The purchases of the remaining facilities are subject to customary conditions to closing, and there is no assurance that any of these facilities will be acquired.

THIRD-PARTY MANAGEMENT:

The Company continues to aggressively and profitably grow its third-party management platform. During the quarter, the Company added 18 stores (gross). As of quarter end, the Company managed 342 facilities in total, including those in which it owns a minority interest.

WAREHOUSE ANYWHERE:

Subsequent to quarter end, a corporate customer awarded a multi-year contract to Warehouse Anywhere to expand its existing relationship by adding approximately 300 storage units nationwide. Each space will include Warehouse Anywhere’s proprietary inventory management technology solution.

FINANCIAL POSITION:

At March 31, 2021, the Company had approximately $13.9 million of cash on hand, and approximately $456.9 million available on its line of credit.

During the three months ended March 31, 2021, the Company issued 2,220,559 shares of common stock under its continuous equity offering program at a weighted average issue price of $82.23 per share, generating net proceeds after expenses of $180.5 million.

Below are key financial ratios at March 31, 2021:

  • Debt to Enterprise Value (at $85.95/share)

25.5%

  • Debt to Book Cost of Storage Facilities

40.3%

  • Debt to Recurring Annualized EBITDA

5.5x

  • Debt Service Coverage

4.9x

STOCK SPLIT AND COMMON STOCK DIVIDEND:

During the quarter, the Company completed a three-for-two stock split, which was made in the form of a 50% stock dividend. The additional shares were distributed on January 27, 2021 and Life Storage’s common stock began trading on a split-adjusted basis on January 28, 2021.

Subsequent to quarter end, the Company’s Board of Directors approved a quarterly dividend of $0.74 per share, or $2.96 annualized, on a post-split basis. The dividend was paid on April 26, 2021 to shareholders of record on April 14, 2021.

YEAR 2021EARNINGS GUIDANCE:

The following assumptions covering operations have been utilized in formulating guidance for 2021:

Year 2021 Earnings Guidance

Current Guidance

Range

Prior Guidance

Range

(February 22, 2021)

Same Store Revenue

5.50%

–

6.50%

 

3.75%

–

4.75%

Same Store Operating Costs (excluding property taxes)

2.25%

–

3.25%

 

2.25%

–

3.25%

Same Store Property Taxes

6.75%

–

7.75%

 

6.75%

–

7.75%

Total Same Store Operating Expenses

4.00%

–

5.00%

 

4.00%

–

5.00%

Same Store Net Operating Income

6.50%

–

7.50%

 

3.75%

–

4.75%

General & Administrative

$57M

–

$58M

 

$56M

–

$57M

Expansions & Enhancements

$40M

–

$50M

 

$40M

–

$50M

Capital Expenditures

$21M

–

$26M

 

$21M

–

$26M

Wholly Owned Acquisitions

$550M

–

$600M

 

$350M

–

$450M

Joint Venture Investments

$20M

–

$25M

 

$20M

–

$25M

 

 

 

 

 

 

 

 

Adjusted Funds from Operations per Share

$4.33

–

$4.41

 

$4.18

–

$4.28

 

 

Reconciliation of Guidance

2Q 2021

Range or Value

FY 2021

Range or Value

Earnings per share attributable to common shareholders – diluted

$0.63 – $0.67

$2.53 – $2.61

Plus: real estate depreciation and amortization

0.45 – 0.45

1.80 – 1.80

FFO per share

$1.08 – $1.12

$4.33 – $4.41

 

The Company’s 2021 same store pool consists of the 531 stabilized stores wholly owned since December 31, 2019. Twenty-five of the stores purchased through March 31, 2021 at certificate of occupancy or that were in the early stages of lease-up are not included, regardless of their current occupancies. The Company believes that occupancy levels achieved during the lease-up period, using discounted rates, are not truly indicative of a new store’s performance, and therefore do not result in a meaningful year-over-year comparison in future years. The Company will include such stores in its same store pool in the second year after the stores achieve 80% sustained occupancy using market rates and incentives.

FORWARD LOOKING STATEMENTS:

When used in this news release, the words “intends,” “believes,” “expects,” “anticipates,” and similar expressions are intended to identify “forward-looking statements” within the meaning of that term in Section 27A of the Securities Act of 1933 and in Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause our actual results, performance or achievements to be materially different from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to, the effect of competition from new self-storage facilities, which would cause rents and occupancy rates to decline; risks associated with the COVID-19 global health crisis or similar events, including but not limited to (i) the impact to the health of our employees and/or customers, (ii) the negative impacts to the economy and to self-storage customers which could reduce the demand for self-storage or reduce our ability to collect rent, (iii) reducing or eliminating our ability to increase rents charged to our current or future customers, (iv) limiting our ability to collect rent from or evict past due customers, (v) we could see an increase in move-outs of longer-term customers due to the economic uncertainty and significant rise in unemployment resulting from the COVID-19 global health crisis which could lead to lower occupancies and reduced average rental rates as longer-term customers are replaced with new customers at lower rates, and (vi) potential negative impacts on the cost and availability of debt and equity which could have a negative impact on our capital and growth plans; the Company’s ability to evaluate, finance and integrate acquired self-storage facilities into the Company’s existing business and operations; the Company’s ability to effectively compete in the industry in which it does business; the Company’s existing indebtedness may mature in an unfavorable credit environment, preventing refinancing or forcing refinancing of the indebtedness on terms that are not as favorable as the existing terms; interest rates may fluctuate, impacting costs associated with the Company’s outstanding floating rate debt; the Company’s ability to comply with debt covenants; any future ratings on the Company’s debt instruments; regional concentration of the Company’s business may subject it to economic downturns in the states of Florida and Texas; the Company’s reliance on its call center; the Company’s cash flow may be insufficient to meet required payments of operating expenses, principal, interest and dividends; and tax law changes that may change the taxability of future income.

CONFERENCE CALL:

Life Storage will hold its First Quarter Earnings Release Conference Call at 9:00 a.m. Eastern Time on Wednesday, May 5, 2021. To help avoid connection delays, participants are encouraged to pre-register using this link. Anyone unable to pre-register may access the conference call at 888.506.0062 (domestic) or 973.528.0011 (international); passcode 680774 or request to be joined into the Life Storage call. Management will accept questions from registered financial analysts after prepared remarks; all others are encouraged to listen to the call via webcast by accessing the investor relations tab at lifestorage.com. The webcast will be archived for a period of 90 days; a telephone replay will also be available for 14 days by calling 877.481.4010 and entering passcode 40759.

ABOUT LIFE STORAGE, INC:

Life Storage, Inc. is a self-administered and self-managed equity REIT that is in the business of acquiring and managing self-storage facilities. Located in Buffalo, New York, the Company operates more than 950 storage facilities in 33 states and in the province of Ontario, Canada. The Company serves both residential and commercial storage customers with storage units rented by month. Life Storage consistently provides responsive service to more than 525,000 customers, making it a leader in the industry. For more information visit http://invest.lifestorage.com.

 
Life Storage, Inc.
Balance Sheet Data
(unaudited)
 

March 31,

 

December 31,
(dollars in thousands)

2021

 

2020
Assets
Investment in storage facilities:
Land

$

991,214

 

$

951,813

 

Building, equipment and construction in progress

 

4,612,622

 

 

4,378,510

 

 

5,603,836

 

 

5,330,323

 

Less: accumulated depreciation

 

(904,420

)

 

(873,178

)

Investment in storage facilities, net

 

4,699,416

 

 

4,457,145

 

Cash and cash equivalents

 

13,914

 

 

54,400

 

Accounts receivable

 

14,796

 

 

15,464

 

Receivable from joint ventures

 

520

 

 

1,064

 

Investment in joint ventures

 

140,415

 

 

143,042

 

Prepaid expenses

 

12,335

 

 

8,326

 

Intangible asset – in-place customer leases

 

6,226

 

 

5,409

 

Trade name

 

16,500

 

 

16,500

 

Other assets

 

26,639

 

 

26,498

 

Total Assets

$

4,930,761

 

$

4,727,848

 

 
Liabilities
Line of credit

$

43,000

 

$

–

 

Term notes, net

 

2,156,140

 

 

2,155,457

 

Accounts payable and accrued liabilities

 

95,708

 

 

112,654

 

Deferred revenue

 

20,120

 

 

17,416

 

Mortgages payable

 

37,596

 

 

37,777

 

Total Liabilities

 

2,352,564

 

 

2,323,304

 

 
Noncontrolling redeemable Operating Partnership Units at redemption value

 

28,707

 

 

26,446

 

 
Equity
Common stock

 

765

 

 

495

 

Additional paid-in capital

 

2,853,019

 

 

2,671,311

 

Accumulated deficit

 

(299,482

)

 

(288,667

)

Accumulated other comprehensive loss

 

(4,812

)

 

(5,041

)

Total Shareholders’ Equity

 

2,549,490

 

 

2,378,098

 

Total Liabilities and Shareholders’ Equity

$

4,930,761

 

$

4,727,848

 

 
 
Life Storage, Inc.
Consolidated Statements of Operations
(unaudited)
January 1, 2021 January 1, 2020
to to
(dollars in thousands, except share data) March 31, 2021 March 31, 2020
 
Revenues
Rental income

$

150,283

 

$

128,907

 

Other operating income

 

17,014

 

 

13,623

 

Management and acquisition fee income

 

4,590

 

 

4,413

 

Total operating revenues

 

171,887

 

 

146,943

 

 
Expenses
Property operations and maintenance

 

38,520

 

 

32,850

 

Real estate taxes

 

19,887

 

 

17,408

 

General and administrative

 

14,183

 

 

12,906

 

Depreciation and amortization

 

31,288

 

 

27,028

 

Amortization of in-place customer leases

 

2,071

 

 

1,302

 

Total operating expenses

 

105,949

 

 

91,494

 

 
Gain on sale of real estate

 

–

 

 

302

 

Income from operations

 

65,938

 

 

55,751

 

 
Other income (expense)
Interest expense (A)

 

(20,346

)

 

(20,246

)

Interest and dividend income

 

779

 

 

4

 

Equity in income of joint ventures

 

1,221

 

 

1,116

 

 
Net income

 

47,592

 

 

36,625

 

Net income attributable to noncontrolling interests in the Operating Partnership

 

(209

)

 

(192

)

Net income attributable to common shareholders

$

47,383

 

$

36,433

 

 
Earnings per common share attributable to common shareholders – basic

$

0.63

 

$

0.52

 

 
Earnings per common share attributable to common shareholders – diluted

$

0.63

 

$

0.52

 

 
Common shares used in basic earnings per share calculation

 

75,387,332

 

 

70,015,856

 

 
Common shares used in diluted earnings per share calculation

 

75,510,201

 

 

70,126,344

 

 
Dividends declared per common share

$

0.7400

 

$

0.7133

 

 
 
(A) Interest expense for the period ending March 31 consists of the following
Interest expense

$

19,743

 

$

19,632

 

Amortization of debt issuance costs

 

603

 

 

614

 

Total interest expense

$

20,346

 

$

20,246

 

 
 
Life Storage, Inc.
Computation of Funds From Operations (FFO) (1)
(unaudited)
January 1, 2021 January 1, 2020
to to
(dollars in thousands, except share data) March 31, 2021 March 31, 2020
 
Net income attributable to common shareholders

$

47,383

 

$

36,433

 

Noncontrolling interests in the Operating Partnership

 

209

 

 

192

 

Depreciation of real estate and amortization of intangible assets exclusive of debt issuance costs

 

32,819

 

 

27,742

 

Depreciation and amortization from unconsolidated joint ventures

 

1,202

 

 

1,795

 

Funds from operations allocable to noncontrolling interest in Operating Partnership

 

(359

)

 

(346

)

Funds from operations available to common shareholders

 

81,254

 

 

65,816

 

FFO per share – diluted

$

1.08

 

$

0.94

 

 
Adjustments to FFO
Gain on sale of land

 

–

 

 

(302

)

Acquisition fee

 

–

 

 

(217

)

Funds from operations resulting from non-recurring items allocable to noncontrolling interest in Operating Partnership

 

–

 

 

3

 

Adjusted funds from operations available to common shareholders

 

81,254

 

 

65,300

 

Adjusted FFO per share – diluted

$

1.08

 

$

0.93

 

 
Common shares – diluted

 

75,510,201

 

 

70,126,344

 

 
 
Life Storage, Inc.
Computation of Net Operating Income (2)
(unaudited)
January 1, 2021 January 1, 2020
to to
(dollars in thousands) March 31, 2021 March 31, 2020
 
Net Income

$

47,592

 

$

36,625

 

General and administrative

 

14,183

 

 

12,906

 

Depreciation and amortization

 

33,359

 

 

28,330

 

Gain on sale of real estate

 

–

 

 

(302

)

Interest expense

 

20,346

 

 

20,246

 

Interest and dividend income

 

(779

)

 

(4

)

Equity in income of joint ventures

 

(1,221

)

 

(1,116

)

Net operating income

$

113,480

 

$

96,685

 

 
Same store (4)

$

89,935

 

$

82,808

 

Net operating income related to tenant reinsurance

 

7,839

 

 

6,877

 

Other stores and management fee income

 

15,706

 

 

7,000

 

Total net operating income

$

113,480

 

$

96,685

 

 
 
Life Storage, Inc.
Quarterly Same Store Data (3) (4) 531 mature stores owned since 12/31/19
(unaudited)
January 1, 2021 January 1, 2020
to to Percentage
(dollars in thousands) March 31, 2021 March 31, 2020 Change Change
 
Revenues:
Rental income

$

133,144

$

124,111

$

9,033

 

7.3

%

Other operating income

 

1,593

 

1,494

 

99

 

6.6

%

Total operating revenues

 

134,737

 

125,605

 

9,132

 

7.3

%

 
Expenses:
Payroll and benefits

 

10,023

 

9,841

 

182

 

1.8

%

Real estate taxes

 

17,424

 

16,592

 

832

 

5.0

%

Utilities

 

3,793

 

3,620

 

173

 

4.8

%

Repairs and maintenance

 

4,702

 

4,046

 

656

 

16.2

%

Office and other operating expense

 

4,036

 

3,803

 

233

 

6.1

%

Insurance

 

1,524

 

1,506

 

18

 

1.2

%

Advertising

 

48

 

64

 

(16

)

-25.0

%

Internet marketing

 

3,252

 

3,325

 

(73

)

-2.2

%

Total operating expenses

 

44,802

 

42,797

 

2,005

 

4.7

%

 
Net operating income (2)

$

89,935

$

82,808

$

7,127

 

8.6

%

 
 
QTD Same store move ins

 

46,838

 

46,389

 

449

 

 
QTD Same store move outs

 

42,158

 

44,458

 

(2,300

)

 
 
Other Comparable Quarterly Same Store Data (4)
(unaudited)
January 1, 2021 January 1, 2020
to to Percentage
March 31, 2021 March 31, 2020 Change Change
2020 Same store pool (515 stores)
Revenues

$

130,422

$

121,522

$

8,900

7.3

%

Expenses

 

43,422

 

41,569

 

1,853

4.5

%

Net operating income

$

87,000

$

79,953

$

7,047

8.8

%

 
 
2019 Same store pool (502 stores)
Revenues

$

127,658

$

119,044

$

8,614

7.2

%

Expenses

 

42,263

 

40,536

 

1,727

4.3

%

Net operating income

$

85,395

$

78,508

$

6,887

8.8

%

 
 
Life Storage, Inc.
Other Data – unaudited Same Store (3) All Stores (5)

2021

2020

2021

2020

 
Weighted average quarterly occupancy

93.3

%

89.2

%

92.7

%

88.0

%

 
Occupancy at March 31

94.0

%

89.4

%

93.1

%

88.3

%

 
Rent per occupied square foot

$14.87

 

$14.68

 

$14.82

 

$14.60

 

 
Life Storage, Inc.
Other Data – unaudited (continued)
 
Investment in Storage Facilities: (unaudited)
The following summarizes activity in storage facilities during the three months ended March 31, 2021:
 
Beginning balance

$

5,330,323

 

Property acquisitions

 

263,299

 

Improvements and equipment additions:
Expansions

 

–

 

Roofing, paving, and equipment:
Stabilized stores

 

3,827

 

Recently acquired stores

 

462

 

Change in construction in progress (Total CIP $24.7 million)

 

6,024

 

Dispositions and Impairments

 

(99

)

Storage facilities at cost at period end

$

5,603,836

 

 
 
 
Comparison of Selected G&A Costs (unaudited) Quarter Ended
March 31, 2021 March 31, 2020
 
Management and administrative salaries and benefits

$

8,612

 

$

7,521

Training

 

102

 

 

208

Call center

 

700

 

 

731

Life Storage Solutions costs

 

299

 

 

207

Income taxes

 

573

 

 

796

Legal, accounting and professional

 

1,063

 

 

1,074

Other administrative expenses (6)

 

2,834

 

 

2,369

$

14,183

 

$

12,906

 
Net rentable square feet March 31, 2021
Wholly owned properties

 

44,477,765

 

Joint venture properties

 

6,679,639

 

Third party managed properties

 

18,762,599

 

 

69,920,003

 

 
March 31, 2021 March 31, 2020
 
Common shares outstanding

 

76,477,796

 

 

70,353,546

Operating Partnership Units outstanding

 

333,398

 

 

365,949

 

(1) We believe that Funds from Operations (“FFO”) provides relevant and meaningful information about our operating performance that is necessary, along with net earnings and cash flows, for an understanding of our operating results. FFO adds back historical cost depreciation, which assumes the value of real estate assets diminishes predictably in the future. In fact, real estate asset values increase or decrease with market conditions. Consequently, we believe FFO is a useful supplemental measure in evaluating our operating performance by disregarding (or adding back) historical cost depreciation.

Funds from operations is defined by the National Association of Real Estate Investment Trusts, Inc. (“NAREIT”) as net income available to common shareholders computed in accordance with generally accepted accounting principles (“GAAP”), excluding gains or losses on sales of properties, plus impairment of real estate assets, plus depreciation and amortization and after adjustments to record unconsolidated partnerships and joint ventures on the same basis. We believe that to further understand our performance, FFO should be compared with our reported net income and cash flows in accordance with GAAP, as presented in our consolidated financial statements.

Our computation of FFO may not be comparable to FFO reported by other REITs or real estate companies that do not define the term in accordance with the current NAREIT definition or that interpret the current NAREIT definition differently. FFO does not represent cash generated from operating activities determined in accordance with GAAP, and should not be considered as an alternative to net income (determined in accordance with GAAP) as an indication of our performance, as an alternative to net cash flows from operating activities (determined in accordance with GAAP) as a measure of our liquidity, or as an indicator of our ability to make cash distributions.

(2) Net operating income or “NOI” is a non-GAAP (generally accepted accounting principles) financial measure that we define as total continuing revenues less continuing property operating expenses. NOI also can be calculated by adding back to net income: interest expense, impairment and casualty losses, operating lease expenses, depreciation and amortization expense, any losses on sale of real estate, acquisition related costs, general and administrative expense, and deducting from net income: income from discontinued operations, interest income, any gains on sale of real estate, and equity in income of joint ventures. We believe that NOI is a meaningful measure to investors in evaluating our operating performance, because we utilize NOI in making decisions with respect to capital allocations, in determining current property values, and in comparing period-to-period and market-to-market property operating results. Additionally, NOI is widely used in the real estate industry and the self-storage industry to measure the performance and value of real estate assets without regard to various items included in net income that do not relate to or are not indicative of operating performance, such as depreciation and amortization, which can vary depending on accounting methods and book value of assets. NOI should be considered in addition to, but not as a substitute for, other measures of financial performance reported in accordance with GAAP, such as total revenues, operating income and net income.

(3) Includes the stores owned and/or managed by the Company for the entire periods presented that are consolidated in our financial statements. Does not include unconsolidated joint ventures or other stores managed by the Company.

(4) Revenues and expenses do not include items related to tenant reinsurance.

(5) Does not include unconsolidated joint venture stores or other stores managed by the Company.

(6) Other administrative expenses include office rent, travel expense, investor relations and miscellaneous other expenses.

Life Storage, Inc.

David Dodman

(716) 229-8284

[email protected]

KEYWORDS: United States North America New York

INDUSTRY KEYWORDS: REIT Building Systems Other Construction & Property Commercial Building & Real Estate Construction & Property

MEDIA:

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Globus Medical Reports First Quarter 2021 Results

AUDUBON, Pa., May 04, 2021 (GLOBE NEWSWIRE) — Globus Medical, Inc. (NYSE: GMED), a leading musculoskeletal solutions company, today announced its financial results for the quarter ended March 31, 2021.

  • Worldwide net sales were $227.3 million, an increase of 19.3% as compared to the first quarter of 2020
  • GAAP net income for the quarter was $45.3 million, or 19.9% of net sales, which is an increase of 74.7% as compared to the first quarter of 2020
  • GAAP diluted earnings per share (“EPS”) was $0.44 and non-GAAP diluted EPS was $0.49
  • Non-GAAP adjusted EBITDA was $81.0 million, or 35.2% of net sales

“We got off to a great start in the first quarter, continuing the momentum we established in 2020,” said Dave Demski, President and CEO. “On a day-adjusted basis, our U.S. Spine business grew by almost 22% over last year, as we continue to take meaningful market share. Pull through from robotics; contributions from new product introductions; a resurgence in our biologics business; and competitive recruiting were all factors driving growth. Enabling Technologies revenue increased 86%, as surgeon recognition of the clinical superiority of our robotic technology produced back-to-back quarters of strong year-over-year growth.”

Worldwide net sales for the first quarter of 2021 was $227.3 million, an as-reported increase of 19.3% over the first quarter of 2020, and an increase of 18.7% on a constant currency basis. U.S. net sales for the first quarter of 2021, including robotics, increased by 22.0% compared to the first quarter of 2020. International net sales for the first quarter of 2021 increased by 5.9% over the first quarter of 2020 as-reported and increased 2.1% on a constant currency basis.

GAAP net income for the first quarter of 2021 was $45.3 million, an increase of 74.7% over the same period last year. GAAP diluted EPS for the first quarter of 2021 was $0.44, compared to $0.25 for the first quarter 2020, an increase of 74.2%. Non-GAAP diluted EPS for the first quarter of 2021 was $0.49, compared to $0.29 in the first quarter of 2020, an increase of 66.9%.

The Company generated net cash from operating activities of $63.6 million and non-GAAP free cash flow of $49.9 million during the first quarter of 2021. Cash, cash equivalents and marketable securities were $838.4 million as of March 31, 2021. The Company remains debt free.

2021 Annual Guidance

The Company today increased guidance for full year 2021 net sales from $880 million to $925 million and non-GAAP diluted earnings per share of $1.83 to $1.89.

Conference Call Information

Globus Medical will hold a teleconference to discuss its first quarter 2021 results with the investment community at 4:30 p.m. Eastern Time today. Globus invites all interested parties to join the call by dialing:

1-855-533-7141 United States Participants
1-720-545-0060 International Participants
There is no pass code for the teleconference.

For interested parties who do not wish to ask questions, the teleconference will be webcast live and may be accessed through a link on the Globus Medical website at www.globusmedical.com/investors.

The call will be archived until Thursday, May 13, 2021. The audio archive can be accessed by calling 1-855-859-2056 in the U.S. or 1-404-537-3406 from outside the U.S. The passcode for the audio replay is 991-6828.

About Globus Medical, Inc.

Globus Medical, Inc. is a leading musculoskeletal solutions company based in Audubon, PA. The company was founded in 2003 by an experienced team of professionals with a shared vision to create products that enable surgeons to promote healing in patients with musculoskeletal disorders. Additional information can be accessed at www.globusmedical.com.

Non-GAAP Financial Measures

To supplement our financial statements prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”), management uses certain non-GAAP financial measures. For example, non-GAAP Adjusted EBITDA, which represents net income before interest income, net and other non-operating expenses, provision for income taxes, depreciation and amortization, stock-based compensation expense, provision for litigation, acquisition related costs/licensing, and acquisition of in-process research and development, is useful as an additional measure of operating performance, and particularly as a measure of comparative operating performance from period to period, as it is reflective of changes in pricing decisions, cost controls and other factors that affect operating performance, and it removes the effect of our capital structure, asset base, income taxes and interest income and expense. Our management also uses non-GAAP Adjusted EBITDA for planning purposes, including the preparation of our annual operating budget and financial projections. Provision for litigation represents costs incurred for litigation settlements or unfavorable verdicts when the loss is known or considered probable and the amount can be reasonably estimated, or in the case of a favorable settlement, when income is realized. Acquisition related costs/licensing represents the change in fair value of business-acquisition-related contingent consideration; costs related to integrating recently acquired businesses, including but not limited to costs to exit or convert contractual obligations, severance, and information system conversion; and specific costs related to the consummation of the acquisition process such as banker fees, legal fees, and other acquisition related professional fees, as well as one-time licensing fees. Acquisition of in-process research and development represents the expensing of acquired assets with no alternative future use and related fees.

In addition, for the period ended March 31, 2021 and for other comparative periods, we are presenting non-GAAP net income and non-GAAP Diluted Earnings Per Share, which represent net income and diluted earnings per share excluding the provision for litigation, amortization of intangibles, acquisition related costs/licensing, acquisition of in-process research and development, and the tax effects of all of the foregoing adjustments. The tax effect adjustment represents the tax effect of the pre-tax non-GAAP adjustments excluded from non-GAAP net income. The tax impact of the non-GAAP adjustments is calculated based on the consolidated effective tax rate on a GAAP basis, applied to the non-GAAP adjustments, unless the underlying item has a materially different tax treatment, in which case the estimated tax rate applicable to the adjustment is used. We believe these non-GAAP measures are also useful indicators of our operating performance, and particularly as additional measures of comparative operating performance from period to period as they remove the effects of litigation, amortization of intangibles, acquisition related costs/licensing, acquisition of in-process research and development, and the tax effects of all of the foregoing adjustments, which we believe are not reflective of underlying business trends. Additionally, for the period ended March 31, 2021 and for other comparative periods, we also define the non-GAAP measure of free cash flow as the net cash provided by operating activities, adjusted for the impact of restricted cash, less the cash impact of purchases of property and equipment.  We believe that this financial measure provides meaningful information for evaluating our overall financial performance for comparative periods as it facilitates an assessment of funds available to satisfy current and future obligations and fund acquisitions.  Furthermore, the non-GAAP measure of constant currency net sales growth is calculated by translating current year net sales at the same average exchange rates in effect during the applicable prior year period.  We believe constant currency net sales growth provides insight to the comparative increase or decrease in period net sales, in dollar and percentage terms, excluding the effects of fluctuations in foreign currency exchange rates.

Non-GAAP adjusted EBITDA, non-GAAP net income, non-GAAP diluted earnings per share, free cash flow and constant currency net sales growth are not calculated in conformity with U.S. GAAP.  Non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as a substitute for financial measures prepared in accordance with U.S. GAAP.  These measures do not include certain expenses that may be necessary to evaluate our liquidity or operating results.  Our definitions of non-GAAP adjusted EBITDA, non-GAAP net income, non-GAAP diluted earnings per share, free cash flow and constant currency net sales growth may differ from that of other companies and therefore may not be comparable.
Safe Harbor Statements

All statements included in this press release other than statements of historical fact are forward-looking statements and may be identified by their use of words such as “believe,” “may,” “might,” “could,” “will,” “aim,” “estimate,” “continue,” “anticipate,” “intend,” “expect,” “plan” and other similar terms. These forward-looking statements are based on our current assumptions, expectations and estimates of future events and trends. Forward-looking statements are only predictions and are subject to many risks, uncertainties and other factors that may affect our businesses and operations and could cause actual results to differ materially from those predicted. These risks and uncertainties include, but are not limited to, health epidemics, pandemics and similar outbreaks, including the COVID-19 pandemic, factors affecting our quarterly results, our ability to manage our growth, our ability to sustain our profitability, demand for our products, our ability to compete successfully (including without limitation our ability to convince surgeons to use our products and our ability to attract and retain sales and other personnel), our ability to rapidly develop and introduce new products, our ability to develop and execute on successful business strategies, our ability to comply with laws and regulations that are or may become applicable to our businesses, our ability to safeguard our intellectual property, our success in defending legal proceedings brought against us, trends in the medical device industry, general economic conditions, and other risks. For a discussion of these and other risks, uncertainties and other factors that could affect our results, you should refer to the disclosure contained in our most recent annual report on Form 10-K filed with the Securities and Exchange Commission, including the sections labeled “Risk Factors” and “Cautionary Note Concerning Forward-Looking Statements,” and in our Forms 10-Q, Forms 8-K and other filings with the Securities and Exchange Commission. These documents are available at www.sec.gov. Moreover, we operate in an evolving environment. New risk factors and uncertainties emerge from time to time and it is not possible for us to predict all risk factors and uncertainties, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Given these risks and uncertainties, readers are cautioned not to place undue reliance on any forward-looking statements. Forward-looking statements contained in this press release speak only as of the date of this press release. We undertake no obligation to update any forward-looking statements as a result of new information, events or circumstances or other factors arising or coming to our attention after the date hereof.

GLOBUS MEDICAL, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(unaudited)

    Three Months Ended
    March 31,

(In thousands, except per share amounts)
 		  2021     2020  
Net sales   $ 227,344     $ 190,577  
Cost of goods sold     55,027       48,864  
Gross profit     172,317       141,713  
             
Operating expenses:            
Research and development     14,924       15,402  
Selling, general and administrative     97,891       93,539  
Provision for litigation     (94 )     —  
Amortization of intangibles     4,774       3,776  
Acquisition related costs     274       548  
Total operating expenses     117,769       113,265  
             
Operating income/(loss)     54,548       28,448  
             
Other income/(expense), net            
Interest income/(expense), net     2,712       4,324  
Foreign currency transaction gain/(loss)     (280 )     (468 )
Other income/(expense)     214       194  
Total other income/(expense), net     2,646       4,050  
             
Income/(loss) before income taxes     57,194       32,498  
Income tax provision     11,865       6,549  
             
Net income/(loss)   $ 45,329     $ 25,949  
             
Other comprehensive income/(loss):            
Unrealized gain/(loss) on marketable securities, net of tax     (1,666 )     (3,842 )
Foreign currency translation gain/(loss)     (4,113 )     474  
Total other comprehensive income/(loss)     (5,779 )     (3,368 )
Comprehensive income/(loss)   $ 39,550     $ 22,581  
             
Earnings per share:            
Basic   $ 0.45     $ 0.26  
Diluted   $ 0.44     $ 0.25  
Weighted average shares outstanding:            
Basic     99,866       99,635  
Diluted     102,420       102,146  
             

GLOBUS MEDICAL, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(unaudited)

    March 31,   December 31,

(In thousands, except share and per share values)
 		  2021    2020
ASSETS            
Current assets:            
Cash, cash equivalents, and restricted cash   $ 184,848     $ 239,397
Short-term marketable securities     218,711       187,344
Accounts receivable, net of allowances of $4,358 and $4,408, respectively     160,939       141,676
Inventories     232,007       229,153
Prepaid expenses and other current assets     16,132       17,771
Income taxes receivable     1,736       6,424
Total current assets     814,373       821,765
Property and equipment, net of accumulated depreciation of $282,346 and $276,451, respectively     216,186       216,879
Long-term marketable securities     434,877       358,522
Intangible assets, net     80,414       86,949
Goodwill     155,373       156,716
Other assets     28,693       32,039
Deferred income taxes     7,974       6,615
Total assets   $ 1,737,890     $ 1,679,485
             
LIABILITIES AND EQUITY            
Current liabilities:            
Accounts payable   $ 22,409     $ 18,205
Accrued expenses     69,908       78,334
Income taxes payable     8,434       1,101
Business acquisition liabilities     6,048       5,777
Deferred revenue     8,653       8,125
Payable to broker     8,225       9,250
Total current liabilities     123,677       120,792
Business acquisition liabilities, net of current portion     29,973       31,493
Deferred income taxes     5,925       6,202
Other liabilities     15,321       14,701
Total liabilities     174,896       173,188
             
Equity:            
Class A common stock; $0.001 par value. Authorized 500,000,000 shares; issued and outstanding 77,587,013 and 77,284,007 shares at March 31, 2021 and December 31, 2020, respectively     78       77
Class B common stock; $0.001 par value. Authorized 275,000,000 shares; issued and outstanding 22,430,097 shares at March 31, 2021 and December 31, 2020     22       22
Additional paid-in capital     474,307       457,161
Accumulated other comprehensive income (loss)     (1,824 )     3,955
Retained earnings     1,090,411       1,045,082
Total equity     1,562,994       1,506,297
Total liabilities and equity   $ 1,737,890     $ 1,679,485
               

GLOBUS MEDICAL, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)

    Three Months Ended
    March 31,

(In thousands)
 		  2021     2020  
Cash flows from operating activities:            
Net income   $ 45,329     $ 25,949  
Adjustments to reconcile net income to net cash provided by operating activities:            
Depreciation and amortization     17,157       14,568  
Amortization of premium (discount) on marketable securities     520       20  
Write-down of excess and obsolete inventories     1,550       679  
Stock-based compensation expense     7,698       6,807  
Allowance for doubtful accounts     80       756  
Change in fair value of business acquisition liabilities     258       506  
Change in deferred income taxes     (808 )     (2,895 )
(Gain)/loss on disposal of assets, net     103       207  
(Increase)/decrease in:            
Accounts receivable     (20,346 )     14,131  
Inventories     (3,997 )     (12,108 )
Prepaid expenses and other assets     4,516       (205 )
Increase/(decrease) in:            
Accounts payable     4,212       (283 )
Accrued expenses and other liabilities     (4,783 )     (13,702 )
Income taxes payable/receivable     12,081       7,863  
Net cash provided by operating activities     63,570       42,293  
Cash flows from investing activities:            
Purchases of marketable securities     (185,110 )     (57,418 )
Maturities of marketable securities     39,850       71,766  
Sales of marketable securities     33,818       5,374  
Purchases of property and equipment     (13,672 )     (22,314 )
Net cash used in investing activities     (125,114 )     (2,592 )
Cash flows from financing activities:            
Payment of business acquisition related liabilities     (1,537 )     (566 )
Proceeds from exercise of stock options     9,101       5,763  
Repurchase of common stock     —       (73,864 )
Net cash used in/provided by financing activities     7,564       (68,667 )
Effect of foreign exchange rates on cash     (569 )     (16 )
Net increase in cash, cash equivalents, and restricted cash     (54,549 )     (28,982 )
Cash, cash equivalents, and restricted cash at beginning of period     239,397       195,724  
Cash, cash equivalents, and restricted cash at end of period   $ 184,848     $ 166,742  
Supplemental disclosures of cash flow information:            
Income taxes paid   $ 570     $ 1,791  
Purchases of property and equipment included in accounts payable and accrued expenses   $ 2,620     $ 5,287  

Supplemental Financial Information

Net Sales by Geographic Area:

    Three Months Ended
    March 31,

(In thousands)
 		  2021   2020
United States   $ 193,317   $ 158,447
International     34,027     32,130
Total net sales   $ 227,344   $ 190,577
             

Net Sales by Product Category:

    Three Months Ended
    March 31,

(In thousands)
 		  2021   2020
Musculoskeletal Solutions   $ 212,416   $ 182,542
Enabling Technologies     14,928     8,035
Total net sales   $ 227,344   $ 190,577
             

Liquidity and Capital Resources:

    March 31,   December 31,

(In thousands)
 		  2021   2020
Cash, cash equivalents, and restricted cash   $ 184,848   $ 239,397
Short-term marketable securities     218,711     187,344
Long-term marketable securities     434,877     358,522
Total cash, cash equivalents, restricted cash and marketable securities   $ 838,436   $ 785,263
             

The following tables reconcile GAAP to Non-GAAP financial measures.

Non-GAAP Adjusted EBITDA Reconciliation Table:

    Three Months Ended
    March 31,

(In thousands, except percentages)
 		  2021     2020  
Net income/(loss)   $ 45,329     $ 25,949  
Interest income/(expense), net     (2,712 )     (4,324 )
Provision for income taxes     11,865       6,549  
Depreciation and amortization     17,157       14,568  
EBITDA     71,639       42,742  
Stock-based compensation expense     7,698       6,807  
Provision for litigation     (94 )     —  
Acquisition related costs/licensing     883       957  
Adjusted EBITDA   $ 80,126     $ 50,506  
             

Net income as a percentage of net sales
 		    19.9 %     13.6 %
Adjusted EBITDA as a percentage of net sales     35.2 %     26.5 %

Non-GAAP Net Income Reconciliation Table:

    Three Months Ended
    March 31,

(In thousands)
 		  2021     2020  
Net income/(loss)   $ 45,329     $ 25,949  
Provision for litigation     (94 )     —  
Amortization of intangibles     4,774       3,776  
Acquisition related costs/licensing     883       957  
Tax effect of adjusting items     (1,154 )     (956 )
Non-GAAP net income   $ 49,738     $ 29,726  
                 

Non-GAAP Diluted Earnings Per Share Reconciliation Table:

    Three Months Ended
    March 31,

(Per share amounts)
 		  2021     2020  
Diluted earnings per share, as reported   $ 0.44     $ 0.25  
Provision for litigation     —       —  
Amortization of intangibles     0.05       0.04  
Acquisition related costs/licensing     0.01       0.01  
Tax effect of adjusting items     (0.01 )     (0.01 )
Non-GAAP diluted earnings per share   $ 0.49     $ 0.29  
                 

* Amounts might not add due to rounding

Non-GAAP Free Cash Flow Reconciliation Table:

    Three Months Ended
    March 31,

(In thousands)
 		  2021     2020  
Net cash provided by operating activities   $ 63,570     $ 42,293  
Purchases of property and equipment     (13,672 )     (22,314 )
Free cash flow   $ 49,898     $ 19,979  
                 

Net Sales on a Constant Currency Basis Comparative Table:

    Three Months Ended   Reported   Currency

Impact on  		  Constant

Currency
    March 31,   Net Sales   Current   Net Sales

(In thousands, except percentages)
 		  2021   2020   Growth   Period Net Sales   Growth
United States   $ 193,317   $ 158,447   22.0 %   $ —   22.0 %
International     34,027     32,130   5.9 %     1,208   2.1 %
Total net sales   $ 227,344   $ 190,577   19.3 %   $ 1,208   18.7 %
                               


Contact

:

Brian Kearns
Senior Vice President, Business Development and Investor Relations
Phone: (610) 930-1800
Email: [email protected] 
www.globusmedical.com 



Posted on

UGI Appoints VP, Talent Management and Diversity & Inclusion; Continues to Advance its Commitment to Belonging, Inclusion, Diversity and Equity

UGI Appoints VP, Talent Management and Diversity & Inclusion; Continues to Advance its Commitment to Belonging, Inclusion, Diversity and Equity

VALLEY FORGE, Pa.–(BUSINESS WIRE)–
UGI Corporation (NYSE: UGI) announced today that Kimberly Bankston has been appointed Vice President, Talent Management and Diversity & Inclusion, effective April 19, 2021. In this role, Ms. Bankston is responsible for leading UGI’s belonging, inclusion, diversity and equity (BIDE) initiative in addition to the leadership and talent management functions. Ms. Bankston will champion diversity, equity and inclusion within UGI, drive excellence, accountability and transparency, and develop strategies and programs that integrate BIDE in all facets of the organization.

Ms. Bankston most recently served as Vice President, Human Resource Services at General Atomics. She brings over 25 years of experience leading HR, global talent development and diversity & inclusion. Prior to joining General Atomics in 2019, Ms. Bankston served in senior HR leadership roles with several divisions of General Electric and served as the Global Executive, Diversity and Inclusion at GE Capital.

“We are excited to welcome Kim to the UGI family of companies in this role that is crucial to our future success,” said John L. Walsh, President and Chief Executive Officer of UGI Corporation. “The appointment of Kim underscores our commitment to creating a diverse and inclusive workplace, where our entire team feels a sense of belonging and appreciation for the diversity of thought, perspective and experiences that they bring to UGI. Kim brings extensive experience and passion to this new role, and I look forward to her guidance as we build an even stronger company that drives positive change within UGI and the communities that we serve.”

“There is great energy from the UGI leadership and employees to successfully move the BIDE initiative forward,” said Kim. “Working collaboratively internally and with external partnerships we can make a lasting and significant impact at such a critical time.”

About UGI Corporation

UGI Corporation is a distributor and marketer of energy products and services. Through subsidiaries, UGI operates natural gas and electric utilities in Pennsylvania, distributes LPG both domestically (through AmeriGas) and internationally (through UGI International), manages midstream energy assets in Pennsylvania, Ohio, and West Virginia and electric generation assets in Pennsylvania, and engages in energy marketing, including renewable natural gas, in twelve states and the District of Columbia and internationally in France, Belgium, the Netherlands and the UK.

Comprehensive information about UGI Corporation is available on the Internet at https://www.ugicorp.com.

Investor Relations

Tameka Morris, 610-456-6297

Arnab Mukherjee, 610-768-7498

Shelly Oates, 610-992-3202

KEYWORDS: United States North America Pennsylvania

INDUSTRY KEYWORDS: Oil/Gas Energy Professional Services Human Resources Utilities

MEDIA:

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Posted on

Franchise Group, Inc. Announces the Election of Two New Independent Directors

ORLANDO, Fla., May 04, 2021 (GLOBE NEWSWIRE) — Franchise Group, Inc. (NASDAQ: FRG) (“Franchise Group” or the “Company”) today announced that its shareholders elected Lisa Fairfax and Cynthia Dubin to its Board of Directors (“Board”). Ms. Fairfax will serve as the Chair of the Nominating & Corporate Governance Committee of the Board. Ms. Dubin will serve as the Chair of the Audit Committee and as a member of the Compensation Committee and the Risk Committee of the Board. Following the appointments of Ms. Fairfax and Ms. Dubin, the Board will comprise six directors, five of whom are independent.

“We are very pleased to have directors with the experience of Lisa and Cynthia join our Board of Directors,” said Matthew Avril, the Company’s Board Chairman. “Our Board regularly evaluates its composition to ensure it includes the appropriate skills, experience and perspectives necessary to drive growth and oversee the business. The addition of Cynthia and Lisa reflect that commitment as we continue to grow our business and enhance value for our shareholders.”

About Cynthia S. Dubin

Ms. Dubin is an experienced chief financial officer and board director. She currently has a portfolio of board roles which include a chemicals company, a UK competition regulator, a financial exchange and an industrial technology company. Ms Dubin is Audit Committee Chair and member of the Remuneration Committee at Synthomer plc, a London Stock Exchange-listed global chemicals company. She is the Interim-Chair of the Audit and Risk Assurance Committee and Chair of the Nominations Committee at the UK Competition and Markets Authority, a non-ministerial government department, responsible for strengthening business competition. She is a member of the Risk and Audit Committee of ICE Futures Europe’s board, a London-based exchange and subsidiary of ICE (NYSE-listed) that hosts futures and options contracts in energy, interest rates, equities and soft commodities. At Nasdaq-listed Hurco Group, an industrial technology company, she is a member of the Audit Committee. Ms Dubin started her career in banking and thereafter became a chief financial officer for US and UK companies. She holds a BSBA from Georgetown University with honors.

About Lisa M. Fairfax

Ms. Fairfax is currently a tenured and chaired professor at the George Washington University Law School (“GW”) where she is the Alexander Hamilton Professor of Business Law, and the Founder and Director of the GW Corporate Law and Governance Initiative. Ms. Fairfax has served as an appointed member of the Investor Advisory Committee of the Securities and Exchange Commission (“SEC”), a member of the National Adjudicatory Council of the Financial Industry Regulation Authority (“FINRA”), and a member of FINRA’s NASDAQ Market Regulation Committee. Ms. Fairfax is an active member of the community and is currently the Chair of the Board of Georgetown Day School, on the Board of DirectWomen, and is an elected member of the American Law Institute (“ALI”). Prior to joining GW, Ms. Fairfax was a tenured professor and Director of the Business Law Program at the University of Maryland School of Law and practiced corporate and securities law with Ropes & Gray LLP. Ms. Fairfax received a Juris Doctorate from Harvard Law School with honors and an A.B. from Harvard College with honors.

About Franchise Group, Inc.

Franchise Group is an owner and operator of franchised and franchisable businesses that continually looks to grow its portfolio of brands while utilizing its operating and capital allocation philosophies to generate strong cash flow for its shareholders. Franchise Group’s business lines include Pet Supplies Plus, American Freight, The Vitamin Shoppe, Buddy’s Home Furnishings, and Liberty Tax Service. On a combined basis, Franchise Group currently operates over 4,600 locations predominantly located in the U.S. and Canada that are either Company-run or operated pursuant to franchising agreements.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, projections, predictions, expectations, or beliefs about future events or results and are not statements of historical fact. Such forward-looking statements are based on various assumptions as of the time they are made, and are inherently subject to known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements are often accompanied by words that convey projected future events or outcomes such as “expect,” “believe,” “estimate,” “plan,” “project,” “anticipate,” “intend,” “will,” “may,” “view,” “opportunity,” “potential,” or words of similar meaning or other statements concerning opinions or judgment of the Company or its management about future events. Although the Company believes that its expectations with respect to forward-looking statements are based upon reasonable assumptions within the bounds of its existing knowledge of its business and operations, there can be no assurance that actual results, performance, or achievements of the Company will not differ materially from any projected future results, performance or achievements expressed or implied by such forward-looking statements. Actual future results, performance or achievements may differ materially from historical results or those anticipated depending on a variety of factors, many of which are beyond the control of the Company. We refer you to the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s Annual Report on Form 10-K for the period ended December 26, 2020, and comparable sections of the Company’s Quarterly Reports on Form 10-Q and other filings, which have been filed with the SEC and are available on the SEC’s website at www.sec.gov. All of the forward-looking statements made in this press release are expressly qualified by the cautionary statements contained or referred to herein. The actual results or developments anticipated may not be realized or, even if substantially realized, they may not have the expected consequences to or effects on the Company or its business or operations. Readers are cautioned not to rely on the forward-looking statements contained in this press release. Forward-looking statements speak only as of the date they are made and the Company does not undertake any obligation to update, revise or clarify these forward-looking statements, whether as a result of new information, future events or otherwise.

INVESTOR RELATIONS CONTACT:

Andrew F. Kaminsky
EVP & Chief Administrative Officer
Franchise Group, Inc.
[email protected]
(914) 939-5161

 



Posted on

Eagle Point Credit Company Inc. Schedules Release of First Quarter 2021 Financial Results on Tuesday, May 18, 2021

Eagle Point Credit Company Inc. Schedules Release of First Quarter 2021 Financial Results on Tuesday, May 18, 2021

GREENWICH, Conn.–(BUSINESS WIRE)–
Eagle Point Credit Company Inc. (the “Company”) (NYSE:ECC, ECCB, ECCW, ECCX, ECCY) today announced that it plans to report financial results for the quarter ended March 31, 2021 prior to the opening of the financial markets on Tuesday, May 18, 2021.

The Company will discuss its financial results on a conference call on that day at 10:00 a.m. (Eastern Time). Thomas P. Majewski, Chief Executive Officer, will host the call along with Kenneth P. Onorio, Chief Financial Officer.

All interested parties are welcome to participate in the conference call via one of the following methods:

PHONE:

 

Dial (877) 407-0789 (domestic) or (201) 689-8562 (international), and reference Conference ID 13719176. All participants are asked to dial-in to the conference call 10 to 15 minutes prior to the call so that their name and company information can be collected.

 

INTERNET:

Please go to the Investor Relations section of the Company’s website (www.eaglepointcreditcompany.com) at least 15 minutes prior to the call to register for the call and download and install any necessary audio software.

 

REPLAY:

An archived replay of the call will be made available shortly after the call on the Investor Relations section of the Company’s website, and will remain available for approximately 30 days. A replay will also be available following the end of the call through Friday, June 18, 2021, by telephone at (844) 512-2921 (toll-free) or (412) 317-6671 (international), replay pin number 13719176.

About Eagle Point Credit Company

The Company is a non-diversified, closed-end management investment company. The Company’s primary investment objective is to generate high current income, with a secondary objective to generate capital appreciation, primarily through investment in equity and junior debt tranches of collateralized loan obligations. The Company is externally managed and advised by Eagle Point Credit Management LLC.

The Company makes certain unaudited portfolio information available each month on its website in addition to making certain other unaudited financial information available on its website (www.eaglepointcreditcompany.com). This information includes (1) an estimated range of the Company’s net investment income (“NII”) and realized capital gains or losses per share of common stock for each calendar quarter end, generally made available within the first fifteen days after the applicable calendar month end, (2) an estimated range of the Company’s net asset value (“NAV”) per share of common stock for the prior month end and certain additional portfolio-level information, generally made available within the first fifteen days after the applicable calendar month end, and (3) during the latter part of each month, an updated estimate of NAV, if applicable, and, with respect to each calendar quarter end, an updated estimate of the Company’s NII and realized capital gains or losses per share for the applicable quarter, if available.

FORWARD-LOOKING STATEMENTS

This press release may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Statements other than statements of historical facts included in this press release may constitute forward-looking statements and are not guarantees of future performance or results and involve a number of risks and uncertainties. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described in the prospectus and the Company’s other filings with the Securities and Exchange Commission. The Company undertakes no duty to update any forward-looking statement made herein. All forward-looking statements speak only as of the date of this press release.

Source: Eagle Point Credit Company Inc.

Investor and Media Relations:

ICR

203-340-8510

[email protected]

www.eaglepointcreditcompany.com

KEYWORDS: United States North America Connecticut

INDUSTRY KEYWORDS: Consulting Banking Professional Services Finance

MEDIA:

Posted on

Sykes Enterprises, Incorporated Issues Notice Of Release For First Quarter 2021 Financial Results

First-quarter 2021 financial results press release now posted to SYKES’ website

TAMPA, Fla., May 04, 2021 (GLOBE NEWSWIRE) — Sykes Enterprises, Incorporated (“SYKES” or the “Company”) (NASDAQ: SYKE), a leading full life cycle provider of global customer experience management services, multichannel demand generation and digital transformation, has released its financial results for the first-quarter ended March 31, 2021. The first-quarter 2021 financial results can be viewed at either www.sykes.com, under the “Investor News” section, or using the following link: http://investor.sykes.com/company/investors/investor-news/default.aspx.

Forward-Looking Statements

This press release may contain “forward-looking statements,” including SYKES’ estimates of its future business outlook, prospects or financial results. Statements regarding SYKES’ objectives, expectations, intentions, beliefs or strategies, or statements containing words such as “believe,” “estimate,” “project,” “expect,” “intend,” “may,” “anticipate,” “plans,” “seeks,” “implies,” or similar expressions are intended to identify such forward-looking statements. It is important to note that SYKES’ actual results could differ materially from those in such forward-looking statements, and undue reliance should not be placed on such statements. Statements about the effects of the COVID-19 pandemic on our business, operations, financial performance and prospects may constitute forward-looking statements and are subject to the risk that the actual impacts may differ, possibly materially, from what is reflected in those forward-looking statements due to factors and future developments that are uncertain, unpredictable and in many cases beyond our control, including the scope and duration of the pandemic, actions taken by governmental authorities in response to the pandemic, and the direct and indirect impact of the pandemic on our clients, third parties and us. Among the important factors that could cause such actual results to differ materially are (i) the impact of economic recessions in the U.S. and other parts of the world, (ii) fluctuations in global business conditions and the global economy, (iii) SYKES’ ability of maintaining margins, (iv) SYKES’ ability to continue the growth of its support service revenues through additional technical and customer experience management centers, (v) currency fluctuations, (vi) the timing of significant orders for SYKES’ products and services, (vii) loss or addition of significant clients, (viii) the early termination of contracts by clients, (ix) SYKES’ ability to recognize deferred revenue through delivery of products or satisfactory performance of services, (x) construction delays of new or expansion of existing customer experience management centers, (xi) difficulties or delays in implementing SYKES’ bundled service offerings, (xii) failure to achieve sales, marketing and other objectives, (xiii) variations in the terms and the elements of services offered under SYKES’ standardized contract including those for future bundled service offerings, (xiv) changes in applicable accounting principles or interpretations of such principles, (xv) delays in SYKES’ ability to develop new products and services and market acceptance of new products and services, (xvi) rapid technological change, (xvii) political and country-specific risks inherent in conducting business abroad, (xviii) SYKES’ ability to attract and retain key management personnel, (xix) SYKES’ ability to further penetrate into vertically integrated markets, (xx) SYKES’ ability to expand its global presence through strategic alliances and selective acquisitions, (xxi) SYKES’ ability to continue to establish a competitive advantage through sophisticated technological capabilities, (xxii) the ultimate outcome of any lawsuits or penalties (regulatory or otherwise), (xxiii) SYKES’ dependence on trends toward outsourcing, (xxiv) risk of interruption of technical and customer experience management center operations due to such factors as fire, earthquakes, inclement weather and other disasters, power failures, telecommunications failures, unauthorized intrusions, computer viruses and other emergencies, (xxv) the existence of substantial competition, (xxvi) the ability to obtain and maintain grants and other incentives, including tax holidays or otherwise, (xxvii) risks related to the integration of the businesses of SYKES, including the Qelp, Clearlink, WhistleOut, Symphony and Taylor Media Corp. (the owner of The Penny Hoarder) acquisitions and the impairment of any related goodwill, (xxviii) the ability to execute on initiatives to address inefficiencies around recruitment and retention in the U.S. and rationalize underutilized capacity methodically and (xxix) other risk factors listed from time to time in SYKES’ registration statements and reports as filed with the Securities and Exchange Commission. All forward-looking statements included in this press release are made as of the date hereof, and SYKES undertakes no obligation to update any such forward-looking statements, whether as a result of new information, future events, or otherwise.

About Sykes Enterprises, Incorporated

Sykes Enterprises, Incorporated and consolidated subsidiaries (“SYKES” or the “Company”) is a leading full lifecycle provider of global customer experience management services, multichannel demand generation and digital transformation. SYKES provides differentiated full lifecycle customer experience management solutions and services primarily to Global 2000 companies and their end customers principally in the financial services, technology, communications, transportation & leisure and healthcare industries. The Company’s differentiated full lifecycle services platform effectively engages customers at every touchpoint within the customer journey, including digital media and acquisition, sales expertise, customer service, technical support and retention, many of which can be optimized through a suite of digital transformation capabilities under its SYKES Digital Services (“SDS”) group, which spans robotic process automation (“RPA”), self-service, insight analytics and digital learning. In addition to digital transformation, SYKES also provides artificial intelligence (“AI”) solutions that can be embedded and leveraged across its lifecycle offerings. The Company serves its clients through two geographic operating regions: the Americas (United States, Canada, Latin America, Australia and the Asia Pacific Rim) and EMEA (Europe, the Middle East and Africa). The Company’s Americas and EMEA regions primarily provide customer management solutions and services with an emphasis on inbound multichannel demand generation, customer service and technical support to its clients’ customers. These services are delivered through multiple communication channels including phone, e-mail, social media, text messaging, chat and digital self-service. The Company also provides various enterprise support services in the United States that include services for its clients’ internal support operations, from technical staffing services to outsourced corporate help desk services. In Europe, the Company also provide fulfillment services, which include order processing, payment processing, inventory control, product delivery and product returns handling. Additionally, through the Company’s acquisition of RPA provider Symphony Ventures Ltd (“Symphony”) coupled with its investment in AI through XSell Technologies, Inc. (“XSell”), the Company also provides a suite of digital transformation capabilities that optimizes its differentiated full lifecycle management services platform. The Company’s complete service offering helps its clients acquire, retain and increase the lifetime value of their customer relationships. The Company has developed an extensive global reach with customer experience management centers across six continents, including North America, South America, Europe, Asia, Australia and Africa. The Company delivers cost-effective solutions that generate demand, enhance the customer service experience, promote stronger brand loyalty, and bring about high levels of performance and profitability. For additional information please visit www.sykes.com.

For additional information contact:

Subhaash Kumar
Sykes Enterprises, Incorporated
(813) 233-7143



Posted on

Workiva Inc. Announces First Quarter 2021 Financial Results

Workiva Inc. Announces First Quarter 2021 Financial Results

  • Increased Q1 2021 Subscription & Support Revenue by 24.2% over Q1 2020
  • Generated Total Q1 2021 Revenue of $104.2 Million, up 21.5% over Q1 2020
  • Achieved 48% YOY Growth of Customers with Annual Contract Value Over $150K
  • Expands Total Addressable Market with Launch of ESG Solution
  • Raises Full-Year 2021 Revenue Guidance

AMES, Iowa–(BUSINESS WIRE)–
Workiva Inc. (NYSE:WK), the company that simplifies complex work, today announced financial results for its first quarter ended March 31, 2021.

“We entered 2021 with strong momentum, which continued throughout the first quarter,” said Marty Vanderploeg, Chief Executive Officer. “Secular tailwinds from macro business trends, such as digital transformations, changes in the regulatory landscape, and remote workplaces, continue to generate strong demand for our open, intelligent and intuitive platform.”

“Last week we announced our newest fit-for-purpose solution, ESG,” added Vanderploeg. “ESG reporting is complex, making it a natural fit for our platform and a compelling market for us to enter. As companies address the rapidly evolving ESG disclosure requirements from company stakeholders, we believe ESG will drive global demand for our cloud platform and lead to an expansion of our total addressable market.”

“Our cloud technology transforms the way people manage and report business data with various collaborators, data sources, documents, and spreadsheets. As a result of improved market demand and an expanding addressable market, we are raising our full-year guidance,” said Jill Klindt, Chief Financial Officer.

First Quarter 2021 Financial Highlights

  • Revenue: Total revenue for the first quarter of 2021 reached$104.2 million, an increase of 21.5% from $85.8 million in the first quarter of 2020. Subscription and support revenue contributed $84.9 million, up 24.2% versus the first quarter of 2020. Professional services revenue was $19.3 million, an increase of 10.6% compared to the same quarter in the prior year.
  • Gross Profit: GAAP gross profit for the first quarter of 2021 was $80.5 million compared with $63.4 million in the same quarter of 2020. GAAP gross margin was 77.3% versus 73.9% in the first quarter of 2020. Non-GAAP gross profit for the first quarter of 2021 was $81.4 million, an increase of 26.7% compared with the prior year’s first quarter, and non-GAAP gross margin was 78.1% compared to 74.9% in the first quarter of 2020.
  • Results from Operations: GAAP loss from operations for the first quarter of 2021 was $4.1 million compared with a loss of $9.1 million in the prior year’s first quarter. Non-GAAP income from operations was $7.5 million, compared with non-GAAP income from operations of $0.9 million in the first quarter of 2020.
  • GAAP Net Loss: GAAP net loss for the first quarter of 2021 was $7.3 million compared with a net loss of $10.4 million for the prior year’s first quarter. GAAP net loss per basic and diluted share was $0.15 compared with a net loss per basic and diluted share of $0.22 in the first quarter of 2020.
  • Non-GAAP Net Income: Non-GAAP net income for the first quarter of 2021 was $6.6 million compared with net income of $1.7 million in the prior year’s first quarter. Non-GAAP net income per basic and diluted share was $0.13 and $0.12, respectively, compared with net income per basic and diluted share of $0.04 and $0.03, respectively, in the first quarter of 2020.
  • Liquidity: As of March 31, 2021, Workiva had cash, cash equivalents and marketable securities totaling $540.6 million, compared with $530.0 million as of December 31, 2020. Workiva had $345.0 million aggregate principal amount of 1.125% convertible senior notes due in 2026 and $17.9 million of finance lease obligations outstanding as of March 31, 2021.

Key Metrics and Recent Business Highlights

  • Customers: Workiva had 3,800 customers as of March 31, 2021, a net increase of 293 customers from March 31, 2020.
  • Revenue Retention Rate: As of March 31, 2021, Workiva’s revenue retention rate (excluding add-on revenue) was 95.1%, and the revenue retention rate including add-on revenue was 111.2%. Add-on revenue includes changes in both solutions and pricing for existing customers.
  • Large Contracts: As of March 31, 2021, Workiva had 884 customers with an annual contract value (ACV) of more than $100,000, up 32% from 670 customers at March 31, 2020. Workiva had 457 customers with an ACV of more than $150,000, up 48% from 308 customers in the first quarter of 2020.

Financial Outlook

As of May 4, 2021, Workiva is providing guidance as follows:

Second Quarter 2021 Guidance:

  • Total revenue is expected to be in the range of $101.0 million to $102.0 million.
  • GAAP loss from operations is expected to be in the range of $12.1 million to $11.1 million.
  • Non-GAAP income from operations is expected to be in the range of break-even to $1.0 million.
  • GAAP net loss per basic and diluted share is expected to be in the range of $0.30 to $0.28.
  • Non-GAAP net income per basic share is expected to be in the range of $0.00 to $0.02.
  • Net income (loss) per basic share is based on 51.2 million weighted-average shares outstanding.

Full Year 2021 Guidance:

  • Total revenue is expected to be in the range of $418.0 million to $420.0 million.
  • GAAP loss from operations is expected to be in the range of $53.7 million to $51.7 million.
  • Non-GAAP loss from operations is expected to be in the range of $5.0 million to $3.0 million.
  • GAAP net loss per basic and diluted share is expected to be in the range of $1.31 to $1.27.
  • Non-GAAP net loss per basic and diluted share is expected to be in the range of $0.19 to $0.15.
  • Net income (loss) per basic and diluted share is based on 51.4 million weighted-average shares outstanding.

Workiva has factored into its guidance the expected impacts of COVID-19 on its business and results of operations based on currently available information. Significant variation from these assumptions could cause the company to change its guidance, and it undertakes no obligation to update its assumptions, expectations or guidance. These statements are forward-looking, and actual results may differ materially, as further discussed below under the heading “Safe Harbor Statement”.

Quarterly Conference Call

Workiva will host a conference call today at 5:00 p.m. ET to review the Company’s financial results for the first quarter, in addition to discussing the Company’s outlook for the second quarter and full year 2021. To access this call, dial 833-968-1977 (U.S. domestic) or 647-689-6649 (international). The conference ID is 4446607. A live webcast of the conference call will be accessible in the “Investor Relations” section of Workiva’s website at www.workiva.com. A replay of this conference call can also be accessed through May 11, 2021, at 800-585-8367 (U.S. domestic) or 416-621-4642 (international). The replay pass code is 4446607. An archived webcast of this conference call will also be available an hour after the completion of the call in the “Investor Relations” section of the Company’s website at www.workiva.com.

About Workiva

Workiva Inc. (NYSE: WK) simplifies complex work for thousands of organizations worldwide. Customers trust Workiva’s open, intelligent and intuitive platform to connect data, documents and teams. The results: more efficiency, greater transparency and less risk. Learn more at workiva.com.

Read the Workiva blog: www.workiva.com/blog

Follow Workiva on LinkedIn: www.linkedin.com/company/workiva

Like Workiva on Facebook: www.facebook.com/workiva

Follow Workiva on Twitter: www.twitter.com/workiva

Non-GAAP Financial Measures

The non-GAAP adjustments referenced herein relate to the exclusion of stock-based compensation and non-cash interest expense. A reconciliation of GAAP to non-GAAP historical financial measures has been provided in Table I at the end of this press release. A reconciliation of GAAP to non-GAAP guidance has been provided in Table II at the end of this press release.

Workiva believes that the use of non-GAAP gross profit and gross margin, non-GAAP income (loss) from operations, non-GAAP net income (loss) and non-GAAP net income (loss) per share is helpful to its investors. These measures, which are referred to as non-GAAP financial measures, are not prepared in accordance with generally accepted accounting principles in the United States, or GAAP. Non-GAAP gross profit is calculated by excluding stock-based compensation expense attributable to cost of revenues from gross profit. Non-GAAP gross margin is the ratio calculated by dividing non-GAAP gross profit by revenues. Non-GAAP income (loss) from operations is calculated by excluding stock-based compensation expense from loss from operations. Non-GAAP net income (loss) is calculated by excluding stock-based compensation expense, net of tax, and non-cash interest expense related to our convertible senior notes from net loss. Non-GAAP net income (loss) per share is calculated by dividing non-GAAP net income (loss) by the weighted- average shares outstanding as presented in the calculation of GAAP net loss per share. Because of varying available valuation methodologies, subjective assumptions and the variety of equity instruments that can impact a company’s non-cash expenses, Workiva believes that providing non-GAAP financial measures that exclude stock-based compensation expense allows for more meaningful comparisons between its operating results from period to period. Under GAAP, certain convertible debt instruments that may be settled in cash on conversion are required to be accounted for as separate liability and equity components in a manner that reflects our non-convertible debt borrowing rate. This results in the debt component being treated as though it was issued at a discount, with the debt discount being accreted as additional non-cash interest expense over the term of the notes using the effective interest method. As a result, we believe that excluding this non-cash interest expense attributable to the debt discount in calculating our non-GAAP measures is useful because this interest expense does not represent a cash outflow and is not indicative of our ongoing operational performance. Workiva’s management uses these non-GAAP financial measures as tools for financial and operational decision making and for evaluating Workiva’s own operating results over different periods of time.

Non-GAAP financial measures may not provide information that is directly comparable to that provided by other companies in Workiva’s industry, as other companies in the industry may calculate non-GAAP financial results differently. In addition, there are limitations in using non-GAAP financial measures because the non-GAAP financial measures are not prepared in accordance with GAAP, may be different from non-GAAP financial measures used by other companies and exclude expenses that may have a material impact on Workiva’s reported financial results. Further, stock-based compensation expense has been and will continue to be for the foreseeable future a significant recurring expense in Workiva’s business and an important part of the compensation provided to its employees. The presentation of non-GAAP financial information is not meant to be considered in isolation or as a substitute for the directly comparable financial measures prepared in accordance with GAAP. Investors should review the reconciliation of non-GAAP financial measures to the comparable GAAP financial measures included below, and not rely on any single financial measure to evaluate Workiva’s business.

Safe Harbor Statement

Certain statements in this press release are “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and are subject to the safe harbor created thereby. These statements relate to future events or the Company’s future financial performance and involve known and unknown risks, uncertainties and other factors that may cause the actual results, levels of activity, performance or achievements of the Company or its industry to be materially different from those expressed or implied by any forward-looking statements. In particular, statements about the Company’s expectations, beliefs, plans, objectives, assumptions, future events or future performance contained in this press release are forward-looking statements. In some cases, forward-looking statements can be identified by terminology such as “may,” “will,” “could,” “would,” “should,” “expect,” “plan,” “anticipate,” “intend,” “believe,” “estimate,” “predict,” “potential,” “outlook,” “guidance” or the negative of those terms or other comparable terminology.

Please see the Company’s documents filed or to be filed with the Securities and Exchange Commission, including the Company’s annual reports filed on Form 10-K and quarterly reports on Form 10-Q, and any amendments thereto for a discussion of certain important risk factors that relate to forward-looking statements contained in this report. The Company has based these forward-looking statements on its current expectations, assumptions, estimates and projections. While the Company believes these expectations, assumptions, estimates and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond the Company’s control. These and other important factors may cause actual results, performance or achievements to differ materially from those expressed or implied by these forward-looking statements. Any forward-looking statements are made only as of the date hereof, and unless otherwise required by applicable securities laws, 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.

WORKIVA INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except share and per share amounts)

 

Three months ended March 31,

 

2021

 

2020

 

(unaudited)

Revenue

 

 

 

Subscription and support

$

84,936

 

 

$

68,361

 

Professional services

19,286

 

 

17,440

 

Total revenue

104,222

 

 

85,801

 

Cost of revenue

 

 

 

Subscription and support (1)

13,202

 

 

12,153

 

Professional services (1)

10,474

 

 

10,243

 

Total cost of revenue

23,676

 

 

22,396

 

Gross profit

80,546

 

 

63,405

 

Operating expenses

 

 

 

Research and development (1)

26,634

 

 

22,994

 

Sales and marketing (1)

41,035

 

 

36,117

 

General and administrative (1)

17,021

 

 

13,369

 

Total operating expenses

84,690

 

 

72,480

 

Loss from operations

(4,144)

 

 

(9,075)

 

Interest income

360

 

 

1,706

 

Interest expense

(3,485)

 

 

(3,478)

 

Other (expense) income, net

(384)

 

 

718

 

Loss before (benefit) provision for income taxes

(7,653)

 

 

(10,129)

 

(Benefit) provision for income taxes

(329)

 

 

289

 

Net loss

$

(7,324)

 

 

$

(10,418)

 

Net loss per common share:

 

 

 

Basic and diluted

$

(0.15)

 

 

$

(0.22)

 

Weighted-average common shares outstanding – basic and diluted

50,244,120

 

 

47,545,703

 

(1) Includes stock-based compensation expense as follows:

 

Three months ended March 31,

 

2021

 

2020

 

(unaudited)

Cost of revenue

 

 

 

Subscription and support

$

496

 

 

$

431

 

Professional services

367

 

 

425

 

Operating expenses

 

 

 

Research and development

2,431

 

 

1,583

 

Sales and marketing

3,549

 

 

2,736

 

General and administrative

4,780

 

 

4,761

 

 

WORKIVA INC.

CONSOLIDATED BALANCE SHEETS

(in thousands)

 

March 31, 2021

 

December 31, 2020

 

(unaudited)

 

 

Assets

 

 

 

Current assets

 

 

 

Cash and cash equivalents

$

331,173

 

 

$

322,831

 

Marketable securities

209,446

 

 

207,207

 

Accounts receivable, net

53,754

 

 

68,922

 

Deferred costs

22,924

 

 

21,923

 

Other receivables

3,314

 

 

3,155

 

Prepaid expenses and other

12,758

 

 

9,047

 

Total current assets

633,369

 

 

633,085

 

Property and equipment, net

28,961

 

 

29,365

 

Operating lease right-of-use assets

16,501

 

 

15,844

 

Deferred costs, non-current

23,422

 

 

23,421

 

Intangible assets, net

1,560

 

 

1,583

 

Other assets

4,610

 

 

3,708

 

Total assets

$

708,423

 

 

$

707,006

 

Liabilities and Stockholders’ Equity

 

 

 

Current liabilities

 

 

 

Accounts payable

$

4,716

 

 

$

2,843

 

Accrued expenses and other current liabilities

60,110

 

 

68,256

 

Deferred revenue

212,025

 

 

208,990

 

Finance lease obligations

1,728

 

 

1,705

 

Total current liabilities

278,579

 

 

281,794

 

Convertible senior notes, net

291,756

 

 

289,490

 

Deferred revenue, non-current

32,888

 

 

35,894

 

Other long-term liabilities

1,683

 

 

1,680

 

Operating lease liabilities, non-current

17,540

 

 

17,209

 

Finance lease obligations, non-current

16,221

 

 

16,662

 

Total liabilities

638,667

 

 

642,729

 

Stockholders’ equity

 

 

 

Common stock

50

 

 

49

 

Additional paid-in-capital

491,549

 

 

478,698

 

Accumulated deficit

(422,024)

 

 

(414,700)

 

Accumulated other comprehensive income

181

 

 

230

 

Total stockholders’ equity

69,756

 

 

64,277

 

Total liabilities and stockholders’ equity

$

708,423

 

 

$

707,006

 

WORKIVA INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

 

Three months ended March 31,

 

2021

 

2020

 

(unaudited)

Cash flows from operating activities

 

 

 

Net loss

$

(7,324)

 

 

$

(10,418)

 

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

 

 

 

Depreciation and amortization

1,054

 

 

1,063

 

Stock-based compensation expense

11,623

 

 

9,936

 

(Recovery of) provision for doubtful accounts

(118)

 

 

40

 

Amortization of premiums and discounts on marketable securities, net

625

 

 

101

 

Amortization of debt discount and issuance costs

2,266

 

 

2,197

 

Deferred income tax

(346)

 

 

—

 

Changes in assets and liabilities:

 

 

 

Accounts receivable

15,265

 

 

14,265

 

Deferred costs

(1,059)

 

 

603

 

Operating lease right-of-use asset

944

 

 

1,098

 

Other receivables

(161)

 

 

(253)

 

Prepaid expenses

(3,747)

 

 

(1,955)

 

Other assets

(573)

 

 

(74)

 

Accounts payable

1,908

 

 

(1,382)

 

Deferred revenue

179

 

 

(1,228)

 

Operating lease liability

(1,076)

 

 

(1,145)

 

Accrued expenses and other liabilities

(7,957)

 

 

(8,021)

 

Net cash provided by operating activities

11,503

 

 

4,827

 

Cash flows from investing activities

 

 

 

Purchase of property and equipment

(849)

 

 

(688)

 

Purchase of marketable securities

(43,655)

 

 

(20,832)

 

Sale of marketable securities

—

 

 

11,423

 

Maturities of marketable securities

40,586

 

 

12,975

 

Purchase of intangible assets

(71)

 

 

(77)

 

Net cash (used in) provided by investing activities

(3,989)

 

 

2,801

 

 

 

 

 

Cash flows from financing activities

 

 

 

Proceeds from option exercises

4,138

 

 

2,794

 

Taxes paid related to net share settlements of stock-based compensation awards

(7,146)

 

 

(1,379)

 

Proceeds from shares issued in connection with employee stock purchase plan

4,237

 

 

3,660

 

Principal payments on finance lease obligations

(417)

 

 

(398)

 

Net cash provided by financing activities

812

 

 

4,677

 

Effect of foreign exchange rates on cash

16

 

 

(613)

 

Net increase in cash and cash equivalents

8,342

 

 

11,692

 

Cash and cash equivalents at beginning of period

322,831

 

 

381,742

 

Cash and cash equivalents at end of period

$

331,173

 

 

$

393,434

 

TABLE I

WORKIVA INC.

RECONCILIATION OF NON-GAAP INFORMATION

(in thousands, except share and per share)

 

Three months ended March 31,

 

2021

 

2020

Gross profit, subscription and support

$

71,734

 

 

$

56,208

 

Add back: Stock-based compensation

496

 

 

431

 

Gross profit, subscription and support, non-GAAP

$

72,230

 

 

$

56,639

 

As a percentage of subscription and support revenue, non-GAAP

85.0

%

 

82.9

%

 

 

 

 

Gross profit, professional services

$

8,812

 

 

$

7,197

 

Add back: Stock-based compensation

367

 

 

425

 

Gross profit, professional services, non-GAAP

$

9,179

 

 

$

7,622

 

As a percentage of professional services revenue, non-GAAP

47.6

%

 

43.7

%

 

 

 

 

Gross profit

$

80,546

 

 

$

63,405

 

Add back: Stock-based compensation

863

 

 

856

 

Gross profit, non-GAAP

$

81,409

 

 

$

64,261

 

As percentage of revenue, non-GAAP

78.1

%

 

74.9

%

 

 

 

 

Cost of revenue, subscription and support

$

13,202

 

 

$

12,153

 

Less: Stock-based compensation

496

 

 

431

 

Cost of revenue, subscription and support, non-GAAP

$

12,706

 

 

$

11,722

 

As percentage of revenue, non-GAAP

12.2

%

 

13.7

%

 

 

 

 

Cost of revenue, professional services

$

10,474

 

 

$

10,243

 

Less: Stock-based compensation

367

 

 

425

 

Cost of revenue, professional services, non-GAAP

$

10,107

 

 

$

9,818

 

As percentage of revenue, non-GAAP

9.7

%

 

11.4

%

 

 

 

 

Research and development

$

26,634

 

 

$

22,994

 

Less: Stock-based compensation

2,431

 

 

1,583

 

Research and development, non-GAAP

$

24,203

 

 

$

21,411

 

As percentage of revenue, non-GAAP

23.2

%

 

25.0

%

 

 

 

 

Sales and marketing

$

41,035

 

 

$

36,117

 

Less: Stock-based compensation

3,549

 

 

2,736

 

Sales and marketing, non-GAAP

$

37,486

 

 

$

33,381

 

As percentage of revenue, non-GAAP

36.0

%

 

38.9

%

 

 

 

 

General and administrative

$

17,021

 

 

$

13,369

 

Less: Stock-based compensation

4,780

 

 

4,761

 

General and administrative, non-GAAP

$

12,241

 

 

$

8,608

 

As percentage of revenue, non-GAAP

11.7

%

 

10.0

%

 

 

 

 

Loss from operations

$

(4,144)

 

 

$

(9,075)

 

Add back: Stock-based compensation

11,623

 

 

9,936

 

Income from operations, non-GAAP

$

7,479

 

 

$

861

 

As percentage of revenue, non-GAAP

7.2

%

 

1.0

%

 

 

 

 

Net loss

$

(7,324)

 

 

$

(10,418)

 

Add back: Stock-based compensation

11,623

 

 

9,936

 

Add back: Non-cash interest expense related to convertible senior notes

2,266

 

 

2,197

 

Net income, non-GAAP

$

6,565

 

 

$

1,715

 

As percentage of revenue, non-GAAP

6.3

%

 

2.0

%

 

 

 

 

Net loss per basic and diluted share:

$

(0.15)

 

 

$

(0.22)

 

Add back: Stock-based compensation

0.23

 

 

0.21

 

Add back: Non-cash interest expense related to convertible senior notes

0.05

 

 

0.05

 

Net income per basic share, non-GAAP

$

0.13

 

 

$

0.04

 

Net income per diluted share, non-GAAP

$

0.12

 

 

$

0.03

 

 

 

 

 

Weighted-average common shares outstanding – basic, non-GAAP

50,244,120

 

 

47,545,703

 

Weighted-average common shares outstanding – diluted, non-GAAP

55,090,270

 

 

51,749,547

 

TABLE II

WORKIVA INC.

RECONCILIATION OF NON-GAAP GUIDANCE

(in thousands, except share and per share data)

 

Three months ending June 30, 2021

 

Year ending December 31, 2021

 

 

 

 

 

 

 

 

Loss from operations, GAAP range

$

(12,100)

 

–

$

(11,100)

 

 

$

(53,700)

 

–

$

(51,700)

 

Add back: Stock-based compensation

12,100

 

 

12,100

 

 

48,700

 

 

48,700

 

Income (loss) from operations, non-GAAP range

$

—

 

–

$

1,000

 

 

$

(5,000)

 

–

$

(3,000)

 

 

 

 

 

 

 

 

 

Net loss per share, GAAP range

$

(0.30)

 

–

$

(0.28)

 

 

$

(1.31)

 

–

$

(1.27)

 

Add back: Stock-based compensation

0.24

 

 

0.24

 

 

0.95

 

 

0.95

 

Add back: Non-cash interest expense related to convertible senior notes

0.04

 

 

0.04

 

 

0.17

 

 

0.17

 

Net income (loss) per share, basic, non-GAAP range

$

(0.02)

 

–

$

—

 

 

$

(0.19)

 

–

$

(0.15)

 

 

 

 

 

 

 

 

 

Weighted-average common shares outstanding – basic

51,200,000

 

 

51,200,000

 

 

51,400,000

 

 

51,400,000

 

 

Investor Contact:

Adam Terese

Workiva Inc.

[email protected]

(515) 663-4493

Media Contact:

Kevin McCarthy

Workiva Inc.

[email protected]

(515) 663-4471

KEYWORDS: United States North America Iowa

INDUSTRY KEYWORDS: Software Finance Consulting Data Management Accounting Professional Services Technology Security

MEDIA:

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ESCO Announces Second Quarter Fiscal 2021 Results

– Q2 GAAP EPS $0.62 and Adjusted EPS $0.59 (Tops Consensus Estimate) – YTD 2021 Adjusted EPS $1.15 versus $1.11 YTD 2020 (Pre-COVID) – Record YTD Cash Flow from Operations –

St. Louis, May 04, 2021 (GLOBE NEWSWIRE) — ESCO Technologies Inc. (NYSE: ESE) (ESCO, or the Company) today reported its operating results for the second quarter and six months ended March 31, 2021 (Q2 2021 and YTD 2021) compared to the second quarter and six months ended March 31, 2020 (Q2 2020 and YTD 2020).

Vic Richey, Chairman and Chief Executive Officer, commented, “We continue to successfully manage through the COVID-19 global pandemic and our primary focus remains the health and safety of our employees, customers and suppliers. I’m proud of our entire team for how they’ve responded to the challenges over the past year, and I’m confident that we are positioning ourselves to be a stronger, more profitable company as we emerge from the pandemic and our end-markets fully recover.

“Our second quarter and year-to-date operating results reflect the importance of maintaining diversity across our end-markets, as this diversity, coupled with our substantial liquidity will continue to support our long-term growth. Our multi-segment platform enabled us to substantially mitigate the pandemic’s impact on our operating results, and our disciplined approach around working capital management allowed us to generate record cash flow in 2021.

“Given the strength of the first half of 2020 pre-COVID, we previously communicated that we expected the first half of 2021 to be slightly lower, comparatively. Through March 31st, we are ahead of our original profit expectations as our continued focus on operating execution and effective cost management drove our first-half Adjusted EPS to $1.15 per share, an increase of 4 percent over the Adjusted EPS of $1.11 per share reported in the first half of 2020. This was accomplished despite a 6 percent decrease in sales primarily due to COVID’s impact.

“Regarding our upcoming executive management team retirements announced previously, I’m pleased to welcome Chris Tucker to our executive leadership team as Senior Vice President and Chief Financial Officer replacing Gary Muenster, who’s retiring after 31 years at ESCO, with the past 18 years serving as Executive Vice President and Chief Financial Officer. Chris possesses a strong financial skill-set and a keen understanding of strategy, capital allocation, ROIC, and shareholder value creation developed during his 24 year career at Emerson.

“Additionally, Dave Schatz, who has been with ESCO for the past 23 years, has been promoted to Senior Vice President, General Counsel & Secretary replacing Alyson Barclay who is retiring after 33 years with the Company, most recently serving as Senior Vice President and with the past 21 years as General Counsel & Secretary. I look forward to working with Chris and Dave in their new roles, and I’d like to thank Gary and Alyson for their substantial contributions to ESCO’s success over their long careers.”

Discrete Items

During Q2 2021, the Company recorded a $1.9 million pretax gain from the contingent cash settlement of the fiscal 2019 sale of the former Doble headquarters property in Watertown, Massachusetts, partially offset by $0.7 million of facility shut-down costs related to the closure of a former USG manufacturing facility in Toronto (described in the November 2020 earnings release). The combined impact resulted in a net after-tax gain of $0.03 per share which is excluded from the calculation of Adjusted EBITDA and Adjusted EPS in Q2 2021.

There were no Discrete Items identified in Q2 2020 impacting GAAP EPS or Adjusted EPS.

During Q1 2020, the company completed the sale of its Technical Packaging segment which resulted in gross cash proceeds of $191 million and a net gain on the sale of $77 million, or $2.93 per share, which is recorded as discontinued operations. The impact of discontinued operations is excluded from the calculation of Adjusted EBITDA and Adjusted EPS in 2020.

The financial results presented include certain non-GAAP financial measures such as EBIT, EBITDA, Adjusted EBITDA and Adjusted EPS, as defined within the “Non-GAAP Financial Measures” described below. Any non-GAAP financial measures presented are reconciled to their respective GAAP equivalents.

Management believes these non-GAAP financial measures are useful in assessing the ongoing operational profitability of the Company’s business segments, and therefore, allow shareholders better visibility into the Company’s underlying operations. See “Non-GAAP Financial Measures” described below.

Earnings Summary

Q2 2021 GAAP EPS was $0.62 per share (GAAP net earnings of $16.3 million) and included the net earnings’ impact of the Q2 2021 Discrete Items described above. Excluding the net earnings impact of the Discrete Items, Q2 2021 Adjusted EPS was $0.59 per share.

Q2 2020 GAAP EPS and Adjusted EPS was $0.68 per share (GAAP net earnings of $17.8 million).

Adjusted EBITDA was $31 million in Q2 2021 and Q2 2020, and YTD Adjusted EBITDA increased to $60 million, from $59 million YTD 2020.

Operating Highlights – Q2

  • Net sales were $167 million in Q2 2021, compared to $180 million in Q2 2020, pre-COVID.
  • A&D segment sales decreased $12 million in Q2 2021, resulting from lower commercial aerospace sales due to COVID, partially offset by a $4 million increase in Navy sales.
  • Driven by an increase in chamber project deliveries internationally, Test sales increased to $44 million in Q2 2021 from $42 million in Q2 2020.
  • USG sales were $40 million in Q2 2021 compared to $44 million in Q2 2020 as a result of COVID restrictions impacting on-site personnel at substations, large transformers and other customer locations. Q2 2021 sales were also impacted by the higher volume of sales reported in Q1 2021 as several utility customers accelerated calendar year-end spending for equipment and software requirements. The quarterly timing of YTD 2021 sales resulted in a modest decrease in sales from YTD 2020, pre-COVID.
  • Consolidated gross margin percentage increased to 38.1 percent in Q2 2021 from 37.3 percent in Q2 2020 driven by a favorable sales mix coupled with manufacturing cost reduction actions previously implemented across the company.
  • SG&A expenses decreased $1.2 million in Q2 2021 compared to Q2 2020 as a result of lower spending (lower headcount, less travel, no pension costs) which helped to offset the reduced sales due to COVID.
  • Interest expense decreased $0.9 million in Q2 2021 compared to Q2 2020 due to lower debt outstanding.
  • The effective income tax rate increased to 23.5 percent in Q2 2021 from 11 percent in Q2 2020. The significantly lower tax rate in Q2 2020 reflected the favorable impact of certain one-time tax strategies implemented in the prior year which were not repeated.
  • Entered orders were $176 million in Q2 2021 (book-to-bill of 1.06x) with all three operating segments reporting backlog growth, resulting in ending backlog of $522 million at March 31, 2021.
  • YTD 2021 net cash provided by operating activities was $57 million, resulting in a net cash position (total cash on hand, less total borrowings) of $24 million at March 31, 2021 reflecting a 0.23x leverage ratio.


Chairman’s Commentary

Vic Richey, Chairman and Chief Executive Officer, commented, “While still being impacted by COVID within our commercial aerospace and utility businesses, I’m really pleased with our Q2 and YTD results as we continue to see numerous highlights across the company which offset the obvious headwinds.

“Driven by our increased focus on working capital management and cash conversion, a clear highlight for the first half of the year is the strength of our cash generation which continued to increase our liquidity. Our strong balance sheet has us positioned favorably as we move forward on current acquisition opportunities and continue to expand our internal investments in new product development across the company.

“From an operations perspective, A&D clearly led our Q2 2021 success by substantially exceeding our internal expectations on both sales and earnings, as the segment reported an Adjusted EBIT margin of nearly 22 percent in the Quarter. A&D’s margin contribution was impressive given the noted decrease in commercial aerospace sales, which have historically been a meaningful profit contributor to the segment. This solid margin was achieved as a result of our actions to reduce costs and resize the business during 2020 in response to the downturn in commercial air travel.

“Delivering a solid operating margin in A&D during COVID reflects the strength of our program, product and end-market diversity, as the Navy and defense markets remained resilient. A&D’s longer-term operating margins are expected to improve as the commercial aerospace market recovers over time, while further benefitting from our lower operating cost structure. The defense portion of A&D, both military aerospace and Navy products, is expected to remain strong for the foreseeable future given its sizeable backlog coupled with the timing of expected platform deliveries.

“We continue to see tangible signs of recovery in commercial aerospace as passenger boardings continue to increase and we’ve noted that more airlines are adding idled aircraft back into the fleet. We believe as COVID vaccinations become more widespread, the hesitance within the traveling public will diminish and this will accelerate pent-up travel demand.

“The performance of the Test segment continues to be solid as we increased our Q2 2021 sales by over 5 percent and delivered an EBIT margin of 13 percent. While not immune from COVID’s impact, our Test business continues to demonstrate its resilience by delivering consistently solid operating results, and we expect Test’s outlook to remain positive given the strength of its served markets, primarily related to new communications technologies such as 5G, and our growing shielding business. Our view of 5G’s future is favorable given the size of the investments being made by numerous large, global companies leading its development.

“While USG’s Q2 2021 sales were softer than originally projected, primarily due to the timing within the respective quarters in the first half of 2021, I’m pleased with their performance year-to-date both from a sales and Adjusted EBIT perspective. Doble was most impacted by the sales timing profile in Q2 2021, while NRG’s renewable energy business significantly exceeded our internal expectations and prior year.

“USG’s YTD 2021 sales were down modestly from prior year due to COVID’s impact on the utility industry world-wide, but I’m pleased to see the YTD 2021 Adjusted EBIT margin of 20 percent, up from 15 percent YTD 2020. A favorable sales mix in addition to our cost reduction actions implemented last year are having a positive impact on our operating margins, and we expect that trend to continue.

“We expect to see some continued deferrals of test equipment purchases and maintenance-related projects for the next few months, but our positive outlook for the second half of the year remains unchanged.

“I’m encouraged by the enthusiasm being generated in the market surrounding several new products and solutions recently introduced at Doble, and we continue to see NRG’s end markets gaining momentum as investments in renewable energy have been increasing in both wind and solar. Sales of our recently upgraded solar products have been growing far better than anticipated and we expect that growth to continue.

“Wrapping up, I’m pleased that we continue to generate substantial cash from operations and were able to increase our Q2 2021 Adjusted EBITDA margin to 19 percent, up from 17 percent in Q2 2020, despite the lower contribution from our commercial aerospace business and the timing of USG’s quarterly sales.

“Given our strong financial condition, we expect to fund future acquisitions while organically growing our business through continued investment in new products and solutions. We are evaluating a solid pipeline of M&A opportunities and we are confident that we will add to our current portfolio. We are clearly focused on targets that will increase shareholder value by adding complementary businesses that deliver meaningful returns.

“We have positioned ourselves favorably from a cost structure standpoint and we anticipate a gradual return to a more normal operating environment in the second half of 2021. I continue to have a strong, favorable view of our future.”

Dividend Payment

The next quarterly cash dividend of $0.08 per share will be paid on July 16, 2021 to stockholders of record on July 1, 2021.

Business Outlook –2021 (COVIDUncertainty)

Our current Business Outlook for the remainder of 2021 is consistent with the commentary included in the Company’s previous earnings releases and is summarized below.

In mid-year 2020, business disruptions related to the pandemic began to affect the Company’s operations and continued throughout the balance of the year. During 2021, the commercial aerospace and utility end-markets have seen some degree of customer stabilization, as well as notable pockets of recovery; however, there is still uncertainty as to the timing and pace of the recovery in these areas.

The wide distribution of viable COVID-19 vaccines is anticipated to benefit and accelerate the recovery of commercial air travel and utility spending with customers resuming normal testing protocols and equipment purchases, but Management has determined that it is advisable to wait before resuming specific guidance.

Given this uncertainty, it is difficult to predict how the balance of 2021 will be affected using normal forecasting methodologies, therefore, the Company will continue its suspension of forward-looking guidance.

To assist shareholders and analysts, Management will continue offering “directional” guidance for the balance of 2021, by stating that the Company continues to see tangible signs of recovery that point to a solid outlook for the back half of the year, and the second half of 2021 is expected to compare favorably to the second half of 2020 given the anticipated elements of recovery.

Management’s current expectations for 2021 show growth in Sales, Adjusted EBITDA, Adjusted EPS, and cash flow from operating activities compared to 2020, with Adjusted EBITDA reasonably consistent with 2019, pre-COVID.

Conference Call

The Company will host a conference call today, May 4, at 4:00 p.m. Central Time, to discuss the Company’s Q2 2021 results. A live audio webcast will be available on the Company’s website at www.escotechnologies.com. Please access the website at least 15 minutes prior to the call to register, download and install any necessary audio software. A replay of the conference call will be available on the Company’s website noted above or by phone (dial 1-855-859-2056 and enter the pass code 9334419).

Forward-Looking Statements

Statements in this press release regarding the timing and magnitude of recovery in the Company’s end markets resulting from the availability of viable COVID-19 vaccines, the continuing impacts of COVID-19 on the Company’s results, Sales, Adjusted EBITDA, Adjusted EPS, cash flow, results of cost reduction efforts, margins, growth, the financial success of the Company, the strength of its end markets, the outlook for the A&D, Test and USG segments, the ability to increase shareholder value, the timing and success of acquisition efforts, internal investments in new products and solutions, the long-term success of the Company, and any other statements which are not strictly historical are “forward-looking” statements within the meaning of the safe harbor provisions of the federal securities laws.

Investors are cautioned that such statements are only predictions and speak only as of the date of this release, and the Company undertakes no duty to update them except as may be required by applicable laws or regulations. The Company’s actual results in the future may differ materially from those projected in the forward-looking statements due to risks and uncertainties that exist in the Company’s operations and business environment including but not limited to those described in Item 1A, “Risk Factors”, of the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2020; the availability and acceptance of viable COVID-19 vaccines by enough of the U.S. and world’s population to curtail the pandemic; the continuing impact of the COVID-19 pandemic including labor shortages, facility closures, shelter in place policies or quarantines, material shortages, transportation delays, termination or delays of Company contracts, and the inability of our suppliers or customers to perform; the impacts of natural disasters on the Company’s operations and those of the Company’s customers and suppliers; the timing and content of future contract awards or customer orders; the appropriation, allocation and availability of Government funds; the termination for convenience of Government and other customer contracts or orders; weakening of economic conditions in served markets; the success of the Company’s competitors; changes in customer demands or customer insolvencies; competition; intellectual property rights; technical difficulties; the success of the Company’s acquisition efforts; delivery delays or defaults by customers; performance issues with key customers, suppliers and subcontractors; material changes in the costs and availability of certain raw materials; labor disputes; changes in U.S. tax laws and regulations; other changes in laws and regulations including but not limited to changes in accounting standards and foreign taxation; changes in interest rates; costs relating to environmental matters arising from current or former facilities; uncertainty regarding the ultimate resolution of current disputes, claims, litigation or arbitration; and the integration of recently acquired businesses.

Non-GAAP Financial Measures

The financial measures EBIT, EBITDA, Adjusted EBITDA and Adjusted EPS are presented in this press release. The Company defines “EBIT” as earnings before interest and taxes, “EBITDA” as earnings before interest, taxes, depreciation and amortization, “Adjusted EBITDA” as EBITDA excluding certain defined charges, and “Adjusted EPS” as GAAP earnings per share (EPS) excluding the net impact of the items described above which were ($0.03) per share in Q2 2021.

EBIT, EBITDA, Adjusted EBITDA and Adjusted EPS are not recognized in accordance with U.S. generally accepted accounting principles (GAAP). However, Management believes that EBIT, EBITDA and Adjusted EBITDA are useful in assessing the operational profitability of the Company’s business segments because they exclude interest, taxes, depreciation and amortization, which are generally accounted for across the entire Company on a consolidated basis. EBIT is also one of the measures used by Management in determining resource allocations within the Company as well as incentive compensation. The presentation of EBIT, EBITDA, Adjusted EBITDA and Adjusted EPS provides important supplemental information to investors by facilitating comparisons with other companies, many of which use similar non-GAAP financial measures to supplement their GAAP results. The use of non-GAAP financial measures is not intended to replace any measures of performance determined in accordance with GAAP.

ESCO, headquartered in St. Louis, Missouri: Manufactures highly-engineered filtration and fluid control products for the aviation, Navy, space and process markets worldwide, as well as composite-based products and solutions for Navy, defense and industrial customers; is the industry leader in RF shielding and EMC test products; and provides diagnostic instruments, software and services for the benefit of industrial power users and the electric utility and renewable energy industries. Further information regarding ESCO and its subsidiaries is available on the Company’s website at www.escotechnologies.com.
   
   

ESCO TECHNOLOGIES INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations (Unaudited)
(Dollars in thousands, except per share amounts)
  
          Three Months
Ended
March 31, 2021		   Three Months
Ended
March 31, 2020
               
Net Sales $ 166,644     180,492
Cost and Expenses:        
  Cost of sales   103,113     113,242
  Selling, general and administrative expenses   38,746     39,982
  Amortization of intangible assets   4,917     5,220
  Interest expense   432     1,320
  Other (income) expenses, net   (1,903 )   703
    Total costs and expenses   145,305     160,467
               
Earnings before income taxes   21,339     20,025
Income tax expense   5,025     2,203
               
    Net earnings $ 16,314     17,822
               
    Diluted EPS:        
    Diluted – GAAP        
      Net earnings $ 0.62     0.68
               
    Diluted – As Adjusted Basis        
      Continuing operations $ 0.59   (1 ) 0.68
               
    Diluted average common shares O/S:   26,201     26,088
               
(1 ) Q2 2021 Adjusted EPS excludes $0.03 per share of after-tax income associated with the final settlement from the sale of the Doble Watertown facility partially offset by charges related to the Doble Manta facility consolidation.

   

   

ESCO TECHNOLOGIES INC. AND SUBSIDIARIES  
Condensed Consolidated Statements of Operations (Unaudited)  
(Dollars in thousands, except per share amounts)  
    
          Six Months
Ended
March 31,
2021		   Six Months
Ended
March 31,
2020		  
                 
Net Sales   $ 329,593     352,220    
Cost and Expenses:          
  Cost of sales   201,890     219,969    
  Selling, general and administrative expenses   79,746     82,087    
  Amortization of intangible assets   9,865     11,030    
  Interest expense   973     3,741    
  Other (income) expenses, net   (1,880 )   998    
    Total costs and expenses   290,594     317,825    
                 
Earnings before income taxes   38,999     34,395    
Income tax expense   8,999     5,809    
                 
    Earnings from continuing operations   30,000     28,586    
                 
(Loss) earnings from discontinued operations, net of tax      
  expense of $269   –     (601 )  
Gain on sale of discontinued operations, net of          
  tax expense of $23,734   –     76,614    
                 
    Earnings from discontinued operations   –     76,013    
                 
    Net earnings $ 30,000     104,599    
                 
    Diluted EPS:          
    Diluted – GAAP          
      Continuing operations $ 1.15     1.09    
      Discontinued operations   0.00     2.91    
      Net earnings $ 1.15     4.00    
                 
    Diluted – As Adjusted Basis          
      Continuing operations $ 1.15   (1 ) 1.11   (2 )
                 
    Diluted average common shares O/S:   26,192     26,126    
                 
(1 ) YTD Q2 2021 Adjusted EPS excludes after-tax income associated with the final settlement from the sale of the Doble Watertown facility which was offset by charges related to the Doble Manta facility consolidation and ATM acquisition inventory step-up.
                 
(2 ) YTD Q2 2020 Adjusted EPS excludes $0.02 per share of after-tax charges primarily related to the move of the Doble headquarters facility.

   

   

ESCO TECHNOLOGIES INC. AND SUBSIDIARIES
Condensed Business Segment Information (Unaudited)
(Dollars in thousands)
   
        GAAP   As Adjusted  
        Q2 2021   Q2 2020   Q2 2021   Q2 2020  
Net Sales                  
  Aerospace & Defense $ 83,278     95,124     83,278     95,124    
  USG   39,555     43,768     39,555     43,768    
  Test   43,811     41,600     43,811     41,600    
    Totals $ 166,644     180,492     166,644     180,492    
                       
EBIT                  
  Aerospace & Defense $ 18,196     21,736     18,236     21,736    
  USG   6,725     4,866     5,461     4,866    
  Test   5,688     5,651     5,688     5,651    
  Corporate   (8,838 )   (10,908 )   (8,548 )   (10,908 )  
    Consolidated EBIT   21,771     21,345     20,837     21,345    
    Less: Interest expense   (432 )   (1,320 )   (432 )   (1,320 )  
    Less: Income tax expense   (5,025 )   (2,203 )   (4,810 )   (2,203 )  
    Net earnings from cont ops $ 16,314     17,822     15,595     17,822    
                          
Note 1: Adjusted net earnings of $15.6 million in Q2 2021 excludes $0.03 per share of after-tax income associated with the final settlement from the sale of the Doble Watertown facility partially offset by charges related to the Doble Manta facility consolidation.
                       
EBITDA Reconciliation to Net earnings from continuing operations:      
                Adjusted   Adjusted  
        Q2 2021   Q2 2020   Q2 2021   Q2 2020  
Consolidated EBITDA $ 31,874     31,388     30,940     31,388    
Less: Depr & Amort   (10,103 )   (10,043 )   (10,103 )   (10,043 )  
Consolidated EBIT   21,771     21,345     20,837     21,345    
Less: Interest expense   (432 )   (1,320 )   (432 )   (1,320 )  
Less: Income tax expense   (5,025 )   (2,203 )   (4,810 )   (2,203 )  
Net earnings from cont ops $ 16,314     17,822     15,595     17,822    
                       

   

   

   ESCO TECHNOLOGIES INC. AND SUBSIDIARIES
Condensed Business Segment Information (Unaudited)
(Dollars in thousands)
   
        GAAP   As Adjusted  
        YTD Q2 2021   YTD Q2 2020   YTD Q2 2021   YTD Q2 2020  
Net Sales                  
  Aerospace & Defense $ 150,169     172,635     150,169     172,635    
  USG   94,095     96,602     94,095     96,602    
  Test   85,329     82,983     85,329     82,983    
    Totals $ 329,593     352,220     329,593     352,220    
                       
EBIT                  
  Aerospace & Defense $ 27,576     34,249     27,936     34,319    
  USG   19,456     14,153     18,842     14,773    
  Test   11,030     10,307     11,030     10,307    
  Corporate   (18,090 )   (20,573 )   (17,740 )   (20,573 )  
    Consolidated EBIT   39,972     38,136     40,068     38,826    
    Less: Interest expense   (973 )   (3,741 )   (973 )   (3,741 )  
    Less: Income tax   (8,999 )   (5,809 )   (9,021 )   (5,975 )  
    Net earnings from cont ops $ 30,000     28,586     30,074     29,110    
                          
Note 1: Adjusted net earnings of $30.1 million in YTD Q2 2021 excludes income from the final settlement on the sale of the Doble Watertown facility offset by charges related to the Doble Manta facility consolidation and ATM acquisition inventory step-up.
                       
Note 2: Adjusted net earnings of $29.1 million in YTD Q2 2020 excludes $0.02 per share of after-tax charges related primarily to the facility move at Doble.
                       
EBITDA Reconciliation to Net earnings from continuing operations:      
                Adjusted   Adjusted  
        YTD Q2   YTD Q2   YTD Q2   YTD Q2  
              2021           2020           2021           2020    
Consolidated EBITDA $ 60,087     58,719     60,183     59,409    
Less: Depr & Amort   (20,115 )   (20,583 )   (20,115 )   (20,583 )  
Consolidated EBIT   39,972     38,136     40,068     38,826    
Less: Interest expense   (973 )   (3,741 )   (973 )   (3,741 )  
Less: Income tax expense   (8,999 )   (5,809 )   (9,021 )   (5,975 )  
Net earnings from cont ops $ 30,000     28,586     30,074     29,110    
                       

   

ESCO TECHNOLOGIES INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets (Unaudited)
(Dollars in thousands)
   
        March 31,
2021		   September 30,
2020
             
Assets        
  Cash and cash equivalents $ 45,653   52,560
  Accounts receivable, net   124,580   144,082
  Contract assets   95,002   96,746
  Inventories   145,342   136,189
  Other current assets   17,523   17,053
    Total current assets   428,100   446,630
  Property, plant and equipment, net   143,401   139,870
  Intangible assets, net   345,261   346,632
  Goodwill   411,661   408,063
  Operating lease assets   18,929   21,390
  Other assets   10,050   10,938
      $ 1,357,402   1,373,523
             
Liabilities and Shareholders’ Equity        
  Current maturities of long-term debt & short-term borrowings $ 20,000   22,368
  Accounts payable   47,091   50,525
  Contract liabilities   106,622   100,551
  Other current liabilities   72,870   82,585
    Total current liabilities   246,583   256,029
  Deferred tax liabilities   59,949   60,938
  Non-current operating lease liabilities   14,501   16,785
  Other liabilities   39,362   38,176
  Long-term debt   2,000   40,000
  Shareholders’ equity   995,007   961,595
      $ 1,357,402   1,373,523

   

   

ESCO TECHNOLOGIES INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows (Unaudited)
(Dollars in thousands)
   
    Six Months Ended
March 31, 2021
Cash flows from operating activities:    
Net earnings $ 30,000  
Adjustments to reconcile net earnings to net cash    
provided by operating activities:    
Depreciation and amortization   20,115  
Stock compensation expense   2,745  
Changes in assets and liabilities   7,401  
Gain on sale of building and land   (1,950 )
Effect of deferred taxes   (989 )
Net cash provided by operating activities   57,322  
     
Cash flows from investing activities:    
Acquisition of business, net of cash acquired   (6,684 )
Proceeds from sale of building and land   1,950  
Capital expenditures   (13,153 )
Additions to capitalized software   (3,973 )
Net cash used by investing activities   (21,860 )
     
Cash flows from financing activities:    
Proceeds from long-term debt   34,000  
Principal payments on long-term debt and short-term borrowings   (74,368 )
Dividends paid   (4,167 )
Net cash used by financing activities   (44,535 )
     
Effect of exchange rate changes on cash and cash equivalents   2,166  
     
Net decrease in cash and cash equivalents   (6,907 )
Cash and cash equivalents, beginning of period   52,560  
Cash and cash equivalents, end of period $ 45,653  

   

   

ESCO TECHNOLOGIES INC. AND SUBSIDIARIES
Other Selected Financial Data (Unaudited)
(Dollars in thousands)
   
Backlog And Entered Orders – Q2 2021   Aerospace & Defense   Test   USG   Total
  Beginning Backlog – 1/1/21 $ 343,212     124,010     44,859     512,081  
  Entered Orders   88,206     44,403     43,639     176,248  
  Sales     (83,278 )   (43,811 )   (39,555 )   (166,644 )
  Ending Backlog – 3/31/21 $ 348,140     124,602     48,943     521,685  
                     
Backlog And Entered Orders – YTD Q2 2021   Aerospace & Defense   Test   USG   Total
  Beginning Backlog – 10/1/20 $ 344,661     122,032     50,688     517,381  
  Entered Orders   153,648     87,899     92,350     333,897  
  Sales     (150,169 )   (85,329 )   (94,095 )   (329,593 )
  Ending Backlog – 3/31/21 $ 348,140     124,602     48,943     521,685  

ESCO TECHNOLOGIES INC. AND SUBSIDIARIES
Reconciliation of Non-GAAP Financial Measures (Unaudited)
   
       
EPS – Adjusted Basis Reconciliation – Q2 2021    
  EPS – GAAP Basis – Q2 2021 $ 0.62  
  Adjustments (defined below)   (0.03 )
  EPS – As Adjusted Basis – Q2 2021 $ 0.59  
       
  Adjustments exclude $0.03 per share consisting of income associated with the final
  settlement from the sale of the Doble Watertown facility partially offset by charges
  related to the Doble Manta facility consolidation in the second quarter of 2021.
  (The $0.03 of EPS adjustments per share consists of $934K of pre-tax income
  offset by $215K of tax expense for net impact of $719K.)    
       
EPS – Adjusted Basis Reconciliation – YTD Q2 2020    
  EPS from Continuing Ops – GAAP Basis – YTD Q2 2020 $ 1.09  
  Adjustments (defined below)   0.02  
  EPS from Continuing Ops – As Adjusted Basis – YTD Q2 2020 $ 1.11  
       
  Adjustments exclude $0.02 per share consisting of move costs associated with the
  Doble facility consolidation in the first six months of 2020.    
  (The $0.02 of EPS adjustments per share consists of $690K of pre-tax charges
  offset by $166K of tax benefit for net impact of $524K.)    

   

SOURCE ESCO Technologies Inc.
Kate Lowrey, Director of Investor Relations, (314) 213-7277
   
   
   



Posted on

Lordstown Motors Announces Timing of First Quarter 2021 Financial Results and Webcast

LORDSTOWN, Ohio, May 04, 2021 (GLOBE NEWSWIRE) — Lordstown Motors Corp. (Nasdaq: RIDE), (“Lordstown Motors”), a leader in electric light duty trucks focused on the commercial fleet market, today announced that it will release its first quarter 2021 financial results before market open on May 17, 2021. The company will then host a conference call at 10:00 a.m. Eastern Time.

The call can be accessed via a live webcast accessible on the Events page of Lordstown Motors’ Investor Relations website at https://investor.lordstownmotors.com/. An archive of the webcast will be available shortly after the call.

About Lordstown Motors Corp.

Lordstown Motors Corp. is an Ohio-based original equipment manufacturer of light duty fleet vehicles, founded by CEO Steve Burns with the purpose of transforming Ohio’s Mahoning Valley and Lordstown, Ohio, into the epicenter of electric-vehicle manufacturing. The company owns the 785 acre, 6.2 million square foot Lordstown Assembly Plant where it plans to build the Lordstown Endurance, believed to be the world’s first full-size, all-electric pickup truck designed to serve the commercial fleet market. For additional information visit www.lordstownmotors.com.

Forward Looking Statements

This press release includes forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements may be identified by words such as “feel,” “believes,” expects,” “estimates,” “projects,” “intends,” “should,” “is to be,” or the negative of such terms, or other comparable terminology. Forward-looking statements are statements that are not historical facts. Such forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties, which could cause actual results to differ materially from the forward-looking statements contained herein due to many factors, including, but not limited to: our limited operating history and our significant projected funding needs; risks associated with the conversion and retooling of our facility and ramp up of production; our inability to obtain binding purchase orders from customers and potential customers’ inability to integrate our electric vehicles into their existing fleets; our inability to retain key personnel and to hire additional personnel; competition in the electric pickup truck market; our inability to develop a sales distribution network; and the ability to protect our intellectual property rights. Any forward-looking statements speak only as of the date on which they are made, and Lordstown Motors Corp. undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date of this press release.

Contacts:

Investors
Carter Driscoll
[email protected]  

Media
Ryan Hallett
[email protected]  



Posted on

Uniti Group Inc. Declares $0.15 Per Share Quarterly Dividend

LITTLE ROCK, Ark., May 04, 2021 (GLOBE NEWSWIRE) — Uniti Group Inc. (“Uniti”) (Nasdaq: UNIT) announced today that its Board of Directors declared a quarterly cash dividend of $0.15 per share, payable on July 2, 2021 to stockholders of record on June 18, 2021.

ABOUT UNITI

Uniti, an internally managed real estate investment trust, is engaged in the acquisition and construction of mission critical communications infrastructure, and is a leading provider of wireless infrastructure solutions for the communications industry. As of December 31, 2020, Uniti owns over 123,000 fiber route miles, approximately 6.9 million fiber strand miles, and other communications real estate throughout the United States. Additional information about Uniti can be found on its website at www.uniti.com.

INVESTOR AND MEDIA CONTACTS:

Mark A. Wallace, 501-850-0866
Executive Vice President, Chief Financial Officer & Treasurer
[email protected]

Bill DiTullio, 501-850-0872
Vice President, Finance and Investor Relations
[email protected]