Market Newsdesk

May 5, 2021 7:04 am

EyePoint Pharmaceuticals Reports First Quarter 2021 Financial Results and Highlights Recent Corporate Developments

– EYP-1901 DAVIO study for the potential treatment of wet AMD dosed first patient in January; study remains on track for initial data in Q4 2021;

-Completed $115.1 million follow-on financing in February 2021;

-Net product revenues of $6.8 million versus $4.7 million in Q1 2020, a 45% increase;

-Asia partner Ocumension Therapeutics new drug application (NDA) accepted for review by the National Medical Products Administration (NMPA) for OT-401 (YUTIQ)

– Management to host a conference call and webcast today at 8:30 AM ET –

WATERTOWN, Mass., May 05, 2021 (GLOBE NEWSWIRE) — EyePoint Pharmaceuticals, Inc. (NASDAQ: EYPT), a pharmaceutical company committed to developing and commercializing therapeutics to help improve the lives of patients with serious eye disorders, today announced financial results for the first quarter ended March 31, 2021 and highlighted recent corporate developments.

“This quarter was a productive one for EyePoint, as we continued to execute on our plan to advance our exciting pipeline of ocular products that have the potential to disrupt current treatment paradigms,” said Nancy Lurker, Chief Executive Officer of EyePoint Pharmaceuticals. “We are very pleased to have initiated the Phase 1 DAVIO clinical trial in patients with wet-age macular degeneration (wet AMD) in January and this trial remains on track for interim data in the fourth quarter of this year.” Ms. Lurker continued, “We were also very pleased to complete a $115.1 million follow-on financing during the first quarter positioning us to advance and expand our pipeline efficiently and purposefully, including plans to expand EYP-1901 into clinical trials in diabetic retinopathy (DR) and retinal vein occlusion (RVO). “On the commercial front, we had a solid first quarter, which historically is weak due to co-pay and coinsurance annual resets, beating 4Q2020 and 45% above 1Q2020 net product revenues. We also are very pleased with our DEXYCU® co-promotion partnership with ImprimisRx and the product demand it is now generating.”

Corporate Update

In February 2021, the Company completed an upsized underwritten public offering with gross proceeds of $115.1 million.
In April 2021, Asia partner Ocumension Therapeutics announced that the new drug application (NDA) for OT-401 (YUTIQ) has been accepted by the National Medical Products Administration of the People’s Republic of China (NMPA). OT-401 (YUTIQ) is the first ophthalmic drug of the Company whose NDA has been accepted by the NMPA, and is also the first sustained-release micro-insert submitted for NDA in mainland China that has a controlled release rate for up to 36 months. It is also the first time the NMPA has accepted the NDA based on real world study data.

Commercial Performance in First Quarter 2021

Net product revenue for YUTIQ and DEXYCU was $3.0 million and $3.8 million, respectively.
Customer demand of approximately 400 units of YUTIQ and approximately 7,000 units for DEXYCU.
DEXYCU commercial partner, ImprimisRx®, continues to provide momentum and revenue generation through their experienced cataract surgery field force, materially contributing to Q1 customer demand.

R&D Highlights

In January, the first patient was dosed in the Phase 1 DAVIO study of EYP-1901 as a potential twice-yearly sustained delivery anti-VEGF treatment for wet AMD and the Company expects to report initial data in the fourth quarter of 2021. EYP-1901 leverages a bioerodible formulation of the Company’s proprietary Durasert® drug delivery technology platform that has been used in four FDA-approved products, including EyePoint’s YUTIQ for chronic non-infectious uveitis affecting the posterior segment of the eye.
Investigator studies of DEXYCU will be presented in two separate poster sessions at the Association for Research in Vision and Ophthalmology (ARVO) Annual meeting on May 5, 2021.

Review of Results for the First Quarter ended March 31, 2021

For the first quarter ended March 31, 2021, total net revenue was $7.3 million compared to $7.5 million for the quarter ended March 31, 2020. Net product revenue for the first quarter was $6.8 million, compared to net product revenues for the first quarter ended March 31, 2020 of $4.7 million.

Net revenue from royalties and collaborations for the first quarter ended March 31, 2021 totaled $0.5 million compared to $2.8 million in the corresponding period in 2020.

Operating expenses for the first quarter ended March 31, 2021 totaled $18.3 million versus $18.9 million in the prior year period. This decrease was primarily due to a $2.4 million decrease in sales and marketing expense offset by a $0.8 million increase in G&A expense, a $0.6 million increase in R&D expense and a $0.4 million increase in cost of sales. Non-operating expense, net, totaled $1.3 million and net loss was $12.3 million, or ($0.50) per share, compared to a net loss of $13.2 million, or ($1.14) per share, for the prior year period.

Cash and cash equivalents at March 31, 2021 totaled $138.6 million compared to $44.9 million at December 31, 2020.

Financial Outlook

We expect the cash on hand at March 31, 2021 and expected net cash inflows from our product sales will enable us to fund our current and planned operations through the end of 2022.

Conference Call Information

EyePoint will host a conference call today, at 8:30 AM ET to discuss the results for the first quarter of 2021 ended March 31, 2021 and recent operational developments. To access the conference call, please dial (877-303-5828) from the U.S. and Canada or (631)-813-4828 (international) at least 10 minutes prior to the start time and refer to conference ID 1261618. A live webcast will be available on the Investor Relations section of the corporate website at http://www.eyepointpharma.com. A replay of the webcast will also be available on the corporate website.

About EYP-1901

EYP-1901 is a potential twice-yearly sustained delivery intravitreal anti-VEGF treatment for wet age-related macular degeneration. EYP-1901 leverages a bioerodible formulation of EyePoint’s proprietary Durasert® sustained release technology with vorolanib, a tyrosine kinase inhibitor. Vorolanib provided clear efficacy signals in two prior human trials in wet AMD as an orally delivered therapy with no significant ocular adverse events. EYP-1901 is currently in a Phase 1 clinical trial initially targeting treatment of wet AMD, with the potential for additional indications in diabetic retinopathy and retinal vein occlusion.

About EyePoint Pharmaceuticals, Inc. (Nasdaq:EYPT) is a pharmaceutical company committed to developing and commercializing innovative therapeutics to help improve the lives of patients with serious eye disorders. The Company’s pipeline leverages its proprietary Durasert® technology for sustained intraocular drug delivery including EYP-1901, a potential twice-yearly sustained delivery intravitreal anti-VEGF treatment initially targeting wet age-related macular degeneration. The Company has two commercial products: YUTIQ®, for the treatment of chronic non-infectious uveitis affecting the posterior segment of the eye, and DEXYCU®, for the treatment of postoperative inflammation following ocular surgery. EyePoint Pharmaceuticals is headquartered in Watertown, Massachusetts. To learn more about the Company, please visit www.eyepointpharma.com and connect on Twitter and LinkedIn.

SAFE HARBOR STATEMENTS UNDER THE PRIVATE SECURITIES LITIGATION ACT OF 1995: To the extent any statements made in this press release deal with information that is not historical, these are forward-looking statements under the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements regarding the anticipated use of proceeds for the proposed offering and other statements identified by words such as “will,” “potential,” “could,” “can,” “believe,” “intends,” “continue,” “plans,” “expects,” “anticipates,” “estimates,” “may,” other words of similar meaning or the use of future dates. Forward-looking statements by their nature address matters that are, to different degrees, uncertain. Uncertainties and risks may cause EyePoint’s actual results to be materially different than those expressed in or implied by EyePoint’s forward-looking statements. For EyePoint, this includes the continued impact of the COVID-19 pandemic on EyePoint’s business, the medical community and the global economy and the impact of general business and economic conditions, our expectations regarding the timing and clinical development of our product candidates, including EYP-1901; and the potential for EYP-1901 as a novel twice-yearly treatment for serious eye diseases, including wet age-related macular degeneration, diabetic retinopathy and retinal vein occlusion; the effectiveness and timeliness of clinical trials, and the usefulness of the data; the timeliness of regulatory approvals; our ability to achieve profitable operations and access to needed capital; fluctuations in our operating results; our ability to successfully produce sufficient commercial quantities of YUTIQ and DEXYCU and to successfully commercialize YUTIQ and DEXYCU in the U.S.; our ability to sustain and enhance an effective commercial infrastructure and enter into and maintain commercial agreements for YUTIQ and DEXYCU; the development of our YUTIQ line extension shorter-duration treatment for non-infectious uveitis affecting the posterior segment of the eye; the success of current and future license agreements, including our agreements with Ocumension Therapeutics and Equinox Science; termination or breach of current license agreements, including our agreements with Ocumension Therapeutics and Equinox Science; our dependence on contract research organizations, co-promotion partners, and other outside vendors and service providers; effects of competition and other developments affecting sales of products; market acceptance of products; effects of guidelines, recommendations and studies; protection of intellectual property and avoiding intellectual property infringement; retention of key personnel; product liability; industry consolidation; compliance with environmental laws; manufacturing risks; risks and costs of international business operations; volatility of stock price; possible dilution; absence of dividends; and other factors described in our filings with the Securities and Exchange Commission. We cannot guarantee that the results and other expectations expressed, anticipated or implied in any forward-looking statement will be realized. A variety of factors, including these risks, could cause our actual results and other expectations to differ materially from the anticipated results or other expectations expressed, anticipated or implied in our forward-looking statements. Should known or unknown risks materialize, or should underlying assumptions prove inaccurate, actual results could differ materially from past results and those anticipated, estimated or projected in the forward-looking statements. You should bear this in mind as you consider any forward-looking statements. Our forward-looking statements speak only as of the dates on which they are made. We do not undertake any obligation to publicly update or revise our forward-looking statements even if experience or future changes makes it clear that any projected results expressed or implied in such statements will not be realized.

Investors:

Christina Tartaglia
SternIR
Direct: 212-698-8700
[email protected]

Media:

Green Room Public Relations
Caren Begun
Green Room Communications
Direct: (201) 396-8551
[email protected]

EYEPOINT PHARMACEUTICALS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(In thousands, except per share data)

	Three Months Ended March 31,
	2021			2020
Revenues:
Product sales, net	$	6,802		$	4,687
License and collaboration agreements		341			2,020
Royalty income		180			782
Total revenues		7,323			7,489
Operating expenses:
Cost of sales, excluding amortization of acquired intangible assets		1,390			980
Research and development		5,479			4,853
Sales and marketing		5,659			8,125
General and administrative		5,115			4,360
Amortization of acquired intangible assets		615			615
Total operating expenses		18,258			18,933
Loss from operations		(10,935	)		(11,444	)
Other income (expense):
Interest and other income, net		1			54
Interest expense		(1,346	)		(1,784	)
Total other expense, net		(1,345	)		(1,730	)
Net loss	$	(12,280	)	$	(13,174	)
Net loss per common share – basic and diluted	$	(0.50	)	$	(1.14	)
Weighted average common shares outstanding – basic and diluted		24,735			11,553

EYEPOINT PHARMACEUTICALS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands)

	March 31,			December 31,
	2021			2020
Assets
Current assets:
Cash and cash equivalents	$	138,579		$	44,909
Accounts and other receivables, net		12,332			9,453
Prepaid expenses and other current assets		2,856			3,419
Inventory		5,586			5,337
Total current assets		159,353			63,118
Operating lease right-of-use assets		2,484			2,610
Intangible assets, net		24,594			25,209
Other assets		709			780
Total assets	$	187,140		$	91,717
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable and accrued expenses	$	11,770		$	13,256
Deferred Revenue		973			945
Other current liabilities		698			687
Total current liabilities		13,441			14,888
Long-term debt		38,124			37,977
Deferred revenue – noncurrent		15,349			15,616
Operating lease liabilities – noncurrent		2,172			2,330
Other long-term liabilities		2,347			2,365
Total liabilities		71,433			73,176
Stockholders’ equity:
Capital		637,826			528,380
Accumulated deficit		(522,960	)		(510,680	)
Accumulated other comprehensive income		841			841
Total stockholders’ equity		115,707			18,541
Total liabilities and stockholders’ equity	$	187,140		$	91,717

May 5, 2021 7:04 am

Stingray to Release its Full Year Fiscal 2021 Results

MONTREAL, May 05, 2021 (GLOBE NEWSWIRE) — Stingray Group Inc. (TSX: RAY.A; RAY.B) will release its financial results for the fourth quarter and fiscal year ended March 31, 2021, on Wednesday, June 2, 2021, after the market closes. Management will hold a conference call to discuss the financial results the next day, Thursday, June 3, 2021, at 10:00 a.m. Eastern Time.

Details of the Conference Call

Via the internet at www.stingray.com

Via telephone: (877) 223-4471 or (647) 788-4922

Conference Call Rebroadcast

A rebroadcast of the conference call will be available two hours after its broadcast, and until midnight, July 3, 2021, by dialing (800) 585-8367 or (416) 621-4642 and entering passcode 6594453.

About Stingray

Montreal-based Stingray (TSX: RAY.A; RAY.B) is a leading global music, media, and technology company with over 1,200 employees worldwide. Stingray is a premium provider of curated direct-to-consumer and B2B services, including audio television channels, over 100 radio stations, SVOD content, 4K UHD television channels, FAST channels, karaoke products, digital signage, in-store music, and music apps, which have been downloaded over 160 million times. Stingray reaches 400 million subscribers (or users) in 160 countries. For more information: www.stingray.com.

Contact information:

Mathieu Peloquin
Senior Vice-President, Marketing and Communications
Stingray Digital Group Inc.
(514) 664-1244, ext. 2362
[email protected]

May 5, 2021 7:04 am

HydraFacial and Vesper Healthcare Announce Closing of Business Combination, Combined Company Will be Known as The Beauty Health Company

HydraFacial and Vesper Healthcare Announce Closing of Business Combination, Combined Company Will be Known as The Beauty Health Company

The Beauty Health Company will be listed on the Nasdaq Capital Market under the ticker “SKIN”

MIAMI BEACH, Fla. & LONG BEACH, Calif.–(BUSINESS WIRE)–
Vesper Healthcare Acquisition Corp (“Vesper Healthcare”), a publicly traded special purpose acquisition company, and The HydraFacial^® Company (“HydraFacial”), a global category-creating beauty health company, today announced the closing of their previously announced business combination. The combined company will be known as The Beauty Health Company (“BeautyHealth” or the “Company”). The business combination was approved by Vesper Healthcare’s stockholders on April 29, 2021, with approximately 96% of the votes cast in favor of the transaction. Prior to the business combination, HydraFacial was owned by two leading healthcare industry private equity firms, Linden Capital Partners (“Linden”), who will continue to be the largest shareholder in the Company, and DW Healthcare Partners IV, LP (“DW Healthcare Partners”), who will continue to have a significant stake in the Company. As a result of the business combination, HydraFacial is now a wholly owned subsidiary of BeautyHealth. Beginning May 6, 2021, BeautyHealth’s shares will trade on the Nasdaq Capital Market under the ticker symbol “SKIN.”

BeautyHealth will be led by HydraFacial’s senior management team, including Chief Executive Officer Clint Carnell and Chief Financial Officer Liyuan Woo. Brent Saunders, CEO and co-founder of Vesper Healthcare, will serve as Executive Chairman.

The combined company will leverage the deep expertise of its management team to expand and accelerate growth in the emerging category of beauty health. The enhanced capital structure will allow BeautyHealth to make appropriate investments in innovation, geographic expansion, and important strategic acquisitions.

Clint Carnell, BeautyHealth CEO, stated: “Today marks an important milestone and an exciting moment for our Company as we enter the public markets. With HydraFacial, we transformed into a category-creating beauty health company. As BeautyHealth, we intend to continue our global expansion and bring additional innovative products to market. The added resources from this transaction will allow us to expand HydraFacial’s footprint in the large and growing beauty health category, as well as drive growth in the U.S. and internationally. Our accomplished team has been further strengthened by the combination with the Vesper Healthcare team, and we could not be more pleased to partner with Brent. I look forward to our next chapter and expect this combination will provide us with the resources and expertise to deliver sustained long-term growth.”

“We are pleased to close the business combination with HydraFacial and unveil the formation of The Beauty Health Company,” said Brent Saunders, BeautyHealth Executive Chairman. “HydraFacial is an impressive category-creating product in an attractive and growing market and provides the perfect platform to achieve our goal of building a premier company in beauty health. We anticipate more opportunities ahead and are excited about the potential to create a valuable, industry-leading, global company in beauty health.”

Brian Miller, Managing Partner at Linden, Kam Shah, Partner at Linden, and Doug Schillinger, Managing Director at DW Healthcare Partners, added, “We are proud of the growth HydraFacial has achieved since we acquired the company in 2016, and we are excited to participate in the newly formed BeautyHealth’s future success.”

Advisors

Goldman Sachs & Co. LLC acted as an exclusive financial advisor and private placement agent and Wachtell, Lipton, Rosen & Katz served as legal advisor to Vesper Healthcare. Jefferies LLC acted as Lead Financial Advisor, Piper Sandler served as Financial Advisor and Kirkland & Ellis LLP acted as legal advisor to HydraFacial.

About The Beauty Health Company

BeautyHealth is a category-creating beauty health company focused on bringing innovative products to market. Our flagship brand HydraFacial is a non-invasive, and approachable beauty health platform and ecosystem with a powerful community of estheticians, consumers and partners, bridging medical and consumer retail to democratize and personalize skin care solutions for the masses. Leading the charge in beauty health as a category-creator, HydraFacial uses a unique delivery system to cleanse, extract, and hydrate with their patented hydradermabrasion technology and super serums that are made with nourishing ingredients, providing an immediate outcome and creating an instantly gratifying glow in just three steps and 30 minutes. HydraFacial^® and Perk™ products are available in over 87 countries with over 16,000 delivery systems globally and millions of treatments performed each year. For more information, visit the brand on LinkedIn, Facebook, Instagram, or at HydraFacial.com. For more information, please visit at https://investors.beautyhealth.com/.

About Vesper Healthcare Acquisition Corp.

Vesper Healthcare Acquisition Corp. was a special purpose acquisition company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, with the intention to focus its search on companies in the pharmaceutical and healthcare sectors.

About Linden Capital Partners

Linden Capital Partners is a Chicago-based private equity firm focused exclusively on the healthcare industry. Founded in 2004, Linden is one of the country’s largest dedicated healthcare private equity firms. Linden’s strategy is based upon three elements: (i) healthcare specialization, (ii) integrated private equity and operating expertise, and (iii) its differentiated human capital program. Linden invests in middle market platforms in the medical products, specialty distribution, pharmaceutical, and services segments of healthcare. Since its founding, Linden has invested more than $2.5 billion in healthcare companies and has raised over $3 billion of commitments, augmented by capital provided by the firm’s limited partners for larger transactions. For more information, please visit www.lindenllc.com.

About DW Healthcare Partners

DW Healthcare Partners is a private equity firm focused exclusively on the healthcare industry. The firm manages over $1.43 billion in aggregate capital commitments and invests in leading healthcare companies with proven management teams. DW Healthcare Partners is led by seasoned healthcare executives with more than 120 years of combined industry experience. The firm provides the capital, strategic guidance, and acquisition expertise to help mid-stage companies realize their growth potential. For more information, please visit: www.dwhp.com

Forward-Looking Statements

Certain statements made in this release are “forward looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. When used in this press release, the words “estimates,” “projected,” “expects,” “anticipates,” “forecasts,” “plans,” “intends,” “believes,” “seeks,” “may,” “will,” “should,” “future,” “propose” and variations of these words or similar expressions (or the negative versions of such words or expressions) are intended to identify forward-looking statements.

These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside The Beauty Health Company’s control, that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements.

Important factors, among others, that may affect actual results or outcomes include the inability to recognize the anticipated benefits of the Business Combination; costs related to the Business Combination; the inability to maintain the listing of The Beauty Health Company’s shares on Nasdaq; The Beauty Health Company’s ability to manage growth; The Beauty Health Company’s ability to execute its business plan and meet its projections; potential litigation involving The Beauty Health Company; changes in applicable laws or regulations; the possibility that The Beauty Health Company may be adversely affected by other economic, business, and/or competitive factors; and the impact of the continuing COVID-19 pandemic on the Company’s business. The Beauty Health Company does not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210505005154/en/

ICR, Inc.

Investors: Dawn Francfort

Email: [email protected]

Press: Alecia Pulman

Email: [email protected]

KEYWORDS: California Florida United States North America

INDUSTRY KEYWORDS: Cosmetics Retail Health Other Health Alternative Energy Energy

MEDIA:

May 5, 2021 7:04 am

Evoqua Water Technologies Reports Second Quarter 2021 Results

Second Quarter 2021 Financial Highlights:

Revenue of $346.6 million, declined 1.5% compared to the prior year period
Net income of $5.1 million, declined 35.4% compared to the prior year period; diluted earnings per share of $0.04
Adjusted EBITDA of $58.0 million, increased 2.3% compared to the prior year period
Operating cash flow of $63.1 million year to date, increased $24.2 million compared to the prior year period

PITTSBURGH–(BUSINESS WIRE)–
Evoqua Water Technologies (NYSE:AQUA), an industry leader in mission-critical water treatment solutions, today reported results for its second quarter ended March 31, 2021.

Revenue for the second quarter of fiscal 2021 was $346.6 million, compared to $351.7 million in the prior year period, a decrease of 1.5%, or $5.1 million. Organic revenue declined 3.5%, or $12.3 million, as compared to the prior year period, mostly related to the pandemic’s continued impact on volume, as well as the timing of completion of certain large projects in the prior year, partially offset by an increase in revenue from acquisitions of 0.6%, or $2.0 million. The decline in revenue was also partially offset by a favorable change in foreign currency translation of 1.5% or $5.2 million. Net income for the quarter was $5.1 million, resulting in diluted earnings per share (“EPS”) of $0.04, as compared to net income of $7.9 million and diluted EPS of $0.06 in the prior year period. The decline in net income of 35.4% as compared to the prior year period was primarily related to an increase in tax expense of $2.7 million. Adjusted EBITDA for the quarter was $58.0 million as compared to $56.7 million in the prior year period, an increase of 2.3%. See the “Use of Non-GAAP Measures” section below for additional information regarding adjusted EBITDA and organic revenue.

“I am pleased with the overall results delivered in the quarter. Our team has performed very well operationally and financially over the past year, highlighting the resiliency of our business and the essential nature of the work we perform. Near term visibility continues to remain uncertain due to COVID-19, but we feel very well positioned for profitable growth,” said Mr. Ron Keating, Evoqua’s CEO.

Mr. Keating stated, “We have been driving our sales efforts to cultivate our large and growing opportunity pipeline while also focusing on operational execution, and this quarter we reported year-over-year increases in many key financial metrics. We recently completed our third acquisition in the last eight months, acquiring Water Consulting Specialists, and we welcome them to the Evoqua family. We also completed a debt refinancing that reduced our weighted average cost of debt, increased our borrowing capacity, and extended our maturities. Through this transaction we used $100 million of cash to reduce our term loan, representing another strategic action taken to strengthen our balance sheet.”

“Market segments remain mixed in capital and maintenance spending as near-term demand remains uncertain. With a growing backlog, we are focused on converting our robust opportunity pipeline and our existing order book as customers are willing to reopen or invest. With our current visibility, we are projecting a full-year outlook for revenue to be in the range of $1.43 billion to $1.47 billion and adjusted EBITDA to be in the range of $240 million to $255 million. Additionally, for the third quarter, we expect revenues to be between $350 million and $365 million and adjusted EBITDA to be in the range of $60 million to $64 million,” commented Mr. Keating.

Second Quarter Segment Results

Evoqua has two reportable operating segments – Integrated Solutions and Services and Applied Product Technologies. The results of our segments for the second quarter are as follows:

Integrated Solutions and Services

Segment revenue decreased by $13.7 million, or 5.8%, to $224.2 million in the second quarter of fiscal 2021 as compared to the prior year period.

Capital revenue declined $14.0 million as compared to the prior year period, primarily related to the timing of projects in the microelectronics end market, which was partially offset by new projects across a variety of end markets.
Service and aftermarket revenue increased $0.3 million, including contributions from recent acquisitions.

Operating profit decreased by $5.9 million, or 16.1%, to $30.8 million in the second quarter of fiscal 2021 as compared to $36.7 million in the prior year period.

Segment profitability decreased by $7.5 million as compared to the prior year period due to lower revenue volume and less favorable mix driven primarily by reductions and delays in customer capital spending and lower productivity related to enhanced safety protocols as a result of the COVID-19 pandemic, as well as increased allocation of corporate expenses. These declines were partially offset by additional price realization in the current period.
Decreases in travel and discretionary spending of $3.1 million positively impacted segment profitability, partially offset by $0.4 million of higher employee expenses.
Higher restructuring and other non-recurring costs reduced operating profit by $1.2 million.
Depreciation expense was $0.1 million lower as compared to the prior year period.

Segment adjusted EBITDA decreased by $4.8 million, or 8.9%, to $49.3 million in the second quarter of fiscal 2021 as compared to the prior year period. The decline in segment adjusted EBITDA resulted from the same factors that impacted operating profit, other than the change in depreciation and amortization, and also excludes restructuring and other non-recurring activity recognized in the period. See the “Use of Non-GAAP Measures” section below for a reconciliation of adjusted EBITDA to segment operating profit, its most directly comparable financial measure presented in accordance with GAAP.

Applied Product Technologies

Segment revenue increased by $8.6 million, or 7.6%, to $122.4 million in the second quarter of fiscal 2021 as compared to the prior year period.

Revenue increased by $10.0 million in the Asia Pacific region as compared to the prior year period, resulting from growth across multiple product lines. This volume increase was partially offset by revenue declines across multiple product lines in both the Americas and EMEA regions of $5.0 million and $1.1 million, respectively, mainly due to continued customer site access challenges and delays.
Foreign currency translation increased revenue by $4.7 million as compared to the prior year period.

Operating profit decreased by $5.7 million, or 23.9%, to $18.1 million for the second quarter of fiscal 2021 as compared to $23.8 million in the prior year period.

The decline in segment profitability was primarily driven by other income of $9.0 million in the prior year period related to the net working capital settlement on the sale of the Memcor product line.
Organic revenue volume, favorable product mix and price which offset inflation, as well as improvement in operational efficiencies and cost containment measures, increased operating profit by a total of $3.0 million as compared to the prior year period.
Favorable foreign currency translation increased operating profit by $1.0 million as compared to the prior year period.
Higher restructuring and other non-recurring costs and employee related expenses reduced operating profit by $0.7 million as compared to the prior year period. The change in depreciation expense as compared to the prior year was immaterial.

Segment adjusted EBITDA increased by $3.6 million, or 16.6%, to $25.3 million in the second quarter of fiscal 2021 as compared to the prior year period. The change in segment adjusted EBITDA was driven by the same factors that impacted segment operating profit, other than the change in depreciation and amortization, and also excludes restructuring and other non-recurring activity, including the $9.0 million gain recognized in the prior year period related to the divestiture of the Memcor product line. See the “Use of Non-GAAP Measures” section below for a reconciliation of adjusted EBITDA to segment operating profit, its most directly comparable financial measure presented in accordance with GAAP.

Second Quarter Earnings Call and Webcast

The Company will hold its second quarter fiscal 2021 earnings conference call Wednesday, May 5, 2021, at 10:00 a.m. E.T. The live audio webcast and presentation slides for the call will be accessible via Evoqua’s Investor Relations website, http://aqua.evoqua.com/.

Conference telephone number:

US Participant Dial-in: (866) 690-2108

International Participant Dial-in: (918) 398-8081

Conference ID: 5539696

The link to the webcast replay as well as the presentation slides will also be posted on Evoqua’s Investor Relations website.

US Replay: (855) 859-2056

International Replay: (404) 537-3406

Replay available: Beginning 1:00 p.m. E.T. on May 5 until 11:59 p.m. on May 19, 2021

Conference ID: 5539696

About Evoqua Water Technologies

Evoqua Water Technologies is a leading provider of mission critical water and wastewater treatment solutions, offering a broad portfolio of products, services and expertise to support industrial, municipal and recreational customers who value water. Evoqua has worked to protect water, the environment and its employees for more than 100 years, earning a reputation for quality, safety and reliability around the world. Headquartered in Pittsburgh, Pennsylvania, the company operates in more than 160 locations across ten countries. Serving more than 38,000 customers and 200,000 installations worldwide, our employees are united by a common purpose: Transforming Water. Enriching Life.

Use of Non-GAAP Financial Measures

This press release contains non-GAAP financial measures, which are adjusted financial measures that are not calculated and presented in accordance with generally accepted accounting principles in the United States, or “GAAP.” These non-GAAP adjusted financial measures are provided as additional information for investors. We believe these non-GAAP adjusted financial measures, which include organic revenue and adjusted EBITDA, are helpful to management and investors in highlighting trends in our operating results and provide greater clarity and comparability period over period to management and our investors regarding the operational impact of long-term strategic decisions regarding capital structure, the tax jurisdictions in which we operate and capital investments. The presentation of this additional information is not meant to be considered in isolation or as a substitute for GAAP measures. For definitions of the non-GAAP financial measures used in this press release and reconciliations to the most directly comparable respective GAAP measures, see the “Use of Non-GAAP Measures” section below.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All of these forward-looking statements are based on our current expectations, assumptions, estimates and projections. While we believe 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 our control. These and other important factors may cause our actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by these forward-looking statements, or could affect our share price. Some of the factors that could cause actual results to differ materially from those expressed or implied by the forward-looking statements include, among other things, general global economic and business conditions, including the impacts of the COVID-19 pandemic and disruptions in global oil markets; our ability to compete successfully in our markets; our ability to execute projects on budget and on schedule; the potential for us to incur liabilities to customers as a result of warranty claims or failure to meet performance guarantees; our ability to meet our customers’ safety standards or the potential for adverse publicity affecting our reputation as a result of incidents such as workplace accidents, mechanical failures, spills, uncontrolled discharges, damage to customer or third-party property or the transmission of contaminants or diseases; our ability to continue to develop or acquire new products, services and solutions and adapt our business to meet the demands of our customers, comply with changes to government regulations and achieve market acceptance with acceptable margins; our ability to implement our growth strategy, including acquisitions and our ability to identify suitable acquisition targets; our ability to operate or integrate any acquired businesses, assets or product lines profitably or otherwise successfully implement our growth strategy; our ability to achieve the expected benefits of our restructuring actions; material and other cost inflation and our ability to mitigate the impact of inflation by increasing selling prices and/or improving our productivity efficiencies; our ability to accurately predict the timing of contract awards; delays in enactment or repeals of environmental laws and regulations; the potential for us to become subject to claims relating to handling, storage, release or disposal of hazardous materials; our ability to retain our senior management and other key personnel; our increasing dependence on the continuous and reliable operation of our information technology systems; risks associated with product defects and unanticipated or improper use of our products; litigation, regulatory or enforcement actions and reputational risk as a result of the nature of our business or our participation in large-scale projects; seasonality of sales and weather conditions; risks related to government customers, including potential challenges to our government contracts or our eligibility to serve government customers; the potential for our contracts with federal, state and local governments to be terminated or adversely modified prior to completion; risks related to foreign, federal, state and local environmental, health and safety laws and regulations and the costs associated therewith; risks associated with international sales and operations, including our operations in the People’s Republic of China; our ability to adequately protect our intellectual property from third-party infringement; risks related to our substantial indebtedness; our need for a significant amount of cash, which depends on many factors beyond our control; and other risks and uncertainties, including those listed under Part I, Item 1A. “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended September 30, 2020, as filed with the SEC on November 20, 2020, and in other filings we may make from time to time with the SEC. All statements other than statements of historical fact included in this press release are forward-looking statements, including, but not limited to, expectations for the third quarter and full fiscal year 2021 and statements related to the COVID-19 pandemic, the impact of which remains inherently uncertain. Additionally, any forward-looking statements made in this press release speak only as of the date of this release. We undertake no obligation to update or revise, or to publicly announce any update or revision to, any of the forward-looking statements made herein, whether as a result of new information, future events or otherwise. These forward-looking statements should not be relied upon as representing the Company’s views as of any date subsequent to the date of this release.

EVOQUA WATER TECHNOLOGIES CORP. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (In thousands, except per share amounts)

	Three Months Ended March 31,						Six Months Ended March 31,
	2021			2020			2021			2020
Revenue from product sales and services	$	346,564		$	351,663		$	668,757		$	697,768
Cost of product sales and services	(240,645		)	(240,457		)	(467,493		)	(480,847		)
Gross profit	$	105,919		$	111,206		$	201,264		$	216,921
General and administrative expense	(52,928		)	(62,130		)	(95,211		)	(107,900		)
Sales and marketing expense	(33,830		)	(33,976		)	(67,758		)	(71,990		)
Research and development expense	(3,393		)	(3,189		)	(6,516		)	(6,873		)
Total operating expenses	$	(90,151	)	$	(99,295	)	$	(169,485	)	$	(186,763	)
Other operating income, net	410			9,244			633			60,689
Income before interest expense and income taxes	$	16,178		$	21,155		$	32,412		$	90,847
Interest expense	(8,395		)	(13,252		)	(17,068		)	(26,835		)
Income before income taxes	$	7,783		$	7,903		$	15,344		$	64,012
Income tax (expense) benefit	(2,701		)	7			(3,785		)	(2,596		)
Net income	$	5,082		$	7,910		$	11,559		$	61,416
Net income attributable to non‑controlling interest	46			98			90			459
Net income attributable to Evoqua Water Technologies Corp	$	5,036		$	7,812		$	11,469		$	60,957
Basic income per common share	$	0.04		$	0.07		$	0.10		$	0.52
Diluted income per common share	$	0.04		$	0.06		$	0.09		$	0.50

EVOQUA WATER TECHNOLOGIES CORP. CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands, except per share amounts)

	(Unaudited)
	March 31, 2021			September 30, 2020
ASSETS
Current assets	$	717,132		$	695,712
Cash and cash equivalents	222,718			193,001
Receivables, net	227,343			260,479
Inventories, net	156,787			142,379
Contract assets	74,801			80,759
Other current assets	35,483			19,094
Property, plant, and equipment, net	371,868			364,461
Goodwill	404,393			397,205
Intangible assets, net	299,318			309,967
Operating lease right-of-use assets, net	47,591			45,965
Other non-current assets	39,497			31,148
Total assets	$	1,879,799		$	1,844,458
LIABILITIES AND EQUITY
Current liabilities	$	346,573		$	349,555
Accounts payable	144,613			153,890
Current portion of debt, net of deferred financing fees	21,343			14,339
Contract liabilities	36,894			26,259
Accrued expenses and other liabilities	134,692			143,389
Other current liabilities	9,031			11,678
Non-current liabilities	1,008,341			1,012,840
Long-term debt, net of deferred financing fees	859,692			861,695
Obligation under operating leases	39,174			37,796
Other non-current liabilities	109,475			113,349
Total liabilities	$	1,354,914		$	1,362,395
Shareholders’ equity
Common stock, par value $0.01: authorized 1,000,000 shares; issued 121,442 shares, outstanding 119,778 at March 31, 2021; issued 119,486 shares, outstanding 117,291 at September 30, 2020	$	1,215		$	1,189
Treasury stock: 1,664 shares at March 31, 2021 and 2,195 shares at September 30, 2020	(2,837		)	(2,837		)
Additional paid-in capital	564,034			564,928
Retained deficit	(51,195		)	(62,664		)
Accumulated other comprehensive income (loss), net of tax	12,009			(20,472		)
Total Evoqua Water Technologies Corp. equity	$	523,226		$	480,144
Non-controlling interest	1,659			1,919
Total shareholders’ equity	$	524,885		$	482,063
Total liabilities and shareholders’ equity	$	1,879,799		$	1,844,458

EVOQUA WATER TECHNOLOGIES CORP. CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN CASH FLOWS (Unaudited) (In thousands)

	Six Months Ended March 31,
	2021			2020
Operating activities
Net income	$	11,559		$	61,416
Reconciliation of net income to cash flows provided by operating activities:
Depreciation and amortization	54,607			52,514
Amortization of deferred financing fees (includes $0 and $1,795 write off of deferred financing fees)	1,044			3,103
Deferred income taxes	476			(1,209		)
Share-based compensation	6,233			5,984
Loss on sale of property, plant and equipment	807			170
Loss (gain) on sale of business	191			(68,051		)
Foreign currency exchange (gains) losses on intercompany loans and other non-cash items	(3,659		)	1,514
Changes in assets and liabilities	(8,200		)	(16,604		)
Net cash provided by operating activities	63,058			38,837
Investing activities
Purchase of property, plant and equipment	(36,297		)	(38,759		)
Purchase of intangibles	(539		)	(622		)
Proceeds from sale of property, plant and equipment	640			271
Proceeds from sale of business, net of cash of $0 and $12,117	897			118,894
Acquisitions	(8,743		)	(11,164		)
Net cash (used in) provided by investing activities	(44,042		)	68,620
Financing activities
Issuance of debt, net of deferred issuance costs	13,993			8,212
Borrowings under credit facility	—			2,597
Repayment of debt	(10,036		)	(109,333		)
Repayment of finance lease obligation	(6,901		)	(6,694		)
Payment of earn-out related to previous acquisitions	—			(175		)
Proceeds from issuance of common stock	13,430			8,333
Taxes paid related to net share settlements of share-based compensation awards	(1,863		)	(9,817		)
Distribution to non‑controlling interest	(350		)	(1,450		)
Net cash provided by (used in) financing activities	8,273			(108,327		)
Effect of exchange rate changes on cash	2,428			(516		)
Change in cash and cash equivalents	29,717			(1,386		)
Cash and cash equivalents
Beginning of period	193,001			109,881
End of period	$	222,718		$	108,495

Use of Non-GAAP Measures

The Company reports its financial results in accordance with U.S. generally accepted accounting principles (“GAAP”). However, management believes that certain non-GAAP financial measures provide users of the Company’s financial information with additional useful information in evaluating operating performance. We use the non-GAAP financial measures “adjusted EBITDA” and “organic revenue” in evaluating the strength and financial performance of our core business.

Adjusted EBITDA

Adjusted EBITDA is defined as net income (loss) before interest expense, income tax benefit (expense) and depreciation and amortization, adjusted for the impact of certain other items, including restructuring and related business transformation costs, non-cash share-based compensation, transaction costs and other gains, losses and expenses that we believe do not directly reflect our underlying business operations.

Adjusted EBITDA is one of the primary metrics used by management to evaluate the financial performance of our business. We present adjusted EBITDA because we believe it is frequently used by analysts, investors and other interested parties to evaluate and compare operating performance and value companies within our industry. Further, we believe it is helpful in highlighting trends in our operating results and provides greater clarity and comparability period over period to management and our investors regarding the operational impact of long-term strategic decisions regarding capital structure, the tax jurisdictions in which we operate and capital investments. In addition, adjusted EBITDA highlights true business performance by removing the impact of certain items that management believes do not directly reflect our underlying operations and provides investors with greater visibility into the ongoing organic drivers of our business performance.

Management uses adjusted EBITDA to supplement GAAP measures of performance as follows:

to assist investors and analysts in comparing our operating performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance;
in our management incentive compensation, which is based in part on components of adjusted EBITDA;
in certain calculations under our senior secured credit facilities, which use components of adjusted EBITDA;
to evaluate the effectiveness of our business strategies;
to make budgeting decisions; and
to compare our performance against that of other peer companies using similar measures.

In addition to the above, our chief operating decision maker uses adjusted EBITDA of each reportable operating segment to evaluate the operating performance of such segments. Adjusted EBITDA on a segment basis is defined as earnings before depreciation and amortization, adjusted for the impact of certain other items that have been reflected at the segment level. Adjusted EBITDA of the reportable operating segments do not include certain charges that are presented within corporate activities. These charges include certain restructuring and other business transformation charges that have been incurred to align and reposition the Company to the current reporting structure, acquisition related costs (including transaction costs and integration costs) and share-based compensation charges.

Adjusted EBITDA should not be considered a substitute for, or superior to, financial measures prepared in accordance with GAAP. The financial results prepared in accordance with GAAP and the reconciliations from these results included below should be carefully evaluated. You are encouraged to evaluate each adjustment and the reasons we consider it appropriate for supplemental analysis. In addition, in evaluating adjusted EBITDA, you should be aware that in the future, we may incur expenses similar to the adjustments in the presentation of adjusted EBITDA. Our presentation of adjusted EBITDA should not be construed as an inference that our future results will be unaffected by unusual or nonrecurring items. In addition, adjusted EBITDA may not be comparable to similarly titled measures used by other companies in our industry or across different industries.

With respect to our guidance, we have not presented a quantitative reconciliation of the forward-looking non-GAAP financial measure adjusted EBITDA to its most directly comparable GAAP financial measure, net income, because it is impractical to forecast certain items without unreasonable efforts due to the uncertainty and inherent difficulty of predicting the occurrence and financial impact of, and the periods in which, such items, including foreign exchange impact and certain expenses for which we adjust, may be recognized. For the same reasons, we are unable to address the probable significance of the unavailable information, which could be material to future results.

The following is a reconciliation of our net income to adjusted EBITDA (unaudited):

	Three Months Ended March 31,								Six Months Ended March 31,
(In millions)	2021		2020			% Variance			2021		2020			% Variance
Net income	$	5.1	$	7.9		(35.4	)	%	$	11.6	$	61.4		(81.1	)	%
Income tax expense	2.7		—			**			3.7		2.6			42.3		%
Interest expense	8.4		13.3			(36.8	)	%	17.1		26.8			(36.2	)	%
Operating profit	$	16.2	$	21.2		(23.6	)	%	$	32.4	$	90.8		(64.3	)	%
Depreciation and amortization	27.1		27.3			(0.7	)	%	54.6		52.5			4.0		%
EBITDA	$	43.3	$	48.5		(10.7	)	%	$	87.0	$	143.3		(39.3	)	%
Restructuring and related business transformation costs (a)	5.4		6.2			(12.9	)	%	7.2		7.9			(8.9	)	%
Share-based compensation (b)	3.2		2.3			39.1		%	6.3		6.0			5.0		%
Transaction costs (c)	0.7		0.5			40.0		%	1.3		0.7			85.7		%
Other losses (gains) and expenses (d)	5.4		(0.8		)	(775.0	)	%	1.0		(57.6		)	(101.7	)	%
Adjusted EBITDA	$	58.0	$	56.7		2.3		%	$	102.8	$	100.3		2.5		%

** Percentage variance is not meaningful.

(a)	*Restructuring and related business transformation costs*
	Adjusted EBITDA is calculated prior to considering certain restructuring or business transformation events. These events may occur over extended periods of time, and in some cases it is reasonably possible that they could reoccur in future periods based on reorganizations of the business, cost reduction or productivity improvement needs, or in response to economic conditions. For the periods presented such events include the following:
	(i)	Certain costs and expenses in connection with various restructuring initiatives, including severance and other employee-related costs, relocation and facility consolidation costs and third-party consultant costs to assist with these initiatives. This includes:
		(A)	amounts related to the Company’s restructuring initiatives to reduce the cost structure and rationalize location footprint following the sale of the Memcor product line;
		(B)	amounts related to the Company’s transition from a three-segment structure to a two-segment operating model designed to better serve the needs of customers worldwide; and
		(C)	amounts related to various other initiatives implemented to restructure and reorganize our business with the appropriate management team and cost structure.

	Three Months Ended March 31,					Six Months Ended March 31,
(In millions)	2021		2020			2021		2020
Post Memcor divestiture restructuring	$	3.0	$	3.7		$	3.9	$	3.7
Cost of product sales and services (“Cost of sales”)	2.3		2.9			3.1		2.9
Sales and marketing expense (“S&M expense”)	—		0.1			0.2		0.1
General and administrative expense (“G&A expense”)	0.3		0.7			0.3		0.7
Other operating (income) expense	0.4		—			0.3		—
Two-segment restructuring	$	0.4	$	0.3		$	0.6	$	1.3
Cost of sales	0.2		0.3			0.2		0.6
G&A expense	0.2		0.4			0.4		0.7
Other operating (income) expense	—		(0.4		)	—		—
Various other initiatives	$	1.5	$	0.3		$	1.5	$	0.5
Cost of sales	0.5		0.3			0.5		0.4
S&M expense	0.1		—			0.1		—
G&A expense	0.4		—			0.4		0.1
Other operating (income) expense	0.5		—			0.5		—
Total⁽¹⁾	$	4.9	$	4.3		$	6.0	$	5.5

		(i)	of which $5.5 million and $5.6 million for the six months ended March 31, 2021 and 2020, respectively, is reflected in restructuring charges in Note 14, “Restructuring and Related Charges,” to our Consolidated Financial Statements to be included in our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2021.
	(ii)	Legal settlement costs and intellectual property related fees including fees and settlement costs associated with legacy matters, related to product warranty litigation on MEMCOR® products and certain discontinued products. This includes:

	Three Months Ended March 31,				Six Months Ended March 31,
(In millions)	2021		2020		2021		2020
Cost of sales	$	0.2	$	0.1	$	0.2	$	0.2
G&A expense	0.1		0.2		0.2		0.2
Total	$	0.3	$	0.3	$	0.4	$	0.4

(iii)

Expenses associated with our information technology and functional infrastructure transformation, including activities to optimize information technology systems and functional infrastructure processes. This includes:

	Three Months Ended March 31,					Six Months Ended March 31,
(In millions)	2021			2020		2021		2020
Cost of sales	$	0.1		$	—	$	0.1	$	0.1
G&A expense	(0.1		)	0.4		0.1		0.7
Total	$	—		$	0.4	$	0.2	$	0.8

(iv)

Costs associated with the secondary public offering of common stock held by certain shareholders of the Company, as well as costs incurred by us in connection with establishment of our public company compliance structure and processes, including consultant costs. This includes:

	Three Months Ended March 31,				Six Months Ended March 31,
(In millions)	2021		2020		2021		2020
G&A expense	$	0.2	$	1.2	$	0.6	$	1.2
Total	$	0.2	$	1.2	$	0.6	$	1.2

(b)		*Share-based compensation*
		Adjusted EBITDA is calculated prior to considering non-cash share-based compensation expenses related to equity awards. See Note 17, “Share-Based Compensation,” to our Consolidated Financial Statements to be included in our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2021 for further detail.
(c)		*Transaction related costs*
		Adjusted EBITDA is calculated prior to considering transaction, integration and restructuring costs associated with business combinations because these costs are unique to each transaction and represent costs that were incurred as a result of the transaction decision. Integration and restructuring costs associated with a business combination may occur over several years and include, but are not limited to, consulting fees, legal fees, certain employee-related costs, facility consolidation and product rationalization costs and fair value changes associated with contingent consideration. This includes:

	Three Months Ended March 31,					Six Months Ended March 31,
(In millions)	2021		2020			2021		2020
Cost of sales	$	0.1	$	(0.3	)	$	0.2	$	(0.2	)
G&A expense	0.6		0.5			1.1		0.9
Other operating (income) expense	—		0.3			—		—
Total	$	0.7	$	0.5		$	1.3	$	0.7

(d)	*Other losses, (gains) and expenses*
	Adjusted EBITDA is calculated prior to considering certain other significant (gains), losses and expenses. For the periods presented such events include the following:
	(i)	impact of foreign exchange gains and losses;
	(ii)	foreign exchange impact related to headquarter allocations;
	(iii)	net expense reduction related to the remediation of manufacturing defects caused by a third-party vendor for which partial restitution was received;
	(iv)	charges incurred by the Company related to product rationalization in its electro-chlorination business;
	(v)	amounts related to the prior year sale of the Memcor product line;
	(vi)	expenses incurred by the Company as a result of the COVID-19 pandemic, including additional charges for personal protective equipment, increased costs for facility sanitization and one-time payments to certain employees;
	(vii)	legal fees incurred in excess of amounts covered by the Company’s insurance related to the Securities Litigation and SEC investigation; and
	(viii)	loss on divestiture of the Lange containment system, geomembrane and geosynthetic liner product line (“Lange Product Line”).

	Other losses, (gains) and expenses include the following for the periods presented below:

Three Months Ended March 31, 2021
	Other Adjustments
(In millions)	(i)		(ii)		(iii)		(iv)		(v)		(vi)		(vii)		(viii)		Total
Cost of sales	$	—	$	—	$	—	$	0.7	$	—	$	0.1	$	—	$	—	$	0.8
G&A expense	2.9		—		—		—		—		0.1		1.4		—		4.4
Other operating (income) expense	—		—		—		—		—		—		—		0.2		0.2
Total	$	2.9	$	—	$	—	$	0.7	$	—	$	0.2	$	1.4	$	0.2	$	5.4

Three Months Ended March 31, 2020
	Other Adjustments
(In millions)	(i)		(ii)		(iii)			(iv)		(v)			(vi)		(vii)		(viii)		Total
Cost of sales	$	0.3	$	—	$	(0.1	)	$	0.2	$	0.1		$	—	$	—	$	—	$	0.5
G&A expense	7.8		—		—			—		(0.8		)	—		—		—		7.0
Other operating (income) expense	—		—		—			—		(8.3		)	—		—		—		(8.3		)
Total	$	8.1	$	—	$	(0.1	)	$	0.2	$	(9.0	)	$	—	$	—	$	—	$	(0.8	)

Six Months Ended March 31, 2021
	Other Adjustments
(In millions)	(i)			(ii)		(iii)		(iv)		(v)		(vi)		(vii)		(viii)		Total
Cost of sales	$	—		$	—	$	—	$	0.9	$	0.2	$	0.1	$	—	$	—	$	1.2
G&A expense	(3.9		)	—		—		—		—		0.2		3.3		—		(0.4		)
Other operating (income) expense	—			—		—		—		—		—		—		0.2		0.2
Total	$	(3.9	)	$	—	$	—	$	0.9	$	0.2	$	0.3	$	3.3	$	0.2	$	1.0

Six Months Ended March 31, 2020
	Other Adjustments
(In millions)	(i)			(ii)		(iii)			(iv)		(v)			(vi)		(vii)		(viii)		Total
Cost of sales	$	(0.1	)	$	—	$	0.1		$	0.3	$	0.2		$	—	$	—	$	—	$	0.5
G&A expense	1.6			0.1		—			—		0.1			—		—		—		1.8
Other operating (income) expense	—			—		(1.6		)	—		(58.3		)	—		—		—		(59.9		)
Total	$	1.5		$	0.1	$	(1.5	)	$	0.3	$	(58.0	)	$	—	$	—	$	—	$	(57.6	)

Adjusted EBITDA on a segment basis is defined as earnings before interest expense, income tax benefit (expense) and depreciation and amortization, adjusted for the impact of certain other items that have been reflected at the segment level. The following is a reconciliation of our segment operating profit to our segment adjusted EBITDA:

	Three Months Ended March 31,									Six Months Ended March 31,
	2021				2020					2021				2020
(In millions)	Integrated Solutions and Services		Applied Product Technologies		Integrated Solutions and Services		Applied Product Technologies			Integrated Solutions and Services		Applied Product Technologies		Integrated Solutions and Services		Applied Product Technologies
Operating Profit	$	30.8	$	18.1	$	36.7	$	23.8		$	57.1	$	31.5	$	69.8	$	86.9
Depreciation and amortization	17.2		3.6		17.3		3.5			34.1		7.1		33.0		7.1
EBITDA	$	48.0	$	21.7	$	54.0	$	27.3		$	91.2	$	38.6	$	102.8	$	94.0
Restructuring and related business transformation costs (a)	1.1		2.9		0.1		3.3			1.1		4.5		0.1		4.0
Transaction costs (b)	—		—		—		—			—		—		—		(1.3		)
Other losses (gains) and expenses (c)	0.2		0.7		—		(8.9		)	0.2		1.1		—		(59.2		)
Adjusted EBITDA	$	49.3	$	25.3	$	54.1	$	21.7		$	92.5	$	44.2	$	102.9	$	37.5

(a)		Represents costs and expenses in connection with restructuring initiatives distinct to our Applied Product Technologies segment in the three and six months ended March 31, 2021 and 2020, respectively. Such expenses are primarily composed of severance, relocation and facility consolidation costs.
(b)		Represents costs associated with a change in the current estimate of certain acquisitions achieving their earn-out targets, which resulted in a decrease to the fair valued amount of the earn-out recorded upon acquisition, in the six months ended March 31, 2020, distinct to our Applied Product Technologies segment.
(c)		Other losses, (gains) and expenses, as discussed above, distinct to our Integrated Solutions and Services (“ISS”) and Applied Product Technologies (“APT”) segments include the following:

	Three Months Ended March 31,									Six Months Ended March 31,
	2021				2020					2021				2020
(In millions)	ISS		APT		ISS		APT			ISS		APT		ISS		APT
Trailing costs from the sale of the Memcor product line	$	—	$	—	$	—	$	—		$	—	$	0.2	$	—	$	—
Net pre-tax benefit on sale of the Memcor product line	—		—		—		(9.0		)	—		—		—		(58.0		)
Remediation of manufacturing defects	—		—		—		(0.1		)	—		—		—		(1.5		)
Product rationalization in electro-chlorination business	—		0.7		—		0.2			—		0.9		—		0.3
Loss on divestiture of Lange Product Line	0.2		—		—		—			0.2		—		—		—
Total	$	0.2	$	0.7	$	—	$	(8.9	)	$	0.2	$	1.1	$	—	$	(59.2	)

Organic Revenue

Organic revenue is another metric used by management to evaluate the performance of our business. Organic revenue is defined as revenue excluding the impact of foreign currency translation and inorganic revenue. Inorganic revenue represents the impact from acquisitions and divestitures during the first 12 months following the closing of the acquisition or divestiture. Divestitures include sales of insignificant portions of our business that did not meet the criteria for classification as a discontinued operation. Management believes that reporting organic revenue provides useful information to investors by helping identify underlying growth trends in our core business and facilitating easier comparisons of our revenue performance with prior and future periods and to our peers. We exclude the effect of foreign currency translation from organic sales because foreign currency translation is not under management’s control, is subject to volatility and can obscure underlying business trends. We exclude the effect of acquisitions and divestitures because they can obscure underlying business trends and make comparisons of long-term performance difficult between the Company and its peers due to the varying nature, size and number of transactions from period to period.

The following is a reconciliation of total revenue to organic revenue for the three months ended March 31, 2021.

	Total Revenue							Foreign Currency					Inorganic Revenue⁽¹⁾						Organic Revenue
	Three Months Ended March 31,				% Variance			Three Months Ended March 31,			% Variance		Three Months Ended March 31,				% Variance		Three Months Ended March 31,				% Variance
(In millions)	2020			2021	% Variance			2020		2021	% Variance		2020			2021	% Variance		2020			2021	% Variance
Evoqua Water Technologies	$	351.7	$	346.6	(1.5	)	%	n/a	$	5.2	1.5	%	$	0.1	$	2.1	0.6	%	$	351.6	$	339.3	(3.5	)	%
Integrated Solutions & Services	$	237.9	$	224.2	(5.8	)	%	n/a	$	0.5	0.2	%	$	0.1	$	2.1	0.8	%	$	237.8	$	221.6	(6.8	)	%
Applied Product Technologies	$	113.8	$	122.4	7.6		%	n/a	$	4.7	4.1	%	$	—	$	—	—	%	$	113.8	$	117.7	3.5		%

	(i)	Includes divestiture of the Lange Product Line on March 1, 2021, acquisition of Aquapure Technologies on September 3, 2020 and acquisition of Ultrapure & Industrial Services on December 17, 2020.

Immaterial rounding differences may be present in the tables above.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210505005176/en/

Investors

Dan Brailer

Vice President, Investor Relations

Evoqua Water Technologies

Telephone: 724-720-1605

Email: [email protected]

Media

Sarah Brown

Director of Corporate Communications

Evoqua Water Technologies

Telephone: 506-454-5495

Email: [email protected]

KEYWORDS: United States North America Pennsylvania

INDUSTRY KEYWORDS: Other Natural Resources Environment Other Construction & Property Natural Resources Construction & Property Urban Planning

MEDIA:

May 5, 2021 7:04 am

Akoustis to Attend the 6th Annual Oppenheimer Emerging Growth Conference on May 11, 2021

Charlotte, N.C., May 05, 2021 (GLOBE NEWSWIRE) — Akoustis Technologies, Inc. (NASDAQ: AKTS) (“Akoustis” or the “Company”), an integrated device manufacturer (IDM) of patented bulk acoustic wave (BAW) high-band RF filters for mobile and other wireless applications, announced today that senior management will attend the 6^th Annual Oppenheimer Emerging Growth Conference on May 11, 2021.

Meetings will take place virtually given the ongoing call for social distancing due to the Covid-19 pandemic. Investors that would like to schedule a meeting with Akoustis management should contact their Oppenheimer representative or Akoustis’ investor relations at [email protected].

Akoustis is actively delivering volume production of its WiFi 6 tandem filter solutions, shipping multiple 5G small cell XBAW^® filter solutions, delivering initial designs of its new 5G mobile filter solutions to multiple customers and is now entering the market with its new WiFi 6E coexistence XBAW^® filter solutions.

Given the rapidly growing sales funnel activity as well as ongoing interaction with customers regarding expected ramps in both 5G mobile and WiFi 6E in calendar 2022, the Company plans to increase the annual production capacity at its New York fab by the end of calendar 2021 to approximately 500 million filters per year.

Akoustis currently has 15 commercial XBAW filters in its product catalog, and recently introduced 5.6 GHz and 6.6 GHz WiFi 6E coexistence filter modules, which when qualified, will bring the number of catalog products to 17. Current product catalog filters include a 5.6 GHz WiFi filter, a 5.2 GHz WiFi filter, a 5.5 GHz WiFi-6E filter, a 6.5 GHz WiFi 6E filter, three small cell 5G network infrastructure filters including two Band n77 filters and one Band n79 filter, a 3.8 GHz filter and five S-Band filters for defense phased-array radar applications, a 3.6 GHz filter for the CBRS 5G infrastructure market and a C-Band filter for the unmanned aircraft systems (UAS) market. The Company is also developing several new filters for the sub-7 GHz bands targeting 5G mobile device, network infrastructure, WiFi CPE and defense markets.

About Akoustis Technologies, Inc.

Akoustis^® (http://www.akoustis.com/) is a high-tech BAW RF filter solutions company that is pioneering next-generation materials science and MEMS wafer manufacturing to address the market requirements for improved RF filters – targeting higher bandwidth, higher operating frequencies and higher output power compared to incumbent polycrystalline BAW technology deployed today. The Company utilizes its proprietary XBAW^® manufacturing process to produce bulk acoustic wave RF filters for mobile and other wireless markets, which facilitate signal acquisition and accelerate band performance between the antenna and digital back end. Superior performance is driven by the significant advances of high-purity, single-crystal and associated piezoelectric materials and the resonator-filter process technology which drives electro-mechanical coupling and translates to wide filter bandwidth.

Akoustis plans to service the fast growing multi-billion-dollar RF filter market using its integrated device manufacturer (IDM) business model. The Company owns and operates a 120,000 sq. ft. ISO-9001:2015 registered commercial wafer-manufacturing facility located in Canandaigua, NY, which includes a class 100 / class 1000 cleanroom facility – tooled for 150-mm diameter wafers – for the design, development, fabrication and packaging of RF filters, MEMS and other semiconductor devices. Akoustis Technologies, Inc. is headquartered in the Piedmont technology corridor near Charlotte, North Carolina.

Forward-Looking Statements

This document includes “forward-looking statements” within the meaning of Section 27A of the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, that are intended to be covered by the “safe harbor” created by those sections. These forward-looking statements include, but are not limited to, statements about our estimates, expectations, beliefs, intentions, plans or strategies for the future (including our possible future results of operations, business strategies, competitive position, potential growth opportunities, potential market opportunities and the effects of competition), and the assumptions underlying such statements. Forward-looking statements include all statements that are not historical facts and typically are identified by use of terms such as “may,” “might,” “would,” “will,” “should,” “could,” “project,” “expect,” “plan,” “strategy,” “anticipate,” “attempt,” “develop,” “help,” “believe,” “think,” “estimate,” “predict,” “intend,” “forecast,” “seek,” “potential,” “possible,” “continue,” “future,” and similar words (including the negative of any of the foregoing), although some forward-looking statements are expressed differently. Forward-looking statements are neither historical facts nor assurances of future results, performance, events or circumstances. Instead, these forward-looking statements are based on management’s current beliefs, expectations and assumptions and are subject to risks and uncertainties. Factors that could cause actual results to differ materially from those currently anticipated include, without limitation, risks relating to our ability to obtain adequate financing and sustain our status as a going concern; our limited operating history; our inability to generate revenues or achieve profitability; the results of our research and development activities; our inability to achieve acceptance of our products in the market; the impact of a pandemic or epidemic or a natural disaster, including the COVID-19 pandemic, on our operations, financial condition and the worldwide economy, including its impact on our ability to access the capital markets; general economic conditions, including upturns and downturns in the industry; shortages in supplies needed to manufacture our products, or needed by our customers to manufacture devices incorporating our products; our limited number of patents; failure to obtain, maintain, and enforce our intellectual property rights; our inability to attract and retain qualified personnel; our reliance on third parties to complete certain processes in connection with the manufacture of our products; product quality and defects; existing or increased competition; our ability to successfully manufacture, market and sell products based on our technologies; our ability meet the required specifications of customers and achieve qualification of our products for commercial manufacturing in a timely manner; our ability to successfully scale our New York wafer fabrication facility and related operations while maintaining quality control and assurance and avoiding delays in output; the rate and degree of market acceptance of any of our products; our ability to achieve design wins from current and future customers; contracting with customers and other parties with greater bargaining power and agreeing to terms and conditions that may adversely affect our business; risks related to doing business in foreign countries, including China; any security breaches, cyber-attacks or other disruptions compromising our proprietary information and exposing us to liability; our failure to innovate or adapt to new or emerging technologies; our failure to comply with regulatory requirements; results of any arbitration or litigation that may arise; stock volatility and illiquidity; dilution caused by any future issuance of common stock or securities that are convertible into or exercisable for common stock; our failure to implement our business plans or strategies; and our ability to maintain effective internal control over financial reporting. These and other risks and uncertainties are described in more detail in the Risk Factors and Management’s Discussion and Analysis of Financial Condition and Results of Operations sections of the Company’s most recent Annual Report on Form 10-K and in subsequently filed Quarterly Reports on Form 10-Q. Considering these risks, uncertainties and assumptions, the forward-looking statements regarding future events and circumstances discussed in this document may not occur, and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements. You should not rely upon forward-looking statements as predictions of future events. The forward-looking statements included in this document speak only as of the date hereof and, except as required by law, we undertake no obligation to update publicly or privately any forward-looking statements, whether written or oral, for any reason after the date of this document to conform these statements to new information, actual results or to changes in our expectations.

Contact:

COMPANY:
Tom Sepenzis
Akoustis Technologies
VP of Corporate Development & IR
(980) 689-4961
[email protected]

The Del Mar Consulting Group, Inc.
Robert B. Prag, President
(858) 794-9500
[email protected]

May 5, 2021 7:04 am

Caesarstone Reports First Quarter 2021 Financial Results

Caesarstone Reports First Quarter 2021 Financial Results

– Record First Quarter Revenue Grew 15.4% Over Prior Year to $146.0 Million –

– Per Share Diluted Net Income of $0.41 and Adjusted Diluted EPS of $0.42 –

– Gross Margin Expanded 90 Basis Points to 29.7% –

– Adjusted EBITDA Increased 54.1% to $20.3 Million at a 13.9% Margin –

– Strong Net Cash Position^(*) of $105.3 Million at Quarter End –

– Declares Dividend of $0.21 per share –

– Reiterates Outlook for 2021 Revenue and Adjusted EBITDA Growth –

MP MENASHE, Israel–(BUSINESS WIRE)–
Caesarstone Ltd. (NASDAQ: CSTE), a leading developer and manufacturer of high-quality engineered surfaces, today reported financial results for its first quarter ended March 31, 2021.

“We are extremely pleased to produce another consecutive quarter of growth as we continue to successfully execute our strategy to transform Caesarstone into a leading premium, multi-material countertop company,” commented Yuval Dagim, Caesarstone’s Chief Executive Officer. “Our recently completed accretive acquisitions of Omicron and Lioli Ceramica are already contributing to results, helping us to deliver record first quarter revenue. Our collective actions since we announced our Global Growth Acceleration Plan two years ago have allowed us to establish an efficient global operating platform, resulting in our third consecutive quarter of year-on-year EBITDA margin expansion. We are encouraged with the progress we have made integrating Lioli and Omicron and are excited to further realize the unique benefits of each platform as a combined business. As we move forward, we will continue to leverage our innovative go-to-market initiatives, world-class brand and multi-material product offerings to drive additional value for our shareholders.”

(*) Cash position is defined as cash and cash equivalents and short-term bank deposits and long and short-term investment in marketable securities less debt from financial institutions.

First Quarter 2021 Results

Revenue in the first quarter of 2021 grew 15.4% to $146.0 million compared to $126.6 million in the prior year quarter. On a constant currency basis, first quarter revenue was higher by 9.8% year-over-year, due primarily to the contribution of acquisitions.

Gross margin in the first quarter improved to 29.7% compared to 28.8% in the prior year quarter. Adjusted gross margin in the first quarter was 30.1% compared to 28.9% in the prior year quarter. The year-over-year improvement in gross margin mainly reflects better product mix, improved efficiency and more favorable currency exchange rates, partly offset by the impact of higher manufacturing unit costs due to lower fixed cost absorption and lower selling prices.

Operating expenses in the first quarter were $33.3 million, or 22.8% of revenue, compared to $34.1 million, or 27.0% of revenue in the prior year quarter. Excluding legal settlements and loss contingencies, operating expenses were 22.3% of revenue, compared to 24.7% in the prior year quarter, mainly due to higher revenues.

Operating income grew to $10.0 million compared to operating income of $2.3 million in the prior year quarter. The year-over-year growth mainly reflects higher gross margin and lower legal settlements and loss contingencies.

Adjusted EBITDA, which excludes expenses for share-based compensation, legal settlements and loss contingencies and for non-recurring items, grew 54.1% year-over-year to $20.3 million in the first quarter, representing a margin of 13.9%. This compares to adjusted EBITDA of $13.1 million, representing a margin of 10.4%, in the prior year quarter. The year-over-year margin improvement primarily reflects the higher gross margin.

Finance income in the first quarter was $5.3 million compared to finance income of $0.9 million in the prior year quarter. The difference was primarily a result of the favorable impact of foreign currency exchange rates and raw material hedging activity.

Net Income attributable to controlling interest for the first quarter was $14.2 million compared to net income of $2.7 million in the prior year quarter. Net income per share for the first quarter was $0.41 compared to net income per share of $0.08 in the prior year quarter. Adjusted diluted net income per share for the first quarter was $0.42 on 34.5 million shares, compared to adjusted diluted net income per share of $0.13 in the prior year quarter on a similar share count.

Balance Sheet & Liquidity

The Company’s balance sheet as of March 31, 2021 remained strong, including cash, cash equivalents and short-term bank deposits and short and long-term marketable securities of $118.7 million and total debt to financial institutions of $13.4 million.

Dividend

The Company’s dividend policy provides for a quarterly cash dividend of up to 50% of reported net income on a year-to-date basis, less any amount already paid as dividend for the respective period (the “calculated dividend”), subject in each case to approval by the Company’s board of directors. No dividend is paid if it would be less than $0.10 per share. In accordance with the Company’s dividend policy, the board of directors declared a cash dividend of $0.21 per share for the three months ended March 31, 2021. The dividend will be paid on June 1, 2021 to shareholders of record as of May 18, 2021. The dividend payment is subject to withholding tax of 20%.

Outlook

The Company reiterates its expectation for 2021 revenue and Adjusted EBITDA to be higher year-over-year. The company anticipates revenue to grow faster than EBITDA in 2021 mainly due to higher shipping and raw material costs, coupled with a return to more normalized levels of sales and marketing expenses and other investments to support the Company’s growth initiatives. The Company’s outlook includes the investment costs associated with its Global Growth Acceleration Plan. The Company’s outlook also assumes that both pandemic related business restrictions will fade and that the supply environment will improve as the year progresses.

Webcast and Conference Call Details

The Company will host a live webcast and conference call today at 8:30 a.m. ET to discuss the results, followed by a question and answer session for the investment community. The live webcast of the call can be accessed at ir.caesarstone.com. For those unable to access the webcast, the conference call will be accessible by dialing 1-877-407-4018 (domestic) or +1-201-689-8471 (international). The toll-free Israeli number is 1 80 940 6247. Upon dialing in, please request to join the Caesarstone First Quarter Earnings Call.

To listen to a telephonic replay of the conference call, dial toll-free 1-844-512-2921 (domestic) or +1-412-317-6671 (international) and enter pass code 13718692. The replay will be available beginning at 11:30 a.m. ET on Wednesday, May 5, 2021 and will last through 11:59 p.m. ET on Wednesday, May 12, 2021.

About Caesarstone

Caesarstone is a concept and lifestyle-driven company with a customer-centered approach to designing, developing, and producing high-end engineered stone countertops, used in residential and commercial buildings. Our products offer superior aesthetic appeal and perfected functionality through a distinct variety of colors, styles, textures, and finishes used in diverse countertop applications, marked by inherent longevity. Strong commitment to service has fostered growing customer loyalty in over 50 countries where the Caesarstone product collections are available: Classico, Supernatural, Metropolitan and Outdoor. For more information please visit our website: www.caesarstone.com.

Non-GAAP Financial Measures

The non-GAAP measures presented by the Company should be considered in addition to, and not as a substitute for, comparable GAAP measures. Reconciliations of GAAP gross profit to adjusted gross profit, GAAP net income (loss) to adjusted net income (loss) and net income (loss) to Adjusted EBITDA are provided in the schedules to this release. To calculate revenues growth rates that exclude the impact of changes in foreign currency exchange rates, the Company converts actual reported results from local currency to U.S. dollars using constant foreign currency exchange rates in the current and comparable period. The Company provides these non-GAAP financial measures because it believes that they present a better measure of the Company’s core business and management uses the non-GAAP measures internally to evaluate the Company’s ongoing performance. Accordingly, the Company believes that they are useful to investors in enhancing an understanding of the Company’s operating performance.

Forward-Looking Statements

Information provided in this press release may contain statements relating to current expectations, estimates, forecasts and projections about future events that are “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements relate to the Company’s plans, objectives and expectations for future operations, including estimations relating to the impact of the COVID-19 pandemic and mitigation measures in connection thereto, expectations of the results of the Company’s business optimization initiative, integration of the company’s acquisitions and its projected outlook and results of operations. These forward-looking statements are based upon management’s current estimates and projections of future results or trends. Actual results may differ materially from those projected as a result of certain risks and uncertainties, both known or unknown. These factors include, but are not limited to: the impact of the COVID-19 pandemic on end-consumers, economic conditions in our key markets, raw material shortages and prices, fluctuations in home renovation and construction sectors; the company’s ability to compete with lower-priced products and other intense competitive pressures; the outcome of silicosis and other bodily injury claims; regulatory requirements relating to hazards associated with exposure to silica dust; ability to efficiently manufacture products and managing required changes in production and supply chain in light of our recent acquisitions; fluctuations in currency exchange rates; the success of our expansion efforts in the United States; unpredictability of seasonal fluctuations in revenues and other factors discussed under the heading “Risk Factors” in our most recent annual report on Form 20-F and other documents filed with the Securities and Exchange Commission. These forward-looking statements are made only as of the date hereof, and the Company undertakes no obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise.

Caesarstone Ltd. and its subsidiaries Condensed consolidated balance sheets

	As of
U.S. dollars in thousands	March 31, 2021	December 31, 2020
	(Unaudited)	(Audited)
ASSETS

CURRENT ASSETS:

Cash and cash equivalents and short-term bank deposits	$ 99,820	$ 114,248
Short-term available for sale marketable securities	11,697	8,112
Trade receivables, net	84,533	84,822
Other accounts receivable and prepaid expenses	35,425	26,481
Inventories	155,402	152,073

Total current assets	386,877	385,736

LONG-TERM ASSETS:

Severance pay fund	3,766	4,007
Other long-term receivables	3,773	3,837
Deferred tax assets, net	7,763	8,359
Long-term deposits and prepaid expenses	768	1,675
Operating lease right-of-use assets	121,531	123,928
Long-term available for sale marketable securities	7,170	10,926
Property, plant and equipment, net	219,631	222,883
Goodwill and intangible assets, net	58,717	59,570

Total long-term assets	423,119	435,185

Total assets	$ 809,996	$ 820,921

LIABILITIES AND EQUITY

CURRENT LIABILITIES:

Short-term bank credit	$ 4,403	$ 13,122
Trade payables	59,846	55,063
Related parties and other loans	2,227	2,221
Short term legal settlements and loss contingencies	19,277	31,039
Accrued expenses and other liabilities	54,391	55,570

Total current liabilities	140,144	157,015

LONG-TERM LIABILITIES:

Long-term bank and other loans and financing liability of land from a related party	17,213	20,706
Legal settlements and loss contingencies long-term	21,660	21,910
Deferred tax liabilities, net	6,456	6,943
Long-term lease liabilities	108,743	112,719
Accrued severance pay	5,129	5,303
Long-term warranty provision	1,274	1,274

Total long-term liabilities	160,475	168,855

REDEEMABLE NON-CONTROLLING INTEREST	7,500	7,701

EQUITY:

Ordinary shares	371	371
Treasury shares – at cost	(39,430)	(39,430)
Additional paid-in capital	160,651	160,083
Capital fund related to non-controlling interest	(5,587)	(5,587)
Accumulated other comprehensive loss	1,008	1,083
Retained earnings	384,864	370,830

Total equity	501,877	487,350

Total liabilities and equity	$ 809,996	$ 820,921

Caesarstone Ltd. and its subsidiaries Condensed consolidated statements of income
	Three months ended March 31,
U.S. dollars in thousands (except per share data)	2021	2020
	(Unaudited)

Revenues	$ 146,032	$ 126,557
Cost of revenues	102,730	90,156

Gross profit	43,302	36,401

Operating expenses:
Research and development	1,105	780
Marketing and selling	18,276	18,629
General and administrative	13,143	11,867
Legal settlements and loss contingencies, net	740	2,838

Total operating expenses	33,264	34,114

Operating income	10,038	2,287
Finance income, net	(5,333)	(869)

Income before taxes	15,371	3,156
Taxes on income	1,529	478

Net income	$ 13,842	$ 2,678

Net loss attributable to non-controlling interest	348	–

Net income attributable to controlling interest	$ 14,190	$ 2,678
Basic net income per ordinary share (*)	$ 0.41	$ 0.08
Diluted net income per ordinary share (*)	$ 0.41	$ 0.08
Weighted average number of ordinary shares used in computing basic income per ordinary share	34,439,783	34,399,916
Weighted average number of ordinary shares used in computing diluted income per ordinary share	34,489,432	34,448,505

(*) The numerator for the calculation of net income per share for the three months ended March 31, 2021 has been decreased by approximately $0.2 million, to reflect the adjustment to redemption value associated with the redeemable non-controlling interest.

Caesarstone Ltd. and its subsidiaries Selected Condensed consolidated statements of cash flows

	Three months ended March 31,
U.S. dollars in thousands	2021	2020
	(Unaudited)
Cash flows from operating activities:

Net income	$ 13,842	$ 2,678
Adjustments required to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	8,908	7,115
Share-based compensation expense	567	906
Accrued severance pay, net	69	(86)
Changes in deferred tax, net	101	(1,060)
Capital (gain) loss	(2)	17
Legal settlements and loss contingencies, net	740	2,838
Decrease (increase) in trade receivables	179	(3,075)
Decrease (increase) in other accounts receivable and prepaid expenses	(9,299)	2,268
Increase in inventories	(3,344)	(11,737)
Increase in trade payables	2,987	2,009
Increase (decrease) in warranty provision	(9)	52
Changes in right of use assets	2,328	2,576
Changes in lease liabilities	(3,968)	(515)
Amortization of premium and accretion of discount on marketable securities, net	70	–
Changes in Accrued interest related to Marketable Securities	13	–
Decrease in accrued expenses and other liabilities including related parties	(11,020)	(580)

Net cash provided by operating activities	2,162	3,406


Cash flows from investing activities:

Repayment of assumed shareholders loan related to acquisition	(1,966)	–
Purchase of property, plant and equipment	(4,727)	(8,500)
Proceeds from sale of property, plant and equipment	4	8
Investment in marketable securities	78	–
Increase in long term deposits	48	(731)

Net cash used in investing activities	(6,563)	(9,223)


Cash flows from financing activities:

Changes in short-term bank credits and long-term loans	(9,704)	(459)
Repayment of a financing leaseback related to Bar-Lev transaction	(323)	(305)

Net cash used in financing activities	(10,027)	(764)


Effect of exchange rate differences on cash and cash equivalents	–	(927)

Decrease in cash and cash equivalents and short-term bank deposits	(14,428)	(7,508)
Cash and cash equivalents and short-term bank deposits at beginning of the period	114,248	139,372

Cash and cash equivalents and short-term bank deposits at end of the period	$ 99,820	$ 131,864

Non – cash investing:
Changes in trade payables balances related to purchase of fixed assets	(158)	(564)

Caesarstone Ltd. and its subsidiaries

	Three months ended March 31,
U.S. dollars in thousands	2021	2020
	(Unaudited)
Reconciliation of Gross profit to Adjusted Gross profit:
Gross profit	$ 43,302	$ 36,401
Share-based compensation expense (a)	105	131
Amortization of assets related to acquisitions	534	–
Adjusted Gross profit (Non-GAAP)	$ 43,941	$ 36,532

(a)

Share-based compensation includes expenses related to stock options and restricted stock units granted to employees and directors of the Company.

Caesarstone Ltd. and its subsidiaries

	Three months ended March 31,
U.S. dollars in thousands	2021	2020
	(Unaudited)
Reconciliation of Net Income to Adjusted EBITDA:
Net income	$ 13,842	$ 2,678
Finance income, net	(5,333)	(869)
Taxes on income	1,529	478
Depreciation and amortization related to acquisitions	8,908	7,115
Legal settlements and loss contingencies, net (a)	740	2,838
Share-based compensation expense (b)	567	906

Adjusted EBITDA (Non-GAAP)	$ 20,253	$ 13,146

(a)	Consists of legal settlements expenses and loss contingencies, net, related to product liability claims and other adjustments to on-going legal claims, including related legal fees.
(b)	Share-based compensation includes expenses related to stock options and restricted stock units granted to employees and directors of the Company.

Caesarstone Ltd. and its subsidiaries

	Three months ended March 31,
U.S. dollars in thousands (except per share data)	2021	2020
	(Unaudited)
Reconciliation of net income attributable to controlling interest to adjusted net income attributable to controlling interest:
Net income attributable to controlling interest	$ 14,190	$ 2,678
Legal settlements and loss contingencies, net (a)	740	2,838
Amortization of assets related to acquisitions, net of tax	826	–
Share-based compensation expense (b)	567	906
Non cash revaluation of lease liabilities (c)	(1,862)	(1,471)
Total adjustments	271	2,273
Less tax on non-tax adjustments (d)	27	344
Total adjustments after tax	244	1,929

Adjusted net income attributable to controlling interest (Non-GAAP)	$ 14,434	$ 4,607
Adjusted diluted EPS (e)	$ 0.42	$ 0.13

(a)	Consists of legal settlements expenses and loss contingencies, net, related to product liability claims and other adjustments to on-going legal claims, including related legal fees.
(b)	Share-based compensation includes expenses related to stock options and restricted stock units granted to employees and directors of the Company.
(c)	Exchange rate differences deriving from revaluation of lease contracts in accordance with FASB ASC 842.
(d)	Tax adjustments for the three months ended March 31, 2021 and 2020, based on the effective tax rates.
(e)	In calculating adjusted diluted (Non-GAAP) EPS for the three months ended March 31, 2021 and 2020, the diluted weighted average number of shares outstanding excludes the effects of share-based compensation expense in accordance with FASB ASC 718.

Caesarstone Ltd. and its subsidiaries
Geographic breakdown of revenues by region

	Three months ended March 31,
U.S. dollars in thousands	2021	2020
	(Unaudited)

USA	$ 70,831	$ 60,055
Canada	17,779	18,558
Latin America	858	506
America’s	89,468	79,119

Australia	27,172	22,354
Asia	7,777	2,831
APAC	34,949	25,185

EMEA	12,718	11,340

Israel	8,897	10,913

Total Revenues	$ 146,032	$ 126,557

Caesarstone Ltd. and its subsidiaries
Geographic breakdown of revenues by region – Supplemental data

	Three months ended
U.S. dollars in thousands	3/31/2021	12/31/2020	9/30/2020	6/30/2020	3/31/2020	12/31/2019	9/30/2019	6/30/2019	3/30/2019
	(Unaudited)

USA	$ 70,831	$ 53,618	$ 52,097	$ 41,726	$ 60,055	$ 64,659	$ 64,805	$ 64,590	$ 56,417
Canada	17,779	20,325	19,174	14,435	18,558	20,575	21,881	23,341	20,178
Latin America	858	1,387	124	132	506	735	1,434	1,351	596
America’s	89,468	75,330	71,395	56,293	79,119	85,969	88,120	89,282	77,191

Australia	27,172	29,953	27,746	23,534	22,354	26,000	28,642	28,294	25,214
Asia	7,777	7,122	2,881	1,732	2,831	3,932	3,675	3,311	4,596
APAC	34,949	37,075	30,627	25,266	25,185	29,932	32,317	31,605	29,810

EMEA	12,718	14,408	11,422	8,031	11,340	9,464	11,719	11,418	10,455

Israel	8,897	10,083	10,478	9,447	10,913	8,502	10,683	8,766	10,741

Total Revenues	$ 146,032	$ 136,896	$ 123,922	$ 99,037	$ 126,557	$ 133,867	$ 142,839	$ 141,071	$ 128,197


	Year-over-year % change
	3/31/2021	12/31/2020	9/30/2020	6/30/2020	3/31/2020
	(Unaudited)

USA	17.9%	-17.1%	-19.6%	-35.4%	6.4%
Canada	-4.2%	-1.2%	-12.4%	-38.2%	-8.0%
Latin America	69.6%	88.8%	-91.4%	-90.2%	-15.1%
America’s	13.1%	-12.4%	-19.0%	-36.9%	2.5%

Australia	21.6%	15.2%	-3.1%	-16.8%	-11.3%
Asia	174.7%	81.1%	-21.6%	-47.7%	-38.4%
APAC	38.8%	23.9%	-5.2%	-20.1%	-15.5%

EMEA	12.2%	52.2%	-2.5%	-29.7%	8.5%

Israel	-18.5%	18.6%	-1.9%	7.8%	1.6%

Total Revenues	15.4%	2.3%	-13.2%	-29.8%	-1.3%


	*Year-over-year % change in constant currency ()**
	3/31/2021	12/31/2020	9/30/2020	6/30/2020	3/31/2020
	(Unaudited)

USA	17.9%	-17.1%	-19.6%	-35.4%	6.4%
Canada	-9.6%	-2.4%	-11.7%	-36.0%	-7.1%
Latin America	69.8%	88.7%	-91.3%	-90.2%	-15.2%
America’s	11.8%	-12.7%	-18.8%	-36.4%	2.7%

Australia	2.8%	7.9%	-7.1%	-11.5%	-3.3%
Asia	169.5%	80.7%	-21.2%	-45.9%	-37.1%
APAC	21.5%	17.5%	-8.7%	-15.1%	-8.5%

EMEA	3.3%	45.8%	-5.9%	-26.9%	11.4%

Israel	-24.6%	9.4%	-4.5%	4.5%	-1.5%

Total Revenues	9.8%	-0.4%	-14.4%	-28.3%	0.5%

(*) Change in revenues at constant currency is calculated so that revenues can be viewed without the impact of fluctuations s in foreign currency exchange rates, thereby facilitating period-to-period comparisons of business performance. Change in revenues adjusted for currency are calculated by translating current period activity in local currency using the comparable prior-year period’s currency conversion rate. Exchange rates used, are the representative exchange rate published by the Bank of Israel for the relevant periods.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210505005138/en/

Investor Relations:

ICR, Inc. – Rodny Nacier

[email protected]

+1 646 277-1237

KEYWORDS: Israel Middle East

INDUSTRY KEYWORDS: Interior Design Engineering Residential Building & Real Estate Manufacturing Commercial Building & Real Estate Construction & Property

MEDIA:

May 5, 2021 7:04 am

Astec Reports First Quarter 2021 Results

First Quarter 2021 Highlights (all comparisons are made to the prior year first quarter):

Net Sales decreased 1.5% to $284.4 million
Gross Profit Margin of 24.1% decreased 130 bps
Net Income decreased 57.8% to $8.7 million; Adjusted Net Income of $9.3 million decreased 57.9% from $22.1 million
Diluted EPS of $0.38 compared to $0.91; Adjusted EPS of $0.41 decreased from $0.97, which included $0.42 NOL tax benefit from CARES Act in prior year

CHATTANOOGA, Tenn., May 05, 2021 (GLOBE NEWSWIRE) — Astec Industries, Inc. (Nasdaq: ASTE) announced today its financial results for the first quarter of 2021.

First quarter of 2021 net sales of $284.4 million decreased 1.5% compared to $288.8 million for the first quarter of 2020. Domestic sales decreased $8.2 million or 3.5% due mainly to a used inventory reduction initiative in the first quarter of 2020. The sale of used inventory decreased $4.8 million or 55.8% in the first quarter versus last year. International sales increased $3.8 million or 6.9%.

Backlog as of March 31, 2021 of $420.8 million increased $175.4 million, or 71.5% compared to the backlog of $245.4 million a year ago. Domestic backlog increased by 74.4% to $322.9 million while international backlog increased by 62.6% to $97.9 million.

Operating profit of $9.8 million in the first quarter of 2021 decreased 35.1% compared to operating profit of $15.1 million in the first quarter 2020. First quarter of 2021 adjusted operating income of $10.5 million, decreased 39.0% compared to $17.2 million a year ago. Adjusted operating margin of 3.7% decreased 230 basis points from 6.0% in first quarter 2020 due to unfavorable product mix in Infrastructure Solutions and under absorption in Materials Solutions. Unfavorable product mix was driven by certain international product sales with lower than normal margins as compared to domestic sales, primarily due to logistics costs. Efforts to build our global supply chain are expected to improve the international margins as we grow this part of the business. The under absorption was primarily related to the movement of production from our Mequon site to other Astec sites. Operating expenses were relatively flat at $58.7 million on a year over year basis. A $3.6 million increase in dues and subscriptions, primarily technology related, was partially offset by a $1.9 million COVID-related reduction in travel expenses.

The income tax rate for the quarter was 9.4% and the adjusted income tax rate was 9.7%. The low income tax rate was primarily due to benefits from the booking of stock compensation and state tax deductions associated with management fee allocations.

Net income of $8.7 million decreased 57.8% compared to the prior year quarter, while diluted EPS decreased to $0.38, or 58.2%. Adjusted net income of $9.3 million decreased 57.9% compared to the prior year period, while Adjusted EPS of $0.41 decreased 57.7% compared to $0.97 for the first quarter of 2020.

Adjusted EBITDA of $18.0 million decreased 24.1% compared to $23.7 million a year ago. Adjusted EBITDA margin of 6.3% decreased 190 basis points from 8.2% in first quarter of 2020 largely driven by strategic sales, lower factory absorption and investments in technology.

“The sale of new equipment and parts were up slightly for the quarter, however those increases were offset by a year-over-year decline in used equipment sales. In the prior year, we executed our plan to reduce used inventory,” said Barry Ruffalo, CEO of Astec. “During the fourth quarter of 2020 we began the process of moving the manufacturing of our Mequon site products to other Astec sites. This temporarily impacted our ability to get some products and parts through our facilities. The decision to relocate these products is in line with our long-term strategy to Simplify, Focus and Grow the business to unlock stakeholder value.” Mr. Ruffalo went on to say, “We appear to be in the early stages of a positive economic cycle supported by investment in global infrastructure. Many of our customers have projects on their books for the rest of 2021 and some into 2022. As a result, we are pleased with the significant increase in our backlog.”

COVID-19 Continuity and Business Operations Update

Our top priority continues to be protecting our employees and their families, our customers and suppliers and our operations from any adverse impacts by taking precautionary measures as directed by health authorities and local governments. Business operations have been fully operational during the first quarter of 2021.

We continue to execute on COVID-19 measures in order to ensure the health and well-being of our employees, their families and communities in which we operate, while continuing to serve our customers’ critical needs.

Closure of Tacoma Facility – In January 2021, we announced plans to close our Tacoma facility in order to simplify and consolidate operations. We expect the Tacoma facility to cease operations in the fourth quarter of 2021. Manufacturing and marketing of Tacoma product lines are expected to be transferred to other Astec facilities in late 2021.

Highway Funding – Federal funding provides a significant portion of all highway, street, roadway and parking construction in the United States. We believe federal funding influences the purchasing decisions of our customers, who are typically more amenable to making capital equipment purchases with long-term federal legislation in place. Federal transportation funding under the Fixing America’s Surface Transportation Act (“FAST Act”), which was set to expire on September 30, 2020, was temporarily extended for one year through September 30, 2021. We believe a multi-year highway program (such as the FAST Act) will have the greatest positive impact on the road construction industry and allow our customers to plan and execute longer term projects.

Supply Chain – We have experienced only minor interruptions to our supply chain however we are not immune to supply chain disruptions caused by the recent surge in world demand. We are closely monitoring our supply chain and are ready to take proactive actions as needed to mitigate any potential disruptions. We have increased the frequency of communications with our suppliers and customers to ensure business continuity as well as anticipate and prepare for any new developments.

Steel – Steel is a major component of our equipment. Steel prices began increasing in the latter part of 2020. We have experienced further increases in steel pricing entering 2021 and anticipate continued increases throughout 2021. We continue to utilize strategies that include forward-looking contracts and advanced steel purchases to ensure supply and minimize the impact of price volatility.

“In 2020, we continued to execute our plan to transform our company despite the headwinds of the COVID-19 pandemic. Thus far in 2021, we have experienced a ramp up in demand, accompanied by commodity inflation and a tight labor market. We continued to position our business to adjust to these evolving market dynamics, while continuing to execute our transformation strategy. The effort put in by the team over the last 20 months to build a strong foundation throughout our company will pay dividends to our customers, employees and shareholders over the long run. While we are still in the early innings of our transformation, we are pleased that we drove change at a good pace in an effort to place ourselves in the best position to leverage what we earn from the market. We remain excited about our future and continue to see near-term and long-term opportunities in the Rock-to-Road value chain we serve,” said Mr. Ruffalo.

Investor Conference Call and Webcast

Astec will conduct a conference call and live webcast today, May 5, 2021, at 10:00 A.M. Eastern Time, to review its first quarter 2021 results as well as current business conditions. The number to call for this interactive teleconference is (877) 407-9210 (at least 10 minutes prior to the scheduled time for the call). International callers should dial (201) 689-8049. You may also access a live webcast of the call by visiting www.webcaster4.com/Webcast/Page/2146/40763. You will need to give your name and company affiliation and reference Astec Industries. An archived webcast will be available for 90 days at www.astecindustries.com. The supplemental presentation slides are available on the Astec Industries, Inc. website by visiting https://www.astecindustries.com/investor-relations/analyst-information/presentations.html.

A replay of the conference call will be available through May 19, 2021 by dialing (877) 481-4010 or (919) 882-2331 for international callers, Conference ID # 40763. A transcript of the conference call will be made available under the Investor Relations section of the Astec Industries, Inc. website within five business days after the call.

About Astec

Astec, (www.astecindustries.com), is a manufacturer of specialized equipment for asphalt road building, aggregate processing and concrete production. Astec’s manufacturing operations are divided into two primary business segments: Infrastructure Solutions that includes road building, asphalt and concrete plants, thermal and storage solutions; and Materials Solutions that include our aggregate processing and mining equipment.

Safe Harbor Statements under the Private Securities Litigation Reform Act of 1995

This News Release contains forward-looking statements within the meaning of the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. Such statements relate to, among other things, income, earnings, cash flows, changes in operations, operating improvements, businesses in which we operate and the United States and global economies. Statements in News Release that are not historical are hereby identified as “forward-looking statements” and may be indicated by words or phrases such as “anticipates,” “supports,” “plans,” “projects,” “expects,” “believes,” “should,” “would,” “could,” “hope,” “forecast,” “management is of the opinion,” use of the future tense and similar words or phrases. These forward-looking statements are based largely on management’s expectations, which are subject to a number of known and unknown risks, uncertainties and other factors discussed and described in our most recent Annual Report on Form 10-K, including those risks described in Part I, Item 1A. Risk Factors thereof, and in other reports filed subsequently by us with the Securities and Exchange Commission, which may cause actual results, financial or otherwise, to be materially different from those anticipated, expressed or implied by the forward-looking statements. All forward-looking statements included in this document are based on information available to us on the date hereof, and we assume no obligation to update any such forward-looking statements to reflect future events or circumstances, except as required by law.

Non-GAAP Financial Measures

In an effort to provide investors with additional information regarding the Company’s results, the Company refers to various GAAP (U.S. generally accepted accounting principles) and non-GAAP financial measures which management believes provides useful information to investors. These non-GAAP financial measures have no standardized meaning prescribed by U.S. GAAP and therefore are unlikely to be comparable to the calculation of similar measures for other companies. Management of the Company does not intend these items to be considered in isolation or as a substitute for the related GAAP measures. Nonetheless, this non-GAAP information can be useful in understanding the Company’s operating results and the performance of its core business. Management of the Company uses both GAAP and non-GAAP financial measures to establish internal budgets and targets and to evaluate the Company’s financial performance against such budgets and targets. A reconciliation of these non-GAAP measures to the most directly comparable GAAP measure is included in the appendix to this News Release.

For Additional Information Contact:

Steve Anderson
Senior Vice President of Administration and Investor Relations
Phone: (423) 899-5898
Fax: (423) 899-4456
E-mail: [email protected]

Astec Industries Inc.

Condensed Consolidated Statements of Operations

(In millions, except shares in thousands and per share amounts; unaudited)

	Three Months Ended March 31,
	2021			2020
Net sales	$	284.4		$	288.8
Cost of sales	215.9			215.4
Gross profit	68.5			73.4

Operating expenses:
Selling, general, administrative and engineering	58.0			56.2
Restructuring, impairment and other asset charges, net	0.7			2.1
Total operating expenses	58.7			58.3
Operating income	9.8			15.1

Other income:
Interest expense	(0.2		)	—
Other income, net of expenses	—			0.2
Income from operations before income taxes	9.6			15.3
Income tax provision (benefit)	0.9			(5.1		)
Net income	8.7			20.4
Net loss attributable to noncontrolling interest	—			0.2
Net income attributable to controlling interest	$	8.7		$	20.6

Earnings per common share
Basic	$	0.38		$	0.91
Diluted	0.38			0.91

Weighted average shares outstanding
Basic	22,633			22,545
Diluted	22,875			22,713

Diluted EPS	$	0.38		$	0.91
Facility closures and reduction in force	0.03			0.05
Asset impairment	—			0.07
Gain on sale of property, equipment and business, net	—			(0.03		)
Income taxes	—			(0.03		)
Adjusted EPS	$	0.41		$	0.97

Astec Industries Inc.

Segment Net Sales and Profits

(In millions; unaudited)

	Three Months Ended March 31,
	Infrastructure Solutions			Materials Solutions			Corporate			Total

2021 Net sales	$	201.5		$	82.9		$	—		$	284.4
2020 Net sales	202.6			86.2			—			288.8
Change $	(1.1		)	(3.3		)	—			(4.4		)
Change %	(0.5		)%	(3.8		)%	—		%	(1.5		)%

2021 Gross profit	48.5			20.0			—			68.5
2021 Gross profit %	24.1		%	24.1		%	—		%	24.1		%
2020 Gross profit	52.3			21.0			0.1			73.4
2020 Gross profit %	25.8		%	24.4		%	N/M			25.4		%
Change $	(3.8		)	(1.0		)	(0.1		)	(4.9		)

2021 Profit / (loss)	21.0			6.5			(18.8		)	8.7
2020 Profit / (loss)	17.2			6.0			(2.9		)	20.3
Change $	3.8			0.5			(15.9		)	(11.6		)
Change %	22.1		%	8.3		%	(548.3		)%	(57.1		)%

N/M = Not Meaningful

Segment net sales are reported net of intersegment sales. Segment gross profit is net of profit on intersegment sales. A reconciliation of total segment profits to the Company’s net income attributable to controlling interest is as follows (in millions; unaudited):

	Three Months Ended March 31,
	2021		2020		Change $
Total profit for all segments	$	8.7	$	20.3	$	(11.6	)
Recapture of intersegment profit	—		0.1		(0.1		)
Net loss attributable to noncontrolling interest	—		0.2		(0.2		)
Net income attributable to controlling interest	$	8.7	$	20.6	$	(11.9	)

Astec Industries Inc.

Condensed Consolidated Balance Sheets

(In millions; unaudited)

	March 31, 2021		December 31, 2020
Assets
Current assets:
Cash and cash equivalents	$	164.6	$	158.6
Investments	7.0		4.3
Trade receivables and contract assets, net	141.2		115.9
Inventories, net	244.2		249.7
Other current assets	35.0		37.3
Total current assets	592.0		565.8
Property, plant and equipment, net	169.6		172.8
Other long-term assets	106.7		109.6
Total assets	$	868.3	$	848.2

Liabilities
Current liabilities:
Accounts payable	$	68.1	$	52.7
Other current liabilities	117.0		117.6
Total current liabilities	185.1		170.3
Long-term debt	0.3		0.4
Other long-term liabilities	35.9		34.5
Total equity	647.0		643.0
Total liabilities and equity	$	868.3	$	848.2

Astec Industries Inc.

Condensed Consolidated Statements of Cash Flows

(In millions; unaudited)

	Three Months Ended March 31,
	2021			2020
Cash flows from operating activities:
Net income	$	8.7		$	20.4
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation	5.0			5.2
Amortization	2.6			1.1
Provision for credit losses	0.3			0.6
Provision for warranties	2.7			2.7
Deferred compensation expense (benefit)	0.7			(0.3		)
Share-based compensation	1.4			1.1
Deferred tax provision	0.8			13.5
Gain on disposition of property and equipment	(0.1		)	(0.6		)
Asset impairment charges	—			1.6
Distributions to SERP participants	(0.3		)	(0.1		)
Change in operating assets and liabilities, excluding the effects of acquisitions:
Purchase of trading securities, net	(1.4		)	(0.4		)
Receivables and other contract assets	(26.4		)	(16.6		)
Inventories	5.0			(0.3		)
Prepaid expenses	0.7			3.3
Other assets	(1.2		)	(0.8		)
Accounts payable	15.8			7.8
Accrued loss reserves	0.1			—
Accrued payroll and related expenses	2.6			(4.6		)
Other accrued liabilities	(0.3		)	(0.7		)
Accrued product warranty	(2.1		)	(2.1		)
Customer deposits	(0.9		)	(5.2		)
Income taxes payable/prepaid	0.9			(18.5		)
Other	—			(1.7		)
Net cash provided by operating activities	14.6			5.4
Cash flows from investing activities:
Acquisitions, net of cash acquired	0.1			—
Overpayment returned on prior sale of subsidiary	(1.1		)	—
Expenditures for property and equipment	(3.3		)	(5.8		)
Proceeds from sale of property and equipment	1.4			1.9
Purchase of investments, net	(0.1		)	(0.2		)
Net cash used by investing activities	(3.0		)	(4.1		)
Cash flows from financing activities:
Payment of dividends	(2.5		)	(2.5		)
Borrowings under bank loans	2.0			—
Repayment of bank loans	(2.3		)	(0.7		)
Sale of Company stock by SERP, net	0.2			—
Withholding tax paid upon vesting of share-based compensation awards	(3.0		)	(0.5		)
Net cash used by financing activities	(5.6		)	(3.7		)
Effect of exchange rates on cash	—			(2.6		)
Increase (decrease) in cash and cash equivalents	6.0			(5.0		)
Cash and cash equivalents, beginning of period	158.6			48.9
Cash and cash equivalents, end of period	$	164.6		$	43.9

Appendix

1Q 2021 GAAP to Non-GAAP Reconciliation Table
	As Reported (GAAP)			Restructuring, Impairment, and Other Charges, Net		As Adjusted (Non-GAAP)
Consolidated
Net sales	$	284.4		$	—	$	284.4
GP	68.5			—		68.5
GP%	24.1		%			24.1		%
Operating income	9.8			0.7		10.5
Income taxes	0.9			0.1		1.0
Net income attributable to controlling interest	8.7			0.6		9.3
Diluted EPS	0.38			0.03		0.41

Infrastructure Solutions
Net sales	201.5			—		201.5
GP	48.5			—		48.5
GP%	24.1		%			24.1		%

Materials Solutions
Net sales	82.9			—		82.9
GP	20.0			—		20.0
GP%	24.1		%			24.1		%

1Q 2020 GAAP to Non-GAAP Reconciliation Table
	As Reported (GAAP)			Restructuring, Impairment, and Other Charges, Net		As Adjusted (Non-GAAP)
Consolidated
Net sales	$	288.8		$	—	$	288.8
GP	73.4			—		73.4
GP%	25.4		%			25.4		%
Operating income	15.1			2.1		17.2
Income taxes	-5.1			0.6		-4.5
Net income attributable to controlling interest	20.6			1.5		22.1
Diluted EPS	0.91			0.06		0.97

Infrastructure Solutions
Net sales	202.6			—		202.6
GP	52.3			—		52.3
GP%	25.8		%			25.8		%

Materials Solutions
Net sales	86.2			—		86.2
GP	21.0			—		21.0
GP%	24.4		%			24.4		%

Astec Industries Inc.

GAAP vs Non-GAAP Adjusted EPS Reconciliations

(In millions, except per share amounts; unaudited)

	Three Months Ended March 31,
	2021			2020
Net income attributable to controlling interest	$	8.7		$	20.6
Adjustments:
Facility closures and reduction in force	0.8			1.1
Asset impairment	—			1.6
Gain on sale of property, equipment and business, net	(0.1		)	(0.6		)
Income taxes	(0.1		)	(0.6		)
Adjusted net income attributable to controlling interest	$	9.3		$	22.1

Diluted EPS	$	0.38		$	0.91
Adjustments:
Facility closures and reduction in force	0.03			0.05
Asset impairment	—			0.07
Gain on sale of property, equipment and business, net	—			(0.03		)
Income taxes	—			(0.03		)
Adjusted EPS	$	0.41		$	0.97

Astec Industries Inc.

EBITDA and Adjusted EBITDA Reconciliations

(In millions; unaudited)

	Three Months Ended March 31,
	2021			2020
Net sales	$	284.4		$	288.8

Net income attributable to controlling interest	$	8.7		$	20.6
Interest expense (income), net	0.1			(0.2		)
Depreciation and amortization	7.6			6.3
Provision (benefit) from income taxes	0.9			(5.1		)
EBITDA	17.3			21.6
EBITDA margin	6.1		%	7.5		%

Adjustments:
Facility closures and reduction in force	0.8			1.1
Asset impairment	—			1.6
Gain on sale of property, equipment and business, net	(0.1		)	(0.6		)
Adjusted EBITDA	$	18.0		$	23.7
Adjusted EBITDA margin	6.3		%	8.2		%

May 5, 2021 7:04 am

CDW Reports First Quarter 2021 Earnings

CDW Reports First Quarter 2021 Earnings

Reinforces Power of Business Model and Strategy

LINCOLNSHIRE, Ill.–(BUSINESS WIRE)–
CDW Corporation (Nasdaq:CDW):

(Dollars in millions, except per share amounts)	Three Months Ended March 31, 2021		Three Months Ended March 31, 2020		% Chg.
Net Sales	$	4,837.5	$	4,389.2	10.2
Average Daily Sales¹	76.8		68.6		12.0
Gross Profit	795.2		756.5		5.1
Operating Income	323.4		245.8		31.6
Net Income	232.6		167.9		38.6
Non-GAAP Operating Income²	367.7		303.9		21.0
Net Income per Diluted Share	$	1.63	$	1.16	40.3
Non-GAAP Net Income per Diluted Share²	$	1.74	$	1.38	26.2
¹There were 63 and 64 selling days for the three months ended March 31, 2021 and 2020, respectively.
²Non-GAAP measures used in this release that are not based on accounting principles generally accepted in the United States of America (“US GAAP”) are each defined and reconciled to the most directly comparable US GAAP measure in the attached schedules.

CDW Corporation (Nasdaq: CDW), a leading multi-brand provider of information technology solutions to business, government, education and healthcare customers in the United States, the United Kingdom and Canada, today announced first quarter 2021 results. CDW also announced the approval by its Board of Directors of a quarterly cash dividend of $0.40 to be paid on June 10, 2021 to all stockholders of record as of the close of business on May 25, 2021.

“The diversity of our customer end markets and our solutions portfolio drove our record first quarter results, and reinforced confidence in our strategy. During the quarter, customers focused on remote enablement and investments for the future. Technology spend rebounded in our channels most impacted last year due to the COVID-19 pandemic,” said Christine A. Leahy, president and chief executive officer, CDW. “I am extremely proud of the commitment, agility and resolve of our coworkers, who continued to successfully deliver customer outcomes and capabilities across the full technology solutions stack and lifecycle.”

“Strong operating results were amplified by share repurchases, delivering a 26 percent increase in Non-GAAP net income per diluted share,” said Collin B. Kebo, chief financial officer, CDW. “Given this quarter’s results and our expectations for the balance of the year, we now expect 2021 constant currency Non-GAAP net income per diluted share growth of low double-digits.”

“We expect to exceed our previous 2021 outlook of outpacing the US IT market growth by 200 to 300 basis points on a constant currency basis. We will continue to execute our strategy, invest in the business, and be laser-focused on meeting the needs of our more than 250,000 customers in the United States, the United Kingdom and Canada and remaining the partner of choice for more than 1,000 leading and emerging technology brands as the technology market continues to evolve,” concluded Leahy.

First Quarter of 2021 Highlights:

Total Net sales in the first quarter of 2021 were $4,838 million, compared to $4,389 million in the first quarter of 2020, an increase of 10.2 percent. There were 63 and 64 selling days for the three months ended March 31, 2021 and 2020, respectively. On an average daily sales basis, Net sales growth increased 12.0 percent and Net sales growth on a constant currency basis increased 10.9 percent. Currency impact to Net sales growth was driven by favorable translation of the British pound and Canadian dollar to US dollar. First quarter Net sales performance, on an average daily sales basis, included:

Total Corporate segment Net sales of $1,806 million, 4.0 percent lower than 2020.
Total Small Business segment Net sales of $433 million, 12.3 percent higher than 2020.
Total Public segment Net sales of $1,922 million, 28.0 percent higher than 2020. Public results were driven by an increase in Net sales to Education customers of 101.2 percent. Net sales to Government and Healthcare customers decreased 7.8 percent and 2.3 percent, respectively.
Net sales for CDW’s UK and Canadian operations, combined as “Other” for financial reporting purposes, were $678 million, 22.6 percent higher than 2020.

Gross profit in the first quarter of 2021 was $795 million, compared to $757 million for the first quarter of 2020, representing an increase of 5.1 percent. Gross profit margin was 16.4 percent in the first quarter of 2021 versus 17.2 percent in the first quarter of 2020. The decrease in Gross profit margin was primarily driven by lower product margin, including notebook mix and rate, and overlapping higher margin configuration services in the prior year, partially offset by an increase in the mix of netted down revenues, primarily Software as a Service.

Total selling and administrative expenses were $472 million in the first quarter of 2021, compared to $511 million in the first quarter of 2020, representing a decrease of 7.6 percent. The decrease was primarily due to lower bad debt expense, lower intangible asset amortization and lower travel and entertainment expenses, partially offset by higher investments in coworkers.

Operating income was $323 million in the first quarter of 2021, compared to $246 million in the first quarter of 2020, representing an increase of 31.6 percent. Non-GAAP operating income was $368 million in the first quarter of 2021, compared to $304 million in the first quarter of 2020, representing an increase of 21.0 percent. The Non-GAAP operating income margin was 7.6 percent for the first quarter of 2021 versus 6.9 percent for the first quarter of 2020.

Net interest expense was $36 million in the first quarter of 2021 compared to $38 million in the first quarter of 2020, representing a decrease of 6.1 percent. The decrease was primarily driven by a lower effective interest rate on the Term Loan in 2021 compared to 2020 and the benefits from the August 2020 senior notes refinancing, partially offset by additional interest expense on the senior notes issued in April 2020.

The effective tax rate was 19.5 percent in the first quarter of 2021 compared to 20.7 percent in the first quarter 2020, which resulted in tax expense of $56 million and $44 million, respectively.

Net income was $233 million in the first quarter of 2021, compared to $168 million in the first quarter of 2020, representing an increase of 38.6 percent. Non-GAAP net income was $249 million in the first quarter of 2021, compared to $200 million in the first quarter of 2020, representing an increase of 24.7 percent.

Weighted average diluted shares outstanding were 143 million for the first quarter of 2021, compared to 145 million for the first quarter of 2020. Net income per diluted share for the first quarter of 2021 was $1.63, compared to $1.16 for the first quarter of 2020, representing an increase of 40.3 percent. Non-GAAP net income per diluted share for the first quarter of 2021 was $1.74, compared to $1.38 for the first quarter of 2020, representing an increase of 26.2 percent.

Forward-Looking Statements

This release contains “forward-looking statements” within the meaning of the federal securities laws. All statements other than statements of historical fact are forward-looking statements. These statements relate to analyses and other information, which are based on forecasts of future results or events and estimates of amounts not yet determinable. These statements also relate to our future prospects, developments and business strategies. We claim the protection of The Private Securities Litigation Reform Act of 1995 for all forward-looking statements in this release.

These forward-looking statements are identified by the use of terms and phrases such as “anticipate,” “assume,” “believe,” “estimate,” “expect,” “goal,” “intend,” “plan,” “potential,” “predict,” “project,” “target” and similar terms and phrases or future or conditional verbs such as “could,” “may,” “should,” “will,” and “would.” However, these words are not the exclusive means of identifying such statements. Although we believe that our plans, intentions and other expectations reflected in or suggested by such forward-looking statements are reasonable, we cannot assure you that we will achieve those plans, intentions or expectations. All forward-looking statements are subject to risks and uncertainties that may cause actual results or events to differ materially from those that we expected.

Important factors that could cause actual results or events to differ materially from our expectations, or cautionary statements, are disclosed under the section entitled “Risk Factors” included in our Annual Report on Form 10-K for the year ended December 31, 2020 and from time to time in our subsequent Quarterly Reports on Form 10-Q and our other US Securities and Exchange Commission (“SEC”) filings. These factors include, among others, the COVID-19 pandemic and actions taken in response thereto and the associated impact on our business, results of operations, cash flows, financial condition and liquidity; CDW’s relationships with vendor partners and terms of their agreements; continued innovations in hardware, software and services offerings by CDW’s vendor partners; substantial competition that could reduce CDW’s market share; the continuing development, maintenance and operation of CDW’s information technology systems; potential breaches of data security and failure to protect our information technology systems from cybersecurity threats; potential failures to provide high-quality services to CDW’s customers; potential losses of any key personnel; potential adverse occurrences at one of CDW’s primary facilities or customer data centers; increases in the cost of commercial delivery services or disruptions of those services; CDW’s exposure to accounts receivable and inventory risks; future acquisitions or alliances; fluctuations in CDW’s operating results; fluctuations in foreign currency; global and regional economic and political conditions; potential interruptions of the flow of products from suppliers; decreases in spending on technology products and services; potential failures to comply with Public segment contracts or applicable laws and regulations; current and future legal proceedings and audits; changes in laws, including regulations or interpretations thereof; CDW’s level of indebtedness and ability to generate sufficient cash to service such indebtedness; restrictions imposed by agreements relating to CDW’s indebtedness on its operations and liquidity; changes in, or the discontinuation of, CDW’s share repurchase program or dividend payments; and other risk factors or uncertainties identified from time to time in CDW’s filings with the SEC. All written and oral forward-looking statements attributable to us, or persons acting on our behalf, are expressly qualified in their entirety by the cautionary statements contained in the section entitled “Risk Factors” and elsewhere in our Annual Report on Form 10-K for the year ended December 31, 2020 as well as other cautionary statements that are made from time to time in our other SEC filings and public communications. You should evaluate all forward-looking statements made in this release in the context of these risks and uncertainties.

We caution you that the important factors referenced above may not reflect all of the factors that could cause actual results or events to differ from our expectations. In addition, we cannot assure you that we will realize the results or developments we expect or anticipate or, even if substantially realized, that they will result in the consequences or affect us or our operations in the way we expect. The forward-looking statements included in this release are made only as of the date hereof. We undertake no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or otherwise, except as otherwise required by law.

Non-GAAP Financial Information

Non-GAAP operating income excludes, among other things, charges related to the amortization of acquisition-related intangible assets, equity-based compensation and related payroll taxes, and acquisition and integration expenses. Non-GAAP operating income margin is defined as Non-GAAP operating income as a percentage of Net sales. Non-GAAP income before income taxes and Non-GAAP net income exclude, among other things, charges related to acquisition-related intangible asset amortization, equity-based compensation, acquisition and integration expenses, and the associated tax effects of each. Net sales growth on a constant currency basis is defined as Net sales growth excluding the impact of foreign currency translation on Net sales compared to the prior period.

Non-GAAP operating income, Non-GAAP operating income margin, Non-GAAP income before income taxes, Non-GAAP net income, Non-GAAP net income per diluted share and Net sales growth on a constant currency basis are considered non-GAAP financial measures. Generally, a non-GAAP financial measure is a numerical measure of a company’s performance or financial position that either excludes or includes amounts that are not normally included or excluded in the most directly comparable measure calculated and presented in accordance with US GAAP.

CDW believes these measures provide analysts, investors and management with helpful information regarding the underlying operating performance of CDW’s business, as they remove the impact of items that management believes are not reflective of underlying operating performance. CDW uses these measures to evaluate period-over-period performance as management believes they provide a more comparable measure of the underlying business.

Our annual targets are provided on a Non-GAAP basis because certain reconciling items are dependent on future events that either cannot be controlled, such as currency impacts or interest rates, or reliably predicted because they are not part of CDW’s routine activities, such as refinancing activities or acquisition and integration expenses.

The financial statement tables that accompany this press release include a reconciliation of non-GAAP financial measures to the applicable most comparable US GAAP financial measures. Non-GAAP measures used by CDW may differ from similar measures used by other companies, even when similar terms are used to identify such measures.

About CDW

CDW Corporation (Nasdaq: CDW) is a leading multi-brand provider of information technology solutions to business, government, education and healthcare customers in the United States, the United Kingdom and Canada. A Fortune 500 company and member of the S&P 500 Index, CDW was founded in 1984 and employs over 10,000 coworkers. For the trailing twelve months ended March 31, 2021, CDW generated Net sales of approximately $19 billion. For more information about CDW, please visit www.CDW.com.

Webcast

CDW Corporation will hold a conference call today, May 5, 2021 at 7:30 a.m. CT/8:30 a.m. ET to discuss its first quarter financial results. The conference call, which will be broadcast live via the Internet, and a copy of this press release along with supplemental slides used during the call, can be accessed on CDW’s website at investor.cdw.com. For those unable to participate in the live call, a replay of the webcast will be available at investor.cdw.com approximately 90 minutes after the completion of the call and will be accessible on the site for approximately one year.

CDWPR-FI

CDW CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (dollars and shares in millions, except per-share amounts) (unaudited)

	Three Months Ended March 31,
	2021			2020			% Change⁽ⁱ⁾

Net sales	$	4,837.5		$	4,389.2		10.2	%
Cost of sales	4,042.3			3,632.7			11.3

Gross profit	795.2			756.5			5.1

Selling and administrative expenses	471.8			510.7			(7.6	)
Operating income	323.4			245.8			31.6

Interest expense, net	(35.6		)	(37.9		)	(6.1	)
Other income, net	1.1			3.9			(74.0	)

Income before income taxes	288.9			211.8			36.4

Income tax expense	(56.3		)	(43.9		)	28.0

Net income	$	232.6		$	167.9		38.6	%

Net income per common share:
Basic	$	1.65		$	1.18		40.1	%
Diluted	$	1.63		$	1.16		40.3	%

Weighted-average common shares outstanding:
Basic	141.1			142.7
Diluted	143.1			144.9

(i)	There were 63 and 64 selling days for the three months ended March 31, 2021 and 2020, respectively.

CDW CORPORATION AND SUBSIDIARIES

NON-GAAP FINANCIAL MEASURE RECONCILIATIONS

CDW has included reconciliations of Non-GAAP operating income, Non-GAAP operating income margin, Non-GAAP income before income taxes, Non-GAAP net income, Non-GAAP net income per diluted share and Net sales growth on a constant currency basis for the three months ended March 31, 2021 and 2020 below.

CDW CORPORATION AND SUBSIDIARIES NON-GAAP OPERATING INCOME AND NON-GAAP OPERATING INCOME MARGIN (dollars in millions) (unaudited)

	Three Months Ended March 31,
	2021		% of Net sales		2020		% of Net sales

Operating income, as reported	$	323.4	6.7	%	$	245.8	5.6	%
Amortization of intangibles⁽ⁱ⁾	21.6				44.6
Equity-based compensation	15.8				8.8
Other adjustments⁽ⁱⁱ⁾	6.9				4.7
Non-GAAP operating income	$	367.7	7.6	%	$	303.9	6.9	%

(i)	Includes amortization expense for acquisition-related intangible assets, primarily customer relationships, customer contracts and trade names.
(ii)	Includes other expenses such as acquisition and integration expenses, payroll taxes on equity-based compensation and expenses related to the relocation of the downtown Chicago office.

CDW CORPORATION AND SUBSIDIARIES NON-GAAP INCOME BEFORE INCOME TAXES, NON-GAAP NET INCOME AND NON-GAAP NET INCOME PER DILUTED SHARE (dollars and shares in millions, except per-share amounts) (unaudited)

	Three Months Ended March 31,
	2021										2020
	Income before Income Taxes		Income Tax Expense⁽ⁱ⁾			Net Income			Effective Tax Rate		Income before Income Taxes		Income Tax Expense⁽ⁱ⁾			Net Income			Effective Tax Rate		Net Income % Change

US GAAP, as reported	$	288.9	$	(56.3	)	$	232.6		19.5	%	$	211.8	$	(43.9	)	$	167.9		20.7	%	38.6	%
Amortization of intangibles⁽ⁱⁱ⁾	21.6		(5.4		)	16.2					44.6		(11.1		)	33.5
Equity-based compensation	15.8		(20.8		)	(5.0		)			8.8		(13.7		)	(4.9		)
Other adjustments⁽ⁱⁱⁱ⁾	7.3		(1.7		)	5.6					4.7		(1.2		)	3.5
Non-GAAP	$	333.6	$	(84.2	)	$	249.4		25.2	%	$	269.9	$	(69.9	)	$	200.0		25.9	%	24.7	%

US GAAP net income per diluted share						$	1.63									$	1.16
Non-GAAP net income per diluted share						$	1.74									$	1.38
Shares used in computing US GAAP and Non-GAAP net income per diluted share						143.1										144.9

(i)	Income tax on non-GAAP adjustments includes excess tax benefits associated with equity-based compensation.
(ii)	Includes amortization expense for acquisition-related intangible assets, primarily customer relationships, customer contracts and trade names.
(iii)	Includes other expenses such as acquisition and integration expenses, payroll taxes on equity-based compensation, expenses related to the relocation of the downtown Chicago office and a net loss on extinguishment of long-term debt.

CDW CORPORATION AND SUBSIDIARIES NET SALES GROWTH ON A CONSTANT CURRENCY BASIS (dollars in millions) (unaudited)

	Three Months Ended March 31,
	2021		2020		% Change		Average Daily % Change⁽ⁱ⁾
Net sales, as reported	$	4,837.5	$	4,389.2	10.2	%	12.0	%
Foreign currency translation⁽ⁱⁱ⁾	—		42.2
Net sales, on a constant currency basis	$	4,837.5	$	4,431.4	9.2	%	10.9	%

(i)	There were 63 and 64 selling days for the three months ended March 31, 2021 and 2020, respectively.
(ii)	Represents the effect of translating the prior year results of CDW UK and CDW Canada at the average exchange rates applicable in the current year.

CDW CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (dollars in millions)

	March 31, 2021		December 31, 2020		March 31, 2020
Assets	(unaudited)				(unaudited)

Current assets:
Cash and cash equivalents	$	878.6	$	1,410.2	$	214.4
Accounts receivable, net of allowance for credit losses of $27.0, $29.6, and $35.1 respectively	3,234.1		3,212.6		3,149.4
Merchandise inventory	745.1		760.0		672.1
Miscellaneous receivables	396.6		379.5		442.5
Prepaid expenses and other	215.4		191.2		187.4
Total current assets	5,469.8		5,953.5		4,665.8

Operating lease right-of-use assets	128.3		130.8		129.5
Property and equipment, net	175.5		175.5		331.9
Goodwill	2,812.4		2,595.9		2,529.5
Other intangible assets, net	419.2		445.1		540.2
Other assets	48.3		43.9		25.5
Total assets	$	9,053.5	$	9,344.7	$	8,222.4

Liabilities and Stockholders’ Equity

Current liabilities:
Accounts payable – trade	$	2,050.8	$	2,088.4	$	1,967.1
Accounts payable – inventory financing	344.8		524.6		345.5
Current maturities of long-term debt	19.6		70.9		33.7
Contract liabilities	326.5		243.7		257.6
Accrued expenses and other current liabilities	967.6		970.7		1,043.3
Total current liabilities	3,709.3		3,898.3		3,647.2

Long-term liabilities:
Debt	3,911.1		3,856.3		3,438.5
Deferred income taxes	29.2		55.3		62.8
Operating lease liabilities	165.1		169.0		129.2
Other liabilities	68.5		68.7		55.0
Total long-term liabilities	4,173.9		4,149.3		3,685.5

Total stockholders’ equity	1,170.3		1,297.1		889.7
Total liabilities and stockholders’ equity	$	9,053.5	$	9,344.7	$	8,222.4

CDW CORPORATION AND SUBSIDIARIES NET SALES DETAIL (dollars in millions) (unaudited)

	Three Months Ended March 31,
	2021		2020		% Change		Average Daily % Change⁽ⁱ⁾

Corporate	$	1,805.6	$	1,911.0	(5.5	)%	(4.0	)%

Small Business	432.7		391.5		10.5		12.3

Public
Government	516.1		568.5		(9.2	)	(7.8	)
Education	943.3		476.2		98.1		101.2
Healthcare	462.3		480.6		(3.8	)	(2.3	)
Total Public	1,921.7		1,525.3		26.0		28.0

Other	677.5		561.4		20.7		22.6

Total Net sales	$	4,837.5	$	4,389.2	10.2	%	12.0	%

(i)	There were 63 and 64 selling days for the three months ended March 31, 2021 and 2020, respectively.

CDW CORPORATION AND SUBSIDIARIES DEBT AND WORKING CAPITAL INFORMATION (dollars in millions)

	March 31, 2021			December 31, 2020			March 31, 2020
	(unaudited)						(unaudited)
Debt and Revolver Availability
Cash and cash equivalents	$	878.6		$	1,410.2		$	214.4
Total debt	3,930.7			3,927.2			3,472.2
Revolver availability	1,260.0			1,059.3			998.6
Cash plus revolver availability	2,138.6			2,469.5			1,213.0

Working Capital⁽ⁱ⁾
Days of sales outstanding	57			57			58
Days of supply in inventory	16			14			14
Days of purchases outstanding	(51		)	(54		)	(52		)
Cash conversion cycle	22			17			20

(i)	Based on a rolling three-month average.

CDW CORPORATION AND SUBSIDIARIES CASH FLOW INFORMATION (dollars in millions) (unaudited)

	Three Months Ended March 31,
	2021			2020

Cash flows provided by operating activities	$	344.6		$	223.0

Capital expenditures⁽ⁱ⁾	(20.7		)	(25.4		)
Acquisition of business, net of cash acquired	(212.9		)	—
Cash flows used in investing activities	(233.6		)	(25.4		)

Net change in accounts payable – inventory financing	(180.3		)	(81.4		)
Financing payments for revenue generating assets	(42.9		)	—
Other cash flows used in financing activities	(420.3		)	(48.6		)
Cash flows used in financing activities	(643.5		)	(130.0		)

Effect of exchange rate changes on cash and cash equivalents	0.9			(7.2		)
Net (decrease) increase in cash and cash equivalents	(531.6		)	60.4
Cash and cash equivalents – beginning of period	1,410.2			154.0
Cash and cash equivalents – end of period	$	878.6		$	214.4

Supplementary disclosure of cash flow information:
Interest paid	$	(19.2	)	$	(28.6	)
Income taxes paid, net	$	(10.1	)	$	(9.9	)

(i)	Includes expenditures for revenue generating assets.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210505005137/en/

Investor Inquiries

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INDUSTRY KEYWORDS: Software Technology Hardware Data Management

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May 5, 2021 7:04 am

Qatar Airways Privilege Club expands partnership with Points to introduce Hotel & Car Rewards

Qatar Airways Privilege Club members can now earn or spend their Qmiles when using the new booking portal

TORONTO, May 05, 2021 (GLOBE NEWSWIRE) — Global leader in powering loyalty commerce, Points (TSX: PTS) (Nasdaq: PCOM) and Qatar Airways announced a new enhancement to the Qatar Privilege Club today. The latest member benefit to be implemented by the Toronto-based company that provides best-in-class solutions to the world’s largest loyalty programs, will offer Qatar Airways Privilege Club members even more value and flexibility as they make future travel plans.

The implementation of Hotel & Car Rewards, a first for the Qatar Airways Privilege Club, offers even more flexibility. Fully customizable, the holistic travel solution powered by Points, provides members with access to up to 350,000 hotels and over 20,000 car rental locations worldwide. With Hotel & Car Rewards, members earn Qmiles at a competitive rate on every cash travel booking they make. They also have the option to spend their Qmiles at no additional cost or make split payments with cash and Qmiles for their hotel or car rental bookings.

Qatar Airways Group Chief Executive, His Excellency Mr. Akbar Al Baker said: “At Qatar Airways, we are continually striving to enhance Privilege Club and offer our members more value and opportunities to earn and spend Qmiles. We also want to make the experience of earning and spending Qmiles as seamless as when our loyalty members travel with us across the globe. Hotel & Car Rewards provides our members’ convenient ways to spend for hotel stays and car rentals using Qmiles or use a combination of Qmiles with Cash. Hotel & Car Rewards is another example of Privilege Club’s commitment to redefining and enhancing the experience for our loyalty members.”

Rob MacLean, CEO of Points, also welcomed the news, “We are pleased to be expanding our partnership with Qatar Airways Privilege Club since implementing our first product integration just under a year ago and to be providing them with more ways than ever to connect with their members. Our research has shown us that enthusiasm for travel planning has not diminished over the past year. The recently improved Buy, Gift and Transfer offering and now Hotel & Car Rewards, will offer members additional value and convenience as they make their future travel plans for this year and beyond with Qatar Airways.”

Points began a multi-year partnership with Qatar Airways last August with the introduction of the option for members to Buy, Gift or Transfer their Qmiles; further product implementations are planned for the future.

For more information on how Points can help loyalty programs unlock their full potential, visit Points.com.

About Points International

Points
, (TSX: PTS) (NASDAQ: PCOM) is a trusted partner to the world’s leading loyalty programs, leveraging its unique Loyalty Commerce Platform to build, power, and grow a network of ways members can get and use their favourite loyalty currency. Our platform combines insights, technology, and resources to make the movement of loyalty currency simpler and more intelligent for nearly 60 reward programs worldwide. Founded in 2000, Points is headquartered in Toronto with teams operating around the globe.

For more information, visit Points.com.

POINTS CONTACT

Points Media Relations

Rachel Goldrick

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May 5, 2021 7:03 am

Kamada to Announce First Quarter Ended March 31, 2021 Financial Results and Host Conference Call on May 12, 2021

REHOVOT, Israel, May 05, 2021 (GLOBE NEWSWIRE) — Kamada Ltd. (NASDAQ & TASE: KMDA), a plasma-derived biopharmaceutical company, today announced that it will release financial results for the first quarter ended March 31, 2021, prior to the open of the U.S. financial markets on Wednesday, May 12, 2021.

Kamada management will host an investment community conference call on Wednesday, May 12, at 8:30am Eastern Time to discuss these results and answer questions. Shareholders and other interested parties may participate in the conference call by dialing 877-407-0792 (from within the U.S.), or 201-689-8263 (International) and entering the conference identification number: 13719388. The call will also be webcast live on the Internet on the Company’s website at www.kamada.com.

The call will also be archived for 90 days on the Company’s website at www.kamada.com.

About Kamada

Kamada Ltd. (the “Company”) is a global specialty plasma-derived biopharmaceutical company with a diverse portfolio of marketed products, a robust development pipeline and industry-leading manufacturing capabilities. The Company’s strategy is focused on driving profitable growth from its current commercial products, its plasma-derived development pipeline and its manufacturing expertise, while evolving into a vertically integrated plasma-derived company. The Company’s two leading commercial products are GLASSIA® and KEDRRAB®. GLASSIA was the first liquid, ready-to-use, intravenous plasma-derived AAT product approved by the FDA. The Company markets GLASSIA in the U.S. through a strategic partnership with Takeda Pharmaceuticals Company Limited (“Takeda”) and in other countries through local distributors. Pursuant to an agreement with Takeda, the Company will continue to produce GLASSIA for Takeda through 2021 and Takeda will initiate its own production of GLASSIA for the U.S. market in 2021, at which point Takeda will commence payment of royalties to the Company until 2040. KEDRAB is an FDA approved anti-rabies immune globulin (Human) for post-exposure prophylaxis treatment. KEDRAB is being marketed in the U.S. through a strategic partnership with Kedrion S.p.A. The Company has additional four plasma-derived products administered by injection or infusion, that are marketed through distributors in more than 15 countries, including Israel, Russia, Brazil, Argentina, India and other countries in Latin America and Asia. The Company has two leading development programs; a plasma-derived hyperimmune immunoglobulin (IgG) product as a potential treatment for coronavirus disease (COVID-19) and an inhaled AAT for the treatment of AAT deficiency for which the Company is currently conducting the InnovAATe clinical trial, a randomized, double-blind, placebo-controlled, pivotal Phase 3 trial. The Company leverages its expertise and presence in the Israeli pharmaceutical market to distribute in Israel more than 20 products that are manufactured by third parties and have recently added nine biosimilar products to its Israeli distribution portfolio, which, subject to EMA and the Israeli MOH approvals, are expected to be launched in Israel between the years 2022 and 2025. FIMI Opportunity Fund, the leading private equity investor in Israel, is the Company’s lead shareholder, beneficially owning approximately 21% of the outstanding ordinary shares.

CONTACTS:

Chaime Orlev
Chief Financial Officer
[email protected]

Bob Yedid
LifeSci Advisors, LLC
646-597-6989
[email protected]