Le Lézard
Classified in: Science and technology, Business, Covid-19 virus
Subjects: EARNINGS, Conference Call, Webcast

Model N Announces Third Quarter Fiscal Year 2022 Financial Results


Model N, Inc. (NYSE: MODN), the leader in cloud revenue management solutions, today announced financial results for the third quarter of fiscal year 2022 ended June 30, 2022.

"We continued our strong momentum in Q3, posting another quarter of very strong bookings and exceeded all guidance metrics. During the quarter, we closed three large SaaS transitions and continued to see strong contribution from subscription bookings across our portfolio. We eclipsed the $100 million SaaS ARR milestone during the quarter and our SaaS ARR growth accelerated to 24% year-over-year," said Jason Blessing, president and chief executive officer of Model N. "2022 is truly a pivotal year for Model N as we are successfully transitioning our customers to our SaaS platform. Looking ahead, we remain laser focused on driving profitable growth and completing Model N's transformation to a cloud company."

Recent Highlights

Third Quarter 2022 Financial Highlights

A reconciliation of GAAP to non-GAAP financial measures has been provided in the financial tables included in this press release.

Guidance

As of August 9, 2022, we are providing guidance for the fourth quarter fiscal year 2022 and issuing guidance for the full fiscal year ending September 30, 2022.

(in $ millions, except per share)

Fourth Quarter Fiscal 2022

Full Year Fiscal 2022

Total revenues

56.0 - 56.5

217.0 - 217.5

Subscription revenues

41.5 - 42.0

158.4 - 158.9

Non-GAAP income from operations

7.7 - 8.2

30.9 - 31.4

Non-GAAP net income per share

0.18 - 0.20

0.70 - 0.72

Adjusted EBITDA

8.0 - 8.5

31.9 - 32.4

Quarterly Results Conference Call

Model N will host a conference call today at 2:00 PM Pacific Time (5:00 PM Eastern Time) to review the company's financial results for the third quarter fiscal year 2022 ended June 30, 2022. The conference call can be accessed by dialing 877-407-4018 from the United States or +1-201-689-8471 internationally with reference to the company name and conference title, and a live webcast and replay of the conference call can be accessed from the investor relations page of Model N's website at investor.modeln.com. Following the completion of the call through 11:59 p.m. ET on August 23, 2022, a telephone replay will be available by dialing 844-512-2921 from the United States or +1-412-317-6671, internationally, with recording access code 13725726.

About Model N

Model N enables life sciences and high tech companies to drive growth and market share, minimizing revenue leakage throughout the revenue lifecycle. With deep industry expertise and solutions purpose-built for these industries, Model N delivers comprehensive visibility, insight and control over the complexities of commercial operations and compliance. Its integrated cloud solution is proven to automate pricing, incentive and contract decisions to scale business profitably and grow revenue. Model N is trusted across more than 120 countries by the world's leading pharmaceutical, medical technology, semiconductor, and high tech companies, including Johnson & Johnson, AstraZeneca, Stryker, Seagate Technology, Broadcom and Microchip Technology. For more information, visit www.modeln.com.

Forward-Looking Statements

This press release contains forward-looking statements including, among other things, statements regarding Model N's fourth quarter and full year fiscal 2022 financial results, Model N's profitability, future planned enhancements to our products and benefits from our products, and expected benefits from our acquisition. The words "believe," "may," "will," "estimate," "continue," "anticipate," "intend," "expect," and similar expressions are intended to identify forward-looking statements. These forward-looking statements are subject to risks, uncertainties, and assumptions. If the risks materialize or assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. Risks include, but are not limited to: (i) delays in closing customer contracts; (ii) our ability to improve and sustain our sales execution; (iii) the timing of new orders and the associated revenue recognition; (iv) adverse changes in general economic or market conditions; (v) delays or reductions in information technology spending and resulting variability in customer orders from quarter to quarter; (vi) competitive factors, including but not limited to pricing pressures, industry consolidation, entry of new competitors and new applications and marketing initiatives by our competitors; (vii) our ability to manage our growth effectively; (viii) acceptance of our applications and services by customers; (ix) success of new products; (x) the risk that the strategic initiatives that we may pursue will not result in significant future revenues; (xi) changes in health care regulation and policy and tax in the United States and worldwide; (xii) our ability to retain customers; (xiii) adverse impacts on our business and financial condition due to COVID-19 or the war in Ukraine; and (xiv) the possibility that the expected benefits related to our acquisition may not materialize as expected and our ability to successfully integrate Deloitte's life sciences pricing and contracting solutions business and underlying technology. Further information on risks that could affect Model N's results is included in our filings with the Securities and Exchange Commission ("SEC"), including our most recent quarterly report on Form 10-Q and our annual report on Form 10-K for the fiscal year ended September 30, 2021, and any current reports on Form 8-K that we may file from time to time. Should any of these risks or uncertainties materialize, actual results could differ materially from expectations. Model N assumes no obligation to, and does not currently intend to, update any such forward-looking statements after the date of this release.

Non-GAAP Financial Measures

We have provided in this release financial information that has not been prepared in accordance with accounting standards generally accepted in the United States of America ("GAAP"). We use these non-GAAP financial measures internally in analyzing our financial results and believe they are useful to investors, as a supplement to GAAP measures, in evaluating our ongoing operational performance. We believe that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends, and in comparing our financial results with other companies in our industry, many of which present similar non-GAAP financial measures to investors.

Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Investors are encouraged to review the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures below. A reconciliation of our non-GAAP financial measures to their most directly comparable GAAP measures has been provided in the financial statement tables included below in this press release.

Our reported results include certain non-GAAP financial measures, including non-GAAP gross profit, non-GAAP gross margin, non-GAAP subscription gross profit, non-GAAP subscription gross margin, non-GAAP income from operations, non-GAAP net income, non-GAAP net income per share, and adjusted EBITDA. Non-GAAP gross profit excludes stock-based compensation expenses and amortization of intangible assets as they are often excluded by other companies to help investors understand the operational performance of their business. Non-GAAP income from operations excludes stock-based compensation expense, amortization of intangible assets and acquisition-related expense. Non-GAAP net income excludes stock-based compensation expense, amortization of intangible assets, acquisition-related expense and amortization of debt discount and issuance costs. Additionally, stock-based compensation expense varies from period to period and from company to company due to such things as valuation methodologies and changes in stock price. Adjusted EBITDA is defined as net loss, adjusted for depreciation and amortization, stock-based compensation expense, acquisition-related expense, interest expense, net, other (income) expenses, net, and provision for income taxes. Reconciliation tables are provided in this press release.

SaaS ARR is defined as the annualized value of our SaaS revenue, which is derived by taking the SaaS portion of our recurring subscription revenue for the quarter, dividing it by the number of days in the quarter, and multiplying it by 365 to get an annualized number. SaaS Net Dollar Retention uses the same SaaS ARR calculations to measure the percentage change in SaaS ARR from customers that are in both the current period and the year-ago period. SaaS ARR that has been added from new customers that were not in the year-ago calculation is excluded from the SaaS Net Dollar Retention calculation. SaaS ARR and SaaS Net Dollar Retention should be viewed independently of revenue, deferred revenue, and remaining performance obligations, and are not intended to be a substitute for, or combined with, any of these items.

We have not reconciled guidance for non-GAAP financial measures to their most directly comparable GAAP measures because certain items that impact these measures are uncertain, out of our control and/or cannot be reasonably predicted or estimated, such as the difficulties of estimating certain items such as charges to stock-based compensation expense. Accordingly, a reconciliation of the non-GAAP financial measure guidance to the corresponding GAAP measures is not available without unreasonable effort.

Model N, Inc.

Condensed Consolidated Balance Sheets

(in thousands)

 

 

As of June 30,
2022

 

As of September 30,
2021

Assets

 

 

 

Current assets

 

 

 

Cash and cash equivalents

$

184,486

 

 

$

165,467

 

Funds held for customers

 

174

 

 

 

316

 

Accounts receivable, net

 

38,485

 

 

 

43,185

 

Prepaid expenses

 

4,804

 

 

 

4,920

 

Other current assets

 

8,500

 

 

 

8,442

 

Total current assets

 

236,449

 

 

 

222,330

 

Property and equipment, net

 

1,584

 

 

 

1,907

 

Operating lease right-of-use assets

 

16,689

 

 

 

20,565

 

Goodwill

 

65,665

 

 

 

65,665

 

Intangible assets, net

 

39,370

 

 

 

45,394

 

Other assets

 

9,942

 

 

 

7,929

 

Total assets

$

369,699

 

 

$

363,790

 

Liabilities and Stockholders' Equity

 

 

 

Current liabilities

 

 

 

Accounts payable

$

3,278

 

 

$

4,802

 

Customer funds payable

 

174

 

 

 

316

 

Accrued employee compensation

 

20,379

 

 

 

24,662

 

Accrued liabilities

 

5,072

 

 

 

4,719

 

Operating lease liabilities, current portion

 

4,585

 

 

 

4,529

 

Deferred revenue, current portion

 

54,060

 

 

 

57,431

 

Total current liabilities

 

87,548

 

 

 

96,459

 

Long-term liabilities

 

 

 

Long term debt

 

132,512

 

 

 

124,301

 

Operating lease liabilities, less current portion

 

13,454

 

 

 

17,229

 

Other long-term liabilities

 

3,112

 

 

 

2,283

 

Total long-term liabilities

 

149,078

 

 

 

143,813

 

Total liabilities

 

236,626

 

 

 

240,272

 

Stockholders' equity

 

 

 

Common stock

 

6

 

 

 

5

 

Additional paid-in capital

 

411,557

 

 

 

380,528

 

Accumulated other comprehensive loss

 

(2,157

)

 

 

(1,205

)

Accumulated deficit

 

(276,333

)

 

 

(255,810

)

Total stockholders' equity

 

133,073

 

 

 

123,518

 

Total liabilities and stockholders' equity

$

369,699

 

 

$

363,790

 

 

 

 

 

Model N, Inc.

Condensed Consolidated Statements of Operations

(in thousands, except per share amounts)

 

 

Three Months Ended June 30,

 

Nine Months Ended June 30,

 

 

2022

 

 

 

2021

 

 

 

2022

 

 

 

2021

 

Revenues

 

 

 

 

 

 

 

Subscription

$

40,554

 

 

$

36,908

 

 

$

116,885

 

 

$

104,284

 

Professional services

 

15,618

 

 

 

14,130

 

 

 

44,109

 

 

 

37,680

 

Total revenues

 

56,172

 

 

 

51,038

 

 

 

160,994

 

 

 

141,964

 

Cost of revenues

 

 

 

 

 

 

 

Subscription

 

14,869

 

 

 

13,799

 

 

 

43,249

 

 

 

36,525

 

Professional services

 

9,938

 

 

 

9,651

 

 

 

28,260

 

 

 

27,418

 

Total cost of revenues

 

24,807

 

 

 

23,450

 

 

 

71,509

 

 

 

63,943

 

Gross profit

 

31,365

 

 

 

27,588

 

 

 

89,485

 

 

 

78,021

 

Operating expenses

 

 

 

 

 

 

 

Research and development

 

11,797

 

 

 

11,674

 

 

 

35,035

 

 

 

32,866

 

Sales and marketing

 

11,795

 

 

 

11,146

 

 

 

34,873

 

 

 

32,111

 

General and administrative

 

9,857

 

 

 

8,653

 

 

 

27,618

 

 

 

25,052

 

Total operating expenses

 

33,449

 

 

 

31,473

 

 

 

97,526

 

 

 

90,029

 

Loss from operations

 

(2,084

)

 

 

(3,885

)

 

 

(8,041

)

 

 

(12,008

)

Interest expense, net

 

3,794

 

 

 

3,631

 

 

 

11,420

 

 

 

10,645

 

Other expenses (income), net

 

(271

)

 

 

(39

)

 

 

(283

)

 

 

175

 

Loss before income taxes

 

(5,607

)

 

 

(7,477

)

 

 

(19,178

)

 

 

(22,828

)

Provision for income taxes

 

611

 

 

 

352

 

 

 

1,345

 

 

 

840

 

Net loss

$

(6,218

)

 

$

(7,829

)

 

$

(20,523

)

 

$

(23,668

)

Net loss per share:

 

 

 

 

 

 

 

Basic and diluted

$

(0.17

)

 

$

(0.22

)

 

$

(0.56

)

 

$

(0.67

)

Weighted average number of shares used in computing net loss per share:

 

 

 

 

 

 

 

Basic and diluted

 

36,935

 

 

 

35,679

 

 

 

36,591

 

 

 

35,305

 

 

 

 

 

 

 

 

 

Model N, Inc.

Condensed Consolidated Statements of Cash Flows

(in thousands)

 

 

Nine Months Ended June 30,

 

 

2022

 

 

 

2021

 

Cash Flows from Operating Activities

 

 

 

Net loss

$

(20,523

)

 

$

(23,668

)

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

 

 

 

Depreciation and amortization

 

6,725

 

 

 

5,740

 

Stock-based compensation

 

25,186

 

 

 

21,850

 

Amortization of debt discount and issuance costs

 

8,211

 

 

 

7,286

 

Deferred income taxes

 

414

 

 

 

84

 

Amortization of capitalized contract acquisition costs

 

3,152

 

 

 

2,223

 

Other non-cash charges

 

(515

)

 

 

?

 

Changes in assets and liabilities, net of acquisition

 

 

 

Accounts receivable

 

4,908

 

 

 

(2,382

)

Prepaid expenses and other assets

 

(1,611

)

 

 

(2,470

)

Accounts payable

 

(1,516

)

 

 

1,849

 

Accrued employee compensation

 

(794

)

 

 

745

 

Other current and long-term liabilities

 

(3,020

)

 

 

(3,095

)

Deferred revenue

 

(3,284

)

 

 

1,528

 

Net cash provided by operating activities

 

17,333

 

 

 

9,690

 

Cash Flows from Investing Activities

 

 

 

Purchases of property and equipment

 

(486

)

 

 

(842

)

Acquisition of business

 

?

 

 

 

(57,849

)

Net cash used in investing activities

 

(486

)

 

 

(58,691

)

Cash Flows from Financing Activities

 

 

 

Proceeds from exercise of stock options and issuance of common stock under employee stock purchase

plan

 

2,507

 

 

 

2,306

 

Net changes in customer funds payable

 

(142

)

 

 

6,908

 

Net cash provided by financing activities

 

2,365

 

 

 

9,214

 

Effect of exchange rate changes on cash and cash equivalents

 

(335

)

 

 

(30

)

Net increase (decrease) in cash and cash equivalents

 

18,877

 

 

 

(39,817

)

Cash and cash equivalents

 

 

 

Beginning of period

 

165,783

 

 

 

200,491

 

End of period

$

184,660

 

 

$

160,674

 

 

 

 

 

Model N, Inc.

Reconciliation of GAAP to Non-GAAP Operating Results

(in thousands, except per share amounts)

 

 

 

Three Months Ended June 30,

 

Nine Months Ended June 30,

 

 

 

2022

 

 

 

2021

 

 

 

2022

 

 

 

2021

 

Reconciliation from GAAP net loss to adjusted EBITDA

 

 

 

 

 

 

 

 

GAAP net loss

 

$

(6,218

)

 

$

(7,829

)

 

$

(20,523

)

 

$

(23,668

)

Reversal of non-GAAP items

 

 

 

 

 

 

 

 

Stock-based compensation expense

 

 

9,878

 

 

 

8,940

 

 

 

25,186

 

 

 

21,850

 

Depreciation and amortization

 

 

2,246

 

 

 

2,217

 

 

 

6,725

 

 

 

5,740

 

Acquisition-related expense

 

 

?

 

 

 

100

 

 

 

?

 

 

 

2,509

 

Interest expense, net

 

 

3,794

 

 

 

3,631

 

 

 

11,420

 

 

 

10,645

 

Other expenses (income), net

 

 

(271

)

 

 

(39

)

 

 

(283

)

 

 

175

 

Provision for income taxes

 

 

611

 

 

 

352

 

 

 

1,345

 

 

 

840

 

Adjusted EBITDA

 

$

10,040

 

 

$

7,372

 

 

$

23,870

 

 

$

18,091

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30,

 

Nine Months Ended June 30,

 

 

 

2022

 

 

 

2021

 

 

 

2022

 

 

 

2021

 

Reconciliation from GAAP gross profit to non-GAAP gross profit

 

 

 

 

 

 

 

 

GAAP gross profit

 

$

31,365

 

 

$

27,588

 

 

$

89,485

 

 

$

78,021

 

Reversal of non-GAAP expenses

 

 

 

 

 

 

 

 

Stock-based compensation (a)

 

 

2,574

 

 

 

2,435

 

 

 

5,989

 

 

 

5,460

 

Amortization of intangible assets (b)

 

 

709

 

 

 

709

 

 

 

2,127

 

 

 

1,700

 

Non-GAAP gross profit

 

$

34,648

 

 

$

30,732

 

 

$

97,601

 

 

$

85,181

 

Percentage of revenue

 

 

61.7

%

 

 

60.2

%

 

 

60.6

%

 

 

60.0

%

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30,

 

Nine Months Ended June 30,

 

 

 

2022

 

 

 

2021

 

 

 

2022

 

 

 

2021

 

Reconciliation from GAAP subscription gross profit to non-GAAP subscription gross profit

 

 

 

 

 

 

 

 

GAAP subscription gross profit

 

$

25,685

 

 

$

23,109

 

 

$

73,636

 

 

$

67,759

 

Reversal of non-GAAP expenses

 

 

 

 

 

 

 

 

Stock-based compensation (a)

 

 

1,380

 

 

 

1175

 

 

 

3,303

 

 

 

2,544

 

Amortization of intangible assets (b)

 

 

709

 

 

 

709

 

 

 

2,127

 

 

 

1,700

 

Non-GAAP subscription gross profit

 

$

27,774

 

 

$

24,993

 

 

$

79,066

 

 

$

72,003

 

Percentage of subscription revenue

 

 

68.5

%

 

 

67.7

%

 

 

67.6

%

 

 

69.0

%

 

 

 

Three Months Ended June 30,

 

Nine Months Ended June 30,

 

 

 

2022

 

 

 

2021

 

 

 

2022

 

 

 

2021

 

Reconciliation from GAAP professional services gross profit to non-GAAP professional services gross profit

 

 

 

 

 

 

 

 

GAAP professional services gross profit

 

$

5,680

 

 

$

4,479

 

 

$

15,849

 

 

$

10,262

 

Reversal of non-GAAP expenses

 

 

 

 

 

 

 

 

Stock-based compensation (a)

 

 

1,194

 

 

 

1,260

 

 

$

2,686

 

 

$

2,916

 

Non-GAAP professional services gross profit

 

$

6,874

 

 

$

5,739

 

 

$

18,535

 

 

$

13,178

 

Percentage of professional services revenue

 

 

44.0

%

 

 

40.6

%

 

 

42.0

%

 

 

35.0

%

 

 

 

Three Months Ended June 30,

 

Nine Months Ended June 30,

 

 

 

2022

 

 

 

2021

 

 

 

2022

 

 

 

2021

 

Reconciliation from GAAP operating loss to non-GAAP operating income

 

 

 

 

 

 

 

 

GAAP operating loss

 

$

(2,084

)

 

$

(3,885

)

 

$

(8,041

)

 

$

(12,008

)

Reversal of non-GAAP expenses

 

 

 

 

 

 

 

 

Stock-based compensation (a)

 

 

9,878

 

 

 

8,940

 

 

 

25,186

 

 

 

21,850

 

Amortization of intangible assets (b)

 

 

2,008

 

 

 

2,008

 

 

 

6,024

 

 

 

5,188

 

Acquisition-related expense (c)

 

 

?

 

 

 

100

 

 

 

?

 

 

 

2,509

 

Non-GAAP operating income

 

$

9,802

 

 

$

7,163

 

 

$

23,169

 

 

$

17,539

 

 

 

 

 

 

 

 

 

 

Numerator

 

 

 

 

 

 

 

 

Reconciliation between GAAP net loss and non-GAAP net income

 

 

 

 

 

 

 

 

GAAP net loss

 

$

(6,218

)

 

$

(7,829

)

 

$

(20,523

)

 

$

(23,668

)

Reversal of non-GAAP expenses

 

 

 

 

 

 

 

 

Stock-based compensation (a)

 

 

9,878

 

 

 

8,940

 

 

 

25,186

 

 

 

21,850

 

Amortization of intangible assets (b)

 

 

2,008

 

 

 

2,008

 

 

 

6,024

 

 

 

5,188

 

Acquisition-related expense (c)

 

 

?

 

 

 

100

 

 

 

?

 

 

 

2,509

 

Amortization of debt discount and issuance costs (d)

 

 

2,819

 

 

 

2,502

 

 

 

8,211

 

 

 

7,286

 

Non-GAAP net income

 

$

8,487

 

 

$

5,721

 

 

$

18,898

 

 

$

13,165

 

 

 

 

 

 

 

 

 

 

Denominator

 

 

 

 

 

 

 

 

Reconciliation between GAAP net loss and non-GAAP net income per share

 

 

 

 

 

 

 

 

Shares used in computing GAAP net loss per share:

 

 

 

 

 

 

 

 

Basic

 

 

36,935

 

 

 

35,679

 

 

 

36,591

 

 

 

35,305

 

Diluted

 

 

36,935

 

 

 

35,679

 

 

 

36,591

 

 

 

35,305

 

Shares used in computing non-GAAP net income per share

 

 

 

 

 

 

 

 

Basic

 

 

36,935

 

 

 

35,679

 

 

 

36,591

 

 

 

35,305

 

Diluted

 

 

37,107

 

 

 

36,800

 

 

 

36,831

 

 

 

36,562

 

GAAP net loss per share

 

 

 

 

 

 

 

 

Basic and diluted

 

$

(0.17

)

 

$

(0.22

)

 

$

(0.56

)

 

$

(0.67

)

Non-GAAP net income per share

 

 

 

 

 

 

 

 

Basic

 

$

0.23

 

 

$

0.16

 

 

$

0.52

 

 

$

0.37

 

Diluted

 

$

0.23

 

 

$

0.16

 

 

$

0.51

 

 

$

0.36

 

 

 

 

Three Months Ended June 30,

 

Nine Months Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

Amortization of intangibles assets recorded in the statements of operations

 

 

 

 

 

 

 

 

Cost of revenues

 

 

 

 

 

 

 

 

Subscription

 

$

709

 

$

709

 

$

2,127

 

$

1,700

Total amortization of intangibles assets in cost of revenue (b)

 

 

709

 

 

709

 

 

2,127

 

 

1,700

Operating expenses

 

 

 

 

 

 

 

 

Sales and marketing

 

 

1,299

 

 

1,299

 

 

3,897

 

 

3,488

Total amortization of intangibles assets in operating expense (b)

 

 

1,299

 

 

1,299

 

 

3,897

 

 

3,488

Total amortization of intangibles assets (b)

 

$

2,008

 

$

2,008

 

$

6,024

 

$

5,188

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30,

 

Nine Months Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

Stock-based compensation recorded in the statements of operations

 

 

 

 

 

 

 

 

Cost of revenues

 

 

 

 

 

 

 

 

Subscription

 

$

1,380

 

$

1,175

 

$

3,303

 

$

2,544

Professional services

 

 

1,194

 

 

1,260

 

 

2,686

 

 

2,916

Total stock-based compensation in cost of revenue (a)

 

 

2,574

 

 

2,435

 

 

5,989

 

 

5,460

Operating expenses

 

 

 

 

 

 

 

 

Research and development

 

 

1,826

 

 

1,776

 

 

4,616

 

 

4,520

Sales and marketing

 

 

2,223

 

 

2,091

 

 

5,669

 

 

5,611

General and administrative

 

 

3,255

 

 

2,638

 

 

8,912

 

 

6,259

Total stock-based compensation in operating expense (a)

 

 

7,304

 

 

6,505

 

 

19,197

 

 

16,390

Total stock-based compensation (a)

 

$

9,878

 

$

8,940

 

$

25,186

 

$

21,850

 

 

 

 

 

 

 

 

 

Use of Non-GAAP Financial Measures

To supplement our condensed consolidated financial statements presented on a GAAP basis, we use non-GAAP measures of adjusted EBITDA, gross profit, gross margin, income from operations, net income, weighted average shares outstanding and net income per share, which are adjusted to exclude stock-based compensation expense, amortization of intangible assets, acquisition-related expense, and amortization of debt discount and issuance costs and include dilutive shares where applicable. We believe these adjustments are appropriate to enhance an overall understanding of our past financial performance and also our prospects for the future. These adjustments to our current period GAAP results are made with the intent of providing both management and investors a more complete understanding of our underlying operating results and trends and our marketplace performance. The non-GAAP results are an indication of our baseline performance that are considered by management for the purpose of making operational decisions. In addition, these non-GAAP results are the primary indicators management uses as a basis for our planning and forecasting of future periods. The presentation of this additional information is not meant to be considered in isolation or as a substitute for operating loss, net loss or basic and diluted net loss per share prepared in accordance with generally accepted accounting principles in the United States. Non-GAAP financial measures are not based on a comprehensive set of accounting rules or principles and are subject to limitations.

While a large component of our expenses incurred in certain periods, we believe investors may want to exclude the effects of these items in order to compare our financial performance with that of other companies and between time periods:

(a)

Stock-based compensation is a non-cash expense accounted for in accordance with FASB ASC Topic 718. We believe that the exclusion of stock-based compensation expense provides for a better comparison of our operating results to prior periods and to our peer companies.

(b)

Amortization of intangible assets resulted principally from acquisitions. Intangible asset amortization is a non-cash item. As such, we believe exclusion of these expenses provides for a better comparison of our operating results to prior periods and to our peer companies.

(c)

Acquisition-related expense. Acquisition-related expense is incurred in connection with the acquisition and is non-recurring. As such, we believe that exclusion of these acquisition-related expense provides for a better comparison of our operation results to prior periods and to our peer companies.

(d)

Amortization of debt discount and issuance costs. Amortization of debt discount and issuance costs is a non-cash item. As such, we believe exclusion of these expenses provides for a better comparison of our operating results to prior periods and to our peer companies.

 


These press releases may also interest you

at 06:30
Red Pine Exploration Inc. ("Red Pine" or the "Company") is pleased to report new results from its 2022 exploration program. Red Pine continues to expand the footprint of mineralization outside the current resource of the Surluga Deposit and quantify...

at 06:30
The "Global Air and Missile Defense Radar (AMDR) Market (2022-2027) by Range, Applications, and Geography, Competitive Analysis and the Impact of Covid-19 with Ansoff Analysis" report has been added to ResearchAndMarkets.com's offering. The Global...

at 06:25
The "Europe Refrigerated Incubators Market Forecast to 2028 - COVID-19 Impact and Regional Analysis By Type and Application" report has been added to ResearchAndMarkets.com's offering. The Europe refrigerated incubators market is expected to grow...

at 06:15
The "Probiotics Food And Cosmetics Global Market Report 2022" report has been added to  ResearchAndMarkets.com's offering. This report provides strategists, marketers and senior management with the critical information they need to assess the global...

at 06:00
The "Microtome Market Analysis by Application, by Technology, by Product, and by Region - Global Forecast to 2029" report has been added to ResearchAndMarkets.com's offering. Increasing reimbursement facilities, increasing popularity of digital...

at 06:00
The "Global 3D Food Printing Market (2022-2027) by Technique, Ingredient, Vertical, and Geography, Competitive Analysis and the Impact of Covid-19 with Ansoff Analysis" report has been added to ResearchAndMarkets.com's offering. The Global 3D Food...



News published on 9 august 2022 at 16:15 and distributed by: