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China Auto Parking Group Holdings Plc is an active company incorporated on 19 April 2022 with the registered office located in London, Greater London. China Auto Parking Group Holdings Plc has been running for 10 months. There are currently 2 active directors and 1 active secretary according to the latest confirmation statement submitted on 16th June 2022.
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NewtekOne, Inc. Declares Quarterly Dividend of $0.18 per Share
Source: GlobeNewswire Inc.
NewtekOne, Inc. (the “Company”) (NASDAQ: NEWT), today announced that its Board of Directors declared a quarterly cash dividend of $0.18 per share, payable on April 14, 2023 to shareholders of record as of April 4, 2023.
NewtekOne®, Your Business Solutions Company®, is a financial holding company, which along with its bank and non-bank consolidated subsidiaries, provides a wide range of business and financial solutions under the Newtek® brand to the small- and medium-sized business (“SMB”) market. Since 1999, NewtekOne has provided state-of-the-art, cost-efficient products and services and efficient business strategies to SMB relationships across all 50 states to help them grow their sales, control their expenses and reduce their risk.
NewtekOne’s and its subsidiaries’ business and financial solutions include: banking (Newtek Bank, N.A.), Business Lending, Electronic Payment Processing, Technology Solutions (Cloud Computing, Data Backup, Storage and Retrieval, IT Consulting), eCommerce, Accounts Receivable Financing & Inventory Financing, Insurance Solutions, Web Services, and Payroll and Benefits Solutions
Newtek®, NewtekOne®, Newtek Bank, National Association™, Your Business Solutions Company® and One Solution for All Your Business Needs® are registered trademarks of NewtekOne, Inc.
Note Regarding Forward-Looking Statements
Certain statements in this press release are “forward-looking statements” within the meaning of the rules and regulations of the Private Securities Litigation and Reform Act of 1995. These statements are based on management’s current expectations and are subject to uncertainty and changes in circumstances. These statements are not guarantees of future results or occurrences. Actual results and capital and other financial conditions may differ materially from those included in these statements due to a variety of factors. These factors include, among others: macroeconomic and other challenges and uncertainties related to the COVID-19 pandemic, such as the impacts to the U.S. and global economies, as well as the broader impacts to financial markets and the global macroeconomic and geopolitical environments; higher inflation and its impacts; higher interest rates and the impacts on macroeconomic conditions, and NewtekOne, Inc.’s funding costs; NewtekOne, Inc’s conversion to a financial holding company, consummation of the acquisition of Newtek Bank, N.A. and Newtek One’s limited experience as a financial holding company and owning and operating a bank; and the precautionary statements included in this release. Factors that could cause NewtekOne, Inc’s actual results to differ materially from those described in the forward-looking statements can be found in NewtekOne, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2021 and Quarterly Reports on Form 10-Q for the quarters ended March 31, 2022, June 30, 2022, and September 30, 2022, filed May 9, 2022, August 8, 2022, and November 8, 2022, with the Securities and Exchange Commission and are available on NewtekOne, Inc’s website (https://investor.newtekbusinessservices.com/sec-filings), and on the Securities and Exchange Commission’s website (www.sec.gov). Any forward-looking statements made by or on behalf of NewtekOne, Inc. speak only as to the date they are made, and NewtekOne, Inc. does not undertake to update forward-looking statements to reflect the impact of circumstances or events that arise after the date the forward-looking statements were made.
SOURCE: NewtekOne, Inc.
Investor Relations & Public Relations
Contact: Jayne Cavuoto
Telephone: (212) 273-8179 / jcavuoto@newtekone.com
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NewtekOne, Inc. Reports Fourth Quarter and Full Year 2022 Financial Results
Source: GlobeNewswire Inc.
NewtekOne, Inc. (Nasdaq: NEWT) (the "Company"), announced today its financial and operating results for the three and twelve months ended December 31, 2022.
On January 6, 2023, the Company completed the acquisition of National Bank of New York City ("NBNYC"), withdrew its BDC election, and became a financial holding company. On January 13, 2023, Newtek Business Services Corp. changed its name to NewtekOne® and NBNYC, the 59-year-old nationally chartered bank, was renamed Newtek Bank, National Association, a wholly owned subsidiary of NewtekOne. As a result, NewtekOne, a financial holding company, no longer qualifies as a regulated investment company for federal income tax purposes and will no longer qualify for accounting treatment as an investment company. Going forward, Newtek Bank, N.A. and NewtekOne's former portfolio companies and other subsidiaries will be consolidated in the Company’s financial statements. As a result, NewtekOne's financial reporting metrics will change beginning with the first quarter 2023 quarterly report. NewtekOne's fourth quarter and full year 2022 results were recorded as a BDC and metrics such as net investment income (loss), adjusted net investment income (ANII), total investment income and leverage ratios will have diminished relevancy going forward. In addition, the financial results for the twelve months ended December 31, 2021, included $50.0 million of fee income from the Paycheck Protection Program ("PPP"), which, as previously disclosed, is not recurring. As of today, NewtekOne is a well-positioned financial holding company that owns a well-capitalized nationally chartered bank, Newtek Bank, N.A.
Barry Sloane, Chairman, President and Chief Executive Officer said, “Our future of becoming the market leader as an owner of a technology-enabled bank is not only within our grasp, it has begun, with the rollout of the first version of the Newtek Advantage® as well as our rebranding strategy and our redesigned website www.Newtekone.com. Our mobile account opening and online banking capability is now functional and clients can open a commercial and/or consumer deposit accounts in a frictionless manner by going to www.newtekbank.com. Our bank has already begun to open new bank accounts, take deposits and to fund loan originations. We project our balance sheet and earnings in 2023 and 2024 with optimism based on our 22 years of experience as a publicly traded company, in addition to our historical growth of revenues, earnings, and client footprint. We are updating our EPS projections to a range of $1.70 to $2.00 per share in 2023 and to a range of $2.80 to $3.20 per share in 2024. Given our market leadership in various segments of our business, we feel comfortable with these forecasts. In addition, today NewtekOne’s board of directors declared our first dividend as a financial holding company of $0.18 per share payable on April 14, 2023 to shareholders of record on April 4, 2023, which is above our previously forecasted guidance of $0.16 per share. We believe that our strong balance sheet and forward-thinking business strategy and plan has energized the entire Company and client base.”
Mr. Sloane continued, "Today's results and tomorrow's conference call will feature our final quarterly and annual earnings report as a BDC, While we are proud of what we have accomplished over our eight-year tenure as a BDC, we are also very excited about embarking on our new path as a financial holding company. This quarter and full year’s reported financial performance will be the last time we report as an investment company with 1940’s Act accounting. We are pleased to report our adjusted net investment income for the three and twelve months ended December 31, 2022 was $0.06 per share and $2.14 per share, respectively. Going forward, as a financial holding company we will be consolidating all subsidiaries in our financial statements and no longer qualify for accounting treatment as an investment company or tax treatment as a regulated investment company (RIC) under the IRS Code.”
Mr. Sloane continued, “Notably, throughout our tenure as a BDC since 2015, we paid out nearly $330 million in dividends and distributions and historically traded at a premium to NAV for the majority of our history. We grew our market capitalization prior to converting to a BDC from approximately $90 million to over $800 million at our highest share price. We move forward with a proud history of accomplishments for the fourth quarter and full year 2022, achieving record annual SBA 7(a) loan fundings, and selling debt and preferred shares in January and February 2023 as a financial holding company. We were able to accomplish all of this while preparing to open up our bank while our regulatory banking applications were pending approval, which was a challenge that we met admirably and efficiently.”
Fourth Quarter 2022 Financial Highlights
Total investment income of $23.1 million for the three months ended December 31, 2022; a decrease of (6.9)% compared to total investment income of $24.8 million for the three months ended December 31, 2021.
Net investment income (loss) of $(5.4) million, or $(0.22) per share, for the three months ended December 31, 2022, which represents a (414.3)% decrease, on a per share basis, compared to net investment income (loss) of $1.6 million, or $0.07 per share, for the three months ended December 31, 2021.
Adjusted net investment income ("ANII")1 of $1.5 million, or $0.06 per share, for the three months ended December 31, 2022; a decrease of (90.9)%, on a per share basis, compared to ANII of $16.0 million, or $0.66 per share, for the three months ended December 31, 2021.
Debt-to-equity ratio of 1.46x at December 31, 2022.
Total investment portfolio increased by 6.5% to $808.0 million at December 31, 2022, from $758.8 million at December 31, 2021.
Net asset value (“NAV”) of $375.4 million, or $15.25 per share, at December 31, 2022 compared to NAV of $16.72 per share at December 31, 2021.
Full Year 2022 Financial Highlights
Total investment income of $86.2 million for the twelve months ended December 31, 2022; a decrease of (20.5)% compared to total investment income of $108.5 million for the twelve months ended December 31, 2021, which included $50.0 million of fee income from the PPP, which, as previously disclosed, is not recurring.
Net investment loss of $(6.5) million, or $(0.27) per share, for the twelve months ended December 31, 2022, which represents a (123.0)% decrease, on a per share basis, compared to net investment income of $25.7 million, or $1.13 per share, for the twelve months ended December 31, 2021, which included $50.0 million of fee income from the PPP which, as previously disclosed, is not recurring.
ANII1 of $51.9 million, or $2.14 per share, for the twelve months ended December 31, 2022; a decrease of (34.5)%, on a per share basis, compared to ANII of $79.1 million, or $3.47 per share, for the twelve months ended December 31, 2021, which included $50.0 million of fee income from the PPP which, as previously disclosed, is not recurring.
2022 Dividends and Distributions/2023 Declaration
On December 30, 2022, the Company paid a fourth quarter 2022 cash distribution of $0.70 per share to shareholders of record as of December 20, 2022.
The Company paid $2.75 per share in dividends and distributions in 2022.
Throughout the Company's tenure as a BDC since 2015, it paid out nearly $330 million in dividends and distributions.
NewtekOne’s board of directors declared a dividend of $0.18 per share2 today, which exceeds the Company’s previously forecasted dividend projection of $0.16 per share. The dividend is payable on April 14, 2023 to shareholders of record as of April 4, 2023, and is the Company's first dividend declared as a financial holding company.
Lending Highlights
Newtek Small Business Finance, LLC (“NSBF”) funded a record $775.6 million in SBA 7(a) loans for the twelve months ended December 31, 2022, meeting its previously stated full year 2022 SBA 7(a) loan funding guidance of $775 million, which represents an 38.4% increase over $560.6 million SBA 7(a) loan fundings for the twelve months ended December 31, 2021.
NSBF funded $188.7 million of SBA 7(a) loans during the three months ended December 31, 2022; a (4.7)% decrease over the $198.0 million of SBA 7(a) loans funded for the three months ended December 31, 2021.
NewtekOne forecasts $875 million in SBA 7(a) loan fundings in 2023, which would represent a 12.9% increase over 2022
Newtek Business Lending ("NBL"), closed a record $111.6 million of SBA 504 loans for the twelve months ended December 31, 2022; an increase of 23.9% over $90.1 million of SBA 504 loans closed during the same period in 2021.
Mr. Sloane concluded, “I want to reiterate that the analysis of our final financials as a BDC, in particular with respect to NAV, net investment income, ANII and leverage ratios, although important, we believe has diminished relevance in analyzing NewtekOne on a going forward basis as a result of our change in accounting as a financial holding company in 2023 and emphasis going forward on after-tax net income. As a business solutions company with forecasted returns on average assets (ROA) and forecasted returns on tangible common equity (ROTCE), which we do not believe are typically found in bank holding companies or banks, differentiates us in the market. During our conference call tomorrow morning at 8:30 a.m., we will focus on our financial holding company projections for 2023 and 2024. Our accompanying financial results presentation for tomorrow’s conference call can be found on our website in the investor relations section at http://investor.newtekbusinessservices.com/events-and-presentations. The presentation will highlight our exit as a BDC and focus on our forward-looking updated projections and forecasts of the publicly traded financial holding company as well as the wholly owned bank subsidiary.”
Fourth Quarter and Full Year 2022 Conference Call and Webcast
A conference call to discuss the fourth quarter and full year 2022 financial results will be hosted by Barry Sloane, President, Chairman and Chief Executive Officer, and Nicholas Leger, Chief Accounting Officer, tomorrow, Tuesday, February 28, 2023 8:30 a.m. ET.
Please note, to attend the conference call or webcast, participants should register online at http://investor.newtekbusinessservices.com/events-and-presentations. To receive a dial-in number, participants are requested to register at a minimum 15 minutes before the start of the call. The corresponding presentation will be available in the ‘Events & Presentations’ section of the Investor Relations portion of NewtekOne's website at http://investor.newtekbusinessservices.com/events-and-presentations. A replay of the call with the corresponding presentation will be available on NewtekOne's website shortly following the live presentation and will be available for a period of 90 days.
1Use of Non-GAAP Financial Measures - NewtekOne, Inc. and Subsidiaries
In evaluating its business, Newtek considers and uses ANII as a measure of its operating performance. ANII includes short-term capital gains from the sale of the guaranteed portions of SBA 7(a) loans and conventional loans, and beginning in 2016, capital gain distributions from controlled portfolio companies, which are reoccurring events. The Company defines ANII as net investment income (loss) plus net realized gains recognized from the sale of guaranteed portions of SBA 7(a) loan investments, less realized losses on non-affiliate investments, plus the net realized gains on controlled investments, plus or minus the change in fair value of contingent consideration liabilities, plus loss on extinguishment of debt, plus or minus an adjustment for gains or losses on derivative transactions.
We do not designate derivatives as hedges to qualify for hedge accounting and therefore any net payments under, or fluctuations in the fair value of, our derivatives are recognized currently in our GAAP income statement. However, fluctuations in the fair value of the related assets are not included in our income statement. We consider the gain or loss on our hedging positions related to assets that we still own as of the reporting date to be “open hedging positions.” While recognized for GAAP purposes, we exclude the results on the hedges from ANII until the related asset is sold and/or the hedge position is “closed,” whereupon they would then be included in ANII in that period. These are reflected as “adjustment for realized gain/(loss) on derivatives” for purposes of computing ANII for the period. Management believes that excluding these specifically identified gains and losses associated with the open hedging positions adjusts for timing differences between when we recognize changes in the fair values of our assets and changes in the fair value of the derivatives used to hedge such assets.
The term ANII is not defined under U.S. generally accepted accounting principles, or U.S. GAAP, and is not a measure of operating income, operating performance or liquidity presented in accordance with U.S. GAAP. ANII has limitations as an analytical tool and, when assessing the Company’s operating performance, investors should not consider ANII in isolation, or as a substitute for net investment income, or other consolidated income statement data prepared in accordance with U.S. GAAP. Among other things, ANII does not reflect the Company’s actual cash expenditures. Other companies may calculate similar measures differently than Newtek, limiting their usefulness as comparative tools. The Company compensates for these limitations by relying primarily on its GAAP results supplemented by ANII. Reconciliation tables showing the adjustments made to net investment income to determine NII are attached to this press release.
2 Note Regarding Dividend Payments
Amount and timing of dividends, if any, remain subject to the discretion of the Company's Board of Directors. The determination of the tax attributes of the Company's 2022 distributions as a BDC is made as of the end of the Company's 2022 fiscal year based upon its taxable income for the full year and distributions paid for the full year.
NewtekOne®, Your Business Solutions Company®, is a financial holding company, which along with its bank and non-bank consolidated subsidiaries, provides a wide range of business and financial solutions under the Newtek® brand to the small- and medium-sized business (“SMB”) market. Since 1999, NewtekOne has provided state-of-the-art, cost-efficient products and services and efficient business strategies to SMB relationships across all 50 states to help them grow their sales, control their expenses and reduce their risk.
NewtekOne’s and its subsidiaries’ business and financial solutions include: banking (Newtek Bank, N.A.), Business Lending, Electronic Payment Processing, Technology Solutions (Cloud Computing, Data Backup, Storage and Retrieval, IT Consulting), eCommerce, Accounts Receivable Financing & Inventory Financing, Insurance Solutions, Web Services, and Payroll and Benefits Solutions.
Newtek®, NewtekOne®, Newtek Bank, National AssociationTM, Your Business Solutions Company® and One Solution for All Your Business Needs® are registered trademarks of NewtekOne, Inc.
Note Regarding Forward-Looking Statements
Certain statements in this press release are “forward-looking statements” within the meaning of the rules and regulations of the Private Securities Litigation and Reform Act of 1995. These statements are based on management’s current expectations and are subject to uncertainty and changes in circumstances. These statements are not guarantees of future results or occurrences. Actual results and capital and other financial conditions may differ materially from those included in these statements due to a variety of factors. These factors include, among others: macroeconomic and other challenges and uncertainties related to the COVID-19 pandemic, such as the impacts to the U.S. and global economies, as well as the broader impacts to financial markets and the global macroeconomic and geopolitical environments; higher inflation and its impacts; higher interest rates and the impacts on macroeconomic conditions, and NewtekOne, Inc.’s funding costs; NewtekOne, Inc’s conversion to a financial holding company, consummation of the acquisition of Newtek Bank, N.A. and Newtek One’s limited experience as a financial holding company and owning and operating a bank; and the precautionary statements included in this release. Factors that could cause NewtekOne, Inc’s actual results to differ materially from those described in the forward-looking statements can be found in NewtekOne, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2021 and Quarterly Reports on Form 10-Q for the quarters ended March 31, 2022, June 30, 2022, and September 30, 2022, filed May 9, 2022, August 8, 2022, and November 8, 2022, with the Securities and Exchange Commission and are available on NewtekOne, Inc’s website (https://investor.newtekbusinessservices.com/sec-filings), and on the Securities and Exchange Commission’s website (www.sec.gov). Any forward-looking statements made by or on behalf of NewtekOne, Inc. speak only as to the date they are made, and NewtekOne, Inc. does not undertake to update forward-looking statements to reflect the impact of circumstances or events that arise after the date the forward-looking statements were made. .
SOURCE: NewtekOne, Inc.
Investor Relations & Public Relations
Contact: Jayne Cavuoto
Telephone: (212) 273-8179 / jcavuoto@newtekone.com
NEWTEKONE INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES
(In Thousands, except for Per Share Data)
December 31, 2022 December 31, 2021
ASSETS (Unaudited)
Investments, at fair value
SBA unguaranteed non-affiliate investments (cost of $532,793 and $431,970, respectively; includes $423,686 and $344,266, respectively, related to securitization trusts) $ 505,268 $ 424,417
SBA guaranteed non-affiliate investments (cost of $18,460 and $65,728, respectively) 19,171 72,970
Controlled investments (cost of $154,809 and $157,289, respectively) 282,239 260,398
Non-control investments (cost of $1,360 and $1,000, respectively) 1,360 1,000
Total investments, at fair value 808,038 758,785
Cash 53,692 2,397
Restricted cash 71,914 184,463
Broker receivable — 44,537
Due from related parties 1,338 4,395
Servicing assets, at fair value 30,268 28,008
Right of use assets 6,484 7,310
Other assets 27,168 26,666
Total assets $ 998,902 $ 1,056,561
LIABILITIES AND NET ASSETS
Liabilities:
Bank notes payable $ 55,885 $ 50,000
2024 Notes (par: $38,250 and $38,250 as of December 31, 2022 and December 31, 2021) 37,903 37,679
2025 6.85% Notes (par: $0 and $15,000 as of December 31, 2022 and December 31, 2021) — 14,545
2025 5.00% Notes (par: $30,000 and $0 as of December 31, 2022 and December 31, 2021) 29,306 —
2026 Notes (par: $115,000 and $115,000 as of December 31, 2022 and December 31, 2021) 112,846 112,128
Notes payable - Securitization trusts (par: $283,143 and $249,750 as of December 31, 2022 and December 31, 2021) 279,136 246,250
Notes payable - related parties 24,250 11,450
Due to related parties 1,211 1,490
Lease liabilities 7,973 9,056
Deferred tax liabilities 19,194 12,733
Due to participants 35,627 146,225
Derivative instruments — 183
Accounts payable, accrued expenses and other liabilities 20,213 10,935
Total liabilities 623,544 652,674
Commitment and contingencies
Net assets:
Preferred stock (par value $0.02 per share; authorized 1,000 shares, no shares issued and outstanding) — —
Common stock (par value $0.02 per share; authorized 200,000 shares, 24,609 and 24,159 issued and outstanding, respectively) 492 483
Additional paid-in capital 354,243 367,663
Accumulated undistributed earnings 20,623 35,741
Total net assets 375,358 403,887
Total liabilities and net assets $ 998,902 $ 1,056,561
Net asset value per common share $ 15.25 $ 16.72
NEWTEKONE INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands, except for Per Share Data)
Year Ended December 31,
2022 2021 2020
Investment income
From non-affiliate investments:
Interest income - PPP loans $ — $ 49,989 $ 37,743
Interest income - SBA 7(a) loans 35,696 25,951 24,719
Servicing income 13,698 11,307 11,154
Other income 8,600 5,696 2,693
Total investment income from non-affiliate investments 57,994 92,943 76,309
From non-control investments:
Interest income — 428 403
Dividend income 83 95 104
Total investment income from non-control investments 83 523 507
From controlled investments:
Interest income 2,921 2,598 1,933
Dividend income 24,574 9,801 13,452
Other income 672 2,629 —
Total investment income from controlled investments 28,167 15,028 15,385
Total investment income 86,244 108,494 92,201
Expenses:
Salaries and benefits 20,186 17,866 14,211
Interest 26,325 20,515 17,877
Depreciation and amortization 239 304 402
Professional fees 7,134 5,610 3,718
Origination and loan processing 11,606 10,234 8,431
Origination and loan processing - related party 19,140 19,272 9,855
Change in fair value of contingent consideration liabilities — — 54
Loss on extinguishment of debt 417 1,552 —
Other general and administrative costs 7,673 7,454 5,668
Total expenses 92,720 82,807 60,216
Net investment (loss) income (6,476 ) 25,687 31,985
Net realized and unrealized gains (losses):
Net realized gain on non-affiliate investments - SBA 7(a) loans 56,901 53,113 11,368
Net realized loss on controlled investments — (1,266 ) —
Net realized gain on derivative transactions 445 590 —
Net unrealized (depreciation) appreciation on SBA guaranteed non-affiliate investments (6,532 ) 6,380 (795 )
Net unrealized (depreciation) appreciation on SBA unguaranteed non-affiliate investments (19,972 ) 5,097 (176 )
Net unrealized appreciation (depreciation) on controlled investments 24,321 2,829 (8,237 )
Change in deferred taxes (6,464 ) (1,327 ) 999
Net unrealized appreciation (depreciation) on derivative transactions 183 (183 ) —
Net unrealized depreciation on servicing assets (10,095 ) (6,778 ) (1,525 )
Net realized and unrealized gains $ 38,787 $ 58,455 $ 1,634
Net increase in net assets resulting from operations $ 32,311 $ 84,142 $ 33,619
Net increase in net assets resulting from operations per share $ 1.34 $ 3.69 $ 1.59
Net investment (loss) income per share $ (0.27 ) $ 1.13 $ 1.51
Dividends and distributions declared per common share $ 2.75 $ 3.15 $ 2.05
Weighted average number of shares outstanding 24,198 22,795 21,146
NEWTEKONE INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands, except for Per Share Data)
Quarter Ended December 31,
2022 2021 2020
Investment income
From non-affiliate investments:
Interest income - PPP loans $ — $ — $ 1
Interest income 11,781 6,623 5,337
Servicing income 3,767 2,961 2,787
Other income 2,101 1,867 1,244
Total investment income from non-affiliate investments 17,649 11,451 9,369
From Non-control/affiliate investments
Interest income — 54 296
Dividend income 21 25 33
Total investment income from non-control/affiliate investments 21 79 329
From controlled investments:
Interest income 834 895 510
Dividend income 4,585 9,750 4,568
Other income — 2,629 —
Total investment income from controlled investments 5,419 13,274 5,078
Total investment income 23,089 24,804 14,776
Expenses:
Salaries and benefits 5,806 5,139 3,355
Interest 8,913 5,298 4,150
Depreciation and amortization 58 68 90
Professional fees 2,812 2,145 896
Origination and servicing 4,404 (321 ) 2,765
Origination and servicing - related party 4,442 8,442 1,417
Loss on extinguishment of debt — 597 —
Other general and administrative costs 2,054 1,791 1,253
Total expenses 28,489 23,159 13,926
Net investment (loss) income (5,400 ) 1,645 850
Net realized and unrealized gains (losses):
Net realized gain on non-affiliate investments - SBA 7(a) loans 6,948 15,034 8,791
Net realized loss on controlled investments — (1,266 ) —
Net realized gain on derivative transactions — 858 —
Net unrealized (depreciation) appreciation on SBA guaranteed non-affiliate investments (590 ) 3,847 (301 )
Net unrealized (depreciation) appreciation on SBA unguaranteed non-affiliate investments (13,499 ) 2,514 5,836
Net unrealized appreciation on controlled investments 22,739 1,069 2,919
Change in provision for deferred taxes on unrealized (appreciation) depreciation on investments (6,289 ) 793 (2,011 )
Net unrealized depreciation on non-control/non-affiliate investments — (521 ) —
Net unrealized depreciation on servicing assets (6,131 ) (3,456 ) (226 )
Net unrealized loss on derivative transactions — (487 ) —
Net realized and unrealized gains $ 3,178 $ 18,385 $ 15,008
Net (decrease) increase in net assets $ (2,222 ) $ 20,030 $ 15,858
Net (decrease) increase in net assets per share $ (0.09 ) $ 0.84 $ 0.73
Net investment (loss) gain per share $ (0.22 ) $ 0.07 $ 0.04
Dividends and distributions declared per common share $ 0.70 $ 1.05 $ 0.47
Weighted-average number of shares used in per share calculations 24,425 23,764 21,747
NEWTEKONE INC. AND SUBSIDIARIES
NON-GAAP FINANCIAL MEASURES-
ADJUSTED NET INVESTMENT INCOME RECONCILIATION:
Year ended Year ended
(in thousands, except per share amounts) December 31, 2022 Per share December 31, 2021 Per share
Net investment (loss) income $ (6,476 ) $ (0.27 ) $ 25,687 $ 1.13
Net realized gain on non-affiliate investments - SBA 7(a) loans 56,901 2.35 53,113 2.33
Net realized loss on controlled investments — — (1,266 ) (0.06 )
Adjustment for realized gain on derivatives (1) 1,010 0.04 25 0.00
Loss on debt extinguishment 417 0.02 1,552 0.07
Adjusted net investment income $ 51,852 $ 2.14 $ 79,111 $ 3.47
Note: Amounts may not foot due to rounding
(1) The following is a reconciliation of GAAP net realized gain/(loss) on derivative transactions to our adjustment for realized gain/(loss) on derivatives on closed transactions presented in the computation of ANII in the preceding table:
Year ended Year ended
(in thousands, except per share amounts) December 31, 2022 Per share December 31, 2021 Per share
Net realized gain on derivatives $ 445 $ 0.02 $ 590 $ 0.03
Hedging realized result on open hedging positions — — (565 ) (0.02 )
Hedging realized adjustment on hedging positions closed during current period 565 0.02 — —
Adjustment for realized gain on derivatives $ 1,010 $ 0.04 $ 25 $ 0.00
Note: Amounts may not foot due to rounding
NEWTEKONE, INC. AND SUBSIDIARIES
NON-GAAP FINANCIAL MEASURES-
ADJUSTED NET INVESTMENT INCOME RECONCILIATION:
Three months ended Three months ended
(in thousands, except per share amounts) December 31, 2022 Per share December 31, 2021 Per share
Net investment (loss) income $ (5,400 ) $ (0.22 ) $ 1,645 $ 0.07
Net realized gain on non-affiliate investments - SBA 7(a) loans 6,948 0.28 15,034 0.63
Net realized loss on controlled investments — — (1,266 ) (0.06 )
Adjustment for realized gain on derivatives (1) — — 32 0.00
Loss on debt extinguishment — — 597 0.03
Adjusted net investment income $ 1,548 $ 0.06 $ 16,042 $ 0.66
Note: Amounts may not foot due to rounding
(1) The following is a reconciliation of GAAP net realized gain/(loss) on derivative transactions to our adjustment for realized gain/(loss) on derivatives on closed transactions presented in the computation of ANII in the preceding table:
Three months ended Three months ended
(in thousands, except per share amounts) December 31, 2022 Per share December 31, 2021 Per share
Net realized gain on derivatives $ — $ — $ 858 $ 0.04
Hedging realized result on open hedging positions — — (826 ) (0.03 )
Adjustment for realized gain on derivatives $ — $ — $ 32 $ 0.00
Note: Amounts may not foot due to rounding
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Tyler Technologies Acquires Safeground Analytics
Source: Business Wire
Acquisition to elevate appraisal services offerings for assessment community
Tyler Technologies, Inc. (NYSE: TYL) announced today it has acquired Safeground Analytics, a company providing exemplary real estate appraisals and assessments for states, counties, and municipalities. Safeground brings an experienced team of appraisers, analysts, statisticians, economists, computer scientists, and assessors to provide residential and commercial reassessments, bolstering Tyler’s existing appraisal services business.
“Tyler has been the leader in the appraisal market for more than 80 years, and we remain committed to strengthening our service offerings in this space,” said Mark Hawkins, president of Tyler’s Property & Recoding Division. “Safeground has been our partner on numerous valuation projects over the years, and we continue to be impressed by the company’s strong client retention, their deep appraisal experience – particularly with complex commercial properties – and their commitment to supporting the education and training of assessors. We are excited to welcome them to the Tyler team.”
Since 2015, Tyler has worked with Safeground on multifaceted valuation projects in New England and is currently contracting its services for three county-wide commercial reassessments in Delaware. Safeground has a strong presence in the New England and mid-Atlantic markets, which complements Tyler’s nationwide appraisal footprint.
In addition to appraisal services, Safeground brings expertise in litigation support and expert witness testimony for property appraisal matters, as well as auditing and monitoring services, expanding Tyler’s appraisal services offerings. The company is experienced in providing education training courses to further strengthen and grow Tyler’s professional services offerings to the assessment community.
“Joining a company with such a broad – and growing – footprint means exciting opportunities to expand our appraisal services and benefit assessors nationwide,” said John Valente, chief executive officer of Safeground. “Tyler and Safeground share similar values, expertise, and a commitment to International Association of Assessing Officers (IAAO) technical standards for fair and equitable property assessments. We are excited to integrate our expertise and make an impact on nationwide appraisal services.”
Founded by John Valente, Safeground is currently based in Northampton, Massachusetts. The Safeground team will join Tyler’s Property & Recording Division but will remain in New England as remote employees. John will serve as Northeast Regional Appraisal Manager.
About Tyler Technologies, Inc.
Tyler Technologies (NYSE: TYL) provides integrated software and technology services to the public sector. Tyler’s end-to-end solutions empower local, state, and federal government entities to operate more efficiently and connect more transparently with their constituents and with each other. By connecting data and processes across disparate systems, Tyler’s solutions are transforming how clients gain actionable insights that solve problems in their communities. Tyler has more than 37,000 successful installations across more than 12,000 locations, with clients in all 50 states, Canada, the Caribbean, Australia, and other international locations. Tyler has been recognized numerous times for growth and innovation, including Government Technology’s GovTech 100 list and Forbes’ “Most Innovative Growth Companies” list. More information about Tyler Technologies, an S&P 500 company headquartered in Plano, Texas, can be found at tylertech.com.
#TYL_Financial
View source version on businesswire.com: https://www.businesswire.com/news/home/20230301005225/en/
Jennifer Kepler
Tyler Technologies
972.713.3770
Media.team@tylertech.com
https://www.otcmarkets.com/stock/CDXQ/profile
CDXQ
China De Xiao Quan Care Group Co., Ltd
BUSINESS DESCRIPTION
The company is a global pioneer in elderly caring industry, combining new generation of cloud intelligence with human-focused management. Adopting new methods based on internet, elderly caring and comprehensive health concept, the company has self-developed an intelligent caring system based on big data analysis and artificial intelligence, strengthening better care and tracking management for the elderly. Through online and offline training courses, the company has provided elderly caring institutions with numerous professional nurses and talented management people. Committed to the great vision of “Bringing Global Elderly Back To Childhood And Establishing A Healthy, Happy and Cheerful Home”, the company strives to build over 20,000 community nursing service centers, provide over 100,000 professional nurses and management people, and develop over 50 million senior citizens with De Xiao Quan platform membership.
https://investors.tylertech.com/news/news-details/2023/Tyler-Technologies-Reports-Earnings-for-Fourth-Quarter-2022/default.aspx
Tyler Technologies Reports Earnings for Fourth Quarter 2022
02/15/2023
SaaS annualized recurring revenue grew 19.3%
PLANO, Texas--(BUSINESS WIRE)-- Tyler Technologies, Inc. (NYSE: TYL) today announced financial results for the fourth quarter ended December 31, 2022.
Fourth Quarter 2022 Financial Highlights:
Total revenues were $452.2 million, up 4.3% from $433.5 million for the fourth quarter of 2021. On an organic basis (excluding COVID-related revenues), revenues grew 6.0%. Non-GAAP total revenues were $452.2 million, up 4.2% from $434.2 million for the fourth quarter of 2021. On an organic basis, non-GAAP revenues grew 5.8%.
Recurring revenues from maintenance and subscriptions were $374.0 million, up 7.7% from $347.2 million for the fourth quarter of 2021, and comprised 82.7% of fourth quarter 2022 revenues, up from 80.1% for the fourth quarter of 2021. On an organic basis, recurring revenues were $367.3 million, up 9.1%. SaaS revenues included in subscriptions grew 19.3% to $110.2 million.
Professional services revenues included a total of $3.5 million from NIC's COVID-related initiatives, which ended in the fourth quarter of 2022, compared to $6.0 million for the fourth quarter of 2021.
Operating income was $40.7 million compared to $48.1 million for the fourth quarter of 2021. Non-GAAP operating income was $97.9 million, down 4.5% from $102.5 million for the fourth quarter of 2021.
Net income was $31.1 million, or $0.73 per diluted share, down 43.3% from $54.8 million, or $1.29 per diluted share, for the fourth quarter of 2021. Non-GAAP net income was $70.4 million, or $1.66 per diluted share, down 5.3% from $74.3 million, or $1.75 per diluted share, for the fourth quarter of 2021.
Cash flows from operations were $121.9 million, up 6.0% from $115.0 million for the fourth quarter of 2021. Free cash flow was $114.7 million, up 20.6% from $95.1 million for the fourth quarter of 2021.
Adjusted EBITDA was $109.8 million, down 0.4% from $110.3 million for the fourth quarter of 2021.
Software subscription arrangements comprised approximately 86% of total new software contract value for the fourth quarter, compared to approximately 77% for the fourth quarter of 2021.
Subscription bookings for the fourth quarter added $21.4 million in annual recurring revenue.
Annualized non-GAAP recurring revenues were $1.50 billion, up 7.5% from $1.39 billion for the fourth quarter of 2021.
During the fourth quarter, Tyler completed the acquisition of Rapid Financial Solutions for approximately $68 million in cash, net of cash acquired, and Tyler stock.
Full Year 2022 Financial Highlights:
Total revenues were $1.850 billion, up 16.2% from $1.592 billion in 2021. On an organic basis (excluding COVID-related revenues), revenues grew 8.2%. Non-GAAP total revenues were $1.850 billion, up 16.0% from $1.595 billion in 2021. On an organic basis, non-GAAP revenues grew 8.0%.
Recurring revenues from maintenance and subscriptions were $1.481 billion, up 17.6% from $1.259 billion in 2021, and comprised 80.0% of 2022 revenues, up from 79.1% in 2021. On an organic basis, recurring revenues were $1.317 billion, up 9.8%.
Subscription revenue and software services revenues included a total of $51.0 million from NIC's COVID-related initiatives, which ended in the fourth quarter of 2022. COVID-related revenues totaled $75.0 million in 2021. SaaS revenues included in subscriptions grew 24.8% to $411.5 million.
Operating income was $214.2 million, up 18.5% from $180.7 million in 2021. Non-GAAP operating income was $437.1 million, up 7.8% from $405.5 million in 2021.
Net income was $164.2 million, or $3.87 per diluted share, up 1.7% from $161.5 million, or $3.82 per diluted share in 2021. Non-GAAP net income was $318.1 million, or $7.50 per diluted share, up 7.3% from $296.5 million, or $7.02 per diluted share in 2021.
Cash flows from operations were $381.5 million, up 2.6% from $371.8 million in 2021. Free cash flow was $331.3 million, up 4.8% from $316.1 million in 2021.
Adjusted EBITDA was $475.0 million, up 9.0% from $435.7 million in 2021.
Software subscription arrangements comprised approximately 83% of total new software contract value in 2022, compared to approximately 71% in 2021.
Subscription bookings in 2022 added $93.4 million in annual recurring revenue.
Total backlog was a new high of $1.889 billion, up 5.2% from $1.796 billion at December 31, 2021.
“Our fourth quarter results marked a solid finish to an eventful year, as public sector demand remains strong and SaaS adoption continues at an accelerated pace,” said Lynn Moore, Tyler’s president and chief executive officer. “The Tyler team executed well with strong cross-division sales synergies and several multi-suite wins during the quarter. Even as our SaaS mix expanded to 86% of our new software contract value, we achieved organic growth (excluding COVID-related revenues) of 6.0% for the fourth quarter and 8.2% for the year. As expected, operating margins were pressured by the acceleration of our cloud transition, as well as an increase in R&D expense as certain development costs that we expected to capitalize were expensed.
"During 2022, we achieved notable milestones toward several key strategic initiatives. We integrated our payments teams and launched a significant go-to-market strategy for payments. We also leveraged our strong relationships across state and local agencies to expand our cross-sell opportunities. We made meaningful progress in our cloud journey through continued investment in cloud optimization and through a move to cloud-only deployment for many of our core solutions. Overall, the year was highlighted by significant wins, highly successful upsell efforts, and state enterprise renewals and expansions.
"Throughout the year, we demonstrated a balanced yet opportunistic approach across our business and with respect to capital allocation. While our bar is high for acquisitions, we maintain a strategic lens toward M&A opportunities and closed three transactions during 2022 that bring innovative and robust offerings to elevate our payments business and broaden our product suites. We further strengthened our balance sheet and aggressively reduced our term debt with fourth quarter repayments of $90 million. For the full year, we reduced debt by $360 million, bringing our net leverage at year-end to 1.64 times proforma EBITDA.
"As we move into 2023, I've never been more confident about Tyler's long-term prospects. This is an important year in our cloud transition, and we expect to reach an inflection point with a significant decline in license revenue that is being replaced by valuable long-term recurring SaaS revenue. In addition to short-term revenue headwinds from this mix shift, operating margins are expected to trough this year with a return to margin expansion in 2024. As we discussed throughout last year, we will also experience revenue comparison headwinds due to the end of COVID-related revenues in the fourth quarter of 2022. We're pleased that our 2023 guidance reflects expectations for high single-digit organic revenue growth, excluding COVID-related revenues, and we look forward to reporting our progress on our growth initiatives throughout the coming year," concluded Moore.
Guidance for 2023
As of February 15, 2023, Tyler Technologies is providing the following guidance for the full year 2023:
GAAP and non-GAAP total revenues are both expected to be in the range of $1.935 billion to $1.970 billion.
GAAP diluted earnings per share are expected to be in the range of $4.10 to $4.25 and may vary significantly due to the impact of stock incentive awards on the GAAP effective tax rate.
Non-GAAP diluted earnings per share are expected to be in the range of $7.50 to $7.65.
Interest expense is expected to be approximately $26 million, including approximately $4 million of amortization of debt discounts and issuance costs.
Pretax share-based compensation expense is expected to be approximately $99 million.
Research and development expense is expected to be in the range of $108 million to $110 million.
Fully diluted shares for the year are expected to be in the range of 42.5 million to 43.0 million shares.
GAAP earnings per share assumes an estimated annual effective tax rate of approximately 21% after discrete tax items including approximately $1 million of discrete tax benefits related to share-based compensation.
The non-GAAP annual effective tax rate is expected to be 22%.
Capital expenditures are expected to be in the range of $68 million to $70 million, including approximately $37 million of software development costs. Total depreciation and amortization expense is expected to be approximately $132 million, including approximately $91 million from amortization of acquisition intangibles.
GAAP to non-GAAP guidance reconciliation
Non-GAAP diluted earnings per share excludes the estimated full year impact of share-based compensation expense and employer portion of payroll tax related to employee stock transactions of approximately $99 million, and amortization of acquired software and intangible assets of approximately $91 million. Additionally, the non-GAAP tax rate of 22.0% is estimated periodically as described below under "Non-GAAP Financial Measures" and excludes approximately $1 million of estimated discrete tax benefits that are included in the GAAP estimated annual effective tax rate.
Conference Call
Tyler Technologies will hold a conference call on Thursday, February 16, 2023 at 10:00 a.m. ET to discuss the company’s results. Participants can register in advance for the conference through the following link: https://conferencingportals.com/event/dXimaDxA. Registered participants will receive an email with a calendar reminder and dial-in number and PIN that will allow them to listen to the call live.
The live audio webcast and archived replay can also be accessed at the Events & Presentations section of the investor relations website.
About Tyler Technologies, Inc.
Tyler Technologies (NYSE: TYL) provides integrated software and technology services to the public sector. Tyler's end-to-end solutions empower local, state, and federal government entities to operate more efficiently and connect more transparently with their constituents and with each other. By connecting data and processes across disparate systems, Tyler's solutions are transforming how clients gain actionable insights that solve problems in their communities. Tyler has more than 37,000 successful installations across more than 12,000 locations, with clients in all 50 states, Canada, the Caribbean, Australia, and other international locations. Tyler has been recognized numerous times for growth and innovation, including Government Technology's GovTech 100 list and Forbes' "Most Innovative Growth Companies" list. More information about Tyler Technologies, an S&P 500 company headquartered in Plano, Texas, can be found at tylertech.com.
Non-GAAP Financial Measures
Tyler Technologies has provided in this press release financial measures that have not been prepared in accordance with generally accepted accounting principles (GAAP) and are therefore considered non-GAAP financial measures. This information includes non-GAAP revenues, non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating income, non-GAAP operating margin, non-GAAP net income, non-GAAP earnings per diluted share, EBITDA, adjusted EBITDA, and free cash flow. 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 Tyler’s ongoing operational performance because they provide additional insight in comparing results from period to period. Tyler believes 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. Non-GAAP financial measures discussed above exclude write-downs of acquisition-related deferred revenue, share-based compensation expense, employer portion of payroll taxes on employee stock transactions, expenses associated with amortization of intangibles arising from business combinations, acquisition-related expenses, and lease restructuring costs and other asset write-offs.
Tyler's non-GAAP tax rate for 2022 was 22.5% and for 2023 is 22.0%. This rate is based on Tyler's estimated annual GAAP income tax rate forecast, adjusted to account for items excluded from GAAP income in calculating Tyler's non-GAAP income, as well as significant non-recurring tax adjustments. The non-GAAP tax rate used in future periods will be reviewed periodically to determine whether it remains appropriate in consideration of factors including Tyler's periodic annual effective tax rate calculated in accordance with GAAP, changes resulting from tax legislation, changes in the geographic mix of revenues and expenses, and other factors deemed significant. Due to differences in tax treatment of items excluded from non-GAAP earnings, as well as the methodology applied to Tyler's estimated annual tax rate as described above, the estimated tax rate on non-GAAP income may differ from the GAAP tax rate and from Tyler's actual tax liabilities.
Non-GAAP financial measures should be considered in addition to, and not as a substitute for, or superior to, financial information prepared in accordance with GAAP. The non-GAAP measures used by Tyler Technologies may be different from non-GAAP measures used by other companies. Investors are encouraged to review the reconciliation of these non-GAAP measures to their most directly comparable GAAP financial measures, which has been provided in the financial statement tables included below in this press release.
Forward-looking Statements
This document contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 that are not historical in nature and typically address future or anticipated events, trends, expectations or beliefs with respect to our financial condition, results of operations or business. Forward-looking statements often contain words such as “believes,” “expects,” “anticipates,” “foresees,” “forecasts,” “estimates,” “plans,” “intends,” “continues,” “may,” “will,” “should,” “projects,” “might,” “could” or other similar words or phrases. Similarly, statements that describe our business strategy, outlook, objectives, plans, intentions or goals also are forward-looking statements. We believe there is a reasonable basis for our forward-looking statements, but they are inherently subject to risks and uncertainties and actual results could differ materially from the expectations and beliefs reflected in the forward-looking statements. We presently consider the following to be among the important factors that could cause actual results to differ materially from our expectations and beliefs: (1) the continuing effects of the COVID-19 pandemic, including its potential effects on the economic environment, our customers and our operations, as well as any changes to federal, state or local government laws, regulations or orders in connection with the pandemic; (2) changes in the budgets or regulatory environments of our clients, primarily local and state governments, that could negatively impact information technology spending; (3) disruption to our business and harm to our competitive position resulting from cyber-attacks and security vulnerabilities; (4) our ability to protect client information from security breaches and provide uninterrupted operations of data centers; (5) our ability to achieve growth or operational synergies through the integration of acquired businesses, while avoiding unanticipated costs and disruptions to existing operations; (6) material portions of our business require the internet infrastructure to be adequately maintained; (7) our ability to achieve our financial forecasts due to various factors, including project delays by our clients, reductions in transaction size, fewer transactions, delays in delivery of new products or releases or a decline in our renewal rates for service agreements; (8) general economic, political and market conditions, including inflation and changes in interest rates; (9) technological and market risks associated with the development of new products or services or of new versions of existing or acquired products or services; (10) competition in the industry in which we conduct business and the impact of competition on pricing, client retention and pressure for new products or services; (11) the ability to attract and retain qualified personnel and dealing with the loss or retirement of key members of management or other key personnel; and (12) costs of compliance and any failure to comply with government and stock exchange regulations. A detailed discussion of these factors and other risks that affect our business are described in our filings with the Securities and Exchange Commission, including the detailed “Risk Factors” contained in our most recent annual report on Form 10-K and quarterly report on Form 10-Q. We expressly disclaim any obligation to publicly update or revise our forward-looking statements.
(Comparative results follow)
#TYL_Financial
TYLER TECHNOLOGIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Amounts in thousands, except per share data)
(Unaudited)
Three Months Ended December 31,
Twelve Months Ended December 31,
2022
2021
2022
2021
Revenues:
Subscriptions
$
256,699
$
229,456
$
1,012,304
$
784,435
Maintenance
117,273
117,721
468,455
474,287
Professional services
55,315
53,790
243,117
209,391
Software licenses and royalties
7,622
19,242
59,406
74,452
Appraisal services
8,540
7,912
34,508
27,788
Hardware and other
6,771
5,416
32,414
21,934
Total revenues
452,220
433,537
1,850,204
1,592,287
Cost of revenues:
Subscriptions, maintenance and professional services
232,880
223,123
953,897
799,158
Software licenses and royalties
1,436
917
6,083
3,552
Amortization of software development
2,514
809
6,507
2,325
Amortization of acquired software
11,310
12,918
52,192
45,601
Appraisal services
6,293
5,509
23,988
19,061
Hardware and other
4,453
3,101
23,674
12,946
Total cost of revenues
258,886
246,377
1,066,341
882,643
Gross profit
193,334
187,160
783,863
709,644
Sales and marketing expense
34,969
33,176
135,743
118,624
General and administrative expense
66,883
67,860
267,324
271,955
Research and development expense
32,667
24,238
105,184
93,481
Amortization of other intangibles
18,104
13,834
61,363
44,849
Operating income
40,711
48,052
214,249
180,735
Interest expense
(8,103
)
(4,987
)
(28,379
)
(23,298
)
Other income, net
1,012
295
1,723
1,544
Income before income taxes
33,620
43,360
187,593
158,981
Income tax provision (benefit)
2,543
(11,422
)
23,353
(2,477
)
Net income
$
31,077
$
54,782
$
164,240
$
161,458
Earnings per common share:
Basic
$
0.75
$
1.33
$
3.95
$
3.95
Diluted
$
0.73
$
1.29
$
3.87
$
3.82
Weighted average common shares outstanding:
Basic
41,707
41,126
41,544
40,848
Diluted
42,419
42,536
42,399
42,244
TYLER TECHNOLOGIES, INC.
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
(Amounts in thousands, except per share data)
(Unaudited)
Three Months Ended December 31,
Twelve Months Ended December 31,
Reconciliation of non-GAAP total revenues
2022
2021
2022
2021
GAAP total revenues
$
452,220
$
433,537
$
1,850,204
$
1,592,287
Non-GAAP adjustments:
Add: Write-downs of acquisition-related deferred revenue
—
639
—
2,678
Non-GAAP total revenues
$
452,220
$
434,176
$
1,850,204
$
1,594,965
Three Months Ended December 31,
Twelve Months Ended December 31,
Reconciliation of non-GAAP gross profit and margin
2022
2021
2022
2021
GAAP gross profit
$
193,334
$
187,160
$
783,863
$
709,644
Non-GAAP adjustments:
Add: Write-downs of acquisition-related deferred revenue
—
639
—
2,678
Add: Share-based compensation expense included in cost of revenues
6,667
6,493
27,486
23,705
Add: Amortization of acquired software
11,310
12,918
52,192
45,601
Non-GAAP gross profit
$
211,311
$
207,210
$
863,541
$
781,628
GAAP gross margin
42.8
%
43.2
%
42.4
%
44.6
%
Non-GAAP gross margin
46.7
%
47.7
%
46.7
%
49.0
%
Three Months Ended December 31,
Twelve Months Ended December 31,
Reconciliation of non-GAAP operating income and margin
2022
2021
2022
2021
GAAP operating income
$
40,711
$
48,052
$
214,249
$
180,735
Non-GAAP adjustments:
Add: Write-downs of acquisition-related deferred revenue
—
639
—
2,678
Add: Share-based compensation expense
24,994
24,366
102,985
104,726
Add: Employer portion of payroll tax related to employee stock transactions
378
1,876
1,571
3,437
Add: Acquisition-related costs
757
777
1,971
23,495
Add: Lease restructuring costs and other asset write-offs
1,623
—
2,782
—
Add: Amortization of acquired software
11,310
12,918
52,192
45,601
Add: Amortization of customer and trade name intangibles
18,104
13,834
61,363
44,849
Non-GAAP adjustments subtotal
$
57,166
$
54,410
$
222,864
$
224,786
Non-GAAP operating income
$
97,877
$
102,462
$
437,113
$
405,521
GAAP operating margin
9.0
%
11.1
%
11.6
%
11.4
%
Non-GAAP operating margin
21.6
%
23.6
%
23.6
%
25.4
%
TYLER TECHNOLOGIES, INC.
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
(Amounts in thousands, except per share data)
(Unaudited)
Three Months Ended December 31,
Twelve Months Ended December 31,
Reconciliation of non-GAAP net income and earnings per share
2022
2021
2022
2021
GAAP net income
$
31,077
$
54,782
$
164,240
$
161,458
Non-GAAP adjustments:
Add: Total non-GAAP adjustments to operating income
57,166
54,410
222,864
224,786
Add: Acquisition-related costs in interest expense
—
—
—
6,407
Less: Tax impact related to non-GAAP adjustments
(17,884
)
(34,887
)
(68,999
)
(96,119
)
Non-GAAP net income
$
70,359
$
74,305
$
318,105
$
296,532
GAAP earnings per diluted share
$
0.73
$
1.29
$
3.87
$
3.82
Non-GAAP earnings per diluted share
$
1.66
$
1.75
$
7.50
$
7.02
Three Months Ended December 31,
Twelve Months Ended December 31,
Detail of share-based compensation expense
2022
2021
2022
2021
Subscriptions, maintenance and professional services
$
6,667
$
6,493
$
27,486
$
23,705
Sales and marketing expense
2,229
1,753
8,800
8,834
General and administrative expense
16,098
16,120
66,699
72,187
Total share-based compensation expense
$
24,994
$
24,366
$
102,985
$
104,726
Three Months Ended December 31,
Twelve Months Ended December 31,
Reconciliation of EBITDA and adjusted EBITDA
2022
2021
2022
2021
GAAP net income
$
31,077
$
54,782
$
164,240
$
161,458
Amortization of customer and trade name intangibles
18,104
13,834
61,363
44,849
Depreciation and amortization included in cost of revenues, sales and marketing expense, general and administrative expense, and research and development expense
22,627
22,360
89,890
77,651
Interest expense
8,103
4,987
28,379
23,298
Income tax provision (benefit)
2,543
(11,422
)
23,353
(2,477
)
EBITDA
$
82,454
$
84,541
$
367,225
$
304,779
Write-downs of acquisition-related deferred revenue
—
639
—
2,678
Share-based compensation expense
24,994
24,366
102,985
104,726
Acquisition-related costs
757
777
1,971
23,495
Lease restructuring costs and other asset write-offs
1,623
—
2,782
—
Adjusted EBITDA
$
109,828
$
110,323
$
474,963
$
435,678
Three Months Ended December 31,
Twelve Months Ended December 31,
Reconciliation of free cash flow
2022
2021
2022
2021
Net cash provided by operating activities
$
121,857
$
115,010
$
381,455
$
371,753
Less: additions to property and equipment
(5,088
)
(13,149
)
(22,529
)
(33,919
)
Less: investments in software development
(2,065
)
(6,727
)
(27,622
)
(21,693
)
Free cash flow
$
114,704
$
95,134
$
331,304
$
316,141
TYLER TECHNOLOGIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands)
(Unaudited)
December 31, 2022
December 31, 2021
ASSETS
Current assets:
Cash and cash equivalents
$
173,857
$
309,171
Accounts receivable, net
577,257
521,059
Short-term investments
37,030
52,300
Prepaid expenses and other current assets
59,098
63,664
Income tax receivable
—
18,137
Total current assets
847,242
964,331
Accounts receivable, long-term portion
8,271
13,937
Operating lease right-of-use assets
50,989
39,720
Property and equipment, net
172,786
181,193
Other assets:
Software development costs, net
48,189
28,489
Goodwill
2,489,308
2,359,674
Other intangibles, net
1,002,164
1,052,493
Non-current investments
18,508
46,353
Other non-current assets
49,960
45,971
Total assets
$
4,687,417
$
4,732,161
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities
$
236,754
$
278,412
Operating lease liabilities
10,736
10,560
Income tax payable
43,667
—
Deferred revenue
568,538
510,529
Current portion of term loans
30,000
30,000
Total current liabilities
889,695
829,501
Revolving line of credit
—
—
Term loans
362,905
718,511
Convertible senior notes due 2026, net
594,484
592,765
Deferred revenue, long-term
2,037
38
Deferred income taxes
148,891
228,085
Operating lease liabilities, long-term
48,049
36,336
Other long-term liabilities
16,967
2,893
Total liabilities
2,063,028
2,408,129
Shareholders' equity
2,624,389
2,324,032
Total liabilities and shareholders' equity
$
4,687,417
$
4,732,161
TYLER TECHNOLOGIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in thousands)
(Unaudited)
Three Months Ended December 31,
Twelve Months Ended December 31,
2022
2021
2022
2021
Cash flows from operating activities:
Net income
$
31,077
$
54,782
$
164,240
$
161,458
Adjustments to reconcile net income to cash provided by operations:
Depreciation and amortization
42,122
37,760
159,072
135,624
Losses from sale of investments
1
—
45
—
Share-based compensation expense
24,994
24,366
102,985
104,726
Provision for losses - accounts receivable
2,781
2,831
2,781
2,831
Operating lease right-of-use assets expense
3,729
3,200
12,969
10,216
Deferred income tax (benefit) expense
(54,347
)
2,410
(87,192
)
(13,271
)
Changes in operating assets and liabilities, exclusive of effects of acquired companies
71,500
(10,339
)
26,555
(29,831
)
Net cash provided by operating activities
121,857
115,010
381,455
371,753
Cash flows from investing activities:
Additions to property and equipment
(5,088
)
(13,149
)
(22,529
)
(33,919
)
Purchase of marketable security investments
(9,507
)
(1,766
)
(29,935
)
(77,450
)
Proceeds and maturities from marketable security investments
15,982
16,886
71,034
131,449
Investment in software development
(2,065
)
(6,727
)
(27,622
)
(21,693
)
Cost of acquisitions, net of cash acquired
(46,215
)
(1,312
)
(163,921
)
(2,089,706
)
Other
117
(79
)
443
384
Net cash used by investing activities
(46,776
)
(6,147
)
(172,530
)
(2,090,935
)
Cash flows from financing activities:
Decrease in net borrowings on revolving line of credit
—
—
—
—
Payment on term loans
(90,000
)
(87,500
)
(360,000
)
(145,000
)
Proceeds from term loans
—
—
—
900,000
Proceeds from issuance of convertible senior notes
—
—
—
600,000
Payment of debt issuance costs
—
—
—
(27,165
)
Purchase of treasury shares
—
(2
)
—
(12,977
)
Proceeds from exercise of stock options, net of withheld shares for taxes upon equity award
(1,188
)
50,281
(890
)
96,714
Contributions from employee stock purchase plan
4,037
3,401
16,651
13,158
Net cash (used) provided by financing activities
(87,151
)
(33,820
)
(344,239
)
1,424,730
Net (decrease) increase in cash and cash equivalents
(12,070
)
75,043
(135,314
)
(294,452
)
Cash and cash equivalents at beginning of period
185,927
234,128
309,171
603,623
Cash and cash equivalents at end of period
$
173,857
$
309,171
$
173,857
$
309,171
View source version on businesswire.com: https://www.businesswire.com/news/home/20230215005747/en/
Brian K. Miller
Executive Vice President & CFO
Tyler Technologies, Inc.
972-713-3720
brian.miller@tylertech.com
Source: Tyler Technologies
VIEW ALL NEWS
CONTACT US
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Brian Miller, EVP and CFO by phone 972.713.3720
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FORM 10-K
(Annual Report)
Filed 02/22/23 for the Period Ending 12/31/22
https://www.otcmarkets.com/filing/conv_pdf?id=16425151&guid=Cs4-kWJiMHfPdth
This board is attached to LIN
Linde plc,
LIN
2810 - Industrial Inorganic Chemicals Commodity Chemicals
not sure why it says LIN Media, Llc
Fiscal 2023 Financial Highlights
• Total billings increased 20 percent to $5.80 billion.
• Total revenue was $5.01 billion, an increase of 14 percent as reported, and 15 percent on a constant currency basis. Recurring revenue represents 98 percent of total.
• Design revenue was $4.26 billion, an increase of 13 percent as reported, and 14 percent on a constant currency basis.
• Make revenue was $452 million, an increase of 24 percent as reported, and 25 percent on a constant currency basis.
• Subscription plan revenue was $4.65 billion, an increase of 15 percent as reported and on a constant currency basis.
• Total subscriptions increased approximately 702 thousand from fiscal 2022 to 6.74 million at the end of fiscal 2023. Total subscriptions adjusted for the multi-user trade-in increased approximately 603 thousand from fiscal 2022 to 6.25 million.
• Subscription plan subscriptions increased 724 thousand from the end of fiscal 2022 to 6.74 million at the end of fiscal 2023.
• GAAP operating income was $989 million, compared to $618 million last year. GAAP operating margin was 20 percent, up 6 percentage points.
• Total non-GAAP operating income was $1.79 billion compared to $1.40 billion last year. Non-GAAP operating margin was 36 percent, up 4 percentage points.
• GAAP diluted net income per share was $3.78, compared to $2.24 last year.
• Non-GAAP diluted net income per share was $6.63, compared to $5.07 last year.
• Cash flow from operating activities increased to $2.07 billion, compared to $1.53 billion in fiscal 2022. Free cash flow increased to $2.03 billion, compared to $1.48 billion in fiscal 2022.
AUTODESK, INC.
FORM 8-K
(Current report filing)
Filed 02/23/23 for the Period Ending 02/23/23
https://www.otcmarkets.com/filing/conv_pdf?id=16428692&guid=Cs4-kWJiMHfPdth
AUTODESK, INC. ANNOUNCES FISCAL 2023 FOURTH QUARTER AND FULL-YEAR RESULTS
- Record quarterly and full-year revenue, cash flow from operating activities, and free cash flow
- Fourth quarter billings and current remaining performance obligations grew 28 percent and 12 percent year over year, respectively, to $2.1 billion and $3.5 billion
SAN FRANCISCO, FEBRUARY 23, 2023-- Autodesk, Inc. (NASDAQ: ADSK) today reported financial results for the fourth quarter and full year of fiscal 2023.
All growth rates are compared to the fourth quarter and full year of fiscal 2022, respectively, unless otherwise noted. A reconciliation of GAAP to non-GAAP results is provided in the accompanying tables. For definitions, please view the Glossary of Terms later in this document.
Fourth Quarter Fiscal 2023 Financial Highlights
• Total revenue increased 9 percent to $1.32 billion;
• GAAP operating margin was 21 percent, up 9 percentage points;
• Non-GAAP operating margin was 36 percent, up 1 percentage point;
• GAAP diluted EPS was $1.35; Non-GAAP diluted EPS was $1.86;
• Cash flow from operating activities was $911 million; free cash flow was $903 million.
“As we deliver next-generation technology and services to our customers, the pace of transformation within and between the industries we serve will accelerate, generating large new growth opportunities for Autodesk,” said Andrew Anagnost, Autodesk president and CEO. “We started seeing the shift towards connected digital workflows in the cloud in product design and manufacturing, then in architecture, followed by building engineering, and more recently construction. And we are now seeing growing momentum with owners.”
“Overall, the demand environment in Q4 remained consistent with Q3 with the approaching transition from up-front to annual billings for multi-year contracts, and a large renewal cohort, providing a tailwind to billings and free cash flow,” said Debbie Clifford, Autodesk CFO. “We continue to develop broader strategic partnerships with our customers, closing our largest deal to date during the quarter. Our strong momentum and competitive performance set us up well for fiscal 24.”
Fourth Quarter Fiscal 2023 Additional Financial Details
• Total billings increased 28 percent to $2.12 billion.
• Total revenue was $1.32 billion, an increase of 9 percent as reported, and 12 percent on a constant currency basis. Recurring revenue represents 98 percent of total.
• Design revenue was $1.11 billion, an increase of 9 percent as reported, and 12 percent on a constant currency basis. On a sequential basis, Design revenue increased 2 percent as reported and on a constant currency basis.
1
• Make revenue was $119 million, an increase of 20 percent as reported, and 21 percent on a constant currency basis. On a sequential basis, Make revenue increased 2 percent as reported and on a constant currency basis.
• Subscription plan revenue was $1.21 billion, an increase of 11 percent as reported, and 14 percent on a constant currency basis. On a sequential basis, subscription plan revenue increased 2 percent as reported and on a constant currency basis.
• Net revenue retention rate was within the range of 100 to 110 percent.
• GAAP operating income was $277 million, compared to $143 million in the fourth quarter last year. GAAP operating margin was 21 percent, up 9 percentage points.
• Total non-GAAP operating income was $479 million, compared to $421 million in the fourth quarter last year. Non- GAAP operating margin was 36 percent, up 1 percentage point.
• GAAP diluted net income per share was $1.35, compared to $0.40 in the fourth quarter last year.
• Non-GAAP diluted net income per share was $1.86, compared to $1.50 in the fourth quarter last year.
• Deferred revenue increased 21 percent to $4.58 billion. Unbilled deferred revenue was $1.04 billion, an increase of $94 million compared to the fourth quarter of last year. Remaining performance obligations (RPO) increased 19 percent to $5.62 billion. Current RPO increased 12 percent to $3.52 billion.
• Cash flow from operating activities was $911 million, an increase of $189 million compared to the fourth quarter last year. Free cash flow was $903 million, an increase of $187 million compared to the fourth quarter last year.
BOOKING HOLDINGS INC.
FORM 10-K
(Annual Report)
Filed 02/23/23 for the Period Ending 12/31/22
https://www.otcmarkets.com/filing/conv_pdf?id=16429964&guid=714-kpJOCvd-B3h
ATSG REPORTS STRONG SECOND QUARTER 2022 RESULTS
https://www.atsginc.com/investors/news-and-events/ir-press-releases/atsg-reports-strong-second-quarter-2022-results
ATSG Reports Record 2022 Revenues
Source: Business Wire
Projects record freighter deliveries in 2023 and 2024
Air Transport Services Group, Inc. (Nasdaq: ATSG), the leading provider of medium wide-body aircraft leasing, contracted air transportation, and related services, today reported consolidated financial results for the quarter and year ended December 31, 2022.
Fourth Quarter Results
Revenues $533 million, up 11%
GAAP EPS (basic) from Continuing Operations $0.58, down $0.02 on GAAP Pretax Earnings from Continuing Operations $61.2 million, up 1%
Adjusted Pretax* Earnings $65 million, up 16%
Adjusted EPS* $0.53, up $0.03
Adjusted EBITDA* $163 million, up 5%
Full Year 2022 Results
Revenues $2.0 billion, up 18%
GAAP EPS (basic) from Continuing Operations $2.67, down $0.66 on GAAP Pretax Earnings from Continuing Operations $260 million, down 14%
Adjusted Pretax Earnings* $263 million, up 51%
Adjusted EPS* $2.28, up $0.67 or 42%
Adjusted EBITDA* $641 million, up $100 million or 18%
Operating Cash Flows $472 million and Adjusted Free Cash Flow* $285 million
Rich Corrado, president and chief executive officer of ATSG, said, "In 2022, our revenues and Adjusted EBITDA each grew 18%, with revenues reaching a record $2 billion, and Adjusted EBITDA increasing $100 million to $641 million. Our Adjusted Pretax Earnings also grew sharply, excluding 2021 benefits from pandemic related government grants for our passenger airline. At the same time, we invested nearly $600 million in our businesses which will allow us to take advantage of the continued attractive leasing market for midsize freighter aircraft. I expect those investments and the outstanding performance of our employees to drive even more robust growth and earnings in the years to come."
2022 Operating Highlights
Six more dry leases of Boeing 767-300 freighters, plus one re-lease and four lease extensions of Boeing 767-200s. Two of the six newly converted 767-300 freighters leased last year are also being operated by ATSG’s airlines under Crew, Maintenance and Insurance (CMI) agreements.
Seven more customer-provided 767 freighters were subleased to and operated by ATSG’s cargo airlines during 2022, totaling thirteen such aircraft in the fleet at the end of the year.
Feedstock aircraft secured for the twenty freighters ATSG expects to lease in 2023.
Completed a strong schedule of passenger airline missions for government customers, including the resumption of a full schedule of combi service worldwide for the Department of Defense.
Executed a six-year extension and expansion of ATSG’s longstanding commercial relationship with DHL. The number of 767s our airline operates for DHL has more than doubled since the beginning of 2021.
2022 Financial Highlights
Record revenue of $2.0 billion in 2022, an increase of $311 million from 2021, due primarily to a full year of contributions from 2021’s fifteen new leases of 767-300s and seven more aircraft in CMI service.
$641 million in Adjusted EBITDA for 2022, up $100 million. Adjusted EBITDA for 2021 excluded $112 million in proceeds from federal grant awards to ATSG’s passenger airline, Omni Air, under U.S. government programs created to support jobs among passenger carriers during severe cutbacks in passenger flying during the pandemic.
Growth investments of $413 million. These investments supported current and projected 20 or more freighter lease deployments in each of 2023 and 2024.
Repurchases of 2 million ATSG common shares. ATSG’s Board of Directors approved a new $150 million share repurchase authorization in November 2022. Shares repurchased in 2022, all in the fourth quarter, represented nearly 3% of the 74 million shares outstanding at the beginning of 2022.
* Adjusted EPS (Earnings per Share), Adjusted Pretax Earnings, Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) and Adjusted Free Cash Flow are non-GAAP financial measures and are defined and reconciled to GAAP measures at the end of this release.
Segment Results
Cargo Aircraft Management (CAM)
Aircraft leasing and related revenues from external customers were up 3% for the fourth quarter and 17% for the year, reflecting the 2022 benefit of a full year of revenues from fifteen Boeing 767-300 freighters leased during 2021, plus partial-year revenues from six other 767-300s leased in 2022.
CAM’s fourth-quarter pretax earnings decreased 7% to $31 million versus the prior-year quarter, but increased 35% for the year. Fourth quarter 2021 earnings benefited from the sale of aircraft assets.
Ninety-one CAM-owned 767 freighter aircraft were leased to external customers, six more than a year ago.
Twenty-two CAM-owned aircraft were in or awaiting conversion to freighters, nine more than a year ago.
ACMI Services
Pretax earnings were $26 million in the fourth quarter, versus $34 million in 2021. Full-year pretax earnings were $95 million for 2022 and $159 million in 2021. Results in 2021 included a $15 million contribution from federal pandemic-related grants for ATSG’s cargo airline in the fourth quarter, and $112 million for the year. Excluding grant contributions, ACMI Services pretax earnings increased 33% for the quarter and more than doubled for the year.
Revenue block hours for ATSG's airlines increased 1% for the fourth quarter and 8% for 2022 over 2021. The increase for 2022 included the benefit of seven more aircraft in service than a year ago. Cargo block hours increased 2% for the fourth quarter and 9% for the year. Passenger block hours were down 2% for the quarter and up 4% for the year.
2023 Outlook
ATSG expects its Adjusted EBITDA for 2023 to increase to a range of $650 million to $660 million. ATSG expects 2023 full year Adjusted EPS to decline to a range of $1.85 to $2.00, based on 2023 projections for higher interest expense and inflationary effects, as well as reduced ACMI Services operations.
The Adjusted EBITDA and Adjusted EPS forecasts for 2023 assume:
Fewer operating block hours for ATSG airlines in 2023 versus 2022 for both our cargo and passenger operations.
Workforce retention and training effects, principally at our airlines and in maintenance services.
Dry leases of fourteen Boeing 767-300s, and six Airbus A321-200 freighters currently awaiting approval by the foreign regulatory agencies, which is anticipated by mid-year.
Leases for eight Boeing 767-200s are due to expire between May and September 2023. CAM expects to remove from service three of the eight due to airframe cycle limitations, and utilize their engines to support other 767-200 lease customers. The remaining five aircraft will be sold or re-leased.
A full year of contributions from seven 767-300 freighter aircraft that customers own or lease from other companies, and have assigned to our cargo airlines to operate during 2022, and the partial year contributions of three more 767-300 freighter aircraft to be added in 2023.
Corrado said that ATSG’s aircraft leasing operations, including its engine maintenance services, are expected to generate substantially more Adjusted EBITDA over the next five years. But reductions in ACMI Services segment's operations in 2023 will limit its growth this year.
"Growth in e-commerce, particularly outside the U.S., is driving the growth of air express networks around the world. That trend, and replacement of older cargo aircraft postponed during the pandemic, are compelling drivers for growth in our leasing demand," Corrado said.
2023 will be an investment year for ATSG. Capital spending for the year is projected to be $850 million, including $260 million in sustaining capex and $590 million for growth. In 2023, CAM will begin the passenger-to-freighter conversion of the first two of its A330-300s for lease delivery in 2024. CAM expects to convert and lease thirty such aircraft by 2028, two-thirds of which are already backed by customer commitments. CAM will also begin conversion of a projected sixteen 767-300 freighters it expects to lease in 2024. We already have customer commitments for virtually all of those freighters.
“We plan to deliver 20 newly converted aircraft during 2023 and more in 2024, as customer lease deployments are expanded to include the Airbus A330," Corrado said. "These deliveries are projected to significantly grow Adjusted EBITDA in 2024 and 2025, and solidify our position as the world's largest lessor of main deck freighters. Our employees are prepared to execute on our plans and exciting opportunities to generate long-term attractive returns for shareholders."
Non-GAAP Financial Measures
This release, including the attached non-GAAP Reconciliation tables, contains financial measures that are not calculated and presented in accordance with generally accepted accounting principles in the United States ("non-GAAP financial measures"). Management uses these non-GAAP financial measures to evaluate historical results and project future results. Management believes that these non-GAAP financial measures assist in highlighting operational trends, facilitating period-over-period comparisons, and providing additional clarity about events and trends affecting core operating performance. Disclosing these non-GAAP financial measures provides insight to investors about additional metrics that management uses to evaluate past performance and prospects for future performance. Non-GAAP measures should not be considered in isolation or as a substitute for analysis of the Company's results as reported under GAAP and may be calculated differently by other companies.
The historical non-GAAP financial measures included in this release are reconciled to the most directly comparable financial measure calculated and presented in accordance with GAAP in the non-GAAP Reconciliation tables included later in this release. The Company does not provide a reconciliation of projected Adjusted EBITDA or Adjusted EPS because it is unable to predict with reasonable accuracy the value of certain adjustments. Certain adjustments can be significantly impacted by the re-measurements of financial instruments including stock warrants issued to a customer. The Company’s earnings on a GAAP basis, including its earnings per share on a GAAP basis, and the non-GAAP adjustments for gains and losses resulting from the re-measurement of stock warrants, will depend on the future prices of ATSG stock, interest rates, and other assumptions which are highly uncertain.
Conference Call
ATSG will host an investor conference call on Friday, February 24, 2023, at 10 a.m. Eastern Time to review its financial results for the fourth quarter of 2022, and its outlook for 2023. Live call participants must register via this link, which is also available at ATSG’s website, www.atsginc.com under “Investors” and “Presentations.” Once registered, call participants will receive dial-in numbers and a unique Personal Identification Number (PIN) that must be entered to join the live call. Listen-only access to live and replay versions of the call, including slides, will be available via a webcast link at the same ATSG website location. Slides that accompany management’s discussion of fourth-quarter results may be downloaded there shortly before the start of the call at 10 a.m.
About ATSG
ATSG is a leading provider of aircraft leasing and air cargo transportation and related services to domestic and foreign air carriers and other companies that outsource their air cargo lift requirements. ATSG, through its leasing and airline subsidiaries, is the world's largest owner and operator of converted Boeing 767 freighter aircraft. Through its principal subsidiaries, including three airlines with separate and distinct U.S. FAA Part 121 Air Carrier certificates, ATSG provides aircraft leasing, air cargo lift, passenger ACMI and charter services, aircraft maintenance services and airport ground services. ATSG's subsidiaries include ABX Air, Inc.; Airborne Global Solutions, Inc.; Airborne Maintenance and Engineering Services, Inc., including its subsidiary, Pemco World Air Services, Inc.; Air Transport International, Inc.; Cargo Aircraft Management, Inc.; and Omni Air International, LLC. For more information, please see www.atsginc.com.
Except for historical information contained herein, the matters discussed in this release contain forward-looking statements that involve risks and uncertainties. A number of important factors could cause Air Transport Services Group, Inc.'s ("ATSG's") actual results to differ materially from those indicated by such forward-looking statements. These factors include, but are not limited to: (i) unplanned changes in the market demand for our assets and services, including the loss of customers or a reduction in the level of services we perform for customers; (ii) our operating airlines' ability to maintain on-time service and control costs; (iii) the cost and timing with respect to which we are able to purchase and modify aircraft to a cargo configuration; (iv) fluctuations in ATSG's traded share price and in interest rates, which may result in mark-to-market charges on certain financial instruments; (v) the number, timing, and scheduled routes of our aircraft deployments to customers; (vi) our ability to remain in compliance with key agreements with customers, lenders and government agencies; (vii) the impact of current supply chain constraints both within and outside the United States, which may be more severe or persist longer than we currently expect; (viii) the impact of a competitive labor market, which could restrict our ability to fill key positions; (ix) changes in general economic and/or industry-specific conditions; and (x) factors relating to the COVID-19 pandemic, including that the pandemic may (a) continue for a longer period, or its effect on commercial and military passenger flying may be more substantial than we currently expect; (b) cause disruptions to our workforce and staffing capability, including through our compliance with COVID-19 vaccination and testing requirements; (c) cause disruptions in our ability to access airports and maintenance facilities; and (d) adversely impact our customers' creditworthiness or the ability of our vendors and third-party service providers to maintain customary service levels. Other factors that could cause ATSG’s actual results to differ materially from those indicated by such forward-looking statements are contained from time to time in ATSG's filings with the U.S. Securities and Exchange Commission, including its annual report on Form 10-K and quarterly reports on Form 10-Q. Readers should carefully review this release and should not place undue reliance on ATSG's forward-looking statements. These forward-looking statements were based on information, plans and estimates as of the date of this release. Except as may be required by applicable law, ATSG undertakes no obligation to update any forward-looking statements to reflect changes in underlying assumptions or factors, new information, future events or other changes.
AIR TRANSPORT SERVICES GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (UNAUDITED)
(In thousands, except per share data)
Three Months Ended
Year Ended
December 31,
December 31,
2022
2021
2022
2021
REVENUES
$
533,025
$
482,367
$
2,045,469
$
1,734,282
OPERATING EXPENSES
Salaries, wages and benefits
172,424
159,666
666,950
591,280
Depreciation and amortization
84,338
84,013
331,064
308,448
Maintenance, materials and repairs
45,465
41,693
162,122
173,364
Fuel
73,432
56,390
275,512
173,600
Contracted ground and aviation services
20,264
20,507
77,026
75,724
Travel
29,445
24,768
111,989
86,601
Landing and ramp
3,710
4,082
16,583
14,244
Rent
8,323
6,294
30,437
23,695
Insurance
2,442
3,206
9,666
12,588
Other operating expenses
20,669
16,801
78,637
65,179
Government grants
—
(15,047
)
—
(111,673
)
460,512
402,373
1,759,986
1,413,050
OPERATING INCOME
72,513
79,994
285,483
321,232
OTHER INCOME (EXPENSE)
Interest income
335
3
415
39
Non-service component of retiree benefit credits
4,635
4,457
20,046
17,827
Debt issuance costs
—
—
—
(6,505
)
Net gain (loss) on financial instruments
(380
)
(7,818
)
9,022
29,979
Losses from non-consolidated affiliates
(2,030
)
(1,212
)
(7,607
)
(2,577
)
Interest expense
(13,834
)
(14,788
)
(46,861
)
(58,790
)
(11,274
)
(19,358
)
(24,985
)
(20,027
)
EARNINGS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES
61,239
60,636
260,498
301,205
INCOME TAX EXPENSE
(18,995
)
(16,178
)
(64,060
)
(72,225
)
EARNINGS FROM CONTINUING OPERATIONS
42,244
44,458
196,438
228,980
EARNINGS FROM DISCONTINUED OPERATIONS, NET OF TAX
407
66
2,143
2,440
NET EARNINGS
$
42,651
$
44,524
$
198,581
$
231,420
EARNINGS PER SHARE - CONTINUING OPERATIONS
Basic
$
0.58
$
0.60
$
2.67
$
3.33
Diluted
$
0.50
$
0.57
$
2.26
$
2.80
WEIGHTED AVERAGE SHARES - CONTINUING OPERATIONS
Basic
72,590
73,826
73,611
68,853
Diluted1
86,380
77,366
88,324
76,216
1 Due to adopting accounting standard ASU No. 2020-06, "Accounting for Convertible Instruments and Contracts in an Entity's Own Equity" on January 1, 2022 using the modified retrospective method, 8,111 shares were added to the diluted weighted average shares for 2022 under the "if-convert method" for the Company's convertible note.
AIR TRANSPORT SERVICES GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(In thousands, except share data)
December 31,
2022
December 31,
2021
ASSETS
CURRENT ASSETS:
Cash and cash equivalents
$
27,134
$
69,496
Accounts receivable, net of allowance of $939 in 2022 and $742 in 2021
301,622
205,399
Inventory
57,764
49,204
Prepaid supplies and other
31,956
28,742
TOTAL CURRENT ASSETS
418,476
352,841
Property and equipment, net
2,402,408
2,129,934
Customer incentive
79,650
102,913
Goodwill and acquired intangibles
492,642
505,125
Operating lease assets
74,070
62,644
Other assets
122,647
113,878
TOTAL ASSETS
$
3,589,893
$
3,267,335
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable
$
192,992
$
174,237
Accrued salaries, wages and benefits
56,498
56,652
Accrued expenses
12,466
14,950
Current portion of debt obligations
639
628
Current portion of lease obligations
23,316
18,783
Unearned revenue and grants
21,546
47,381
TOTAL CURRENT LIABILITIES
307,457
312,631
Long term debt
1,464,285
1,298,735
Stock warrant obligations
695
915
Post-retirement obligations
35,334
21,337
Long term lease obligations
51,575
44,387
Other liabilities
62,861
49,662
Deferred income taxes
255,180
217,291
STOCKHOLDERS’ EQUITY:
Preferred stock, 20,000,000 shares authorized, including 75,000 Series A Junior Participating Preferred Stock
—
—
Common stock, par value $0.01 per share; 150,000,000 shares authorized; 72,327,758 and 74,142,183 shares issued and outstanding in 2022 and 2021, respectively
723
741
Additional paid-in capital
986,303
1,074,286
Retained earnings
528,882
309,430
Accumulated other comprehensive loss
(103,402
)
(62,080
)
TOTAL STOCKHOLDERS’ EQUITY
1,412,506
1,322,377
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
$
3,589,893
$
3,267,335
AIR TRANSPORT SERVICES GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED SUMMARY OF CASH FLOWS (UNAUDITED)
(In thousands)
Three Months Ended
Year Ended
December 31,
December 31,
2022
2021
2022
2021
OPERATING CASH FLOWS
$
74,050
$
154,319
$
472,120
$
583,557
INVESTING ACTIVITIES:
Aircraft acquisitions and freighter conversions
(109,636
)
(43,078
)
(412,595
)
(321,644
)
Planned aircraft maintenance, engine overhauls and other non-aircraft additions to property and equipment
(41,437
)
(33,544
)
(186,836
)
(183,104
)
Proceeds from property and equipment
12,154
15,903
15,913
19,427
Acquisitions and investments in businesses
(312
)
—
(16,545
)
(2,155
)
TOTAL INVESTING CASH FLOWS
(139,231
)
(60,719
)
(600,063
)
(487,476
)
FINANCING ACTIVITIES:
Principal payments on debt
(20,103
)
(142,293
)
(365,628
)
(1,900,311
)
Proceeds from borrowings
115,000
70,000
625,000
1,500,600
Proceeds from bond issuance
—
—
—
207,400
Payments for financing costs
(1,803
)
—
(1,803
)
(3,099
)
Proceeds from issuance of warrants
—
—
—
131,967
Bond Repurchase
—
—
(115,204
)
—
Purchase of common stock
(53,868
)
—
(53,868
)
—
Taxes paid for conversion of employee awards
(1,397
)
(1,619
)
(2,916
)
(2,861
)
TOTAL FINANCING CASH FLOWS
37,829
(73,912
)
85,581
(66,304
)
NET INCREASE (DECREASE) IN CASH
$
(27,352
)
$
19,688
$
(42,362
)
$
29,777
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD
$
54,486
$
49,808
$
69,496
$
39,719
CASH AND CASH EQUIVALENTS AT END OF PERIOD
$
27,134
$
69,496
$
27,134
$
69,496
AIR TRANSPORT SERVICES GROUP, INC. AND SUBSIDIARIES
PRETAX EARNINGS FROM CONTINUING OPERATIONS AND ADJUSTED PRETAX EARNINGS SUMMARY
NON-GAAP RECONCILIATION
(In thousands)
Three Months Ended
Year Ended
December 31,
December 31,
2022
2021
2022
2021
Revenues
CAM
Aircraft leasing and related revenues
$
113,640
$
110,514
$
454,804
$
390,327
Lease incentive amortization
(5,029
)
(5,029
)
(20,118
)
(20,040
)
Total CAM
108,611
105,485
434,686
370,287
ACMI Services
369,385
333,790
1,404,348
1,185,128
Other Activities
111,489
94,345
430,326
375,571
Total Revenues
589,485
533,620
2,269,360
1,930,986
Eliminate internal revenues
(56,460
)
(51,253
)
(223,891
)
(196,704
)
Customer Revenues
$
533,025
$
482,367
$
2,045,469
$
1,734,282
Pretax Earnings (Loss) from Continuing Operations
CAM, inclusive of interest expense
31,421
33,643
143,008
106,161
ACMI Services, inclusive of government grants and interest expense
25,931
34,487
95,198
158,733
Other Activities
2,019
(2,391
)
2,579
112
Net, unallocated interest expense
(357
)
(530
)
(1,748
)
(2,525
)
Non-service components of retiree benefit credit
4,635
4,457
20,046
17,827
Debt issuance costs
—
—
—
(6,505
)
Net gain (loss) on financial instruments
(380
)
(7,818
)
9,022
29,979
Loss from non-consolidated affiliates
(2,030
)
(1,212
)
(7,607
)
(2,577
)
Earnings from Continuing Operations before Income Taxes (GAAP)
$
61,239
$
60,636
$
260,498
$
301,205
Adjustments to Pretax Earnings from Continuing Operations
Add customer incentive amortization
5,821
5,799
23,263
23,094
Add loss from non-consolidated affiliates
2,030
1,212
7,607
2,577
Less net (gain) loss on financial instruments
380
7,818
(9,022
)
(29,979
)
Less non-service components of retiree benefit credit
(4,635
)
(4,457
)
(20,046
)
(17,827
)
Less government grants
—
(15,047
)
—
(111,673
)
Add debt issuance costs
—
—
—
6,505
Add net charges for hangar foam incident
18
—
978
—
Adjusted Pretax Earnings (non-GAAP)
$
64,853
$
55,961
$
263,278
$
173,902
Adjusted Pretax Earnings excludes certain items included in GAAP-based pretax Earnings (Loss) from Continuing Operations before Income Taxes because these items are distinctly different in their predictability among periods or not closely related to our operations. Presenting this measure provides investors with a comparative metric of fundamental operations, while highlighting changes to certain items among periods. Adjusted Pretax Earnings should not be considered an alternative to Earnings from Continuing Operations Before Income Taxes or any other performance measure derived in accordance with GAAP.
AIR TRANSPORT SERVICES GROUP, INC. AND SUBSIDIARIES
ADJUSTED EARNINGS FROM CONTINUING OPERATIONS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION
NON-GAAP RECONCILIATION
(In thousands)
Three Months Ended
Year Ended
December 31,
December 31,
2022
2021
2022
2021
Earnings (Loss) from Continuing Operations Before Income Taxes
$
61,239
$
60,636
$
260,498
$
301,205
Interest Income
(335
)
(3
)
(415
)
(39
)
Interest Expense
13,834
14,788
46,861
58,790
Depreciation and Amortization
84,338
84,013
331,064
308,448
EBITDA from Continuing Operations (non-GAAP)
$
159,076
$
159,434
$
638,008
$
668,404
Add customer incentive amortization
5,821
5,799
23,263
23,094
Add start-up loss from non-consolidated affiliates
2,030
1,212
7,607
2,577
Less net (gain) loss on financial instruments
380
7,818
(9,022
)
(29,979
)
Add non-service components of retiree benefit credits
(4,635
)
(4,457
)
(20,046
)
(17,827
)
Less government grants
—
(15,047
)
—
(111,673
)
Less debt issuance costs
—
—
—
6,505
Add net charges for hangar foam incident
18
—
978
—
Adjusted EBITDA (non-GAAP)
$
162,690
$
154,759
$
640,788
$
541,101
Management uses Adjusted EBITDA to assess the performance of its operating results among periods. It is a metric that facilitates the comparison of financial results of underlying operations. Additionally, these non-GAAP adjustments are similar to the adjustments used by lenders in the Company’s senior secured credit facility to assess financial performance and determine the cost of borrowed funds. The adjustments also remove the non-service cost components of retiree benefit plans because they are not closely related to ongoing operating activities. To improve comparability between periods, the adjustments also exclude from EBITDA from Continuing Operations the recognition of government grants and charges related to the discharge of a fire suppression system in the Company's aircraft hangar, net of related insurance recoveries. Management presents EBITDA from Continuing Operations, a commonly referenced metric, as a subtotal toward computing Adjusted EBITDA.
EBITDA from Continuing Operations is defined as Earnings (Loss) from Continuing Operations Before Income Taxes plus net interest expense, depreciation, and amortization expense. Adjusted EBITDA is defined as EBITDA from Continuing Operations less financial instrument revaluation gains or losses, non-service components of retiree benefit costs including pension plan settlements, amortization of warrant-based customer incentive costs recorded in revenue, recognition of government grants, impairment of aircraft and related assets, charge off of debt issuance costs upon debt restructuring, costs from non-consolidated affiliates and charges related to the discharge of a fire suppression system, net of insurance recoveries.
AIR TRANSPORT SERVICES GROUP, INC. AND SUBSIDIARIES
ADJUSTED FREE CASH FLOW
NON-GAAP RECONCILIATION
(In thousands)
Three Months Ended
Year Ended
December 31,
December 31,
2022
2021
2022
2021
OPERATING CASH FLOWS (GAAP)
$
74,050
$
154,319
$
472,120
$
583,557
Sustaining capital expenditures
(41,437
)
(33,544
)
(186,836
)
(183,104
)
ADJUSTED FREE CASH FLOW (non-GAAP)
$
32,613
$
120,775
$
285,284
$
400,453
Sustaining capital expenditures includes cash outflows for planned aircraft maintenance, engine overhauls, information systems and other non-aircraft additions to property and equipment. It does not include expenditures for aircraft acquisitions and related passenger-to-freighter conversion costs.
Cash receipts from government payroll support programs, which are included in operating cash flows, were $0 and $83.0 million for the years ended December 31, 2022 and 2021, respectively.
Adjusted Free Cash Flow (non-GAAP) includes cash flow from operations net of expenditures for planned aircraft maintenance, engine overhauls and other non-aircraft additions to property and equipment. Management believes that adjusting GAAP operating cash flows is useful for investors to evaluate the company's ability to generate adjusted free cash flow for growth initiatives, debt service, cash returns for shareholders or other discretionary allocations of capital.
AIR TRANSPORT SERVICES GROUP, INC. AND SUBSIDIARIES
ADJUSTED EARNINGS AND ADJUSTED EARNINGS PER SHARE
NON-GAAP RECONCILIATION
(In thousands)
Management presents Adjusted Earnings and Adjusted Earnings Per Share, both non-GAAP measures, to provide additional information regarding earnings per share without the volatility otherwise caused by the items below among periods.
Three Months Ended
Year Ended
December 31, 2022
December 31, 2021
December 31, 2022
December 31, 2021
$
$ Per
Share
$
$ Per
Share
$
$ Per
Share
$
$ Per
Share
Earnings from Continuing Operations - basic (GAAP)
$
42,244
$
44,458
$
196,438
$
228,980
Gain from warrant revaluation, net tax1
(15
)
—
(170
)
(15,564
)
Convertible notes interest charges, net of tax 2
766
—
3,051
—
Earnings (Loss) from Continuing Operations - diluted (GAAP)
42,995
$
0.50
44,458
$
0.57
199,319
$
2.26
213,416
$
2.80
Adjustments, net of tax
Customer incentive amortization3
4,492
0.05
4,475
0.06
17,953
0.20
17,823
0.23
Effects of government grants4
—
—
(11,613
)
(0.15
)
—
—
(86,187
)
(1.13
)
Non-service component of retiree benefits5
(3,577
)
(0.04
)
(3,440
)
(0.04
)
(15,470
)
(0.18
)
(13,759
)
(0.18
)
Debt issuance costs6
—
—
—
—
—
—
5,020
0.07
Derivative and warrant revaluation7
309
—
6,034
0.07
(6,793
)
(0.08
)
(7,573
)
(0.16
)
Loss from affiliates8
1,567
0.02
935
0.01
5,871
0.07
1,988
0.03
Convertible debt interest charges (prior period), net of tax2
—
—
2,372
(0.02
)
—
—
9,390
(0.05
)
Hangar foam incident9
14
—
—
—
755
0.01
—
—
Adjusted Earnings and Adjusted Earnings Per Share (non-GAAP)
$
45,800
$
0.53
$
43,221
$
0.50
$
201,635
$
2.28
$
140,118
$
1.61
Shares
Shares
Shares
Shares
Weighted Average Shares - diluted
86,380
77,366
88,324
76,216
Additional shares - warrants 1
—
1,635
—
2,680
Additional shares - convertible notes 2
—
8,111
—
8,111
Adjusted Shares (non-GAAP)
86,380
87,112
88,324
87,007
This presentation does not give effect to convertible note hedges the Company purchased having the same number of the Company's common shares, 8.1 million shares, and the same strike price of $31.90, that underlie the Convertible Notes. The convertible note hedges are expected to reduce the potential equity dilution with respect to the Company's common stock upon conversion of the Convertible Notes.
Adjusted Earnings and Adjusted Earnings Per Share should not be considered as alternatives to Earnings from Continuing Operations, Weighted Average Shares - diluted or Earnings Per Share from Continuing Operations or any other performance measure derived in accordance with GAAP. Adjusted Earnings and Adjusted Earnings Per Share should not be considered in isolation or as a substitute for analysis of the company's results as reported under GAAP.
1.
Under U.S. GAAP, certain warrants are reflected as a liability and unrealized warrant gains are typically removed from diluted earnings per share (“EPS”) calculations, while unrealized warrant losses are not removed because they are dilutive to EPS. For all periods presented, additional shares assumes that Amazon net settled its remaining warrants during each period.
2.
Application of accounting standard ASU No. 2020-06, "Accounting for Convertible Instruments and Contracts in an Entity's Own Equity" was adopted prospectively for EPS calculations on January 1, 2022 using the modified retrospective approach. The updated GAAP requires convertible debt to be treated under the "if-convert method" for EPS. Periods prior to adoption include adjustments to reflect EPS as if the new standard had been applied historically for comparability purposes.
3.
Removes the amortization of the warrant-based customer incentives which are recorded against revenue over the term of the related aircraft leases and customer contracts.
4.
Removes the effects of government grants received under federal payroll support programs.
5.
Removes the non-service component of post-retirement costs and credits.
6.
Removes the charge off of debt issuance costs when the Company modified its debt structure.
7.
Removes gains and losses from financial instruments, including derivative interest rate instruments and warrant revaluations.
8.
Removes losses for the Company's non-consolidated affiliates.
9.
Removes charges related to the discharge of a fire suppression system in the Company's aircraft hangar, net of related insurance recoveries.
AIR TRANSPORT SERVICES GROUP, INC. AND SUBSIDIARIES
AIRCRAFT FLEET
Aircraft Types
December 31, 2021
December 31, 2022
December 31, 2023
Projected
Freighter
Passenger
Freighter
Passenger
Freighter
Passenger
B767-200
33
3
32
3
24
3
B767-300
65
9
78
8
94
8
B777-200
—
3
—
3
—
3
B757-200
—
—
—
—
—
—
B757 Combi
—
4
—
4
—
4
A321-200
—
—
—
—
6
—
Total Aircraft in Service
98
19
110
18
124
18
B767-300 in or awaiting cargo conversion
12
—
15
—
13
—
A321 in cargo conversion
1
—
7
—
5
—
A330 in cargo conversion
—
—
—
—
3
—
B767-200 staging for lease
1
—
—
—
2
—
Total Aircraft
112
19
132
18
147
18
Aircraft in Service Deployments
December 31,
December 31,
December 31,
2021
2022
2023 Projected
Dry leased without CMI
35
39
55
Dry leased with CMI
50
52
47
Customer provided for CMI
6
13
16
ACMI/Charter1
26
24
24
1.
ACMI/Charter includes four Boeing 767 passenger aircraft leased from external companies.
View source version on businesswire.com: https://www.businesswire.com/news/home/20230223005991/en/
Quint Turner, ATSG Inc. Chief Financial Officer
937-366-2303
The last filing shows $45 million in cash and the stock trades at a Market cap 6,384,943 02/21/2023
WETOUCH TECHNOLOGY INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
As of September 30, 2022
https://www.otcmarkets.com/filing/conv_pdf?id=16199207&guid=he7-keSHJM22dth
WETH SECURITY DETAILS
Share Structure
Market Cap Market Cap
6,384,943
02/21/2023
Authorized Shares
300,000,000
02/21/2023
Outstanding Shares
33,604,965
02/21/2023
Restricted
14,846,935
02/21/2023
Unrestricted
18,758,030
02/21/2023
Held at DTC
2,400,272
02/21/2023
Float
28,507,913
03/01/2022
Par Value
0.001
Prospect Capital Announces December 2022 Results: $0.23 per Common Share Basic Net Investment Income and Stable Monthly $0.06 per Common Share Distributions
Source: GlobeNewswire Inc.
Prospect Capital Corporation (NASDAQ: PSEC) (“Prospect”, “our”, or “we”) today announced financial results for our fiscal quarter ended December 31, 2022.
FINANCIAL RESULTS
All amounts in $000’s except
per share amounts (on weighted average
basis for period numbers) Quarter Ended
December 31, 2022 Quarter Ended
September 30, 2022 Quarter Ended
December 31, 2021
Net Investment Income (“NII”) $106,704 $99,266 $85,557
Basic NII per Common Share(1) $0.23 $0.22 $0.20
Interest as % of Total Investment Income 89.6% 86.0% 81.1%
Basic NII Coverage of Distributions to Common Shareholders 128% 122% 111%
Annualized Basic NII Return on Common NAV 9.3% 8.8% 7.5%
Net Income (Loss) Applicable to Common Stockholders $55,623 $(105,199) $246,411
Basic Net Income (Loss) per Common Share(2) $0.14 $(0.27) $0.63
Distributions to Common Shareholders $71,670 $71,072 $70,240
Distributions per Common Share $0.18 $0.18 $0.18
Since Oct 2017 Basic NII per Common Share(1) $4.20 $3.97 $3.37
Since Oct 2017 Distributions per Common Share $3.78 $3.60 $3.09
Since Oct 2017 Basic NII Less Distributions per Common Share $0.42 $0.37 $0.28
Since Oct 2017 Basic NII Coverage of Distributions to Common Shareholders 111% 110% 109%
Net Asset Value (“NAV”) to Common Shareholders $3,966,391 $3,964,422 $4,140,128
NAV per Common Share $9.94 $10.01 $10.60
Net of Cash Debt to Equity Ratio(3) 49.4% 53.5% 51.3%
Net of Cash Asset Coverage of Debt Ratio(3) 301% 286% 293%
Unsecured Debt as % of Total Debt 71.3% 70.0% 80.3%
Unsecured or Non-Recourse Debt as % of Total Debt 100.0% 100.0% 100.0%
(1) Basic NII is calculated by dividing NII, less preferred dividends, by the weighted average number of common shares outstanding.
(2) Basic Net Income (Loss) is calculated by dividing Net Income (Loss) by the weighted average number of common shares outstanding.
(3) Including our preferred stock as equity.
CASH COMMON SHAREHOLDER DISTRIBUTION DECLARATION
Prospect is declaring distributions to common shareholders as follows:
Monthly Cash Common Shareholder Distribution Record Date Payment Date Amount (per share)
February 2023 2/24/2023 3/22/2023 $0.0600
March 2023 3/29/2023 4/19/2023 $0.0600
April 2023 4/26/2023 5/18/2023 $0.0600
These monthly cash distributions are the 66th, 67th, and 68th consecutive $0.06 per share distributions to common shareholders.
Prospect expects to declare May 2023, June 2023, July 2023, and August 2023 distributions to common shareholders in May 2023.
Based on the declarations above, Prospect’s closing stock price of $7.51 at February 7, 2023 delivers to our common shareholders an annualized distribution yield of 9.6% and an annualized basic NII yield of 12.3%, representing 128% basic NII coverage of common distributions.
Taking into account past distributions and our current share count for declared distributions, since inception through our April 2023 declared distribution, Prospect will have distributed $20.04 per share to original common shareholders, representing 2.0 times December 2022 common NAV, aggregating over $3.87 billion in cumulative distributions to all common shareholders.
Since inception in 2004, Prospect has invested $20 billion across 407 investments, exiting 275 of these investments.
Over the eleven quarters from the pre-pandemic December 2019 quarter to the September 2022 quarter, Prospect delivered the highest growth of net asset value per common share in the business development company industry, with NAV per common share increasing by 15.6% over that time period.
Since October 2017, our NII per common share has aggregated $4.20 while our common shareholder and preferred shareholder distributions per common share have aggregated $3.78, with our NII exceeding common and preferred distributions during this period by $0.42 per common share and representing 111% coverage.
Drivers focused on enhancing accretive NII per share growth include (1) our $1.75 billion targeted 6.50% perpetual preferred stock offerings (which could potentially be increased in capacity in an accretive fashion), (2) greater utilization of our cost efficient revolving credit facility (with an incremental cost of approximately 5.91% at today’s one month SOFR), (3) increase of short-term Libor and SOFR rates based on Fed tightening to boost asset yields, and (4) increased primary and secondary originations of senior secured debt and selected equity investments targeting attractive risk-adjusted yields and total returns as we deploy dry powder from our underleveraged balance sheet.
Our senior management team and employees own approximately 28% of all common shares outstanding, approximately $1.1 billion of our common equity as measured at NAV.
All amounts in $000’s except
per share amounts Six Months Ended
December 31, 2022 Six Months Ended
December 31, 2021
Net Investment Income (“NII”) $205,970 $166,926
Basic NII per Common Share $0.45 $0.40
Net Income Applicable to Common Stockholders $(49,576) $456,135
Basic Net Income per Common Share $(0.13) $1.17
Distributions to Common Shareholders $142,742 $140,283
Distributions per Common Share $0.36 $0.36
CASH PREFERRED SHAREHOLDER DISTRIBUTION DECLARATION
Prospect is declaring monthly distributions to 5.50% preferred shareholders at an annual rate of 5.50% of the stated value of $25.00 per share, from the date of issuance or, if later, from the most recent dividend payment date (the first business day of the month, with no additional dividend accruing in April as a result), as follows:
Monthly Cash 5.50% Preferred Shareholder Distribution Record Date Payment Date Monthly Amount (per share), before pro ration for partial periods
March 2023 3/22/2023 4/3/2023 $0.114583
April 2023 4/19/2023 5/1/2023 $0.114583
May 2023 5/17/2023 6/1/2023 $0.114583
Prospect is declaring monthly distributions to 6.50% preferred shareholders at an annual rate of 6.50% of the stated value of $25.00 per share, from the date of issuance or, if later, from the most recent dividend payment date (the first business day of the month, with no additional dividend accruing in April as a result), as follows:
Monthly Cash 6.50% Preferred Shareholder Distribution Record Date Payment Date Monthly Amount (per share), before pro ration for partial periods
March 2023 3/22/2023 4/3/2023 $0.135417
April 2023 4/19/2023 5/1/2023 $0.135417
May 2023 5/17/2023 6/1/2023 $0.135417
Prospect is declaring our second quarterly distribution to Series A preferred shareholders at an annual rate of 5.35% of the stated value of $25.00 per share, from the date of issuance or, if later, from the most recent dividend payment date, as follows:
Quarterly Cash 5.35% Preferred Shareholder Distribution Record Date Payment Date Amount (per share)
February 2023 - April 2023 4/19/2023 5/1/2023 $0.334375
PORTFOLIO UPDATE AND INVESTMENT ACTIVITY
All amounts in $000’s except
per unit amounts As of
December 31, 2022 As of
September 30, 2022
Total Investments (at fair value) $7,770,336 $7,582,665
Number of Portfolio Companies 130 128
First Lien Debt 53.0% 51.8%
Second Lien Debt 18.5% 19.0%
Subordinated Structured Notes 9.0% 9.2%
Unsecured Debt 0.2% 0.1%
Equity Investments 19.3% 19.9%
Mix of Investments with Underlying Collateral Security 80.5% 80.0%
Annualized Current Yield – All Investments 10.3% 9.9%
Annualized Current Yield – Performing Interest Bearing Investments 12.9% 12.4%
Top Industry Concentration(1) 17.7% 18.6%
Retail Industry Concentration(1) 0.4% 0.4%
Energy Industry Concentration(1) 1.6% 1.6%
Hotels, Restaurants & Leisure Concentration(1) 0.3% 0.3%
Non-Accrual Loans as % of Total Assets (2) 0.5% 0.3%
Middle-Market Loan Portfolio Company Weighted Average EBITDA(3) $111,925 $114,238
As of the quarter ended December 31, 2022, our middle-market loan portfolio company weighted average net debt leverage ratio was 5.41x.(3)
(1) Excluding our underlying industry-diversified structured credit portfolio.
(2) Calculated at fair value.
(3) For additional disclosure see “Middle-Market Loan Portfolio Company Weighted Average EBITDA and Net Leverage” at the end of this release.
During the March 2023 (to date), December 2022, and September 2022 quarters, investment originations and repayments were as follows:
All amounts in $000’s
Quarter Ended Quarter Ended Quarter Ended
March 31, 2023 (to date) December 31, 2022 September 30, 2022
Total Originations $25,580 $307,981 $304,530
Middle-Market Lending 51.1% 86.6% 69.6%
Real Estate 48.9% 8.5% 11.9%
Middle-Market Lending / Buyout —% 3.5% 4.9%
Structured Notes —% 1.4% 13.6%
Other —% —% —%
Total Repayments $40,117 $76,732 $150,463
Originations, Net of Repayments $(14,537) $231,249 $154,067
For additional disclosure see “Primary Origination Strategies” at the end of this release.
We have invested in subordinated structured notes benefiting from individual standalone financings non-recourse to Prospect, with our risk limited in each case to our net investment. At December 31, 2022 and September 30, 2022, our subordinated structured note portfolio at fair value consisted of the following:
All amounts in $000’s except
per unit amounts As of
December 31, 2022 As of
September 30, 2022
Total Subordinated Structured Notes $698,957 $695,292
Subordinated Structured Notes as % of Portfolio 9.0% 9.2%
# of Investments(2) 37 37
TTM Average Cash Yield(1)(2) 17.9% 20.6%
Annualized Cash Yield(1)(2) 11.6% 17.2%
Annualized GAAP Yield on Fair Value(1)(2) 14.9% 13.2%
Annualized GAAP Yield on Amortized Cost(2) 10.6% 9.3%
Cumulative Cash Distributions on Current Portfolio $1,473,278 $1,452,967
% of Original Investment 108.4% 106.9%
# of Underlying Collateral Loans 1,657 1,670
Total Asset Base of Underlying Portfolio $15,358,286 $15,440,229
(1) Calculation based on fair value.
(2) Excludes investments being redeemed.
To date we have exited 11 subordinated structured notes with an expected pooled average realized gross IRR of 15.2% and cash on cash multiple of 1.44 times.
Since December 31, 2017 through today, 32 of our subordinated structured note investments have completed multi-year extensions of their reinvestment periods (typically at reduced liability spreads and increased weighted average life asset benefits). We believe further long-term optionality upside exists in our structured credit portfolio through additional refinancings and reinvestment period extensions.
CAPITAL AND LIQUIDITY
Our multi-year, long-term laddered and diversified historical funding profile has included a $1.70 billion revolving credit facility (with 49 lenders, an increase of 7 lenders including our prior September 2022 extension and related upsizing), program notes, institutional bonds, convertible bonds, listed preferred stock, and program preferred stock. We have retired multiple upcoming maturities and as of today we have $282,115 of debt maturing in calendar year 2023. The combined amount of our balance sheet cash and undrawn revolving credit facility commitments is currently over $1 billion.
On September 15, 2022, we completed an amendment and upsizing of our existing revolving credit facility (the “Facility”) for Prospect Capital Funding, extending the term 1.5 years. The Facility includes a revolving period that extends through September 15, 2026, followed by an additional one-year amortization period. Pricing for amounts drawn under the Facility is one-month SOFR plus 2.05%.
Our total unfunded eligible commitments to non-control portfolio companies totals approximately $84 million, 1.1% of our total assets as of December 31, 2022.
As of As of
All amounts in $000’s December 31, 2022 September 30, 2022
Net of Cash Debt to Equity Ratio(1) 49.4% 53.5%
% of Interest-Bearing Assets at Floating Rates 82.6% 88.2%
% of Liabilities at Fixed Rates 71.3% 70.0%
% of Floating Loans with Libor or SOFR Floors 94.1% 94.3%
Weighted Average Libor/SOFR Floor 1.20% 1.26%
Unencumbered Assets $5,238,560 $4,965,086
% of Total Assets 66.4% 64.8%
(1) Including our preferred stock as equity.
The below table summarizes our December 2022 quarter term debt issuance and repurchase/repayment activity:
All amounts in $000’s Principal Coupon Maturity
Debt Issuances
Prospect Capital InterNotes® $2,852 5.00% - 5.95% October 2025 – December 2032
Total Debt Issuances $2,852
Debt Repurchases/Repayments
Prospect Capital InterNotes® $1,851 2.40% - 6.625% May 2026 – December 2051
2023 Notes $1,757 5.875% March 2023
Total Debt Repurchases/Repayments $3,608
Net Debt Repurchases/Repayments $(756)
We currently have six separate unsecured debt issuances aggregating over $1.5 billion outstanding, not including our program notes, with laddered maturities extending through October 2028. At December 31, 2022, $350.0 million of program notes were outstanding with laddered maturities through March 2052.
At December 31, 2022, our weighted average cost of unsecured debt financing was 4.33%, remaining constant from September 30, 2022, and a decrease of 0.06% from December 31, 2021.
On August 3, 2020 and October 3, 2020, we launched our $1.75 billion 5.50% perpetual preferred stock offering programs. On October 7, 2022, we amended our existing $1.75 billion in perpetual preferred stock offering programs to offer new 6.50% series of shares. Prospect expects to use the net proceeds from the offering programs to maintain and enhance balance sheet liquidity, including repaying our credit facility and purchasing high quality short-term debt instruments, and to make long-term investments in accordance with our investment objective. The preferred stock provides Prospect with a diversified source of accretive fixed-rate capital without creating maturity risk due to the perpetual term. To date we have issued over $1.2 billion of our 6.50% and 5.50% perpetual preferred stock programs (including $298 million in the December 2022 quarter and, to date, $70 million in the current March 2023 quarter), with the ability potentially to upsize such programs based on significant balance sheet capacity.
On July 19, 2021, we closed a $150 million listed 5.35% perpetual preferred stock offering. Prospect used the net proceeds from the offering to maintain and enhance balance sheet liquidity, including repaying our credit facility and redeeming higher cost program notes.
In connection with the 5.50% perpetual preferred stock offering program, effective August 3, 2020 and as amended on June 9, 2022, we adopted and amended, respectively, a Preferred Stock Dividend Reinvestment Plan, pursuant to which holders of the preferred stock will have dividends on their preferred stock automatically reinvested in additional shares of such preferred stock at a price per share of $25.00, if they elect.
In connection with the 6.50% perpetual preferred stock offering program, effective October 7, 2022 we adopted a Preferred Stock Dividend Reinvestment Plan, pursuant to which holders of the preferred stock will have dividends on their preferred stock automatically reinvested in additional shares of such preferred stock at a price per share of $25.00, if they elect.
We currently have approximately $1.4 billion in preferred stock outstanding.
Prospect holds recently reaffirmed investment grade company ratings, all with a stable outlook, from Standard & Poor’s (BBB-), Moody’s (Baa3), Kroll (BBB-), Egan-Jones (BBB), and DBRS (BBB (low)). Maintaining our investment grade ratings with prudent asset, liability, and risk management is an important objective for Prospect.
DIVIDEND REINVESTMENT PLAN
We have adopted a dividend reinvestment plan (also known as our “DRIP”) that provides for reinvestment of our distributions on behalf of our shareholders, unless a shareholder elects to receive cash. On April 17, 2020, our board of directors approved amendments to the Company’s DRIP, effective May 21, 2020. These amendments principally provide for the number of newly-issued shares pursuant to the DRIP to be determined by dividing (i) the total dollar amount of the distribution payable by (ii) 95% of the closing market price per share of our stock on the valuation date of the distribution (providing a 5% discount to the market price of our common stock), a benefit to shareholders who participate.
HOW TO PARTICIPATE IN OUR DIVIDEND REINVESTMENT PLAN
Shares held with a broker or financial institution
Many shareholders have been automatically “opted out” of our DRIP by their brokers. Even if you have elected to automatically reinvest your PSEC stock with your broker, your broker may have “opted out” of our DRIP (which utilizes DTC’s dividend reinvestment service), and you may therefore not be receiving the 5% pricing discount. Shareholders interested in participating in our DRIP to receive the 5% discount should contact their brokers to make sure each such DRIP participation election has been made through DTC. In making such DRIP election, each shareholder should specify to one’s broker the desire to participate in the "Prospect Capital Corporation DRIP through DTC" that issues shares based on 95% of the market price (a 5% discount to the market price) and not the broker's own "synthetic DRIP” plan (if any) that offers no such discount. Each shareholder should not assume one’s broker will automatically place such shareholder in our DRIP through DTC. Each shareholder will need to make this election proactively with one’s broker or risk not receiving the 5% discount. Each shareholder may also consult with a representative of such shareholder’s broker to request that the number of shares the shareholder wishes to enroll in our DRIP be re-registered by the broker in the shareholder’s own name as record owner in order to participate directly in our DRIP.
Shares registered directly with our transfer agent
If a shareholder holds shares registered in the shareholder’s own name with our transfer agent (less than 0.1% of our shareholders hold shares this way) and wants to make a change to how the shareholder receives dividends, please contact our plan administrator, American Stock Transfer and Trust Company LLC by calling (888) 888-0313 or by mailing American Stock Transfer and Trust Company LLC, 6201 15th Avenue, Brooklyn, New York 11219.
EARNINGS CONFERENCE CALL
Prospect will host an earnings call on Thursday February 9, 2023 at 9:30 a.m. Eastern Time. Dial 888-338-7333. For a replay prior to March 9, 2023 visit www.prospectstreet.com or call 877-344-7529 with passcode 3454656.
PROSPECT CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES
(in thousands, except share and per share data)
December 31, 2022 June 30, 2022
(Unaudited)
Assets
Investments at fair value:
Control investments (amortized cost of $2,821,034 and $2,732,906, respectively) $ 3,457,698 $ 3,438,317
Affiliate investments (amortized cost of $8,996 and $242,101, respectively) 7,944 393,264
Non-control/non-affiliate investments (amortized cost of $4,753,800 and $4,221,824, respectively) 4,304,694 3,770,929
Total investments at fair value (amortized cost of $7,583,830 and $7,196,831, respectively) 7,770,336 7,602,510
Cash and Cash Equivalents 70,086 35,364
Receivables for:
Interest, net 33,709 12,925
Other 974 745
Deferred financing costs on Revolving Credit Facility 14,895 10,801
Prepaid expenses 413 1,078
Total Assets 7,890,413 7,663,423
Liabilities
Revolving Credit Facility 754,305 839,464
Public Notes (less unamortized discount and debt issuance costs of $19,589 and $22,281, respectively) 1,343,766 1,343,178
Prospect Capital InterNotes® (less unamortized debt issuance costs of $6,931 and $7,122, respectively) 343,114 340,442
Convertible Notes (less unamortized discount and debt issuance costs of $2,024 and $2,477, respectively) 154,144 214,192
Due to Prospect Capital Management 61,393 58,100
Dividends payable 24,036 23,657
Interest payable 26,386 26,669
Accrued expenses 5,410 3,309
Due to Prospect Administration 3,765 2,281
Other liabilities 150 932
Total Liabilities 2,716,469 2,852,224
Commitments and Contingencies
Preferred Stock, par value $0.001 per share (387,900,000 and 227,900,000 shares of preferred stock authorized, with 60,000,000 as Series A1, 60,000,000 as Series M1, 60,000,000 as Series M2, 20,000,000 as Series AA1, 20,000,000 as Series MM1, 1,000,000 as Series A2, 6,900,000 as Series A, 60,000,000 and 0 as Series A3, 60,000,000 and 0 as Series M3, 20,000,000 and 0 as Series AA2, and 20,000,000 and 0 as Series MM2, each as of December 31, 2022 and June 30, 2022; 31,143,878 and 20,794,645 Series A1 shares issued and outstanding; 3,996,761 and 2,626,238 Series M1 shares issued and outstanding; 0 and 0 Series M2 shares issued and outstanding; 0 and 0 Series AA1 shares issued and outstanding; 0 and 0 Series MM1 shares issued and outstanding; 187,000 and 187,000 Series A2 shares issued and outstanding; 6,000,000 and 6,000,000 Series A shares issued and outstanding; 10,184,347 and 0 Series A3 shares issued and outstanding; 1,157,019 and 0 Series M3 shares issued and outstanding; 0 and 0 Series AA2 shares issued and outstanding; and 0 and 0 Series MM2 shares issued and outstanding as of December 31, 2022 and June 30, 2022) at carrying value plus cumulative accrued and unpaid dividends 1,207,553 692,076
Net Assets Applicable to Common Shares $ 3,966,391 $ 4,119,123
Components of Net Assets Applicable to Common Shares and Net Assets, respectively
Common stock, par value $0.001 per share (1,612,100,000 and 1,772,100,000 common shares authorized; 398,852,478 and 393,164,437 issued and outstanding, respectively) 399 393
Paid-in capital in excess of par 4,089,950 4,050,370
Total distributable (loss) earnings (123,958 ) 68,360
Net Assets Applicable to Common Shares $ 3,966,391 $ 4,119,123
Net Asset Value Per Common Share $ 9.94 $ 10.48
PROSPECT CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share data)
Three Months Ended December 31, Six Months Ended December 31,
2022 2021 2022 2021
Investment Income
Interest income:
Control investments $ 60,820 $ 57,110 $ 123,083 $ 112,941
Affiliate investments 7,573 6,675 15,034 16,752
Non-control/non-affiliate investments 96,436 60,132 178,134 117,661
Structured credit securities 26,047 18,256 48,943 41,090
Total interest income 190,876 142,173 365,194 288,444
Dividend income:
Control investments 1,170 5,687 2,357 6,937
Affiliate investments — — 1,374 —
Non-control/non-affiliate investments 1,047 17 1,387 34
Total dividend income 2,217 5,704 5,118 6,971
Other income:
Control investments 15,030 11,703 35,695 28,735
Affiliate investments — 126 133 3,942
Non-control/non-affiliate investments 4,793 15,670 9,450 16,758
Total other income 19,823 27,499 45,278 49,435
Total Investment Income 212,916 175,376 415,590 344,850
Operating Expenses
Base management fee 38,882 33,843 77,196 66,046
Income incentive fee 22,505 19,589 44,131 39,329
Interest and credit facility expenses 37,783 29,679 71,653 57,717
Allocation of overhead from Prospect Administration 3,618 2,239 6,717 6,765
Audit, compliance and tax related fees 236 329 2,537 946
Directors’ fees 131 113 262 229
Other general and administrative expenses 3,057 4,027 7,124 6,892
Total Operating Expenses 106,212 89,819 209,620 177,924
Net Investment Income 106,704 85,557 205,970 166,926
Net Realized and Net Change in Unrealized Gains (Losses) from Investments
Net realized gains (losses)
Control investments (619 ) 3 (1,712 ) 6
Affiliate investments 16,143 — 16,143 —
Non-control/non-affiliate investments 774 (9,230 ) (21,310 ) (9,834 )
Net realized gains (losses) 16,298 (9,227 ) (6,879 ) (9,828 )
Net change in unrealized (losses) gains
Control investments (21,458 ) 134,066 (68,747 ) 256,396
Affiliate investments (18,248 ) 31,589 (89,034 ) 37,626
Non-control/non-affiliate investments (10,967 ) 15,479 (61,392 ) 23,832
Net change in unrealized (losses) gains (50,673 ) 181,134 (219,173 ) 317,854
Net Realized and Net Change in Unrealized (Losses) Gains from Investments (34,375 ) 171,907 (226,052 ) 308,026
Net realized losses on extinguishment of debt (52 ) (3,851 ) (80 ) (9,208 )
Net Increase (Decrease) in Net Assets Resulting from Operations 72,277 253,613 (20,162 ) 465,744
Preferred stock dividend 16,654 7,202 29,414 9,609
Net Increase (Decrease) in Net Assets Resulting from Operations applicable to Common Stockholders $ 55,623 $ 246,411 $ (49,576 ) $ 456,135
PROSPECT CAPITAL CORPORATION AND SUBSIDIARIES
ROLLFORWARD OF NET ASSET VALUE PER COMMON SHARE
(in actual dollars)
Three Months Ended December 31, Six Months Ended December 31,
2022 2021 2022 2021
Per Share Data
Net asset value per common share at beginning of period $ 10.01 $ 10.12 $ 10.48 $ 9.81
Net investment income(1) 0.27 0.22 0.52 0.43
Net realized and change in unrealized (losses) gains(1) (0.09 ) 0.43 (0.57 ) 0.77
Net increase (decrease) from operations 0.18 0.65 (0.05 ) 1.20
Distributions of net investment income to preferred stockholders (0.04 ) (0.02 ) (0.07 ) (0.03 )
Net increase (decrease) from operations applicable to common stockholders(4) 0.14 0.63 (0.12 ) 1.17
Distributions of net investment income to common stockholders (0.18 ) (3) (0.18 ) (0.36 ) (3) (0.35 )
Return of Capital to common stockholders — (3) — — (3) (0.01 )
Common stock transactions(2) (0.03 ) (0.01 ) (0.06 ) (0.02 )
Offering costs from issuance of preferred stock — — — (0.03 )
Reclassification of preferred stock issuance costs — 0.03 — 0.03
Net asset value per common share at end of period $ 9.94 $ 10.60 (5 ) $ 9.94 $ 10.60
(1) Per share data amount is based on the weighted average number of common shares outstanding for the period presented (except for dividends to stockholders which is based on actual rate per share).
(2) Common stock transactions include the effect of our issuance of common stock in public offerings (net of underwriting and offering costs), shares issued in connection with our common stock dividend reinvestment plan, common shares issued to acquire investments and common shares repurchased below net asset value pursuant to our Repurchase Program, and common shares issued pursuant to the Holder Optional Conversion of our 5.50% and 6.50% Preferred Stock.
(3) Not finalized for the respective fiscal period.
(4) Diluted net increase from operations applicable to common stockholders was $0.13 for the three months ended December 31, 2022. Diluted net increase from operations applicable to common stockholders was $0.61 for the three months ended December 31, 2021. Diluted net decrease from operations applicable to common stockholders was $0.13 for the six months ended December 31, 2022. Diluted net increase from operations applicable to common stockholders was $1.13 for the six months ended December 31, 2021.
(5) Does not foot due to rounding.
MIDDLE-MARKET LOAN PORTFOLIO COMPANY WEIGHTED AVERAGE EBITDA AND NET LEVERAGE
Middle-Market Loan Portfolio Company Weighted Average Net Leverage (“Middle-Market Portfolio Net Leverage”) and Middle-Market Loan Portfolio Company Weighted Average EBITDA (“Middle-Market Portfolio EBITDA”) provide clarity into the underlying capital structure of PSEC’s middle-market loan portfolio investments and the likelihood that PSEC’s overall portfolio will make interest payments and repay principal.
Middle-Market Portfolio Net Leverage reflects the net leverage of each of PSEC’s middle-market loan portfolio company debt investments, weighted based on the current fair market value of such debt investments. The net leverage for each middle-market loan portfolio company is calculated based on PSEC’s investment in the capital structure of such portfolio company, with a maximum limit of 10.0x adjusted EBITDA. This calculation excludes debt subordinate to PSEC’s position within the capital structure because PSEC’s exposure to interest payment and principal repayment risk is limited beyond that point. Additionally, subordinated structured notes, other structured credit, real estate investments, investments for which EBITDA is not available, and equity investments, for which principal repayment is not fixed, are also not included in the calculation. The calculation does not exceed 10.0x adjusted EBITDA for any individual investment because 10.0x captures the highest level of risk to PSEC. Middle-Market Portfolio Net Leverage provides PSEC with some guidance as to PSEC’s exposure to the interest payment and principal repayment risk of PSEC’s overall debt portfolio. PSEC monitors its Middle-Market Portfolio Net Leverage on a quarterly basis.
Middle-Market Portfolio EBITDA is used by PSEC to supplement Middle-Market Portfolio Net Leverage and generally indicates a portfolio company’s ability to make interest payments and repay principal. Middle-Market Portfolio EBITDA is calculated using the EBITDA of each of PSEC’s middle-market loan portfolio companies, weighted based on the current fair market value of the related investments. The calculation provides PSEC with insight into profitability and scale of the portfolio companies within our overall debt investments.
These calculations include addbacks that are typically negotiated and documented in the applicable investment documents, including but not limited to transaction costs, share-based compensation, management fees, foreign currency translation adjustments and other nonrecurring transaction expenses.
Together, Middle-Market Portfolio Net Leverage and Middle-Market Portfolio EBITDA assist PSEC in assessing the likelihood that PSEC will timely receive interest and principal payments. However, these calculations are not meant to substitute for an analysis of PSEC’s our underlying portfolio company debt investments, but to supplement such analysis.
PRIMARY ORIGINATION STRATEGIES
Middle-Market Lending - We make directly-originated, agented loans to companies, including companies which are controlled by private equity sponsors and companies that are not controlled by private equity sponsors (such as companies that are controlled by the management team, the founder, a family or public shareholders). This debt can take the form of first lien, second lien, unitranche or unsecured loans. These loans typically have equity subordinate to our loan position. We may also purchase selected equity co-investments in such companies. In addition to directly-originated, agented loans, we also invest in senior and secured loans, syndicated loans and high yield bonds that have been sold to a club or syndicate of buyers, both in the primary and secondary markets. These investments are often purchased with a long term, buy-and-hold outlook, and we often look to provide significant input to the transaction by providing anchoring orders.
Middle-Market Lending / Buyout - This strategy involves purchasing senior and secured yield-producing debt and controlling equity positions in operating companies across various industries. We believe this strategy provides enhanced certainty of closing to sellers, and the opportunity for management to continue in their current roles. These investments are often structured in tax-efficient partnerships, enhancing returns.
Real Estate - We purchase debt and controlling equity positions in tax-efficient real estate investment trusts (“REIT” or “REITs”). The real estate investments of National Property REIT Corp. (“NPRC”) are in various classes of developed and occupied real estate properties that generate current yields, including multi-family properties, student housing, and self-storage. NPRC seeks to identify properties that have historically attractive occupancy rates and recurring cash flow generation. NPRC generally co-invests with established and experienced property management teams that manage such properties after acquisition.
Subordinated Structured Notes - We make investments in structured credit, often taking a significant position in subordinated structured notes (equity) and rated secured structured notes (debt). The underlying portfolio of each structured credit investment is diversified across approximately 100 to 200 broadly syndicated loans and does not have direct exposure to real estate, mortgages, or consumer-based credit assets. The structured credit portfolios in which we invest are managed by established collateral management teams with many years of experience in the industry.
ABOUT PROSPECT CAPITAL CORPORATION
Prospect Capital Corporation (www.prospectstreet.com) is a business development company that focuses on lending to and investing in private businesses. Our investment objective is to generate both current income and long-term capital appreciation through debt and equity investments.
We have elected to be treated as a business development company under the Investment Company Act of 1940 (“1940 Act”). We are required to comply with regulatory requirements under the 1940 Act as well as applicable NASDAQ, federal and state rules and regulations. We have elected to be treated as a regulated investment company under the Internal Revenue Code of 1986.
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, whose safe harbor for forward-looking statements does not apply to business development companies. Any such statements, other than statements of historical fact, are highly likely to be affected by other unknowable future events and conditions, including elements of the future that are or are not under our control, and that we may or may not have considered; accordingly, such statements cannot be guarantees or assurances of any aspect of future performance. Actual developments and results are highly likely to vary materially from any forward-looking statements. Such statements speak only as of the time when made. We undertake no obligation to update any such statement now or in the future.
For additional information, contact:
Grier Eliasek, President and Chief Operating Officer
grier@prospectcap.com
Telephone (212) 448-0702
Primary Logo
Nordson Corporation Reports First Quarter Fiscal 2023 Results and Updates Annual Guidance
Source: Business Wire
First Quarter:
Sales were $610 million, a 1% organic increase over the prior year
Operating profit was $144 million
Adjusted operating profit was $155 million, 25% of sales
Earnings per share were $1.81
Adjusted earnings per share were $1.95 compared to $2.07 in the prior year
Guidance:
Updating previously issued full-year fiscal 2023 guidance: revenue growth of 0% to 3% over record fiscal 2022 and adjusted earnings per diluted share in the range of $8.75 to $9.50 per share
Nordson Corporation (Nasdaq: NDSN) today reported results for the fiscal first quarter ended January 31, 2023. Sales were $610 million, comparable to the prior year’s first quarter sales of $609 million. The increase in first quarter 2023 sales includes an organic increase of 1% and a favorable acquisition impact of 3%, offset by unfavorable currency translation of 4%. The organic sales increase was driven by strong 9% combined growth in Europe and the Americas, partially offset by weakness in Asia Pacific, predominantly China.
Operating profit in the first quarter was $144 million. Adjusted operating profit, excluding transaction fees, severance and non-cash inventory charges associated with the CyberOptics acquisition, totaled $155 million, or 25% of sales, compared to prior year adjusted operating profit of $157 million. The operating profit, similar to sales, was comparable to the prior year as favorable organic and acquisitive growth was offset by an unfavorable 6% headwind from currency translation. EBITDA for the first quarter of 2023 totaled $181 million, or 30% of sales.
Net income was $104 million, or $1.81 earnings per diluted share. Adjusted net income was $112 million, a $9 million decrease from the prior year earnings of $122 million. The decrease was driven by increased interest expense and foreign currency losses. First quarter 2023 adjusted earnings per diluted share were $1.95, a 6% decrease over the prior year adjusted earnings per diluted share of $2.07.
“First quarter results were in line with our expectations. Our team delivered sales growth comparable to a record fiscal first quarter 2022 despite unfavorable currency headwinds, the timing of the Chinese New Year, and the unexpected negative impact from the spread of COVID-19 in China. Growth was driven by the benefits of our CyberOptics acquisition, as well as solid demand in industrial and medical interventional solutions product lines. The diversity of our geographies and product lines in Europe and Americas, as well as our steadfast dedication to advancing the NBS Next growth framework and responding to the needs of our customers, continues to deliver high quality business performance in dynamic market conditions,” said Sundaram Nagarajan, president and chief executive officer.
First Quarter Segment Results
Industrial Precision Solutions sales of $312 million represents a constant currency growth of 1% over the prior year, offset by unfavorable currency translation impacts. The organic growth of 1% was driven primarily by steady demand across most product lines and regions, offset by softness in the Asia Pacific region due to labor shortages from the spread of COVID-19, as well as the timing of Chinese New Year. Operating profit in the quarter was $102 million, or 33% of sales, comparable to the prior year first quarter.
Medical and Fluid Solutions sales of $154 million decreased 3% compared to the prior year first quarter. Organic sales decreased 1% and currency had an unfavorable impact of 2%. The organic sales decrease was driven by significant softness in the medical fluid components product lines and fluid solutions product lines in China, offset by strong demand for medical interventional solutions product lines. Operating profit totaled $39 million, or 26% of sales, a decrease of 20% compared to the prior year first quarter operating profit. The decreased segment profitability resulted from meaningful sales mix changes within medical product lines and related individual factory inefficiencies due to reduced volumes.
Advanced Technology Solutions sales of $145 million increased 14% compared to the prior year first quarter. Sales benefited from the acquisition impact of 14% and an increase in organic sales of 5%, partially offset by an unfavorable currency impact of 4%. The organic sales increase was driven by test and inspection product lines. Operating profit totaled $17 million. Adjusted operating profit, excluding non-cash inventory and other acquisition-related charges, totaled $27 million, or 19% of sales, which was comparable to the prior year first quarter operating profit. Improvements in profit from the acquisition were offset by unfavorable changes in sales mix and a 5% currency translation headwind.
Outlook
While the backlog remains robust at approximately $1 billion, the backlog is not consistent across the different businesses and is heavily weighted toward systems and medical interventional solutions. Order entry in recent weeks has decreased from the previous run rate and several customers have been pushing delivery dates out into the second half of fiscal 2023. Based on our current visibility, the Company is updating its previously issued full-year revenue growth guidance to 0% to 3% over record fiscal 2022 and narrowing its adjusted earnings guidance to the range of $8.75 to $9.50.
Nordson management will provide additional commentary on these results and outlook during its previously announced webcast on Tuesday, February 21, 2023, at 8:30 a.m. eastern time, which can be accessed at https://investors.nordson.com. For persons unable to listen to the live broadcast, a replay will be available for 14 days after the event. Information about Nordson’s investor relations and shareholder services is available from Lara Mahoney, vice president, investor relations and corporate communications at (440) 204-9985 or lara.mahoney@nordson.com.
Certain statements contained in this release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by terminology such as “may,” “will,” “should,” “could,” “expects,” “anticipates,” “believes,” “projects,” “forecasts,” “outlook,” “guidance,” “continue,” “target,” or the negative of these terms or comparable terminology. These statements reflect management’s current expectations and involve a number of risks and uncertainties. These risks and uncertainties include, but are not limited to, U.S. and international economic conditions; financial and market conditions; currency exchange rates and devaluations; possible acquisitions, including the Company’s ability to successfully integrate acquisitions; the Company’s ability to successfully divest or dispose of businesses that are deemed not to fit with its strategic plan; the effects of changes in U.S. trade policy and trade agreements; the effects of changes in tax law; and the possible effects of events beyond our control, such as political unrest, including the conflict between Russia and Ukraine, acts of terror, natural disasters and pandemics, including the coronavirus (COVID-19) pandemic and the other factors discussed in Item 1A (Risk Factors) in the Company’s most recently filed Annual Report on Form 10-K and in its Forms 10-Q filed with the Securities and Exchange Commission, which should be reviewed carefully. The Company undertakes no obligation to update or revise any forward-looking statement in this press release.
Nordson Corporation is an innovative precision technology company that leverages a scalable growth framework through an entrepreneurial, division-led organization to deliver top tier growth with leading margins and returns. The Company’s direct sales model and applications expertise serves global customers through a wide variety of critical applications. Its diverse end market exposure includes consumer non-durable, medical, electronics and industrial end markets. Founded in 1954 and headquartered in Westlake, Ohio, the Company has operations and support offices in over 35 countries. Visit Nordson on the web at www.nordson.com, www.twitter.com/Nordson_Corp or www.facebook.com/nordson.
NORDSON CORPORATION
CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
(Dollars in thousands except for per-share amounts)
Three Months Ended
January 31,
2023
January 31,
2022
Sales
$
610,477
$
609,166
Cost of sales
281,610
269,032
Gross profit
328,867
340,134
Gross margin %
53.9
%
55.8
%
Selling & administrative expenses
184,648
184,274
Operating profit
144,219
155,860
Interest expense - net
(9,943
)
(5,185
)
Other income (expense) - net
(3,196
)
1,292
Income before income taxes
131,080
151,967
Income taxes
26,819
31,558
Net income
$
104,261
$
120,409
Weighted-average common shares outstanding:
Basic
57,170
58,152
Diluted
57,762
58,819
Earnings per share:
Basic earnings
$
1.82
$
2.07
Diluted earnings
$
1.81
$
2.05
NORDSON CORPORATION
CONSOLIDATED BALANCE SHEETS (Unaudited)
(Dollars in thousands)
January 31, 2023
October 31, 2022
Cash and cash equivalents
$
121,994
$
163,457
Receivables - net
546,649
537,313
Inventories - net
447,727
383,398
Other current assets
62,046
48,803
Total current assets
1,178,416
1,132,971
Property, plant & equipment - net
361,447
353,442
Goodwill
2,107,113
1,804,693
Other assets
590,447
529,269
$
4,237,423
$
3,820,375
Current maturities of long-term debt and notes payable
$
420,947
$
392,537
Accounts payable and accrued liabilities
404,514
441,666
Total current liabilities
825,461
834,203
Long-term debt
595,166
345,320
Other liabilities
370,111
346,477
Total shareholders' equity
2,446,685
2,294,375
$
4,237,423
$
3,820,375
NORDSON CORPORATION
CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited)
(Dollars in thousands)
Three Months Ended
January 31,
2023
January 31,
2022
Cash flows from operating activities:
Net income
$
104,261
$
120,409
Depreciation and amortization
26,434
25,390
Other non-cash items
6,224
11,023
Changes in working capital
(58,371
)
(29,217
)
Other
44,789
(9,518
)
Net cash provided by operating activities
123,337
118,087
Cash flows from investing activities:
Additions to property, plant and equipment
(9,302
)
(12,491
)
Acquisition of businesses, net of cash acquired
(377,843
)
(171,613
)
Other - net
9
7
Net cash used in investing activities
(387,136
)
(184,097
)
Cash flows from financing activities:
Issuance (repayment) of long-term debt
252,278
(1,257
)
Repayment of finance lease obligations
(1,318
)
(1,640
)
Dividends paid
(37,199
)
(29,724
)
Issuance of common shares
8,807
5,721
Purchase of treasury shares
(6,875
)
(35,002
)
Net cash provided (used) in financing activities
215,693
(61,902
)
Effect of exchange rate change on cash:
6,643
(1,521
)
Net change in cash and cash equivalents
(41,463
)
(129,433
)
Cash and cash equivalents:
Beginning of period
163,457
299,972
End of period
$
121,994
$
170,539
NORDSON CORPORATION
SALES BY GEOGRAPHIC SEGMENT (Unaudited)
(Dollars in thousands)
Three Months Ended
Sales Variance
January 31,
2023
January 31,
2022
Organic
Acquisitions
Currency
Total
SALES BY SEGMENT
Industrial precision solutions
$
311,546
$
323,933
1.2
%
—
%
(5.0
) %
(3.8
) %
Medical and fluid solutions
154,287
158,784
(0.8
) %
—
%
(2.0
) %
(2.8
) %
Advanced technology solutions
144,644
126,449
4.6
%
13.5
%
(3.7
) %
14.4
%
Total sales
$
610,477
$
609,166
1.4
%
2.8
%
(4.0
) %
0.2
%
SALES BY GEOGRAPHIC REGION
Americas
$
264,878
$
239,901
8.6
%
2.1
%
(0.3
) %
10.4
%
Europe
162,939
155,985
10.7
%
1.3
%
(7.5
) %
4.5
%
Asia Pacific
182,660
213,280
(13.3
) %
4.7
%
(5.8
) %
(14.4
) %
Total sales
$
610,477
$
609,166
1.4
%
2.8
%
(4.0
) %
0.2
%
NORDSON CORPORATION
RECONCILIATION OF NON-GAAP MEASURES - ADJUSTED OPERATING PROFIT AND EBITDA (Unaudited)
(Dollars in thousands)
Three Months Ended
January 31, 2023
January 31, 2022
SALES BY SEGMENT
Industrial precision solutions
$
311,546
$
323,933
Medical and fluid solutions
154,287
158,784
Advanced technology solutions
144,644
126,449
Total sales
$
610,477
$
609,166
OPERATING PROFIT
Industrial precision solutions
$
102,319
$
102,187
Medical and fluid solutions
39,384
49,093
Advanced technology solutions
16,963
27,234
Corporate
(14,447
)
(22,654
)
Total operating profit
$
144,219
$
155,860
OPERATING PROFIT ADJUSTMENTS (1)
Industrial precision solutions
$
—
$
1,563
Advanced technology solutions
10,295
—
Total adjustments
$
10,295
$
1,563
ADJUSTED OPERATING PROFIT (NON-GAAP) (2)
% of Sales
% of Sales
Industrial precision solutions
$
102,319
33
%
$
103,750
32
%
Medical and fluid solutions
39,384
26
%
49,093
31
%
Advanced technology solutions
27,258
19
%
27,234
22
%
Corporate
(14,447
)
(22,654
)
Total operating profit - adjusted
$
154,514
25
%
$
157,423
26
%
DEPRECIATION & AMORTIZATION
Industrial precision solutions
$
6,845
$
7,442
Medical and fluid solutions
13,625
13,547
Advanced technology solutions
3,812
2,263
Corporate
2,152
2,138
Total depreciation & amortization
$
26,434
$
25,390
EBITDA (NON-GAAP) (2)
Industrial precision solutions
$
109,164
35
%
$
111,192
34
%
Medical and fluid solutions
53,009
34
%
62,640
39
%
Advanced technology solutions
31,070
21
%
29,497
23
%
Corporate
(12,295
)
(20,516
)
Total EBITDA
$
180,948
30
%
$
182,813
30
%
(1)
Represents fees, severance and non-cash inventory charges associated with acquisitions.
(2)
Adjusted operating profit and EBITDA are non-GAAP measures used by management to evaluate the Company's ongoing operations. Adjusted operating profit is defined as operating profit plus certain adjustments, such as fees, severance and non-cash inventory charges associated with acquisitions. EBITDA is defined as adjusted operating profit plus depreciation and amortization.
NORDSON CORPORATION
RECONCILIATION OF NON-GAAP MEASURES - PROFITABILITY (Unaudited)
(Dollars in thousands)
Three Months Ended
January 31, 2023
January 31, 2022
GAAP AS REPORTED
Operating profit
$
144,219
$
155,860
Other / interest expense - net
(13,139
)
(3,893
)
Net income
104,261
120,409
Diluted earnings per share
$
1.81
$
2.05
Shares outstanding - diluted
57,762
58,819
OPERATING PROFIT ADJUSTMENTS
Inventory step-up amortization
$
4,306
$
1,563
Severance and other
5,989
—
Total adjustments
$
10,295
$
1,563
Adjustments net of tax
$
8,189
$
1,238
EPS effect of adjustments and other discrete tax items
$
0.14
$
0.02
NON-GAAP MEASURES-ADJUSTED PROFITABILITY
Operating profit (1)
$
154,514
$
157,423
Operating profit % of sales
25.3
%
25.8
%
Net income (2)
$
112,450
$
121,647
Diluted earnings per share (3)
$
1.95
$
2.07
(1)
Adjusted operating profit is defined as operating profit plus certain adjustments, such as fees, severance, and non-cash inventory charges related to acquisitions. Adjusted operating profit as a percentage of sales is defined as adjusted operating profit divided by sales.
(2)
Adjusted net income is defined as net income plus tax effected adjustments and other discrete tax items.
(3)
Adjusted earnings per share is defined as GAAP EPS adjusted for tax effected adjustments and other discrete tax items.
The Company also uses the non-GAAP financial measure “constant currency” sales or sales “on a constant currency basis” to show changes in our revenue without giving effect to period-to-period currency fluctuations. Constant currency is defined as sales growth excluding the impacts of changes in foreign currencies. We express period over period revenue variances that are calculated in constant currency as a percentage. Because the reconciliation is inherent in the disclosure, we believe that a separate reconciliation would not provide any benefit.
Management uses these non-GAAP measures internally to make strategic decisions, forecast future results, and evaluate the Company's current performance. Given management's use of these non-GAAP measures, the Company believes these measures are important to investors in understanding the Company's current and future operating results as seen through the eyes of management. In addition, management believes these non-GAAP measures are useful to investors in enabling them to better assess changes in the Company's core business across different time periods. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures to other companies' non-GAAP financial measures, even if they have similar names. Amounts may not add due to rounding.
View source version on businesswire.com: https://www.businesswire.com/news/home/20230220005225/en/
Lara Mahoney
Vice President, Investor Relations & Corporate Communications
440.204.9985
Lara.Mahoney@nordson.com
FORM 8-K
(Current report filing)
Filed 12/15/22 for the Period Ending 12/15/22
https://www.otcmarkets.com/filing/conv_pdf?id=16261726&guid=Uh7-knSQbFKAdth
FORM 10-Q
(Quarterly Report)
Filed 12/06/22 for the Period Ending 10/31/22
https://www.otcmarkets.com/filing/conv_pdf?id=16246196&guid=Uh7-knSQbFKAdth
T2 Biosystems Announces Pricing of $12 Million Public Offering
Source: GlobeNewswire Inc.
T2 Biosystems, Inc. (NASDAQ: TTOO) today announced the pricing of its previously announced underwritten public offering of 11,111,111 shares of common stock (or common stock equivalents) and warrants to purchase up to 22,222,222 shares of common stock at a combined public offering price of $1.08 per share of common stock (or common stock equivalent) and accompanying warrants, for initial gross proceeds of approximately $12 million, before underwriting discounts and commissions and offering expenses. The warrants have an exercise price of $1.08 per share, are exercisable immediately and will expire five years following the date of issuance.
The offering is expected to close on or about February 17, 2023, subject to customary closing conditions.
Craig-Hallum Capital Group LLC is acting as the sole managing underwriter for the offering.
This offering is being made pursuant to a shelf registration statement filed with the Securities and Exchange Commission (SEC) on March 31, 2021 and was declared effective on April 9, 2021. A preliminary prospectus supplement and accompanying prospectus relating to the offering have been filed with the SEC and are available on the SEC's website at www.sec.gov. A final prospectus supplement will be filed with the SEC. Copies of the final prospectus supplement and accompanying prospectus relating to the offering, when available, may also be obtained by contacting Craig-Hallum Capital Group LLC, Attention: Equity Capital Markets, 222 South 9th Street, Suite 350, Minneapolis, Minnesota 55402, by telephone at (612) 334-6300, or by email at prospectus@chlm.com.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
About T2 Biosystems
T2 Biosystems, a leader in the rapid detection of sepsis-causing pathogens and antibiotic resistance genes, is dedicated to improving patient care and reducing the cost of care by helping clinicians effectively treat patients faster than ever before. T2 Biosystems’ products include the T2Dx® Instrument, the T2Bacteria® Panel, the T2Candida® Panel, the T2Resistance® Panel, and the T2SARS-CoV-2™ Panel and are powered by the proprietary T2 Magnetic Resonance (T2MR®) technology. T2 Biosystems has an active pipeline of future products, including the T2Biothreat™ Panel, the T2Cauris™ Panel, and T2Lyme™ Panel, as well as next-generation products for the detection of bacterial and fungal pathogens and associated antimicrobial resistance markers.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements, including, without limitation, statements regarding the public offering of T2 Biosystems’s common stock (or common stock equivalents) and warrants, and anticipated closing and proceeds of the offering. These and other important factors discussed under the caption “Risk Factors” in T2 Biosystems’s Annual Report on Form 10-K for the year ended December 31, 2021 filed with the U.S. Securities and Exchange Commission (SEC), T2 Biosystems’s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2022, and T2 Biosystems’s other filings with the SEC could cause actual results to differ materially from those indicated by the forward-looking statements made in this press release. Any forward-looking statements speak only as of the date of this press release and are based on information available to T2 Biosystems as of the date of this release, and T2 Biosystems assumes no obligation to, and does not intend to, update any forward-looking statements, whether as a result of new information, future events or otherwise.
Investor Contact
Philip Trip Taylor, Gilmartin Group
ir@T2Biosystems.com
415-937-5406
Primary Logo
Camtek Receives an $18 Million Order for Multiple Systems from a Leading Global Compound Semiconductors Manufacturer
Source: PR Newswire (US)
Demonstrates Camtek's leadership position in the compound semi market.
MIGDAL HAEMEK, Israel, Jan. 11, 2023 /PRNewswire/ -- Camtek Ltd. (NASDAQ: CAMT) (TASE: CAMT), today announced that it received a multiple systems' order from a leading global Compound Semiconductors manufacturer totaling $18 million.
Camtek logo
The order is for Camtek's latest Eagle model, equipped with cutting-edge inspection technologies and designed with advanced capabilities developed specifically for this market segment.
The Eagle systems are expected to be delivered starting from the second quarter of 2023 through early 2024.
Rafi Amit, Chief Executive Officer, commented, "This is an excellent start to 2023. The compound semiconductors market is expected to present strong growth in the coming years fueled by the automotive industry and other applications. This order demonstrates our competitive position and technology leadership in this segment."
ABOUT CAMTEK LTD.
Camtek is a developer and manufacturer of high-end inspection and metrology equipment for the semiconductor industry. Camtek's systems inspect IC and measure IC features on wafers throughout the production process of semiconductor devices, covering the front and mid-end and up to the beginning of assembly (Post Dicing). Camtek's systems inspect wafers for the most demanding semiconductor market segments, including Advanced Interconnect Packaging, Memory, CMOS Image Sensors, MEMS, and RF, serving numerous industry's leading global IDMs, OSATs, and foundries.
With eight offices around the world, Camtek has best-in-class sales and customer support organization, providing tailor-made solutions in line with customers' requirements.
This press release is available at www.camtek.com
This press release contains statements that may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on Camtek's current beliefs, expectations and assumptions about its business and industry, all of which may change. Forward-looking statements can be identified by the use of words including "believe," "anticipate," "should," "intend," "plan," "will," "may," "expect," "estimate," "project," "positioned," "strategy," and similar expressions that are intended to identify forward-looking statements, including statements relating to the compound semiconductors market and our position in this market and the anticipated timing of delivery of the systems. These forward-looking statements involve known and unknown risks and uncertainties that may cause the actual results, performance or achievements of Camtek to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Factors that may cause our actual results to differ materially from those contained in the forward-looking statements include, but are not limited to, the impact of any new or revised export and/or import and doing-business regulations or sanctions, such as changes in U.S. trade policies; the risks relating to the concentration of a significant portion of our business in certain countries in the Asia Pacific Region, particularly China (which is our largest territory), Taiwan and Korea; the impact of the war in Ukraine, rising inflation, rising interest rates, volatile exchange rates and commodities' prices, and continuing or new effects as a result of the COVID-19 pandemic; our dependency upon the semiconductor industry and the risk that unfavorable economic conditions or low capital expenditures may negatively impact our operating results; anticipated trends and impacts related to industry component and substrate shortages and other supply chain challenges; the future purchase, use, and availability of components supplied by third parties; impurities and other disruptions to our customers' operations, which could lower production yields or interrupt manufacturing, and could result in the cancellation or delay of purchases of our products; and those other factors discussed in our Annual Report on Form 20-F and other documents filed by the Company with the SEC as well as other documents that may be subsequently filed by Camtek from time to time with the SEC. We caution you not to place undue reliance on forward-looking statements, which speak only as of the date hereof. Camtek does not assume any obligation to update any forward-looking statements in order to reflect events or circumstances that may arise after the date of this release unless required by law.
CAMTEK LTD.
Moshe Eisenberg, CFO
Tel: +972 4 604 8308
Mobile: +972 54 900 7100
moshee@camtek.com
CLS HOLDINGS USA, INC.
FORM 10-Q
(Quarterly Report)
Filed 01/12/23 for the Period Ending 11/30/22
https://www.otcmarkets.com/filing/conv_pdf?id=16312539&guid=f2s-kamb8rvDdth
Newtek Business Services Corp. Completes Acquisition of National Bank of New York City
Source: GlobeNewswire Inc.
Newtek Business Services Corp. (NASDAQ: NEWT) (“Newtek”) announced that on January 6, 2023, it completed its acquisition of the National Bank of New York City (“NBNYC”), a 59-year-old national bank regulated and supervised by the Office of the Comptroller of the Currency, and converted to a financial holding company. NBNYC has been renamed Newtek Bank, National Association™ (“Newtek Bank, N.A.”) and has become a wholly owned subsidiary of the Company. In addition, Newtek has filed with the Securities and Exchange Commission its notification of withdrawal of election to be subject to the Investment Company Act of 1940, and has ceased to be a business development company as of January 6, 2023. Within the next two weeks, Newtek will change its name from Newtek Business Services Corp. to NewtekOne, Inc.® and will retain its trading symbol (Nasdaq: NEWT). Additionally, in the coming weeks, Newtek will finalize its rebranding initiative, and will relaunch its redesigned corporate website. The Company intends to host conference calls in the coming weeks to discuss these initiatives and financial and operational targets in greater detail.
Barry Sloane, President, Chairman and CEO commented, “We are beyond thrilled to be announcing this momentous and much-anticipated occasion for Newtek, which we believe will benefit the Company’s growth in a significant way, in contrast to the limiting structure of operating as a BDC. Under our new financial holding company structure, we plan to capitalize on our long-standing business model, better serve our independent-business-owner clientele and enhance shareholder value in the marketplace as the One Solution for All of Your Business Needs®. NewtekOne® will position itself as a business solutions company offering a multitude of solutions to its clientele to enable them to become incrementally more successful and, as the parent of Newtek Bank, N.A., also offering our clientele depository services and solutions. As NewtekOne®, we plan to offer banking as a service and banking on demand, providing a unique offering to our independent business owner clientele who will be able to access their depository functions and money movement capabilities any time they need, as well as develop an invaluable partnership with NewtekOne® through which they can cultivate business relationships, as well as access advice, consultation, analytics and transactional capability. In addition, as NewtekOne® we believe we will be able to increase our ability to finance our growth, lower our cost of capital and retain earnings in contrast to our former structure as a business development company.”
Mr. Sloane continued, “We firmly believe that our ability to deliver superior products as a financial holding company and bank, as well as satisfy our client’s needs, will be materially enhanced, helping us improve the business prospects of independent business owners through our technology-enabled bank in a significant way. We plan to leverage NewtekOne’s patented technologies, including NewTracker® and The Newtek Advantage™ (patent pending). NewTracker®, our proprietary web-based referral system, enables us to cost effectively and remotely acquire customers through strategic alliance partnerships without the traditional use of branches, brokers, or business development officers. Furthermore, we believe The Newtek Advantage™ will allow us to offer our future banking clientele the relationships, analytics, software, and transactional capability that other banks simply do not offer. The Newtek Advantage™ will also allow Newtek clients to easily interact with six unique Newtek subject matter experts in the areas of banking, lending, payment processing, technology, payroll and insurance. These relationship managers will advise and consult with each client on their individual needs, and will be available via video conference, telephone, and email. We believe the Newtek Advantage™ through choice of an a la carte solution set and the ability to margin pool will enable us to grow core retail deposits and provide a tremendous advantage to our existing and new clients. In fact, we will evaluate licensing NewTracker®, the Newtek Advantage™ and other Newtek technologies that have been developed across all product lines to other financial institutions under their brand on a white-label basis. Newtek plans to provide a demonstration of the Newtek Advantage™, in conjunction with its rebranding strategy, during a conference call on Wednesday, January 18, 2023 at 8:30 am ET.”
Mr. Sloane concluded, “While we are proud of all we accomplished as a BDC, we believe converting to a financial holding company and owning a nationally chartered bank better fits the market landscape, both financially and operationally, for our clients and can provide increased opportunities for the Company to grow. With all the above-mentioned reasons, we believe this new structure can accelerate the Company’s future growth, enhance shareholder value and total return, and enable us to stand apart with our unique model and state-of-the-art technology. We look forward to continuing to capture the plethora of opportunities offered by the 32.5 million small businesses in the U.S, on a much larger scale in our new structure.”
Newtek Business Services Corp., Your Business Solutions Company®, is a financial holding company, which along with its bank and non-bank consolidated subsidiaries, provides a wide range of business and financial solutions under the Newtek® brand to the small- and medium-sized business (“SMB”) market. Since 1999, Newtek has provided state-of-the-art, cost-efficient products and services and efficient business strategies to SMB relationships across all 50 states to help them grow their sales, control their expenses and reduce their risk.
Newtek’s and its subsidiaries’ business and financial solutions include: banking (Newtek Bank, N.A.), Business Lending, SBA Lending Solutions, Electronic Payment Processing, Technology Solutions (Cloud Computing, Data Backup, Storage and Retrieval, IT Consulting), eCommerce, Accounts Receivable Financing & Inventory Financing, Insurance Solutions, Web Services, and Payroll and Benefits Solutions.
Newtek®, NewtekOne®, Newtek Bank, National AssociationTM, Your Business Solutions Company® and One Solution for All Your Business Needs® are registered trademarks of Newtek Business Services Corp.
Note Regarding Forward Looking Statements
This press release contains certain forward-looking statements. Words such as “believes,” “intends,” “expects,” “projects,” “anticipates,” “forecasts,” “goal” and “future” or similar expressions are intended to identify forward-looking statements. All forward-looking statements involve a number of risks and uncertainties that could cause actual results to differ materially from the plans, intentions and expectations reflected in or suggested by the forward-looking statements. Such risks and uncertainties include, among others, our ability to operate a bank and as a financial holding company, projections concerning or considering the pending Transaction, the timing of our ability to originate new investments, achieve certain margins and levels of profitability, the availability of additional capital and the ability to maintain certain debt to asset ratios, intensified competition, operating problems and their impact on revenues and profit margins, anticipated future business strategies and financial performance, anticipated future number of customers, business prospects, legislative developments and similar matters. Risk factors, cautionary statements and other conditions, which could cause Newtek’s actual results to differ from management’s current expectations, are contained in Newtek’s filings with the Securities and Exchange Commission and available through http://www.sec.gov/. Newtek cautions you that forward-looking statements are not guarantees of future performance and that actual results or developments may differ materially from those projected or implied in these statements.
SOURCE: Newtek Business Services Corp.
Investor Relations & Public Relations
Contact: Jayne Cavuoto
Telephone: (212) 273-8179 / jcavuoto@newtekone.com
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Disclosure Statement Pursuant to the Pink Basic Disclosure Guidelines
National Asset Recovery Corporation
A Nevada Corporation
50 West Liberty Street, Suite 880 Reno, NV 89501
SIC:1041
Quarterly Report
For the Period Ending: 09/30/22
(the “Reporting Period”)
https://www.otcmarkets.com/otcapi/company/financial-report/351075/content
https://www.otcmarkets.com/filing/html?id=16302923&guid=DWl-kn5GrJ2Pdth#ex991_htm
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________
FORM 8-K
______________
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): January 6, 2023
______________
HEALTHTECH SOLUTIONS, INC./UT
(Exact name of registrant as specified in its charter)
______________
Utah 0-51012 84-2528660
(State or Other Jurisdiction (Commission (I.R.S. Employer
of Incorporation) File Number) Identification No.)
181 Dante Avenue, Tuckahoe, New York 10707
(Address of Principal Executive Office) (Zip Code)
844-926-3399
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Trading Symbol(s) Name of each exchange on which registered
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ?
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ?
1
ITEM 7.01 REGULATION FD DISCLOSURE
On January 6, 2023, the President of Healthtech Solutions issued his annual letter to the shareholders and employees of Healthtech Solutions. A copy of the letter is furnished as Exhibit 99.1 to this current report.
The information in this Item 7.01 and Exhibit 99.1 hereto shall not be deemed “filed” for the purposes of or otherwise subject to the liabilities under Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Unless expressly incorporated into a filing by Healthtech Solutions under the Securities Act of 1933, as amended, or the Exchange Act, the information contained in this Item 7.01 and Exhibit 99.1 hereto shall not be incorporated by reference into any filing of the registrant, whether made before or after the date hereof, regardless of any general incorporation language in such filing.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS
Exhibits
99.1
Annual Letter to Shareholders dated January 6, 2023.
104 Cover page interactive data file (embedded within the iXBRL document)
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.
Healthtech Solutions, Inc.
Date: January 6, 2023
By:
/s/ Manuel E. Iglesias
Manuel E. Iglesias, President
2
HEALTHTECH SOLUTIONS, INC.
181 Dante Avenue
Tuckahoe, New York 10707
Annual letter to our shareholders and employees
Greetings:
As the new year emerges, I am using this occasion to reflect on the progress made by your company (“HLTT”) during 2022 and the prospects that we see for 2023. We ended 2021 as a medical technology incubator with only a series of scanning technologies, all of which were a distance from potential revenue. We ended 2022 with multiple profit centers already generating substantial revenue or poised to do so.
Our growth during 2022 can be understood as expansion in three integrated vectors: expansion of technology, expansion of skills, expansion of markets. I will summarize our principal accomplishments in each.
Technology: Acquisition of Wound Care IP.
In January 2022, HLTT acquired the assets of a Utah-based biomedical company related to production of wound care treatments. These assets included an FDA licensed manufacturing facility with equipment, intellectual property, including patents, related to wound care, and a skilled management team. The team included the Laboratory Director, the Chief Laboratory Officer, the Senior Vice President of Quality and Regulatory, and the Chief Medical Officer of the manufacturing lab facility.
In the Spring of 2022, we completed the licensing of our initial wound care product line and appointed World Reach Health, LLC (“WRH”), an experienced distributor of biomedical products (more on WRH below), to develop a market for our wound care products. That market produced its first sales in September 2022, and we reported net revenue of $776,221 for that month. We have recorded increased wound care revenue for each month in the fourth quarter of 2022, and we expect wound care revenue to continue to grow during 2023.
Skills: Acquisition of World Reach Health.
Our relationship with World Reach Health grew throughout 2022, as we saw the potential for mutual benefit to HLTT and to WRH from an enhanced relationship. Jelena Olmstead and Jim Pesoli, the owners and principals of WRH, each worked closely with HLTT management to build the HLTT wound care business. They were also instrumental in establishing our new CLIA lab (see below).
In December 2022, the growth of the relationship culminated in the execution of a binding contract under which HLTT will acquire 51% of the membership interest in World Reach Holdings, the parent company of World Reach Health (WRH). The closing will occur in January 2023. WRH is a distributor of biomedical products and medical devices. It sells directly to medical professionals and also has established a nationwide network of sub-distributors.
1
The acquisition will provide HLTT assurance of access to markets for the products and services that its subsidiaries develop. Of equal significance, the acquisition will bring into HLTT management the skills and experience provided by Jelena Olmstead and Jim Pesoli. At the closing of the World Reach Holdings transaction, Jelena will become the CEO and Jim the Senior Vice President of HLTT.
Jelena Olmstead. With over 20 years of experience in distribution of medical products and services, Jelena has familiarity with all continuums of care: Acute, LTC, Home Health, Hospice and Wound Care Clinics. Jelena was intimately involved in developing of annual sales strategies and plans, developing Wound Care processes, establishing best practices, and launching many emerging products into the market, while managing national sales and operations teams. Prior to organizing World Reach Health, Jelena served as Director of Business Development for NuMotion, which specialized in medical devices for mobility needs. Jelena was personally involved in the distribution of more than $1.5 billion worth of goods annually over the course of her career. Prior to joining NuMotion, Jelena was the Business Development Director and Key Account Manager for Invacare and for Joerns, both global healthcare manufacturers and distributors of DME and medical devices. Jelena was involved in a multitude of M&As throughout her career.
Jim Pesoli. Jim’s 15 years of experience as a healthcare-services executive and transactional attorney commenced when he began negotiating international manufacturing and distribution agreements for a variety of commodities and/or intellectual property rights. Later, he founded and eventually sold, Sonic Cleaning Services, which provided housekeeping and laundry services to nursing homes, assisted living facilities and healthcare institutions throughout the Midwest. Throughout his career, Jim has maintained close relationships with the distributors and manufacturers he represented or worked with. Additionally, as an entrepreneur, Jim has raised over $100 million in venture capital for a myriad of enterprises. Within World Reach Health, Jim has been instrumental in identifying and establishing strategic partnerships and brokering long-term purchasing agreements with product suppliers and purchasers around the globe.
WRH has ongoing contracts to distribute a number of products. These include Endurakit, a non-opiate surgical block for which WRH is one of four national distributors. WRH is the exclusive distributor for MY GEL, which is a neuropathy pain gel. WRH is also an approved distributor for some of the leading COVID-19 diagnostic tests, along with other diagnostic products, which are manufactured by AccessBio and Phase Scientific. WRH is a distributor of the Postday One-Step emergency contraceptive, and WRH is also an authorized distributor of Better Air, which provides organic probiotic air purification solutions. In this fashion, we expect WRH to provide a gateway to market for the products developed by HLTT subsidiaries as well as a source of additions to HLTT’s product list.
2
Markets: Organization of The Clia Lab.
Our current business plan points towards integration of complementary product and service lines, with the goal of maximizing the potential market for products and services developed by our subsidiaries. For example, WRH is well-established as a distributor in the rapid-testing market, which includes testing for Flu, Covid and Mersa. To optimize the opportunities presented by WRH’s presence in that market, the logical next step was to organize our own lab.
In the second half of 2022, therefore, we established an FDA-licensed CLIA laboratory, appropriately named “The CLIA Lab.” This facility is housed at the University of Utah technology campus in Salt Lake City.
The CLIA Lab is licensed to perform the Flu, Covid and Mersa tests that WRH has to date sold for other labs. It is also licensed to perform bacteria testing, providing a new revenue stream for WRH as well as a market advantage for HLTT’s wound care products. We expect to offer bundle packages to our wound care providers, which will include both the clinical test required prior to a wound care treatment as well as the wound care allograft that HLTT manufactures.
The View Forward
The acquisition of WRH later this month will provide HLTT a soup-to-nuts integration of the facilities required to develop biotechnical products and bring them to market. The only external input necessary for significant growth will be funding. Towards that end, management is in discussions with several broker-dealers with a view toward one or more of them sponsoring the uplist of HLTT’s shares to the NYSE American or NASDAQ. We plan to initiate the uplist process, soon after we file our 10-K Annual Report for 2022.
In sum, management expects 2023 to be HLTT‘s breakout year. We thank you for the support and dedication you have shown the company since 2020. We pledge to work tirelessly to assure that your confidence will be well rewarded.
Sincerely,
Manuel E Iglesias, President
Healthtech Solutions, Inc.
January 6, 2023
Disclosure Statement Pursuant to the Pink Basic Disclosure Guidelines The Metal Arts Company, Inc.
420 Lexington Avenue, Suite 300, New York, NY 10170 (212) 479-2580
SIC Code: 3999
Annual Report
For the Period Ending: June 30, 2022
https://www.otcmarkets.com/otcapi/company/financial-report/348607/content
CASTELLUM, INC.
FORM 10-Q
(Quarterly Report)
Filed 11/14/22 for the Period Ending 09/30/22
https://www.otcmarkets.com/filing/conv_pdf?id=16194686&guid=bSl-kqOqQls2dth
AIR TRANSPORT SERVICES GROUP, INC.
FORM 10-Q
(Quarterly Report)
Filed 11/09/22 for the Period Ending 09/30/22
https://www.otcmarkets.com/filing/conv_pdf?id=16186325&guid=bSl-kqOqQls2dth
Report of Foreign Issuer Pursuant to Rule 13a-16 or 15d-16 (6-k)
Source: Edgar (US Regulatory)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of October 2022
Commission File Number: 001-36515
Materialise NV
Technologielaan 15
3001 Leuven
Belgium
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F ? Form 40-F ?
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ?
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ?
This Form 6-K is incorporated by reference into the registrant’s Registration Statement on Form F-3 (File No. 333-213649).
Third Quarter 2022 Financial Results
Except as otherwise required by the context, references to “Materialise,” “Company,” “we,” “us” and “our” are to Materialise NV and its subsidiaries.
Third Quarter 2022 Results
Total revenue for the third quarter of 2022 increased 11.7% to 58,288 kEUR from 52,195 kEUR for the third quarter of 2021.
Revenue from our Materialise Software segment increased 3.8% to 10,863 kEUR for the third quarter of 2022 from 10,468 kEUR for the same quarter last year.
Revenue from our Materialise Medical segment increased 13.1% to 21,391 kEUR for the third quarter of 2022 compared to 18,910 kEUR for the same period in 2021.
Revenue from our Materialise Manufacturing segment increased 14.1% to 26,033 kEUR for the third quarter of 2022 from 22,817 kEUR for the third quarter of 2021.
Gross profit was 32,042 kEUR compared to 31,076 kEUR for the same period last year, while gross profit as a percentage of revenue decreased to 55.0% compared to 59.5% for the third quarter of 2021.
Research and development (“R&D”), sales and marketing (“S&M”) and general and administrative (“G&A”) expenses increased, in the aggregate, 24.5% to 33,491 kEUR for the third quarter of 2022 from 26,900 kEUR for the third quarter of 2021.
Net other operating income increased to 1,166 kEUR from 355 kEUR for the third quarter of 2021.
Operating result amounted to (282) kEUR compared to 4,529 kEUR for the third quarter of 2021.
Net financial result was 2,173 kEUR compared to 4,203 kEUR for the third quarter of 2021.
The third quarter of 2022 contained income tax expenses of (478) kEUR, compared to (75) kEUR in the third quarter of 2021.
As a result of the above, net profit for the third quarter of 2022 was 1,413 kEUR, compared to 8,657 kEUR for the same period in 2021. Total comprehensive income for the third quarter of 2022, which includes exchange differences on translation of foreign operations, was 1,638 kEUR compared to 8,272 kEUR for the 2021 period.
At September 30, 2022, we had cash and cash equivalents of 150,621 kEUR compared to 196,028 kEUR at December 31, 2021. Gross debt amounted to 83,925 kEUR, compared to 99,107 kEUR at December 31, 2021. As a result, our net cash position (cash and cash equivalents less gross debt) was 66,696 kEUR, a decrease of 30,225 kEUR, and included the effect of our call option exercise to acquire 100% of the shares of Link3D, and of our acquisition of Identify3D.
Cash flow from operating activities for the third quarter of the year 2022 was 3,840 kEUR compared to 4,388 kEUR for the same period in 2021. Total capital expenditures for the third quarter of 2022 amounted to 9,441 kEUR.
Net shareholders’ equity at September 30, 2022 was 236,559 kEUR compared to 232,577 kEUR at December 31, 2021.
Adjusted EBITDA amounted to 5,072 kEUR for the third quarter of 2022 compared to 9,739 kEUR for the 2021 period. The Adjusted EBITDA margin (Adjusted EBITDA divided by total revenue) for the third quarter of 2022 was 8.7%, compared to 18.7% for the third quarter of 2021.
Adjusted EBITDA from our Materialise Software segment decreased, including the effect of ongoing investments in Link3D and Identify3D, to 202 kEUR from 3,708 kEUR while the segment EBITDA margin (segment EBITDA divided by segment revenue) was 1.9% compared to 35.4% for the prior-year period.
Adjusted EBITDA from our Materialise Medical segment amounted to 4,765 kEUR for the third quarter of 2022 compared to 5,251 kEUR while the segment EBITDA margin was 22.3% compared to 27.8% for the third quarter of 2021.
Adjusted EBITDA from our Materialise Manufacturing segment amounted to 2,530 kEUR compared to 3,546 kEUR for the same period last year, while the segment EBITDA margin was 9.7% compared to 15.5% for the third quarter of 2021.
Non-IFRS Measures
Materialise uses EBITDA and Adjusted EBITDA as supplemental financial measures of its financial performance. EBITDA is calculated as net profit plus income taxes, financial expenses (less financial income), shares of profit or loss in a joint venture and depreciation and amortization. Adjusted EBITDA is determined by adding share-based compensation expenses, acquisition-related expenses of business combinations, impairments and revaluation of fair value due to business combinations to EBITDA. Management believes these non-IFRS measures to be important measures as they exclude the effects of items which primarily reflect the impact of long-term investment and financing decisions, rather than the performance of the company’s day-to-day operations. As compared to net profit, these measures are limited in that they do not reflect the periodic costs of certain capitalized tangible and intangible assets used in generating revenues in the company’s business, or the charges associated with impairments. Management evaluates such items through other financial measures such as capital expenditures and cash flow provided by operating activities. The company believes that these measurements are useful to measure a company’s ability to grow or as a valuation measurement. The company’s calculation of EBITDA and Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies. EBITDA and Adjusted EBITDA should not be considered as alternatives to net profit or any other performance measure derived in accordance with IFRS. The company’s presentation of EBITDA and Adjusted EBITDA should not be construed to imply that its future results will be unaffected by unusual or non-recurring items.
Exchange Rate
This document contains translations of certain euro amounts into U.S. dollars at specified rates solely for the convenience of readers. Unless otherwise noted, all translations from euros to U.S. dollars in this document were made at a rate of EUR 1.00 to USD 0.9748, the reference rate of the European Central Bank on September 30, 2022.
About Materialise
Materialise incorporates 30 years of 3D printing experience into a range of software solutions and 3D printing services, which form the backbone of the 3D printing industry. Materialise’s open and flexible solutions enable players in a wide variety of industries, including healthcare, automotive, aerospace, art and design, and consumer goods, to build innovative 3D printing applications that aim to make the world a better and healthier place. Headquartered in Belgium, with branches worldwide, Materialise combines one of the largest groups of software developers in the industry with one of the largest 3D printing facilities in the world.
Consolidated income statements (Unaudited)
for the three months ended
September 30, for the nine months ended
September 30,
In ‘000 2022 2022 2021(*) 2022 2021(*)
U.S.$ € € € €
Revenue
56,819 58,288 52,195 169,319 148,461
Cost of Sales
(25,584 ) (26,245 ) (21,119 ) (76,236 ) (64,378 )
Gross Profit
31,235 32,042 31,076 93,083 84,084
Gross profit as % of revenue
55.0 % 55.0 % 59.5 % 55.0 % 56.6 %
Research and development expenses
(9,078 ) (9,313 ) (6,602 ) (26,074 ) (19,982 )
Sales and marketing expenses
(14,815 ) (15,198 ) (12,413 ) (44,841 ) (35,730 )
General and administrative expenses
(8,754 ) (8,980 ) (7,885 ) (26,089 ) (23,449 )
Net other operating income (expenses)
1,137 1,166 355 2,603 2,318
Operating (loss) profit
(275 ) (282 ) 4,529 (1,318 ) 7,239
Financial expenses
(2,057 ) (2,110 ) 2,334 (4,671 ) (3,182 )
Financial income
4,175 4,283 1,869 9,800 4,426
Share in loss of joint venture
— — — — —
(Loss) profit before taxes
1,843 1,891 8,732 3,812 8,483
Income Taxes (*)
(466 ) (478 ) (75 ) (1,377 ) (101 )
Net (loss) profit for the period (*)
1,377 1,413 8,657 2,435 8,382
Net (loss) profit attributable to:
—
The owners of the parent
1,385 1,421 8,660 2,457 8,386
Non-controlling interest
(8 ) (8 ) (3 ) (21 ) (4 )
Earning per share attributable to owners of the parent
Basic (*)
0.02 0.02 0.15 0.04 0.15
Diluted (*)
0.02 0.02 0.15 0.04 0.15
Weighted average basic shares outstanding
59,064 59,064 58,731 59,064 55,935
Weighted average diluted shares outstanding
59,089 59,089 58,944 59,099 56,206
(*)
The year 2021 has been restated to reflect the final accounting of the business combination with RS Print. Impact on the nine months ended September 30 income taxes and net profit is (46)k€.
The year 2021 has been restated to reflect the final accounting of the business combination with RS Print. Impact on the three months ended September 30 income taxes and net profit is 5 k€.
Consolidated statements of comprehensive income (Unaudited)
for the three months ended
September 30, for the nine months ended
September 30,
In 000€ 2022 2022 2021(*) 2022 2021(*)
U.S.$ € € € €
Net profit (loss) for the period (*)
1,377 1,413 8,657 2,435 8,382
Other comprehensive income
Recycling
Exchange difference on translation of foreign operations
219 225 (385 ) 1,291 1,590
Non-recycling
Fair value adjustments through OCI - Equity instruments
— — — (0 ) 48
Other comprehensive income (loss), net of taxes
219 225 (385 ) 1,291 1,638
Total comprehensive income (loss) for the year, net of taxes
1,596 1,638 8,272 3,726 10,020
Total comprehensive income (loss) attributable to:
The owners of the parent
1,604 1,646 8,275 3,748 10,023
Non-controlling interests
(8 ) (8 ) (3 ) (21 ) (3 )
(*)
The year 2021 has been restated to reflect the final accounting of the business combination with RS Print. Impact on the nine months ended September 30 income taxes and net profit is (46)k€.
The year 2021 has been restated to reflect the final accounting of the business combination with RS Print. Impact on the three months ended September 30 income taxes and net profit is 5 k€.
Consolidated statement of financial position (Unaudited)
As of
September 30, As of
December 31,
In 000€ 2022 2021
Assets
Non-current assets
Goodwill
50,190 18,726
Intangible assets
38,710 31,668
Property, plant & equipment
92,335 84,451
Right-of-Use assets
8,520 9,054
Investments in joint ventures
— —
Deferred tax assets
217 227
Investments in convertible loans
3,431 3,560
Investments in non-listed equity instruments
399 399
Other non-current assets
4,948 7,520
Total non-current assets
198,750 155,605
Current assets
Inventories
15,532 11,295
Trade receivables
42,329 41,541
Other current assets
8,374 8,940
Cash and cash equivalents
150,621 196,028
Total current assets
216,856 257,803
Total assets
415,606 413,408
As of
September 30, As of
December 31,
In 000€ 2022 2021
Equity and liabilities
Equity
Share capital
4,487 4,489
Share premium
233,869 233,872
Retained earnings and other reserves
(1,797 ) (5,784 )
Equity attributable to the owners of the parent
236,559 232,577
Non-controlling interest
(21 ) 1
Total equity
236,538 232,578
Non-current liabilities
Loans & borrowings
58,126 72,637
Lease liabilities
5,004 5,268
Deferred tax liabilities
4,239 4,371
Deferred income
6,932 4,952
Other non-current liabilities
1,027 2,168
Total non-current liabilities
75,328 89,396
Current liabilities
Loans & borrowings
17,593 17,849
Lease liabilities
3,202 3,353
Trade payables
25,038 20,171
Tax payables
1,128 783
Deferred income
36,112 33,306
Other current liabilities
20,667 15,972
Total current liabilities
103,740 91,434
Total equity and liabilities
415,606 413,408
Consolidated statement of cash flows (Unaudited)
for the nine months ended
September 30,
In 000€ 2022 2021*
Operating activities
Net (loss) profit for the period (*)
2,435 8,382
Non-cash and operational adjustments
Depreciation of property plant & equipment
11,335 11,460
Amortization of intangible assets
4,859 3,780
Impairment of goodwill and intangible assets
— —
Share-based payment expense
(121 ) (878 )
Loss (gain) on disposal of property, plant & equipment
59 43
Movement in provisions
(506 ) 7
Movement reserve for bad debt and slow moving inventory
(42 ) 154
Financial income
(9,771 ) (4,426 )
Financial expense
5,009 3,182
Impact of foreign currencies
98 107
Share in loss (gain) of a joint venture (equity method)
— —
(Deferred) income taxes (*)
1,384 101
Other non-current liabilities
— —
Working capital adjustments
9,109 (4,531 )
Decrease (increase) in trade receivables and other receivables
(184 ) (7,553 )
Decrease (increase) in inventories and contracts in progress
(4,356 ) (1,770 )
Increase (decrease) in deferred revenue
3,815 (56 )
Increase (decrease) in trade payables and other payables
9,834 4,848
Income tax paid & Interest received
(262 ) 108
Net cash flow from operating activities
23,587 17,490
(*)
The year 2021 has been restated to reflect the final accounting of the business combination with RS Print. Impact on Net profit for the period and on (Deferred) income taxes is (46) k€.
for the nine months ended
September 30,
In 000€ 2022 2021
Investing activities
Purchase of property, plant & equipment
(16,066 ) (4,827 )
Purchase of intangible assets
(3,422 ) (2,439 )
Proceeds from the sale of property, plant & equipment & intangible assets (net)
319 295
Acquisition of subsidiary (net of cash)
(29,355 ) —
(Convertible) Loans granted
— 1,239
Investment in subsidiary, net of cash acquired
— (1,680 )
Net cash flow used in investing activities
(48,523 ) (7,412 )
Financing activities
Repayment of loans & borrowings
(15,182 ) (11,169 )
Repayment of leases
(2,566 ) (2,841 )
Capital increase
— 85,787
Interest paid
(1,665 ) (1,652 )
Other financial income (expense)
1,378 2,740
Net cash flow from (used in) financing activities
(18,035 ) 72,865
Net increase/(decrease) of cash & cash equivalents
(42,972 ) 82,943
Cash & Cash equivalents at the beginning of the year
196,028 111,538
Exchange rate differences on cash & cash equivalents
(2,433 ) 465
Cash & cash equivalents at end of the period
150,621 194,946
Reconciliation of Net Profit (Loss) to EBITDA and Adjusted EBITDA (Unaudited)
for the three months ended
September 30, for the nine months ended
September 30,
In 000€ 2022 2021 (*) 2022 2021 (*)
Net profit (loss) for the period (*)
1,413 8,657 2,435 8,382
Income taxes (*)
478 75 1,377 101
Financial expenses
2,110 (2,334 ) 4,671 3,182
Financial income
(4,283 ) (1,869 ) (9,800 ) (4,426 )
Depreciation and amortization
5,378 5,314 16,194 15,240
Share in loss of joint venture
— — — —
EBITDA
5,096 9,843 14,876 22,480
Share-based compensation expense (1)
(24 ) (104 ) (121 ) (878 )
Acquisition-related expenses of business combinations (2)
— — — 405
Adjusted EBITDA
5,072 9,739 14,755 22,007
(1)
Share-based compensation expense represents the cost of equity-settled and share-based payments to employees.
(2)
Acquisition-related expenses of business combinations represents expenses incurred in connection with the acquisition of our option to buy Link3D.
(*)
The year 2021 has been restated to reflect the final accounting of the business combination with RS Print. Impact on the nine months ended September 30 income taxes and net profit is (46)k€.
The year 2021 has been restated to reflect the final accounting of the business combination with RS Print. Impact on the three months ended September 30 income taxes and net profit is 5 k€.
Segment P&L (Unaudited)
In 000€ Materialise
Software Materialise
Medical Materialise
Manufacturing Total
segments Unallocated (1) Consolidated
For the three months ended September 30, 2022
Revenues
10,863 21,391 26,033 58,288 0 58,288
Segment (adj) EBITDA
202 4,765 2,530 7,497 (2,425 ) 5,072
Segment (adj) EBITDA %
1.9 % 22.3 % 9.7 % 12.9 % 8.7 %
For the three months ended September 30, 2021
Revenues
10,468 18,910 22,817 52,196 (0 ) 52,195
Segment (adj) EBITDA
3,708 5,251 3,546 12,506 (2,767 ) 9,739
Segment (adj) EBITDA %
35.4 % 27.8 % 15.5 % 24.0 % 18.7 %
In 000€ Materialise
Software Materialise
Medical Materialise
Manufacturing Total
segments Unallocated (1) Consolidated
For the nine months ended September 30, 2022
Revenues
31,989 60,592 76,739 169,319 0 169,319
Segment (adj) EBITDA
2,955 12,466 6,722 22,144 (7,388 ) 14,755
Segment (adj) EBITDA %
9.2 % 20.6 % 8.8 % 13.1 % 8.7 %
For the nine months ended September 30, 2021
Revenues
30,719 52,686 65,199 148,604 (142 ) 148,461
Segment (adj) EBITDA
10,266 14,313 5,252 29,831 (7,826 ) 22,004
Segment (adj) EBITDA %
33.4 % 27.2 % 8.1 % 20.1 % 14.8 %
(1)
Unallocated segment adjusted EBITDA consists of corporate research and development and corporate other operating income (expense), and the added share-based compensation expenses, acquisition related expenses of business combinations, impairments and fair value of business combinations that are included in Adjusted EBITDA.
Reconciliation of Net Profit (Loss) to Segment adjusted EBITDA (Unaudited)
for the three months ended
September 30, for the nine months ended
September 30,
In 000€ 2022 2021 (*) 2022 2021 (*)
Net profit (loss) for the period (*)
1,413 8,657 2,435 8,382
Income taxes (*)
478 75 1,377 101
Financial cost
2,110 (2,334 ) 4,671 3,182
Financial income
(4,283 ) (1,869 ) (9,800 ) (4,426 )
Share in loss of joint venture
— — — —
Operating (loss) profit
(282 ) 4,529 (1,318 ) 7,239
Depreciation and amortization
5,378 5,314 16,194 15,240
Corporate research and development
592 710 2,057 2,191
Corporate headquarter costs
2,491 2,463 7,103 6,907
Other operating income (expense)
(681 ) (511 ) (1,892 ) (1,745 )
Segment adjusted EBITDA
7,497 12,506 22,144 29,831
(*)
The year 2021 has been restated to reflect the final accounting of the business combination with RS Print. Impact on the nine months ended September 30 income taxes and net profit is (46)k€.
The year 2021 has been restated to reflect the final accounting of the business combination with RS Print. Impact on the three months ended September 30 income taxes and net profit is 5 k€.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
MATERIALISE NV
By:
/s/ Wilfried Vancraen
Name: Wilfried Vancraen
Title: Chief Executive Officer
Date: October 27, 2022