U.S. markets closed
  • S&P 500

    4,145.19
    -6.75 (-0.16%)
     
  • Dow 30

    32,803.47
    +76.67 (+0.23%)
     
  • Nasdaq

    12,657.55
    -63.04 (-0.50%)
     
  • Russell 2000

    1,921.82
    +15.36 (+0.81%)
     
  • Crude Oil

    88.53
    -0.01 (-0.01%)
     
  • Gold

    1,792.40
    -14.50 (-0.80%)
     
  • Silver

    19.86
    -0.26 (-1.30%)
     
  • EUR/USD

    1.0185
    -0.0065 (-0.63%)
     
  • 10-Yr Bond

    2.8400
    +0.1640 (+6.13%)
     
  • GBP/USD

    1.2070
    -0.0088 (-0.73%)
     
  • USD/JPY

    134.9700
    +1.9540 (+1.47%)
     
  • BTC-USD

    23,216.00
    +39.34 (+0.17%)
     
  • CMC Crypto 200

    533.20
    -2.02 (-0.38%)
     
  • FTSE 100

    7,439.74
    -8.32 (-0.11%)
     
  • Nikkei 225

    28,175.87
    +243.67 (+0.87%)
     

Benefitfocus Announces Second Quarter 2022 Financial Results

  • Oops!
    Something went wrong.
    Please try again later.
·18 min read
In this article:
  • Oops!
    Something went wrong.
    Please try again later.
Benefitfocus, Inc.
Benefitfocus, Inc.

Delivered on Second Quarter Financial Commitments

Executing on Transformational Plan to Return to Sustainable Growth

CHARLESTON, S.C., Aug. 03, 2022 (GLOBE NEWSWIRE) -- Benefitfocus, Inc. (NASDAQ: BNFT), an industry-leading cloud-based benefits administration technology company that simplifies benefits administration for employers, health plans and brokers, today announces its second quarter 2022 financial results:

Financial Highlights for the Second Quarter 2022:

  • Revenue of $56.6 million was at the high end of the guidance range of $55 to $57 million.

  • Adjusted EBITDA of $6.2 million was above the high end of the guidance range of $4 to $6 million.

  • GAAP net loss available to common stockholders was ($13.8) million, compared to ($16.6) million in the second quarter of 2021.

  • GAAP EPS was ($0.40) in the second quarter of 2022 and non-GAAP EPS was ($0.10).

Operational Highlights for the Second Quarter 2022:

  • Launched a new product called Claims Audit & Recovery Services, which is designed to analyze claims data to identify errors and waste, and seek reimbursement.

  • Entered into a strategic sales partnership with Lockton, expected to drive further penetration into the employer segment.

  • Appointed Ed Rumzis as our new Chief Technology Officer starting on August 8, adding another seasoned industry veteran to the leadership team.

“During the second quarter, the team continued to demonstrate a high say:do ratio against our three-pillar transformation plan.” said Benefitfocus President and Chief Executive Officer, Matt Levin. “We are establishing relationships with key players in the ecosystem and seeing early indicators that our go-to-market strategy is working, both a testament to our unwavering focus on service excellence.”

“We were once again able to deliver financial results at or better than our guidance ranges for this quarter,” said Alpana Wegner, Chief Financial Officer. “We are pleased with the progress we are making on executing our strategy to drive sustainable growth and are well-positioned to unlock long-term value for our shareholders.”

Second Quarter 2022 Financial Highlights
Revenue

  • Total revenue was $56.6 million, down approximately 7% compared to the second quarter of 2021.

  • Software services, which is comprised of both subscription and platform revenue, was $48.6 million, down 3% compared to the second quarter of 2021.

    • Subscription revenue was $42.0 million, down 5% compared to the second quarter of 2021.

    • Platform revenue was $6.6 million, up 12% compared to the second quarter of 2021.

  • Professional services revenue was $8.0 million, down 25% compared to the second quarter of 2021.

Net Loss

  • GAAP net loss was ($12.2) million, compared to ($15.0) million in the second quarter of 2021. GAAP net loss per share was ($0.40), based on ($13.8) million net loss available to common stockholders and 34.0 million basic and diluted weighted average common shares outstanding. This compares to GAAP net loss per share of ($0.50) for the second quarter of 2021, based on ($16.6) million net loss available to common stockholders and 33.1 million basic and diluted weighted average common shares outstanding.

Non-GAAP Net Loss, Adjusted EBITDA and Free Cash Flow

  • Non-GAAP net loss available to common stockholders was ($3.5) million for the second quarter of 2022, compared to ($5.9) million in the second quarter of 2021. Non-GAAP net loss per share was ($0.10) based on both 34.0 million basic and diluted weighted average common shares outstanding. This compares to non-GAAP net loss of ($0.18) in the second quarter of 2021, based on both 33.1 million basic and diluted weighted average common shares outstanding.

  • Adjusted EBITDA was $6.2 million, compared to $9.6 million in the second quarter of 2021.

  • Cash used in operations was ($0.7) million and free cash flow was ($2.1) million, compared to cash from operations of $9.2 million and $6.6 million of free cash flow in the second quarter of 2021.

See important disclosures about non-GAAP measures, and a reconciliation of them to GAAP, below.

Balance Sheet
Cash and cash equivalents at June 30, 2022, totaled $51.5 million, compared to cash and cash equivalents and marketable securities of $68.1 million at the end of the of 2021, a decline driven by the timing of working capital changes.

The full $50.0 million line of credit remains available to the company.

Business Outlook
Benefitfocus is providing guidance for the third quarter and full year 2022 as indicated below.

Third Quarter 2022

  • Total revenue is expected to be in the range of $55 million to $57 million.

  • Adjusted EBITDA is expected to be in the range of $4 million to $6 million.

  • Non-GAAP net loss available to common stockholders is expected to be between ($6.0) million and ($4.0) million, or between ($0.18) and ($0.12) per share based on 34.0 million basic and diluted weighted average shares outstanding.

Full-Year 2022

  • Total revenue is expected to be in the range of $252 million to $258 million.

  • Adjusted EBITDA is expected to be in the range of $44 million to $50 million.

  • Free cash flow is expected to be in the range of $18 million to $24 million.

Adjusted EBITDA and free cash flow guidance excludes the impact of restructuring and impairment charges.

Management has not reconciled forward-looking non-GAAP net loss, adjusted EBITDA or free cash flow to their most directly comparable GAAP measure of GAAP net loss or GAAP operating cash flows. This is because we cannot predict with reasonable certainty the ultimate outcome of the various necessary GAAP components of such reconciliations, including, for example, those related to certain impairment charges, acquisition transactions and integration, costs not core to our business or others that may arise during the year, without unreasonable effort. These components and other factors could materially impact the amount of future directly comparable GAAP measures, which may differ significantly from their non-GAAP counterparts. See below for additional important disclosures regarding our non-GAAP financial measures.

Conference Call Details:
In conjunction with this announcement, Benefitfocus will host a conference call to discuss the company’s financial results and business outlook on Wednesday, August 3, 2022, at 5:00 p.m. ET. To access this call, dial (800) 941-4658 (domestic) or +1 (416) 981-9033 (international). A live webcast of the conference call will be available on the Investor Relations page of the company’s website at http://investor.benefitfocus.com/. After the conference call, a replay will be available until August 10, 2022, at 11:59 p.m. ET and can be accessed by dialing (844) 512-2921 (domestic) or +1 (412) 317-6671 (international) with passcode 22019867.

About Benefitfocus
Benefitfocus (NASDAQ: BNFT) is a cloud-based benefits administration technology company committed to helping our customers, and the people they serve, get the most out of their health care and benefit programs. Through exceptional service and innovative SaaS solutions, we aim to be the safest set of hands for our customers helping to simplify the complexity of benefits administration while delivering an experience that engages people and unlocks the potential for better health and improved outcomes.  Our mission is simple: to improve lives with benefits.

Non-GAAP Financial Measures
The company uses certain non-GAAP financial measures in this release, including non-GAAP gross profit, operating income/loss, net loss/income, net loss/income per common share, adjusted EBITDA and free cash flow. Generally, a non-GAAP financial measure is a numerical measure of a company’s performance or financial position that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with GAAP.

Non-GAAP gross profit, operating income/loss, net loss/income and net loss/income per common share exclude stock-based compensation expenses, amortization of acquisition-related intangible assets, transaction and acquisition-related costs expensed, expense related to the impairment of goodwill, intangible assets and long-lived assets, gain or loss on extinguishment of debt, change in fair value of contingently returnable consideration and costs not core to our business. We define adjusted EBITDA as net loss before net interest, taxes, and depreciation and amortization expense, adjusted to eliminate stock-based compensation expense; transaction and acquisition-related costs expensed; restructuring costs; impairment of goodwill, intangible assets and long-lived assets; gain or loss on extinguishment of debt; other costs not core to our business; loss on settlement of lawsuits; and, now, changes in fair value of contingently returnable consideration. The revision to our definition of adjusted EBITDA had no impact on our reported adjusted EBITDA in prior periods. We define free cash flow as cash provided by or used in operating activities less capital expenditures, adjusted to eliminate cash paid for restructuring costs. Please note that other companies might define their non-GAAP financial measures differently than we do.

Management presents these non-GAAP financial measures in this release because it considers them to be important supplemental measures of performance. Management uses these non-GAAP financial measures for planning purposes, including analysis of the company's performance against prior periods, the preparation of operating budgets and to determine appropriate levels of operating and capital investments. Management believes that these non-GAAP financial measures provide additional insight for analysts and investors in evaluating the company's financial and operational performance. Management also intends to provide these non-GAAP financial measures as part of the company’s future earnings discussions and, therefore, their inclusion should provide consistency in the company’s financial reporting.

Non-GAAP financial measures have limitations as an analytical tool. Investors are encouraged to review the reconciliation of the non-GAAP measures to their most directly comparable GAAP measures provided in this release, including in the accompanying tables.

Safe Harbor Statement
Except for historical information, all of the statements, expectations, and assumptions contained in this press release are forward-looking statements. Actual results might differ materially from those explicit or implicit in the forward-looking statements. Important factors that could cause actual results to differ materially include: our need to increase sales and achieve consistent GAAP profitability; fluctuations in our financial results; our ability to maintain our culture and recruit, integrate and retain qualified personnel, including on our board of directors; our ability to compete effectively and implement our growth strategy; our reliance on channel relationships; market developments and opportunities; the need to innovate and provide useful products and services; risks related to changing healthcare and other applicable regulations; the immature and volatile nature of the market for our products and services; privacy; security and other risks associated with our business; management of growth; volatility and uncertainty in the global economy and financial markets in light of the evolving COVID-19 pandemic and war in Ukraine; and the other risk factors set forth from time to time in our SEC filings, copies of which are available free of charge within the Investor Relations section of the Benefitfocus website at http://investor.benefitfocus.com/sec-filings or upon request from our Investor Relations Department. Benefitfocus assumes no obligation and does not intend to update these forward-looking statements, except as required by law.

Source: Benefitfocus, Inc.

Media Contact:
843-981-8898
pr@benefitfocus.com

Investor Relations:
Doug Kuckelman
843-790-7460
ir@benefitfocus.com

 

 

Benefitfocus, Inc.
Unaudited Consolidated Statements of Operations and Comprehensive Loss
(in thousands, except share and per share data)

 

 

 

 

 

Three Months Ended
June 30,

 

 

Six Months Ended
June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Revenue

 

$

56,587

 

 

$

60,904

 

 

$

117,812

 

 

$

125,967

 

Cost of revenue(1)(2)

 

 

29,095

 

 

 

28,030

 

 

 

58,981

 

 

 

56,623

 

Gross profit

 

 

27,492

 

 

 

32,874

 

 

 

58,831

 

 

 

69,344

 

Operating expenses:(1)(2)(3)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales and marketing

 

 

10,643

 

 

 

10,921

 

 

 

20,567

 

 

 

21,812

 

Research and development

 

 

12,249

 

 

 

11,103

 

 

 

23,406

 

 

 

21,935

 

General and administrative

 

 

13,517

 

 

 

13,571

 

 

 

22,806

 

 

 

23,433

 

Impairment of lease right-of-use assets

 

 

1,769

 

 

 

4,003

 

 

 

1,769

 

 

 

4,003

 

Change in fair value of contingently returnable consideration

 

 

(719

)

 

 

 

 

 

(719

)

 

 

 

Restructuring costs

 

 

 

 

 

2,727

 

 

 

1,006

 

 

 

4,127

 

Total operating expenses

 

 

37,459

 

 

 

42,325

 

 

 

68,835

 

 

 

75,310

 

Loss from operations

 

 

(9,967

)

 

 

(9,451

)

 

 

(10,004

)

 

 

(5,966

)

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

 

72

 

 

 

54

 

 

 

84

 

 

 

111

 

Interest expense

 

 

(2,476

)

 

 

(5,646

)

 

 

(4,958

)

 

 

(11,201

)

Other income

 

 

236

 

 

 

64

 

 

 

482

 

 

 

22

 

 Total other expense, net

 

 

(2,168

)

 

 

(5,528

)

 

 

(4,392

)

 

 

(11,068

)

Loss before income taxes

 

 

(12,135

)

 

 

(14,979

)

 

 

(14,396

)

 

 

(17,034

)

Income tax expense

 

 

29

 

 

 

41

 

 

 

45

 

 

 

83

 

Net loss

 

 

(12,164

)

 

 

(15,020

)

 

 

(14,441

)

 

 

(17,117

)

Preferred dividends

 

 

(1,600

)

 

 

(1,600

)

 

 

(3,200

)

 

 

(3,200

)

Net loss available to common stockholders

 

$

(13,764

)

 

$

(16,620

)

 

$

(17,641

)

 

$

(20,317

)

Comprehensive loss

 

$

(12,164

)

 

$

(15,020

)

 

$

(14,441

)

 

$

(17,117

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss per common share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted

 

$

(0.40

)

 

$

(0.50

)

 

$

(0.52

)

 

$

(0.62

)

Weighted-average common shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted

 

 

34,028,422

 

 

 

33,080,257

 

 

 

33,764,103

 

 

 

32,787,162

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Stock-based compensation included in above line items:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of revenue

 

$

1,008

 

 

$

638

 

 

$

1,204

 

 

$

964

 

Sales and marketing

 

 

1,110

 

 

 

927

 

 

 

1,746

 

 

 

1,507

 

Research and development

 

 

783

 

 

 

503

 

 

 

1,014

 

 

 

621

 

General and administrative

 

 

2,414

 

 

 

2,308

 

 

 

2,540

 

 

 

2,807

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(2) Amortization of acquired intangible assets included in above line items:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of revenue

 

$

610

 

 

$

336

 

 

$

1,232

 

 

$

673

 

Sales and marketing

 

 

131

 

 

 

77

 

 

 

273

 

 

 

153

 

Research and development

 

 

233

 

 

 

113

 

 

 

449

 

 

 

226

 

General and administrative

 

 

99

 

 

 

43

 

 

 

192

 

 

 

85

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(3) Transaction and acquisition-related costs expensed included in above line items:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative

 

$

13

 

 

$

6

 

 

$

96

 

 

$

160

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


Benefitfocus, Inc.
Unaudited Consolidated Balance Sheets
(in thousands, except share and per share data)

 

 

 

 

 

As of
June 30,
2022

 

 

As of
December 31,
2021

 

Assets

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

51,497

 

 

$

31,001

 

Marketable securities

 

 

 

 

 

37,049

 

Accounts receivable, net

 

 

22,342

 

 

 

16,491

 

Contract, prepaid and other current assets

 

 

33,558

 

 

 

27,615

 

Total current assets

 

 

107,397

 

 

 

112,156

 

Property and equipment, net

 

 

26,048

 

 

 

27,202

 

Financing lease right-of-use assets

 

 

50,391

 

 

 

56,474

 

Operating lease right-of-use assets

 

 

669

 

 

 

774

 

Intangible assets, net

 

 

18,988

 

 

 

21,134

 

Goodwill

 

 

34,237

 

 

 

34,237

 

Deferred contract costs and other non-current assets

 

 

7,283

 

 

 

8,864

 

Total assets

 

$

245,013

 

 

$

260,841

 

Liabilities, redeemable preferred stock and stockholders' deficit

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

Accounts payable

 

$

5,298

 

 

$

10,565

 

Accrued expenses

 

 

17,546

 

 

 

9,451

 

Accrued compensation and benefits

 

 

11,557

 

 

 

16,411

 

Deferred revenue, current portion

 

 

27,808

 

 

 

27,756

 

Lease liabilities and financing obligations, current portion

 

 

6,387

 

 

 

7,378

 

Contingent consideration

 

 

 

 

 

675

 

Total current liabilities

 

 

68,596

 

 

 

72,236

 

Deferred revenue, net of current portion

 

 

2,464

 

 

 

2,377

 

Convertible senior notes

 

 

119,962

 

 

 

107,281

 

Lease liabilities and financing obligations, net current portion

 

 

74,184

 

 

 

75,758

 

Other non-current liabilities

 

 

372

 

 

 

313

 

Total liabilities

 

 

265,578

 

 

 

257,965

 

Commitments and contingencies

 

 

 

 

 

 

 

 

Redeemable preferred stock:

 

 

 

 

 

 

 

 

Series A preferred stock, par value $0.001, 5,000,000 shares
  authorized, 1,777,778 and 1,777,778 shares issued and outstanding
  at June 30, 2022 and December 31, 2021, respectively,
  liquidation preference $45 per share as of June 30, 2022 and December 31, 2021,
  respectively

 

 

79,193

 

 

 

79,193

 

Stockholders' deficit:

 

 

 

 

 

 

 

 

Common stock, par value $0.001, 95,000,000 shares authorized,
  34,172,079 and 33,460,545 issued and outstanding at June 30, 2022 and December
  31, 2021, respectively

 

 

34

 

 

 

33

 

Additional paid-in capital

 

 

382,204

 

 

 

431,874

 

Accumulated deficit

 

 

(481,996

)

 

 

(508,224

)

Total stockholders' deficit

 

 

(99,758

)

 

 

(76,317

)

   Total liabilities, redeemable preferred stock and stockholders' deficit

 

$

245,013

 

 

$

260,841

 

 

 

 

 

 

 

 

 

 


Benefitfocus, Inc.
Unaudited Consolidated Statements of Cash Flows
(in thousands)

 

 

 

 

 

Six Months Ended
June 30,

 

 

 

2022

 

 

2021

 

Cash flows from operating activities

 

 

 

 

 

 

 

 

Net loss

 

$

(14,441

)

 

$

(17,117

)

Adjustments to reconcile net loss to net cash (used in) provided by operating activities:

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

13,462

 

 

 

12,525

 

Stock-based compensation expense

 

 

6,504

 

 

 

5,899

 

Accretion of interest on convertible senior notes

 

 

377

 

 

 

5,780

 

Interest accrual on finance lease liabilities

 

 

22

 

 

 

3,244

 

Rent expense less than payments

 

 

(54

)

 

 

(27

)

Change in fair value of contingently returnable assets

 

 

(719

)

 

 

 

Non-cash accretion income from investments

 

 

29

 

 

 

506

 

Impairment or loss on disposal of right-of-use assets and property and equipment

 

 

1,769

 

 

 

4,048

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

Accounts receivable, net

 

 

(5,851

)

 

 

1,354

 

Accrued interest on investments

 

 

284

 

 

 

(101

)

Contract, prepaid and other current assets

 

 

4,016

 

 

 

2,410

 

Deferred costs and other non-current assets

 

 

1,582

 

 

 

1,249

 

Accounts payable and accrued expenses

 

 

(6,025

)

 

 

3,520

 

Accrued compensation and benefits

 

 

(4,853

)

 

 

(4,907

)

Deferred revenue

 

 

139

 

 

 

(615

)

Other non-current liabilities

 

 

60

 

 

 

159

 

Net cash (used in) provided by operating activities

 

 

(3,699

)

 

 

17,927

 

Cash flows from investing activities

 

 

 

 

 

 

 

 

Purchases of investments held-to-maturity

 

 

 

 

 

(48,427

)

Proceeds from short-term investments held-to-maturity

 

 

 

 

 

48,000

 

Maturities of investments available-for-sale

 

 

22,045

 

 

 

 

Sales of investments available-for-sale

 

 

14,691

 

 

 

 

Business combination, net of cash acquired

 

 

(500

)

 

 

 

Purchases of property and equipment

 

 

(3,911

)

 

 

(4,483

)

Net cash provided by (used in) investing activities

 

 

32,325

 

 

 

(4,910

)

Cash flows from financing activities

 

 

 

 

 

 

 

 

Payments of preferred dividends

 

 

(3,200

)

 

 

(3,200

)

Payments of contingent consideration

 

 

(675

)

 

 

 

Proceeds from exercises of stock options and ESPP

 

 

 

 

 

322

 

Payments on financing obligations

 

 

(2

)

 

 

(224

)

Payments of principal on finance lease liabilities

 

 

(4,253

)

 

 

(2,559

)

Net cash used in financing activities

 

 

(8,130

)

 

 

(5,661

)

Net increase in cash and cash equivalents

 

 

20,496

 

 

 

7,356

 

Cash and cash equivalents, beginning of period

 

 

31,001

 

 

 

90,706

 

Cash and cash equivalents, end of period

 

$

51,497

 

 

$

98,062

 

 

 

 

 

 

 

 

 

 

Supplemental disclosure of non-cash investing and financing activities

 

 

 

 

 

 

 

 

Property and equipment purchases in accounts payable and accrued expenses

 

$

52

 

 

$

 

 

 

 

 

 

 

 

 

 


Benefitfocus, Inc.
Unaudited Reconciliation of GAAP to Non-GAAP Measures
(in thousands, except share and per share data)

 

 

 

Three Months Ended
June 30,

 

 

Six Months Ended
June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Reconciliation from Gross Profit to Non-GAAP Gross Profit:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross profit

 

$

27,492

 

 

$

32,874

 

 

$

58,831

 

 

$

69,344

 

Amortization of acquired intangible assets

 

 

610

 

 

 

336

 

 

 

1,232

 

 

 

673

 

Stock-based compensation expense

 

 

1,008

 

 

 

638

 

 

 

1,204

 

 

 

964

 

Total net adjustments

 

 

1,618

 

 

 

974

 

 

 

2,436

 

 

 

1,637

 

Non-GAAP gross profit

 

$

29,110

 

 

$

33,848

 

 

$

61,267

 

 

$

70,981

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation from Operating Loss to Non-GAAP Operating Income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating loss

 

$

(9,967

)

 

$

(9,451

)

 

$

(10,004

)

 

$

(5,966

)

Amortization of acquired intangible assets

 

 

1,073

 

 

 

569

 

 

 

2,146

 

 

 

1,137

 

Stock-based compensation expense

 

 

5,315

 

 

 

4,376

 

 

 

6,504

 

 

 

5,899

 

Transaction and acquisition-related costs expensed

 

 

13

 

 

 

6

 

 

 

96

 

 

 

160

 

Impairment of lease right-of-use assets

 

 

1,769

 

 

 

4,003

 

 

 

1,769

 

 

 

4,003

 

Change in fair value of contingently returnable consideration

 

 

(719

)

 

 

 

 

 

(719

)

 

 

 

Costs not core to our business

 

 

2,800

 

 

 

1,717

 

 

 

4,755

 

 

 

3,598

 

Total net adjustments

 

 

10,251

 

 

 

10,671

 

 

 

14,551

 

 

 

14,797

 

Non-GAAP operating income

 

$

284

 

 

$

1,220

 

 

$

4,547

 

 

$

8,831

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation from Net Loss to Adjusted EBITDA:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

$

(12,164

)

 

$

(15,020

)

 

$

(14,441

)

 

$

(17,117

)

Depreciation

 

 

3,264

 

 

 

3,444

 

 

 

6,498

 

 

 

7,067

 

Amortization of software development costs

 

 

2,388

 

 

 

2,159

 

 

 

4,818

 

 

 

4,321

 

Amortization of acquired intangible assets

 

 

1,073

 

 

 

569

 

 

 

2,146

 

 

 

1,137

 

Interest income

 

 

(72

)

 

 

(54

)

 

 

(84

)

 

 

(111

)

Interest expense

 

 

2,476

 

 

 

5,646

 

 

 

4,958

 

 

 

11,201

 

Income tax expense

 

 

29

 

 

 

41

 

 

 

45

 

 

 

83

 

Stock-based compensation expense

 

 

5,315

 

 

 

4,376

 

 

 

6,504

 

 

 

5,899

 

Transaction and acquisition-related costs expensed

 

 

13

 

 

 

6

 

 

 

96

 

 

 

160

 

Impairment of lease right-of-use assets

 

 

1,769

 

 

 

4,003

 

 

 

1,769

 

 

 

4,003

 

Change in fair value of contingently returnable consideration

 

 

(719

)

 

 

 

 

 

(719

)

 

 

 

Restructuring costs

 

 

 

 

 

2,727

 

 

 

1,006

 

 

 

4,127

 

Costs not core to our business

 

 

2,800

 

 

 

1,717

 

 

 

4,755

 

 

 

3,598

 

Total net adjustments

 

 

18,336

 

 

 

24,634

 

 

 

31,792

 

 

 

41,485

 

Adjusted EBITDA

 

$

6,172

 

 

$

9,614

 

 

$

17,351

 

 

$

24,368

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation from Net Loss to Non-GAAP Net (Loss) Income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

$

(12,164

)

 

$

(15,020

)

 

$

(14,441

)

 

$

(17,117

)

Amortization of acquired intangible assets

 

 

1,073

 

 

 

569

 

 

 

2,146

 

 

 

1,137

 

Stock-based compensation expense

 

 

5,315

 

 

 

4,376

 

 

 

6,504

 

 

 

5,899

 

Transaction and acquisition-related costs expensed

 

 

13

 

 

 

6

 

 

 

96

 

 

 

160

 

Impairment of lease right-of-use assets

 

 

1,769

 

 

 

4,003

 

 

 

1,769

 

 

 

4,003

 

Change in fair value of contingently returnable consideration

 

 

(719

)

 

 

 

 

 

(719

)

 

 

 

Costs not core to our business

 

 

2,800

 

 

 

1,717

 

 

 

4,755

 

 

 

3,598

 

Total net adjustments

 

 

10,251

 

 

 

10,671

 

 

 

14,551

 

 

 

14,797

 

Non-GAAP net (loss) income

 

$

(1,913

)

 

$

(4,349

)

 

$

110

 

 

$

(2,320

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Calculation of Non-GAAP Earnings Per Share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-GAAP net (loss) income

 

$

(1,913

)

 

$

(4,349

)

 

$

110

 

 

$

(2,320

)

Preferred dividends

 

 

(1,600

)

 

 

(1,600

)

 

 

(3,200

)

 

 

(3,200

)

Non-GAAP net loss available to common stockholders

 

$

(3,513

)

 

$

(5,949

)

 

$

(3,090

)

 

$

(5,520

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding - basic and diluted

 

 

34,028,422

 

 

 

33,080,257

 

 

 

33,764,103

 

 

 

32,787,162

 

Shares used in computing non-GAAP net loss per share - basic
and diluted

 

 

34,028,422

 

 

 

33,080,257

 

 

 

33,764,103

 

 

 

32,787,162

 

Non-GAAP net loss per common share - basic and diluted

 

$

(0.10

)

 

$

(0.18

)

 

$

(0.09

)

 

$

(0.17

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of Cash Flows from Operations to Free Cash Flow:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net cash and cash equivalents (used in) provided by operating activities

 

$

(699

)

 

$

9,163

 

 

$

(3,699

)

 

$

17,927

 

Purchases of property and equipment

 

 

(1,901

)

 

 

(2,590

)

 

 

(3,911

)

 

 

(4,483

)

Cash paid for restructuring costs

 

 

518

 

 

 

5

 

 

 

1,304

 

 

 

1,384

 

Total net adjustments

 

 

(1,383

)

 

 

(2,585

)

 

 

(2,607

)

 

 

(3,099

)

Free Cash Flow

 

$

(2,082

)

 

$

6,578

 

 

$

(6,306

)

 

$

14,828