Delivers Strong Third Quarter
Results
Raises Guidance to Upper-End of Previous
Range
Announces $100 Million Share Repurchase
Authorization
Hostess Brands, Inc. (NASDAQ: TWNK, TWNKW) (the “Company”),
today reported its financial results for the three and nine months
ended September 30, 2020.
“We are very pleased with the double-digit revenue growth and
continued EBITDA margin expansion in the quarter driven by the
strong profit accretion from our Voortman business and continued
growth of the Hostess®-branded business. We are encouraged by the
steady return of the convenience channel and our achievement of
year-over-year growth in our single-serve business which continues
to reinforce the benefits of our operating model and ability to
better service this important consumer group,” commented Andy
Callahan, the Company's President and Chief Executive Officer. “We
are also very excited about our 2021 innovation slate which
establishes new platforms for incremental growth and we are
confident that the investments we are making to support our
continued growth momentum will drive increased shareholder value
over the long-term.”
Financial Highlights for the Third Quarter 2020 as Compared
to the Prior Year Period1
- Net revenue was $260.9 million, an increase of 18.5%*, driven
primarily by strong performance of recently acquired Voortman
Cookies Limited (“Voortman”) and Hostess® branded sales, partially
offset by lower private-label and other non-Hostess branded
sales.
- Gross profit was $91.2 million, an increase of 32.6%*. On an
adjusted basis, gross profit increased 23.9%* primarily due to the
accretive margin expansion generated from the successful
integration of Voortman and increased Hostess® branded sales.
- Net income was $24.0 million, or $0.18 per diluted share,
compared to $10.7 million, or $0.07 per diluted share, in the prior
year period. Adjusted net income increased $6.1 million, or 31.8%,
to $25.3 million, resulting in $0.19 adjusted EPS compared to $0.13
adjusted EPS in the prior year period. The increase in adjusted net
income and adjusted EPS was primarily due to the accretion from the
Voortman acquisition.
- Adjusted EBITDA was $60.2 million, or 23.1% of net revenue, an
increase of 29.2%*. The increase was primarily driven by Voortman's
adjusted EBITDA contribution and higher Hostess® branded
sales.
- Cash and cash equivalents were $152.3 million as of September
30, 2020 with a proforma leverage ratio of 4.0x after factoring in
the expected 2020 adjusted EBITDA contribution from Voortman.
∗ Excluding the In-Store Bakery business sold in 2019.
Operational Highlights for the Third Quarter
2020
- Developed exciting 2021 innovation slate which establishes
platforms for incremental future growth in both the sweet baked
goods and specialty better-for-you cookie segments with strong
initial sell-in performance.
- Achieved strong profit accretion from Voortman while continuing
to expand distribution following the completion of key integration
activities.
- Executed key operational changes including completion of a new
Donette production line during the third quarter in response to
continuously increasing consumer demand while keeping our
manufacturing and distribution facilities operational in the
challenging environment caused by the COVID pandemic.
- Total Hostess manufacturer point of sale increased 6.7% and
market share was 19.7% within the Sweet Baked Goods category driven
by 8.5% Hostess® branded point of sale growth, which was ahead of
the category growth of 7.5%.
Third Quarter 2020 Compared to Third Quarter 20191
Net revenue was $260.9 million, an increase of 14.8%, or $33.7
million, compared to $227.2 million. The increase in net revenue
was driven primarily by the acquisition of Voortman which
contributed $26.8 million of net revenue. Sweet baked goods net
revenue increased 6.3% or $13.9 million, primarily driven by higher
volume of core Hostess® branded products partially offset by lower
sales of private label and non-Hostess® branded products.
Gross profit was $91.2 million, or 35.0% of net revenue,
compared to $70.4 million, or 31.0% of net revenue. Adjusted gross
profit was $91.2 million, or 35.0% of net revenue, compared to
$75.2 million, or 33.1% of net revenue. Adjusted gross profit
increased 23.9%* as a result of accretion from Voortman supported
by achievement of synergies, lower promotional activity and higher
productivity efficiencies, partially offset by higher operating
costs due to COVID-19.
Operating costs and expenses were $49.8 million compared to
$46.8 million. The increase was primarily attributed to the
addition of Voortman's operating costs, including transition costs,
partially offset by prior-year charges totaling $5.8 million due to
costs related to the sale of the In-Store Bakery business, debt
refinancing costs, remeasurement of the tax receivable agreement
and costs related to the transition of the Company's primary
distribution center.
The Company's effective tax rate was 20.8% compared to 22.0%.
During the three months ended September 30, 2020, the effective tax
rate was impacted by a tax law change which resulted in a discrete
tax benefit of $1.2 million. During the three months ended
September 30, 2019, the effective tax rate was impacted by a
discrete tax benefit of $0.5 million related to the divestiture of
the In-Store Bakery operations.
Net income was $24.0 million compared to $10.7 million and EPS
was $0.18 per diluted share compared to $0.07 per diluted share.
Adjusted net income was $25.3 million compared to $19.2 million and
adjusted EPS was $0.19 compared to $0.13. Adjusted net income
increased as a result of the higher volume and increase in gross
profit noted above, partially offset by higher operating costs and
depreciation and amortization as a result of the Voortman
acquisition.
Adjusted EBITDA was $60.2 million, or 23.1% of net revenue,
compared to $47.8 million, or 21.0% of net revenue, an increase of
$12.4 million, or 25.9%. Excluding the impact of the In-store
Bakery Business, adjusted EBITDA increased $13.6 million or 29.2%.
The increase was driven by approximately $9.2 million of adjusted
EBITDA from Voortman and higher volume of core Hostess® branded
products.
Cash from operations for the nine months ended September 30,
2020 was $108.0 million compared to $107.4 million for the same
period last year. Operating cash flow benefited from the
incremental profits generated by Voortman as well as increased
sales of Hostess® branded products partially offset by cash used to
fund Voortman’s transaction and warehouse transition costs.
∗ Excluding the In-Store Bakery business sold in 2019.
2020 Outlook
Assuming there are no significant disruptions due to the COVID
pandemic, we have raised our expected consolidated financial
results for the full year 2020 to the upper-end of our previous
outlook as follows:
- Adjusted EBITDA of $235 million to $240 million (from previous
outlook of $230 million to $240 million), including Voortman
Adjusted EBITDA of $27 million to $30 million (from previous
outlook of $25 million to $30 million)
- Adjusted EPS of $0.73 to $0.75 (from previous outlook of $0.70
to $0.75)
- Leverage ratio of approximately 4x at the end of 2020
(consistent with previous outlook)
The Company reaffirms its long-term financial objectives of
organic revenue growth, adjusted EBITDA margins and free cash flow
conversion in the top-quartile of its peers.
The Company provides guidance only on a non-generally accepted
accounting principles (non-GAAP) basis and does not provide a
reconciliation of the Company's forward-looking financial
expectations to the most directly comparable GAAP financial measure
because of the inherent difficulty in forecasting and quantifying
certain amounts that are necessary for such reconciliation;
including adjustments that could be made for deferred taxes;
remeasurement of the Tax Receivable Agreement, changes in
allocation to the non-controlling interest, transformation expenses
and other non-operating gains or losses reflected in the Company's
reconciliation of historic non-GAAP financial measures, the amount
of which could be material. Please refer to the Reconciliation of
Non-GAAP Financial Measures included in this press release for
further information about the use of these measures.
Share Repurchase
The Company announced today that its Board of Directors has
approved a stock repurchase authorization of up to $100 million
shares of its Common Stock, to provide additional flexibility with
another avenue to generate shareholder value. The program has no
expiration date and acquired shares of the Class A common stock
will be held in treasury shares. The share repurchase program may
be amended, suspended or discontinued at any time at the Company's
discretion and does not commit the Company to repurchase shares of
its Class A common stock. The actual timing, number and value of
shares to be purchased under the program will be determined by the
Company at its discretion and will depend on a number of factors,
including the performance of the Company's stock price, general
market and other conditions, applicable legal requirements, and
compliance with the terms of the Company's outstanding
indebtedness.
Conference Call and Webcast
The Company will host a conference call and webcast with an
accompanying presentation today, November 5, 2020 at 4:30 p.m. EDT
to discuss the results for the third quarter. Investors interested
in participating in the live call can dial 877-451-6152 from the
U.S. and 201-389-0879 internationally. A telephone replay will be
available approximately two hours after the call concludes through
Thursday, November 19, 2020, by dialing 844-512-2921 from the U.S.,
or 412-317-6671 from international locations, and entering
confirmation code 13704985. The simultaneous, live webcast and
presentation will be available on the Investor Relations section of
the Company’s website at www.hostessbrands.com. The webcast will be
archived for 30 days.
About Hostess Brands, Inc.
Hostess Brands, Inc. is a leading packaged food company focused
on developing, manufacturing, marketing, selling and distributing
fresh baked sweet goods and cookies in North America. The Hostess®
brand's history dates back to 1919, when the Hostess® CupCake was
introduced to the public, followed by Twinkies® in 1930. Today, the
Company produces a variety of new and classic treats in addition to
Twinkies® and CupCakes, including Donettes®, Ding Dongs®, Zingers®,
Danishes, Honey Buns and Coffee Cakes. In January 2020, the Company
acquired Voortman Cookies Limited which produces a variety of
cookies and wafers products, including sugar-free products under
the Voortman® brand. For more information about Hostess® products
and Hostess Brands, please visit hostesscakes.com. Follow Hostess
on Twitter: @Hostess_Snacks; on Facebook: facebook.com/Hostess; on
Instagram: Hostess_Snacks; and on Pinterest:
pinterest.com/hostesscakes.
The Company has one reportable segment: Snacking (formerly
referred to as Sweet Baked Goods, or “SBG”). The Snacking segment
consists of sweet baked goods, cookies, bread and buns and frozen
retail products that are sold under the Hostess®, Dolly Madison®,
Cloverhill®, Big Texas®, and Voortman® brands. Through August 30,
2019, we operated in two reportable segments: SBG and In-Store
Bakery (“ISB”). The In-Store Bakery segment consisted of Superior
on Main® and private label products sold through the in-store
bakery section of grocery and club stores. The Company divested its
In-Store Bakery segment's operations on August 30, 2019.
Forward-Looking Statements
This press release contains statements reflecting the Company's
views about its future performance that constitute “forward-looking
statements” within the meaning of Section 27A of the Securities Act
of 1933, as amended and Section 21E of the Securities Exchange Act
of 1934, as amended, that involve substantial risks and
uncertainties. Forward-looking statements are generally identified
through the inclusion of words such as “believes,” “expects,”
“intends,” “estimates,” “projects,” “anticipates,” “will,” “plan,”
“may,” “should,” or similar language. Statements addressing the
Company's future operating performance and statements addressing
events and developments that the Company expects or anticipates
will occur are also considered as forward-looking statements. All
forward-looking statements included herein are made only as of the
date hereof. The Company undertakes no obligation to update any
forward-looking statement, whether as a result of new information,
future events, or otherwise.
These statements inherently involve risks and uncertainties that
could cause actual results to differ materially from those
anticipated in such forward-looking statements. These risks and
uncertainties include, but are not limited to, maintaining,
extending and expanding the Company's reputation and brand image;
protecting intellectual property rights; leveraging the Company's
brand value to compete against lower-priced alternative brands;
correctly predicting, identifying and interpreting changes in
consumer preferences and demand and offering new products to meet
those changes; operating in a highly competitive industry; the
ability to maintain or add additional shelf or retail space for the
Company's products; the continued ability to produce and
successfully market products with extended shelf life; our ability
to successfully integrate, achieve expected synergies and manage
our acquired businesses and brands; the ability to drive revenue
growth in key products or add products that are faster-growing and
more profitable; volatility in commodity, energy, and other input
prices and the ability to adjust pricing to cover increased costs;
dependence on major customers; geographic focus could make the
Company particularly vulnerable to economic and other events and
trends in North America; increased costs in order to comply with
governmental regulation; general political, social and economic
conditions; a portion of the workforce belongs to unions and
strikes or work stoppages could cause the business to suffer;
product liability claims, product recalls, or regulatory
enforcement actions; unanticipated business disruptions; dependence
on third parties for significant services; insurance may not
provide adequate levels of coverage against claims; failures,
unavailability, or disruptions of the Company's information
technology systems; dependence on key personnel or a highly skilled
and diverse workforce; and the Company's ability to finance
indebtedness on terms favorable to the Company; and other risks as
set forth from time to time in the Company's Securities and
Exchange Commission filings.
As a result of a number of known and unknown risks and
uncertainties, the Company's actual results or performance may be
materially different from those expressed or implied by these
forward-looking statements. Risks and uncertainties are identified
and discussed in Item 1A-Risk Factors in the Company's Annual
Report on Form 10-K for 2019 and its Quarterly Report on Form 10-Q
for the quarter ended September 30, 2020 to be filed today. The
impact of COVID-19 may also exacerbate these risks, any of which
could have a material effect on the Company. This situation is
changing rapidly and additional impacts may arise that the Company
is not aware of currently. All subsequent written or oral
forward-looking statements attributable to us or persons acting on
the Company's behalf are expressly qualified in their entirety by
these risk factors. The Company undertakes no obligation to update
any forward-looking statement, whether as a result of new
information, future events, or otherwise.
1This press release contains certain non-GAAP financial
measures, including adjusted revenue, adjusted gross profit,
adjusted gross margin, adjusted operating income, adjusted EBITDA,
adjusted net income, adjusted net income attributed to Class A
stockholders and adjusted earnings per share (“EPS”). Please refer
to the schedules in the press release for reconciliations of
non-GAAP financial measures to the comparable GAAP measure. Unless
otherwise stated, all comparisons of financial measures in this
press release are to the third quarter of 2019. All measures of
market performance contained in this press release, including point
of sale and market share include all Company branded products
within the SBG category as reported by Nielsen but do not include
other products sold outside of the SBG category. All market data in
this press release refer to the 13 week period ended September 26,
2020. All market data in this press release reflect the restatement
of historical convenience channel data executed by Nielsen during
2020. The Company's proforma leverage ratio is net debt (total
long-term debt less cash) divided by the trailing twelve months
adjusted EBITDA (including $27.0 million of full-year 2020 Voortman
EBITDA).
HOSTESS BRANDS, INC.
CONSOLIDATED BALANCE
SHEETS
(Unaudited, amounts in
thousands, except shares and per share data)
September 30,
2020
December 31,
2019
ASSETS
Current assets:
Cash and cash equivalents
$
152,297
$
285,087
Accounts receivable, net
136,930
104,892
Inventories
47,710
47,608
Prepaids and other current assets
20,116
15,569
Total current assets
357,053
453,156
Property and equipment, net
284,118
242,384
Intangible assets, net
1,974,081
1,853,315
Goodwill
707,132
535,853
Other assets, net
17,459
12,993
Total assets
$
3,339,843
$
3,097,701
LIABILITIES AND STOCKHOLDERS’
EQUITY
Current liabilities:
Long-term debt and lease obligations
payable within one year
$
13,097
$
11,883
Tax receivable agreement payments payable
within one year
9,100
12,100
Accounts payable
60,096
68,566
Customer trade allowances
57,059
45,715
Accrued expenses and other current
liabilities
57,020
21,661
Total current liabilities
196,372
159,925
Long-term debt and lease obligations
1,106,374
975,405
Tax receivable agreement obligations
128,355
126,096
Deferred tax liability
298,387
256,051
Other long-term liabilities
1,340
—
Total liabilities
1,730,828
1,517,477
Class A common stock, $0.0001 par value,
200,000,000 shares authorized, 125,149,257 and 122,108,086 shares
issued and outstanding at September 30, 2020 and December 31, 2019,
respectively
12
12
Class B common stock, $0.0001 par value,
50,000,000 shares authorized, 5,622,149 and 8,409,834 shares issued
and outstanding at September 30, 2020 and December 31, 2019,
respectively
1
1
Additional paid in capital
1,185,003
1,152,055
Accumulated other comprehensive loss
(11,004)
(756)
Retained earnings
375,603
334,480
Stockholders’ equity
1,549,615
1,485,792
Non-controlling interest
59,400
94,432
Total liabilities and stockholders’
equity
$
3,339,843
$
3,097,701
HOSTESS BRANDS, INC.
CONSOLIDATED STATEMENTS OF
OPERATIONS
(Unaudited, amounts in
thousands, except shares and per share data)
Three Months Ended
Nine Months Ended
September 30, 2020
September 30, 2019
September 30, 2020
September 30, 2019
Net revenue
$
260,855
$
227,211
$
760,566
$
691,009
Cost of goods sold
169,700
156,791
500,700
461,951
Gross profit
91,155
70,420
259,866
229,058
Operating costs and expenses:
Advertising and marketing
11,762
10,627
32,983
30,186
Selling expense
8,675
6,992
39,173
23,822
General and administrative
21,913
17,736
71,261
54,483
Amortization of customer relationships
6,739
5,755
20,333
17,749
Business combination transaction costs
—
—
4,282
—
Other operating expense
729
5,739
756
6,256
Total operating costs and expenses
49,818
46,849
168,788
132,496
Operating income
41,337
23,571
91,078
96,562
Other expense:
Interest expense, net
10,265
9,813
32,570
30,351
Other expense
818
—
2,503
1,286
Total other expense
11,083
9,813
35,073
31,637
Income before income taxes
30,254
13,758
56,005
64,925
Income tax expense
6,281
3,029
12,022
10,915
Net income
23,973
10,729
43,983
54,010
Less: Net income attributable to the
non-controlling interest
1,368
1,944
2,860
12,615
Net income attributable to Class A
stockholders
$
22,605
$
8,785
$
41,123
$
41,395
Earnings per Class A share:
Basic
$
0.18
$
0.08
$
0.33
$
0.39
Diluted
$
0.18
$
0.07
$
0.33
$
0.37
Weighted-average shares outstanding:
Basic
124,905,538
115,196,195
123,901,333
106,904,733
Diluted
127,586,881
121,122,895
126,090,645
110,804,367
Results of
Operations by Segment
Three Months Ended
Nine Months Ended
(In thousands)
September 30, 2020
September 30, 2019
September 30, 2020
September 30, 2019
Net Revenue
Snacking
$
260,855
$
220,156
$
760,566
$
662,307
In-Store Bakery
—
7,055
—
28,702
$
260,855
$
227,211
$
760,566
$
691,009
Gross Profit
Snacking
$
91,155
$
68,804
$
259,866
$
222,872
In-Store Bakery
—
1,616
—
6,186
$
91,155
$
70,420
$
259,866
$
229,058
HOSTESS BRANDS, INC.
CONSOLIDATED STATEMENTS OF
CASH FLOWS
(Unaudited, amounts in
thousands)
Nine Months Ended
September 30, 2020
September 30, 2019
Operating activities
Net income
$
43,983
$
54,010
Depreciation and amortization
40,999
32,678
Impairment of property, goodwill and
intangibles
—
1,005
Debt discount (premium) amortization
977
(803)
Tax receivable agreement remeasurement
610
1,296
Non-cash fees on disposal of assets
—
1,414
Unrealized foreign exchange losses
1,392
—
Non-cash lease expense
358
—
Share-based compensation
6,583
7,157
Deferred taxes
8,575
9,519
Loss on sale of assets
317
471
Change in operating assets and
liabilities, net of acquisitions and dispositions:
Accounts receivable
(7,106)
(13,536)
Inventories
7,462
(3,451)
Prepaids and other current assets
(4,334)
(3,793)
Accounts payable and accrued expenses
2,186
18,305
Customer trade allowances
5,989
3,080
Net cash provided by operating
activities
107,991
107,352
Investing activities
Purchases of property and equipment
(33,382)
(28,421)
Acquisition of business, net of cash
acquired
(316,013)
—
Proceeds from sale of business, net of
cash
—
63,353
Acquisition and development of software
assets
(4,994)
(4,298)
Net cash provided by (used in) investing
activities
(354,389)
30,634
Financing activities
Repayments of long-term debt and lease
obligations
(8,375)
(7,470)
Proceeds from long-term debt origination,
net of fees paid
136,888
—
Distributions to non-controlling
interest
(3,423)
(6,659)
Tax payments related to issuance of shares
to employees
(1,383)
(607)
Cash received from exercise of options and
warrants
565
23
Payments on tax receivable agreement
(10,327)
(2,779)
Net cash provided by (used in) financing
activities
113,945
(17,492)
Effect of exchange rate changes on cash
and cash equivalents
(337)
—
Net increase (decrease) in cash and
cash equivalents
(132,790)
120,494
Cash and cash equivalents at beginning of
period
285,087
146,377
Cash and cash equivalents at end of
period
$
152,297
$
266,871
Supplemental Disclosures of Cash Flow
Information:
Cash paid during the period for:
Interest
$
31,883
$
33,602
Net taxes paid
$
5,403
$
2,416
Supplemental disclosure of non-cash
investing:
Accrued capital expenditures
$
3,124
$
1,468
HOSTESS BRANDS, INC.
RECONCILIATION OF NON-GAAP FINANCIAL
MEASURES
Adjusted net revenue, adjusted gross profit, adjusted operating
income, adjusted net income, adjusted Class A net income, adjusted
EBITDA and adjusted EPS collectively referred to as “Non-GAAP
Financial Measures,” are commonly used in the Company's industry
and should not be construed as an alternative to net revenue, gross
profit, operating income, net income, net income attributed to
Class A stockholders or earnings per share as indicators of
operating performance (as determined in accordance with GAAP).
These Non-GAAP Financial Measures may not be comparable to
similarly titled measures reported by other companies. The Company
has included these Non-GAAP Financial Measures because it believes
the measures provide management and investors with additional
information to measure the Company's performance, estimate the
Company's value and evaluate the Company's ability to service
debt.
Non-GAAP Financial Measures are adjusted to exclude certain
items that affect comparability. The adjustments are itemized in
the tables below. You are encouraged to evaluate these adjustments
and the reason the Company considers them appropriate for
supplemental analysis. In evaluating adjustments, you should be
aware that in the future the Company may incur expenses that are
the same as or similar to some of the adjustments set forth below.
The presentation of Non-GAAP Financial Measures should not be
construed as an inference that future results will be unaffected by
unusual or recurring items.
The Company defines adjusted EBITDA as net income adjusted to
exclude (i) interest expense, net, (ii) depreciation and
amortization (iii) income taxes and (iv) share-based compensation,
as further adjusted to eliminate the impact of certain items that
the Company does not consider indicative of its ongoing operating
performance. Adjusted EBITDA has limitations as an analytical tool,
and you should not consider it in isolation, or as a substitute for
analysis of the Company's results as reported under GAAP. For
example, adjusted EBITDA:
- does not reflect the Company's capital expenditures, future
requirements for capital expenditures or contractual
commitments;
- does not reflect changes in, or cash requirements for, the
Company's working capital needs;
- does not reflect the significant interest expense, or the cash
requirements necessary to service interest or principal payments,
on the Company's debt; and
- does not reflect payments related to income taxes, the Tax
Receivable Agreement or distributions to the non-controlling
interest to reimburse its tax liability.
HOSTESS BRANDS, INC.
RECONCILIATION OF NON-GAAP FINANCIAL
MEASURES
(Unaudited, amounts in thousands, except
shares and per share data)
Three Months Ended September
30, 2020
Net Revenue
Gross Profit
Operating Income
Net Income
Class A Net Income
Diluted EPS
GAAP Results
$
260,855
$
91,155
$
41,337
$
23,973
$
22,605
$
0.18
Non-GAAP adjustments:
Foreign currency impacts
—
—
—
398
378
—
Acquisition, disposal and integration
related costs (1)
—
—
1,556
1,556
1,478
0.01
Tax Receivable Agreement remeasurement
—
—
610
610
610
0.01
Other
—
—
120
541
514
—
Remeasurement of tax liabilities
—
—
—
(1,222)
(1,222)
(0.01)
Tax impact of adjustments
—
—
—
(601)
(601)
—
Adjusted Non-GAAP results
$
260,855
$
91,155
$
43,623
25,255
$
23,762
$
0.19
Income tax
8,104
Interest expense
10,265
Depreciation and amortization
14,522
Share-based compensation
2,080
Adjusted EBITDA
$
60,226
(1) Acquisition, disposal and integration operating costs are
included in general and administrative expenses on the consolidated
statement of operations.
Three Months Ended September
30, 2019
Net Revenue
Gross Profit
Operating Income
Net Income
Class A Net Income
Diluted EPS
GAAP Results
$
227,211
$
70,420
$
23,571
$
10,729
$
8,785
$
0.07
Non-GAAP adjustments:
Acquisition, disposal and integration
related costs
—
—
1,995
1,995
1,762
0.01
Facility transition costs (1)
—
4,816
5,347
5,347
4,722
0.05
Tax Receivable Agreement remeasurement
—
—
1,779
1,779
1,779
0.01
Impairment of property and equipment,
intangible assets and goodwill
—
—
471
471
416
—
Other
—
—
1,493
1,493
1,318
0.01
Remeasurement of deferred taxes
—
—
—
(448)
(448)
—
Tax impact of adjustments
—
—
—
(2,158)
(2,158)
(0.02)
Adjusted Non-GAAP results
$
227,211
$
75,236
$
34,656
$
19,208
$
16,176
$
0.13
Income tax
5,635
Interest expense
9,813
Depreciation and amortization
10,739
Share-based compensation
2,377
Adjusted EBITDA
$
47,772
(1) Facility transition operating costs are included in general
and administrative expenses on the consolidated statement of
operations.
Nine Months Ended September
30, 2020
Net Revenue
Gross Profit
Operating Income
Net Income
Class A Net Income
Diluted EPS
GAAP Results
$
760,566
$
259,866
$
91,078
$
43,983
41,123
$
0.33
Non-GAAP adjustments:
Foreign currency impacts
—
—
—
1,394
1,317
0.01
Acquisition, disposal and integration
related costs (1)
6,821
7,963
28,857
28,857
27,270
0.22
Facility transition costs
—
3,681
5,710
5,710
5,396
0.04
Tax Receivable Agreement remeasurement
—
—
610
610
610
—
COVID-19 Costs (2)
—
2,082
2,388
2,388
2,257
0.02
Other
—
—
100
1,217
1,150
0.01
Remeasurement of tax liabilities
—
—
—
(1,222)
(1,222)
(0.01)
Tax impact of adjustments
—
—
—
(9,894)
(9,894)
(0.08)
Adjusted Non-GAAP results
$
767,387
$
273,592
$
128,743
$
73,043
$
68,007
$
0.54
Income tax
23,138
Interest expense
32,570
Depreciation and amortization
40,999
Share-based compensation
6,582
Adjusted EBITDA
$
176,332
(1) Acquisition, disposal and integration operating costs
include $8.0 million of selling expense, $8.6 million of general
and administrative expenses and $4.3 million of business
combination transaction costs on the consolidated statement of
operations.
(2) COVID-19 operating costs are included in general and
administrative expenses on the consolidated statement of
operations. Total COVID-19 non-GAAP adjustments primarily consist
of costs of incremental cleaning and sanitation, personal
protective equipment and employee bonuses.
Nine Months Ended September
30, 2019
Net Revenue
Gross Profit
Operating Income
Net Income
Class A Net Income
Diluted EPS
GAAP Results
$
691,009
$
229,058
$
96,562
$
54,010
41,395
$
0.37
Non-GAAP adjustments:
Acquisition, disposal and integration
related costs
—
1,563
3,558
3,558
3,049
0.03
Special employee incentive compensation
(1)
—
33
1,910
1,910
1,637
0.01
Facility transition costs (1)
—
4,816
6,163
6,163
5,282
0.05
Tax Receivable Agreement remeasurement
—
—
1,296
1,296
1,296
0.01
Impairment of property and equipment,
intangible assets and goodwill
—
—
1,476
1,476
1,265
0.01
Other
—
—
1,493
2,773
2,377
0.02
Remeasurement of deferred taxes
—
—
—
(3,672)
(3,672)
(0.03)
Tax impact of adjustments
—
—
—
(3,495)
(3,495)
(0.03)
Adjusted Non-GAAP results
$
691,009
$
235,470
$
112,458
$
64,019
49,134
$
0.44
Income tax
18,082
Interest expense
30,351
Depreciation and amortization
32,678
Share-based compensation
7,157
Adjusted EBITDA
$
152,287
(1) Special employee incentive compensation and facility
transition operating costs are included general and administrative
expenses on the consolidated statement of operations.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20201105006079/en/
Investors, please contact: Chris Mandeville and Anna Kate Heller
ICR 203-682-8304 Chris.Mandeville@icrinc.com and
AnnaKate.Heller@icrinc.com
Media, please contact: Hannah Arnold LAK Public Relations, Inc.
212-329-1417 harnold@lakpr.com or Marie Espinel LAK Public
Relations, Inc. 212-899-4744 mespinel@lakpr.com
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