INNOVATE Corp. (“INNOVATE” or the “Company”) (NYSE: VATE) announced
today its consolidated results for the second quarter.
Financial Summary
(in millions, except per share
amounts) |
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
2023 |
|
2022 |
|
Increase / (Decrease) |
|
2023 |
|
2022 |
|
Increase / (Decrease) |
Revenue |
$ |
368.8 |
|
|
$ |
392.2 |
|
|
(6.0 |
)% |
|
$ |
686.7 |
|
|
$ |
805.0 |
|
|
(14.7 |
)% |
Net loss attributable to
common stockholders |
$ |
(10.5 |
) |
|
$ |
(13.6 |
) |
|
22.8 |
% |
|
$ |
(20.7 |
) |
|
$ |
(27.2 |
) |
|
23.9 |
% |
Basic and Diluted loss per
share - Net loss attributable to common stockholders |
$ |
(0.13 |
) |
|
$ |
(0.18 |
) |
|
27.8 |
% |
|
$ |
(0.27 |
) |
|
$ |
(0.35 |
) |
|
22.9 |
% |
Total Adjusted EBITDA(1) |
$ |
16.5 |
|
|
$ |
12.1 |
|
|
36.4 |
% |
|
$ |
21.4 |
|
|
$ |
23.6 |
|
|
(9.3 |
)% |
(1) Reconciliation of GAAP to Non-GAAP measures
follows
Commentary“INNOVATE reported
strong second quarter results with revenue of $368.8 million
and adjusted EBITDA of $16.5 million, as our operating
segments are capitalizing on attractive market opportunities," said
Avie Glazer, Chairman of INNOVATE. “The strength in the second
quarter was driven by INNOVATE's Infrastructure segment which
expanded adjusted EBITDA margin by approximately 100 basis points.
We also remain excited by developments and opportunities in the
Life Sciences segment as MediBeacon completed the Phase 3
Transdermal GFR Pivotal Study and filed the Clinical Study Report
with FDA. At Spectrum, adjusted EBITDA grew both sequentially and
year-over-year."
"We are deeply saddened by Wayne Barr's passing
and greatly appreciate his leadership and many significant
contributions to INNOVATE. Wayne's strategic vision and operating
expertise were instrumental in setting INNOVATE on a path toward
future success, and we were fortunate to have him as our CEO,"
Glazer added. "We are confident that Paul Voigt, building on his
prior experience with the Company and each of our three operating
segments, will help INNOVATE capitalize on opportunities to unlock
value and deliver returns for shareholders."
Second Quarter 2023
Highlights
- On May 9, 2023, the Company
consummated the purchase of all of the Series A Fixed-to-Floating
Rate Perpetual Preferred Stock (the “Series A Preferred”) issued by
DBM Global Intermediate Holdco Inc. held by Continental General
Insurance Company (“CGIC”) for $42.2 million, including
$0.4 million of accrued dividends, consisting of
$7.1 million of cash and a $35.1 million unsecured note
that is due in 2026. The purchase was precipitated by a redemption
notice received from CGIC, which notice was permitted to be
delivered by CGIC under the terms of the Series A Preferred.
Infrastructure
- DBM Global Inc. ("DBMG") reported
second quarter 2023 revenue of $362.4 million, a decrease of 5.2%,
compared to $382.1 million in the prior year quarter. Net Income
was $7.0 million, compared to $6.8 million for the prior year
quarter. Adjusted EBITDA increased to $23.5 million from
$20.9 million in the prior year quarter.
- DBM Global grew Adjusted EBITDA
margin to 6.5% in the second quarter, an expansion of approximately
100 basis points year-over-year.
- DBM Global’s reported backlog and
adjusted backlog, which takes into consideration awarded but not
yet signed contracts, was $1.5 billion as of June 30, 2023,
compared to $1.8 billion as of December 31, 2022.
Life Sciences
- R2 Technologies, Inc. ("R2") has now shipped 284 GLACIAL®
devices globally.
- MediBeacon completed the Phase 3 Transdermal GFR Pivotal Study
and filed the Clinical Study Report with FDA.
- MediBeacon submitted the Transdermal GFR Medical Device
Regulation application in Europe.
- MediBeacon research related to Transdermal GFR use in
monitoring acute kidney function changes was published in the peer
reviewed journal of American Society for Artificial Internal
Organs.
- MediBeacon received formal feedback from FDA on future clinical
study plans related to Gastroenterology, Ophthalmology and Surgical
Visualization.
Spectrum
- Broadcasting appointed Matt Katrosar as Chief Executive Officer
in July. Most recently, Mr. Katrosar served as Vice President of
Sales for Paramount Global where he led the company’s streaming and
programmatic sales functions.
- Linear broadcast TV networks are seeing indications of
stabilization in the second quarter and are looking ahead to a
stronger 2024.
- New business opportunities are emerging in other areas,
including religious networks and FAST channels looking for
"over-the-air" distribution.
- For the second quarter of 2023,
Broadcasting reported revenue of $5.7 million, compared to
$9.1 million in the prior year quarter. The decrease was
primarily driven by the elimination of advertising revenues at
Azteca, which ceased operations on December 31, 2022. This was
partially offset by an increase in station revenues, which launched
new markets and networks with its customers in the current
period.
- For the second quarter of 2023,
Broadcasting reported Net Loss of $5.3 million compared to $5.7
million in the prior year quarter. Adjusted EBITDA was
$0.8 million, compared to Adjusted EBITDA of $0.4 million
in the prior year quarter.
Second Quarter 2023 Financial Highlights
- Revenue: For the
second quarter of 2023, INNOVATE's consolidated revenue was $368.8
million, a decrease of 6.0%, compared to $392.2 million for the
prior year quarter. The decrease was primarily driven by our
Infrastructure segment, and, to a lesser extent, our Spectrum
segment. The decline at the Infrastructure segment was driven by
lower revenue at DBMG's industrial maintenance and repair business
and the timing of projects at the commercial structural steel
fabrication business. Revenues at our Spectrum segment decreased
primarily as a result of the termination of HC2 Network, Inc.
("Network") and its associated Azteca America network ("Azteca")
content on December 31, 2022.
|
REVENUE by OPERATING SEGMENT |
|
|
|
|
|
|
|
|
|
|
|
|
|
(in millions) |
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
2023 |
|
2022 |
|
Increase / (Decrease) |
|
2023 |
|
2022 |
|
Increase / (Decrease) |
Infrastructure |
|
$ |
362.4 |
|
$ |
382.1 |
|
$ |
(19.7 |
) |
|
$ |
674.1 |
|
$ |
784.3 |
|
$ |
(110.2 |
) |
Life Sciences |
|
|
0.7 |
|
|
1.0 |
|
|
(0.3 |
) |
|
|
1.2 |
|
|
1.8 |
|
|
(0.6 |
) |
Spectrum |
|
|
5.7 |
|
|
9.1 |
|
|
(3.4 |
) |
|
|
11.4 |
|
|
18.9 |
|
|
(7.5 |
) |
Consolidated INNOVATE |
|
$ |
368.8 |
|
$ |
392.2 |
|
$ |
(23.4 |
) |
|
$ |
686.7 |
|
$ |
805.0 |
|
$ |
(118.3 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- Net Loss: For the
second quarter of 2023, INNOVATE reported a Net Loss attributable
to common stockholders of $10.5 million, or $0.13 per fully
diluted share, compared to a Net Loss of $13.6 million, or
$0.18 per fully diluted share, for the prior year quarter. The
decrease in Net Loss was due to a net increase in gross profit, and
reductions in other operating expenses, depreciation and
amortization and selling, general and administrative expenses
("SG&A"). The increase in gross profit was primarily due to the
increase in our Infrastructure segment due to timing of higher
margin projects at the commercial structural steel fabrication
business, which was partially offset by lower contribution at the
industrial maintenance and repair business. The decrease in Net
Loss was partially offset by an increase in interest expense
attributable to higher interest rates, increased amortization of
debt issuance costs on the debt, and higher outstanding principal
balances.
|
NET INCOME (LOSS) by OPERATING SEGMENT |
|
|
|
|
|
|
|
|
|
|
|
|
|
(in millions) |
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
2023 |
|
2022 |
|
Increase / (Decrease) |
|
2023 |
|
2022 |
|
Increase / (Decrease) |
Infrastructure |
|
$ |
7.0 |
|
|
$ |
6.8 |
|
|
$ |
0.2 |
|
|
$ |
9.0 |
|
|
$ |
12.9 |
|
|
$ |
(3.9 |
) |
Life Sciences |
|
|
(2.9 |
) |
|
|
(5.3 |
) |
|
|
2.4 |
|
|
|
(5.7 |
) |
|
|
(9.4 |
) |
|
|
3.7 |
|
Spectrum |
|
|
(5.3 |
) |
|
|
(5.7 |
) |
|
|
0.4 |
|
|
|
(10.3 |
) |
|
|
(9.1 |
) |
|
|
(1.2 |
) |
Non-operating Corporate |
|
|
(8.2 |
) |
|
|
(9.5 |
) |
|
|
1.3 |
|
|
|
(20.1 |
) |
|
|
(20.8 |
) |
|
|
0.7 |
|
Other and eliminations |
|
|
(0.5 |
) |
|
|
1.3 |
|
|
|
(1.8 |
) |
|
|
8.2 |
|
|
|
1.6 |
|
|
|
6.6 |
|
Net loss attributable to
INNOVATE Corp. |
|
$ |
(9.9 |
) |
|
$ |
(12.4 |
) |
|
|
2.5 |
|
|
$ |
(18.9 |
) |
|
$ |
(24.8 |
) |
|
$ |
5.9 |
|
Less: Preferred dividends |
|
|
0.6 |
|
|
|
1.2 |
|
|
|
(0.6 |
) |
|
|
1.8 |
|
|
|
2.4 |
|
|
|
(0.6 |
) |
Net loss attributable to
common stockholders |
|
$ |
(10.5 |
) |
|
$ |
(13.6 |
) |
|
$ |
3.1 |
|
|
$ |
(20.7 |
) |
|
$ |
(27.2 |
) |
|
$ |
6.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- Adjusted EBITDA:
For the second quarter of 2023, Total Adjusted EBITDA, was $16.5
million, compared to Total Adjusted EBITDA of $12.1 million
for the prior year quarter. The increase in Adjusted EBITDA was
primarily driven by timing of higher margin projects at the
commercial structural steel and fabrication business at our
Infrastructure segment and our Life Science segment primarily due
to Pansend's net carrying amount of its investment in MediBeacon
being zero, which resulted in no additional losses being recognized
in our equity investment in MediBeacon in the current period, and a
decrease in SG&A expenses at R2. Additionally contributing to
the increase in Adjusted EBITDA was the Spectrum segment due to the
elimination of Network's EBITDA losses in the comparable period as
a result the termination of Network. The increase was partially
offset by the Infrastructure segment driven by lower contributions
at the industrial maintenance and repair business and Banker Steel
due to timing and size of projects, as well as an increase in
SG&A. The increase was also partially offset by the elimination
of equity method income from our investment in HMN, which was sold
on March 6, 2023.
|
|
|
|
|
|
|
|
ADJUSTED
EBITDA by OPERATING SEGMENT |
|
|
|
|
|
|
|
|
|
|
|
|
(in millions) |
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
2023 |
|
2022 |
|
Increase / (Decrease) |
|
2023 |
|
2022 |
|
Increase /(Decrease) |
Infrastructure |
$ |
23.5 |
|
|
$ |
20.9 |
|
|
$ |
2.6 |
|
|
$ |
39.8 |
|
|
$ |
41.4 |
|
|
$ |
(1.6 |
) |
Life Sciences |
|
(3.9 |
) |
|
|
(7.5 |
) |
|
|
3.6 |
|
|
|
(11.7 |
) |
|
|
(13.3 |
) |
|
|
1.6 |
|
Spectrum |
|
0.8 |
|
|
|
0.4 |
|
|
|
0.4 |
|
|
|
1.2 |
|
|
|
1.7 |
|
|
|
(0.5 |
) |
Non-operating Corporate |
|
(3.4 |
) |
|
|
(3.4 |
) |
|
|
— |
|
|
|
(6.9 |
) |
|
|
(8.0 |
) |
|
|
1.1 |
|
Other and eliminations |
|
(0.5 |
) |
|
|
1.7 |
|
|
|
(2.2 |
) |
|
|
(1.0 |
) |
|
|
1.8 |
|
|
|
(2.8 |
) |
Total Adjusted EBITDA |
$ |
16.5 |
|
|
$ |
12.1 |
|
|
$ |
4.4 |
|
|
$ |
21.4 |
|
|
$ |
23.6 |
|
|
$ |
(2.2 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- Balance Sheet: As
of June 30, 2023, INNOVATE had cash and cash equivalents,
excluding restricted cash, of $28.8 million compared to $80.4
million as of December 31, 2022. On a stand-alone basis, as of
June 30, 2023, the Non-operating Corporate segment had cash
and cash equivalents of $9.5 million compared to $9.1 million at
December 31, 2022.
Subsequent to the quarter, on July 31, 2023,
INNOVATE drew an additional $7.0 million under the Revolving
Credit Agreement, increasing the outstanding balance to
$20.0 million.
Conference Call
INNOVATE will host a live conference call to
discuss its second quarter 2023 financial results and operations
today at 4:30 p.m. ET. The Company will post an earnings
supplemental presentation in the Investor Relations section of the
INNOVATE website at innovate-ir.com to accompany the
conference call. Dial-in instructions for the conference call and
the replay follows.
- Live Webcast and
Call. A live webcast of the conference
call can be accessed by interested parties through the Investor
Relations section of the INNOVATE website at innovate-ir.com.
- Dial-in: 1-888-886-7786 (Domestic Toll Free) / 1-416-764-8658
(Toll/International)
- Participant Entry Number: 85848080
- Conference
Replay*
- Dial-in: 1-844-512-2921 (Domestic
Toll Free) / 1-412-317-6671 (Toll/International)
- Conference Number: 85848080
*Available approximately two hours after the end of the
conference call through August 23, 2023.
About INNOVATE Corp.
INNOVATE Corp., is a portfolio of best-in-class
assets in three key areas of the new economy – Infrastructure, Life
Sciences and Spectrum. Dedicated to stakeholder capitalism,
INNOVATE employs approximately 3,800 people across its
subsidiaries. For more information, please visit:
www.INNOVATECorp.com.
Contacts
Investor Contact:Anthony
Rozmusir@innovatecorp.com(212) 235-2691
Media Contact:ReevemarkPaul
Caminiti/Pam Greene/Luc HerbowyINNOVATE.Team@reevemark.com(212)
433-4600
Non-GAAP Financial Measures
In this press release, INNOVATE refers to
certain financial measures that are not presented in accordance
with U.S. generally accepted accounting principles (“GAAP”),
including Total Adjusted EBITDA (excluding discontinued operations)
and Adjusted EBITDA for its operating segments.
Adjusted EBITDA
Management believes that Adjusted EBITDA
provides investors with meaningful information for gaining an
understanding of our results as it is frequently used by the
financial community to provide insight into an organization’s
operating trends and facilitates comparisons between peer
companies, since interest, taxes, depreciation, amortization and
the other items listed in the definition of Adjusted EBITDA below
can differ greatly between organizations as a result of differing
capital structures and tax strategies. Adjusted EBITDA can also be
a useful measure of a company’s ability to service debt. While
management believes that non-U.S. GAAP measurements are useful
supplemental information, such adjusted results are not intended to
replace our U.S. GAAP financial results. Using Adjusted EBITDA as a
performance measure has inherent limitations as an analytical tool
as compared to net income (loss) or other U.S. GAAP financial
measures, as this non-GAAP measure excludes certain items,
including items that are recurring in nature, which may be
meaningful to investors. As a result of the exclusions, Adjusted
EBITDA should not be considered in isolation and does not purport
to be an alternative to net income (loss) or other U.S. GAAP
financial measures as a measure of our operating performance.
Adjusted EBITDA excludes the results of operations and any
consolidating eliminations of our previous Insurance segment.
The calculation of Adjusted EBITDA, as defined
by us, consists of Net income (loss) attributable to INNOVATE
Corp., excluding discontinued operations, if applicable;
depreciation and amortization; other operating (income) loss, which
is inclusive of (gain) loss on sale or disposal of assets, lease
termination costs, asset impairment expense and FCC reimbursements;
interest expense; other (income) expense, net; income tax expense
(benefit); non-controlling interest; share-based compensation
expense; restructuring and exit costs; non-recurring items; and
acquisition and disposition costs.
Cautionary Statement Regarding
Forward-Looking Statements
Safe Harbor Statement under the Private
Securities Litigation Reform Act of 1995: This press release
contains, and certain oral statements made by our representatives
from time to time may contain, "forward-looking statements."
Generally, forward-looking statements include information
describing actions, events, results, strategies and expectations
and are generally identifiable by use of the words “believes,”
“expects,” “intends,” “anticipates,” “plans,” “seeks,” “estimates,”
“projects,” “may,” “will,” “could,” “might,” or “continues” or
similar expressions. Such forward-looking statements are based on
current expectations and inherently involve certain risks,
assumptions and uncertainties. The forward-looking statements in
this press release include, without limitation, any statements
regarding INNOVATE’s plans and expectations for future growth and
ability to capitalize on potential opportunities, the achievement
of INNOVATE’s strategic objectives, expectations for performance of
new projects and realization of revenue from the backlog at DBM
Global, anticipated success from the launch of new products in the
Life Sciences segment, anticipated performance of new channels and
LPTV frequencies and expanded uses for LPTV channels in the
Spectrum segment, and changes in macroeconomic and market
conditions and market volatility (including developments and
volatility arising from the COVID-19 pandemic), including interest
rates, the value of securities and other financial assets, and the
impact of such changes and volatility on INNOVATE’s financial
position. Such statements are based on the beliefs and assumptions
of INNOVATE’s management and the management of INNOVATE’s
subsidiaries and portfolio companies.
The Company believes these judgments are
reasonable, but you should understand that these statements are not
guarantees of performance, results or the creation of stockholder
value and the Company’s actual results could differ materially from
those expressed or implied in the forward-looking statements due to
a variety of important factors, both positive and negative,
including those that may be identified in subsequent statements and
reports filed with the Securities and Exchange Commission (“SEC”),
including in our reports on Forms 10-K, 10-Q, and 8-K. Such
important factors include, without limitation: our dependence on
distributions from our subsidiaries to fund our operations and
payments on our obligations; the impact on our business and
financial condition of our substantial indebtedness and the
significant additional indebtedness and other financing obligations
we may incur; our dependence on key personnel; volatility in the
trading price of our common stock; the impact of recent supply
chain disruptions, labor shortages and increases in overall price
levels, including in transportation costs; interest rate
environment; developments relating to the ongoing hostilities in
Ukraine; increased competition in the markets in which our
operating segments conduct their businesses; our ability to
successfully identify any strategic acquisitions or business
opportunities; uncertain global economic conditions in the markets
in which our operating segments conduct their businesses; changes
in regulations and tax laws; covenant noncompliance risk; tax
consequences associated with our acquisition, holding and
disposition of target companies and assets; our ability to remain
in compliance with the listing standards of the New York Stock
Exchange; the ability of our operating segments to attract and
retain customers; our expectations regarding the timing, extent and
effectiveness of our cost reduction initiatives and management’s
ability to moderate or control discretionary spending; our
expectations and timing with respect to any strategic dispositions
and sales of our operating subsidiaries, or businesses; the
possibility of indemnification claims arising out of divestitures
of businesses; and our possible inability to raise additional
capital when needed or refinance our existing debt, on attractive
terms, or at all.
Although INNOVATE believes its expectations and
assumptions regarding its future operating performance are
reasonable, there can be no assurance that the expectations
reflected herein will be achieved. These risks and other important
factors discussed under the caption “Risk Factors” in our most
recent Annual Report on Form 10-K filed with the SEC, and our other
reports filed with the SEC could cause actual results to differ
materially from those indicated by the forward-looking statements
made in this press release.
You should not place undue reliance on
forward-looking statements. All forward-looking statements
attributable to INNOVATE or persons acting on its behalf are
expressly qualified in their entirety by the foregoing cautionary
statements. All such statements speak only as of the date made, and
unless legally required, INNOVATE undertakes no obligation to
update or revise publicly any forward-looking statements, whether
as a result of new information, future events or otherwise.
|
INNOVATE CORP.CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS(in millions, except per share
amounts)(Unaudited) |
|
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
Revenue |
|
$ |
368.8 |
|
|
$ |
392.2 |
|
|
$ |
686.7 |
|
|
$ |
805.0 |
|
Cost of revenue |
|
|
316.2 |
|
|
|
341.9 |
|
|
|
590.5 |
|
|
|
704.9 |
|
Gross
profit |
|
|
52.6 |
|
|
|
50.3 |
|
|
|
96.2 |
|
|
|
100.1 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
Selling, general and administrative |
|
|
41.1 |
|
|
|
42.1 |
|
|
|
82.8 |
|
|
|
84.7 |
|
Depreciation and amortization |
|
|
5.6 |
|
|
|
6.9 |
|
|
|
11.9 |
|
|
|
13.8 |
|
Other operating loss (income) |
|
|
0.1 |
|
|
|
1.7 |
|
|
|
(0.3 |
) |
|
|
1.3 |
|
Income (loss) from
operations |
|
|
5.8 |
|
|
|
(0.4 |
) |
|
|
1.8 |
|
|
|
0.3 |
|
Other (expense) income: |
|
|
|
|
|
|
|
|
Interest expense |
|
|
(16.3 |
) |
|
|
(12.5 |
) |
|
|
(31.9 |
) |
|
|
(25.1 |
) |
Loss from equity investees |
|
|
(0.3 |
) |
|
|
(0.5 |
) |
|
|
(4.3 |
) |
|
|
(1.0 |
) |
Other income, net |
|
|
0.3 |
|
|
|
1.5 |
|
|
|
16.8 |
|
|
|
1.4 |
|
Loss from operations
before income taxes |
|
|
(10.5 |
) |
|
|
(11.9 |
) |
|
|
(17.6 |
) |
|
|
(24.4 |
) |
Income tax expense |
|
|
(1.2 |
) |
|
|
(2.0 |
) |
|
|
(2.1 |
) |
|
|
(3.6 |
) |
Net loss |
|
|
(11.7 |
) |
|
|
(13.9 |
) |
|
|
(19.7 |
) |
|
|
(28.0 |
) |
Net loss attributable to non-controlling interests and redeemable
non-controlling interests |
|
|
1.8 |
|
|
|
1.5 |
|
|
|
0.8 |
|
|
|
3.2 |
|
Net loss attributable
to INNOVATE Corp. |
|
|
(9.9 |
) |
|
|
(12.4 |
) |
|
|
(18.9 |
) |
|
|
(24.8 |
) |
Less: Preferred dividends |
|
|
0.6 |
|
|
|
1.2 |
|
|
|
1.8 |
|
|
|
2.4 |
|
Net loss attributable
to common stockholders |
|
$ |
(10.5 |
) |
|
$ |
(13.6 |
) |
|
$ |
(20.7 |
) |
|
$ |
(27.2 |
) |
|
|
|
|
|
|
|
|
|
Loss per share - basic and
diluted |
|
$ |
(0.13 |
) |
|
$ |
(0.18 |
) |
|
$ |
(0.27 |
) |
|
$ |
(0.35 |
) |
|
|
|
|
|
|
|
|
|
Weighted average common shares
outstanding - basic and diluted |
|
|
77.9 |
|
|
|
77.5 |
|
|
|
77.8 |
|
|
|
77.4 |
|
|
INNOVATE CORP.CONDENSED CONSOLIDATED BALANCE SHEET(in
millions, except share amounts)(Unaudited) |
|
|
|
June 30,2023 |
|
|
December 31,2022 |
|
Assets |
|
|
|
|
Current assets |
|
|
|
|
Cash and cash equivalents |
|
$ |
28.8 |
|
|
$ |
80.4 |
|
Accounts receivable, net |
|
|
293.6 |
|
|
|
254.9 |
|
Contract assets |
|
|
175.3 |
|
|
|
165.1 |
|
Inventory |
|
|
19.9 |
|
|
|
18.9 |
|
Restricted cash |
|
|
— |
|
|
|
0.3 |
|
Other current assets |
|
|
13.6 |
|
|
|
16.8 |
|
Total current assets |
|
|
531.2 |
|
|
|
536.4 |
|
Investments |
|
|
7.4 |
|
|
|
59.5 |
|
Deferred tax asset |
|
|
1.7 |
|
|
|
1.7 |
|
Property, plant and equipment, net |
|
|
161.5 |
|
|
|
165.0 |
|
Goodwill |
|
|
127.0 |
|
|
|
127.1 |
|
Intangibles, net |
|
|
182.6 |
|
|
|
190.1 |
|
Other assets |
|
|
68.1 |
|
|
|
71.9 |
|
Total
assets |
|
$ |
1,079.5 |
|
|
$ |
1,151.7 |
|
Liabilities, temporary
equity and stockholders’ deficit |
|
|
|
|
Current liabilities |
|
|
|
|
Accounts payable |
|
$ |
188.7 |
|
|
$ |
202.5 |
|
Accrued liabilities |
|
|
73.3 |
|
|
|
65.4 |
|
Current portion of debt obligations |
|
|
222.4 |
|
|
|
30.6 |
|
Contract liabilities |
|
|
117.3 |
|
|
|
98.6 |
|
Other current liabilities |
|
|
17.2 |
|
|
|
20.1 |
|
Total current liabilities |
|
|
618.9 |
|
|
|
417.2 |
|
Deferred tax liability |
|
|
3.8 |
|
|
|
9.1 |
|
Debt obligations |
|
|
519.6 |
|
|
|
683.8 |
|
Other liabilities |
|
|
55.2 |
|
|
|
71.2 |
|
Total
liabilities |
|
|
1,197.5 |
|
|
|
1,181.3 |
|
Commitments and
contingencies |
|
|
|
|
Temporary
equity |
|
|
|
|
Preferred stock Series A-3 and Series A-4, $0.001 par value |
|
|
17.0 |
|
|
|
17.6 |
|
Shares authorized: 20,000,000 as of both June 30, 2023 and
December 31, 2022 |
|
|
|
|
Shares issued and outstanding: 6,125 of Series A-3 and 10,000 of
Series A-4 as of both June 30, 2023 and December 31, 2022 |
|
|
|
|
Redeemable non-controlling interest |
|
|
(6.9 |
) |
|
|
43.4 |
|
Total temporary
equity |
|
|
10.1 |
|
|
|
61.0 |
|
Stockholders’
deficit |
|
|
|
|
Common stock, $0.001 par value |
|
|
0.1 |
|
|
|
0.1 |
|
Shares authorized: 160,000,000 as of both June 30, 2023 and
December 31, 2022 |
|
|
|
|
Shares issued: 80,722,983 and 80,216,028 as of June 30, 2023
and December 31, 2022, respectively |
|
|
|
|
Shares outstanding: 79,234,991 and 78,787,768 as of June 30,
2023 and December 31, 2022, respectively |
|
|
|
|
Additional paid-in capital |
|
|
327.0 |
|
|
|
330.1 |
|
Treasury stock, at cost: 1,487,992 and 1,428,260 shares as of
June 30, 2023 and December 31, 2022, respectively |
|
|
(5.4 |
) |
|
|
(5.3 |
) |
Accumulated deficit |
|
|
(471.0 |
) |
|
|
(452.1 |
) |
Accumulated other comprehensive (loss) income |
|
|
(1.6 |
) |
|
|
5.9 |
|
Total INNOVATE Corp.
stockholders’ deficit |
|
|
(150.9 |
) |
|
|
(121.3 |
) |
Non-controlling interest |
|
|
22.8 |
|
|
|
30.7 |
|
Total stockholders’
deficit |
|
|
(128.1 |
) |
|
|
(90.6 |
) |
Total liabilities,
temporary equity and stockholders’ deficit |
|
$ |
1,079.5 |
|
|
$ |
1,151.7 |
|
|
INNOVATE CORP.RECONCILIATION OF NET INCOME
(LOSS) TO ADJUSTED EBITDA(Unaudited) |
|
(in millions) |
|
Three Months Ended June 30, 2023 |
|
|
Infrastructure |
|
Life Sciences |
|
Spectrum |
|
Non-operating Corporate |
|
Other and Eliminations |
|
INNOVATE |
Net income (loss) attributable to INNOVATE Corp. |
|
$ |
7.0 |
|
|
$ |
(2.9 |
) |
|
$ |
(5.3 |
) |
|
$ |
(8.2 |
) |
|
$ |
(0.5 |
) |
|
$ |
(9.9 |
) |
Adjustments to reconcile net
income (loss) to Adjusted EBITDA: |
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
4.1 |
|
|
|
0.1 |
|
|
|
1.3 |
|
|
|
0.1 |
|
|
|
— |
|
|
|
5.6 |
|
Depreciation and amortization (included in cost of revenue) |
|
|
4.0 |
|
|
|
0.1 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
4.1 |
|
Other operating loss |
|
|
0.1 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
0.1 |
|
Interest expense |
|
|
3.4 |
|
|
|
0.7 |
|
|
|
3.4 |
|
|
|
8.8 |
|
|
|
— |
|
|
|
16.3 |
|
Other (income) expense, net |
|
|
(0.3 |
) |
|
|
(0.1 |
) |
|
|
1.9 |
|
|
|
(1.9 |
) |
|
|
0.1 |
|
|
|
(0.3 |
) |
Income tax expense (benefit) |
|
|
3.8 |
|
|
|
— |
|
|
|
— |
|
|
|
(2.6 |
) |
|
|
— |
|
|
|
1.2 |
|
Non-controlling interest |
|
|
0.7 |
|
|
|
(1.9 |
) |
|
|
(0.6 |
) |
|
|
— |
|
|
|
— |
|
|
|
(1.8 |
) |
Share-based compensation expense |
|
|
— |
|
|
|
0.1 |
|
|
|
— |
|
|
|
0.6 |
|
|
|
— |
|
|
|
0.7 |
|
Restructuring and exit costs |
|
|
0.5 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
0.5 |
|
Acquisition and disposition costs |
|
|
0.2 |
|
|
|
— |
|
|
|
0.1 |
|
|
|
(0.2 |
) |
|
|
(0.1 |
) |
|
|
— |
|
Adjusted EBITDA |
|
$ |
23.5 |
|
|
$ |
(3.9 |
) |
|
$ |
0.8 |
|
|
$ |
(3.4 |
) |
|
$ |
(0.5 |
) |
|
$ |
16.5 |
|
(in millions) |
|
Three Months Ended June 30, 2022 |
|
|
Infrastructure |
|
Life Sciences |
|
Spectrum |
|
Non-operating Corporate |
|
Other and Eliminations |
|
INNOVATE |
Net income (loss) attributable to INNOVATE Corp. |
|
$ |
6.8 |
|
|
$ |
(5.3 |
) |
|
$ |
(5.7 |
) |
|
$ |
(9.5 |
) |
|
$ |
1.3 |
|
$ |
(12.4 |
) |
Adjustments to reconcile net
income (loss) to Adjusted EBITDA: |
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
5.3 |
|
|
|
— |
|
|
|
1.5 |
|
|
|
0.1 |
|
|
|
— |
|
|
6.9 |
|
Depreciation and amortization (included in cost of revenue) |
|
|
3.6 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
3.6 |
|
Other operating loss |
|
|
— |
|
|
|
— |
|
|
|
1.7 |
|
|
|
— |
|
|
|
— |
|
|
1.7 |
|
Interest expense |
|
|
2.2 |
|
|
|
— |
|
|
|
1.9 |
|
|
|
8.4 |
|
|
|
— |
|
|
12.5 |
|
Other (income) expense, net |
|
|
(1.4 |
) |
|
|
(0.2 |
) |
|
|
1.4 |
|
|
|
(1.2 |
) |
|
|
— |
|
|
(1.4 |
) |
Gain on sale or dissolution of subsidiary |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(0.1 |
) |
|
|
— |
|
|
(0.1 |
) |
Income tax expense (benefit) |
|
|
3.5 |
|
|
|
— |
|
|
|
— |
|
|
|
(1.5 |
) |
|
|
— |
|
|
2.0 |
|
Non-controlling interest |
|
|
0.7 |
|
|
|
(2.1 |
) |
|
|
(0.5 |
) |
|
|
— |
|
|
|
0.4 |
|
|
(1.5 |
) |
Share-based compensation expense |
|
|
— |
|
|
|
0.1 |
|
|
|
— |
|
|
|
0.4 |
|
|
|
— |
|
|
0.5 |
|
Non-recurring items |
|
|
0.1 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
0.1 |
|
Acquisition and disposition costs |
|
|
0.1 |
|
|
|
— |
|
|
|
0.1 |
|
|
|
— |
|
|
|
— |
|
|
0.2 |
|
Adjusted EBITDA |
|
$ |
20.9 |
|
|
$ |
(7.5 |
) |
|
$ |
0.4 |
|
|
$ |
(3.4 |
) |
|
$ |
1.7 |
|
$ |
12.1 |
|
|
INNOVATE CORP.RECONCILIATION OF NET INCOME
(LOSS) TO ADJUSTED EBITDA(Unaudited) |
|
(in millions) |
|
Six Months Ended June 30, 2023 |
|
|
Infrastructure |
|
Life Sciences |
|
Spectrum |
|
Non-operating Corporate |
|
Other and Eliminations |
|
INNOVATE |
Net income (loss) attributable to INNOVATE Corp. |
|
$ |
9.0 |
|
|
$ |
(5.7 |
) |
|
$ |
(10.3 |
) |
|
$ |
(20.1 |
) |
|
$ |
8.2 |
|
|
$ |
(18.9 |
) |
Adjustments to reconcile net
income (loss) to Adjusted EBITDA: |
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
9.0 |
|
|
|
0.2 |
|
|
|
2.6 |
|
|
|
0.1 |
|
|
|
— |
|
|
|
11.9 |
|
Depreciation and amortization (included in cost of revenue) |
|
|
7.9 |
|
|
|
0.1 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
8.0 |
|
Other operating income |
|
|
— |
|
|
|
— |
|
|
|
(0.3 |
) |
|
|
— |
|
|
|
— |
|
|
|
(0.3 |
) |
Interest expense |
|
|
6.8 |
|
|
|
1.2 |
|
|
|
6.6 |
|
|
|
17.3 |
|
|
|
— |
|
|
|
31.9 |
|
Other (income) expense, net |
|
|
(0.5 |
) |
|
|
(4.0 |
) |
|
|
3.7 |
|
|
|
(3.5 |
) |
|
|
(12.5 |
) |
|
|
(16.8 |
) |
Income tax expense (benefit) |
|
|
4.9 |
|
|
|
— |
|
|
|
— |
|
|
|
(1.6 |
) |
|
|
(1.2 |
) |
|
|
2.1 |
|
Non-controlling interest |
|
|
0.9 |
|
|
|
(3.8 |
) |
|
|
(1.2 |
) |
|
|
— |
|
|
|
3.3 |
|
|
|
(0.8 |
) |
Share-based compensation expense |
|
|
— |
|
|
|
0.3 |
|
|
|
— |
|
|
|
0.9 |
|
|
|
— |
|
|
|
1.2 |
|
Restructuring and exit costs |
|
|
1.0 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1.0 |
|
Acquisition and disposition costs |
|
|
0.8 |
|
|
|
— |
|
|
|
0.1 |
|
|
|
— |
|
|
|
1.2 |
|
|
|
2.1 |
|
Adjusted EBITDA |
|
$ |
39.8 |
|
|
$ |
(11.7 |
) |
|
$ |
1.2 |
|
|
$ |
(6.9 |
) |
|
$ |
(1.0 |
) |
|
$ |
21.4 |
|
(in millions) |
|
Six Months Ended June 30, 2022 |
|
|
Infrastructure |
|
Life Sciences |
|
Spectrum |
|
Non-operating Corporate |
|
Other and Eliminations |
|
INNOVATE |
Net income (loss) attributable to INNOVATE Corp. |
|
$ |
12.9 |
|
|
$ |
(9.4 |
) |
|
$ |
(9.1 |
) |
|
$ |
(20.8 |
) |
|
$ |
1.6 |
|
|
$ |
(24.8 |
) |
Adjustments to reconcile net
income (loss) to Adjusted EBITDA: |
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
10.6 |
|
|
|
0.1 |
|
|
|
3.0 |
|
|
|
0.1 |
|
|
|
— |
|
|
|
13.8 |
|
Depreciation and amortization (included in cost of revenue) |
|
|
7.3 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
7.3 |
|
Other operating (income) loss |
|
|
(0.6 |
) |
|
|
— |
|
|
|
1.9 |
|
|
|
— |
|
|
|
— |
|
|
|
1.3 |
|
Interest expense |
|
|
4.4 |
|
|
|
— |
|
|
|
3.9 |
|
|
|
16.8 |
|
|
|
— |
|
|
|
25.1 |
|
Other (income) expense, net |
|
|
(1.3 |
) |
|
|
(0.1 |
) |
|
|
2.9 |
|
|
|
(2.8 |
) |
|
|
— |
|
|
|
(1.3 |
) |
Gain on sale or dissolution of subsidiary |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(0.1 |
) |
|
|
— |
|
|
|
(0.1 |
) |
Income tax expense (benefit) |
|
|
6.4 |
|
|
|
— |
|
|
|
— |
|
|
|
(2.8 |
) |
|
|
— |
|
|
|
3.6 |
|
Non-controlling interest |
|
|
1.3 |
|
|
|
(4.1 |
) |
|
|
(1.1 |
) |
|
|
— |
|
|
|
0.7 |
|
|
|
(3.2 |
) |
Share-based compensation expense |
|
|
— |
|
|
|
0.2 |
|
|
|
— |
|
|
|
1.1 |
|
|
|
— |
|
|
|
1.3 |
|
Non-recurring items |
|
|
0.1 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
0.1 |
|
Acquisition and disposition costs |
|
|
0.3 |
|
|
|
— |
|
|
|
0.2 |
|
|
|
0.5 |
|
|
|
(0.5 |
) |
|
|
0.5 |
|
Adjusted EBITDA |
|
$ |
41.4 |
|
|
$ |
(13.3 |
) |
|
$ |
1.7 |
|
|
$ |
(8.0 |
) |
|
$ |
1.8 |
|
|
$ |
23.6 |
|
INNOVATE (NYSE:VATE)
Historical Stock Chart
From Jul 2024 to Aug 2024
INNOVATE (NYSE:VATE)
Historical Stock Chart
From Aug 2023 to Aug 2024