Creative Professional Revenue Exceeds $100
Million, Representing 50% of Annual Revenue
2017 Guidance Consistent with High-Level
Outlook
Monotype Imaging Holdings Inc. (Nasdaq: TYPE), a leader in
helping to empower expression and engagement through type,
technology and expertise, today announced financial results for the
fourth quarter and full year ended December 31, 2016.
Fourth quarter 2016 highlights
- Revenue for the quarter was $52.6
million, an increase of 4%, year over year. Pro Forma non-GAAP
revenue for the quarter was $55.1 million.
- Creative Professional revenue was $27.2
million, up 11%, year over year.
- Net income was $0.5 million. Non-GAAP
net adjusted EBITDA was $10.6 million, or 20% of revenue. Pro Forma
non-GAAP net adjusted EBITDA was $13.1 million, or 24% of Pro Forma
non-GAAP revenue. Both non-GAAP and Pro Forma non-GAAP net adjusted
EBITDA include $2.2 million of non-recurring costs, primarily
related to restructuring activities.
Full year 2016 highlights
- Revenue for the year was $203.4
million, an increase of 6%, year over year. Pro Forma non-GAAP
revenue for the year was $215.9 million.
- Creative Professional revenue was
$102.4 million, up 16%, year over year.
- Net income was $14.9 million. Non-GAAP
net adjusted EBITDA was $59.8 million, or 29% of revenue. Pro Forma
non-GAAP net adjusted EBITDA was $52.7 million, or 24% of Pro Forma
non-GAAP revenue.
- Cash and cash equivalents were $91.4
million at December 31, 2016.
“Continued strong performance in our Creative Professional
business helped push full year results over the $200 million mark
for the first time in our history,” said Scott Landers, president
and chief executive officer of Monotype. “2016 was a
transformational year for Monotype, where we saw the emergence of
new digital use cases, such as HTML5-based digital advertising, as
well as significantly expanded opportunities in new markets with
the acquisition of Olapic. We believe there is a substantial
opportunity ahead for Monotype to provide comprehensive value to
brands, and we are well positioned to take advantage of it.”
Tony Callini, chief financial officer of Monotype, said, “I’m
pleased to join Monotype during such an exciting period in the
company’s history. Our recent acquisitions and execution on
expanded growing product offerings helped fuel double-digit
year-over-year growth in Creative Professional for the 14th quarter
in a row. And even as we invest for long-term growth, we’re keenly
focused on execution and profitability. Further, during this
investment cycle, we are still committed to returning value to our
shareholders as evidenced by the fifth annual increase to our
dividend.”
Fourth quarter 2016 operating resultsRevenue for the
quarter increased 4% to $52.6 million, compared to $50.6 million
for the fourth quarter of 2015. Fourth quarter revenue was reduced
by a $2.5 million purchase accounting adjustment related to Olapic
deferred revenue. Creative Professional revenue was $27.2 million,
a 11% increase from the fourth quarter of 2015. OEM revenue was
$25.4 million, a decrease of 3% from the same period in 2015.
Net income was $0.5 million, compared to $4.9 million in the
fourth quarter of 2015. Earnings per diluted share were $0.01,
compared to $0.12 in the prior year quarter. The company’s
effective tax rate in the quarter of 59% was impacted by $1.6
million of acquisition-related compensation expense, which is not
deductible for income tax purposes.
Non-GAAP net income, which excludes the amortization of
intangible assets, stock-based compensation expense and
acquisition-related compensation expense, net of taxes, was $4.8
million, compared to $12.0 million in the fourth quarter of 2015.
Non-GAAP earnings per diluted share were $0.12 compared to $0.30 in
the prior year period.
Non-GAAP net adjusted EBITDA was $10.6 million, or 20% of
revenue, compared to $20.7 million in the fourth quarter of 2015.
Non-GAAP net adjusted EBITDA includes $2.2 million of non-recurring
costs, primarily related to restructuring activities.
Full year 2016 operating resultsRevenue for the year was
$203.4 million, an increase of 6% compared to $192.4 million for
2015. 2016 GAAP revenue was reduced by a $3.2 million purchase
accounting adjustment related to Olapic deferred revenue. Creative
Professional revenue was $102.4 million, an increase of 16% year
over year. OEM revenue was $101.0 million, down 3% year over
year.
Net income for 2016 was $14.9 million, compared to net income of
$26.2 million for the prior year. Earnings per diluted share were
$0.36, compared to earnings per diluted share of $0.65 in 2015. The
company’s 2016 effective tax rate of 41% was impacted by $3.9
million of acquisition-related compensation expense, which is not
deductible for income tax purposes.
Non-GAAP net income, which excludes the amortization of
intangible assets, stock-based compensation expense, and
acquisition-related compensation expense, net of taxes, was $33.7
million, compared to $44.1 million in 2015. Non-GAAP earnings per
diluted share were $0.85, compared to $1.12 in 2015.
Non-GAAP net adjusted EBITDA was $59.8 million, or 29% of
revenue, compared to non-GAAP net adjusted EBITDA of $71.0 million
in 2015. Included in non-GAAP net adjusted EBITDA are the
aforementioned $2.2 million of non-recurring costs.
A reconciliation of GAAP measures to non-GAAP measures for the
three and 12 months ended December 31, 2016 and 2015 is provided in
the financial tables that accompany this release.
Pro Forma operating resultsPro Forma results assume the
company had owned Olapic for the full periods presented, and
exclude the impact of purchase accounting related adjustments, as
well as transaction costs.
Pro Forma non-GAAP revenue in the fourth quarter was $55.1
million and Pro Forma non-GAAP net adjusted EBITDA was $13.1
million. Pro Forma non-GAAP net adjusted EBITDA includes $2.2
million of non-recurring costs, primarily related to restructuring
activities.
Pro Forma non-GAAP revenue for the full year was $215.9 million
and Pro Forma non-GAAP net adjusted EBITDA was $52.7 million, which
again includes $2.2 million of non-recurring costs.
Cash and cash flowMonotype had cash and cash equivalents
of $91.4 million as of December 31, 2016, compared to $97.6 million
as of September 30, 2016 and $87.5 million as of December 31, 2015.
The company generated $8.8 million of cash from operations in the
fourth quarter of 2016 and $40.7 million for the full year 2016.
During the fourth quarter of 2016, the company repaid $5.0 million
on its outstanding revolving line of credit.
In the fourth quarter and the full year, Monotype repurchased
287,250 shares of common stock on the open market at prevailing
market prices for a total consideration of $5.6 million as part of
the stock repurchase program announced in August 2016.
Quarterly dividendMonotype’s most recent dividend payment
of $0.11 per share was paid on January 20, 2017, to shareholders of
record as of January 2, 2017. The Board has approved a 3% increase
to the company’s quarterly dividend payment. As a result, a
dividend of $0.113 cents per share will be paid on April 21, 2017,
to shareholders of record as of the close of business on April 3,
2017. The total dividend payments for 2016 were $17.5 million.
Financial outlookMonotype’s first quarter and full year
financial guidance are set forth in the following tables:
(in $
millions) Q1 2017 Full Year 2017 Revenue $51.5-$55.5 $229.0-$237.0
Non-GAAP net adjusted EBITDA
$8.5-$11.5
$47.5-$54.1
Operating expenses
$41.5-$44.5 $178.0-$182.0 GAAP earnings per diluted share
$(0.03)-$0.01
$0.04-$0.12
Non-GAAP earnings per diluted share
$0.09-$0.13
$0.54-$0.62
Q1 2017 Full Year 2017
Pro Forma revenue
$52.9-$56.9 $232.3-$240.3
Pro Forma non-GAAP net adjusted EBITDA
$9.9-$12.9
$50.8-$57.4
Conference call detailsMonotype will host a conference
call on Friday, Feb. 17, 2016, at 8:30 a.m. EST to discuss the
company’s fourth quarter and full year 2016 results and business
outlook for 2017. Individuals who are interested in listening to
the audio webcast should log on to the Investors portion of the
Company section of the Monotype website at www.monotype.com. The
live call can also be accessed by dialing 844-229-7594 (domestic)
or 314-888-4259 (international) using passcode 66064087. If
individuals are unable to listen to the live call, the audio
webcast will be archived in the Investors portion of the company’s
website for one year.
Non-GAAP financial measuresThis press release contains
non-GAAP financial measures under the rules of the U.S. Securities
and Exchange Commission. This non-GAAP information supplements and
is not intended to represent a measure of performance in accordance
with disclosures required by generally accepted accounting
principles. Non-GAAP financial measures are used internally to
manage the business, such as in establishing an annual operating
budget and in reporting to lenders. Non-GAAP financial measures are
used by Monotype management in its operating and financial
decision-making because management believes these measures reflect
ongoing business in a manner that allows meaningful
period-to-period comparisons. Accordingly, Monotype believes it is
useful for investors and others to review both GAAP and non-GAAP
measures in order to (a) understand and evaluate current operating
performance and future prospects in the same manner as management
does and (b) compare in a consistent manner the company’s current
financial results with past financial results. The primary
limitations associated with the use of non-GAAP financial measures
are that these measures may not be directly comparable to the
amounts reported by other companies and they do not include all
items of income and expense that affect operations. Monotype
management compensates for these limitations by considering the
company’s financial results and outlook as determined in accordance
with GAAP and by providing a detailed reconciliation of the
non-GAAP financial measures to the most directly comparable GAAP
measures in the tables attached to this press release.
Forward-looking statementsThis press release may contain
forward-looking statements including those related to future
revenues and operating results, the financial impact of the Olapic
acquisition, the growth of the company’s Creative Professional
business and OEM business, the execution of the company’s product,
growth and expansion strategies and anticipated business momentum
that involve risks and uncertainties that could cause the company’s
actual results to differ materially. Factors that might cause or
contribute to such differences include, but are not limited to:
risks associated with changes in the economic climate including
decreased demand for the company’s products or products that
incorporate the company’s solutions; risks associated with the
company’s ability to adapt its products or services to new markets
and to anticipate and quickly respond to evolving technologies and
customer requirements; risks associated with the company’s
development of and the market acceptance of new products, product
features or services; risks associated with the company’s
integration of the Olapic acquisition; risks associated with the
company’s ability to expand products and services offered through
acquired companies; risks associated with increased competition in
markets the company serves, including the risks that increased
competition may result in the company’s inability to gain new
customers, retain existing customers or may force the company to
reduce prices; risks associated with the ownership and enforcement
of the company’s intellectual property; and risks associated with
geopolitical conditions and changes in the financial markets.
Additional disclosure regarding these and other risks faced by the
company is available in the company’s public filings with the
Securities and Exchange Commission, including the risk factors
included in the company’s Annual Report on Form 10-K for the year
ended December 31, 2015 and subsequent filings. The forward-looking
financial information set forth in this press release reflects
estimates based on information available at this time. These
amounts could differ from actual reported amounts to be included in
the company’s future earnings releases and public filings. While
the company may elect to update forward-looking statements at some
point in the future, the company specifically disclaims any
obligation to do so, even if an estimate changes.
About MonotypeMonotype is a leader in empowering
expression and engagement through a combination of type, technology
and expertise. Headquartered in Woburn, Mass., Monotype provides
customers worldwide with typeface solutions for a broad range of
creative applications and consumer devices. The company’s libraries
and e-commerce sites are home to many of the most widely used
typefaces – including the Helvetica®, Frutiger® and Univers®
families – as well as the next generation of type designs. Further
information is available at www.monotype.com. Follow Monotype on
Twitter, Instagram and LinkedIn.
Monotype, Helvetica and Frutiger are trademarks of Monotype
Imaging Inc. registered in the U.S. Patent and Trademark
Office and may be registered in certain
jurisdictions. Univers is a trademark of Monotype
GmbH registered in the U.S. Patent and Trademark Office and may be
registered in certain jurisdictions. All other trademarks are the
property of their respective owners. ©2017 Monotype Imaging
Holdings Inc. All rights reserved.
MONOTYPE IMAGING HOLDINGS INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(Unaudited and in thousands)
December 31,2016 December
31,2015 Assets Current assets: Cash and cash
equivalents $ 91,434 $ 87,520 Accounts receivable, net of allowance
for doubtful accounts 26,549 15,179 Income tax refunds receivable
2,967 2,558 Prepaid expense and other current assets 4,631
3,846 Total current assets 125,581
109,103 Property and equipment, net 14,166 15,204 Goodwill 273,489
185,735 Intangible assets, net 90,717 69,264 Restricted cash 17,992
9,304 Other assets 3,075 3,177
Total assets $ 525,020 $ 391,787
Liabilities and Stockholders’ Equity Current liabilities:
Accounts payable $ 2,170 $ 1,385 Accrued expenses and other current
liabilities 28,762 21,422 Accrued income taxes payable 1,473 2,395
Deferred revenue 16,081 10,086
Total current liabilities 48,486 35,288 Revolving line of credit
105,000 — Other long-term liabilities 11,752 6,914 Deferred income
taxes 37,780 35,159 Reserve for income taxes, net of current
portion 2,727 2,316 Accrued pension benefits 5,297 4,928
Stockholders’ equity: Common stock 43 42 Additional paid-in capital
274,946 256,215 Treasury stock, at cost (56,232 ) (50,455 )
Retained earnings 105,718 108,908 Accumulated other comprehensive
loss (10,497 ) (7,528 ) Total stockholders’
equity 313,978 307,182 Total
liabilities and stockholders’ equity $ 525,020 $ 391,787
MONOTYPE IMAGING HOLDINGS INC.
CONDENSED CONSOLIDATED STATEMENTS OF
INCOME
(Unaudited and in thousands, except
share and per share data)
Three Months EndedDecember 31, Year
EndedDecember 31,
2016
2015 2016 2015 Revenue $ 52,637 $ 50,616 $
203,441 $ 192,419 Costs and expenses: Cost of revenue 8,463 7,967
32,904 30,281 Cost of revenue—amortization of acquired technology
1,083 1,133 4,672 4,448
Total cost of revenue 9,546 9,100
37,576 34,729 Gross profit 43,091
41,516 165,865 157,690 Operating expenses: Marketing and selling
19,298 14,317 64,571 57,297 Research and development 7,807 5,233
28,915 21,477 General and administrative 13,755 11,263 42,595
33,343 Amortization of other intangible assets 975
775 3,393 3,129 Total operating
expenses 41,835 31,588 139,474
115,246 Income from operations 1,256 9,928 26,391
42,444 Other (income) expense: Interest expense, net 678 144 1,227
919 Loss on extinguishment of debt — — — 112 Other (income)
expense, net (514 ) 326 (35 ) 938
Total other expense 164 470
1,192 1,969 Income before provision for income
taxes 1,092 9,458 25,199 40,475 Provision for income taxes
642 4,561 10,313 14,278
Net income $ 450 $ 4,897 $ 14,886 $ 26,197 Net
income available to common shareholders—basic $ 455 $ 4,779
$ 14,395 $ 25,575 Net income available to common
shareholders—diluted $ 450 $ 4,780 $ 14,394 $ 25,579
Net income per common share: Basic $ 0.01 $ 0.12 $
0.37 $ 0.66 Diluted $ 0.01 $ 0.12 $ 0.36
$ 0.65 Weighted average number of shares: Basic
39,576,243 38,934,008 39,405,700 38,840,094 Diluted 40,059,101
39,381,559 39,731,923 39,382,566 Dividends declared per common
share $ 0.11 $ 0.10 $ 0.44 $ 0.40
MONOTYPE IMAGING HOLDINGS INC.
OTHER INFORMATION
(Unaudited and in thousands)
RECONCILIATION OF GAAP REVENUE TO PRO
FORMA NON-GAAP REVENUE
Three Months EndedDecember 31, 2016
Monotype Olapic
Combined GAAP revenue $ 50,245 $ 2,392
$ 52,637 Pre-acquisition revenue (1) — — — Deferred revenue
impairment — 2,456
2,456 Pro Forma non-GAAP revenue $ 50,245 $
4,848 $ 55,093
(1) Pro Forma non-GAAP revenue has no pre-acquisition revenue
adjustments in the three months ended December 31, 2016. We
acquired Olapic on August 9, 2016.
Year Ended December 31,
2016
Monotype Olapic
Combined GAAP revenue $ 199,086
$ 4,355 $ 203,441
Pre-acquisition revenue(1) — 9,344 9,344 Deferred revenue
impairment — 3,159
3,159 Pro Forma non-GAAP revenue
$ 199,086 $ 16,858
$ 215,944
(1) Pro Forma non-GAAP revenue includes $0, $9.3 million and
$9.3 million, respectively, of Olapic revenue recognized during the
period of January 1, 2016 to August 8, 2016. We acquired Olapic on
August 9, 2016.
RECONCILIATION OF GAAP NET INCOME TO
NON-GAAP NET ADJUSTED EBITDA
Three Months EndedDecember 31, Year
EndedDecember 31,
2016(1)
2015(2)
2016(1)
2015(2)
GAAP net income $ 450 $ 4,897 $ 14,886 $ 26,197 Interest expense,
net 678 144 1,227 919 Loss on extinguishment of debt — — — 112
Other (income) expense, net (514 ) 326 (35 ) 938 Provision for
income taxes 642 4,561 10,313
14,278 Income from operations 1,256
9,928 26,391 42,444 Depreciation and amortization 3,165 2,913
12,279 10,819 Share based compensation 4,566 3,742 17,271 13,583
Acquisition-related compensation
1,636 4,164 3,869
4,164
Net adjusted EBITDA
$ 10,623 $ 20,747 $ 59,810 $ 71,010
(1) For the three months and year ended December 31, 2016,
the amount includes $0.7 million and $2.5 million, respectively, of
expense associated with the deferred compensation arrangements
resulting from an amendment to the Swyft Merger Agreement and $0.9
million and $1.4 million, respectively, of expense associated with
the deferred compensation arrangements with the founders of Olapic
in connection with the acquisition.
(2) For the three months and year ended December 31, 2015,
the amount includes $4.2 million and $4.2 million, respectively, of
expense associated with the deferred compensation arrangements
resulting from an amendment to the Swyft Merger Agreement.
MONOTYPE IMAGING HOLDINGS INC.
OTHER INFORMATION
(Unaudited and in thousands, except
share and per share amounts)
RECONCILIATION OF GAAP NET INCOME TO
NON-GAAP NET INCOME
Three Months EndedDecember 31, Year
EndedDecember 31,
2016(1)
2015(2)
2016(1)
2015(2)
GAAP net income available to common stockholders ─ diluted $ 450 $
4,897 $ 14,886 $ 26,197 Amortization, net of tax of $1,210, $920,
$3,299 and $2,675, respectively 848 988 4,766 4,902 Share based
compensation, net of tax of $2,685, $1,804, $7,064 and $4,795,
respectively 1,881 1,938 10,207 8,788
Acquisition-related compensation, net of
tax of $0, $0, $0 and $0, respectively
1,636 4,164 3,869
4,164
Non-GAAP net income
$ 4,815 $ 11,987 $ 33,728 $ 44,051
(1) For the three months and year ended December 31, 2016,
the amount includes $0.7 million and $2.5 million, respectively, of
expense associated with the deferred compensation arrangements
resulting from an amendment to the Swyft Merger Agreement and $0.9
million and $1.4 million, respectively, of expense associated with
the deferred compensation arrangements with the founders of Olapic
in connection with the acquisition.
(2) For the three months and year ended December 31, 2015,
the amount includes $4.2 million and $4.2 million, respectively, of
expense associated with the deferred compensation arrangements
resulting from an amendment to the Swyft Merger Agreement.
RECONCILIATION OF GAAP EARNINGS PER
DILUTED SHARE TO NON-GAAP EARNINGS PER DILUTED SHARE
Three Months EndedDecember 31, Year
EndedDecember 31,
2016(1)
2015
2016(1)
2015 GAAP earnings per diluted share $ 0.01 $ 0.12 $ 0.36 $
0.65 Amortization, net of tax of $0.03, $0.02, $0.08 and $0.07,
respectively 0.02 0.02 0.12 0.13 Share based compensation, net of
tax of $0.07, $0.05, $0.18 and $0.12, respectively 0.05 0.05 0.27
0.23
Acquisition-related compensation, net of
tax of $0.00, $0.00, $0.00 and $0.00, respectively
0.04 0.11 0.10 0.11
Non-GAAP earnings per diluted share
$ 0.12 $ 0.30 $ 0.85 $ 1.12
(1) For the three months and year ended December 31, 2016,
the amount includes $0.7 million and $2.5 million, respectively, of
expense associated with the deferred compensation arrangements
resulting from an amendment to the Swyft Merger Agreement and $0.9
million and $1.4 million, respectively, of expense associated with
the deferred compensation arrangements with the founders of Olapic
in connection with the acquisition.
MONOTYPE IMAGING HOLDINGS INC.
OTHER INFORMATION
(Unaudited and in thousands)
RECONCILIATION OF GAAP NET INCOME TO
PRO FORMA NON-GAAP NET ADJUSTED EBITDA
Three Months EndedDecember 31, 2016
Monotype Olapic
Combined GAAP net income (loss) $ 4,282 $
(3,832 ) $ 450 Interest expense, net 678 — 678 Other
(income) expense, net (1,262 ) 748 (514 ) Provision (benefit) for
income taxes(1) 4,846 (4,204 )
642 Income (loss) from operations(1) 8,544
(7,288 ) 1,256 Pre-acquisition net adjusted EBITDA(2) — — —
Deferred revenue impairment(3) — 2,456 2,456 Depreciation and
amortization 2,492 673 3,165 Share based compensation 3,593 973
4,566
Acquisition-related compensation(4)
761 875 1,636 Transaction costs(5) — —
— Pro Forma non-GAAP net
adjusted EBITDA $ 15,390 $ (2,311 )
$ 13,079
(1) Olapic Pro Forma provision (benefit) for income taxes and
income (loss) from operations includes unaudited estimated
pre-acquisition tax impact.
(2) Pro Forma non-GAAP net adjusted EBITDA has no
pre-acquisition non-GAAP net adjusted EBITDA adjustments in the
three months ended December 31, 2016. We acquired Olapic on August
9, 2016.
(3) Pro Forma non-GAAP net adjusted EBITDA includes $0, $2.5
million and $2.5 million, respectively, to add back the estimated
purchase accounting adjustment for the impairment of deferred
revenue.
(4) Acquisition-related compensation includes $0.7 million, $0.9
million and $1.6 million, respectively, of expense associated with
the deferred compensation arrangements resulting from an amendment
to the Swyft Merger Agreement and expense associated with the
deferred compensation arrangements with the founders of Olapic in
connection with the acquisition.
(5) In the three months ended December 31, 2016, the Company did
not incur any transaction expenses for the Olapic acquisition.
Consequently, there is no adjustment to Pro Forma non-GAAP net
adjusted EBITDA for these type of costs.
RECONCILIATION OF GAAP NET INCOME TO
PRO FORMA NON-GAAP NET ADJUSTED EBITDA
Year Ended
December 31, 2016
Monotype Olapic
Combined GAAP net income (loss) $ 23,293 $
(8,407 ) $ 14,886 Interest expense, net 1,227 — 1,227
Other (income) expense, net (772 ) 737 (35 ) Provision (benefit)
for income taxes(1) 14,458
(4,145 ) 10,313 Income (loss)
from operations(1) 38,206 (11,815 ) 26,391 Pre-acquisition net
adjusted EBITDA(2) — (11,390 ) (11,390 ) Deferred revenue
impairment(3) — 3,159 3,159 Depreciation and amortization 11,168
1,111 12,279 Share based compensation 15,689 1,582 17,271
Acquisition-related compensation(4)
2,495 1,374 3,869 Transaction costs(5) 1,125
— 1,125 Pro
Forma non-GAAP net adjusted EBITDA $ 68,683 $
(15,979 ) $ 52,704
(1) Olapic Pro Forma provision (benefit) for income taxes and
income (loss) from operations includes unaudited estimated
pre-acquisition tax impact.
(2) Pro Forma non-GAAP net adjusted EBITDA includes $0, ($11.4)
million and ($11.4) million, respectively, of estimated Olapic
non-GAAP net adjusted EBITDA recognized during the period of
January 1, 2016 to August 8, 2016. We acquired Olapic on August 9,
2016.
(3) Pro Forma non-GAAP net adjusted EBITDA includes $0, $3.2
million and $3.2 million, respectively, to add back the estimated
purchase accounting adjustment for the impairment of deferred
revenue.
(4) Acquisition-related compensation includes $2.5 million, $1.4
million and $3.9 million, respectively, of expense associated with
the deferred compensation arrangements resulting from an amendment
to the Swyft Merger Agreement and expense associated with the
deferred compensation arrangements with the founders of Olapic in
connection with the acquisition.
(5) Pro Forma non-GAAP net adjusted EBITDA excludes $1.1
million, $0 and $1.1 million, respectively, of transaction expenses
incurred with the Olapic acquisition.
MONOTYPE IMAGING HOLDINGS INC.
OTHER INFORMATION
(Unaudited and in thousands)
OTHER INFORMATION
Share based compensation is comprised of
the following:
Three Months EndedDecember 31, Year
EndedDecember 31, 2016 2015 2016
2015 Marketing and selling $ 2,028 $ 1,744 $ 7,377 $ 6,312
Research and development 1,218 639 4,087 2,458 General and
administrative 1,320 1,359 5,807 4,813
Total expensed $ 4,566 $ 3,742 $ 17,271 $ 13,583 Property
and equipment — — — 82 Total
share based compensation $ 4,566 $ 3,742 $ 17,271 $ 13,665
MARKET INFORMATION
The following table presents revenue for
our two major markets:
Three Months EndedDecember 31, Year
EndedDecember 31, 2016 2015 2016
2015 Creative Professional $ 27,211 $ 24,420 $ 102,381 $
88,074 OEM 25,426 26,196 101,060
104,345 Total $ 52,637 $ 50,616 $ 203,441 $ 192,419
MONOTYPE IMAGING HOLDINGS INC.
RECONCILIATION OF FORECAST GAAP REVENUE
TO
FORECAST PRO FORMA NON-GAAP
REVENUE
(Unaudited and in thousands)
Low End of Guidance Q1 2017 Monotype
Olapic Combined GAAP
revenue $ 48,000 $ 3,500 $ 51,500
Deferred revenue impairment - 1,400
1,400
Pro Forma non-GAAP revenue
$ 48,000 $ 4,900 $ 52,900
High End of Guidance Q1 2017
Monotype Olapic
Combined GAAP revenue $ 51,000 $ 4,500
$ 55,500 Deferred revenue impairment - 1,400
1,400
Pro Forma non-GAAP revenue
$ 51,000 $ 5,900 $ 56,900
Low End of Guidance 2017
Monotype Olapic
Combined GAAP revenue $ 206,500 $ 22,500
$ 229,000 Deferred revenue impairment -
3,300 3,300
Pro Forma non-GAAP revenue
$ 206,500 $ 25,800 $ 232,300
High End of Guidance 2017
Monotype Olapic
Combined GAAP revenue $ 211,500 $ 25,500
$ 237,000 Deferred revenue impairment -
3,300 3,300
Pro Forma non-GAAP revenue
$ 211,500 $ 28,800 $ 240,300
MONOTYPE IMAGING HOLDINGS INC.
RECONCILIATION OF FORECAST GAAP NET
INCOME TO
FORECAST NON-GAAP NET ADJUSTED
EBITDA
(Unaudited and in thousands)
Low End of Guidance
Q1 2017 Monotype Olapic
Combined GAAP net income (loss) $ 2,900
$ (4,000 ) $ (1,100 ) Interest expense, net 900 - 900
Other (income) expense, net 300 - 300 Provision (benefit) for
income taxes 2,900 (4,100 )
(1,200 ) Income (loss) from operations 7,000
(8,100 ) (1,100 ) Depreciation and amortization 2,200 800 3,000
Share based compensation 4,000 1,200 5,200
Acquisition-related compensation(1)
500 900
1,400 Non-GAAP net adjusted EBITDA $ 13,700
$ (5,200 ) $ 8,500
(1) Includes charges to operations for portions of merger
consideration accounted for as compensation expense under GAAP.
High End of Guidance
Q1 2017 Monotype Olapic
Combined GAAP net income (loss) $ 3,900
$ (3,600 ) $ 300 Interest expense, net 900 - 900
Other (income) expense, net 300 - 300 Provision (benefit) for
income taxes 4,100 (3,700 )
400 Income (loss) from operations 9,200 (7,300
) 1,900 Depreciation and amortization 2,200 800 3,000 Share based
compensation 4,000 1,200 5,200
Acquisition-related compensation(1)
500 900
1,400 Non-GAAP net adjusted EBITDA $ 15,900 $
(4,400 ) $ 11,500
(1) Includes charges to operations for portions of merger
consideration accounted for as compensation expense under GAAP.
MONOTYPE IMAGING HOLDINGS INC.
RECONCILIATION OF FORECAST GAAP NET
INCOME TO
FORECAST NON-GAAP NET ADJUSTED
EBITDA
(Unaudited and in thousands)
Low End of Guidance
2017 Monotype Olapic
Combined GAAP net income (loss) $ 16,700
$ (15,300 ) $ 1,400 Interest expense, net
3,200 - 3,200 Other (income) expense, net 1,200 - 1,200 Provision
(benefit) for income taxes 17,400
(15,900 ) 1,500 Income (loss) from
operations 38,500 (31,200 ) 7,300 Depreciation and amortization
9,300 3,100 12,400 Share based compensation 17,100 5,100 22,200
Acquisition-related compensation(1)
2,100 3,500
5,600 Non-GAAP net adjusted EBITDA $ 67,000 $
(19,500 ) $ 47,500
(1) Includes charges to operations for portions of merger
consideration accounted for as compensation expense under GAAP.
High End of Guidance
2017 Monotype Olapic
Combined GAAP net income (loss) $ 18,800
$ (14,100 ) $ 4,700 Interest expense, net
3,200 - 3,200 Other (income) expense, net 1,200 - 1,200 Provision
(benefit) for income taxes 19,500
(14,700
)
4,800
Income (loss) from operations 42,700
(28,800
)
13,900
Depreciation and amortization 9,300 3,100 12,400 Share based
compensation 17,100 5,100 22,200
Acquisition-related compensation(1)
2,100 3,500
5,600 Non-GAAP net adjusted EBITDA $ 71,200 $
(17,100
) $
54,100
(1) Includes charges to operations for portions of merger
consideration accounted for as compensation expense under GAAP.
MONOTYPE IMAGING HOLDINGS INC.
RECONCILIATION OF FORECAST GAAP NET
INCOME TO
FORECAST PRO FORMA NON-GAAP NET
ADJUSTED EBITDA
(Unaudited and in thousands)
Low End of Guidance
Q1 2017 Monotype Olapic
Combined GAAP net income (loss) $ 2,900
$ (4,000 ) $ (1,100 ) Interest expense, net 900 - 900
Other (income) expense, net 300 - 300 Provision (benefit) for
income taxes 2,900 (4,100 )
(1,200 ) Income (loss) from operations 7,000 (8,100 )
(1,100 ) Deferred revenue impairment(1) - 1,400 1,400 Depreciation
and amortization 2,200 800 3,000 Share based compensation
4,000 1,200 5,200
Acquisition-related compensation(2)
500 900
1,400
Pro Forma non-GAAP net adjusted EBITDA
$ 13,700 $ (3,800 ) $ 9,900
(1) Pro Forma non-GAAP net adjusted EBITDA includes $0, $1.4
million and $1.4 million, respectively, to add back the estimated
purchase accounting adjustment for the impairment of deferred
revenue.
(2) Includes charges to operations for portions of merger
consideration accounted for as compensation expense under GAAP.
High End of Guidance
Q1 2017 Monotype Olapic
Combined GAAP net income (loss) $ 3,900
$ (3,600 ) $ 300 Interest expense, net 900 - 900
Other (income) expense, net 300 - 300 Provision (benefit) for
income taxes 4,100 (3,700 )
400 Income (loss) from operations 9,200 (7,300
) 1,900 Deferred revenue impairment(1) - 1,400 1,400 Depreciation
and amortization 2,200 800 3,000 Share based compensation 4,000
1,200 5,200
Acquisition-related compensation(2)
500 900
1,400
Pro Forma non-GAAP net adjusted EBITDA
$ 15,900 $ (3,000 ) $ 12,900
(1) Pro Forma non-GAAP net adjusted EBITDA includes $0, $1.4
million and $1.4 million, respectively, to add back the estimated
purchase accounting adjustment for the impairment of deferred
revenue.
(2) Includes charges to operations for portions of merger
consideration accounted for as compensation expense under GAAP.
MONOTYPE IMAGING HOLDINGS INC.
RECONCILIATION OF FORECAST GAAP NET
INCOME TO
FORECAST PRO FORMA NON-GAAP NET
ADJUSTED EBITDA
(Unaudited and in
thousands)
Low End of Guidance
2017 Monotype Olapic
Combined GAAP net income (loss) $ 16,700
$ (15,300 ) $ 1,400 Interest expense, net
3,200 - 3,200 Other (income) expense, net 1,200 - 1,200 Provision
(benefit) for income taxes 17,400
(15,900 ) 1,500 Income (loss) from
operations 38,500 (31,200 ) 7,300
Deferred revenue impairment(1)
- 3,300 3,300 Depreciation and amortization 9,300 3,100 12,400
Share based compensation 17,100 5,100 22,200
Acquisition-related compensation(2)
2,100 3,500
5,600
Pro Forma non-GAAP net adjusted EBITDA
$ 67,000 $ (16,200 ) $ 50,800
(1) Pro Forma non-GAAP net adjusted EBITDA includes $0, $3.3
million and $3.3 million, respectively, to add back the estimated
purchase accounting adjustment for the impairment of deferred
revenue.
(2) Includes charges to operations for portions of merger
consideration accounted for as compensation expense under GAAP.
High End of Guidance
2017 Monotype Olapic
Combined GAAP net income (loss) $ 18,800
$ (14,100 ) $ 4,700 Interest expense, net
3,200 - 3,200 Other (income) expense, net 1,200 - 1,200 Provision
(benefit) for income taxes 19,500
(14,700
)
4,800
Income (loss) from operations 42,700
(28,800
)
13,900
Deferred revenue impairment(1)
- 3,300 3,300 Depreciation and amortization 9,300 3,100 12,400
Share based compensation 17,100 5,100 22,200
Acquisition-related compensation(2)
2,100 3,500
5,600
Pro Forma non-GAAP net adjusted EBITDA
$ 71,200 $
(13,800
)
$
57,400
(1) Pro Forma non-GAAP net adjusted EBITDA includes $0, $3.3
million and $3.3 million, respectively, to add back the estimated
purchase accounting adjustment for the impairment of deferred
revenue.
(2) Includes charges to operations for portions of merger
consideration accounted for as compensation expense under GAAP.
MONOTYPE IMAGING HOLDINGS INC.
RECONCILIATION OF FORECAST GAAP
EARNINGS PER DILUTED SHARE TO
FORECAST NON-GAAP EARNINGS PER DILUTED
SHARE
(Unaudited and in thousands, except
share and per share data)
Low End of Guidance Q1 2017
Monotype Olapic
Combined GAAP net income (loss) $ 2,900 $ (4,000 ) $ (1,100
) Amortization, net of tax of $700, $400 and $1,100, respectively
600 300 900
Share based compensation, net of tax of
$2,100, $600 and $2,700, respectively
1,900
600
2,500
Acquisition-related compensation, net of
tax of $0, $0 and $0, respectively(1)
500
900
1,400
Non-GAAP net income (loss) $ 5,900 $
(2,200 ) $ 3,700 GAAP earnings
(loss) per diluted share $ 0.07 $ (0.10 ) $ (0.03 ) Amortization,
net of tax of $0.02, $0.01 and $0.03, respectively, per diluted
share
0.02
0.01
0.03
Share based compensation, net of tax of
$0.05, $0.02 and $0.07, respectively, per diluted share
0.04
0.02
0.06
Acquisition-related compensation, net of
tax of $0.00, $0.00 and $0.00, respectively, per diluted
share(1)
0.02
0.01
0.03
Non-GAAP earnings (loss) per diluted share $ 0.15
$ (0.06 ) $ 0.09 Weighted
average diluted shares used to compute earnings per share
39,700,000 39,700,000 39,700,000
Assumes 51% effective tax rate.(1) Includes charges to
operations for portions of merger consideration accounted for as
compensation expense under GAAP.
High End of Guidance Q1 2017 Monotype
Olapic Combined GAAP net income
(loss) $ 3,900 $ (3,600 ) $ 300 Amortization, net of tax of $700,
$400 and $1,100, respectively 600 300 900
Share based compensation, net of tax of
$2,100, $600 and $2,700, respectively
1,900
600
2,500
Acquisition-related compensation, net of
tax of $0, $0 and $0, respectively(1)
500
900
1,400
Non-GAAP net income (loss) $ 6,900 $ (1,800 ) $ 5,100
GAAP earnings (loss) per diluted share $ 0.10 $ (0.09 ) $
0.01 Amortization, net of tax of $0.02, $0.01 and $0.03,
respectively, per diluted share
0.02
0.01
0.03
Share based compensation, net of tax of
$0.05, $0.02 and $0.07, respectively, per diluted share
0.04
0.02
0.06
Acquisition-related compensation, net of
tax of $0.00, $0.00 and $0.00, respectively, per diluted
share(1)
0.02
0.01
0.03
Non-GAAP earnings (loss) per diluted share $ 0.18 $ (0.05 )
0.13 Weighted average diluted shares used to compute
earnings per share 39,700,000 39,700,000 39,700,000
Assumes 51% effective tax rate.(1) Includes charges to
operations for portions of merger consideration accounted for as
compensation expense under GAAP.
MONOTYPE IMAGING HOLDINGS INC.
RECONCILIATION OF FORECAST GAAP
EARNINGS PER DILUTED SHARE TO
FORECAST NON-GAAP EARNINGS PER DILUTED
SHARE
(Unaudited and in thousands, except
share and per share data)
Low End of Guidance 2017
Monotype Olapic
Combined GAAP net income (loss) $ 16,700 $ (15,300 ) $ 1,400
Amortization, net of tax of $2,600, $1,400 and $3,000, respectively
2,500 1,400 3,900 Share based compensation, net of tax of $8,700,
$2,600 and $11,300, respectively
8,400
2,500
10,900
Acquisition-related compensation, net of
tax of $0, $0 and $0, respectively(1)
2,100
3,500
5,600
Non-GAAP net income (loss) $ 29,700 $ (7,900 ) $ 21,800
GAAP earnings (loss) per diluted share $ 0.42 $ (0.38
) $ 0.04 Amortization, net of tax of $0.06, $0.03 and $0.09,
respectively, per diluted share
0.06
0.03
0.09
Share based compensation, net of tax of $0.22, $0.06 and $0.28,
respectively, per diluted share
0.21
0.06
0.27
Acquisition-related compensation, net of
tax of $0.00, $0.00 and $0.00, respectively, per diluted
share(1)
0.05
0.09
0.14
Non-GAAP earnings (loss) per diluted share $ 0.74 $ (0.20 )
$ 0.54 Weighted average diluted shares used to compute
earnings per share 40,100,000 40,100,000 40,100,000
Assumes 51% effective tax rate.(1) Includes charges to
operations for portions of merger consideration accounted for as
compensation expense under GAAP.
High End of Guidance 2017 Monotype
Olapic Combined GAAP net income
(loss) $ 18,800 $ (14,100 ) $ 4,700 Amortization, net of tax of
$2,600, $1,400 and $3,000, respectively 2,500 1,400 3,900 Share
based compensation, net of tax of $8,700, $2,600 and $11,300,
respectively
8,400
2,500
10,900
Acquisition-related compensation, net of
tax of $0, $0 and $0, respectively (1)
2,100
3,500
5,600
Non-GAAP net income (loss)
$ 31,800 $ (6,700 ) $ 25,100 GAAP earnings (loss) per
diluted share $ 0.47 $ (0.35 ) $ 0.12 Amortization, net of tax of
$0.06, $0.03 and $0.09, respectively, per diluted share
0.06
0.03
0.09
Share based compensation, net of tax of $0.22, $0.06 and $0.28,
respectively, per diluted share
0.21
0.06
0.27
Acquisition-related compensation, net of
tax of $0.00, $0.00 and $0.00, respectively, per diluted share
(1)
0.05
0.09
0.14
Non-GAAP earnings (loss) per diluted share $ 0.79 $ (0.17 )
$ 0.62 Weighted average diluted shares used to compute
earnings per share 40,100,000 40,100,000 40,100,000
Assumes 51% effective tax rate.(1) Includes charges to
operations for portions of merger consideration accounted for as
compensation expense under GAAP.
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version on businesswire.com: http://www.businesswire.com/news/home/20170217005179/en/
Investor Relations:MonotypeChris Brooks,
781-970-6120ir@monotype.com
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