Avid® (NASDAQ: AVID), a leading technology provider that powers the
media and entertainment industry, today announced its financial
results for the fourth quarter and full year ended December 31,
2020.
Total revenue increased 15.3% sequentially in the fourth
quarter, as many of Avid’s end markets showed continued signs of
recovery from the COVID-19 pandemic, while still lower
year-over-year. During the fourth quarter, the Recurring Revenue
components of the Company’s business remained strong with reported
subscription revenue of $24.5 million, up 54.9% year-over-year,
reflecting strong enterprise subscription sales in the quarter. At
the end of 2020, the Company had $231.3 million in Revenue Backlog
expected to be recognized during the next 12 months, up 16.0% from
the end of 2019. Also, in the fourth quarter, improved
profitability and strong seasonal contribution from working capital
resulted in Free Cash Flow of $30.6 million for the quarter, the
highest quarterly amount since 2007.
The non-Recurring Revenue portions of the Company’s business
related to product and professional services continued to show
strong signs of sequential recovery during the fourth quarter,
although they still remain below pre-COVID levels. Product revenue
from perpetual software licenses and integrated solutions increased
19.2% sequentially, to $42.6 million, in the fourth quarter, but
declined by 28.7% year-over-year.
For the full year 2020, Avid’s revenues were negatively impacted
by the COVID-19 pandemic, decreasing 12.5% from 2019. However,
subscription revenue grew 61.2%, to $72.8 million, surpassing 20%
of total revenue, up from 11% in 2019. During 2020, the Company saw
a 280 basis point increase in gross margin, to 63.3%, primarily due
to a greater mix of software and subscription sales during the
year. The benefit from the higher gross margin and a decrease in
operating expenses from cost savings realized during the year
resulted in improved profitability and cash generation. As of
December 31, 2020, the Company had $79.9 million in cash and cash
equivalents.
Fourth Quarter 2020 Financial and Business
Highlights
- Subscription revenue was $24.5
million, an increase of 54.9% year-over-year.
- Paid Cloud-enabled software
subscriptions increased by 57.8% year-over-year to approximately
296,000 at December 31, 2020, and increased by approximately 27,000
during the fourth quarter.
- Subscription and maintenance revenue
was $55.5 million, up 12.7% year-over-year.
- Total revenue was $104.3 million, an
increase of 15.3% sequentially, and a decrease of (10.3%)
year-over-year.
- Gross margin was 62.7%, a decrease
of 30 basis points year-over-year. Non-GAAP Gross Margin was 63.1%,
a decrease of 10 basis points year-over-year.
- Operating expenses were $54.5
million, a decrease of (5.3%) year-over-year. Non-GAAP Operating
Expenses were $46.3 million, a decrease of (14.9%)
year-over-year.
- Operating income was $10.8 million,
a decrease of (31.0%) year-over-year. Non-GAAP Operating Income was
$19.4 million, an increase of 2.1% year-over-year.
- Adjusted EBITDA was $21.6 million,
an increase of 2.0% year-over-year. Adjusted EBITDA Margin was
20.7%, a year-over-year increase of 250 basis
points.
- Net income per common share was
$0.16, a decline from $0.35 in the fourth quarter of 2019. Net
income per common share in the prior year period included a
one-time benefit of $0.14 per share related to a valuation
allowance against certain deferred tax assets. Non-GAAP Net Income
per Share was $0.33, up from $0.28 in the fourth quarter of
2019.
- Net cash provided by operating
activities was $30.7 million in the quarter, an increase of $12.2
million compared to Net cash provided by operating activities of
$18.5 million in the prior year period.
- Free Cash Flow was $30.6 million in
the quarter, an increase of $13.7 million compared to Free Cash
Flow of $17.0 million in the prior year period.
FY 2020 Financial and Business Highlights
- Subscription revenue was $72.8
million, an increase of 61.2% year-over-year.
- Subscription and maintenance revenue
was $197.0 million, an increase of 12.2% year-over-year.
- Total revenue was $360.5 million, a
decrease of (12.5%) year-over-year.
- LTM Recurring Revenue represented
74.2% of the Company’s revenue for the year ended December 31,
2020, an increase of 1,210 basis points, from 62.1% for the prior
year.
- Gross margin was 63.3%, an increase
of 280 basis points year-over-year. Non-GAAP Gross Margin was
63.7%, an increase of 220 basis points year-over-year.
- Operating expenses were $196.8
million, a decrease of (9.3%) year-over-year. Non-GAAP Operating
Expenses were $179.5 million, a decrease of (13.1%)
year-over-year.
- Operating income was $31.6 million,
a decrease of (1.7%) year-over-year. Non-GAAP Operating Income was
$50.1 million, an increase of 7.1% year-over-year.
- Adjusted EBITDA was $58.6 million,
an increase of 4.7% year-over-year. Adjusted EBITDA Margin was
16.3%, an increase of 270 basis points year-over-year.
- Net income per common share was
$0.25, up from $0.17 in 2019. Non-GAAP Net Income per Share was
$0.65, an increase of 27.3% from $0.51 in 2019.
- Net cash provided by operating
activities was $39.6 million in 2020, an increase of $19.9 million
compared to Net cash provided by operating activities of $19.6
million in 2019.
- Free Cash Flow was $33.9 million in
2020, an increase of $21.4 million compared to Free Cash Flow of
$12.5 million in 2019.
- Annual Contract Value was $300.6
million at December 31, 2020, an increase of 7.4% from $279.8
million at December 31, 2019.
Jeff Rosica, Avid’s CEO and President, stated, “We are excited
about the strength of, and growth in, our Recurring Revenue
business during the fourth quarter. The growth in our Recurring
Revenue was driven primarily by the continued expansion in our
subscription revenues, which have now experienced a second stage of
growth as we had several enterprise customers adopt subscription
plans during the quarter. On top of the continued turnaround and
sequential improvement we experienced in the non-recurring elements
of our business, we also saw strong fourth quarter bookings and
billings performance that helped drive a stronger opening Revenue
Backlog for 2021, thus better positioning us as we started the new
year.” Mr. Rosica added, “As our customers adjust their business
models, we believe they will continue to invest in value-added
technology and that we are well-positioned to meet these needs for
them. Importantly, we also expect the full-year benefit from our
optimized cost structure will enable Avid to be a stronger and more
profitable company in 2021 and beyond.”
Ken Gayron, Executive Vice President and Chief Financial Officer
of Avid, said, “We are pleased that we continued to make
substantial progress in driving our higher margin revenue streams
and improving our cost structure during the fourth quarter,
yielding our strongest quarterly Free Cash Flow since 2007. This
improvement in Free Cash Flow further strengthened our balance
sheet and positioned us for the successful refinancing of our bank
debt that we completed in January 2021.” Mr. Gayron continued, “Our
successful refinancing should reduce our annual interest costs by
approximately $10 million, which, coupled with the expected
improvement in our business, should allow us to drive further
improvement in Free Cash Flow as we look forward to the remainder
of 2021 and beyond.”
First Quarter and Full Year 2021 Guidance
For the first quarter of 2021, Avid is providing guidance for
Revenue, Subscription & Maintenance Revenue, Adjusted EBITDA
and Non-GAAP Net Income per Share. For the full-year 2021, Avid is
providing guidance for Subscription & Maintenance Revenue and
Free Cash Flow. Avid currently plans to add additional metrics to
its guidance for full-year 2021 later in the year and to host an
Investor Day in May 2021.
($ in millions, except per share amounts) |
Q1 2021 |
Revenue |
$88 - $94 |
Subscription & Maintenance
Revenue |
$50 - $53 |
Adjusted EBITDA |
$12.2 - $15.8 |
Non-GAAP Net Income per
Share |
$0.17 - $0.24 |
|
|
|
Full-Year 2021 |
Subscription & Maintenance
Revenue |
$214 - $221 |
Free Cash Flow |
$45 - $52 |
All guidance presented by the Company is inherently uncertain
and subject to numerous risks and uncertainties. Avid’s actual
future results of operations could differ materially from those
shown in the table above. For a discussion of some of the key
assumptions underlying the guidance, as well as the key risks and
uncertainties associated with these forward-looking statements,
please see “Forward-Looking Statements” below as well as the Avid
Technology Q4 and Full-Year 2020 Business Update presentation
posted on Avid’s Investor Relations website at ir.avid.com.
Conference Call to Discuss Fourth Quarter and FY 2020
Results on March 9, 2021
Avid will host a conference call to discuss its financial
results for the fourth quarter and FY 2020 on Tuesday, March 9,
2021 at 5:00 p.m. ET. Participants may join the webcast in
listen-only mode and access the presentation slides using the link
on the Avid Investor Relations website, which can be found on the
events tab at ir.avid.com. Participants who would like to ask a
question can access the call by dialing +1 856-344-9206 and
referencing confirmation code 1881087. Please connect at least 15
minutes in advance to ensure a timely connection to the call. A
replay of the call will also be available for a limited time on the
Avid Investor Relations website shortly after the completion of the
call.
Non-GAAP Financial Measures and Operational
Metrics
Avid includes non-GAAP financial measures in this press release,
including Adjusted EBITDA, Adjusted EBITDA Margin, Free Cash Flow,
Non-GAAP Gross Margin, Non-GAAP Operating Expenses, Non-GAAP
Operating Income, Non-GAAP Net Income (Loss) per Share. The Company
also includes the operational metrics of Cloud-enabled software
subscriptions, Revenue Backlog, Recurring Revenue, LTM Recurring
Revenue % and Annual Contract Value in this release. Avid believes
the non-GAAP financial measures and operational metrics provided in
this release provide helpful information to investors with respect
to evaluating the Company’s performance. Unless noted, all
financial and operating information is reported based on actual
exchange rates. Definitions of the non-GAAP financial measures and
the operational metrics are included in our Form 8-K filed today.
Reconciliations of the non-GAAP financial measures presented in
this press release to the Company's comparable GAAP financial
measures for the periods presented are set forth below and are also
included in the supplemental financial and operational data sheet
available on our Investor Relations website at ir.avid.com, which
also includes definitions of all operational metrics.
Forward-Looking Statements
Certain information provided in this press release includes
forward-looking statements within the meaning of the Securities Act
of 1933 and the Securities Exchange Act of 1934, which are made
pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Examples of forward-looking
statements include statements regarding our future financial
performance or position, results of operations, business strategy,
plans and objectives of management for future operations, and other
statements that are not historical fact. You can identify
forward-looking statements by their use of forward-looking words
such as “may”, “will”, “anticipate”, “expect”, “believe”,
“estimate”, “intend”, “plan”, “should”, “seek”, or other comparable
terms.
Readers of this press release should understand that these
forward-looking statements are not guarantees of performance or
results. Forward-looking statements provide our current
expectations and beliefs concerning future events and are subject
to risks, uncertainties, and factors relating to our business and
operations, all of which are difficult to predict and could cause
our actual results to differ materially from the expectations
expressed in or implied by such forward-looking statements.
These risks, uncertainties, and factors include, but are not
limited to: risks related to the impact of the coronavirus
(COVID-19) outbreak on our business, suppliers, consumers,
customers and employees; our liquidity; our ability to execute our
strategic plan including our cost saving strategies, and to meet
customer needs; our ability to retain and hire key personnel; our
ability to produce innovative products in response to changing
market demand, particularly in the media industry; our ability to
successfully accomplish our product development plans; competitive
factors; history of losses; fluctuations in our revenue based on,
among other things, our performance and risks in particular
geographies or markets; our higher indebtedness and ability to
service it and meet the obligations thereunder; restrictions in our
credit facilities; our move to a subscription model and related
effect on our revenues and ability to predict future revenues;
fluctuations in subscription and maintenance renewal rates;
elongated sales cycles; fluctuations in foreign currency exchange
rates; seasonal factors; adverse changes in economic conditions;
variances in our revenue backlog and the realization thereof; risks
related to the availability and prices of raw materials, including
any negative effects caused by inflation, weather conditions, or
health pandemics; disruptions or inefficiencies in our supply chain
and/or operations, including from the COVID-19 outbreak; the costs,
disruption, and diversion of management's attention due to the
COVID-19 outbreak; the possibility of legal proceedings adverse to
our Company; and other risks described in our reports filed from
time to time with the U.S. Securities and Exchange Commission.
Moreover, the business may be adversely affected by future
legislative, regulatory or other changes, including tax law
changes, as well as other economic, business and/or competitive
factors. The risks included above are not exhaustive. We caution
readers not to place undue reliance on any forward-looking
statements includes in this press release which speak only as to
the date of this press release. We undertake no responsibility to
update or revise any forward-looking statements, except as required
by law.
About Avid
Avid delivers the most open and efficient media platform,
connecting content creation with collaboration, asset protection,
distribution, and consumption. Avid’s preeminent customer community
uses Avid’s comprehensive tools and workflow solutions to create,
distribute and monetize the most watched, loved and listened to
media in the world—from prestigious and award-winning feature films
to popular television shows, news programs and televised sporting
events, and celebrated music recordings and live concerts. With the
most flexible deployment and pricing options, Avid’s
industry-leading solutions include Media Composer®, Pro Tools®,
Avid NEXIS®, MediaCentral®, iNEWS®, AirSpeed®, Sibelius®, Avid
VENUE™, FastServe®™ and Maestro™. For more information about Avid
solutions and services, visit www.avid.com, connect with Avid on
Facebook, Instagram, Twitter, YouTube, LinkedIn, or subscribe to
Avid Blogs.
© 2021 Avid Technology, Inc. All rights reserved. Avid, the Avid
logo, Avid NEXIS, FastServe, AirSpeed, iNews, Maestro,
MediaCentral, Media Composer, Pro Tools, Avid VENUE, and Sibelius
are trademarks or registered trademarks of Avid Technology, Inc. or
its subsidiaries in the United States and/or other countries. All
other trademarks are the property of their respective owners.
Product features, specifications, system requirements and
availability are subject to change without notice.
Contacts |
|
Investor contact: |
PR contact: |
Whit Rappole |
Jim Sheehan |
Avid |
Avid |
ir@avid.com |
jim.sheehan@avid.com |
|
|
AVID TECHNOLOGY, INC. |
|
|
|
|
|
|
|
|
Condensed Consolidated Statements of
Operations |
|
|
|
|
|
|
|
|
(unaudited - in thousands, except per share data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended |
|
Twelve
Months Ended |
|
|
|
December 31, |
|
December 31, |
|
|
|
|
2020 |
|
|
|
2019 |
|
|
|
2020 |
|
|
|
2019 |
|
|
|
|
|
|
|
|
|
|
|
Net revenues: |
|
|
|
|
|
|
|
|
|
Products |
|
$ |
42,642 |
|
|
$ |
59,812 |
|
|
$ |
140,762 |
|
|
$ |
207,445 |
|
|
Services |
|
|
61,659 |
|
|
|
56,494 |
|
|
|
219,704 |
|
|
|
204,343 |
|
|
Total net revenues |
|
|
104,301 |
|
|
|
116,306 |
|
|
|
360,466 |
|
|
|
411,788 |
|
|
|
|
|
|
|
|
|
|
|
Cost of revenues: |
|
|
|
|
|
|
|
|
|
Products |
|
|
25,349 |
|
|
|
30,264 |
|
|
|
84,222 |
|
|
|
109,799 |
|
|
Services |
|
|
13,602 |
|
|
|
12,769 |
|
|
|
47,924 |
|
|
|
49,176 |
|
|
Amortization
of intangible assets |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
3,738 |
|
|
Total cost of revenues |
|
|
38,951 |
|
|
|
43,033 |
|
|
|
132,146 |
|
|
|
162,713 |
|
|
|
|
|
|
|
|
|
|
|
Gross profit |
|
|
65,350 |
|
|
|
73,273 |
|
|
|
228,320 |
|
|
|
249,075 |
|
|
|
|
|
|
|
|
|
|
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
Research and
development |
|
|
14,902 |
|
|
|
16,018 |
|
|
|
57,018 |
|
|
|
62,343 |
|
|
Marketing
and selling |
|
|
22,660 |
|
|
|
26,603 |
|
|
|
87,637 |
|
|
|
99,944 |
|
|
General and
administrative |
|
|
12,908 |
|
|
|
14,816 |
|
|
|
47,052 |
|
|
|
53,362 |
|
|
Amortization
of intangible assets |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
694 |
|
|
Restructuring costs, net |
|
|
4,038 |
|
|
|
113 |
|
|
|
5,046 |
|
|
|
629 |
|
|
Total operating expenses |
|
|
54,508 |
|
|
|
57,550 |
|
|
|
196,753 |
|
|
|
216,972 |
|
|
|
|
|
|
|
|
|
|
|
Operating income |
|
|
10,842 |
|
|
|
15,723 |
|
|
|
31,567 |
|
|
|
32,103 |
|
|
|
|
|
|
|
|
|
|
|
Interest and other expense, net |
|
|
(3,929 |
) |
|
|
(5,584 |
) |
|
|
(19,133 |
) |
|
|
(29,578 |
) |
Income before income taxes |
|
|
6,913 |
|
|
|
10,139 |
|
|
|
12,434 |
|
|
|
2,525 |
|
|
|
|
|
|
|
|
|
|
|
Provision for (benefit from) income taxes |
|
|
(174 |
) |
|
|
(5,231 |
) |
|
|
1,372 |
|
|
|
(5,076 |
) |
Net income |
|
$ |
7,087 |
|
|
$ |
15,370 |
|
|
$ |
11,062 |
|
|
$ |
7,601 |
|
|
|
|
|
|
|
|
|
|
|
Net income per common share - basic |
|
$ |
0.16 |
|
|
$ |
0.36 |
|
|
$ |
0.25 |
|
|
$ |
0.18 |
|
Net income per common share - diluted |
|
$ |
0.16 |
|
|
$ |
0.35 |
|
|
$ |
0.25 |
|
|
$ |
0.17 |
|
|
|
|
|
|
|
|
|
|
|
Weighted-average common shares outstanding - basic |
|
|
44,288 |
|
|
|
43,060 |
|
|
|
43,822 |
|
|
|
42,649 |
|
Weighted-average common shares outstanding - diluted |
|
|
45,541 |
|
|
|
43,737 |
|
|
|
44,878 |
|
|
|
43,495 |
|
|
|
|
|
|
|
|
|
|
|
AVID
TECHNOLOGY, INC. |
|
|
|
|
|
|
|
|
Reconciliations of GAAP Financial Measures to Non-GAAP
Financial Measures |
|
|
|
|
|
|
(unaudited -
in thousands) |
|
|
|
|
|
|
|
|
|
|
Three Months
Ended |
|
Twelve
Months Ended |
|
|
December 31, |
|
December 31, |
GAAP revenue |
|
|
2020 |
|
|
|
2019 |
|
|
|
2020 |
|
|
|
2019 |
|
GAAP
revenue |
|
$ |
104,301 |
|
|
$ |
116,306 |
|
|
$ |
360,466 |
|
|
$ |
411,788 |
|
|
|
|
|
|
|
|
|
|
Non-GAAP Gross Profit |
|
|
|
|
|
|
|
|
GAAP
gross profit |
|
|
65,350 |
|
|
|
73,273 |
|
|
|
228,320 |
|
|
|
249,075 |
|
Amortization
of intangible assets |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
3,738 |
|
Stock-based
compensation |
|
|
431 |
|
|
|
197 |
|
|
|
1,339 |
|
|
|
617 |
|
Non-GAAP Gross Profit |
|
$ |
65,781 |
|
|
$ |
73,470 |
|
|
$ |
229,659 |
|
|
$ |
253,430 |
|
Non-GAAP Gross Margin |
|
|
63.1 |
% |
|
|
63.2 |
% |
|
|
63.7 |
% |
|
|
61.5 |
% |
|
|
|
|
|
|
|
|
|
Non-GAAP Operating Expenses |
|
|
|
|
|
|
|
|
GAAP
operating expenses |
|
|
54,508 |
|
|
|
57,550 |
|
|
|
196,753 |
|
|
|
216,972 |
|
Less
Amortization of intangible assets |
|
|
(105 |
) |
|
|
- |
|
|
|
(411 |
) |
|
|
(695 |
) |
Less
Stock-based compensation |
|
|
(2,101 |
) |
|
|
(1,973 |
) |
|
|
(9,325 |
) |
|
|
(7,341 |
) |
Less
Restructuring costs, net |
|
|
(4,038 |
) |
|
|
(113 |
) |
|
|
(5,046 |
) |
|
|
(631 |
) |
Less
Restatement costs |
|
|
- |
|
|
|
15 |
|
|
|
- |
|
|
|
18 |
|
Less
Acquisition, integration and other costs |
|
|
(1,015 |
) |
|
|
(988 |
) |
|
|
(832 |
) |
|
|
(1,446 |
) |
Less
Efficiency program costs |
|
|
(886 |
) |
|
|
(59 |
) |
|
|
(1,331 |
) |
|
|
(250 |
) |
Less
COVID-19 related expenses |
|
|
(27 |
) |
|
|
- |
|
|
|
(278 |
) |
|
|
- |
|
Non-GAAP Operating Expenses |
|
$ |
46,336 |
|
|
$ |
54,432 |
|
|
$ |
179,530 |
|
|
$ |
206,627 |
|
|
|
|
|
|
|
|
|
|
Non-GAAP Operating Income |
|
|
|
|
|
|
|
|
GAAP
operating income |
|
|
10,842 |
|
|
|
15,723 |
|
|
|
31,567 |
|
|
|
32,103 |
|
Amortization
of intangible assets |
|
|
105 |
|
|
|
- |
|
|
|
411 |
|
|
|
4,433 |
|
Stock-based
compensation |
|
|
2,532 |
|
|
|
2,170 |
|
|
|
10,664 |
|
|
|
7,958 |
|
Restructuring costs, net |
|
|
4,038 |
|
|
|
113 |
|
|
|
5,046 |
|
|
|
631 |
|
Restatement
costs |
|
|
- |
|
|
|
(15 |
) |
|
|
- |
|
|
|
(18 |
) |
Acquisition,
integration and other costs |
|
|
1,015 |
|
|
|
988 |
|
|
|
832 |
|
|
|
1,446 |
|
Efficiency
program costs |
|
|
886 |
|
|
|
59 |
|
|
|
1,331 |
|
|
|
250 |
|
COVID-19
related expenses |
|
|
27 |
|
|
|
- |
|
|
|
278 |
|
|
|
- |
|
Non-GAAP Operating Income |
|
$ |
19,445 |
|
|
$ |
19,038 |
|
|
$ |
50,129 |
|
|
$ |
46,803 |
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA |
|
|
|
|
|
|
|
|
Non-GAAP Operating Income (from above) |
|
|
19,445 |
|
|
|
19,038 |
|
|
|
50,129 |
|
|
|
46,803 |
|
Depreciation |
|
|
2,188 |
|
|
|
2,166 |
|
|
|
8,505 |
|
|
|
9,202 |
|
Adjusted EBITDA |
|
$ |
21,633 |
|
|
$ |
21,204 |
|
|
$ |
58,634 |
|
|
$ |
56,005 |
|
Adjusted EBITDA Margin |
|
|
20.7 |
% |
|
|
18.2 |
% |
|
|
16.3 |
% |
|
|
13.6 |
% |
|
|
|
|
|
|
|
|
|
Non-GAAP Net Income |
|
|
|
|
|
|
|
|
Non-GAAP Operating Income (from above) |
|
|
19,445 |
|
|
|
19,038 |
|
|
|
50,129 |
|
|
|
46,803 |
|
Less
Non-GAAP Interest and other expense |
|
|
(3,929 |
) |
|
|
(5,584 |
) |
|
|
(19,133 |
) |
|
|
(22,207 |
) |
Less
Non-GAAP Income Tax |
|
|
(287 |
) |
|
|
(1,299 |
) |
|
|
(1,868 |
) |
|
|
(2,417 |
) |
Non-GAAP Net Income |
|
$ |
15,229 |
|
|
$ |
12,155 |
|
|
$ |
29,128 |
|
|
$ |
22,179 |
|
Weighted-average common shares outstanding -
basic |
|
|
44,288 |
|
|
|
43,060 |
|
|
|
43,822 |
|
|
|
42,649 |
|
Weighted-average common shares outstanding -
diluted |
|
|
45,541 |
|
|
|
43,737 |
|
|
|
44,878 |
|
|
|
43,495 |
|
Non-GAAP
Earnings Per Share - basic |
|
$ |
0.34 |
|
|
$ |
0.28 |
|
|
$ |
0.66 |
|
|
$ |
0.52 |
|
Non-GAAP
Earnings Per Share - diluted |
|
$ |
0.33 |
|
|
$ |
0.28 |
|
|
$ |
0.65 |
|
|
$ |
0.51 |
|
|
|
|
|
|
|
|
|
|
Free
Cash Flow |
|
|
|
|
|
|
|
|
GAAP
net cash (used in) provided by operating activities |
|
|
30,704 |
|
|
|
18,529 |
|
|
|
39,555 |
|
|
|
19,641 |
|
Capital
expenditures |
|
|
(73 |
) |
|
|
(1,556 |
) |
|
|
(5,692 |
) |
|
|
(7,185 |
) |
Free
Cash Flow |
|
$ |
30,631 |
|
|
$ |
16,973 |
|
|
$ |
33,863 |
|
|
$ |
12,456 |
|
Free
Cash Flow conversion of Adjusted EBITDA |
|
|
141.6 |
% |
|
|
80.0 |
% |
|
|
57.8 |
% |
|
|
22.2 |
% |
|
|
|
|
|
|
|
|
|
These non-GAAP
measures reflect how Avid manages its businesses internally.
Avid’s non-GAAP measures may vary from how other companies
present non-GAAP measures. Non-GAAP financial measures are not
based on a comprehensive set of accounting rules or principles.
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, or
GAAP. Non-GAAP financial measures should be considered in
addition to, not as a substitute for or superior to, financial
measures determined in accordance with GAAP. |
AVID
TECHNOLOGY, INC. |
|
|
|
|
Condensed Consolidated Balance Sheets |
|
|
|
|
(unaudited -
in thousands) |
|
|
|
|
|
|
|
|
|
|
|
December
31, |
|
December
31, |
|
|
|
2020 |
|
|
|
2019 |
|
ASSETS |
|
|
|
|
Current
assets: |
|
|
|
|
Cash and cash equivalents |
|
$ |
79,899 |
|
|
$ |
69,085 |
|
Restricted cash |
|
|
1,422 |
|
|
|
1,663 |
|
Accounts receivable, net of allowances of
$1,478 and $958 at December 31, 2020 and December 31, 2019,
respectively |
|
|
78,614 |
|
|
|
73,773 |
|
Inventories |
|
|
26,568 |
|
|
|
29,166 |
|
Prepaid expenses |
|
|
6,044 |
|
|
|
9,425 |
|
Contract assets |
|
|
18,579 |
|
|
|
19,494 |
|
Other current assets |
|
|
2,366 |
|
|
|
6,125 |
|
Total current assets |
|
|
213,492 |
|
|
|
208,731 |
|
|
|
|
|
|
Property and equipment, net |
|
|
16,814 |
|
|
|
19,580 |
|
Goodwill |
|
|
32,643 |
|
|
|
32,643 |
|
Right of use assets |
|
|
29,430 |
|
|
|
29,747 |
|
Deferred tax assets, net |
|
|
6,801 |
|
|
|
7,479 |
|
Other long-term assets |
|
|
5,958 |
|
|
|
6,113 |
|
Total assets |
|
$ |
305,138 |
|
|
$ |
304,293 |
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' DEFICIT |
|
|
|
|
Current
liabilities: |
|
|
|
|
Accounts payable |
|
$ |
21,823 |
|
|
$ |
39,888 |
|
Accrued compensation and benefits |
|
|
29,105 |
|
|
|
19,524 |
|
Accrued expenses and other current
liabilities |
|
|
42,264 |
|
|
|
36,759 |
|
Income taxes payable |
|
|
1,664 |
|
|
|
1,945 |
|
Short-term debt |
|
|
4,941 |
|
|
|
30,554 |
|
Deferred revenues |
|
|
87,974 |
|
|
|
83,589 |
|
Total current
liabilities |
|
|
187,771 |
|
|
|
212,259 |
|
|
|
|
|
|
Long-term debt |
|
|
202,759 |
|
|
|
199,034 |
|
Long-term deferred revenues |
|
|
11,284 |
|
|
|
14,312 |
|
Long-term lease liabilities |
|
|
28,462 |
|
|
|
28,127 |
|
Other long-term liabilities |
|
|
7,786 |
|
|
|
5,646 |
|
Total liabilities |
|
|
438,062 |
|
|
|
459,378 |
|
|
|
|
|
|
Stockholders' deficit: |
|
|
|
|
Common stock |
|
|
442 |
|
|
|
430 |
|
Additional paid-in capital |
|
|
1,036,658 |
|
|
|
1,027,824 |
|
Accumulated deficit |
|
|
(1,168,347 |
) |
|
|
(1,179,409 |
) |
Accumulated other comprehensive loss |
|
|
(1,677 |
) |
|
|
(3,930 |
) |
Total stockholders'
deficit |
|
|
(132,924 |
) |
|
|
(155,085 |
) |
Total liabilities and
stockholders' deficit |
|
$ |
305,138 |
|
|
$ |
304,293 |
|
|
|
|
|
|
AVID TECHNOLOGY, INC. |
|
|
|
Condensed Consolidated Statements of Cash
Flows |
|
|
|
(unaudited - in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve
Months Ended |
|
|
|
|
|
December 31, |
|
|
|
|
|
|
2020 |
|
|
|
2019 |
|
|
|
|
|
|
|
|
|
Cash flows from operating activities: |
|
|
|
|
Net income |
$ |
11,062 |
|
|
$ |
7,601 |
|
|
Adjustments to reconcile net income to net cash provided by
operating activities: |
|
|
|
|
|
Depreciation and amortization |
|
8,505 |
|
|
|
13,634 |
|
|
|
Provision for doubtful accounts |
|
1,298 |
|
|
|
208 |
|
|
|
Stock-based compensation expense |
|
10,664 |
|
|
|
7,958 |
|
|
|
Non-cash provision for restructuring |
|
5,046 |
|
|
|
- |
|
|
|
Non-cash interest expense |
|
3,651 |
|
|
|
6,143 |
|
|
|
Loss on extinguishment of debt |
|
- |
|
|
|
2,878 |
|
|
|
Unrealized foreign currency transaction loss |
|
1,570 |
|
|
|
971 |
|
|
|
Benefit from (provision for) deferred taxes |
|
827 |
|
|
|
(6,309 |
) |
|
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
Accounts receivable |
|
(6,124 |
) |
|
|
(6,227 |
) |
|
|
|
Inventories |
|
2,598 |
|
|
|
3,790 |
|
|
|
|
Prepaid expenses and other assets |
|
6,176 |
|
|
|
(44 |
) |
|
|
|
Accounts payable |
|
(18,141 |
) |
|
|
626 |
|
|
|
|
Accrued expenses, compensation and benefits and other
liabilities |
|
10,432 |
|
|
|
(6,892 |
) |
|
|
|
Income taxes payable |
|
(281 |
) |
|
|
91 |
|
|
|
|
Deferred revenue and contract assets |
|
2,272 |
|
|
|
(4,787 |
) |
Net cash provided by operating activities |
|
39,555 |
|
|
|
19,641 |
|
|
|
|
|
|
|
|
|
Cash flows from investing activities: |
|
|
|
|
Purchases of property and equipment |
|
(5,692 |
) |
|
|
(7,185 |
) |
Net cash used in investing activities |
|
(5,692 |
) |
|
|
(7,185 |
) |
|
|
|
|
|
|
|
|
Cash flows from financing activities: |
|
|
|
|
Proceeds from revolving line of credit |
|
22,000 |
|
|
|
- |
|
|
Repayment on revolving line of credit |
|
(22,000 |
) |
|
|
- |
|
|
Proceeds from long-term debt |
|
7,800 |
|
|
|
79,292 |
|
|
Repayment of debt |
|
(2,250 |
) |
|
|
(1,438 |
) |
|
Payments for repurchase of outstanding Notes |
|
(28,867 |
) |
|
|
(76,269 |
) |
|
Proceeds from the issuance of common stock under employee stock
plans |
|
547 |
|
|
|
309 |
|
|
Common stock repurchases for tax withholdings for net settlement of
equity awards |
|
(2,365 |
) |
|
|
(3,586 |
) |
|
Partial Unwind capped call cash receipt |
|
875 |
|
|
|
27 |
|
|
Payments for credit facility issuance costs |
|
(289 |
) |
|
|
(5,979 |
) |
Net cash used in financing activities |
|
(24,549 |
) |
|
|
(7,644 |
) |
|
|
|
|
|
|
|
|
Effect of exchange rate changes on cash, cash equivalents, and
restricted cash |
|
1,748 |
|
|
|
(331 |
) |
Net decrease in cash, cash equivalents, and restricted cash |
|
11,062 |
|
|
|
4,481 |
|
Cash, cash equivalents and restricted cash at beginning of the
period |
|
72,575 |
|
|
|
68,094 |
|
Cash, cash equivalents and restricted cash at end of the
period |
$ |
83,637 |
|
|
|
|
$ |
72,575 |
|
Supplemental information: |
|
|
|
Cash and cash equivalents |
$ |
79,899 |
|
|
$ |
69,085 |
|
Restricted cash |
|
1,422 |
|
|
|
1,663 |
|
Restricted cash included in other long-term assets |
|
2,316 |
|
|
|
1,827 |
|
Total cash, cash equivalents and restricted cash shown in the
statement of cash flows |
$ |
83,637 |
|
|
$ |
72,575 |
|
|
|
|
|
|
|
|
|
|
|
AVID
TECHNOLOGY, INC. |
|
Supplemental Revenue Information |
|
|
|
|
(unaudited - in millions) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dec 31, |
|
Sep 30, |
|
Dec 31, |
|
|
|
|
|
|
2020 |
|
2020 |
|
2019 |
|
|
|
|
|
Revenue Backlog* |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred
Revenue |
$ 99.3 |
|
$ 81.2 |
|
$ 97.9 |
|
|
|
|
|
Other
Backlog |
336.2 |
|
321.7 |
|
342.3 |
|
|
|
|
|
Total
Revenue Backlog |
$ 435.5 |
|
$ 402.9 |
|
$ 440.2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The expected timing of recognition of revenue backlog as of
December 31, 2020 is as follows: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2021 |
|
2022 |
|
2023 |
|
Thereafter |
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
Deferred Revenue |
$ 88.0 |
|
$ 6.9 |
|
$ 2.5 |
|
$ 1.9 |
|
$ 99.3 |
|
Other Backlog |
143.3 |
|
99.9 |
|
65.5 |
|
27.5 |
|
$ 336.2 |
|
Total Revenue Backlog |
$ 231.3 |
|
$ 106.8 |
|
$ 68.0 |
|
$ 29.4 |
|
$ 435.5 |
|
|
|
|
|
|
|
|
|
|
|
|
*A definition of
Revenue Backlog is included in our Form 10-K and the supplemental
financial and operational data sheet available on our investor
relations webpage at ir.avid.com. |
|
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