Synchronoss Technologies Inc. (NASDAQ: SNCR), a global leader and
innovator in cloud, messaging, digital and IoT platforms and
products, today announced financial results for its third quarter
ended September 30, 2019.
Glenn Lurie, president and chief executive
officer, stated, “Thus far, 2019 has been an extremely active year
for Synchronoss and our platforms are executing well with new
customers, new partners and revenue in each. We have announced
partnerships with leading companies in the TMT industry such as
Amazon, AT&T, BT, Microsoft, Rackspace and others embracing
Synchronoss solutions to accelerate revenue growth, reduce costs,
and accelerate digital transformations. Many of these partnerships
are success-based revenue-share models that are expected to drive
meaningful and material revenue for the company in 2020 and
beyond.”
Lurie added, “We are very excited to announce
our third new cloud deal of the year, this time with a major
U.S.-based Tier 1 carrier. This new customer, along with our
previously announced new cloud deals, demonstrate that the
Synchronoss white-label cloud is in the sweet spot of what carriers
need as they prepare for the widespread launch of 5G cellular and
continue to seek out new sources of revenue and profitability.”
David Clark, Chief Financial Officer, stated,
“As Sequential Technology International (STI) is evaluating
strategic alternatives, based on this process we have decided to
take a more conservative approach to our financial relationship. As
a result, in the third quarter, we wrote off $26 million of
STI-related accounts receivable which are now deemed uncollectible.
This revenue relationship with STI falls under the new lease
accounting standards, so the write-down is accounted for as a
cumulative adjustment to revenue recognized in 2018 and 2019, and
as such reduces third-quarter GAAP revenue from $78.2 million to
$52.2 million. Going forward, quarterly revenue from STI will be
recognized based on the amount of cash we collect in payment for
our services, currently estimated to be in the range of $2.5-$3.0
million per quarter. We believe this will enable Synchronoss
management and our investors to focus on the future of the company;
in particular, execution and delivery of the transactions we have
announced this year. Before the STI prior period revenue
adjustment, operationally we were trending toward our original
revenue and EBITDA guidance for the year.”
Third quarter highlights:
- Excluding the non-recurring STI revenue write-down,
revenue for the quarter would have been $78.2 million. The non-cash
$26.0 million write-down of STI’s accounts receivable balance,
which is accounted for as a cumulative adjustment to prior revenue
under the new lease accounting standards, resulted in GAAP revenue
totaling $52.2 million.
- GAAP net loss for the quarter, which includes the $26
million STI write-down, was $69.4 million, or $1.70 per share,
compared to $54.5 million or $1.38 per share in the prior year’s
third quarter. Excluding the STI write-down, Non-GAAP net loss
attributable to Synchronoss was $25.3 million or 62 cents per
share, compared to $33.5 million in the year-ago quarter or 84
cents per share.
- Synchronoss delivered $5.8 million of adjusted EBITDA,
compared to $9.4 million in the third quarter of
2018.
Three Months Ended September 30, |
$000s |
2019 |
2018 |
% Change |
Revenues |
$ |
52,210 |
|
$ |
83,286 |
|
(37.3 |
)% |
Non-GAAP Revenue Excluding STI
Write-Down |
78,210 |
|
83,286 |
|
(6.0 |
)% |
Net Loss |
(69,432 |
) |
(54,529 |
) |
(27.3 |
)% |
Non-GAAP Net Loss From Cont.
Ops. Attributable to Synchronoss |
(25,361 |
) |
(33,457 |
) |
24.2 |
% |
Adjusted EBITDA |
5,799 |
|
9,360 |
|
(38.0 |
)% |
Nine Months Ended September 30, |
|
$000s |
2019 |
2018 |
% Change |
|
Revenues |
$ |
218,161 |
|
$ |
243,737 |
|
|
(10.5 |
)% |
Non-GAAP Revenue Excluding STI
Write-Down |
|
|
244,161 |
|
|
243,737 |
|
|
0.2 |
% |
Net Loss |
(122,049 |
) |
(141,839 |
) |
|
14.0 |
% |
Non-GAAP Net Loss From Cont.
Ops. Attributable to Synchronoss |
|
|
(51,276 |
) |
|
(75,005 |
) |
|
31.6 |
% |
Adjusted EBITDA |
21,098 |
|
(1,413 |
) |
NM |
|
New Business Update
New customer agreements and partnerships that
the company has completed since the last earnings announcement
include:
- The new major U.S.-based Tier 1 cloud customer announced today,
that is expected to launch the Synchronoss white label cloud
service in 2020.
- A partnership with Accruent, the world’s leading provider of
physical resource management solutions, to combine Synchronoss’
expertise in smart building analytics with Accruent’s asset
monitoring system. The collaboration will deliver valuable insights
and efficiencies to enterprises, across facilities, and greatly
expand the effectiveness of enterprise IoT solutions.
- A letter of intent with CityFM to combine their expertise in
facility management engineering with Synchronoss’ expertise in
software analytics to create an end-to-end IoT facility management
offering which is scalable and is expected to drive greater
efficiencies.
- Indosat Ooredoo, a leading telecom service provider in
Indonesia, has chosen the Synchronoss Digital Experience Platform
(DXP) to deliver a unified, interconnected user experience for
customers across all of its engagement channels. The Synchronoss
platform will also support Indosat Ooredoo’s “future digital
economy ecosystem” project, a nationwide initiative to encourage
collaboration and develop new ideas, products and use cases
involving IoT technology to help drive economic growth.
- British American Tobacco (BAT) is launching a multi-country
pilot of the Synchronoss Digital Experience Platform across 25 of
its 2,000 retail locations in Europe. The Synchronoss DXP solution
will provide BAT with the ability to quickly design, deploy, manage
and optimize customer journeys while providing a unified experience
across all its owned retail locations. This is Synchronoss’ first
DXP deployment outside of its traditional TMT customer base and is
expected to provide a powerful proof case for traditional brick and
mortar retailers.
- The first live deployments using Synchronoss DXP with Amazon
are underway with carriers in Singapore and Mexico. These carriers
are in the process of being integrated with Amazon and are expected
to begin offering Amazon services in the fourth quarter. Three
other Amazon deployments are under way and we anticipate a number
of larger deployments in 2020 and beyond.
- Rackspace has signed a three-year agreement to deploy the
Synchronoss Smart Building solution at five of its facilities in
North America, including “The Castle,” Rackspace’s 1.2 million
square foot global headquarters in San Antonio, Texas.
- In addition, Rackspace has licensed the company’s Financial
Analytics platform to manage costs and provide visibility and
deliver savings by checking and validating the accuracy of its
largest and most complex third-party partner expenses and
invoices.
A reconciliation of GAAP to non-GAAP results has
been provided in the financial statement tables included in this
press release. An explanation of these measures is included below
under the heading "Non-GAAP Financial Measures."
Conference Call Details
Synchronoss will host a conference call on
Monday, November 4, 2019, at 5:00 p.m. (ET) to discuss the
company’s financial results. To access this call, dial
1-201-493-6784. Additionally, a live web cast of the conference
call will be available on the Investor Relations page on the
company’s web site at www.synchronoss.com.
Following the conference call, a replay will be
available for a limited time at 1-412-317-6671. The replay pass
code is 13695428. An archived web cast of this conference call will
also be available on the Investor Relations page of the company’s
web site, www.synchronoss.com.
Non-GAAP Financial Measures
Synchronoss has provided in this release
selected financial information that has not been prepared in
accordance with GAAP. This information includes historical non-GAAP
revenues, gross profit, operating income (loss), net income (loss),
effective tax rate, earnings (loss) per share and cash flows from
operating activities. Synchronoss uses these non-GAAP financial
measures internally in analyzing its financial results and believes
they are useful to investors, as a supplement to GAAP measures, in
evaluating Synchronoss’ ongoing operational performance.
Synchronoss believes that the use of these non-GAAP financial
measures provides an additional tool for investors to use in
evaluating ongoing operating results and trends, and in comparing
its financial results with other companies in Synchronoss’
industry, many of which present similar non-GAAP financial measures
to investors. As noted, the non-GAAP financial results discussed
above add back fair value stock-based compensation expense,
acquisition-related costs which includes integration costs,
restructuring and cease-use lease expense, deferred compensation
expense related to earn outs and amortization of intangibles
associated with acquisitions as well as certain non-recurring
adjustments.
Non-GAAP financial measures should not be
considered in isolation from, or as a substitute for, financial
information prepared in accordance with GAAP. Investors are
encouraged to review the reconciliation of these non-GAAP measures
to their most directly comparable GAAP financial measures as
detailed above. As previously mentioned, a reconciliation of GAAP
to non-GAAP results has been provided in the financial statement
tables included in this press release.
About Synchronoss Technologies,
Inc.
Synchronoss transforms the way companies create
new revenue, reduce costs and delight their subscribers with cloud,
messaging, digital and IoT products, supporting hundreds of
millions of subscribers across the globe. Synchronoss’ secure,
scalable and groundbreaking new technologies, trusted partnerships,
and talented people change the way TMT customers grow their
businesses. For more information, visit us at
www.synchronoss.com.
Forward-looking Statements
This press release includes statements
concerning Synchronoss and its future expectations, plans and
prospects that constitute “forward-looking statements” within the
meaning of the Private Securities Litigation Reform Act of 1995.
For this purpose, any statements contained herein that are not
statements of historical fact may be deemed to be forward-looking
statements. Without limiting the foregoing, the words “may,”
“should,” “expects,” “plans,” “anticipates,” “could,” “intends,”
“believes,” “potential” or “continue” or other similar expressions
are intended to identify forward-looking statements. Synchronoss
has based these forward-looking statements largely on its current
expectations and projections about future events and financial
trends that it believes may affect its business, financial
condition and results of operations. These forward-looking
statements speak only as of the date of this press release and are
subject to a number of risks, uncertainties and assumptions
including, without limitation, risks relating to the Company’s
ability to sustain or increase revenue from its larger customers
and generate revenue from new customers, the Company’s expectations
regarding expenses and revenue, the sufficiency of the Company’s
cash resources and its ability to satisfy or refinance its existing
debt obligations, the Company’s growth strategies, the anticipated
trends and challenges in the business and the market in which the
Company operates, the Company’s expectations regarding federal,
state and foreign regulatory requirements, the pending lawsuits
against the Company described in its most recent SEC filings, and
other risks and factors that are described in the “Risk Factors”
and “Management’s Discussion and Analysis of Financial Condition
and Results of Operations” sections of the Company’s Annual Report
on Form 10-K for the year ended December 31, 2018, which is on file
with the SEC and available on the SEC’s website at www.sec.gov. The
company does not undertake any obligation to update any
forward-looking statements contained in this press release as a
result of new information, future events or otherwise.
Contact:
Investors:Joe Crivelli, Vice President, Investor
Relations908-566-3131investor@synchronoss.com
Media:
CCgroupUS: Diane Rose, +1 727-238-7567 or International: Anais
Merlin, +44 20 3824
9219
synchronoss@ccgrouppr.com
SYNCHRONOSS
TECHNOLOGIES, INC.CONDENSED CONSOLIDATED
BALANCE SHEETS(Unaudited) (In
thousands)
|
|
September 30, 2019 |
|
December 31, 2018 |
ASSETS |
|
|
|
|
Current assets: |
|
|
|
|
Cash and cash equivalents |
|
$ |
19,193 |
|
|
$ |
103,771 |
|
Restricted cash |
|
21 |
|
|
6,089 |
|
Marketable securities, current |
|
897 |
|
|
28,230 |
|
Accounts receivable, net of allowances for bad debt of $3,318 and
$4,599 at September 30, 2019 and December 31, 2018,
respectively |
|
73,574 |
|
|
102,798 |
|
Prepaid expenses |
|
17,096 |
|
|
45,058 |
|
Other current assets |
|
4,934 |
|
|
8,508 |
|
Total current assets |
|
115,715 |
|
|
294,454 |
|
Restricted cash |
|
|
|
|
Marketable securities, non-current |
|
— |
|
|
6,658 |
|
Property and equipment, net |
|
35,631 |
|
|
67,937 |
|
Operating lease right-of-use assets |
|
55,308 |
|
|
— |
|
Goodwill |
|
220,367 |
|
|
224,899 |
|
Intangible assets, net |
|
81,172 |
|
|
98,706 |
|
Other assets |
|
7,769 |
|
|
8,982 |
|
Equity method investment |
|
— |
|
|
1,619 |
|
Total assets |
|
$ |
515,962 |
|
|
$ |
703,255 |
|
LIABILITIES AND STOCKHOLDERS’
EQUITY |
|
|
|
|
Current liabilities: |
|
|
|
|
Accounts payable |
|
$ |
15,496 |
|
|
$ |
13,576 |
|
Accrued expenses |
|
54,219 |
|
|
59,545 |
|
Deferred revenues, current |
|
53,789 |
|
|
57,101 |
|
Short-term convertible debt, net of debt issuance costs |
|
— |
|
|
113,542 |
|
Mandatorily redeemable financial instrument |
|
— |
|
|
— |
|
Total current liabilities |
|
123,504 |
|
|
243,764 |
|
Lease financing obligation |
|
— |
|
|
9,494 |
|
Operating lease liabilities, non-current |
|
62,863 |
|
|
— |
|
Long-term convertible debt, net of debt issuance costs |
|
— |
|
|
— |
|
Deferred tax liabilities |
|
1,270 |
|
|
1,347 |
|
Deferred revenues, non-current |
|
34,018 |
|
|
59,841 |
|
Other non-current liabilities |
|
4,624 |
|
|
10,797 |
|
Redeemable noncontrolling interest |
|
12,500 |
|
|
12,500 |
|
Commitments and
contingencies |
|
|
|
|
Series A Convertible Participating Perpetual Preferred Stock,
$0.0001 par value; 10,000 shares authorized; 210 shares issued and
outstanding at September 30, 2019 |
|
192,596 |
|
|
176,603 |
|
Stockholders’ equity: |
|
|
|
|
Common stock, $0.0001 par value; 100,000 shares authorized, 51,608
and 49,836 shares issued; 44,446 and 42,674 outstanding at
September 30, 2019 and December 31, 2018, respectively |
|
5 |
|
|
5 |
|
Treasury stock, at cost (7,162 and 7,162 shares at September 30,
2019 and December 31, 2018, respectively) |
|
(82,087 |
) |
|
(82,087 |
) |
Additional paid-in capital |
|
528,734 |
|
|
534,673 |
|
Accumulated other comprehensive loss |
|
(33,880 |
) |
|
(30,383 |
) |
Accumulated deficit |
|
(328,185 |
) |
|
(233,299 |
) |
Total stockholders’
equity |
|
84,587 |
|
|
188,909 |
|
Total liabilities and
stockholders’ equity |
|
$ |
515,962 |
|
|
$ |
703,255 |
|
SYNCHRONOSS
TECHNOLOGIES, INC.CONDENSED CONSOLIDATED
STATEMENTS OF
OPERATIONS(Unaudited)(In
thousands, except per share data)
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|
|
|
|
|
|
|
|
Net revenues |
$ |
52,210 |
|
|
$ |
83,286 |
|
|
|
$ |
218,161 |
|
|
$ |
243,737 |
|
Costs and expenses: |
|
|
|
|
|
|
|
Cost of revenues |
35,602 |
|
|
43,714 |
|
|
|
107,958 |
|
|
127,788 |
|
Research and development |
18,575 |
|
|
18,684 |
|
|
|
57,282 |
|
|
59,789 |
|
Selling, general and administrative |
30,536 |
|
|
27,320 |
|
|
|
82,862 |
|
|
99,368 |
|
Restructuring charges |
(39 |
) |
|
4,539 |
|
|
|
738 |
|
|
8,425 |
|
Depreciation and amortization |
18,508 |
|
|
23,658 |
|
|
|
58,920 |
|
|
70,330 |
|
Total costs and expenses |
103,182 |
|
|
117,915 |
|
|
307,760 |
|
|
365,700 |
|
Loss from continuing
operations |
(50,972 |
) |
|
(34,629 |
) |
|
(89,599 |
) |
|
(121,963 |
) |
Interest income |
228 |
|
|
203 |
|
|
716 |
|
|
7,518 |
|
Interest expense |
(203 |
) |
|
(1,370 |
) |
|
(1,251 |
) |
|
(3,935 |
) |
Gain on extinguishment of debt |
5 |
|
|
— |
|
|
822 |
|
|
— |
|
Other (expense) income, net |
(422 |
) |
|
(13,439 |
) |
|
17 |
|
|
(9,180 |
) |
Equity method investment (loss) income |
— |
|
|
283 |
|
|
(1,619 |
) |
|
71 |
|
Loss from continuing
operations, before taxes |
(51,364 |
) |
|
(48,952 |
) |
|
(90,914 |
) |
|
(127,489 |
) |
(Provision) benefit for income taxes |
(9,849 |
) |
|
2,308 |
|
|
(6,614 |
) |
|
1,604 |
|
Net loss |
(61,213 |
) |
|
(46,644 |
) |
|
(97,528 |
) |
|
(125,885 |
) |
Net loss attributable to redeemable noncontrolling interests |
(25 |
) |
|
(422 |
) |
|
(931 |
) |
|
2,122 |
|
Preferred stock dividend |
(8,194 |
) |
|
(7,463 |
) |
|
(23,590 |
) |
|
(18,076 |
) |
Net loss attributable to
Synchronoss |
$ |
(69,432 |
) |
|
$ |
(54,529 |
) |
|
$ |
(122,049 |
) |
|
$ |
(141,839 |
) |
|
|
|
|
|
|
|
|
Earnings per
share: |
|
|
|
|
|
|
|
Basic |
$ |
(1.70 |
) |
|
$ |
(1.38 |
) |
|
$ |
(3.01 |
) |
|
$ |
(3.51 |
) |
Diluted |
$ |
(1.70 |
) |
|
$ |
(1.38 |
) |
|
$ |
(3.01 |
) |
|
$ |
(3.51 |
) |
Weighted-average
common shares outstanding: |
|
|
|
|
|
|
|
Basic |
40,910 |
|
|
39,612 |
|
|
40,564 |
|
|
40,405 |
|
Diluted |
40,910 |
|
|
39,612 |
|
|
40,564 |
|
|
40,405 |
|
SYNCHRONOSS
TECHNOLOGIES, INC.CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS (In thousands)
(Unaudited)
|
Nine Months Ended September 30, |
|
2019 |
|
2018 |
Operating
activities: |
|
|
|
Net loss |
$ |
(97,528 |
) |
|
$ |
(125,885 |
) |
Adjustments to reconcile Net
Loss to net cash used in operating activities: |
|
|
|
Depreciation and amortization |
58,921 |
|
|
70,330 |
|
Change in fair value of financial instruments |
— |
|
|
(3,849 |
) |
Amortization of debt issuance costs |
272 |
|
|
1,060 |
|
(Gain) loss on extinguishment of debt |
(822 |
) |
|
— |
|
Accrued PIK interest* |
— |
|
|
(7,037 |
) |
Allowance for loan losses* |
— |
|
|
18,225 |
|
(Earnings) loss from equity method investments* |
1,619 |
|
|
(71 |
) |
Loss (Gain) on disposals |
15 |
|
|
277 |
|
Amortization of bond premium |
(34 |
) |
|
75 |
|
Deferred income taxes |
(25 |
) |
|
(1,648 |
) |
|
|
|
|
|
|
Stock-based compensation |
17,033 |
|
|
22,040 |
|
Cumulative adjustment to STI receivable |
26,044 |
|
|
— |
|
ROU Asset Impairment |
6,268 |
|
|
— |
|
Changes in operating assets
and liabilities: |
|
|
|
Accounts receivable, net of allowance for doubtful accounts |
3,180 |
|
|
28,789 |
|
Prepaid expenses and other current assets |
34,052 |
|
|
(12,844 |
) |
Other assets |
1,966 |
|
|
947 |
|
Accounts payable |
2,615 |
|
|
8,195 |
|
Accrued expenses |
(9,418 |
) |
|
(24,539 |
) |
Other liabilities |
(3,736 |
) |
|
(3,886 |
) |
|
|
|
|
|
|
Deferred revenues |
(28,583 |
) |
|
(30,841 |
) |
Net cash provided by (used
for) operating activities |
11,839 |
|
|
(60,662 |
) |
Investing
activities: |
|
|
|
Purchases of property and equipment |
(7,077 |
) |
|
(8,565 |
) |
Purchases of capitalized software |
(9,289 |
) |
|
(11,012 |
) |
Purchases of marketable securities available for sale |
(47,703 |
) |
|
(15,784 |
) |
Maturity of marketable securities available for sale |
81,794 |
|
|
3,050 |
|
Business acquired, net of cash |
— |
|
|
(9,734 |
) |
Net cash used for investing
activities |
17,725 |
|
|
(42,045 |
) |
Financing
activities: |
|
|
|
Extinguishment of outstanding Convertible Senior Notes |
(112,993 |
) |
|
— |
|
Proceeds from issuance of preferred stock |
— |
|
|
86,220 |
|
Preferred dividend payment |
(7,075 |
) |
|
— |
|
Payments for finance leases |
(925 |
) |
|
(1,018 |
) |
Net cash (used for) provided
by financing activities |
(120,993 |
) |
|
85,202 |
|
Effect of exchange rate changes on cash |
783 |
|
|
(1,805 |
) |
Net decrease in cash,
restricted cash and cash equivalents |
(90,646 |
) |
|
(19,310 |
) |
Cash, restricted cash
and cash equivalents, beginning of period |
109,860 |
|
|
246,125 |
|
Cash, restricted cash
and cash equivalents, end of period |
$ |
19,214 |
|
|
$ |
226,815 |
|
SYNCHRONOSS
TECHNOLOGIES, INC.RECONCILIATION OF GAAP TO
NON-GAAP FINANCIAL MEASURES(In thousands, except
per share data)(Unaudited)
|
|
Three Months Ended Sep 30, |
|
Nine Months Ended Sep 30, |
|
|
2019 |
|
2018 |
|
2019 |
|
2018 |
Non-GAAP financial
measures and reconciliation: |
|
|
|
|
|
|
|
|
GAAP
Revenue |
|
$ |
52,210 |
|
|
$ |
83,286 |
|
|
$ |
218,161 |
|
|
$ |
243,737 |
|
Less: Cost of revenues |
|
35,602 |
|
|
43,714 |
|
|
107,958 |
|
|
127,788 |
|
Gross
Profit |
|
16,608 |
|
|
39,572 |
|
|
110,203 |
|
|
115,949 |
|
Add /
(Less): |
|
|
|
|
|
|
|
|
Stock-based compensation expense |
|
803 |
|
|
1,035 |
|
|
2,147 |
|
|
3,447 |
|
Restructuring and cease-use lease expense |
|
141 |
|
|
— |
|
|
405 |
|
|
— |
|
Cumulative adjustment to STI receivable |
|
26,044 |
|
|
|
|
26,044 |
|
|
|
Adjusted Gross
Profit |
|
$ |
43,596 |
|
|
$ |
40,607 |
|
|
$ |
138,799 |
|
|
$ |
119,396 |
|
Adjusted Gross
Margin |
|
83.5 |
% |
|
48.8 |
% |
|
63.6 |
% |
|
49.0 |
% |
|
|
|
|
|
|
|
|
|
GAAP loss from
continuing operations |
|
(50,972 |
) |
|
(34,629 |
) |
|
(89,599 |
) |
|
(121,963 |
) |
Add /
(Less): |
|
|
|
|
|
|
|
|
Stock-based compensation expense |
|
6,000 |
|
|
7,216 |
|
|
17,028 |
|
|
22,038 |
|
Acquisition costs |
|
— |
|
|
38 |
|
|
(230 |
) |
|
149 |
|
Restructuring and cease-use lease expense |
|
6,215 |
|
|
4,539 |
|
|
7,429 |
|
|
8,425 |
|
Amortization expense |
|
5,808 |
|
|
8,472 |
|
|
19,072 |
|
|
25,122 |
|
Cumulative adjustment to STI receivable |
|
26,044 |
|
|
— |
|
|
26,044 |
|
|
— |
|
One-Time Expenses due to Restatement, etc. |
|
4 |
|
|
3,638 |
|
|
1,506 |
|
|
19,608 |
|
Non-GAAP loss from
continuing operations |
|
$ |
(6,901 |
) |
|
$ |
(10,726 |
) |
|
$ |
(18,750 |
) |
|
$ |
(46,621 |
) |
|
|
|
|
|
|
|
|
|
GAAP Net loss
attributable to Synchronoss |
|
$ |
(69,432 |
) |
|
$ |
(54,529 |
) |
|
$ |
(122,049 |
) |
|
$ |
(141,839 |
) |
Add /
(Less): |
|
|
|
|
|
|
|
|
Stock-based compensation expense |
|
6,000 |
|
|
7,216 |
|
|
17,028 |
|
|
22,038 |
|
Acquisition costs |
|
— |
|
|
38 |
|
|
(230 |
) |
|
149 |
|
Restructuring and cease-use lease expense |
|
6,215 |
|
|
4,539 |
|
|
7,429 |
|
|
8,425 |
|
Amortization expense |
|
5,808 |
|
|
8,472 |
|
|
19,072 |
|
|
25,122 |
|
Non-GAAP Expenses attributable to Non-Controlling Interest |
|
— |
|
|
(523 |
) |
|
(76 |
) |
|
(1,269 |
) |
One-Time Expenses due to Restatement, etc. |
|
4 |
|
|
3,638 |
|
|
1,506 |
|
|
19,608 |
|
Cumulative adjustment to STI receivable |
|
26,044 |
|
|
— |
|
|
26,044 |
|
|
— |
|
Income Tax Effect at Statutory Tax Rates |
|
— |
|
|
(2,308 |
) |
|
— |
|
|
(7,239 |
) |
Non-GAAP Net loss from
continuing operations attributable to Synchronoss |
|
$ |
(25,361 |
) |
|
$ |
(33,457 |
) |
|
$ |
(51,276 |
) |
|
$ |
(75,005 |
) |
|
|
|
|
|
|
|
|
|
Diluted Non-GAAP Net loss from
continuing operations per share |
|
$ |
(0.62 |
) |
|
$ |
(0.84 |
) |
|
$ |
(1.26 |
) |
|
$ |
(1.86 |
) |
|
|
|
|
|
|
|
|
|
Weighted shares outstanding -
Basic |
|
40,910 |
|
|
39,612 |
|
|
40,564 |
|
|
40,405 |
|
SYNCHRONOSS
TECHNOLOGIES, INC.RECONCILIATION OF GAAP TO
NON-GAAP FINANCIAL MEASURES(In thousands, except
per share data)(Unaudited)
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
Sep 30, 2018 |
|
Dec 31, 2018 |
|
Mar 31, 2019 |
|
Jun 30, 2019 |
|
Sep 30, 2019 |
|
Sep 30, 2019 |
|
Sep 30, 2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income
attributable to Synchronoss |
|
$ |
(54,529 |
) |
|
$ |
(101,909 |
) |
|
$ |
(27,587 |
) |
|
$ |
(25,030 |
) |
|
$ |
(69,432 |
) |
|
$ |
(122,049 |
) |
|
$ |
(141,839 |
) |
Add /
(Less): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring and cease-use lease expense |
|
4,539 |
|
|
3,950 |
|
|
740 |
|
|
474 |
|
|
6,215 |
|
|
7,429 |
|
|
8,425 |
|
Net change in contingent consideration obligation |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Depreciation and amortization |
|
23,658 |
|
|
47,324 |
|
|
20,143 |
|
|
20,269 |
|
|
18,508 |
|
|
58,920 |
|
|
70,330 |
|
Interest income |
|
(203 |
) |
|
(252 |
) |
|
(189 |
) |
|
(299 |
) |
|
( 228 |
) |
|
(716 |
) |
|
(7,518 |
) |
Interest Expense |
|
1,370 |
|
|
976 |
|
|
585 |
|
|
463 |
|
|
203 |
|
|
1,251 |
|
|
3,935 |
|
Gain on Extinguishment of debt |
|
— |
|
|
(1,760 |
) |
|
(387 |
) |
|
(430 |
) |
|
( 5 |
) |
|
(822 |
) |
|
— |
|
Other Income (expense), net |
|
13,439 |
|
|
65,737 |
|
|
(463 |
) |
|
24 |
|
|
422 |
|
|
(17 |
) |
|
9,180 |
|
Equity method investment income (loss), net |
|
(283 |
) |
|
28,671 |
|
|
1,243 |
|
|
376 |
|
|
— |
|
|
1,619 |
|
|
(71 |
) |
Benefit for income taxes |
|
(2,308 |
) |
|
(16,290 |
) |
|
(1,391 |
) |
|
(1,844 |
) |
|
9,849 |
|
|
6,614 |
|
|
(1,604 |
) |
Net (loss) income attributable to noncontrolling interests |
|
422 |
|
|
(6,715 |
) |
|
313 |
|
|
593 |
|
|
25 |
|
|
931 |
|
|
(2,122 |
) |
Preferred dividend |
|
7,463 |
|
|
7,517 |
|
|
7,537 |
|
|
7,859 |
|
|
8,194 |
|
|
23,590 |
|
|
18,076 |
|
Stock-based compensation expense |
|
7,216 |
|
|
5,566 |
|
|
5,554 |
|
|
5,474 |
|
|
6,000 |
|
|
17,028 |
|
|
22,038 |
|
Acquisition costs |
|
38 |
|
|
109 |
|
|
(188 |
) |
|
(42 |
) |
|
— |
|
|
(230 |
) |
|
149 |
|
Integration |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Cumulative adjustment to STI receivable |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
26,044 |
|
|
26,044 |
|
|
— |
|
One-Time Expenses due to Restatement, etc. |
|
3,638 |
|
|
800 |
|
|
720 |
|
|
782 |
|
|
4 |
|
|
1,506 |
|
|
19,608 |
|
Net income from discontinued operations, net of taxes |
|
— |
|
|
(18,288 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Reclassification of expenses |
|
4,900 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Adjusted EBITDA
(non-GAAP) |
|
$ |
9,360 |
|
|
$ |
15,436 |
|
|
$ |
6,630 |
|
|
$ |
8,669 |
|
|
$ |
5,799 |
|
|
$ |
21,098 |
|
|
$ |
(1,413 |
) |
|
|
Three Months Ended Sep 30, |
|
Nine Months Ended Sep 30, |
|
|
2019 |
|
2018 |
|
2019 |
|
2018 |
Net Cash (used in)
provided by operating activities |
|
$ |
(6,725 |
) |
|
|
$ |
10,719 |
|
|
$ |
11,839 |
|
|
$ |
(60,662 |
) |
Add /
(Less): |
|
|
|
|
|
|
|
|
Capitalized software |
|
(3,330 |
) |
|
|
(2,811 |
) |
|
(9,289 |
) |
|
(11,012 |
) |
Property and equipment |
|
(2,137 |
) |
|
|
(4,745 |
) |
|
(7,077 |
) |
|
(8,565 |
) |
Free
Cashflow |
|
$ |
(12,192 |
) |
|
|
$ |
3,163 |
|
|
$ |
(4,527 |
) |
|
$ |
(80,239 |
) |
Add: One-Time Expenses due to Restatement, etc. |
|
4 |
|
|
|
3,638 |
|
|
1,506 |
|
|
19,608 |
|
Adjusted Free
Cashflow |
|
$ |
(12,188 |
) |
|
|
$ |
6,801 |
|
|
$ |
(3,021 |
) |
|
$ |
(60,631 |
) |
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