FORT LAUDERDALE, Fla.,
Feb. 24, 2016 /PRNewswire/
-- Patriot National, Inc. (NYSE: PN), a leading provider of
technology and outsourcing solutions, today announced its financial
results for the fourth quarter and full year ended December 31, 2015.
Highlights:
For the quarter ended December 31,
2015:
(Comparisons to the corresponding prior-year
period)
- Total Revenues and Fee Income of $60.9
million, increased 51%
- GAAP Net Loss of $5.4 million, or
$0.19 per share
- Adjusted Earnings of $5.5
million, or $0.19 per diluted
share, up 204%
- Adjusted EBITDA of $14.6 million,
up 49%
- Operating Cash Flow of $5.6
million, up 65%
For the year ended December 31,
2015:
(Comparisons to the corresponding prior-year
period)
- Total Revenues of $209.7 million
and Fee Income of $209.8 million, up
79% and 104%, respectively
- GAAP Net Loss of $5.4 million, or
$0.20 per share
- Adjusted Earnings of $20.1
million, or $0.75 per diluted
share, up 236%
- Adjusted EBITDA of $51.5 million,
up 90%
- Operating Cash Flow of $37.1
million, up 729%
- Invested $3 million to add 90
insurance carrier clients
Recent Developments:
- On February 16, 2016, Patriot
National announced an expanded relationship with Travelers, the
second largest writer of commercial U.S. property and casualty
insurance, whereby Patriot National will initially offer all lines
of Travelers' small business insurance in 15 states, with plans for
national expansion.
- On January 28, 2016, Patriot
National acquired Mid Atlantic Insurance Services, which increased
Patriot National's property and casualty service offering with
eight new products, added 12 new carrier relationships and 1,100
new retail agencies.
- On January 26, 2016, the Company
appointed financial services industry veteran Michael Corey as its fourth independent
director, expanding the board to a total of six members.
- In early January, the Company expanded its hospitality program
through a partnership with ProSight Specialty Insurance to launch a
new restaurants, bars and taverns program encompassing property,
general liability and liquor liability.
- In February, Patriot Technology Solutions launched PN
ClaimsAlert, a mobile application that streamlines incident
reporting.
Management Commentary
"I am very proud of what our team accomplished in 2015. Our
strong execution on our two-pronged growth strategy that combines
organic growth with acquisitions helped us build one of the most
powerful platforms in the insurance industry today," said Steven M.
Mariano, Chief Executive Officer of Patriot National.
"The January 2016 acquisition of
Mid Atlantic solidifies our position as a premier workers'
compensation exchange of choice for agencies and employers.
Through our exchange, agencies and employers can access a minimum
of five quotes and bind coverage in real time in 44 states.
"We also continue to strengthen and diversify our
platform. Including the recent acquisition of Mid Atlantic,
today we have relationships with 139 carriers, up eight-fold
compared to 17 in 2014. Our distribution network stands at
4,100 agencies, which is four times larger than in 2014. In
addition, our menu of products and services is five times greater
than in 2014, spanning beyond workers' compensation to include a
wide array of commercial property and casualty insurance lines as
well as human capital management. Not only does this
extensive product depth, carrier choice and distribution directly
translate into increased submissions and fee income, it also
reduces revenue concentration by carrier, agency and product
line.
"We achieved this scale and diversification in a relatively
short period of time, partly due to the addition of 90 more
carriers than we had originally anticipated at the time of our IPO.
Adding these carriers strengthens our platform and sets the
stage for accelerated growth and profitability over the long term
as we capitalize on cross selling opportunities across a large base
of carriers. We invested approximately $3
million of incremental costs in 2015 to integrate these
carriers into our platform. Excluding these costs, our Adjusted
EBITDA for 2015 would have been $54.5
million.
"Our financial performance was stellar in the first full year of
being a public company. Total Fee Income and Adjusted EBITDA
increased approximately 79% and 90%, respectively, over 2014.
When excluding the additional costs associated with the onboarding
of new insurance carrier clients during 2015, Adjusted EBITDA
margin would approximate 26%.
"Our scalable, state-of-the-art technology is foundational to
our ability to deliver world-class services to our customers.
In 2015, we made great strides in advancing our technology platform
and began to offer our solution on a standalone basis. We
secured a major win with Missouri Employers Mutual who will
implement our fully integrated SaaS-based suite of solutions across
their entire insurance value chain. We are pleased with the
pipeline of potential additional carrier customers and we expect
standalone technology sales to accelerate in 2016.
"Most importantly, this year we built one of the most powerful
platforms and value propositions in the insurance industry and we
are well positioned for long-term sustainable growth.
Operating Results
Three Months Ended December 31,
2015
Total revenues were $60.9 million
for the fourth quarter of 2015, compared with $40.2 million in the fourth quarter of
2014. Total fee income was $60.9
million for the fourth quarter of 2015, an increase of 51.2%
compared with $40.2 million in the
fourth quarter of 2014. The increase in fee income during the
fourth quarter of 2015 was primarily due to an increase in customer
relationships and expanded number of service offerings. Organic fee
income of $46.0 million grew 14.4%
year-over-year.
Fee income from related party was 30% this quarter compared to
40% in the prior quarter and the Company is on track to achieve its
goal of reducing fee income from related party to less than 20% by
March 31, 2016.
Total expenses for the fourth quarter of 2015 were $59.6 million, compared with $41.4 million in the fourth quarter of 2014. The
increase was largely attributable to organic growth and the
acquisitions closed during the twelve months ended December 31, 2015.
Fourth quarter 2015 GAAP net loss was $5.4 million, or $0.19 per share, compared with a net loss of
$2.4 million, or $0.13 per share, in the fourth quarter of 2014.
The net loss includes income tax expense of $6.6 million which reflects the book to tax
timing differences in computing our full year 2015 tax
provision. Adjusted earnings for the fourth quarter of 2015
were $5.5 million, or $0.19 per diluted share, compared with Adjusted
earnings of $1.8 million, or
$0.10 per diluted share, in the
fourth quarter of 2014. Patriot National defines Adjusted
earnings or loss and Adjusted earnings or loss per share as net
income (loss) adjusted for cost for debt payoff, non-cash stock
compensation costs, net realized gains (losses) on investments,
increase (decrease) in fair value of warrant redemption liability,
increase in fair value of earn-out liability, acquisition costs,
severance expense, public offering costs, gain on financing
transaction, gain on disposal of fixed assets and the income tax
effect related to reconciling items.
Adjusted EBITDA for the fourth quarter of 2015 was $14.6 million, compared to Adjusted EBITDA of
$9.8 million for the fourth quarter
of 2014. Patriot National defines Adjusted EBITDA as net income
(loss) adjusted for income tax, interest, depreciation and
amortization, net realized gains (losses) on investments, increase
(decrease) in fair value of warrant redemption liability, costs for
debt payoff, non-cash stock compensation costs, acquisition costs,
severance expense, public offering costs, increase in fair value of
earn-out liability, gain on financing transaction and gain on
disposal of fixed assets. The increase in Adjusted EBITDA for the
fourth quarter of 2015 was largely attributable to a combination of
organic growth and the Company's acquisitions closed during the
twelve months ended December 31,
2015.
Operating Cash Flow for the fourth quarter of 2015 was
$5.6 million, compared to
$3.4 million for the fourth quarter
of 2014. Patriot National defines Operating Cash Flow as
Adjusted EBITDA less income tax expense, interest expense and
capital expenditures.
Full Year Ended December 31,
2015
Total revenues were $209.7 million
for the twelve months ended 2015, compared with $117.3 million in the same period a year
ago. Total fee income was $209.8
million for the twelve months ended December 31, 2015, an increase of 104.2% compared
to $102.7 million for the
corresponding prior-year period. The increase in fee income
during the twelve months ended 2015 was primarily due to an
increase in customer relationships and expanded number of service
offerings. Organic fee income of $173.8
million grew 69.2% year-over-year.
Total expenses for the twelve months ended December 31, 2015 were $210.1 million, compared with $95.2 million in the corresponding prior-year
period. The increase was largely attributable to organic growth and
the acquisitions closed during the twelve months ended December 31, 2015.
For the twelve months ended December 31,
2015, GAAP net loss was $5.4
million or $0.20 per share,
compared with GAAP net income of $10.4
million, or $0.66 per share,
for the twelve months ended December 31,
2014. The net loss includes income tax expense
of $4.9 million which reflects the
book to tax timing differences in computing our full year 2015 tax
provision. Adjusted earnings for the twelve months
ended December 31, 2015 were
$20.1 million, or $0.75 per diluted share, compared
with Adjusted earnings of $6.0
million, or $0.38 per diluted
share, in the prior-year period.
For the twelve months ended December 31,
2015, Adjusted EBITDA grew to $51.5
million up from $27.1 million
for the twelve months ended December
31, 2014. The increase in Adjusted EBITDA for the
twelve months ended December 31, 2015
was largely attributable to a combination of organic growth and the
Company's acquisitions closed during the twelve months ended
December 31, 2015.
Operating Cash Flow for the twelve months ended December 31, 2015 was $37.1 million, compared to Operating Cash Flow of
$4.5 million for the same period a
year ago.
Summary Financial Results
|
Quarter Ended
December 31,
|
|
Twelve Months
Ended December 31,
|
|
2015
|
2014
|
Change
|
|
2015
|
2014
|
Change
|
|
|
|
|
|
|
|
|
Total
Revenues
|
$ 60,872
|
$ 40,245
|
51.3%
|
|
$ 209,720
|
$ 117,264
|
78.8%
|
|
|
|
|
|
|
|
|
Total Fee
Income
|
$ 60,852
|
$ 40,245
|
51.2%
|
|
$ 209,764
|
$ 102,730
|
104.2%
|
Organic
|
$ 46,040
|
$ 40,245
|
14.4%
|
|
$ 173,805
|
$ 102,730
|
69.2%
|
Acquisitions
|
$ 14,812
|
$
-
|
n/a
|
|
$ 35,959
|
$
-
|
n/a
|
|
|
|
|
|
|
|
|
Net Income
(Loss)
|
$ (5,367)
|
$ (2,393)
|
n/a
|
|
$ (5,375)
|
$ 10,414
|
n/a
|
Earnings (Loss) per
diluted share
|
$ (0.19)
|
$ (0.13)
|
n/a
|
|
$ (0.20)
|
$0.66
|
n/a
|
|
|
|
|
|
|
|
|
Non-GAAP Adjusted
EBITDA
|
$ 14,626
|
$ 9,797
|
49.3%
|
|
$ 51,464
|
$ 27,131
|
89.7%
|
Non-GAAP Adjusted
EBITDA %
|
24.0%
|
24.3%
|
|
|
24.5%
|
26.4%
|
|
|
|
|
|
|
|
|
|
Non-GAAP Adjusted
Earnings
|
$ 5,453
|
$ 1,791
|
204.4%
|
|
$ 20,069
|
$ 5,981
|
235.5%
|
Non-GAAP Adjusted
Earnings EPS
|
$
0.19
|
$0.10
|
96.4%
|
|
$0.75
|
$0.38
|
98.3%
|
|
|
|
|
|
|
|
|
Non-GAAP Operating Cash
Flow
|
$ 5,636
|
$ 3,410
|
65.3%
|
|
$ 37,117
|
$ 4,479
|
728.7%
|
A Reconciliation of GAAP to Non-GAAP Financial Measures is
provided in the following financial tables.
Balance Sheet and Liquidity
At December 31, 2015, the Company
had liquidity of $73.4 million,
comprised of $11.4 million in cash on
hand and $22.0 million available
under the revolving credit facility. Additionally, the Company's
credit facility provides for an incremental $40 million term loan through an accordion
feature.
At December 31, 2015, the Company
had total debt of $126.8 million.
The Company's leverage ratio, comprised of total debt to
trailing 12 months Adjusted EBITDA (including the proforma effect
from acquisitions), was 2.3x.
Outlook for 2016 Financial Guidance
"By expanding our platform over the past 14 months, we have
significantly de-risked our business model by reducing
concentration by carriers, agencies and product lines. Our
more conservative outlook for fee income in 2016 reflects a more
diversified mix of fee income earned from workers' compensation and
non workers' compensation products and services as well as our
expanded mix of carrier partners," said Mariano.
For the full year ending December 31,
2016, Patriot National currently expects the following
financial results.
(millions)
|
|
|
2016
|
|
|
|
Range
|
Total Fee
Income1
|
|
|
$270 -
$280
|
|
|
|
|
GAAP Net
Income
|
|
|
$24 - $30
|
Adjusted
Earnings
|
|
|
$28 - $34
|
|
|
|
|
Adjusted
EBITDA
|
|
|
$73 - $78
|
Operating Cash
Flows
|
|
|
$48 - $54
|
|
|
|
|
1Total fee income includes the expected contribution
from the announced acquisition of Mid Atlantic on January 28, 2016, which is expected to contribute
fee income of $8 million in 2016.
Conference Call and Webcast
A conference call and audio webcast with analysts and investors
will be held on Thursday, February 25,
2016 at 9 a.m. Eastern Time,
to discuss the results and answer questions.
- Live conference call: 866-777-2509 (domestic) or 412-317-5413
(international)
- Conference call replay available through March 17, 2016: 877-344-7529 (domestic) or
412-317-0088 (international)
- Replay access code: 10079938
- Live and archived
webcast:ir.patnat.com
The Company is enabling investors to pre-register for the
earnings conference call so that they can expedite their entry into
the call and avoid the need to wait for a live operator. In order
to pre-register for the call, investors can visit
http://dpregister.com/10079938 and enter in their contact
information. Investors will then be issued a personalized phone
number and pin to dial into the live conference call. Individuals
can pre-register any time prior to the start of the conference call
on February 25.
About Non-GAAP Financial Measures
In addition to reporting financial results in accordance with
GAAP, this press release provides information regarding Adjusted
earnings and earnings per share (non-GAAP adjusted), Operating Cash
Flow and Adjusted EBITDA.
A reconciliation of GAAP net income (loss) to both Adjusted
earnings and Adjusted EBITDA can be found in the accompanying
table. Adjusted earnings and earnings per share, Operating Cash
Flow and Adjusted EBITDA should not be considered in isolation or
as a substitute for performance measures calculated in accordance
with GAAP. Patriot National compensates for these limitations by
relying primarily on its GAAP results and using Adjusted earnings
and earnings per share, Operating Cash Flow and Adjusted EBITDA
only as a supplement.
We have presented Adjusted earnings and earnings per share,
Operating Cash Flow and Adjusted EBITDA in this release because
they are key measures used by our management and board of directors
to understand and evaluate our core operating performance and
trends, to prepare and approve our annual budget and to develop
short and long-term operational plans. In particular, we
believe that the exclusion of the amounts eliminated in calculating
Adjusted earnings and earnings per share, Operating Cash Flow and
Adjusted EBITDA can provide useful measures for period-to-period
comparisons of our core business. Accordingly, we believe
that Adjusted earnings and earnings per share, Operating Cash Flow
and Adjusted EBITDA provide useful information to investors and
others in understanding and evaluating our operating results in the
same manner as our management and board of directors.
Adjusted earnings and earnings per share, Operating Cash Flow
and Adjusted EBITDA have limitations as analytical tools, and you
should not consider them in isolation or as a substitute for
analysis of our financial results as reported under GAAP.
Some of these limitations are as follows:
- Although depreciation and amortization expense are non-cash
charges, the assets being depreciated and amortized may have to be
replaced in the future;
- Adjusted EBITDA does not reflect changes in, or cash
requirements for, our working capital needs or tax payments that
may represent a reduction in cash available to us;
- Operating Cash Flow does not reflect changes in working capital
that may represent a reduction in cash available to us; and
- Other companies, including companies in our industry, may
calculate Adjusted Earnings or Adjusted EBITDA or similarly titled
measures differently, which reduces its usefulness as a comparative
measure.
About Patriot National
Patriot National, Inc. is a national provider of comprehensive
technology and outsourcing solutions that help insurance companies
and employers mitigate risk, comply with complex regulations and
save time and money. Patriot National provides general agency
services, technology outsourcing, software solutions, specialty
underwriting and policyholder services, claims administration
services, self-funded health plans and employment pre-screening
services to its insurance carrier clients, employers and other
clients. Patriot National is headquartered in Fort Lauderdale, Florida. For more
information about Patriot National, please visit
www.patnat.com.
Forward Looking Statements
This press release may include statements that may be deemed to
be forward-looking statements. Words such as "may," "will,"
"should," "likely," "anticipates," "expects," "intends," "plans,"
"projects," "believes," "estimates," "positioned," "outlook,"
"Guidance," and similar expressions are used to identify these
forward-looking statements. By their nature, forward-looking
statements involve risks and uncertainties, and there are important
factors that could cause actual results to differ materially from
those indicated in these statements, including the potential that
revenue, net income or Adjusted EBITDA could finally be determined
to be below the range discussed in this press release. For
example, we may not be able to place insurance policies for our
clients, our expenses may be higher than we expect, we may have
difficulty integrating new acquisitions, new acquisitions may not
perform as anticipated, as well as those matters contained in our
filings with the Securities and Exchange Commission. Although we
base these forward-looking statements on assumptions that we
believe are reasonable when made, we caution you that
forward-looking statements are not guarantees of future performance
or events and that results may differ materially from statements
made in or suggested by the forward-looking statements contained in
this press release. Any forward-looking statement that we may make
in this press release speaks only as of the date of such statement,
and we undertake no obligation to update any forward-looking
statement or to publicly announce the results of any revision to
any of those statements to reflect future events or
developments.
Media and Investor Contacts:
Julie MacMedan (310) 622-8242
Paige Hart (310) 622-8244
Financial Profiles, Inc.
PatriotNational@finprofiles.com
FINANCIAL TABLES TO FOLLOW
|
|
|
|
|
|
|
|
|
|
|
|
Patriot National,
Inc.
|
|
|
Consolidated
Statement of Operations
|
|
|
(In thousands, except
per share amounts)
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended December 31,
|
|
Year Ended
December 31,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In thousands, except
per share amounts
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
|
|
|
|
|
|
|
|
|
Total Fee
Income
|
|
$
60,852
|
|
$
40,245
|
|
$
209,764
|
|
$
102,730
|
|
|
Net investment
income
|
|
50
|
|
-
|
|
135
|
|
496
|
|
|
Net realized gains
(losses) on investments
|
|
(30)
|
|
-
|
|
(179)
|
|
14,038
|
|
|
Total
Revenues
|
|
60,872
|
|
40,245
|
|
209,720
|
|
117,264
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses
|
|
|
|
|
|
|
|
|
|
|
Salaries and related
expenses
|
|
23,282
|
|
14,513
|
|
77,064
|
|
32,420
|
|
|
Commission
expense
|
|
10,323
|
|
7,448
|
|
35,879
|
|
16,939
|
|
|
Outsourced
services
|
|
4,906
|
|
2,490
|
|
12,529
|
|
5,608
|
|
|
Other operating
expenses
|
|
9,610
|
|
6,020
|
|
34,869
|
|
21,083
|
|
|
Acquisition
costs
|
|
2,409
|
|
-
|
|
6,781
|
|
-
|
|
|
Interest
expense
|
|
1,019
|
|
3,777
|
|
3,544
|
|
9,204
|
|
|
Depreciation and
amortization
|
|
4,669
|
|
3,099
|
|
14,950
|
|
8,093
|
|
|
Stock compensation
expense
|
|
1,996
|
|
-
|
|
10,787
|
|
-
|
|
|
Costs from debt
payoff
|
|
-
|
|
-
|
|
13,681
|
|
-
|
|
|
(Decrease) increase
in fair value of warrant redemption liability
|
|
(25)
|
|
4,080
|
|
(1,410)
|
|
1,823
|
|
|
Public offering
costs
|
|
1,229
|
|
-
|
|
1,229
|
|
-
|
|
|
Increase in FV of
Earn-out liability
|
|
827
|
|
-
|
|
827
|
|
-
|
|
|
Gain on financing
transaction
|
|
(609)
|
|
-
|
|
(609)
|
|
-
|
|
|
Gain on disposal of
fixed assets
|
|
-
|
|
-
|
|
(7)
|
|
-
|
|
|
Total
Expenses
|
|
59,636
|
|
41,427
|
|
210,114
|
|
95,170
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss) before income tax expense
|
|
1,236
|
|
(1,182)
|
|
(394)
|
|
22,094
|
|
|
Income tax
expense
|
|
6,604
|
|
1,234
|
|
4,871
|
|
11,635
|
|
|
Net (Loss)
Income Including Non-Controlling Interest in
Subsidiary
|
|
(5,368)
|
|
(2,416)
|
|
(5,265)
|
|
10,459
|
|
|
Net income
(loss) attributable to non-controlling interest in
subsidiary
|
|
(1)
|
|
(23)
|
|
110
|
|
45
|
|
|
Net (Loss)
Income
|
|
$
(5,367)
|
|
$
(2,393)
|
|
$
(5,375)
|
|
$
10,414
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (Loss) Per
Common Share
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
(0.19)
|
|
$
(0.13)
|
|
$
(0.20)
|
|
$
0.66
|
|
|
Diluted
|
|
(0.19)
|
|
(0.13)
|
|
(0.20)
|
|
0.66
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average
Common Shares
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
27,668
|
|
18,075
|
|
26,425
|
|
15,754
|
|
|
Diluted
|
|
27,668
|
|
18,075
|
|
26,425
|
|
15,754
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
Balance Sheets
|
|
|
(In
thousands)
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December
31,
|
|
December
31,
|
|
|
In
thousands
|
|
2015
|
|
2014
|
|
|
Assets
|
|
|
|
|
|
|
Current
Assets
|
|
|
|
|
|
|
Cash
|
|
$
8,272
|
|
$
4,251
|
|
|
Short term
investments
|
|
3,173
|
|
-
|
|
|
Total cash and
investments
|
|
11,445
|
|
4,251
|
|
|
Restricted
cash
|
|
16,055
|
|
6,923
|
|
|
Fee income
receivable
|
|
8,159
|
|
1,942
|
|
|
Fee income
receivable from related party
|
|
27,036
|
|
11,988
|
|
|
Net receivable
from related parties
|
|
599
|
|
1,773
|
|
|
Deferred costs
for initial public offering
|
|
-
|
|
2,682
|
|
|
Income taxes
receivable
|
|
-
|
|
-
|
|
|
Other current
assets
|
|
2,046
|
|
430
|
|
|
Total current
assets
|
|
65,340
|
|
29,989
|
|
|
Fixed assets,
net of depreciation
|
|
5,092
|
|
1,879
|
|
|
Deferred loan
fees
|
|
2,352
|
|
5,911
|
|
|
Goodwill
|
|
118,141
|
|
61,493
|
|
|
Intangible
assets
|
|
75,681
|
|
32,988
|
|
|
Deferred tax
asset, net of valuation allowance
|
|
-
|
|
-
|
|
|
Forward
purchase asset
|
|
28,120
|
|
-
|
|
|
Advance on
facilitation agreeement
|
|
2,000
|
|
-
|
|
|
Other long term
assets
|
|
11,428
|
|
9,842
|
|
|
Total
Assets
|
|
$
308,154
|
|
$
142,102
|
|
|
|
|
|
|
|
|
|
Liabilities and
Stockholders' Equity (Deficit)
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
Deferred claims
administration services income
|
|
$
10,639
|
|
$
8,515
|
|
|
Net advanced
claims reimbursements
|
|
1,835
|
|
6,803
|
|
|
Net payables to
related parties
|
|
-
|
|
-
|
|
|
Income taxes
payable
|
|
2,996
|
|
11,548
|
|
|
Current
earn-out payable
|
|
10,556
|
|
-
|
|
|
Accounts
payable, accrued expenses and other liabilities
|
|
32,809
|
|
15,027
|
|
|
Deferred
purchase consideration
|
|
6,128
|
|
-
|
|
|
Revolver
borrowings outstanding
|
|
18,032
|
|
-
|
|
|
Current portion
of notes payable
|
|
5,500
|
|
15,782
|
|
|
Current portion
of capital lease obligation
|
|
2,232
|
|
2,332
|
|
|
Total current
liabilities
|
|
90,727
|
|
60,007
|
|
|
Earn-out
payable
|
|
1,827
|
|
-
|
|
|
Notes
payable
|
|
101,000
|
|
95,039
|
|
|
Capital lease
obligation
|
|
-
|
|
2,438
|
|
|
Deferred tax
liability
|
|
-
|
|
-
|
|
|
Warrant
redemption liability
|
|
28,120
|
|
12,879
|
|
|
Total
liabilities
|
|
221,674
|
|
170,363
|
|
|
|
|
|
|
|
|
|
Stockholders'
Equity (Deficit)
|
|
|
|
|
|
|
Total Patriot
National, Inc. Stockholders' Equity (Deficit)
|
|
86,715
|
|
(27,916)
|
|
|
Less
non-controlling interest
|
|
(235)
|
|
(345)
|
|
|
Total
Stockholders' Equity (Deficit)
|
|
86,480
|
|
(28,261)
|
|
|
Total
Liabilities and Stockholders' Equity (Deficit)
|
|
$
308,154
|
|
$
142,102
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
GAAP to Non-GAAP Financial Measures
|
|
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended December 31,
|
|
Year Ended
December 31,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In
thousands
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
Reconciliation from
Net Income (Loss) to Adjusted EBITDA:
|
|
|
|
|
|
|
|
|
|
|
Net Income
(Loss)
|
|
$
(5,367)
|
|
$
(2,393)
|
|
$
(5,375)
|
|
$
10,414
|
|
|
Income tax (benefit)
expense
|
|
6,604
|
|
1,234
|
|
4,871
|
|
11,635
|
|
|
Interest
expense
|
|
1,019
|
|
3,777
|
|
3,544
|
|
9,204
|
|
|
Depreciation and
amortization
|
|
4,669
|
|
3,099
|
|
14,950
|
|
8,093
|
|
|
EBITDA
|
|
6,925
|
|
5,717
|
|
17,990
|
|
39,346
|
|
|
(Decrease) increase
in fair value of warrant redemption liability
|
|
(25)
|
|
4,080
|
|
(1,410)
|
|
1,823
|
|
|
Costs from debt
payoff
|
|
-
|
|
-
|
|
13,681
|
|
-
|
|
|
Net realized (gains)
losses on investments
|
|
30
|
|
-
|
|
179
|
|
(14,038)
|
|
|
Stock compensation
expense
|
|
1,996
|
|
-
|
|
10,787
|
|
-
|
|
|
Acquisition
costs
|
|
2,409
|
|
-
|
|
6,781
|
|
-
|
|
|
Severance
expense
|
|
1,844
|
|
-
|
|
2,016
|
|
-
|
|
|
Public offering
costs
|
|
1,229
|
|
-
|
|
1,229
|
|
-
|
|
|
Increase in FV of
Earn-out liability
|
|
827
|
|
-
|
|
827
|
|
-
|
|
|
Gain on financing
transaction
|
|
(609)
|
|
-
|
|
(609)
|
|
-
|
|
|
Gain on disposal of
fixed assets
|
|
-
|
|
-
|
|
(7)
|
|
-
|
|
|
Adjusted
EBITDA
|
|
$
14,626
|
|
$
9,797
|
|
$
51,464
|
|
$
27,131
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Calculation of
Adjusted EBITDA margins:
|
|
|
|
|
|
|
|
|
|
|
Total Fee
Income
|
|
$
60,852
|
|
$
40,245
|
|
$
209,764
|
|
$
102,730
|
|
|
Adjusted
EBITDA
|
|
$
14,626
|
|
$
9,797
|
|
$
51,464
|
|
$
27,131
|
|
|
Adjusted EBITDA
margins
|
|
24.0%
|
|
24.3%
|
|
24.5%
|
|
26.4%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended December 31,
|
|
Year Ended
December 31,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In thousands, except
per share amounts
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
Reconciliation from
Net Income (Loss) to Adjusted Earnings:
|
|
|
|
|
|
|
|
|
|
|
Net (Loss)
Income
|
|
$
(5,367)
|
|
$
(2,393)
|
|
$
(5,375)
|
|
$
10,414
|
|
|
Net income (loss)
attributable to non-controlling interest in subsidiary
|
|
(1)
|
|
(23)
|
|
110
|
|
45
|
|
|
Income tax
expense
|
|
6,604
|
|
1,234
|
|
4,871
|
|
11,635
|
|
|
Net income (loss)
before income tax expense
|
|
1,236
|
|
(1,182)
|
|
(394)
|
|
22,094
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments to Net
income (loss) before income tax expense:
|
|
|
|
|
|
|
|
|
|
|
(Decrease) increase
in fair value of warrant redemption liability
|
|
(25)
|
|
4,080
|
|
(1,410)
|
|
1,823
|
|
|
Costs from debt
payoff
|
|
-
|
|
-
|
|
13,681
|
|
-
|
|
|
Net realized (gains)
losses on investments
|
|
30
|
|
-
|
|
179
|
|
(14,038)
|
|
|
Stock compensation
expense
|
|
1,996
|
|
-
|
|
10,787
|
|
-
|
|
|
Acquisition
costs
|
|
2,409
|
|
-
|
|
6,781
|
|
-
|
|
|
Severance
expense
|
|
1,844
|
|
-
|
|
2,016
|
|
-
|
|
|
Public offering
costs
|
|
1,229
|
|
-
|
|
1,229
|
|
-
|
|
|
Increase in FV of
Earn-out liability
|
|
827
|
|
-
|
|
827
|
|
-
|
|
|
Gain on financing
transaction
|
|
(609)
|
|
-
|
|
(609)
|
|
-
|
|
|
Gain on disposal of
fixed assets
|
|
-
|
|
-
|
|
(7)
|
|
-
|
|
|
Total
|
|
7,701
|
|
4,080
|
|
33,474
|
|
(12,215)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net income
(loss) before income tax expense
|
|
8,937
|
|
2,898
|
|
33,080
|
|
9,879
|
|
|
Income tax
expense (benefit) at statutory rate
|
|
3,485
|
|
1,130
|
|
12,901
|
|
3,853
|
|
|
Adjusted net
(Loss) Income Including Non-Controlling Interest in
Subsidiary
|
|
5,452
|
|
1,768
|
|
20,179
|
|
6,026
|
|
|
Net income
(loss) attributable to non-controlling interest in
subsidiary
|
|
(1)
|
|
(23)
|
|
110
|
|
45
|
|
|
Adjusted
Earnings (Loss)
|
|
$
5,453
|
|
$
1,791
|
|
$
20,069
|
|
$
5,981
|
|
|
Calculation of
Adjusted Earnings (Loss) Per Common Share
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
0.20
|
|
$
0.10
|
|
$
0.76
|
|
$
0.38
|
|
|
Diluted
|
|
0.19
|
|
0.10
|
|
0.75
|
|
0.38
|
|
|
Weighted Average
Common Shares Outsanding
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
27,668
|
|
18,075
|
|
26,425
|
|
15,754
|
|
|
Diluted
|
|
28,015
|
|
18,075
|
|
26,652
|
|
15,754
|
|
|
Statutory Tax
Rate
|
|
39.0%
|
|
39.0%
|
|
39.0%
|
|
39.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended December 31,
|
|
Year Ended
December 31,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In
thousands
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
Reconciliation from
Net Income (Loss) to Operating Cash Flow:
|
|
|
|
|
|
|
|
|
|
|
Net Income
(Loss)
|
|
$
(5,367)
|
|
$
(2,393)
|
|
$
(5,375)
|
|
$
10,414
|
|
|
Income tax (benefit)
expense
|
|
6,604
|
|
1,234
|
|
4,871
|
|
11,635
|
|
|
Interest
expense
|
|
1,019
|
|
3,777
|
|
3,544
|
|
9,204
|
|
|
Depreciation and
amortization
|
|
4,669
|
|
3,099
|
|
14,950
|
|
8,093
|
|
|
EBITDA
|
|
6,925
|
|
5,717
|
|
17,990
|
|
39,346
|
|
|
(Decrease) increase
in fair value of warrant redemption liability
|
|
(25)
|
|
4,080
|
|
(1,410)
|
|
1,823
|
|
|
Costs from debt
payoff
|
|
-
|
|
-
|
|
13,681
|
|
-
|
|
|
Net realized (gains)
losses on investments
|
|
30
|
|
-
|
|
179
|
|
(14,038)
|
|
|
Stock compensation
expense
|
|
1,996
|
|
-
|
|
10,787
|
|
-
|
|
|
Acquisition
costs
|
|
2,409
|
|
-
|
|
6,781
|
|
-
|
|
|
Severance
expense
|
|
1,844
|
|
-
|
|
2,016
|
|
-
|
|
|
Public offering
costs
|
|
1,229
|
|
-
|
|
1,229
|
|
-
|
|
|
Increase in FV of
Earn-out liability
|
|
827
|
|
-
|
|
827
|
|
-
|
|
|
Gain on financing
transaction
|
|
(609)
|
|
-
|
|
(609)
|
|
-
|
|
|
Gain on disposal of
fixed assets
|
|
-
|
|
-
|
|
(7)
|
|
-
|
|
|
Adjusted
EBITDA
|
|
14,626
|
|
9,797
|
|
51,464
|
|
27,131
|
|
|
Less: Income tax
expense
|
|
(6,604)
|
|
(1,234)
|
|
(4,871)
|
|
(11,635)
|
|
|
Less: Interest
expense
|
|
(1,019)
|
|
(3,777)
|
|
(3,544)
|
|
(9,204)
|
|
|
Less: Purchase of
fixed assets and other long-term assets
|
|
(1,367)
|
|
(1,376)
|
|
(5,932)
|
|
(1,813)
|
|
|
Operating Cash Flow
(1)
|
|
$
5,636
|
|
$
3,410
|
|
$
37,117
|
|
$
4,479
|
|
|
|
|
|
|
|
(1) Operating Cash
Flow is defined as Adjusted EBITDA less income tax expense,
interest expense, and capital expenditures
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Photo - http://photos.prnewswire.com/prnh/20141209/163423LOGO
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/patriot-national-reports-record-fee-income-for-the-fourth-quarter-ended-december-31-2015-and-record-fee-income-and-adjusted-ebitda-for-the-year-ended-december-31-2015-300225791.html
SOURCE Patriot National, Inc.