Reports Meaningful Increase in Net Revenues;
Financial Results Exceed Expectations Voortman Business
Provides Profit Accretion Ahead of Plan
Hostess Brands, Inc. (NASDAQ: TWNK, TWNKW) (the “Company”),
today reported its financial results for the three and six months
ended June 30, 2020.
“Growth in core Hostess® and Voortman® branded products and
excellent execution on the integration of Voortman helped to propel
second quarter financial results ahead of expectations,” commented
Andy Callahan, the Company's President and Chief Executive Officer.
“In a dynamic operating environment resulting from the on-going
COVID-19 pandemic, we executed very well, supported by a strong
team, our core competencies and nimble culture. We supported strong
demand by collaboratively working with retail and distribution
partners to adjust the nature and timing of our merchandising
programs as we continued to advance our innovation pipeline to
drive long-term growth. We are confident that we can leverage the
Company's leading brands, category-leading distribution and agile
operating network to satisfy evolving consumer behaviors and create
an even stronger company in the future.”
Financial Highlights for the Second Quarter 2020 as Compared
to the Prior Year Period1
- Net revenue was $256.2 million, an increase of 11.7%*. Adjusted
net revenue was $263.0 million, an increase of 14.7%*, driven
primarily by strong performance of recently acquired Voortman
Cookies Limited (“Voortman”) and Hostess® branded sales, partially
offset by lower private-label and other non-Hostess branded
sales.
- Gross profit was $89.4 million, an increase of 10.5%*. Adjusted
gross profit was $98.1 million, a 21.1%* increase due to the
accretive margin expansion generated from the successful
integration of Voortman ahead of expectations.
- Net income was $17.4 million, or $0.13 per diluted share,
compared to $16.7 million, or $0.10 per diluted share, in the prior
year period. Adjusted net income increased $5.1 million, or 21.2%,
to $29.2 million, resulting in $0.22 adjusted EPS compared to $0.17
adjusted EPS in the prior year period. The increase in adjusted net
income and adjusted EPS was primarily due to the accretion from the
Voortman acquisition.
- Adjusted EBITDA was $65.1 million, or 24.8% of adjusted net
revenue, an increase of 22.6%*. The increase was primarily driven
by Voortman's adjusted EBITDA contribution.
- Cash and cash equivalents were $127.8 million as of June 30,
2020 with a proforma leverage ratio of 4.3x after factoring in the
expected 2020 adjusted EBITDA contribution from Voortman.
∗ Excluding the In-Store Bakery business sold
in 2019.
Operational Highlights for the Second Quarter
2020
- Executed meaningful changes to Hostess product mix and
production schedules in response to dynamically changing consumer
demands in order to achieve margin expansion in our base
business.
- Completed key integration activities transitioning Voortman to
the warehouse distribution model from a direct-store delivery
model. Continue to expect transition costs of $25 million to $30
million, better than original expectations, and made meaningful
progress against attainment of the $15 million of cost synergies
target.
- Continued to implement heightened safety measures company-wide
to protect employees.
- Point of sale increased 7.4% and market share was 19.3%,
essentially flat, within the Sweet Baked Goods category. Hostess®
branded point of sale of 9.2% was ahead of the category
growth.
1This press release contains certain
non-GAAP financial measures, including adjusted revenue, adjusted
gross profit, adjusted gross margin, adjusted EBITDA, adjusted net
income, adjusted operating income, and adjusted earnings per share
(“EPS”). Please refer to the schedules in the press release for
reconciliations of non-GAAP financial measures to the comparable
GAAP measure. Unless otherwise stated, all comparisons of financial
measures in this press release are to the second quarter of 2019.
All measures of market performance contained in this press release,
including point of sale and market share include all Company
branded products within the SBG category as reported by Nielsen but
do not include other products sold outside of the SBG category. All
market data in this press release refer to the 13 week period ended
June 27, 2020. All market data in this press release reflect the
restatement of historical convenience channel data executed by
Nielsen during 2020. The Company's proforma leverage ratio is net
debt (total long-term debt less cash) divided by adjusted EBITDA
(including $25.0 million of expected Voortman EBITDA less $1.2
million of ISB historical EBITDA).
2020 Outlook
The Company previously issued its full year 2020 guidance on
February 26, 2020, which did not include the impact of COVID-19.
Despite year-to-date results that have exceeded Company
expectations, the Company's full 2020 Outlook remains suspended due
to the dynamic operating environment and the high degree of
uncertainty caused by the COVID-19 pandemic. However, assuming
there are no significant disruptions to our supply chain or changes
to consumer demand resulting from U.S. movement restrictions, we
now expect the following consolidated financial results for the
full year 2020:
- Adjusted EBITDA of $230 million to $240 million, including
Voortman Adjusted EBITDA of $25 million to $30 million.
- Adjusted EPS of $0.70 to $0.75
- Leverage ratio of approximately 4x at the end of 2020
The Company reaffirms its long-term financial objectives of
organic revenue growth, adjusted EBITDA margins and free cash flow
conversion in the top-quartile of its peers.
The Company provides guidance only on a non-generally accepted
accounting principles (non-GAAP) basis and does not provide a
reconciliation of the Company's forward-looking financial
expectations to the most directly comparable GAAP financial measure
because of the inherent difficulty in forecasting and quantifying
certain amounts that are necessary for such reconciliation;
including adjustments that could be made for deferred taxes;
remeasurement of the Tax Receivable Agreement, changes in
allocation to the non-controlling interest, transformation expenses
and other non-operating gains or losses reflected in the Company's
reconciliation of historic non-GAAP financial measures, the amount
of which could be material. Please refer to the Reconciliation of
Non-GAAP Financial Measures included in this press release for
further information about the use of these measures.
Second Quarter 2020 Compared to Second Quarter 20191
Net revenue was $256.2 million, an increase of 6.3%, or $15.1
million, compared to $241.1 million. Adjusting for the $6.8 million
cost of obtaining warehouse space needed to facilitate the Voortman
transition, adjusted net revenue was $263.0 million an increase of
14.7%*. The increase in adjusted net revenue was driven primarily
by the acquisition of Voortman which contributed $30.4 million of
adjusted net revenue. Sweet baked goods net revenue increased $3.3
million, primarily driven by higher volume of core Hostess® branded
multi-pack products partially offset by lower sales of private
label and non-Hostess branded products and lower sales of Hostess®
branded single-serve products due to impacts of COVID-19 on
consumer shopping habits.
Gross profit was $89.4 million, or 34.9% of net revenue,
compared to $83.5 million, or 34.6% of net revenue. Excluding ISB,
gross profit increased 10.5%. Adjusted gross profit was $98.1
million, or 37.3% of adjusted net revenue, compared to $83.5
million, or 34.6% of adjusted net revenue. Adjusted gross profit
increased 21.1%* as a result of accretion from Voortman supported
by achievement of synergies and higher operating efficiencies
gained with increased volume, partially offset by negative product
mix and higher operating costs due to COVID-19.
Operating costs and expenses were $54.8 million compared to
$46.6 million. The increase was primarily attributed to costs
related to the transition of Voortman's operations as well as
Voortman's on-going operating costs, partially offset by prior-year
charges for long-term incentive payments, remeasurement of the tax
receivable agreement and an impairment of the In-store Bakery
business.
The Company's effective tax rate was 24.0% compared to 35.2%.
The Company recognized a discrete tax expense of $2.8 million in
the prior year resulting from revaluing deferred tax balances based
on changes in the estimated state apportionment factors and tax
rates.
Net income was $17.4 million compared to $16.7 million and EPS
was $0.13 per diluted share compared to $0.10 per diluted share.
Adjusted net income was $29.2 million compared to $24.1 million and
adjusted EPS was $0.22, compared to $0.17. Adjusted net income
increased as a result of the higher volume and increase in gross
profit noted above, partially offset by higher operating costs,
depreciation, amortization and interest expense as a result of the
Voortman acquisition.
Adjusted EBITDA was $65.1 million, or 24.8% of adjusted net
revenue, compared to $55.1 million, or 22.9% of adjusted net
revenue, an increase of $10.0 million, or 18.1%. Excluding the
impact of ISB, adjusted EBITDA increased $12.0 million or 22.6%.
The increase was primarily driven by approximately $9 million of
adjusted EBITDA from Voortman.
Cash from operations for the six months ended June 30, 2020 was
$60.7 million compared to $74.1 million for the same period last
year. The decrease was primarily attributable to higher integration
and transition costs.
∗ Excluding the In-Store Bakery business sold
in 2019.
Conference Call and Webcast
The Company will host a conference call and webcast with an
accompanying presentation today, August 5, 2020 at 4:30 p.m. EDT to
discuss the results for the second quarter. Investors interested in
participating in the live call can dial 877-451-6152 from the U.S.
and 201-389-0879 internationally. A telephone replay will be
available approximately two hours after the call concludes through
Wednesday, August 19, 2020, by dialing 844-512-2921 from the U.S.,
or 412-317-6671 from international locations, and entering
confirmation code 13704985. The simultaneous, live webcast and
presentation will be available on the Investor Relations section of
the Company’s website at www.hostessbrands.com. The webcast will be
archived for 30 days.
About Hostess Brands, Inc.
Hostess Brands, Inc. is a leading packaged food company focused
on developing, manufacturing, marketing, selling and distributing
fresh baked sweet goods in North America. The Hostess® brand's
history dates back to 1919, when the Hostess® CupCake was
introduced to the public, followed by Twinkies® in 1930. Today, the
Company produces a variety of new and classic treats in addition to
Twinkies® and CupCakes, including Donettes®, Ding Dongs®, Zingers®,
Danishes, Honey Buns and Coffee Cakes. In January 2020, the Company
acquired Voortman Cookies Limited which produces a variety of
cookies and wafers products, including sugar-free products under
the Voortman® brand. For more information about Hostess® products
and Hostess Brands, please visit hostesscakes.com. Follow Hostess
on Twitter: @Hostess_Snacks; on Facebook: facebook.com/Hostess; on
Instagram: Hostess_Snacks; and on Pinterest:
pinterest.com/hostesscakes.
The Company has one reportable segment: Snacking (formerly
referred to as Sweet Baked Goods, or “SBG”). The Snacking segment
consists of sweet baked goods, cookies, bread and buns and frozen
retail products that are sold under the Hostess®, Dolly Madison®,
Cloverhill®, Big Texas®, and Voortman® brands. Through August 30,
2019, we operated in two reportable segments: SBG and In-Store
Bakery (“ISB”), which was sold. The In-Store Bakery segment
consists of Superior on Main® and private label products sold
through the in-store bakery section of grocery and club stores. The
Company divested its In-Store Bakery segment's operations on August
30, 2019.
Forward-Looking Statements
This press release contains statements reflecting the Company's
views about its future performance that constitute “forward-looking
statements” within the meaning of Section 27A of the Securities Act
of 1933, as amended and Section 21E of the Securities Exchange Act
of 1934, as amended, that involve substantial risks and
uncertainties. Forward-looking statements are generally identified
through the inclusion of words such as “believes,” “expects,”
“intends,” “estimates,” “projects,” “anticipates,” “will,” “plan,”
“may,” “should,” or similar language. Statements addressing the
Company's future operating performance and statements addressing
events and developments that the Company expects or anticipates
will occur are also considered as forward-looking statements. All
forward-looking statements included herein are made only as of the
date hereof. The Company undertakes no obligation to update any
forward-looking statement, whether as a result of new information,
future events, or otherwise.
These statements inherently involve risks and uncertainties that
could cause actual results to differ materially from those
anticipated in such forward-looking statements. These risks and
uncertainties include, but are not limited to, maintaining,
extending and expanding the Company's reputation and brand image;
protecting intellectual property rights; leveraging the Company's
brand value to compete against lower-priced alternative brands;
correctly predicting, identifying and interpreting changes in
consumer preferences and demand and offering new products to meet
those changes; operating in a highly competitive industry; the
ability to maintain or add additional shelf or retail space for the
Company's products; the continued ability to produce and
successfully market products with extended shelf life; our ability
to successfully integrate, achieve expected synergies and manage
our acquired businesses and brands; the ability to drive revenue
growth in key products or add products that are faster-growing and
more profitable; volatility in commodity, energy, and other input
prices and the ability to adjust pricing to cover increased costs;
dependence on major customers; geographic focus could make the
Company particularly vulnerable to economic and other events and
trends in North America; increased costs in order to comply with
governmental regulation; general political, social and economic
conditions; a portion of the workforce belongs to unions and
strikes or work stoppages could cause the business to suffer;
product liability claims, product recalls, or regulatory
enforcement actions; unanticipated business disruptions; dependence
on third parties for significant services; insurance may not
provide adequate levels of coverage against claims; failures,
unavailability, or disruptions of the Company's information
technology systems; dependence on key personnel or a highly skilled
and diverse workforce; and the Company's ability to finance
indebtedness on terms favorable to the Company; and other risks as
set forth from time to time in the Company's Securities and
Exchange Commission filings.
As a result of a number of known and unknown risks and
uncertainties, the Company's actual results or performance may be
materially different from those expressed or implied by these
forward-looking statements. Risks and uncertainties are identified
and discussed in Item 1A-Risk Factors in the Company's Annual
Report on Form 10-K for 2019 and its Quarterly Report on Form 10-Q
for the quarter ended June 30, 2020 to be filed today. The impact
of COVID-19 may also exacerbate these risks, any of which could
have a material effect on the Company. This situation is changing
rapidly and additional impacts may arise that the Company is not
aware of currently. All subsequent written or oral forward-looking
statements attributable to us or persons acting on the Company's
behalf are expressly qualified in their entirety by these risk
factors. The Company undertakes no obligation to update any
forward-looking statement, whether as a result of new information,
future events, or otherwise.
HOSTESS BRANDS, INC.
CONSOLIDATED BALANCE
SHEETS
(Unaudited, amounts in
thousands, except shares and per share data)
June 30, 2020
December 31,
2019
ASSETS
Current assets:
Cash and cash equivalents
$
127,779
$
285,087
Accounts receivable, net
141,175
104,892
Inventories
51,782
47,608
Prepaids and other current assets
16,572
15,569
Total current assets
337,308
453,156
Property and equipment, net
281,144
242,384
Intangible assets, net
1,980,859
1,853,315
Goodwill
702,917
535,853
Other assets, net
17,395
12,993
Total assets
$
3,319,623
$
3,097,701
LIABILITIES AND STOCKHOLDERS’
EQUITY
Current liabilities:
Long-term debt and lease obligations
payable within one year
$
13,705
$
11,883
Tax receivable agreement payments payable
within one year
17,500
12,100
Accounts payable
67,169
68,566
Customer trade allowances
59,293
45,715
Accrued expenses and other current
liabilities
45,366
21,661
Total current liabilities
203,033
159,925
Long-term debt and lease obligations
1,109,286
975,405
Tax receivable agreement obligations
126,208
126,096
Deferred tax liability
293,329
256,051
Other long-term liabilities
1,340
—
Total liabilities
1,733,196
1,517,477
Class A common stock, $0.0001 par value,
200,000,000 shares authorized, 124,408,614 and 122,108,086 shares
issued and outstanding at June 30, 2020 and December 31, 2019,
respectively
12
12
Class B common stock, $0.0001 par value,
50,000,000 shares authorized, 6,301,285 and 8,409,834 shares issued
and outstanding at June 30, 2020 and December 31, 2019,
respectively
1
1
Additional paid in capital
1,176,815
1,152,055
Accumulated other comprehensive loss
(11,034
)
(756
)
Retained earnings
352,998
334,480
Stockholders’ equity
1,518,792
1,485,792
Non-controlling interest
67,635
94,432
Total liabilities and stockholders’
equity
$
3,319,623
$
3,097,701
HOSTESS BRANDS, INC.
CONSOLIDATED STATEMENTS OF
OPERATIONS
(Unaudited, amounts in
thousands, except shares and per share data)
Three Months Ended
Six Months Ended
June 30, 2020
June 30, 2019
June 30, 2020
June 30, 2019
Net revenue
$
256,226
$
241,060
$
499,711
$
463,798
Cost of goods sold
166,852
157,610
331,000
305,160
Gross profit
89,374
83,450
168,711
158,638
Operating costs and expenses:
Advertising and marketing
11,158
10,696
21,221
19,559
Selling expense
12,378
8,310
30,498
16,830
General and administrative
24,153
19,276
49,348
36,747
Amortization of customer relationships
7,110
6,009
13,594
11,994
Business combination transaction costs
—
—
4,282
—
Other operating expense
—
2,278
27
517
Total operating costs and expenses
54,799
46,569
118,970
85,647
Operating income
34,575
36,881
49,741
72,991
Other expense:
Interest expense, net
10,580
10,302
22,305
20,538
Other expense
1,132
846
1,685
1,286
Total other expense
11,712
11,148
23,990
21,824
Income before income taxes
22,863
25,733
25,751
51,167
Income tax expense
5,493
9,064
5,741
7,886
Net income
17,370
16,669
20,010
43,281
Less: Net income attributable to the
non-controlling interest
1,200
5,186
1,492
10,672
Net income attributable to Class A
stockholders
$
16,170
$
11,483
$
18,518
$
32,609
Earnings per Class A share:
Basic
$
0.13
$
0.11
$
0.15
$
0.32
Diluted
$
0.13
$
0.10
$
0.15
$
0.31
Weighted-average shares outstanding:
Basic
123,638,723
105,072,322
123,381,190
102,618,951
Diluted
124,576,409
109,509,195
125,312,658
105,338,010
Results of
Operations by Segment
Three Months Ended
Six Months Ended
(In thousands)
June 30, 2020
June 30, 2019
June 30, 2020
June 30, 2019
Net Revenue
Snacking
$
256,226
$
229,273
$
499,711
$
442,151
In-Store Bakery
—
11,787
—
21,647
$
256,226
$
241,060
$
499,711
$
463,798
Gross Profit
Snacking
$
89,374
$
80,925
$
168,711
$
154,069
In-Store Bakery
—
2,525
—
4,569
$
89,374
$
83,450
$
168,711
$
158,638
HOSTESS BRANDS, INC.
CONSOLIDATED STATEMENTS OF
CASH FLOWS
(Unaudited, amounts in
thousands)
Six Months Ended
June 30, 2020
June 30, 2019
Operating activities
Net income
$
20,010
$
43,281
Depreciation and amortization
26,477
21,939
Impairment of property, goodwill and
intangibles
—
1,005
Debt discount (premium) amortization
664
(536
)
Tax receivable agreement remeasurement
—
(483
)
Unrealized foreign exchange losses
996
—
Non-cash lease expense
641
—
Share-based compensation
4,503
4,780
Deferred taxes
3,973
5,637
Loss on sale of assets
128
—
Change in operating assets and
liabilities, net of acquisitions and dispositions:
Accounts receivable
(11,320
)
(22,508
)
Inventories
4,135
(4,313
)
Prepaids and other current assets
(1,091
)
(1,661
)
Accounts payable and accrued expenses
3,323
18,168
Customer trade allowances
8,242
8,755
Net cash provided by operating
activities
60,681
74,064
Investing activities
Purchases of property and equipment
(23,376
)
(15,398
)
Acquisition of business, net of cash
acquired
(318,427
)
—
Acquisition and development of software
assets
(3,402
)
(2,907
)
Net cash used in investing activities
(345,205
)
(18,305
)
Financing activities
Repayments of long-term debt and lease
obligations
(5,584
)
(5,056
)
Proceeds from long-term debt origination,
net of fees paid
136,888
—
Distributions to non-controlling
interest
(1,977
)
(4,916
)
Tax payments related to issuance of shares
to employees
(1,036
)
(124
)
Cash received from exercise of options and
warrants
563
23
Payments on tax receivable agreement
(1,279
)
(2,779
)
Net cash provided by (used in) financing
activities
127,575
(12,852
)
Effect of exchange rate changes on cash
and cash equivalents
(359
)
—
Net increase (decrease) in cash and
cash equivalents
(157,308
)
42,907
Cash and cash equivalents at beginning of
period
285,087
146,377
Cash and cash equivalents at end of
period
$
127,779
$
189,284
Supplemental Disclosures of Cash Flow
Information:
Cash paid during the period for:
Interest
$
21,885
$
22,472
Net taxes paid (refunded)
$
(577
)
$
1,815
Supplemental disclosure of non-cash
investing:
Accrued capital expenditures
$
1,542
$
1,527
HOSTESS BRANDS, INC. RECONCILIATION OF
NON-GAAP FINANCIAL MEASURES
Adjusted net revenue, adjusted gross profit, adjusted operating
income, adjusted net income, adjusted EBITDA and adjusted EPS
collectively referred to as “Non-GAAP Financial Measures,” are
commonly used in the Company's industry and should not be construed
as an alternative to net revenue, gross profit, operating income,
net income or earnings per share as indicators of operating
performance (as determined in accordance with GAAP). These Non-GAAP
Financial Measures may not be comparable to similarly titled
measures reported by other companies. The Company has included
these Non-GAAP Financial Measures because it believes the measures
provide management and investors with additional information to
measure the Company's performance, estimate the Company's value and
evaluate the Company's ability to service debt.
Non-GAAP Financial Measures are adjusted to exclude certain
items that affect comparability. The adjustments are itemized in
the tables below. You are encouraged to evaluate these adjustments
and the reason the Company considers them appropriate for
supplemental analysis. In evaluating adjustments, you should be
aware that in the future the Company may incur expenses that are
the same as or similar to some of the adjustments set forth below.
The presentation of Non-GAAP Financial Measures should not be
construed as an inference that future results will be unaffected by
unusual or recurring items.
The Company defines adjusted EBITDA as net income adjusted to
exclude (i) interest expense, net, (ii) depreciation and
amortization (iii) income taxes and (iv) share-based compensation,
as further adjusted to eliminate the impact of certain items that
the Company does not consider indicative of its ongoing operating
performance. Adjusted EBITDA has limitations as an analytical tool,
and you should not consider it in isolation, or as a substitute for
analysis of the Company's results as reported under GAAP. For
example, adjusted EBITDA:
- does not reflect the Company's capital expenditures, future
requirements for capital expenditures or contractual
commitments;
- does not reflect changes in, or cash requirements for, the
Company's working capital needs;
- does not reflect the significant interest expense, or the cash
requirements necessary to service interest or principal payments,
on the Company's debt; and
- does not reflect payments related to income taxes, the Tax
Receivable Agreement or distributions to the non-controlling
interest to reimburse its tax liability.
HOSTESS BRANDS, INC.
RECONCILIATION OF NON-GAAP
FINANCIAL MEASURES
(Unaudited, amounts in
thousands, except shares and per share data)
Three Months Ended June 30,
2020
Net Revenue
Gross Profit
Operating Income
Net Income
Diluted EPS
GAAP Results
$
256,226
$
89,374
$
34,575
$
17,370
$
0.13
Non-GAAP adjustments:
Foreign currency impacts
—
—
—
710
0.01
Acquisition, disposal and integration
related costs (1)
6,821
6,943
12,360
12,360
0.09
COVID-19 Costs (2)
—
1,831
2,138
2,138
0.02
Other
—
—
(46
)
381
—
Tax impact of adjustments
—
—
—
(3,722
)
(0.03
)
Adjusted Non-GAAP results
$
263,047
$
98,148
$
49,027
29,237
$
0.22
Income tax
9,215
Interest expense
10,580
Depreciation and amortization
13,656
Share-based compensation
2,425
Adjusted EBITDA
$
65,113
(1) Acquisition, disposal and integration
operating costs include $1.6 million of selling expenses and $3.9
million of general and administrative expenses on the consolidated
statement of operations.
(2) COVID-19 operating costs are included
in general and administrative expenses on the consolidated
statement of operations. Total COVID-19 non-GAAP adjustments
primarily consist of costs of incremental cleaning and sanitation,
personal protective equipment and employee bonuses.
Three Months Ended June 30,
2019
Net Revenue
Gross Profit
Operating Income
Net Income
Diluted EPS
GAAP Results
$
241,060
$
83,450
$
36,881
$
16,669
$
0.10
Non-GAAP adjustments:
Special employee incentive compensation
(1)
—
—
1,555
1,555
0.01
Facility transition costs (1)
—
—
816
816
0.01
Tax Receivable Agreement remeasurement
—
—
1,278
1,278
0.01
Impairment of property and equipment,
intangible assets and goodwill
—
—
1,005
1,005
0.01
Other
—
—
—
840
0.01
Remeasurement of deferred taxes
—
—
—
2,823
0.03
Tax impact of adjustments
—
—
—
(928
)
(0.01
)
Adjusted Non-GAAP results
$
241,060
$
83,450
$
41,535
$
24,058
$
0.17
Income tax
7,169
Interest expense
10,302
Depreciation and amortization
11,060
Share-based compensation
2,499
Adjusted EBITDA
$
55,088
(1) Special employee incentive
compensation and facility transition operating costs are included
in general and administrative expenses on the consolidated
statement of operations.
Six Months Ended June 30,
2020
Net Revenue
Gross Profit
Operating Income
Net Income
Diluted EPS
GAAP Results
$
499,711
$
168,711
$
49,742
$
20,010
$
0.15
Non-GAAP adjustments:
Foreign currency impacts
—
—
—
996
0.01
Acquisition, disposal and integration
related costs (1)
6,821
7,963
27,446
27,301
0.21
Facility transition costs
—
3,681
5,711
5,711
0.04
COVID-19 Costs (2)
—
2,082
2,388
2,388
0.02
Other
—
—
(20
)
674
—
Tax impact of adjustments
—
—
—
(9,236
)
(0.07
)
Adjusted Non-GAAP results
$
506,532
$
182,437
$
85,267
$
47,844
$
0.36
Income tax
14,977
Interest expense
22,305
Depreciation and amortization
26,477
Share-based compensation
4,502
Adjusted EBITDA
$
116,105
(1) Acquisition, disposal and integration
operating costs include $8.0 million of selling expense, $7.2
million of general and administrative expenses and $4.3 million of
business combination transaction costs on the consolidated
statement of operations.
(2) COVID-19 operating costs are included
in general and administrative expenses on the consolidated
statement of operations. Total COVID-19 non-GAAP adjustments
primarily consist of costs of incremental cleaning and sanitation,
personal protective equipment and employee bonuses.
Six Months Ended June 30,
2019
Net Revenue
Gross Profit
Operating Income
Net Income
Diluted EPS
GAAP Results
$
463,798
$
158,638
$
72,991
$
43,281
$
0.31
Non-GAAP adjustments:
Acquisition, disposal and integration
related costs
—
—
—
1,563
0.01
Special employee incentive compensation
(1)
—
33
1,877
1,910
0.01
Facility transition costs (1)
—
1,563
2,412
816
0.01
Tax Receivable Agreement remeasurement
—
—
(483
)
(483
)
(0.01
)
Impairment of property and equipment,
intangible assets and goodwill
—
—
1,005
1,005
0.01
Other
—
—
—
1,280
0.01
Remeasurement of deferred taxes
—
—
—
(3,224
)
(0.03
)
Tax impact of adjustments
—
—
—
(1,337
)
(0.01
)
Adjusted Non-GAAP results
$
463,798
$
160,234
$
77,802
$
44,811
$
0.31
Income tax
12,447
Interest expense
20,538
Depreciation and amortization
21,939
Share-based compensation
4,780
Adjusted EBITDA
$
104,515
(1) Special employee incentive
compensation and facility transition operating costs are included
general and administrative expenses on the consolidated statement
of operations.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200805005951/en/
Investors, please contact: Katie Turner ICR 646-277-1228
katie.turner@icrinc.com Media, please contact: Hannah Arnold LAK
Public Relations, Inc. 212-329-1417 harnold@lakpr.com or Marie
Espinel LAK Public Relations, Inc. 212-899-4744
mespinel@lakpr.com
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