Raises Revenue Guidance for Full Year
2022
Thryv Holdings, Inc. (NASDAQ:THRY) (“Thryv” or the “Company”),
the small business platform for growing small and medium sized
businesses (“SMBs”), announced that it grew SaaS revenue 29%
year-over-year in Q1 of 2022 and is raising revenue guidance for
full year 2022.
“We are pleased to report a strong first quarter,” said Joe
Walsh, Chairman and CEO. “We saw an increase in revenue overall and
outstanding growth in our SaaS revenue, ahead of our SaaS revenue
guidance targets. In addition, we continue to drive new subscribers
and expect double-digit subscriber growth in 2022. These results
demonstrate that SMBs are starting the move to the cloud and
modernize the way they run their businesses.”
“We are seeing this shift in the U.S. and also in our
international operations, including our recent expansion to Canada.
In support of our international expansion, we recently announced
the hiring of Marie Caron as our President - International Markets.
Marie's experience and her leadership will be critical in fueling
our international expansion.”
“We also recently held a successful investor and analyst day in
New York City, where we shared a longer term vision for Thryv,
targeting $1 billion in SaaS revenue by 2027 and our plan for
achieving that goal,” said Walsh. “We view the next ten years as
the decade of cloud adoption by SMBs and we are well positioned to
lead the category.”
First Quarter 2022 Financial Highlights:
Revenue
- Total SaaS1 revenue was $48.2 million, a 29.3% increase
year-over-year
- Total Marketing Services revenue was $260.2 million, a 6.9%
increase year-over-year
- Consolidated total revenue was $308.4 million, an increase of
9.9% year-over-year
Profitability
- Consolidated net income was $33.5 million
- Consolidated Adjusted EBITDA2 was $83.7 million, representing
an Adjusted EBITDA margin of 27.1%
- Total SaaS3 Adjusted EBITDA loss was $6.8 million
- Total Marketing Services4 Adjusted EBITDA was $90.5 million,
representing an Adjusted EBITDA margin of 34.8%
- Consolidated Gross Profit was $197.9 million, an increase of
8.4% year-over-year
- Consolidated Adjusted Gross Profit5 was $207.7 million
- SaaS Adjusted Gross Profit6 was $30.4 million, representing an
Adjusted Gross Profit Margin of 64.2%
SaaS Metrics
- SaaS monthly Average Revenue per Unit (“ARPU”)7 increased to
$352 for the first quarter of 2022, compared to $304 in the first
quarter of 2021
- Total SaaS clients increased by 3 thousand to 47 thousand for
the first quarter of 2022
- Seasoned Net Dollar Retention8 was 93% at end of the first
quarter of 2022
- SaaS monthly active users9 increased 16% year-over-year to 36
thousand active users. Daily and weekly users increased 21%
year-over-year.
Outlook
Based on information available as of May 4, 2022, Thryv is
raising guidance10 for the second quarter of 2022 and full year
2022 as indicated below:
For the second quarter of 2022, the Company expects:
- Total SaaS revenue in a range of $50.5 to $51.0 million
- Total SaaS Adjusted EBITDA loss11 in a range of $6.0 to $6.5
million
- Total Marketing Services revenue in a range of $255 to $260
million
For the full year 2022, the Company currently expects:
- Total SaaS revenue in a range of $208 to $209 million
- Total SaaS Adjusted EBITDA loss11 in a range of $21 to $25
million
- Total Marketing Services revenue in a range of $905 to $920
million
- Total Marketing Services Adjusted EBITDA12 in a range of $315
to $320 million
Earnings Conference Call Information
Thryv will host a conference call on Wednesday, May 4, 2022 at
4:30 p.m. (Eastern Time) to discuss the Company's first quarter
results.
To register for this conference call, please use this link or
visit Thryv's Investor Relations website at investor.thryv.com.
After registering, a confirmation email will be sent, including
dial-in details and a unique code for entry. We recommend
registering a day in advance or at a minimum thirty minutes prior
to the start of the call. A live webcast will also be available on
the Investor Relations section of the Company's website at
investor.thryv.com.
If you are unable to participate in the conference call, a
replay will be available. To access the replay, please dial (800)
770-2030 or (647) 362-9199 and enter “87769.”
1
Total SaaS revenue in the U.S.
and International was $47.3 million and $0.8 million for the three
months ended March 31, 2022, respectively.
2
Adjusted EBITDA and Adjusted
EBITDA margin are non-GAAP financial measures. See “Non-GAAP
Measures” below for additional information.
3
Total SaaS Adjusted EBITDA loss
in the U.S. and International was $4.4 million and $2.4 million for
the three months ended March 31, 2022, respectively. Total SaaS
Adjusted EBITDA loss is a non-GAAP financial measure. See
“Supplemental Financial Information” below for more
information.
4
Total Marketing Services Adjusted
EBITDA in the U.S. and International was $66.4 million and $24.1
million for the three months ended March 31, 2022, respectively.
Total Marketing Services Adjusted EBITDA and Adjusted EBITDA margin
are non-GAAP financial measures. See “Supplemental Financial
Information” below for more information.
5
Adjusted Gross Profit is a
non-GAAP financial measure. See “Non-GAAP Measures" below for
additional information.
6
SaaS Adjusted Gross Profit and
Adjusted Gross Profit margin are non-GAAP financial measures. See
“Supplemental Financial Information” below for more
information.
7
Defined as total client billings
by month divided by the number of revenue-generating units during
the month.
8
Seasoned Net Dollar Retention is
defined as net dollar retention excluding clients acquired over the
previous 12 months.
9
Defined as a client with one or
more users who log into our SaaS solutions at least once during the
calendar month.
10
These statements are
forward-looking and actual results may materially differ. Refer to
the “Forward-Looking Statements” section below for information on
the factors that could cause our actual results to materially
differ from these forward-looking statements.
11
A reconciliation of Total SaaS
Adjusted EBITDA loss, a non-GAAP financial measure, to a
corresponding GAAP measure is not available on a forward-looking
basis without unreasonable efforts due to the unavailability of
reconciling information, including income tax expense and net
periodic pension cost.
12
A reconciliation of Total
Marketing Services Adjusted EBITDA, a non-GAAP financial measure,
to a corresponding GAAP measure is not available on a
forward-looking basis without unreasonable efforts due to the
unavailability of reconciling information, including income tax
expense and net periodic pension cost.
Final Results
Thryv Holdings, Inc. and
Subsidiaries
Consolidated Statements of
Operations and Comprehensive Income
Three Months Ended March
31,
(in thousands, except share and per share
data)
2022
2021
Revenue
$
308,375
$
280,606
Cost of services
110,519
98,160
Gross profit
197,856
182,446
Operating expenses:
Sales and marketing
93,955
76,540
General and administrative
52,194
41,279
Total operating expenses
146,149
117,819
Operating income
51,707
64,627
Other income (expense):
Interest expense
(13,108
)
(11,607
)
Interest expense, related party
(1,759
)
(4,065
)
Other components of net periodic pension
benefit (cost)
70
453
Other income (expense)
6,222
(1,093
)
Income before income tax
43,132
48,315
Income tax expense
(9,621
)
(11,809
)
Net income
$
33,511
$
36,506
Other comprehensive income (loss):
Foreign currency translation
adjustment
5,448
(2,967
)
Comprehensive income
$
38,959
$
33,539
Net income per common share:
Basic
$
0.98
$
1.10
Diluted
$
0.88
$
1.07
Weighted-average shares used in
computing basic and diluted net income per common share:
Basic
34,159,979
33,108,422
Diluted
37,957,685
34,013,480
Thryv Holdings, Inc. and
Subsidiaries
Consolidated Balance Sheets
(in thousands, except share data)
March 31, 2022
December 31, 2021
Assets
(unaudited)
Current assets
Cash and cash equivalents
$
21,446
$
11,262
Accounts receivable, net of allowance of
$17,702 in 2022 and $17,387 in 2021
305,729
279,053
Contract assets, net of allowance of $59
in 2022 and $88 in 2021
4,062
5,259
Taxes receivable
15,248
14,711
Prepaid expenses
43,112
22,418
Indemnification asset
24,746
24,346
Other current assets
14,572
13,596
Total current assets
428,915
370,645
Fixed assets and capitalized software,
net
49,965
50,938
Goodwill
673,713
671,886
Intangible assets, net
77,457
82,577
Deferred tax assets
108,912
90,565
Other assets
30,753
33,891
Total assets
$
1,369,715
$
1,300,502
Liabilities and Stockholders'
Equity
Current liabilities
Accounts payable
$
16,433
$
8,610
Accrued liabilities
146,350
131,813
Current portion of unrecognized tax
benefits
30,171
29,771
Contract liabilities
61,471
51,726
Current portion of long-term debt
70,000
70,000
Other current liabilities
18,114
15,214
Total current liabilities
342,539
307,134
Term Loan, net
375,422
309,672
Term Loan, related party
60,902
142,875
ABL Facility
62,975
39,929
Pension obligations, net
132,456
140,167
Deferred tax liabilities
7,374
10,798
Other liabilities
31,606
35,212
Total long-term liabilities
670,735
678,653
Commitments and contingencies
Stockholders' equity
Common stock - $0.01 par value,
250,000,000 shares authorized; 60,913,663 shares issued and
34,22,121 shares outstanding at March 31, 2022; and 60,830,853
shares issued and 34,145,311 shares outstanding at December 31,
2021
609
608
Additional paid-in capital
1,087,054
1,084,288
Treasury stock - 26,685,542 shares at
March 31, 2022 and 26,685,542 shares at December 31, 2021
(468,879
)
(468,879
)
Accumulated other comprehensive income
(loss)
(2,599
)
(8,047
)
Accumulated deficit
(259,744
)
(293,255
)
Total stockholders' equity
356,441
314,715
Total liabilities and stockholders'
equity
$
1,369,715
$
1,300,502
Thryv Holdings, Inc. and
Subsidiaries
Consolidated Statements of Cash
Flows
Three Months Ended March
31,
(in thousands)
2022
2021
Cash Flows from Operating
Activities
(unaudited)
(unaudited)
Net income
$
33,511
$
36,506
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization
21,969
19,718
Amortization of debt issuance costs
1,441
433
Deferred income taxes
(5,671
)
(13,249
)
Provision for credit losses and service
credits
5,467
6,546
Stock-based compensation expense
1,928
1,971
Other components of net periodic pension
(benefit)
(70
)
(453
)
Loss on foreign currency exchange
rates
1,077
835
Bargain purchase gain
(7,297
)
—
Other
1,440
320
Changes in working capital items,
excluding acquisitions:
Accounts receivable
(12,361
)
26,846
Contract assets
1,285
1,446
Prepaid expenses and other assets
(6,920
)
(10,998
)
Accounts payable and accrued
liabilities
(9,775
)
(57,861
)
Other liabilities
3,303
2,144
Net cash provided by operating
activities
29,327
14,204
Cash Flows from Investing
Activities
Additions to fixed assets and capitalized
software
(3,999
)
(3,668
)
Acquisition of a business, net of cash
acquired
(22,003
)
(174,190
)
Net cash (used in) investing
activities
(26,002
)
(177,858
)
Cash Flows from Financing
Activities
Proceeds from Term Loan
—
418,070
Proceeds from Term Loan, related party
—
260,930
Payments of Term Loan
(15,444
)
—
Payments of Term Loan, related party
(2,056
)
—
Payments of Senior Term Loan
—
(335,821
)
Payments of Senior Term Loan, related
party
—
(113,789
)
Proceeds from ABL Facility
302,374
249,936
Payments of ABL Facility
(279,327
)
(285,492
)
Proceeds from exercises of stock options
and stock warrants
839
1,560
Other
—
(3,598
)
Net cash provided by financing
activities
6,386
191,796
Effect of exchange rate changes on cash
and cash equivalents
541
(707
)
Increase in cash and cash equivalents and
restricted cash
10,252
27,435
Cash and cash equivalents and restricted
cash, beginning of period
13,557
2,406
Cash and cash equivalents and restricted
cash, end of period
$
23,809
$
29,841
Supplemental Information
Cash paid for interest
$
11,966
$
17,286
Cash paid for income taxes, net
$
15,421
$
15,753
Three Months Ended March
31,
Change
2022
2021
Amount
%
(in thousands of $)
Revenue
Marketing Services
$
212,533
$
227,933
$
(15,400
)
(6.8
) %
SaaS
47,343
37,251
10,092
27.1
%
Thryv International(1)
48,499
15,422
33,077
214.5
%
Consolidated Revenue
$
308,375
$
280,606
$
27,769
9.9
%
Marketing Services
$
136,510
$
156,161
$
(19,651
)
(12.6
) %
SaaS
29,409
23,167
6,242
26.9
%
Thryv International(1)
31,937
3,118
28,819
924.3
%
Segment Gross Profit
$
197,856
$
182,446
$
15,410
8.4
%
Segment EBITDA
Marketing Services
$
66,395
$
98,631
$
(32,236
)
(32.7
) %
SaaS
(4,364
)
316
(4,680
)
(1,481.0
) %
Thryv International (1)
21,686
5,986
15,700
262.3
%
Consolidated Adjusted EBITDA
$
83,717
$
104,933
$
(21,216
)
(20.2
) %
(1)
Thryv International includes
Thryv Australia revenue subsequent to the March 1, 2021 acquisition
date.
Non-GAAP Measures
Our results included in this press release include Adjusted
EBITDA, Adjusted EBITDA margin and Adjusted Gross Profit, which are
not presented in accordance with U.S. generally accepted accounting
principles (“GAAP”). These non-GAAP measures are presented for
supplemental informational purposes only and are not intended to be
considered in isolation or as a substitute for, or superior to,
financial information prepared and presented in accordance with
GAAP. Please refer to the supplemental information presented in the
tables below for a reconciliation of Adjusted EBITDA to Net income
and Adjusted Gross Profit to Gross profit. Both Net income and
Gross profit are the most comparable GAAP financial measure to
Adjusted EBITDA and Adjusted Gross Profit, respectively. Adjusted
EBITDA margin is defined as Adjusted EBITDA divided by revenue.
We believe that these non-GAAP financial measures provide useful
information about our financial performance, enhance the overall
understanding of our past performance and allow for greater
transparency with respect to important metrics used by our
management for financial and operational decision-making. We
believe that these measures provide additional tools for investors
to use in comparing our core financial performance over multiple
periods with other companies in our industry. However, it is
important to note that the particular items we exclude from, or
include in, our non-GAAP financial measures may differ from the
items excluded from, or included in, similar non-GAAP financial
measures used by other companies in the same industry.
The following is a reconciliation of Adjusted EBITDA to its most
directly comparable GAAP measure, Net income:
Three Months Ended March
31,
(in thousands)
2022
2021
Reconciliation of Adjusted
EBITDA
Net income
$
33,511
$
36,506
Interest expense
14,867
15,672
Income tax expense
9,621
11,809
Depreciation and amortization expense
21,969
19,718
Loss on early extinguishment of debt
—
299
Restructuring and integration expenses
(1)
5,827
9,234
Transaction costs (2)
1,720
10,546
Stock-based compensation expense (3)
1,928
1,971
Other components of net periodic pension
(benefit) cost (4)
(70
)
(453
)
Non-cash (gain) from remeasurement of
indemnification asset (5)
(400
)
—
Other (6)
(5,256
)
(369
)
Adjusted EBITDA
$
83,717
$
104,933
(1)
For the three months ended March
31, 2022 and 2021, expenses relate to periodic efforts to enhance
efficiencies and reduce costs, and include severance benefits, loss
on disposal of fixed assets and capitalized software, and costs
associated with abandoned facilities and system consolidation.
(2)
Expenses related to our direct
listing, Thryv Australia and Vivial acquisitions and other
transaction costs.
(3)
We record stock-based
compensation expense related to the amortization of grant date fair
value of the Company’s stock-based compensation awards.
Additionally, stock-based compensation expense includes the
remeasurement of these awards at each period end, prior to October
1, 2020.
(4)
Other components of net periodic
pension cost is from our non-contributory defined benefit pension
plans that are currently frozen and incur no additional service
costs. The most significant component of other components of net
periodic pension cost relates to the mark-to-market pension
remeasurement.
(5)
In connection with the YP
Acquisition, the seller indemnified us for future potential losses
associated with certain federal and state tax positions taken in
tax returns filed by the seller prior to the acquisition date.
(6)
Other primarily includes expenses
related to potential non income-based tax liabilities.
Additionally, during the three months ended March 31, 2022, Other
includes the bargain purchase gain as a result of the Vivial
Acquisition and foreign exchange-related expense.
The following is a reconciliation of Adjusted Gross Profit, to
its most directly comparable GAAP measure, Gross profit:
Three Months Ended March 31,
2022
(in thousands)
Marketing Services
SaaS
International
Consolidated
Reconciliation of Adjusted Gross
Profit
Gross profit
$
136,510
$
29,409
$
31,937
$
197,856
Plus:
Depreciation and amortization expense
4,395
979
4,442
9,816
Stock-based compensation expense
61
15
—
76
Adjusted Gross Profit
$
140,966
$
30,403
$
36,379
$
207,748
Gross Margin
64.2
%
62.1
%
65.9
%
64.2
%
Adjusted Gross Margin
66.3
%
64.2
%
75.0
%
67.4
%
Three Months Ended March 31,
2021
(in thousands)
Marketing Services
SaaS
International
Consolidated
Reconciliation of Adjusted Gross
Profit
Gross profit
$
156,161
$
23,167
$
3,118
$
182,446
Plus:
Depreciation and amortization expense
4,619
755
5,870
11,244
Stock-based compensation expense
70
11
—
81
Adjusted Gross Profit
$
160,850
$
23,933
$
8,988
$
193,771
Gross Margin
68.5
%
62.2
%
20.2
%
65.0
%
Adjusted Gross Margin
70.6
%
64.2
%
58.3
%
69.1
%
Supplemental Financial Information
The following supplemental financial information provides
Revenue, Adjusted EBITDA and Adjusted EBITDA Margin by (i)
Marketing Services businesses in the U.S., International and in
Total and (ii) SaaS businesses in the U.S., International and in
Total. Total SaaS Adjusted EBITDA and Adjusted EBITDA margin are
non-GAAP financial measures. Total Marketing Services Adjusted
EBITDA and Adjusted EBITDA margin are also non-GAAP financial
measures. These non-GAAP financial measures are presented for
supplemental informational purposes only and are not intended to be
considered in isolation or as a substitute for, or superior to,
financial information prepared and presented in accordance with
GAAP. Please refer to the supplemental information presented in the
tables below for a reconciliation of these non-GAAP financial
measures to the corresponding segment financial measures presented
in accordance with GAAP.
We believe that these non-GAAP financial measures provide useful
information about our global SaaS and Marketing Services financial
performance, enhance the overall understanding of our global SaaS
and Marketing Services past financial performance and allow for
greater transparency with respect to important metrics used by our
management for financial and operational decision-making. We
believe that these measures provide additional tools for investors
to use in comparing our core financial performance over multiple
periods.
Three Months Ended March 31,
2022
(in thousands)
Marketing Services
SaaS
US
International
Total
US
International
Total
Revenue
$
212,533
$
47,664
$
260,197
$
47,343
$
835
$
48,178
Adjusted EBITDA
66,395
24,097
90,492
(4,364
)
(2,411
)
(6,775
)
Adjusted EBITDA Margin
31.2
%
50.6
%
34.8
%
(9.2
) %
(288.7
) %
(14.1
) %
Three Months Ended March 31,
2021
(in thousands)
Marketing Services
SaaS
US
International
Total
US
International
Total
Revenue
$
227,933
$
15,422
$
243,355
$
37,251
$
—
$
37,251
Adjusted EBITDA
98,631
5,986
104,617
316
—
316
Adjusted EBITDA Margin
43.3
%
38.8
%
43.0
%
0.8
%
NM
0.8
%
Forward-Looking Statements
Certain statements contained herein are not historical facts,
constitute “forward-looking statements” within the meaning of the
Private Securities Litigation Reform Act of 1995 and involve a
number of risks and uncertainties. Statements that include the
words “may”, “will”, “could”, “should”, “would”, “believe”,
“anticipate”, “forecast”, “estimate”, “expect”, “preliminary”,
“intend”, “plan”, “target”, “project”, “outlook”, “future”,
“forward”, “guidance” and similar statements of a future or
forward-looking nature identify forward-looking statements. These
statements are not guarantees of future performance. These
forward-looking statements are based on our current expectations
and beliefs concerning future developments and their potential
effect on us. While management believes that these forward-looking
statements are reasonable as and when made, there can be no
assurance that future developments affecting us will be those that
we anticipate. Accordingly, there are or will be important factors
that could cause our actual results to differ materially from those
indicated in these statements. We believe that these factors
include, but are not limited to, the risks related to the
following: risks related to the ongoing COVID-19 pandemic, the
Company’s ability to maintain adequate liquidity to fund
operations; the Company’s future operating and financial
performance; the Company’s ability to consummate acquisitions, or,
if consummated, to successfully integrate acquired businesses into
the Company’s operations, the Company’s ability to recognize the
benefits of acquisitions, or the failure of an acquired company to
achieve its plans and objectives; limitations on our operating and
strategic flexibility and the ability to operate our business,
finance our capital needs or expand business strategies under the
terms of our credit facilities; our ability to retain existing
business and obtain and retain new business; general economic or
business conditions affecting the markets we serve; declining use
of print yellow page directories by consumers; our ability to
collect trade receivables from clients to whom we extend credit;
credit risk associated with our reliance on small and medium sized
businesses as clients; our ability to attract and retain key
managers; increased competition in our markets; our ability to
obtain future financing due to changes in the lending markets or
our financial position; our ability to maintain agreements with
major Internet search and local media companies; reduced
advertising spending and increased contract cancellations by our
clients, which causes reduced revenue; and our ability to
anticipate or respond effectively to changes in technology and
consumer preferences as well as the risks and uncertainties set
forth in the Company's most recent Annual Report on Form 10-K and
subsequent Quarterly Reports on From 10-Q filed with the Securities
and Exchange Commission. All subsequent written and oral
forward-looking statements attributable to us or persons acting on
our behalf are expressly qualified in their entirety by such
cautionary statements.
If one or more events related to these or other risks or
uncertainties materialize, or if our underlying assumptions prove
to be incorrect, actual results may differ materially from what we
anticipate. For these reasons, we caution you against relying on
forward-looking statements. All forward-looking statements included
in this press release are expressly qualified in their entirety by
the foregoing cautionary statements. These forward-looking
statements speak only as of the date hereof and, other than as
required by law, we undertake no obligation to publicly update or
revise any forward-looking statements, whether as a result of new
information, future events or otherwise.
About Thryv Holdings, Inc.
Thryv Holdings, Inc. (NASDAQ: THRY) is a global software and
marketing services company that empowers small- to medium-sized
businesses (“SMBs”), franchises and agencies to grow and modernize
their operations so they can compete and win in today's economy.
Over 46,000 businesses use our award-winning SaaS platform, Thryv®,
to manage their end-to-end customer experience, which has helped
businesses across the U.S. and overseas grow their bottom line.
Thryv also manages digital and print presence for over 400,000
businesses, connecting these SMBs to local consumers via
proprietary local search portals and print directories. For more
information about Thryv Holdings, Inc, visit thryv.com.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220504006096/en/
Media Contact: Charity Lacey Gregory FCA Office:
619.368.4373 thryv@gregoryfca.com
Investor Contact: Cameron Lessard Thryv, Inc.
214.773.7022 cameron.lessard@thryv.com
Thryv (NASDAQ:THRY)
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Thryv (NASDAQ:THRY)
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