WHITE PLAINS, N.Y.,
March 4, 2021 /PRNewswire/
-- Turtle Beach Corporation (Nasdaq: HEAR), a leading
gaming accessory business, reported financial results for the
fourth quarter and full year ended December
31, 2020.
2020 Full-Year Summary vs. 2019:
- Net revenue was $360.1 million
($357.9 million in constant
currency), an increase of 53% compared to $234.7 million;
- Net income of $38.7 million, or
$2.37 per diluted share, compared to
net income of $17.9 million, or
$1.04 per share, reflecting an
increase of 116% in net income and 127% in EPS;
- Adjusted EBITDA was $61.4
million, up 169% compared to $22.8
million; and
- Cash flow from operations was $51.0
million, up 29% compared to $39.4
million.
Fourth Quarter Summary vs. Year-Ago Quarter:
- Net revenue was $132.9 million
($131.2 million in constant currency)
versus $101.8 million;
- Net income of $16.3 million, or
$0.93 per diluted share, compared to
net income of $20.4 million, or
$1.29 per diluted share;
- Adjusted EBITDA was $23.6
million, compared to $16.6
million; and
- Cash flow from operations was $18.4
million, compared to $12.1
million.
"As indicated in our recent pre-announcement, our 2020 sales and
adjusted EBITDA were the highest in our company's history," said
Juergen Stark, Chairman and CEO,
Turtle Beach Corporation. "A great portfolio of products and our
leading brand combined with excellent operational execution enabled
us to outpace the rest of the console headset market as that market
experienced significant growth from both existing and new gamers
last year. That plus more than doubling our ROCCAT PC accessories
business both through expansion of the portfolio and further
development of that brand enabled us to deliver record results.
"While the gaming accessories market may slow a bit in 2021
because of how strong growth was in 2020, we expect that our
continued growth in PC accessories, as well as entry into new
categories will allow us to grow revenues to record levels in 2021.
And we plan to continue to invest in product and brand development
throughout 2021 to position ourselves for continued growth and
further expand our leadership position in gaming accessories."
2020 Financial Results
Net revenue in 2020 reached the highest level of annual sales in
Turtle Beach's history, at $360.1
million, up 53% compared to $234.7
million in 2019. The revenue increase was driven by strong
demand for gaming accessories among both new and existing gamers as
well non-gaming usage of headsets by people working and learning
from-home, especially following stay-at-home orders initiated in
March of last year. Quick reaction to rapid increases in demand,
excellent supply chain execution, and strong coordination with
retail partners globally contributed significantly to the Company's
ability to capture the surge in market demand. In addition, the
launches of new console video game console systems from Sony
PlayStation and Microsoft Xbox helped spark additional consumer
demand. The launch of new PC accessories led to a more than
doubling of sales of ROCCAT PC headsets, mice and keyboards. On a
constant currency basis, revenue in 2020 was $357.9 million.
Gross margin in 2020 was 37.2% compared to 33.5% in 2019. The
increase in gross margin was driven by significantly lower than
normal promotional spending due to strong demand and industrywide
supply constraints, a favorable business mix and better fixed cost
leverage, partially offset by higher air freight costs.
Operating expenses in 2020 were $84.6
million compared to $68.3
million in 2019 due primarily to sales and marketing costs
that drove revenue growth, R&D investments in new categories,
higher general and administrative costs resulting from the
inclusion of ROCCAT for the full year of 2020 and higher
performance-based expenses. As a percentage of net revenue,
operating expenses in 2020 were 23.5% compared to 29.1% in
2019.
Net income in 2020 was $38.7
million, or $2.37 per diluted
share, compared to $17.9 million or
$1.04 per diluted share in 2019.
Excluding a number of adjustments to net income in both periods (as
summarized below in Table 4), adjusted net income (as defined below
in "Non-GAAP Financial Measures") in 2020 was $36.3 million, or $2.22 per diluted share, compared to $11.6 million or $0.74 per diluted share, and increase of over
200%. The full-year weighted average diluted share count for 2020
was 16.4 million compared to 15.7 million in 2019.
Adjusted EBITDA (as defined below in "Non-GAAP Financial
Measures") in 2020 was $61.4 million
compared to $22.8 million in
2019.
Fourth Quarter 2020 Financial Results
Net revenue in the fourth quarter of 2020 was $132.9 million, up 31% compared to $101.8 million in the year-ago quarter. The
growth was strong across both console headsets as well as PC
accessories, and in all geographies. Drivers of this growth were
the same factors that drove the full-year increase in sales.
On a constant currency basis, revenue in the fourth quarter of 2020
was $131.2 million.
Gross margin in the fourth quarter of 2020 was 35.8% compared to
35.1% in the fourth quarter of 2019. The increase in gross margin
was the result of lower promotional spending, favorable business
mix and leverage of fixed operating costs, partially offset by
higher air freight costs.
Operating expenses in the fourth quarter of 2020 were
$27.6 million compared to
$22.3 million in the 2019 period due
primarily to sales and marketing costs that drove revenue growth
and increased R&D investments in new categories designed to
drive future growth. As a percentage of net revenue, operating
expenses in the fourth quarter of 2020 were 20.8% compared to 21.9%
in the fourth quarter of 2019.
Net income in the fourth quarter of 2020 was $16.3 million, or $0.93 per diluted share, compared to $20.4 million, or $1.29 per diluted share in the year-ago quarter.
Excluding a number of adjustments in both periods (as summarized
below in Table 4), adjusted net income (as defined below in
"Non-GAAP Financial Measures") in the fourth quarter of 2020 was
$14.8 million, or $0.84 per diluted share, compared to $13.0 million, or $0.83 per share, in the corresponding period in
2019. For the fourth quarter, the weighted average diluted share
count was 17.6 million for 2020 compared to 15.7 million for
2019. The year-over-year increase in the diluted share count
is primarily the result of lower assumed shares repurchased under
the treasury method for calculating diluted shares.
Adjusted EBITDA (as defined below in "Non-GAAP Financial
Measures") in the fourth quarter of 2020 was $23.6 million, an increase of 42% compared to
$16.6 million in the year-ago
quarter.
Balance Sheet and Cash Flow Highlights
At December 31, 2020, the Company
had $46.7 million of cash and cash
equivalents with no outstanding debt, including under its revolving
line of credit. This compares to $8.2
million of cash and cash equivalents with $15.7 million of outstanding debt under its
revolving credit facility at December 31,
2019, reflecting a $54 million
improvement in net cash. The company delivered cash flow from
operations of $51.0 million in 2020,
which marks the third consecutive year of at least $39 million of cash flow from operations.
2021
Outlook
For the full year 2021, the Company expects revenue to be
approximately $370 million reflecting
the target of continued growth from our 2020 record revenue levels.
Adjusted EBITDA is expected to be approximately $45 million, reflecting a category-leading target
of 12% EBITDA margin while enabling significant investments to
expand the Company's market share in the PC accessories market,
including the newly entered microphone market, and position the
company for continued growth. Adjusted net income per diluted share
is expected to be approximately $1.35.
For the first quarter of 2021, the Company expects revenue to be
approximately $88 million. Like 2020,
revenue phasing in 2021 is expected to be somewhat unusual, with a
higher percentage of full year revenue in the first quarter
compared to an unusually low percentage of revenue in the first
quarter of 2020. Adjusted EBITDA is expected to be approximately
$14.0 million. Adjusted net income
per diluted share is expected to be approximately $0.45.
Certain non-GAAP measures included in our financial outlook
were not reconciled to the comparable GAAP financial measures
because the GAAP measures are not accessible on a forward-looking
basis. We are unable to reconcile these forward looking non-GAAP
financial measures to the most directly comparable GAAP measures
without the investment of undue time, cost and other resources
because we are currently unable to predict with a reasonable degree
of certainty as a result of the variability, complexity, and lack
of visibility with respect to certain items that would be expected
to impact GAAP measures for these periods but would not impact the
non-GAAP measures. Such items may include other income (expense),
provision for income taxes and stock-based compensation and other
items. The unavailable information could be material to the
Company's actual results for such periods.
Conference Call Details
Turtle Beach Corporation will hold a conference call today,
March 4, 2021, at 2:00 p.m. Pacific Time (5:00 p.m. Eastern) to discuss its fourth quarter
and full year 2020 results.
CEO Juergen Stark and CFO
John Hanson will host the call,
followed by a question and answer session.
Conference Call Details:
Date:
Thursday, March 4, 2021
Time: 5:00 p.m. ET /
2:00 p.m. PT
Toll-Free Dial-in Number: (877) 303-9855
International Dial-in Number: (408) 337-0154
Conference ID: 6695389
For the conference call, please dial-in 5-10 minutes prior to
the start time and an operator will register your name and
organization. If you have any difficulty with the conference call,
please contact Gateway Investor Relations at (949) 574-3860.
The conference call will be broadcast live and available for
replay here and via the investor relations section of the Company's
website at www.turtlebeachcorp.com.
A replay of the conference call will be available after
8:00 p.m. ET on the same day through
March 11, 2021.
Toll-Free Replay Number: (855)
859-2056
International Replay Number: (404) 537-3406
Replay ID: 6695389
Non-GAAP Financial Measures
In addition to its reported results, the Company has included in
this earnings release certain financial results, including adjusted
EBITDA, adjusted net income, and constant currency revenue that the
Securities and Exchange Commission defines as "non-GAAP financial
measures." Management believes that such non-GAAP financial
measures, when read in conjunction with the Company's reported
results, can provide useful supplemental information for investors
analyzing period-to-period comparisons of the Company's results.
"Adjusted Net Income" is defined as net income excluding (i)
integration and transaction costs related to acquisitions, (ii) the
effect of the mark-to-market requirement of the financial
instrument obligation, (iii) any change in fair value of contingent
consideration and (iv) the release of valuation allowances on
deferred tax assets. "Adjusted EBITDA" is defined by the Company as
net income (loss) before interest, taxes, depreciation and
amortization, stock-based compensation (non-cash), and certain
non-recurring items that we believe are not representative of core
operations (e.g., the integration and transaction costs related to
the ROCCAT acquisition, the mark-to-market adjustment for the
financial instrument obligation and the change in fair value of
contingent consideration). "Constant currency revenue" is defined
by the Company as revenue excluding the impacts of fluctuations in
exchange rates from prior periods. These non-GAAP financial
measures are presented because management uses non-GAAP financial
measures to evaluate the Company's operating performance, to
perform financial planning, and to determine incentive
compensation. Therefore, the Company believes that the presentation
of non-GAAP financial measures provides useful supplementary
information to, and facilitates additional analysis by,
investors. The presented non-GAAP financial measures exclude
items that management does not believe reflect the Company's core
operating performance because such items are inherently unusual,
non-operating, unpredictable, non-recurring, or non-cash. See a
reconciliation of GAAP results to Adjusted Net Income and Adjusted
EBITDA included below for each of the three months and years ended
December 31, 2020 and 2019.
About Turtle Beach Corporation
Turtle Beach Corporation (https://corp.turtlebeach.com) is one
of the world's leading gaming accessory providers. The Turtle Beach
brand (www.turtlebeach.com) is known for pioneering first-to-market
features and patented innovations in high-quality, comfort-driven
headsets for all levels of gamer, making it a fan-favorite brand
and the market leader in console gaming audio for the last decade.
Turtle Beach's ROCCAT brand (www.roccat.org) combines detail-loving
German innovation with a genuine passion for designing the best PC
gaming products. Under the ROCCAT brand, Turtle Beach creates
award-winning keyboards, mice, headsets, mousepads, and other PC
accessories. Turtle Beach's Neat Microphones brand
(www.neatmic.com) creates high-quality USB and analog microphones
for gamers, streamers, and professionals that embrace cutting-edge
technology and design. Turtle Beach's shares are traded on the
Nasdaq Exchange under the symbol: HEAR.
Cautionary Note on Forward-Looking Statements
This press release includes forward-looking information and
statements within the meaning of the federal securities laws.
Except for historical information contained in this release,
statements in this release may constitute forward-looking
statements regarding assumptions, projections, expectations,
targets, intentions or beliefs about future events. Statements
containing the words "may", "could", "would", "should", "believe",
"expect", "anticipate", "plan", "estimate", "target", "goal",
"project", "intend" and similar expressions, or the negatives
thereof, constitute forward-looking statements. Forward-looking
statements involve known and unknown risks and uncertainties, which
could cause actual results to differ materially from those
contained in any forward-looking statement. Forward-looking
statements are based on management's current belief and
expectations, as well as assumptions made by, and information
currently available to, management.
While the Company believes that its expectations are based upon
reasonable assumptions, there can be no assurances that its goals
and strategy will be realized. Numerous factors, including risks
and uncertainties, may affect actual results and may cause results
to differ materially from those expressed in forward-looking
statements made by the Company or on its behalf. Some of these
factors include, but are not limited to, risks related to, the
substantial uncertainties inherent in the acceptance of existing
and future products, the difficulty of commercializing and
protecting new technology, the impact of competitive products and
pricing, general business and economic conditions, risks associated
with the expansion of our business including the integration of any
businesses we acquire and the integration of such businesses within
our internal control over financial reporting and operations, our
indebtedness, the Company's liquidity, and other factors discussed
in our public filings, including the risk factors included
in the Company's most recent Annual Report on Form 10-K,
Quarterly Report on Form 10-Q, and the Company's other
periodic reports. Except as required by applicable law, including
the securities laws of the United
States and the rules and regulations of the Securities and
Exchange Commission, the Company is under no obligation to publicly
update or revise any forward-looking statement after the date of
this release whether as a result of new information, future
developments or otherwise.
All trademarks are the property of their respective owners.
Turtle Beach
Corporation
|
Condensed
Consolidated Balance Sheets
|
(in thousands, except
par value and share amounts)
|
|
Table
1.
|
|
December 31,
|
|
|
December 31,
|
|
|
2020
|
|
|
2019
|
|
|
(unaudited)
|
|
ASSETS
|
(in thousands, except par value and share amounts)
|
|
Current
Assets:
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
46,681
|
|
|
$
|
8,249
|
|
Accounts receivable,
net
|
|
43,867
|
|
|
|
44,530
|
|
Inventories
|
|
71,301
|
|
|
|
45,711
|
|
Prepaid expenses and
other current assets
|
|
8,127
|
|
|
|
4,057
|
|
Total Current
Assets
|
|
169,976
|
|
|
|
102,547
|
|
Property and
equipment, net
|
|
6,575
|
|
|
|
3,962
|
|
Deferred income
taxes
|
|
6,946
|
|
|
|
7,439
|
|
Goodwill
|
|
8,178
|
|
|
|
8,515
|
|
Intangible assets,
net
|
|
5,138
|
|
|
|
6,011
|
|
Other
assets
|
|
6,640
|
|
|
|
2,877
|
|
Total
Assets
|
$
|
203,453
|
|
|
$
|
131,351
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
Current
Liabilities:
|
|
|
|
|
|
|
|
Revolving credit
facility
|
$
|
—
|
|
|
$
|
15,655
|
|
Accounts
payable
|
|
42,529
|
|
|
|
22,511
|
|
Other current
liabilities
|
|
36,122
|
|
|
|
26,422
|
|
Total Current
Liabilities
|
|
78,651
|
|
|
|
64,588
|
|
Deferred income
taxes
|
|
128
|
|
|
|
153
|
|
Other
liabilities
|
|
8,275
|
|
|
|
3,223
|
|
Total
Liabilities
|
|
87,054
|
|
|
|
67,964
|
|
Commitments and
Contingencies
|
|
|
|
|
|
|
|
Stockholders'
Equity
|
|
|
|
|
|
|
|
Common stock, $0.001
par value - 25,000,000 shares authorized; 15,475,504 and 14,488,152
shares issued and outstanding as of December 31, 2020 and 2019,
respectively
|
|
15
|
|
|
|
14
|
|
Additional paid-in
capital
|
|
190,568
|
|
|
|
176,776
|
|
Accumulated
deficit
|
|
(74,773)
|
|
|
|
(113,519)
|
|
Accumulated other
comprehensive income
|
|
589
|
|
|
|
116
|
|
Total Stockholders'
Equity
|
|
116,399
|
|
|
|
63,387
|
|
Total Liabilities and
Stockholders' Equity
|
$
|
203,453
|
|
|
$
|
131,351
|
|
Turtle Beach
Corporation
|
Condensed
Consolidated Statements of Operations
|
(in thousands, except
per-share data)
|
(unaudited)
|
|
Table
2.
|
|
Three Months
Ended
|
|
|
Twelve Months
Ended
|
|
|
December 31,
|
|
|
December 31,
|
|
|
December 31,
|
|
|
December 31,
|
|
|
2020
|
|
|
2019
|
|
|
2020
|
|
|
2019
|
|
Net
revenue
|
$
|
132,912
|
|
|
$
|
101,764
|
|
|
$
|
360,093
|
|
|
$
|
234,663
|
|
Cost of
revenue
|
|
85,272
|
|
|
|
66,052
|
|
|
|
226,305
|
|
|
|
155,950
|
|
Gross
profit
|
|
47,640
|
|
|
|
35,712
|
|
|
|
133,788
|
|
|
|
78,713
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling and
marketing
|
|
17,715
|
|
|
|
14,053
|
|
|
|
46,779
|
|
|
|
38,634
|
|
Research and
development
|
|
3,577
|
|
|
|
2,468
|
|
|
|
12,265
|
|
|
|
7,856
|
|
General and
administrative
|
|
6,345
|
|
|
|
5,739
|
|
|
|
25,577
|
|
|
|
21,796
|
|
Total operating
expenses
|
|
27,637
|
|
|
|
22,260
|
|
|
|
84,621
|
|
|
|
68,286
|
|
Operating
income
|
|
20,003
|
|
|
|
13,452
|
|
|
|
49,167
|
|
|
|
10,427
|
|
Interest
expense
|
|
112
|
|
|
|
334
|
|
|
|
467
|
|
|
|
929
|
|
Other non-operating
expense (income), net
|
|
(2,237)
|
|
|
|
(779)
|
|
|
|
(3,757)
|
|
|
|
(2,209)
|
|
Income before income
tax
|
|
22,128
|
|
|
|
13,897
|
|
|
|
52,457
|
|
|
|
11,707
|
|
Income tax expense
(benefit)
|
|
5,825
|
|
|
|
(6,489)
|
|
|
|
13,711
|
|
|
|
(6,237)
|
|
Net income
|
$
|
16,303
|
|
|
$
|
20,386
|
|
|
$
|
38,746
|
|
|
$
|
17,944
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income per
share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
$
|
1.07
|
|
|
$
|
1.41
|
|
|
$
|
2.62
|
|
|
$
|
1.24
|
|
Diluted
|
$
|
0.93
|
|
|
$
|
1.29
|
|
|
$
|
2.37
|
|
|
$
|
1.04
|
|
Weighted average
number of shares:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
15,272
|
|
|
|
14,501
|
|
|
|
14,801
|
|
|
|
14,483
|
|
Diluted
|
|
17,573
|
|
|
|
15,748
|
|
|
|
16,365
|
|
|
|
15,688
|
|
Turtle Beach
Corporation
|
Condensed
Consolidated Statements of Cash Flows
|
(in
thousands)
|
(unaudited)
|
|
Table
3.
|
|
Year
Ended
|
|
|
December 31,
2020
|
|
|
December 31,
2019
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM
OPERATING ACTIVITIES
|
$
|
51,049
|
|
|
$
|
39,374
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM
INVESTING ACTIVITIES
|
|
(5,663)
|
|
|
|
(14,579)
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM
FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
Borrowings on
revolving credit facilities
|
|
323,593
|
|
|
|
219,910
|
|
Repayment of revolving
credit facilities
|
|
(339,248)
|
|
|
|
(241,640)
|
|
Proceeds from sale of
equity securities
|
|
4,373
|
|
|
|
-
|
|
Proceeds from exercise
of stock options and warrants
|
|
4,195
|
|
|
|
330
|
|
Repurchase of common
stock
|
|
-
|
|
|
|
(2,525)
|
|
Repurchase of common
stock to satisfy employee tax withholding obligations
|
|
(325)
|
|
|
|
(255)
|
|
Net cash used for
financing activities
|
|
(7,412)
|
|
|
|
(24,180)
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
|
458
|
|
|
|
556
|
|
Net increase in cash
and cash equivalents
|
|
38,432
|
|
|
|
1,171
|
|
Cash and cash
equivalents - beginning of period
|
|
8,249
|
|
|
|
7,078
|
|
Cash and cash
equivalents - end of period
|
$
|
46,681
|
|
|
$
|
8,249
|
|
Turtle Beach
Corporation
|
Reconciliation of
GAAP and Non-GAAP Measures
|
(in thousands, except
per-share data)
|
(unaudited)
|
|
Table
4.
|
|
Three Months
Ended
|
|
|
Year
Ended
|
|
|
December
31,
2020
|
|
|
December
31,
2019
|
|
|
December
31,
2020
|
|
|
December
31,
2019
|
|
Net Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Net
Income
|
$
|
16,303
|
|
|
$
|
20,386
|
|
|
$
|
38,746
|
|
|
$
|
17,944
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments, net of
tax:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain on financial
instrument obligation
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(1,601)
|
|
Release of valuation
allowance
|
|
—
|
|
|
|
(7,439)
|
|
|
|
—
|
|
|
|
(7,439)
|
|
Gain on
acquisition-related settlement
|
|
—
|
|
|
|
—
|
|
|
|
(1,702)
|
|
|
|
—
|
|
Change in fair value
of contingent consideration
|
|
(1,631)
|
|
|
|
(422)
|
|
|
|
(1,121)
|
|
|
|
(422)
|
|
Acquisition
integration costs
|
|
124
|
|
|
|
499
|
|
|
|
405
|
|
|
|
3,154
|
|
Non-GAAP
Earnings
|
$
|
14,796
|
|
|
$
|
13,024
|
|
|
$
|
36,328
|
|
|
$
|
11,636
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted Earnings Per
Share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP-
Diluted
|
$
|
0.93
|
|
|
$
|
1.29
|
|
|
$
|
2.37
|
|
|
$
|
1.04
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain on financial
instrument obligation
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Release of valuation
allowance
|
|
—
|
|
|
|
(0.47)
|
|
|
|
—
|
|
|
|
(0.47)
|
|
Gain on
acquisition-related settlement
|
|
—
|
|
|
|
—
|
|
|
|
(0.10)
|
|
|
|
—
|
|
Change in fair value
of contingent consideration
|
|
(0.09)
|
|
|
|
(0.03)
|
|
|
|
(0.07)
|
|
|
|
(0.03)
|
|
Acquisition
integration costs
|
|
0.01
|
|
|
|
0.03
|
|
|
|
0.02
|
|
|
|
0.20
|
|
Non-GAAP-
Diluted
|
$
|
0.84
|
|
|
$
|
0.83
|
|
|
$
|
2.22
|
|
|
$
|
0.74
|
|
Turtle Beach
Corporation
|
GAAP to Adjusted
EBITDA Reconciliation
|
(in
thousands)
|
(unaudited)
|
|
Table
5.
|
|
Three Months
Ended
|
|
|
December 31,
2020
|
|
|
|
|
|
|
|
|
|
|
|
Adj
|
|
|
|
|
|
|
|
|
As
|
|
Adj
|
|
Adj
|
|
Stock
|
|
|
|
|
Adj
|
|
|
Reported
|
|
Depreciation
|
|
Amortization
|
|
Compensation
|
|
Other
(1)
|
|
EBITDA
|
|
Net
revenue
|
$
|
132,912
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
132,912
|
|
Cost of
revenue
|
|
85,272
|
|
|
(537)
|
|
|
-
|
|
|
(305)
|
|
|
-
|
|
|
84,430
|
|
Gross
Profit
|
|
47,640
|
|
|
537
|
|
|
-
|
|
|
305
|
|
|
-
|
|
|
48,482
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
27,637
|
|
|
(520)
|
|
|
(224)
|
|
|
(1,268)
|
|
|
(168)
|
|
|
25,457
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
|
20,003
|
|
|
1,057
|
|
|
224
|
|
|
1,573
|
|
|
168
|
|
|
23,025
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
112
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other non-operating
expense (income), net
|
|
(2,237)
|
|
|
|
|
|
|
|
|
|
|
|
1,631
|
|
|
(606)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income
tax
|
|
22,128
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
expense
|
|
5,825
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
$
|
16,303
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
$
|
23,631
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year
Ended
|
|
|
December 31,
2020
|
|
|
|
|
|
|
|
|
|
|
|
Adj
|
|
|
|
|
|
|
|
|
As
|
|
Adj
|
|
Adj
|
|
Stock
|
|
|
|
|
Adj
|
|
|
Reported
|
|
Depreciation
|
|
Amortization
|
|
Compensation
|
|
Other
(1)
|
|
EBITDA
|
|
Net
revenue
|
$
|
360,093
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
360,093
|
|
Cost of
revenue
|
|
226,305
|
|
|
(2,365)
|
|
|
-
|
|
|
(928)
|
|
|
-
|
|
|
223,012
|
|
Gross
Profit
|
|
133,788
|
|
|
2,365
|
|
|
-
|
|
|
928
|
|
|
-
|
|
|
137,081
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
84,621
|
|
|
(1,994)
|
|
|
(889)
|
|
|
(4,621)
|
|
|
(550)
|
|
|
76,567
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
|
49,167
|
|
|
4,359
|
|
|
889
|
|
|
5,549
|
|
|
550
|
|
|
60,514
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
467
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other non-operating
expense (income), net
|
|
(3,757)
|
|
|
|
|
|
|
|
|
|
|
|
2,823
|
|
|
(934)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income
tax
|
|
52,457
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
expense
|
|
13,711
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
$
|
38,746
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
$
|
61,448
|
|
|
|
(1)
|
Other includes
certain business acquisition costs, gain on an acquisition-related
settlement and change in fair value of contingent
consideration.
|
Turtle Beach
Corporation
|
GAAP to Adjusted
EBITDA Reconciliation
|
(in
thousands)
|
(unaudited)
|
|
Table 5.
(continued)
|
|
Three Months
Ended
|
|
|
December 31,
2019
|
|
|
|
|
|
|
|
|
|
|
|
Adj
|
|
|
|
|
|
|
|
|
As
|
|
Adj
|
|
Adj
|
|
Stock
|
|
|
|
|
Adj
|
|
|
Reported
|
|
Depreciation
|
|
Amortization
|
|
Compensation
|
|
Other
(2)
|
|
EBITDA
|
|
Net
revenue
|
$
|
101,764
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
101,764
|
|
Cost of
revenue
|
|
66,052
|
|
|
(601)
|
|
|
-
|
|
|
(74)
|
|
|
-
|
|
|
65,377
|
|
Gross
Profit
|
|
35,712
|
|
|
601
|
|
|
-
|
|
|
74
|
|
|
-
|
|
|
36,388
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
22,260
|
|
|
(478)
|
|
|
(229)
|
|
|
(929)
|
|
|
(555)
|
|
|
20,070
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
|
13,452
|
|
|
1,079
|
|
|
229
|
|
|
1,003
|
|
|
555
|
|
|
16,317
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
334
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other non-operating
expense (income), net
|
|
(780)
|
|
|
|
|
|
|
|
|
|
|
|
471
|
|
|
(309)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income
tax
|
|
13,897
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
benefit
|
|
(6,489)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
$
|
20,386
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
$
|
16,626
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year
Ended
|
|
|
December 31,
2019
|
|
|
|
|
|
|
|
|
|
|
|
Adj
|
|
|
|
|
|
|
|
|
As
|
|
Adj
|
|
Adj
|
|
Stock
|
|
|
|
|
Adj
|
|
|
Reported
|
|
Depreciation
|
|
Amortization
|
|
Compensation
|
|
Other
(2)
|
|
EBITDA
|
|
Net
revenue
|
$
|
234,663
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
234,663
|
|
Cost of
revenue
|
|
155,950
|
|
|
(1,950)
|
|
|
-
|
|
|
(150)
|
|
|
-
|
|
|
153,850
|
|
Gross
Profit
|
|
78,713
|
|
|
1,950
|
|
|
-
|
|
|
150
|
|
|
-
|
|
|
80,813
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
68,286
|
|
|
(2,606)
|
|
|
(642)
|
|
|
(3,408)
|
|
|
(3,516)
|
|
|
58,114
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
|
10,427
|
|
|
4,556
|
|
|
642
|
|
|
3,558
|
|
|
3,516
|
|
|
22,699
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
929
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other non-operating
expense (income), net
|
|
(2,209)
|
|
|
|
|
|
|
|
|
|
|
|
2,072
|
|
|
(137)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income
tax
|
|
11,707
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
benefit
|
|
(6,237)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
$
|
17,944
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
$
|
22,836
|
|
|
|
(2)
|
Other includes
certain business acquisition costs and a gain (loss) on financial
instrument obligation.
|
View original content to download
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SOURCE Turtle Beach Corporation