Whole Earth Brands, Inc. (the “Company” or “we” or “our”) (Nasdaq:
FREE), a global food company enabling healthier lifestyles
by providing access to premium plant-based sweeteners, flavor
enhancers and other foods through a diverse portfolio of trusted
brands and delicious products, today announced its financial
results for its second quarter ended June 30, 2021. The Company
also reiterated fiscal year 2021 guidance.
Irwin D. Simon, Executive Chairman, stated,
“Throughout my entire career I’ve been focused on making food
healthier and I’m excited about the opportunity we have at Whole
Earth Brands to bring ‘better-for-you’ foods to consumers across
the world. Our recent performance affirms that Whole Earth Brands
is unquestionably the leading global player in the ‘better-for-you’
sweetener and reduced sugar categories. We are poised to disrupt
those categories through the strength of our brand portfolio, our
track record of product innovation and distribution, our recent
strategic acquisitions that broaden our offerings, and a
best-in-class operational platform. I am confident in our ability
to take full advantage of the substantial growth opportunity we
have ahead.”
Albert Manzone, Chief Executive Officer,
commented, “We are on a mission to make sweet healthy through
disrupting a massive $100 billion market that’s dominated by
refined sugar. Today, penetration of sugar substitutes is at its
infancy, representing approximately 3% of a $100 billion global
market. The successful first quarter integration of our Swerve and
Wholesome acquisitions has generated notable momentum as we focus
on growing our global brand portfolio and further strengthening
operations across the Company. We believe the second quarter 2021
15% two-year stacked growth rate in our Branded CPG Segment is
indicative of the potential of the business. We are proud of our
best-in-class global supply chain and have recently completed our
Flavors & Ingredients segment’s footprint optimization project
with the sale of our Camden, New Jersey facility. Additionally, our
Branded CPG North America supply chain reinvention project reached
a milestone with the opening of a new facility in Decatur, Alabama
which is driving efficiencies and long-term margin enhancement.
Together with the execution of several levers, including pricing,
trade spend optimization, and productivity, these supply chain
initiatives are helping us offset inflation.”
SECOND QUARTER 2021
HIGHLIGHTS
Our consolidated financials reflect both
predecessor and successor periods indicative of the June 25, 2020
business combination date. The second quarter results discussed
below compare the successor’s 2021 second quarter results ended
June 30, 2021 to the combined 2020 second quarter results which
includes the successor period from June 26, 2020 through June 30,
2020 and the predecessor period from April 1, 2020 through June 25,
2020.
We completed the acquisition of Swerve on
November 10, 2020 and the Wholesome acquisition on February 5, 2021
and our reported results include Swerve and Wholesome from those
respective dates onwards.
- Consolidated
product revenues were $126.5 million, an increase of 89.3% on a
reported basis and an increase of 84.8% on a constant currency
basis, as compared to the prior year second quarter. On a proforma
basis, including the impact of both acquisitions for the quarter in
both the current and prior year periods, organic product revenue
decreased 1.4%, or decreased 3.8% on a constant currency basis,
compared to the prior year second quarter driven by 2020 one-time
pantry loading at the onset of COVID.
- Reported gross
profit was $41.4 million, compared to $26.6 million in the prior
year second quarter, and gross profit margin was 32.7% in the
second quarter of 2021, compared to 39.8% in the prior year period.
Gross profit results were positively influenced by $11.0 million of
contributions from the Swerve and Wholesome acquisitions, revenue
growth from the legacy Branded CPG and Flavors & Ingredients
segments and productivity gains. The decline in gross profit margin
was driven primarily by the inclusion of Wholesome’s private label
business.
- Adjusted gross
profit margin, when adjusting for all non-cash and cash
adjustments, was 34.0% down from 41.2% in the prior year driven
primarily by the inclusion of Wholesome‘s private label
business.
- Consolidated
operating income was $6.0 million compared to an operating loss of
$5.2 million in the prior year and consolidated net income was $3.7
million in the second quarter of 2021 compared to a net loss of
$6.0 million in the prior year period.
- Consolidated
Adjusted EBITDA increased 94.9% to $22.0 million driven by
contributions from the Swerve and Wholesome acquisitions, revenue
growth and productivity gains, partially offset by public company
costs.
SEGMENT RESULTS
Branded CPG SegmentBranded CPG
segment product revenues increased $56.0 million, or 130.0%, to
$99.1 million for the second quarter of 2021, compared to $43.1
million for the same period in the prior year. On a constant
currency basis, product revenues increased 123.1% driven by the
addition of Swerve and Wholesome revenue, which was not comparable
to the prior year period. Constant currency results reflect the
strong growth in our natural brands. On a proforma basis, including
the impact of both acquisitions in the current and prior year
periods, organic constant-currency product revenue decreased 8.1%,
compared to the prior year second quarter. The decline was driven
by one-time pantry loading in 2020 at the onset of COVID, partially
offset by growth in the U.S. foodservice channel. On a two-year
stacked basis, when comparing second quarter 2021 to second quarter
2019, Branded CPG segment proforma organic constant currency
revenue increased 15%.
Operating income on a GAAP basis was $10.3
million in the second quarter of 2021 compared to operating income
of $1.8 million for the same period in the prior year. The increase
of $8.5 million was driven by contributions from the acquired
Swerve and Wholesome businesses, revenue growth and productivity
gains within the segment.
Flavors & Ingredients
SegmentFlavors & Ingredients segment product revenues
increased 15.3% to $27.4 million for the second quarter of 2021,
compared to $23.8 million for the same period in the prior year.
The increase was driven by growth across most of the product lines
and a favorable comparison in the prior year where the business
realized a surge in product orders in March 2020 related to
COVID-19, which reduced revenues in the second quarter of 2020.
Operating income was $3.7 million in the second
quarter of 2021, compared to $0.1 million in the prior year period.
The increase was driven primarily by revenue growth.
CorporateCorporate expenses for
the second quarter of 2021 were $8.0 million, compared to $7.0
million of Corporate expenses in the prior year. Corporate expenses
increased $1.0 million, primarily driven by increased public
company costs and stock-based compensation, partially offset by
transaction related expenses of $4.5 million in 2020.
YEAR-TO-DATE 2021
HIGHLIGHTS
Our consolidated financials reflect both
predecessor and successor periods indicative of the June 25, 2020
business combination date. The year-to-date results discussed below
compare the results for the six months ended June 30, 2021 to the
combined six months ended June 30, 2020, which includes the
successor period from June 26, 2020 through June 30, 2020 and the
predecessor period from January 1, 2020 through June 25, 2020.
We completed the acquisition of Swerve on
November 10, 2020 and the Wholesome acquisition on February 5,
2021. Our reported results include Swerve and Wholesome from those
respective dates onwards.
-
Consolidated product revenues were $232.3 million, an increase of
74.9% compared to June year-to-date 2020 and, on a constant
currency basis, an increase of 71.1%. On a proforma basis,
including the impact of both acquisitions for the full six month
periods ended June 30, 2021 and June 30, 2020, organic product
revenue increased 3.0%, or increased 0.9% on a constant currency
basis, compared to the prior year.
-
Branded CPG segment product revenues were $180.9 million, an
increase of 117.2% or 111.0% on a constant currency basis. Constant
currency results reflect the acquisitions of Wholesome and Swerve
and growth in our natural brands. On a proforma basis, including
the impact of both acquisitions for the full six month periods
ended June 30, 2021 and June 30, 2020, organic constant-currency
product revenues increased 0.2%, compared to the prior year period.
On a two-year stacked basis, when comparing the first half of 2021
to the first half of 2019, Branded CPG segment proforma organic
constant currency revenue increased 11.5%. Operating income was
$20.4 million compared to an operating loss of $5.0 million in the
prior year period. The increase was due to an $11.1 million
goodwill asset impairment charge in the prior year, $7.9 million of
contributions from the acquired Swerve and Wholesome businesses,
revenue growth and productivity gains.
-
Flavors & Ingredients segment product revenues were $51.4
million, an increase of 3.9% as compared to the prior year period.
The increase was driven by growth in derivatives. Operating income
for the six months ended June 30, 2021 was $4.7 million, compared
to an operating loss of $23.9 million in the prior year period. The
$28.6 million increase was primarily driven by asset impairment
charges totaling $29.5 million recorded in the first quarter of
2020 and transaction related expenses of $3.8 million also recorded
in 2020 and revenue growth, partially offset by $4.5 million of
facility closure and restructuring costs and a $1.9 million
increase in amortization expense due to purchase accounting
revaluations of intangible assets.
-
Reported gross profit was $77.0 million, an increase of $24.5
million from $52.5 million in the prior year period, and gross
profit margin was 33.1% in the six months ended June 30, 2021, down
from 39.5% in the prior year period.
-
Adjusted gross profit margin, when adjusting for all adjustments,
was 35.3%, down from 41.5% in the prior year period driven
primarily by Wholesome’s private label business.
-
Consolidated operating income was $2.9 million compared to an
operating loss of $38.5 million in the prior year and consolidated
net loss was $8.3 million for the six months ended June 30, 2021
compared to a net loss of $34.6 million in the prior year period.
The improvement was largely due to the non-cash asset impairment
charges recorded in 2020, the positive impact of acquisitions and
lower transaction related costs.
- Consolidated
Adjusted EBITDA increased 64.9% to $39.4 million driven by
contributions from the acquired Swerve and Wholesome businesses,
revenue growth and productivity, partially offset by increased
public company costs.
CASH FLOW & BALANCE
SHEET
Cash used in operating activities was $9.5
million and capital expenditures were $4.6 million during the first
half of 2021. As of June 30, 2021 the Company had cash and cash
equivalents of $24.1 million and $384.7 million of long-term debt,
net of unamortized debt issuance costs.
Reducing balance sheet leverage is a corporate
priority and the Company estimates that it will achieve a ratio of
Net Debt to Adjusted EBITDA of approximately 4.0x by December 31,
2021.
OUTLOOK
The Company is reiterating its outlook for full
year 2021, which includes the impact of its recent acquisitions of
Swerve and Wholesome. The outlook includes expectations for growth
on a proforma organic basis and margins for the combined business.
The Company defines proforma organic growth to be as if the Company
owned both Swerve and Wholesome for the full years 2020 and 2021.
The Company’s 2021 outlook is as follows:
- Net Product Revenues: $493 million
to $505 million (representing reported growth of greater than 78%,
and proforma organic growth of 3% to 5%)
- Adjusted Gross Profit Margin: 34%
to 35% of product revenues
- Adjusted EBITDA Margin:
Approximately 17% of product revenues
- Adjusted EBITDA: $82 million to $85
million (representing reported growth of greater than 50%, and
proforma organic growth of 3% to 5%)
- Capital Expenditures: $10 million
to $12 million
- Tax Rate: Approximately 7% on a
GAAP basis due to one-time discrete favorable items
CONFERENCE CALL DETAILS
The Company will host a conference call and
webcast to review its second quarter results today, Monday, August
9, 2021 at 8:30am EDT. The conference call can be accessed live
over the phone by dialing (877) 705-6003 or for international
callers by dialing (201) 493-6725. A replay of the call will be
available through August 23, 2021 by dialing (844) 512-2921 or for
international callers by dialing (412) 317-6671; the passcode is
13720916.
The live audio webcast of the conference call
will be accessible in the News & Events section on the
Company's Investor Relations website at
investor.wholeearthbrands.com. An archived replay of the webcast
will also be available shortly after the live event has
concluded.
About Whole Earth Brands
Whole Earth Brands is a global food company
enabling healthier lifestyles and providing access to premium
plant-based sweeteners, flavor enhancers and other foods through
our diverse portfolio of trusted brands and delicious products,
including Whole Earth Sweetener®, Wholesome®, Swerve®, Pure Via®,
Equal® and Canderel®. With food playing a central role in people’s
health and wellness, Whole Earth Brands’ innovative product
pipeline addresses the growing consumer demand for more dietary
options, baking ingredients and taste profiles. Our world-class
global distribution network is the largest provider of plant-based
sweeteners in more than 100 countries with a vision to expand
our portfolio to responsibly meet local preferences. We
are committed to helping people enjoy life’s everyday moments and
the celebrations that bring us together. For more information on
how we “Open a World of Goodness®,” please visit
www.WholeEarthBrands.com.
Forward-Looking Statements
This press release contains forward-looking
statements (including within the meaning of the Private Securities
Litigation Reform Act of 1995) concerning Whole Earth Brands, Inc.
and other matters. These statements may discuss goals, intentions
and expectations as to future plans, trends, events, results of
operations or financial condition, or otherwise, based on current
beliefs of management, as well as assumptions made by, and
information currently available to, management.
Forward-looking statements may be accompanied by
words such as “achieve,” “aim,” “anticipate,” “believe,” “can,”
“continue,” “could,” “drive,” “estimate,” “expect,” “forecast,”
“future,” “guidance,” “grow,” “improve,” “increase,” “intend,”
“may,” “outlook,” “plan,” “possible,” “potential,” “predict,”
“project,” “should,” “target,” “will,” “would,” or similar words,
phrases or expressions. Examples of forward-looking statements
include, but are not limited to, the statements made by Messrs.
Simon and Manzone, the ability of the Company to achieve its ratio
of Net Debt to Adjusted EBITDA, and our 2021 guidance. Factors that
could cause actual results to differ materially from those in the
forward-looking statements include, but are not limited to, the
Company’s ability to achieve the anticipated benefits of the
integration of Wholesome and Swerve in a timely manner or at all;
the extent of the impact of the COVID-19 pandemic, including the
duration, spread, severity, and any recurrence of the COVID-19
pandemic, the duration and scope of related government orders and
restrictions, the impact on our employees, and the extent of the
impact of the COVID-19 pandemic on overall demand for the Company’s
products; local, regional, national, and international economic
conditions that have deteriorated as a result of the COVID-19
pandemic, including the risks of a global recession or a recession
in one or more of the Company’s key markets, and the impact they
may have on the Company and its customers and management’s
assessment of that impact; extensive and evolving government
regulations that impact the way the Company operates; and the
impact of the COVID-19 pandemic on the Company’s suppliers,
including disruptions and inefficiencies in the supply chain.
These forward-looking statements are subject to
risks, uncertainties and other factors, many of which are outside
of the Company’s control, which could cause actual results to
differ materially from the results contemplated by the
forward-looking statements. These statements are subject to the
risks and uncertainties indicated from time to time in the
documents the Company files (or furnishes) with the U.S. Securities
and Exchange Commission.
You are cautioned not to place undue reliance
upon any forward-looking statements, which are based only on
information currently available to the Company and speak only as of
the date made. The Company undertakes no commitment to publicly
update or revise the forward-looking statements, whether written or
oral that may be made from time to time, whether as a result of new
information, future events or otherwise, except as required by
law.
Contacts:Investor Relations
Contact:Whole Earth
Brands312-840-5001investor@wholeearthbrands.com
ICRJeff
Sonnek646-277-1263jeff.sonnek@icrinc.com
Media Relations Contact:Wyecomm Penny
Kozakos202-390-4409Penny.Kozakos@wyecomm.com
Whole Earth Brands, Inc. |
Condensed Consolidated Balance Sheets |
(In thousands of dollars, except for share and per share
data) |
(Unaudited) |
|
|
|
|
|
June 30, 2021 |
|
December 31, 2020 |
Assets |
|
|
|
Current
Assets |
|
|
|
Cash and cash equivalents |
$ |
24,054 |
|
|
$ |
16,898 |
|
Accounts receivable (net of allowances of $817 and $955,
respectively) |
76,088 |
|
|
56,423 |
|
Inventories |
195,976 |
|
|
111,699 |
|
Prepaid expenses and other current assets |
16,632 |
|
|
5,045 |
|
Total current assets |
312,750 |
|
|
190,065 |
|
|
|
|
|
Property, Plant and
Equipment, net |
52,544 |
|
|
47,285 |
|
|
|
|
|
Other
Assets |
|
|
|
Operating lease right-of-use assets |
19,890 |
|
|
12,193 |
|
Goodwill |
241,717 |
|
|
153,537 |
|
Other intangible assets, net |
277,912 |
|
|
184,527 |
|
Deferred tax assets, net |
2,481 |
|
|
2,671 |
|
Other assets |
7,072 |
|
|
6,260 |
|
Total Assets |
$ |
914,366 |
|
|
$ |
596,538 |
|
|
|
|
|
Liabilities and
Stockholders’ Equity |
|
|
|
Current
Liabilities |
|
|
|
Accounts payable |
$ |
34,176 |
|
|
$ |
25,200 |
|
Accrued expenses and other current liabilities |
37,852 |
|
|
29,029 |
|
Contingent consideration payable |
53,149 |
|
|
— |
|
Current portion of operating lease liabilities |
5,334 |
|
|
3,623 |
|
Current portion of long-term debt |
3,750 |
|
|
7,000 |
|
Total current liabilities |
134,261 |
|
|
64,852 |
|
Non-Current
Liabilities |
|
|
|
Long-term debt |
384,659 |
|
|
172,662 |
|
Warrant liabilities |
8,240 |
|
|
— |
|
Deferred tax liabilities, net |
51,255 |
|
|
23,297 |
|
Operating lease liabilities, less current portion |
18,437 |
|
|
11,324 |
|
Other liabilities |
15,366 |
|
|
15,557 |
|
Total Liabilities |
612,218 |
|
|
287,692 |
|
Commitments and
Contingencies |
— |
|
|
— |
|
Stockholders’
Equity |
|
|
|
Preferred shares, $0.0001 par value; 1,000,000 shares authorized;
none issued and outstanding at June 30, 2021 and
December 31, 2020 |
— |
|
|
— |
|
Common stock, $0.0001 par value; 220,000,000 shares authorized;
38,455,759 and 38,426,669 shares issued and outstanding
at June 30, 2021 and December 31, 2020,
respectively. |
4 |
|
|
4 |
|
Additional paid-in capital |
325,150 |
|
|
325,679 |
|
Accumulated deficit |
(34,849 |
) |
|
(25,442 |
) |
Accumulated other comprehensive income |
11,843 |
|
|
8,605 |
|
Total stockholders’ equity |
302,148 |
|
|
308,846 |
|
Total Liabilities and Stockholders’ Equity |
$ |
914,366 |
|
|
$ |
596,538 |
|
Whole Earth Brands, Inc. |
Condensed Consolidated and Combined Statements of
Operations |
(In thousands of dollars, except for share and per share
data) |
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
(Successor) |
|
|
(Predecessor) |
|
Three MonthsEnded June 30,2021 |
|
Six MonthsEnded June 30,2021 |
|
From June 26,2020 to June 30,2020 |
|
|
From April 1 2020 to June 25,2020 |
|
From January 1,2020 to June 25,2020 |
Product revenues, net |
$ |
126,493 |
|
|
$ |
232,318 |
|
|
$ |
4,478 |
|
|
|
$ |
62,356 |
|
|
$ |
128,328 |
|
Cost of goods sold |
85,138 |
|
|
155,312 |
|
|
2,708 |
|
|
|
37,515 |
|
|
77,627 |
|
Gross profit |
41,355 |
|
|
77,006 |
|
|
1,770 |
|
|
|
24,841 |
|
|
50,701 |
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and
administrative expenses |
27,828 |
|
|
60,735 |
|
|
1,946 |
|
|
|
27,307 |
|
|
43,355 |
|
Amortization of intangible
assets |
4,706 |
|
|
8,857 |
|
|
141 |
|
|
|
2,393 |
|
|
4,927 |
|
Asset impairment charges |
— |
|
|
— |
|
|
— |
|
|
|
— |
|
|
40,600 |
|
Restructuring and other
expenses |
2,846 |
|
|
4,503 |
|
|
— |
|
|
|
— |
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss) |
5,975 |
|
|
2,911 |
|
|
(317 |
) |
|
|
(4,859 |
) |
|
(38,181 |
) |
|
|
|
|
|
|
|
|
|
|
|
Change in fair value of
warrant liabilities |
(241 |
) |
|
(2,603 |
) |
|
— |
|
|
|
— |
|
|
— |
|
Interest expense, net |
(6,396 |
) |
|
(11,474 |
) |
|
(116 |
) |
|
|
(66 |
) |
|
(238 |
) |
Loss on extinguishment and
debt transaction costs |
— |
|
|
(5,513 |
) |
|
— |
|
|
|
— |
|
|
— |
|
Other income (expense),
net |
190 |
|
|
500 |
|
|
(62 |
) |
|
|
(920 |
) |
|
801 |
|
Loss before income taxes |
(472 |
) |
|
(16,179 |
) |
|
(495 |
) |
|
|
(5,845 |
) |
|
(37,618 |
) |
(Benefit) provision for income
taxes |
(4,167 |
) |
|
(7,849 |
) |
|
10 |
|
|
|
(364 |
) |
|
(3,482 |
) |
Net income (loss) |
$ |
3,695 |
|
|
$ |
(8,330 |
) |
|
$ |
(505 |
) |
|
|
$ |
(5,481 |
) |
|
$ |
(34,136 |
) |
|
|
|
|
|
|
|
|
|
|
|
Net earnings (loss) per
share: |
|
|
|
|
|
|
|
|
|
|
Basic |
$ |
0.10 |
|
|
$ |
(0.22 |
) |
|
$ |
(0.01 |
) |
|
|
|
|
|
Diluted |
$ |
0.09 |
|
|
$ |
(0.22 |
) |
|
$ |
(0.01 |
) |
|
|
|
|
|
Whole Earth Brands, Inc. |
Condensed Consolidated and Combined Statements of Cash
Flows |
(In thousands of dollars) |
(Unaudited) |
|
|
|
|
|
|
|
|
(Successor) |
|
|
(Predecessor) |
|
Six Months EndedJune 30, 2021 |
|
From June 26, 2020 toJune 30, 2020 |
|
|
From January 1, 2020 toJune 25,
2020 |
Operating
activities |
|
|
|
|
|
|
Net loss |
$ |
(8,330 |
) |
|
$ |
(505 |
) |
|
|
$ |
(34,136 |
) |
Adjustments to reconcile net loss to net cash provided by operating
activities: |
|
|
|
|
|
|
Stock-based compensation |
4,464 |
|
|
— |
|
|
|
— |
|
Depreciation |
2,120 |
|
|
43 |
|
|
|
1,334 |
|
Amortization of intangible assets |
8,857 |
|
|
141 |
|
|
|
4,927 |
|
Deferred income taxes |
808 |
|
|
9 |
|
|
|
(5,578 |
) |
Asset impairment charges |
— |
|
|
— |
|
|
|
40,600 |
|
Amortization of inventory fair value adjustments |
1,727 |
|
|
— |
|
|
|
— |
|
Non-cash loss on extinguishment of debt |
4,435 |
|
|
— |
|
|
|
— |
|
Change in fair value of warrant liabilities |
2,603 |
|
|
— |
|
|
|
— |
|
Changes in current assets and liabilities: |
|
|
|
|
|
|
Accounts receivable |
(4,891 |
) |
|
(1,834 |
) |
|
|
7,726 |
|
Inventories |
(8,142 |
) |
|
311 |
|
|
|
3,576 |
|
Prepaid expenses and other current assets |
762 |
|
|
(29 |
) |
|
|
3,330 |
|
Accounts payable, accrued liabilities and income taxes |
(14,895 |
) |
|
(2,161 |
) |
|
|
507 |
|
Other, net |
1,028 |
|
|
28 |
|
|
|
(2,378 |
) |
Net cash (used in) provided by
operating activities |
(9,454 |
) |
|
(3,997 |
) |
|
|
19,908 |
|
|
|
|
|
|
|
|
Investing
activities |
|
|
|
|
|
|
Capital expenditures |
(4,624 |
) |
|
(10 |
) |
|
|
(3,532 |
) |
Acquisitions, net of cash
acquired |
(186,601 |
) |
|
(376,674 |
) |
|
|
— |
|
Proceeds from the sale of
fixed assets |
4,257 |
|
|
— |
|
|
|
— |
|
Transfer from trust
account |
— |
|
|
178,875 |
|
|
|
— |
|
Net cash used in investing
activities |
(186,968 |
) |
|
(197,809 |
) |
|
|
(3,532 |
) |
|
|
|
|
|
|
|
Financing
activities |
|
|
|
|
|
|
Proceeds from revolving credit
facility |
25,000 |
|
|
— |
|
|
|
3,500 |
|
Repayments of revolving credit
facility |
(47,855 |
) |
|
— |
|
|
|
(8,500 |
) |
Long-term borrowings |
375,000 |
|
|
140,000 |
|
|
|
— |
|
Repayments of long-term
borrowings |
(137,438 |
) |
|
— |
|
|
|
— |
|
Debt issuance costs |
(11,589 |
) |
|
(7,139 |
) |
|
|
— |
|
Proceeds from sale of common
stock and warrants |
— |
|
|
75,000 |
|
|
|
— |
|
Funding to Parent, net |
— |
|
|
— |
|
|
|
(11,924 |
) |
Net cash provided by (used in)
financing activities |
203,118 |
|
|
207,861 |
|
|
|
(16,924 |
) |
Whole Earth Brands, Inc. |
Condensed Consolidated and Combined Statements of Cash
Flows (Continued) |
(In thousands of dollars) |
(Unaudited) |
|
|
|
|
|
|
|
|
(Successor) |
|
|
(Predecessor) |
|
Six Months EndedJune 30, 2021 |
|
From June 26, 2020 toJune 30, 2020 |
|
|
From January 1, 2020 toJune 25,
2020 |
|
|
|
|
|
|
|
Effect of exchange rate
changes on cash and cash equivalents |
460 |
|
|
17 |
|
|
|
215 |
|
Net change in cash and
cash equivalents |
7,156 |
|
|
6,072 |
|
|
|
(333 |
) |
Cash and cash equivalents,
beginning of period |
16,898 |
|
|
55,535 |
|
|
|
10,395 |
|
Cash and cash equivalents, end of period |
$ |
24,054 |
|
|
$ |
61,607 |
|
|
|
$ |
10,062 |
|
|
|
|
|
|
|
|
Supplemental
disclosure of cash flow information |
|
|
|
|
|
|
Interest paid |
$ |
10,037 |
|
|
$ |
113 |
|
|
|
$ |
798 |
|
Taxes paid, net of refunds |
$ |
4,364 |
|
|
$ |
— |
|
|
|
$ |
2,244 |
|
Supplemental
disclosure of non-cash investing |
|
|
|
|
|
|
Non-cash capital expenditure |
$ |
3,554 |
|
|
$ |
— |
|
|
|
$ |
— |
|
Whole Earth Brands, Inc.
Reconciliation of GAAP and Non-GAAP Financial
Measures (Unaudited)
The Company reports its financial results in
accordance with accounting principles generally accepted in the
United States (“GAAP”). However, management believes that also
presenting certain non-GAAP financial measures provides additional
information to facilitate the comparison of the Company’s
historical operating results and trends in its underlying operating
results, and provides additional transparency on how the Company
evaluates its business. Management uses these non-GAAP financial
measures in making financial, operating and planning decisions and
in evaluating the Company’s performance. The Company also believes
that presenting these measures allows investors to view its
performance using the same measures that the Company uses in
evaluating its financial and business performance and trends. The
Company considers quantitative and qualitative factors in assessing
whether to adjust for the impact of items that may be significant
or that could affect an understanding of its ongoing financial and
business performance and trends. The adjustments generally fall
within the following categories: constant currency adjustments,
intangible asset non-cash impairments, purchase accounting charges,
transaction related costs, long-term incentive expense, non-cash
pension expenses, severance and related expenses associated with a
restructuring, public company readiness, M&A transaction
expenses and other one-time items affecting comparability of
operating results. See below for a description of adjustments to
the Company’s U.S. GAAP financial measures included herein.
Non-GAAP information should be considered as supplemental in nature
and is not meant to be considered in isolation or as a substitute
for the related financial information prepared in accordance with
U.S. GAAP. In addition, the Company’s non-GAAP financial measures
may not be the same as or comparable to similar non-GAAP measures
presented by other companies.
DEFINITIONS OF THE COMPANY’S NON-GAAP
FINANCIAL MEASURES
The Company’s non-GAAP financial measures and
corresponding metrics reflect how the Company evaluates its
operating results currently and provide improved comparability of
operating results. As new events or circumstances arise, these
definitions could change. When these definitions change, the
Company provides the updated definitions and presents the related
non-GAAP historical results on a comparable basis. When items no
longer impact the Company’s current or future presentation of
non-GAAP operating results, the Company removes these items from
its non-GAAP definitions. The following is a list of non-GAAP
financial measures which the Company has discussed or expects to
discuss in the future:
- Constant Currency Presentation: We
evaluate our product revenue results on both a reported and a
constant currency basis. The constant currency presentation, which
is a non-GAAP measure, excludes the impact of fluctuations in
foreign currency exchange rates. We believe providing constant
currency information provides valuable supplemental information
regarding our product revenue results, thereby facilitating
period-to-period comparisons of our business performance and is
consistent with how management evaluates the Company’s performance.
We calculate constant currency percentages by converting our
current period local currency product revenue results using the
prior period exchange rates and comparing these adjusted amounts to
our current period reported product revenues.
- Adjusted EBITDA: We define Adjusted
EBITDA as net income or loss from our consolidated statements of
operations before interest income and expense, income taxes,
depreciation and amortization, as well as certain other items that
arise outside of the ordinary course of our continuing operations
specifically described below:
- Asset impairment charges: We
exclude the impact of charges related to the impairment of goodwill
and other long-lived intangible assets. Impairment charges during
the calendar year 2020 were incurred only during the predecessor
period. We believe that the exclusion of these impairments, which
are non-cash, allows for more meaningful comparisons of operating
results to peer companies. We believe that this increases
period-to-period comparability and is useful to evaluate the
performance of the total company.
- Purchase accounting adjustments: We
exclude the impact of purchase accounting adjustments, including
the revaluation of inventory at the time of the business
combination. These adjustments are non-cash and we believe that the
adjustments of these items more closely correlate with the
sustainability of our operating performance.
- Transaction-related expenses: We
exclude transaction-related expenses including transaction bonuses
that were paid for by the seller of the businesses acquired by the
Company on June 25, 2020. We believe that the adjustments of these
items more closely correlate with the sustainability of our
operating performance.
- Long-term incentive plan: We
exclude the impact of costs relating to the long-term incentive
plan. We believe that the adjustments of these items more closely
correlate with the sustainability of our operating
performance.
- Non-cash pension expenses: We
exclude non-cash pension expenses/credits related to closed,
defined pension programs of the Company. We believe that the
adjustments of these items more closely correlate with the
sustainability of our operating performance.
- Severance and related expenses: We
exclude employee severance and associated expenses related to roles
that have been eliminated or reduced in scope as a productivity
measure taken by the Company. We believe that the adjustments of
these items more closely correlate with the sustainability of our
operating performance.
- Public company readiness: We
exclude non-recurring organization and consulting costs incurred to
establish required public company capabilities. We believe that the
adjustments of these items more closely correlate with the
sustainability of our operating performance.
- Brand Introduction expenses: To
measure operating performance, we exclude the Company’s sampling
program costs with Starbucks. We believe the exclusion of such
amounts allows management and the users of the financial statements
to better understand our financial results.
- Restructuring: To measure operating
performance, we exclude restructuring costs. We believe that the
adjustments of these items more closely correlate with the
sustainability of our operating performance.
- M&A transaction expenses: We
exclude expenses directly related to the acquisition of businesses
after the business combination on June 25, 2020. We believe that
the adjustments of these items more closely correlate with the
sustainability of our operating performance.
- Other items: To measure operating
performance, we exclude certain expenses and include certain gains
that we believe are operational in nature. We believe the exclusion
or inclusion of such amounts allows management and the users of the
financial statements to better understand our financial
results.
Adjusted EBITDA is not a presentation made in
accordance with GAAP, and our use of the term Adjusted EBITDA may
vary from the use of similarly-titled measures by others in our
industry due to the potential inconsistencies in the method of
calculation and differences due to items subject to interpretation.
Adjusted EBITDA margin is Adjusted EBITDA for a particular period
expressed as a percentage of product revenues for that period.
We use Adjusted EBITDA to measure our
performance from period to period both at the consolidated level as
well as within our operating segments, to evaluate and fund
incentive compensation programs and to compare our results to those
of our competitors. In addition to Adjusted EBITDA being a
significant measure of performance for management purposes, we also
believe that this presentation provides useful information to
investors regarding financial and business trends related to our
results of operations and that when non-GAAP financial information
is viewed with GAAP financial information, investors are provided
with a more meaningful understanding of our ongoing operating
performance.
Adjusted EBITDA should not be considered as an
alternative to net income or loss, operating income, cash flows
from operating activities or any other performance measures derived
in accordance with GAAP as measures of operating performance or
cash flows as measures of liquidity. Adjusted EBITDA has important
limitations as an analytical tool and should not be considered in
isolation or as a substitute for analysis of our results as
reported under GAAP.
The Company cannot reconcile its expected
Adjusted EBITDA to Net Income under “Outlook” without unreasonable
effort because certain items that impact net income and other
reconciling metrics are out of the Company’s control and/or cannot
be reasonably predicted at this time. These items include, but are
not limited to, share-based compensation expense, impairment of
assets, acquisition-related charges and COVID-19 related expenses.
These items are uncertain, depend on various factors, and could
have a material impact on GAAP reported results for the guidance
period.
Adjusted Gross Profit Margin: We define Adjusted
Gross Profit Margin as Gross Profit excluding all cash and non-cash
adjustments, impacting Cost of Goods Sold, included in the Adjusted
EBITDA reconciliation, as a percentage of Product Revenues, net.
Such adjustments include: depreciation, purchase accounting
adjustments, long term incentives and other items adjusted by
management to better understand our financial results.
The Company cannot reconcile its expected
Adjusted Gross Profit Margin to Gross Profit Margin under “Outlook”
without unreasonable effort because certain items that impact Gross
Profit Margin and other reconciling metrics are out of the
Company’s control and/or cannot be reasonably predicted at this
time. These items include, but are not limited to, share-based
compensation expense, impairment of assets, acquisition-related
charges and COVID-19 related expenses. These items are uncertain,
depend on various factors, and could have a material impact on GAAP
reported results for the guidance period.
Whole Earth Brands,
Inc.Adjusted EBITDA
reconciliation(In thousands of dollars)
(Unaudited)
|
(Successor) |
|
|
(Predecessor) |
|
|
Three MonthsEnded June 30,2021 |
|
Six MonthsEnded June 30,2021 |
|
From June 26, 2020to June 30, 2020 |
|
|
From April 1, 2020to June 25, 2020 |
|
From January 1, 2020 to June 25, 2020 |
|
Product revenues, net |
$ |
126,493 |
|
|
$ |
232,318 |
|
|
$ |
4,478 |
|
|
|
$ |
62,356 |
|
|
$ |
128,328 |
|
|
Net income (loss) |
$ |
3,695 |
|
|
$ |
(8,330 |
) |
|
$ |
(505 |
) |
|
|
$ |
(5,481 |
) |
|
$ |
(34,136 |
) |
|
(Benefit) provision for income taxes |
|
(4,167 |
) |
|
|
(7,849 |
) |
|
|
10 |
|
|
|
|
(364 |
) |
|
|
(3,482 |
) |
|
Other (income) expense, net |
|
(190 |
) |
|
|
(500 |
) |
|
|
62 |
|
|
|
|
920 |
|
|
|
(801 |
) |
|
Loss on extinguishment and debt transaction costs |
|
- |
|
|
|
5,513 |
|
|
|
- |
|
|
|
|
- |
|
|
|
- |
|
|
Interest expense, net |
|
6,396 |
|
|
|
11,474 |
|
|
|
116 |
|
|
|
|
66 |
|
|
|
238 |
|
|
Change in fair value of warrant liabilities |
|
241 |
|
|
|
2,603 |
|
|
|
- |
|
|
|
|
- |
|
|
|
- |
|
|
Operating income (loss) |
|
5,975 |
|
|
|
2,911 |
|
|
|
(317 |
) |
|
|
|
(4,859 |
) |
|
|
(38,181 |
) |
|
Depreciation |
|
1,150 |
|
|
|
2,120 |
|
|
|
39 |
|
|
|
|
502 |
|
|
|
1,208 |
|
|
Amortization of intangible assets |
|
4,706 |
|
|
|
8,857 |
|
|
|
141 |
|
|
|
|
2,393 |
|
|
|
4,927 |
|
|
Asset impairment charges |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
- |
|
|
|
40,600 |
|
|
Purchase accounting adjustments |
|
107 |
|
|
|
1,726 |
|
|
|
- |
|
|
|
|
- |
|
|
|
- |
|
|
Transaction related expenses |
|
204 |
|
|
|
415 |
|
|
|
669 |
|
|
|
|
10,348 |
|
|
|
10,348 |
|
|
Long term incentive plan |
|
2,925 |
|
|
|
5,017 |
|
|
|
(21 |
) |
|
|
|
160 |
|
|
|
562 |
|
|
Non-cash pension expense |
|
- |
|
|
|
- |
|
|
|
32 |
|
|
|
|
183 |
|
|
|
335 |
|
|
Severance and related expenses |
|
- |
|
|
|
- |
|
|
|
56 |
|
|
|
|
918 |
|
|
|
1,105 |
|
|
Public company readiness |
|
1,349 |
|
|
|
1,803 |
|
|
|
30 |
|
|
|
|
287 |
|
|
|
569 |
|
|
Brand introduction costs |
|
- |
|
|
|
- |
|
|
|
22 |
|
|
|
|
378 |
|
|
|
1,131 |
|
|
Restructuring |
|
2,846 |
|
|
|
4,503 |
|
|
|
- |
|
|
|
|
- |
|
|
|
- |
|
|
M&A transaction expenses |
|
1,469 |
|
|
|
9,941 |
|
|
|
- |
|
|
|
|
- |
|
|
|
- |
|
|
Other items |
|
1,264 |
|
|
|
2,154 |
|
|
|
27 |
|
|
|
|
299 |
|
|
|
634 |
|
|
Adjusted EBITDA |
$ |
21,995 |
|
|
$ |
39,447 |
|
|
$ |
678 |
|
|
|
$ |
10,609 |
|
|
$ |
23,240 |
|
|
Whole Earth Brands,
Inc.Constant Currency Product Revenues, Net
Reconciliation(In thousands of
dollars)
$ in Thousands |
Three Months Ended June 30, |
|
|
|
|
$ change |
% change |
|
Product revenues, net |
|
2021 |
|
|
2020 |
Reported |
ConstantDollar |
ForeignExchange (2) |
Reported |
ConstantDollar |
ForeignExchange |
|
Branded CPG |
$ |
99,095 |
|
$ |
43,081 |
|
$ |
56,014 |
|
|
$ |
53,014 |
|
|
$ |
3,000 |
130.0 |
% |
123.1 |
% |
7.0 |
% |
|
Flavors & Ingredients |
$ |
27,398 |
|
$ |
23,753 |
|
$ |
3,645 |
|
|
$ |
3,645 |
|
|
$ |
- |
15.3 |
% |
15.3 |
% |
0.0 |
% |
|
Combined |
$ |
126,493 |
|
$ |
66,834 |
|
$ |
59,659 |
|
|
$ |
56,659 |
|
|
$ |
3,000 |
89.3 |
% |
84.8 |
% |
4.5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proforma Organic(1) |
|
|
|
|
|
|
|
|
|
Branded CPG |
$ |
99,095 |
|
$ |
104,544 |
|
$ |
(5,449 |
) |
|
$ |
(8,500 |
) |
|
$ |
3,051 |
-5.2 |
% |
-8.1 |
% |
2.9 |
% |
|
Flavors & Ingredients |
$ |
27,398 |
|
$ |
23,753 |
|
$ |
3,645 |
|
|
$ |
3,645 |
|
|
$ |
- |
15.3 |
% |
15.3 |
% |
0.0 |
% |
|
Combined |
$ |
126,493 |
|
$ |
128,297 |
|
$ |
(1,804 |
) |
|
$ |
(4,855 |
) |
|
$ |
3,051 |
-1.4 |
% |
-3.8 |
% |
2.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ in Thousands |
Six Months Ended June 30, |
|
|
|
|
$ change |
% change |
|
Product revenues, net |
|
2021 |
|
|
2020 |
Reported |
ConstantDollar |
ForeignExchange (2) |
Reported |
ConstantDollar |
ForeignExchange |
|
Branded CPG |
$ |
180,892 |
|
$ |
83,300 |
|
$ |
97,592 |
|
|
$ |
92,450 |
|
|
$ |
5,142 |
117.2 |
% |
111.0 |
% |
6.2 |
% |
|
Flavors & Ingredients |
$ |
51,426 |
|
$ |
49,506 |
|
$ |
1,920 |
|
|
$ |
1,920 |
|
|
$ |
- |
3.9 |
% |
3.9 |
% |
0.0 |
% |
|
Combined |
$ |
232,318 |
|
$ |
132,806 |
|
$ |
99,512 |
|
|
$ |
94,370 |
|
|
$ |
5,142 |
74.9 |
% |
71.1 |
% |
3.9 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proforma Organic(1) |
|
|
|
|
|
|
|
|
|
Branded CPG |
$ |
201,266 |
|
$ |
195,727 |
|
$ |
5,539 |
|
|
$ |
317 |
|
|
$ |
5,222 |
2.8 |
% |
0.2 |
% |
2.7 |
% |
|
Flavors & Ingredients |
$ |
51,426 |
|
$ |
49,506 |
|
$ |
1,920 |
|
|
$ |
1,920 |
|
|
$ |
- |
3.9 |
% |
3.9 |
% |
0.0 |
% |
|
Combined |
$ |
252,692 |
|
$ |
245,233 |
|
$ |
7,459 |
|
|
$ |
2,237 |
|
|
$ |
5,222 |
3.0 |
% |
0.9 |
% |
2.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Product revenues, net shown on a like for like basis, including
the impact of both acquisitions for all periods in both the current
and prior year periods |
|
(2) The "foreign exchange" amounts presented, reflect the estimated
impact from fluctuations in foreign currency exchange rates on
product revenues. |
|
Whole Earth Brands,
Inc.GAAP to Adjusted EBITDA
Reconciliation(In thousands of
dollars)
$ in Thousands |
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30, 2020 |
|
Three Months Ended June 30, 2021 |
|
|
|
|
GAAP |
Non-cashadj. |
Cash adj. |
AdjustedEBITDA |
|
GAAP |
Non-cashadj. |
Cash adj. |
AdjustedEBITDA |
|
$ Change |
% Change |
Product revenues, net |
$ |
66,834 |
|
$ |
- |
|
$ |
- |
|
|
66,834 |
|
|
$ |
126,493 |
|
$ |
- |
|
$ |
- |
|
|
126,493 |
|
|
$ |
59,659 |
89.3% |
|
Cost of goods sold |
|
40,223 |
|
|
(541) |
|
|
(400) |
|
|
39,282 |
|
|
|
85,138 |
|
|
(938) |
|
|
(726) |
|
|
83,474 |
|
|
|
44,192 |
112.5% |
|
Gross profit |
|
26,611 |
|
|
541 |
|
|
400 |
|
|
27,552 |
|
|
|
41,355 |
|
|
938 |
|
|
726 |
|
|
43,019 |
|
|
|
15,467 |
56.1% |
|
Gross profit margin % |
|
39.8% |
|
|
|
|
41.2% |
|
|
|
32.7% |
|
|
|
|
34.0% |
|
|
|
(7.2%) |
|
Selling, general and administrative expenses |
|
29,253 |
|
|
(215) |
|
|
(12,773) |
|
|
16,265 |
|
|
|
27,828 |
|
|
(4,572) |
|
|
(2,232) |
|
|
21,024 |
|
|
|
4,759 |
29.3% |
|
Amortization of intangible assets |
|
2,534 |
|
|
(2,534) |
|
|
- |
|
|
- |
|
|
|
4,706 |
|
|
(4,706) |
|
|
- |
|
|
- |
|
|
|
- |
- |
|
Asset impairment charges |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
|
- |
- |
|
Restructuring and other non-recurring expenses |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
|
2,846 |
|
|
- |
|
|
(2,846) |
|
|
- |
|
|
|
- |
- |
|
Operating income |
$ |
(5,176) |
|
$ |
3,290 |
|
$ |
13,173 |
|
$ |
11,287 |
|
|
$ |
5,975 |
|
$ |
10,216 |
|
$ |
5,804 |
|
$ |
21,995 |
|
|
$ |
10,708 |
94.9% |
|
Operating margin % |
|
(7.7%) |
|
|
|
|
16.9% |
|
|
|
4.7% |
|
|
|
|
17.4% |
|
|
|
0.5% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ in Thousands |
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30, 2020 |
|
Six Months Ended June 30, 2021 |
|
|
|
|
GAAP |
Non-cashadj. |
Cash adj. |
AdjustedEBITDA |
|
GAAP |
Non-cashadj. |
Cash adj. |
AdjustedEBITDA |
|
$ Change |
% Change |
Product revenues, net |
$ |
132,806 |
|
$ |
- |
|
$ |
- |
|
|
132,806 |
|
|
$ |
232,318 |
|
$ |
- |
|
$ |
- |
|
|
232,318 |
|
|
$ |
99,512 |
74.9% |
|
Cost of goods sold |
|
80,335 |
|
|
(1,247) |
|
|
(1,427) |
|
|
77,661 |
|
|
|
155,312 |
|
|
(3,773) |
|
|
(1,282) |
|
|
150,257 |
|
|
|
72,596 |
93.5% |
|
Gross profit |
|
52,471 |
|
|
1,247 |
|
|
1,427 |
|
|
55,145 |
|
|
|
77,006 |
|
|
3,773 |
|
|
1,282 |
|
|
82,061 |
|
|
|
26,916 |
48.8% |
|
Gross profit margin % |
|
39.5% |
|
|
|
|
41.5% |
|
|
|
33.1% |
|
|
|
|
35.3% |
|
|
|
(6.2%) |
|
Selling, general and administrative expenses |
|
45,301 |
|
|
(367) |
|
|
(13,706) |
|
|
31,228 |
|
|
|
60,735 |
|
|
(6,515) |
|
|
(11,606) |
|
|
42,614 |
|
|
|
11,386 |
36.5% |
|
Amortization of intangible assets |
|
5,068 |
|
|
(5,068) |
|
|
- |
|
|
- |
|
|
|
8,857 |
|
|
(8,857) |
|
|
- |
|
|
- |
|
|
|
- |
- |
|
Asset impairment charges |
|
40,600 |
|
|
(40,600) |
|
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
|
- |
- |
|
Restructuring and other non-recurring expenses |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
|
4,503 |
|
|
(358) |
|
|
(4,145) |
|
|
- |
|
|
|
- |
- |
|
Operating income |
$ |
(38,498) |
|
$ |
47,282 |
|
$ |
15,134 |
|
$ |
23,918 |
|
|
$ |
2,911 |
|
$ |
19,503 |
|
$ |
17,033 |
|
$ |
39,447 |
|
|
$ |
15,530 |
64.9% |
|
Operating margin % |
|
(29.0%) |
|
|
|
|
18.0% |
|
|
|
1.3% |
|
|
|
|
17.0% |
|
|
|
(1.0%) |
|
Note – January 1 through June 25, 2020 is a
predecessor period. June 26 through June 30, 2020 is a successor
period.
Whole Earth Brands,
Inc.Adjustment to Operating Income by Income
Statement line and nature(In thousands of
dollars)
$ in Thousands |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30, 2020 |
|
Three Months Ended June 30, 2021 |
|
Non-Cash adjustments |
Cost ofGoodsSold |
SG&A |
Amort. OfIntangibles |
Assetimpair-ment |
Restruct-uring |
OperatingIncome |
|
Cost ofGoodsSold |
SG&A |
Amort. OfIntangibles |
Assetimpair-ment |
Restruct-uring |
OperatingIncome |
|
Depreciation |
541 |
- |
- |
- |
- |
541 |
|
1,090 |
|
60 |
|
- |
- |
- |
1,150 |
|
|
Amortization of intangible assets |
- |
- |
2,534 |
- |
- |
2,534 |
|
- |
|
- |
|
4,706 |
- |
- |
4,706 |
|
|
Asset impairment charges |
- |
- |
- |
- |
- |
- |
|
- |
|
- |
|
- |
- |
- |
- |
|
|
Restructuring |
- |
- |
- |
- |
- |
- |
|
- |
|
- |
|
- |
- |
- |
- |
|
|
Non-cash pension expense |
- |
215 |
- |
- |
- |
215 |
|
- |
|
- |
|
- |
- |
- |
- |
|
|
Long term incentive plan |
- |
- |
- |
- |
- |
- |
|
(347 |
) |
3,272 |
|
- |
- |
- |
2,925 |
|
|
Purchase accounting costs |
- |
- |
- |
- |
- |
- |
|
107 |
|
- |
|
- |
- |
- |
107 |
|
|
Other items |
- |
- |
- |
- |
- |
- |
|
88 |
|
1,240 |
|
- |
- |
- |
1,328 |
|
|
Total non-cash adjustments |
541 |
215 |
2,534 |
- |
- |
3,290 |
|
938 |
|
4,572 |
|
4,706 |
- |
- |
10,216 |
|
|
Cash adjustments |
|
|
|
|
|
|
|
|
|
|
|
|
- |
|
|
Restructuring |
- |
- |
- |
- |
- |
- |
|
- |
|
- |
|
- |
- |
2,846 |
2,846 |
|
|
Long term incentive plan |
- |
139 |
- |
- |
- |
139 |
|
- |
|
- |
|
- |
- |
- |
- |
|
|
Transaction related expenses |
- |
11,017 |
- |
- |
- |
11,017 |
|
- |
|
204 |
|
- |
- |
- |
204 |
|
|
Severance and related expenses |
- |
974 |
- |
- |
- |
974 |
|
- |
|
- |
|
- |
- |
- |
- |
|
|
Public company readiness |
- |
317 |
- |
- |
- |
317 |
|
- |
|
1,349 |
|
- |
- |
- |
1,349 |
|
|
Brand introduction costs |
400 |
- |
- |
- |
- |
400 |
|
- |
|
- |
|
- |
- |
- |
- |
|
|
M&A transaction expenses |
- |
- |
- |
- |
- |
- |
|
- |
|
1,469 |
|
- |
- |
- |
1,469 |
|
|
Other items |
- |
326 |
- |
- |
- |
326 |
|
726 |
|
(790 |
) |
- |
- |
- |
(64 |
) |
|
Total cash adjustments |
400 |
12,773 |
- |
- |
- |
13,173 |
|
726 |
|
2,232 |
|
- |
- |
2,846 |
5,804 |
|
|
Total adjustments |
941 |
12,988 |
2,534 |
- |
- |
16,463 |
|
1,664 |
|
6,804 |
|
4,706 |
- |
2,846 |
16,020 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ in Thousands |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30, 2020 |
|
Six Months Ended June 30, 2021 |
|
Non-Cash adjustments |
Cost ofGoodsSold |
SG&A |
Amort. OfIntangibles |
Assetimpair-ment |
Restruct-uring |
OperatingIncome |
|
Cost ofGoodsSold |
SG&A |
Amort. OfIntangibles |
Assetimpair-ment |
Restruct-uring |
OperatingIncome |
|
Depreciation |
1,247 |
- |
- |
- |
- |
1,247 |
|
2,060 |
|
60 |
|
- |
- |
- |
2,120 |
|
|
Amortization of intangible assets |
- |
- |
5,068 |
- |
- |
5,068 |
|
- |
|
- |
|
8,857 |
- |
- |
8,857 |
|
|
Asset impairment charges |
- |
- |
- |
40,600 |
- |
40,600 |
|
- |
|
- |
|
- |
- |
- |
- |
|
|
Restructuring |
- |
- |
- |
- |
- |
- |
|
- |
|
- |
|
- |
- |
358 |
358 |
|
|
Non-cash pension expense |
- |
367 |
- |
- |
- |
367 |
|
- |
|
- |
|
- |
- |
- |
- |
|
|
Long term incentive plan |
- |
- |
- |
- |
- |
- |
|
(101 |
) |
5,215 |
|
- |
- |
- |
5,114 |
|
|
Purchase accounting costs |
- |
- |
- |
- |
- |
- |
|
1,726 |
|
- |
|
- |
- |
- |
1,726 |
|
|
Other items |
- |
- |
- |
- |
- |
|
|
88 |
|
1,240 |
|
- |
- |
- |
1,328 |
|
|
Total non-cash adjustments |
1,247 |
367 |
5,068 |
40,600 |
- |
47,282 |
|
3,773 |
|
6,515 |
|
8,857 |
- |
358 |
19,503 |
|
|
Cash adjustments |
- |
- |
- |
- |
- |
- |
|
- |
|
- |
|
- |
- |
- |
- |
|
|
Restructuring |
- |
- |
- |
- |
- |
- |
|
- |
|
- |
|
- |
- |
4,145 |
4,145 |
|
|
Long term incentive plan |
47 |
494 |
- |
- |
- |
541 |
|
(22 |
) |
(75 |
) |
- |
- |
- |
(97 |
) |
|
Transaction related expenses |
- |
11,017 |
- |
- |
- |
11,017 |
|
- |
|
415 |
|
- |
- |
- |
415 |
|
|
Severance and related expenses |
- |
1,161 |
- |
- |
- |
1,161 |
|
- |
|
- |
|
- |
- |
- |
- |
|
|
Public company readiness |
- |
599 |
- |
- |
- |
599 |
|
- |
|
1,803 |
|
- |
- |
- |
1,803 |
|
|
Brand introduction costs |
1,153 |
- |
- |
- |
- |
1,153 |
|
- |
|
- |
|
- |
- |
- |
- |
|
|
M&A transaction expenses |
- |
- |
- |
- |
- |
- |
|
- |
|
9,941 |
|
- |
- |
- |
9,941 |
|
|
Other items |
227 |
434 |
- |
- |
- |
661 |
|
1,303 |
|
(477 |
) |
- |
- |
- |
826 |
|
|
Total cash adjustments |
1,427 |
13,706 |
- |
- |
- |
15,134 |
|
1,282 |
|
11,606 |
|
- |
- |
4,145 |
17,033 |
|
|
Total adjustments |
2,674 |
14,073 |
5,068 |
40,600 |
- |
62,416 |
|
5,055 |
|
18,121 |
|
8,857 |
- |
4,503 |
36,536 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-cash adjustments: Within the Adjusted
EBITDA reconciliation include certain transactions that are
non-cash in nature. Such items include depreciation, amortization
of intangibles, asset impairment charges, non-cash pension expense,
long-term incentive plan expenses (stock based compensation) and
purchase accounting adjustments.
Cash adjustments: Within the Adjusted EBITDA
reconciliation include certain transactions that are one-off,
non-recurring in nature, but have been or will be settled with
Company cash.
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