UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation or organization) |
(Commission File Number) | (I.R.S. Employer Identification Number) |
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| (Address of principal executive offices) | (Zip Code) |
Company’s telephone number, including
area code: (
Securities registered pursuant to Section 12(b) of the Act:
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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation to the registrant under any of the following provisions:
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.
¨ If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
| Item 2.02 | Results of Operation and Financial Condition. |
On May 4, 2021, Exela Technologies, Inc. (the “Company”) issued a press release announcing its financial results for the quarter ended March 31, 2021. A copy of the press release is furnished herewith as Exhibit 99.1.
The information in this Current Report on Form 8-K furnished pursuant to Item 2.02, including Exhibit 99.1, shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to liability under that section, and they shall not be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing. The Company is making reference to non-GAAP financial information in the press release. A reconciliation of the non-GAAP financial measures to the comparable GAAP financial measures is contained in the attached press release.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits
| Exhibit Number | Exhibit Description | |
| 99.1* | Press Release dated May 4, 2021 | |
| 104 | The cover page from this Current Report on Form 8-K, formatted in Inline XBRL. |
* Furnished herewith
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Dated: May 6, 2021
| EXELA TECHNOLOGIES, INC. | |||
| By: | /s/ Shrikant Sortur | ||
| Name: | Shrikant Sortur | ||
| Title: | Chief Financial Officer | ||
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Exhibit 99.1
Exela Technologies, Inc. Reports First Quarter 2021 Results
May 04, 2021 08:30 ET | Source: Exela Technologies, Inc.
Revenue
of $300.1 million and Adjusted EBITDA of $46.5 million
Reiterates 2021 Financial Guidance
SMB business showing robust growth
Conference Call Scheduled for May 4, 2021 at 11:00 AM ET
First Quarter 2021 Highlights:
| · | Revenue of $300.1 million, a decline of 17.9% from Q1 2020 |
| · | Gross profit(1) margin of 22.5%, an increase of 250 basis points from Q1 2020 and 370 basis points from Q4 2020 |
| · | Operating income of $4.3 million, compared with operating loss of $2.2 million in Q1 2020 |
| · | Net loss of $39.2 million, compared with a loss of $12.7 million in Q1 2020 |
| · | EBITDA(2) of $23.5 million, compared with $54.6 million in Q1 2020 |
| · | Adjusted EBITDA(3) of $46.5 million, an increase of 4.7% from $44.4 million in Q1 2020 |
| · | Recently launched SMB business showing robust growth QoQ – DMR customers grew 117% and DrySign users grew 170% |
| · | First cloud hosted deployment of PCH Global platform with a major insurer for a $90 million, 10 year licensing agreement |
| · | Operating leverage improvement continues with 25% of the announced reduction in facilities completed as part of a multi-year plan |
| · | Automation led efficiencies reduced employee count to 18,400 as of March 31, 2021 from 19,000 as of December 31, 2020 |
| · | Expanding financial flexibility with $26.8 million in gross proceeds(4) raised in an equity offering |
IRVING, Texas, May 04, 2021 (GLOBE NEWSWIRE) -- Exela Technologies, Inc. (“Exela” or the “Company”) (NASDAQ: XELA), a location-agnostic global business process automation (“BPA”) leader, announced today its financial results for the first quarter ended March 31, 2021.
“We are pleased with the strong expansion of both our gross margin and adjusted EBITDA margin in the first quarter, which reflects our ongoing commitment to focus on our core businesses and drive continued operational improvement. We are also impressed with the adoption of the various Digital Assets Group solutions in the SMB and enterprise markets. Based on our first quarter results and the momentum we see in the business, we reiterate our prior 2021 guidance,” said Ronald Cogburn, Chief Executive Officer of Exela.
First Quarter 2021 Financial Highlights
| · | Revenue: Revenue for Q1 2021 was $300.1 million, a decline of 17.9% compared to $365.5 million from Q1 2020, primarily due to lower volumes as a result of COVID-19, pruning of transition revenue(5), and strategic asset sales. Revenue for the Information and Transaction Processing Solutions segment was $231.9 million, a decline of 18.4% year-over-year. Healthcare Solutions revenue was $51.1 million, a decrease of 20.2% year-over-year. Legal and Loss Prevention Services revenue was $17.1 million, consistent with the prior year period. |
1
| · | Operating income / (loss): Operating income for Q1 2021 was $4.3 million, compared with operating loss of $2.2 million in Q1 2020. The year-over-year improvement in operating income was primarily attributable to lower SG&A and depreciation and amortization expenses. |
| · | Net Loss: Net Loss for Q1 2021 was $39.2 million, compared with a net loss of $12.7 million in Q1 2020, primarily due to a gain of $35.3 million recognized on the sale of SourceHOV Tax, LLC during Q1 2020. Net loss excluding the gain on sale of SourceHOV Tax improved by 22.1% in the quarter compared to the prior year period. |
| · | Adjusted EBITDA: Adjusted EBITDA for Q1 2021 was $46.5 million, an increase of 4.7% compared to $44.4 million in Q1 2020. Adjusted EBITDA margin for Q1 2021 was 15.5%, up 334 basis points from 12.1% in Q1 2020. Adjusted EBITDA margin, based on revenue excluding pass through revenue(6), was 19.3% in Q1 2021, an increase of approximately 429 basis points from 15.0% compared to Q1 2020 and an increase of 501 basis points from 14.3% sequentially from Q4 2020. |
| · | Common Stock: After accounting for the 1:3 reverse split, as of March 31, 2021, there were 59,192,012 total shares of common stock outstanding and an additional 1,215,924 shares of common stock reserved for issuance for our outstanding preferred shares on an as-converted basis. |
First
Quarter 2021 Business Highlights
Contract and product updates:
| · | First cloud hosted deployment of Exela’s PCH Global platform with a major insurer for a $90 million, 10 year licensing agreement |
| · | Global expansion of the Exchange for Bills and Payments (XBP) into the Americas, Continental Europe and Asia |
| · | Accelerating demand for WFA and BPM solutions as go to market expands beyond enterprise customers: Recently launched SMB business showing robust growth QoQ – DMR customers grew 117% and DrySign users grew 170% with a strong pipeline of additional solutions. |
Operating leverage improvement continues:
| · | Real estate: 25% of the announced reduction in facilities already completed as part of a multi-year plan |
| · | Automation led efficiencies reduced employee count to 18,400 as of March 31, 2021 from 19,000 as of December 31, 2020 |
| · | Exela cloud hosted services expanding with Intelligent Data Processing (IDP) to additional industries; will further enhance WFA initiatives and business continuity globally with faster deployments, greater security and increased autonomy. |
Capital Expenditures: Capital expenditures for the first quarter of 2021 were 0.8% of revenue compared to 1.3% of revenue in the first quarter of 2020.
Balance Sheet and Liquidity(7): On March 31, 2021, Exela’s total liquidity was $62 million. Additionally, $53 million of committed facility under the existing Securitization Facility remains undrawn in accordance with its terms. Exela’s total net debt at March 31, 2021 was $1.48 billion (as determined in accordance with the Company's credit agreement).
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Expanding financial flexibility: Raised $26.8 million in gross proceeds via an equity offering
On March 18, 2021, Exela completed the sale of 9,731,819 shares of common stock at a price of $2.75 per share and warrants to purchase 9,731,819 shares of common stock at an exercise price of $4.00 per share to equity focused investors. The gross proceeds to Exela from this offering were approximately $26.8 million excluding placement agent fees and other offering expenses.
Exela plans to continue working on expanding its financial flexibility with the objective to improve consolidated cash flows from all activities.
2021 Guidance
| · | Revenue range $1.25 billion to $1.39 billion |
| · | Gross margin of 23% to 25% |
| · | Adjusted EBITDA margin 16% to 17% |
| · | Capital expenditures in the range of 1% of revenue |
Note: Guidance is based on constant-currency.
Below are the notes referenced above:
(1) – Gross Profit is defined as Revenue less cost of revenue excluding depreciation and amortization.
(2) – EBITDA is a non-GAAP measure. A reconciliation of EBITDA is attached to this release.
(3) – Adjusted EBITDA is a non-GAAP measure. A reconciliation of Adjusted EBITDA is attached to this release. A reconciliation of Adjusted EBITDA (2021 Guidance) is not available on forward-looking basis without unreasonable efforts due to the impact and timing on future operating results.
(4) – Gross proceeds of $26.8 million from the Equity offering are before any fees and expenses. Please refer to the equity capital raise related press release dated March 15,, 2021 and Form 8-K dated March 19, 2021 for more details.
(5) – Transition revenue includes
the exit of contracts and statements of work from certain customers that the Company believes are unpredictable, non-recurring, and were
not a strategic fit to its long-term success or unlikely to achieve long-term target margins.
(6) – Pass through revenue is defined as postage and postage handling revenue with either zero or nominal margins. A reconciliation
of revenue net of pass through revenue is attached to this release.
(7) – Liquidity is defined per the third amendment to the Company’s credit agreement effective May 15, 2020.
At March 31, 2021, total cash and cash equivalents was $22 million (including restricted cash not subject to legal restriction).
The Company had $20 million availability under its global credit facilities.
Earnings Conference Call and Audio Webcast
Exela will host a conference call to discuss its first quarter 2021 financial results at 11:00 a.m. ET on May 4, 2021. To access this call, dial 833-255-2831 or +1-412-902-6724 (international). A replay of this conference call will be available through May 1, 2021 at 877-344-7529 or +1-412-317-0088 (international). The replay passcode is 10155612.
Exela invites all investors to ask questions that they would like addressed on the conference call. We ask individual investors to submit questions via email to IR@exelatech.com.
A live webcast of this conference call will be available on the “Investors” page of the Company’s website (www.exelatech.com). A supplemental slide presentation that accompanies this call and webcast can be found on the investor relations website (http://investors.exelatech.com/) and will remain available after the call.
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About
Exela
Exela Technologies is a business process automation (BPA) leader, leveraging a global footprint and proprietary technology to provide digital transformation solutions enhancing quality, productivity, and end-user experience. With decades of experience operating mission-critical processes, Exela serves a growing roster of more than 4,000 customers throughout 50 countries, including over 60% of the Fortune® 100. With foundational technologies spanning information management, workflow automation, and integrated communications, Exela’s software and services include multi-industry department solution suites addressing finance and accounting, human capital management, and legal management, as well as industry-specific solutions for banking, healthcare, insurance, and public sectors. Through cloud-enabled platforms, built on a configurable stack of automation modules, and over 18,300 employees operating in 23 countries, Exela rapidly deploys integrated technology and operations as an end-to-end digital journey partner.
Find out more at www.exelatech.com
Follow
Exela on Twitter: https://twitter.com/exelatech
Follow Exela on LinkedIn: https://www.linkedin.com/company/11174620/
About Non-GAAP Financial Measures: This press release includes constant currency, EBITDA and Adjusted EBITDA, each of which is a financial measure that is not prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). Exela believes that the presentation of these non-GAAP financial measures will provide useful information to investors in assessing our financial performance, results of operations and liquidity and allows investors to better understand the trends in our business and to better understand and compare our results. Exela’s board of directors and management use constant currency, EBITDA and Adjusted EBITDA to assess Exela’s financial performance, because it allows them to compare Exela’s operating performance on a consistent basis across periods by removing the effects of Exela’s capital structure (such as varying levels of debt and interest expense, as well as transaction costs resulting from the combination of Quinpario Acquisition Corp. 2, SourceHOV Holdings, Inc. and Novitex Holdings, Inc. on July 12, 2017 (the “Novitex Business Combination”) and capital markets-based activities). Adjusted EBITDA also seeks to remove the effects of integration and related costs to achieve the savings, any expected reduction in operating expenses due to the Novitex Business Combination, asset base (such as depreciation and amortization) and other similar non-routine items outside the control of our management team. Optimization and restructuring expenses and merger adjustments are primarily related to the implementation of strategic actions and initiatives related to the Novitex Business Combination. All of these costs are variable and dependent upon the nature of the actions being implemented and can vary significantly driven by business needs. Accordingly, due to that significant variability, we exclude these charges since we do not believe they truly reflect our past, current or future operating performance. The constant currency presentation excludes the impact of fluctuations in foreign currency exchange rates. We calculate constant currency revenue and Adjusted EBITDA on a constant currency basis by converting our current-period local currency financial results using the exchange rates from the corresponding prior-period and compare these adjusted amounts to our corresponding prior period reported results. Exela does not consider these non-GAAP measures in isolation or as an alternative to liquidity or financial measures determined in accordance with GAAP. A limitation of these non-GAAP financial measures is that they exclude significant expenses and income that are required by GAAP to be recorded in Exela’s financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgments by management about which expenses and income are excluded or included in determining these non-GAAP financial measures and therefore the basis of presentation for these measures may not be comparable to similarly-titled measures used by other companies. These non-GAAP financial measures are not required to be uniformly applied, are not audited and should not be considered in isolation or as substitutes for results prepared in accordance with GAAP. Net loss is the GAAP measure most directly comparable to the non-GAAP measures presented here. For reconciliation of the comparable GAAP measures to these non-GAAP financial measures, see the schedules attached to this release.
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Forward-Looking Statements: Certain statements included in this press release are not historical facts but are forward-looking statements for purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. Forward-looking statements generally are accompanied by words such as “may”, “should”, “would”, “plan”, “intend”, “anticipate”, “believe”, “estimate”, “predict”, “potential”, “seem”, “seek”, “continue”, “future”, “will”, “expect”, “outlook” or other similar words, phrases or expressions. These forward-looking statements include statements regarding our industry, future events, estimated or anticipated future results and benefits, future opportunities for Exela, and other statements that are not historical facts. These statements are based on the current expectations of Exela management and are not predictions of actual performance. These statements are subject to a number of risks and uncertainties, including without limitation those discussed under the heading “Risk Factors” in the Annual Report. In addition, forward-looking statements provide Exela’s expectations, plans or forecasts of future events and views as of the date of this communication. Exela anticipates that subsequent events and developments will cause Exela’s assessments to change. These forward-looking statements should not be relied upon as representing Exela’s assessments as of any date subsequent to the date of this press release.
Investor
and/or Media Contacts:
Vincent Kondaveeti
E: vincent.kondaveeti@exelatech.com
T: 929-620-1849
Mary
Beth Benjamin
E: IR@exelatech.com
T: 646-277-1216
Source: Exela Technologies, Inc.
5
Exela
Technologies, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
As of March 31, 2021 and December 31, 2020
(in thousands of United States dollars except share and per share amounts)
(UNAUDITED)
| March 31, | December 31, | |||||||
| 2021 | 2020 | |||||||
| (Unaudited) | (Audited) | |||||||
| Assets | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | 22,055 | $ | 68,221 | ||||
| Restricted cash | 1,683 | 2,088 | ||||||
| Accounts receivable, net of allowance for doubtful accounts of $5,634 and $5,647, respectively | 216,077 | 206,868 | ||||||
| Related party receivables and prepaid expenses | 702 | 711 | ||||||
| Inventories, net | 14,845 | 14,314 | ||||||
| Prepaid expenses and other current assets | 33,429 | 31,091 | ||||||
| Total current assets | 288,791 | 323,293 | ||||||
| Property, plant and equipment, net of accumulated depreciation of $192,177 and $193,760, respectively | 81,862 | 87,851 | ||||||
| Operating lease right-of-use assets, net | 66,743 | 68,861 | ||||||
| Goodwill | 359,309 | 359,781 | ||||||
| Intangible assets, net | 280,891 | 292,664 | ||||||
| Deferred income tax assets | 6,370 | 6,606 | ||||||
| Other noncurrent assets | 20,756 | 18,723 | ||||||
| Total assets | $ | 1,104,722 | $ | 1,157,779 | ||||
| Liabilities and Stockholders' Equity (Deficit) | ||||||||
| Liabilities | ||||||||
| Current liabilities | ||||||||
| Accounts payable | $ | 73,666 | $ | 76,027 | ||||
| Related party payables | 124 | 97 | ||||||
| Income tax payable | 1,531 | 2,466 | ||||||
| Accrued liabilities | 122,080 | 126,399 | ||||||
| Accrued compensation and benefits | 62,392 | 63,467 | ||||||
| Accrued interest | 24,059 | 48,769 | ||||||
| Customer deposits | 17,648 | 21,277 | ||||||
| Deferred revenue | 21,182 | 16,377 | ||||||
| Obligation for claim payment | 28,222 | 29,328 | ||||||
| Current portion of finance lease liabilities | 11,143 | 12,231 | ||||||
| Current portion of operating lease liabilities | 17,852 | 18,349 | ||||||
| Current portion of long-term debts | 39,713 | 39,952 | ||||||
| Total current liabilities | 419,612 | 454,739 | ||||||
| Long-term debt, net of current maturities | 1,499,031 | 1,498,004 | ||||||
| Finance lease liabilities, net of current portion | 11,401 | 13,287 | ||||||
| Pension liabilities, net | 35,335 | 35,515 | ||||||
| Deferred income tax liabilities | 9,154 | 9,569 | ||||||
| Long-term income tax liabilities | 2,260 | 2,759 | ||||||
| Operating lease liabilities, net of current portion | 54,929 | 56,814 | ||||||
| Other long-term liabilities | 13,336 | 13,624 | ||||||
| Total liabilities | 2,045,058 | 2,084,311 | ||||||
| Commitments and Contingencies (Note 8) | ||||||||
| Stockholders' equity (deficit) | ||||||||
| Common stock, par value of $0.0001 per share; 1,600,000,000 shares authorized; 61,643,718 shares issued and 59,192,012 shares outstanding at March 31, 2021 and 51,693,931 shares issued and 49,242,225 shares outstanding at December 31, 2020 | 16 | 15 | ||||||
| Preferred stock, par value of $0.0001 per share; 20,000,000 shares authorized; 2,779,369 shares issued and outstanding at March 31, 2021 and 3,290,050 shares issued and outstanding at December, 2020 | 1 | 1 | ||||||
| Additional paid in capital | 471,804 | 446,739 | ||||||
| Less: Common Stock held in treasury, at cost; 2,451,706 shares at March 31, 2021 and December 31, 2020 | (10,949 | ) | (10,949 | ) | ||||
| Equity-based compensation | 52,570 | 52,183 | ||||||
| Accumulated deficit | (1,429,238 | ) | (1,390,038 | ) | ||||
| Accumulated other comprehensive loss: | ||||||||
| Foreign currency translation adjustment | (7,319 | ) | (7,419 | ) | ||||
| Unrealized pension actuarial losses, net of tax | (17,221 | ) | (17,064 | ) | ||||
| Total accumulated other comprehensive loss | (24,540 | ) | (24,483 | ) | ||||
| Total stockholders' deficit | (940,336 | ) | (926,532 | ) | ||||
| Total liabilities and stockholders' deficit | $ | 1,104,722 | $ | 1,157,779 | ||||
6
Exela
Technologies, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
For the three months ended March 31, 2021 and 2020
(in thousands of United States dollars except share and per share amounts)
(UNAUDITED)
| Three Months Ended March 31, | ||||||||
| 2021 | 2020 | |||||||
| Revenue | $ | 300,056 | $ | 365,451 | ||||
| Cost of revenue (exclusive of depreciation and amortization) | 232,587 | 292,539 | ||||||
| Selling, general and administrative expenses (exclusive of depreciation and amortization) | 41,885 | 50,374 | ||||||
| Depreciation and amortization | 19,599 | 23,185 | ||||||
| Related party expense | 1,707 | 1,551 | ||||||
| Operating profit (loss) | 4,278 | (2,198 | ) | |||||
| Other expense (income), net: | ||||||||
| Interest expense, net | 43,131 | 41,588 | ||||||
| Sundry expense, net | 213 | 1,082 | ||||||
| Other expense (income), net | 152 | (34,657 | ) | |||||
| Net loss before income taxes | (39,218 | ) | (10,211 | ) | ||||
| Income tax benefit (expense) | 18 | (2,459 | ) | |||||
| Net loss | $ | (39,200 | ) | $ | (12,670 | ) | ||
| Cumulative dividends for Series A Preferred Stock | 896 | 1,440 | ||||||
| Net loss attributable to common stockholders | $ | (38,304 | ) | $ | (11,230 | ) | ||
| Loss per share: | ||||||||
| Basic and diluted | $ | (0.76 | ) | $ | (0.23 | ) | ||
7
Exela Technologies, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
For the three months ended March 31, 2021 and 2020
(in thousands of United States dollars unless otherwise stated)
(UNAUDITED)
| Three Months Ended March 31, | ||||||||
| 2021 | 2020 | |||||||
| Cash flows from operating activities | ||||||||
| Net loss | $ | (39,200 | ) | $ | (12,670 | ) | ||
| Adjustments to reconcile net loss | ||||||||
| Depreciation and amortization | 19,599 | 23,185 | ||||||
| Original issue discount and debt issuance cost amortization | 3,840 | 3,193 | ||||||
| Provision for doubtful accounts | 50 | 74 | ||||||
| Deferred income tax provision | (297 | ) | (401 | ) | ||||
| Share-based compensation expense | 387 | 861 | ||||||
| Unrealized foreign currency losses | (159 | ) | (936 | ) | ||||
| Loss (gain) on sale of assets | 29 | (35,246 | ) | |||||
| Fair value adjustment for interest rate swap | (125 | ) | 845 | |||||
| Change in operating assets and liabilities, net of effect from acquisitions | ||||||||
| Accounts receivable | (11,248 | ) | 13,476 | |||||
| Prepaid expenses and other assets | (5,895 | ) | (5,678 | ) | ||||
| Accounts payable and accrued liabilities | (30,787 | ) | (21,420 | ) | ||||
| Related party payables | 37 | (568 | ) | |||||
| Additions to outsource contract costs | (156 | ) | (88 | ) | ||||
| Net cash used in operating activities | (63,925 | ) | (35,373 | ) | ||||
| Cash flows from investing activities | ||||||||
| Purchase of property, plant and equipment | (1,609 | ) | (3,591 | ) | ||||
| Additions to internally developed software | (672 | ) | (1,153 | ) | ||||
| Cash paid for acquisition, net of cash received | - | (3,500 | ) | |||||
| Proceeds from sale of assets | - | 38,222 | ||||||
| Net cash provided by (used in) investing activities | (2,281 | ) | 29,978 | |||||
| Cash flows from financing activities | ||||||||
| Proceeds from issuance of stock | 25,065 | - | ||||||
| Borrowings under factoring arrangement and Securitization Facilities | 32,432 | 131,591 | ||||||
| Principal repayment on borrowings under factoring arrangement and Securitization Facilities | (31,533 | ) | (23,042 | ) | ||||
| Lease terminations | (16 | ) | (14 | ) | ||||
| Cash paid for debt issuance costs | - | (2,908 | ) | |||||
| Principal payments on finance lease obligations | (3,029 | ) | (3,187 | ) | ||||
| Borrowings from senior secured revolving facility | 3,000 | 29,750 | ||||||
| Repayments on senior secured revolving facility | - | (14,000 | ) | |||||
| Borrowings from other loans | 1,959 | 11,241 | ||||||
| Principal repayments on senior secured term loans and other loans | (8,142 | ) | (15,343 | ) | ||||
| Net cash provided by financing activities | 19,736 | 114,088 | ||||||
| Effect of exchange rates on cash | (101 | ) | (216 | ) | ||||
| Net decrease in cash and cash equivalents | (46,571 | ) | 108,477 | |||||
| Cash, restricted cash, and cash equivalents | ||||||||
| Beginning of period | 70,309 | 14,099 | ||||||
| End of period | $ | 23,738 | $ | 122,576 | ||||
| Supplemental cash flow data: | ||||||||
| Income tax payments, net of refunds received | $ | 1,510 | $ | 623 | ||||
| Interest paid | 62,510 | 61,852 | ||||||
| Noncash investing and financing activities: | ||||||||
| Assets acquired through right-of-use arrangements | 220 | 270 | ||||||
| Accrued capital expenditures | 1,617 | 1,565 | ||||||
8
Exela
Technologies
Schedule 1: First Quarter 2021 vs. First Quarter 2020 Financial Performance
(UNAUDITED)
| $ in millions | Q1'21 | Q1'20 | Change ($) | |||||||||
| Information and Transaction Processing Solutions | 231.9 | 284.1 | (52.2 | ) | ||||||||
| Healthcare Solutions | 51.1 | 64.0 | (12.9 | ) | ||||||||
| Legal and Loss Prevention Services | 17.1 | 17.3 | (0.2 | ) | ||||||||
| Total Revenue | 300.1 | 365.5 | (65.4 | ) | ||||||||
| Cost of revenue (exclusive of depreciation and amortization) | 232.6 | 292.5 | (60.0 | ) | ||||||||
| Gross profit | 67.5 | 72.9 | (5.4 | ) | ||||||||
| as a % of revenue | 22 | % | 20 | % | 2.5 | % | ||||||
| SG&A | 41.9 | 50.4 | (8.5 | ) | ||||||||
| Depreciation and amortization | 19.6 | 23.2 | (3.6 | ) | ||||||||
| Related party expense | 1.7 | 1.6 | 0.2 | |||||||||
| Operating (loss) income | 4.3 | (2.2 | ) | 6.5 | ||||||||
| as a % of revenue | 1 | % | -1 | % | 2.0 | % | ||||||
| Interest expense, net | 43.1 | 41.6 | 1.5 | |||||||||
| Sundry expense (income) & Other income, net | 0.4 | (33.6 | ) | 33.9 | ||||||||
| Net loss before income taxes | (39.2 | ) | (10.2 | ) | (29.0 | ) | ||||||
| Income tax expense (benefit) | (0.0 | ) | 2.5 | (2.5 | ) | |||||||
| Net income (loss) | (39.2 | ) | (12.7 | ) | (26.5 | ) | ||||||
| as a % of revenue | -13 | % | -3 | % | -9.6 | % | ||||||
| Depreciation and amortization | 19.6 | 23.2 | (3.6 | ) | ||||||||
| Interest expense, net | 43.1 | 41.6 | 1.5 | |||||||||
| Income tax expense (benefit) | (0.0 | ) | 2.5 | (2.5 | ) | |||||||
| EBITDA | 23.5 | 54.6 | (31.1 | ) | ||||||||
| as a % of revenue | 8 | % | 15 | % | -7.1 | % | ||||||
| EBITDA Adjustments | ||||||||||||
| Gain / loss on derivative instruments | (0.1 | ) | 0.8 | (1.0 | ) | |||||||
| Non-Cash and Other Charges | 13.1 | (28.5 | ) | 41.6 | ||||||||
| Transaction and integration costs | 4.6 | 4.4 | 0.3 | |||||||||
| Sub-Total (Adj. EBITDA before O&R) | 41.1 | 31.2 | 9.9 | |||||||||
| Optimization and restructuring expenses | 5.4 | 13.1 | (7.8 | ) | ||||||||
| Adjusted EBITDA | 46.5 | 44.4 | 2.1 | |||||||||
| as a % of revenue | 15.5 | % | 12.1 | % | 3.3 | % | ||||||
9
Exela
Technologies
Schedule 2: Reconciliation of Adjusted EBITDA and constant currency revenues
| Reconciliation of Non-GAAP Financial Measures to GAAP Measures | ||||||||
| Non-GAAP constant currency revenue reconciliation | ||||||||
| ($ in millions) | Three months ended | |||||||
| 31-Mar-21 | 31-Mar-20 | |||||||
| Revenues, as reported (GAAP) | $ | 300.1 | $ | 365.5 | ||||
| Foreign currency exchange impact (1) | (5.1 | ) | ||||||
| Revenues, at constant currency (Non-GAAP) | $ | 294.9 | $ | 365.5 | ||||
| (1) Constant currency excludes the impact of foreign currency fluctuations and is computed by applying the average exchange rates for the three months ended March 31, 2020, to the revenues during the corresponding period in 2021. |
| Reconciliation of Adjusted EBITDA | ||||||||
| Three months ended | ||||||||
| ($ in millions) | 31-Mar-21 | 31-Mar-20 | ||||||
| Net loss (GAAP) | $ | (39.2 | ) | $ | (12.7 | ) | ||
| Interest expense | 43.1 | 41.6 | ||||||
| Taxes | (0.0 | ) | 2.5 | |||||
| Depreciation and amortization | 19.6 | 23.2 | ||||||
| EBITDA (Non-GAAP) | $ | 23.5 | $ | 54.6 | ||||
| Transaction and integration costs | 4.6 | 4.4 | ||||||
| Optimization and restructuring expenses | 5.4 | 13.1 | ||||||
| Gain / loss on derivative instruments | (0.1 | ) | 0.8 | |||||
| Other Charges | 13.1 | (28.5 | ) | |||||
| Adjusted EBITDA (Non-GAAP) | $ | 46.5 | $ | 44.4 | ||||
| Foreign currency exchange impact (1) | - | |||||||
| Adjusted EBITDA, at constant currency (Non-GAAP) | $ | 46.5 | $ | 44.4 | ||||
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| (1) Constant currency excludes the impact of foreign currency fluctuations and is computed by applying the average exchange rates for the three months March 31, 2020, to the adjusted EBITDA during the corresponding period in 2021. |
| Schedule 3: Non-GAAP Revenue reconciliation & Adjusted EBITDA margin on Revenue net of pass through |
| Three months ended | ||||||||
| ($ in millions) | 31-Mar-21 | 31-Mar-20 | ||||||
| Revenues, as reported (GAAP) | $ | 300.1 | $ | 365.5 | ||||
| (-) Postage & postage handling | 59.3 | 69.7 | ||||||
| Revenue - Net of pass through (Non-GAAP) | $ | 240.7 | $ | 295.7 | ||||
| Revenue growth % | (18.6 | )% | ||||||
| Adjusted EBITDA (Non-GAAP) | $ | 46.5 | $ | 44.4 | ||||
| Adjusted EBITDA margin | 19.3 | % | 15.0 | % | ||||
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