Slide 1: Third Quarter 2023 Financial Results
Third Quarter 2023 Financial Results November 8, 2023 © Copyright 2023 Certara, L.P. All rights reserved.
Slide 2: Disclaimer
Disclaimer Numerical figures in the presentation have been subject to rounding adjustments. Accordingly, numerical figures shown as totals in various tables may not be arithmetic aggregations of the figures that precede them. Trademarks and Service Marks The Certara design logo, “Certara,” and our o
Slide 3: Certara at a Glance
Certara at a Glance BUSINESS(1) END-TO-END PLATFORM CUSTOMERS(3) 3Q23 FINANCIALS Software 20+ Year 2,300+ $85.6M Revenue • Biosimulation Customers across History of innovation • Regulatory & compliance 70 countries 1% GAAP YoY Growth • Market access 0% CC YoY Growth(4) 1,200+ Employees 10+ Year Tech
Slide 4: Financial Highlights Third Quarter 2023
Financial Highlights Third Quarter 2023 Adjusted Revenue Net Income(2) Adj. EBITDA(3) Diluted EPS Diluted EPS(4) $85.6M ($49.0M) $28.8M ($0.31) $0.11 1% GAAP YoY change PY $3.9M PY $32.7M PY $0.02 PY $0.10 0% CC YoY change (1) (1) See Appendix for reconciliation of GAAP revenue to constant currency
Slide 5: 3Q 2023 Results - Revenue
3Q 2023 Results - Revenue GAAP Reported Revenue Constant Currency Revenue(1) ($Millions) ($Millions) 84.7 85.6 84.7 84.6 56.3 54.2 56.3 53.8 28.4 31.3 28.4 30.8 3Q 2022 3Q 2023 3Q 2022 3Q 2023 Software Services Software Services Certara reported 1% revenue growth (1) See Appendix for reconciliation
Slide 6: 3Q and TTM Results - Net Bookings
3Q and TTM Results - Net Bookings 3Q Reported Net Bookings TTM Reported Net Bookings ($Millions) ($Millions) 84.8 401.0 403.8 79.8 54.4 57.6 283.4 270.7 25.4 27.2 133.1 117.6 3Q 2022 3Q 2023 PY TTM TTM Software Services Software Services Trailing twelve months bookings are highly correlated with rev
Slide 7: Software Historical Aggregate Renewal Rate (ARR)
Software Historical Aggregate Renewal Rate (ARR) 96% 93% 93% 92% 92% 92% 90% 90% 88% 87% 86% 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 Certara has delivered a consistently high ARR over time © Copyright 2023 Certara, L.P. All rights reserved.
Slide 8: Historical TTM Book to Bill
Historical TTM Book to Bill 1.24x 1.22x 1.20x ($Millions) 1.13x 1.14x 401.0 408.9 413.1 398.4 403.8 335.6 344.4 352.1 353.0 324.4 3Q 2022 4Q 2022 1Q 2023 2Q 2023 3Q 2023 TTM Bookings TTM Revenue Book to Bill Book to bill provides forward visibility into revenue growth © Copyright 2023 Certara, L.P.
Slide 9: 3Q 2023 Results – Adjusted EBITDA
3Q 2023 Results – Adjusted EBITDA Adjusted EBITDA(1) 32.7 28.8 3Q 2022 3Q 2023 39% Adjusted EBITDA Margin(1) 34% (1) See Appendix for a reconciliation net income (loss) to adjusted EBITDA © Copyright 2023 Certara, L.P. All rights reserved.
Slide 10: 3Q23 Business Updates
3Q23 Business Updates Key Takeaways from Third Quarter Performance: Revenue $90.5M Early Signs of Market Stabilization Innovative Software Development Reaping the Benefits of Strategic Changes • Introduction of CoAuthor AI/ML • Stabilization in activity across the enhanced regulatory software with •
Slide 11: 3Q23 Bookings Trends – Pharma/Biotech Customers
3Q23 Bookings Trends – Pharma/Biotech Customers (1) Tier Software Bookings Services Bookings I Average deal size had strong growth, offset by lower deal count related to timing Growth in-line with historical company averages, driven by increase in average deal size II Strongest area of growth in sof
Slide 12: 2023 Outlook
2023 Outlook Reiterated full-year 2023 guidance: Key Assumptions 2023 Guidance • Reported revenue growth of 3-7% Adjusted Adjusted Revenue EBITDA(1) Diluted EPS(1) • 35-36% EBITDA Margin $345-$360M $120-$128M $0.44-$0.48 • Fully diluted shares expected to be in the range of 159- 162M • Tax rate expe
Slide 13: Appendix
Appendix © Copyright 2023 Certara, L.P. All rights reserved.
Slide 14: Reconciliation of Net Income (Loss) to Adjusted EBITDA
Reconciliation of Net Income (Loss) to Adjusted EBITDA THREE MONTHS ENDED NINE MONTHS ENDED SEPTEMBER 30, SEPTEMBER 30, 2023 2022 2023 2022 ( in thousands) Net income (loss)(a) $ (48,965) $ 3,936 $ (42,901) $ 5,557 Interest expense(a) 5,903 5,221 17,046 12,328 Interest income(a) (2,864) (322) (6,428
Slide 15: Reconciliation of Net Income (Loss) to Adjusted Net Income (Loss)
Reconciliation of Net Income (Loss) to Adjusted Net Income (Loss) THREE MONTHS ENDED NINE MONTHS ENDED SEPTEMBER 30, SEPTEMBER 30, 2023 2022 2023 2022 (in thousands) Net income (loss) (a) $ (48,965) $ 3,936 $ (42,901) $ 5,557 Currency (gain) loss(a) (2,179) (2,376) (165) (5,639) Equity-based compens
Slide 16: Reconciliation of Diluted EPS to Adjusted Diluted EPS
Reconciliation of Diluted Earnings Per Share to Adjusted Diluted Earnings Per Share THREE MONTHS ENDED NINE MONTHS ENDED SEPTEMBER 30, SEPTEMBER 30, 2023 2022 2023 2022 (In thousands except share and per share data) Diluted earnings per share(a) $ (0.31) $ 0.02 $ (0.27) $ 0.03 Currency (gain) loss(a
Slide 17: Reconciliation of Revenues to Constant Currency Revenues
Reconciliation of Revenues to the Revenues Adjusted for Constant Currency THREE MONTHS ENDED SEPTEMBER 30, CHANGE 2023 2023 2022 $ % $ % Actual CC Actual Actual Actual CC Impact (GAAP) (non-GAAP) (GAAP) (GAAP) (GAAP) (non-GAAP) (non-GAAP) (in thousands except percentage) Revenue Software $ 31,331 $
Slide 18: Notes to Reconciliations
Notes to Reconciliations (a) Represents amounts as determined under GAAP. (b) Represents expense related to equity-based compensation. Equity-based compensation has been, and will continue to be for the foreseeable future, a recurring expense in our business and an important part of our compensation
Slide 19: Accelerating Medicines, Together
Accelerating Medicines, Together © Copyright 2023 Certara, L.P. All rights reserved.