– Q4 SaaS Adjusted EBITDA exceeds mid-point of guidance by over $2.75 million – NDR increases 400 bps sequentially to 96% – Company generates strong FY operating cash flow of $148.2 million
DALLAS--(BUSINESS WIRE)-- Thryv Holdings, Inc. (NASDAQ:THRY) (“Thryv” or the “Company”), the provider of Thryv®, the leading small business software platform, reported SaaS revenue growth of 25% year-over-year in the fourth quarter of 2023.
“We are proud to announce robust fourth-quarter and full-year results, marking another successful year for Thryv,” said Joe Walsh, Thryv Chairman, and CEO. “We surpassed guidance on SaaS revenue growth and SaaS Adjusted EBITDA, underscoring our commitment to delivering profitable SaaS growth. Looking ahead to 2024, we plan to accelerate SaaS revenue growth and drive margin expansion by empowering our legacy digital clients to seamlessly transition to the Thryv SaaS platform, enabling them to access an advanced multi-center platform that addresses their everyday needs.”
Also today, Thryv has issued a press release outlining increasing adoption of the SaaS platform by legacy clients.
“For the fourth quarter, Thryv achieved record SaaS revenue growth of 25% year-over-year,” stated Paul Rouse, Chief Financial Officer. “Simultaneously, we delivered record SaaS Adjusted Gross profit margin of 70% and surpassed our SaaS Adjusted EBITDA guidance.” Rouse continued, “We generated strong free cash flow in 2023 which enabled us to pay down $120 million towards our term loan, exceeding expectations and further solidifying our financial position. As we move forward, our primary focus is to accelerate profitable growth in the SaaS business while maintaining a strong and healthy balance sheet.”
Fourth Quarter 2023 Highlights:
- Total SaaS1 revenue was $74.0 million, a 25% increase year-over-year
- Total Marketing Services2 revenue was $162.2 million, a 26% decrease year-over-year
- Consolidated total revenue was $236.2 million, a decrease of 15% year-over-year
- Consolidated net loss was $257.5 million, or $(7.39) per diluted share, which includes a non-cash charge of $268.8 million, or $7.71 per diluted share, related to goodwill impairment; compared to net loss of $50.4 million, or $(1.47) per diluted share, for the fourth quarter of 2022
- Consolidated Adjusted EBITDA was $52.3 million, representing an Adjusted EBITDA margin of 22%
- Total SaaS Adjusted EBITDA was $6.5 million, representing an Adjusted EBITDA margin of 8.8%
- Total Marketing Services Adjusted EBITDA was $45.8 million, representing an Adjusted EBITDA margin of 28.2%
- Consolidated Gross Profit was $159.7 million
- Consolidated Adjusted Gross Profit3 was $165.4 million
- SaaS Gross Profit was $50.0 million
- SaaS Adjusted Gross Profit was $51.6 million, representing an Adjusted Gross Profit Margin of 70%
- Operating cash flow was $44.6 million compared to $44.4 million for the fourth quarter of 2022
- Free cash flow was $34.1 million compared to $34.5 million for the fourth quarter of 2022
Full-Year 2023 Financial Highlights:
- Total SaaS1 revenue was $263.7 million, a 21.9% increase year-over-year
- Total Marketing Services2 revenue was $653.2 million, a 33.8% decrease year-over-year
- Consolidated total revenue was $917.0 million, a decrease of 24% year-over-year
- Consolidated net loss was $259.3 million, or $(7.47) per diluted share, which includes a non-cash charge of $268.8 million related to goodwill impairment; compared to net income of $54.3 million, or $1.49 per diluted share, for last year
- Consolidated Adjusted EBITDA was $187.5 million, representing an Adjusted EBITDA margin of 20.4%
- Total SaaS Adjusted EBITDA was $12.0 million, representing an Adjusted EBITDA margin of 4.6%
- Total Marketing Services Adjusted EBITDA was $175.5 million, representing an Adjusted EBITDA margin of 26.9%
- Consolidated Gross Profit was $578.2 million
- Consolidated Adjusted Gross Profit3 was $605.8 million
- SaaS Gross Profit was $169.2 million
- SaaS Adjusted Gross Profit was $175.6 million, representing an Adjusted Gross Profit Margin of 66.6%
- Operating cash flow was $148.2 million compared to $148.6 million for the prior year
- Free cash flow was $114.8 million compared to $119.3 million for the prior year
SaaS Metrics
- Total SaaS clients increased 27% year-over-year to 66 thousand for the fourth quarter of 2023
- Seasoned Net Dollar Retention4 was 96% for the fourth quarter of 2023, an increase of 400 bps sequentially
- SaaS monthly active users5 was 40 thousand active users for the fourth quarter of 2023
- SaaS monthly Average Revenue per Unit (“ARPU”)6 decreased to $370 for the fourth quarter of 2023, compared to $387 in the fourth quarter of 2022
- ThryvPay total payment volume was $60 million, an increase of 54% year-over-year
_____________________
1 Total SaaS revenue in the U.S. and International segments was $70.7 million and $3.3 million for the three months ended December 31, 2023 and $253.6 million and $10.1 million for the year ended December 31, 2023, respectively. 2 Total Marketing Services revenue in the U.S. and International segments was $132.7 million and $29.5 million for the three months ended December 31, 2023 and $510.5 million and $142.7 million for the year ended December 31, 2023, respectively. 3 Defined as Gross profit adjusted to exclude the impact of depreciation and amortization expense and stock-based compensation expense. 4 Seasoned Net Dollar Retention is defined as net dollar retention excluding clients acquired over the previous 12 months. 5 Defined as a client with one or more users who log into our SaaS solutions at least once during the calendar month. 6 Defined as total client billings for a particular month divided by the number of clients that have one or more revenue-generating solutions in that same month. 7 These statements are forward-looking and actual results may materially differ. Refer to the “Forward-Looking Statements” section below for information on the factors that could cause our actual results to materially differ from these forward-looking statements.
Outlook
Based on information available as of February 22, 2024, Thryv is issuing guidance7 for the first quarter of 2024 and full year 2024 as indicated below:
1st Quarter |
Full Year |
||||
(in millions) |
2024 |
2024 |
|||
SaaS Revenue |
$73 - $74 |
$325 - $328 |
|||
SaaS Adjusted EBITDA |
$6 - $7 |
$26 - $29 |
1st Quarter |
2nd Quarter |
3rd Quarter |
4th Quarter |
Full Year |
|||||
(in millions) |
2024 |
2024 |
2024 |
2024 |
2024 |
||||
Marketing Services Revenue |
$152 - $155 |
$146 - $149 |
$99 - $101 |
$98 - $100 |
$495 - $505 |
||||
Marketing Services Adjusted EBITDA |
$132 - $135 |
Earnings Conference Call Information
Thryv will host a conference call on Thursday, February 22, 2024 at 8:30 a.m. (Eastern Time) to discuss the Company's fourth quarter 2023 results.
For analysts to register for this conference call, please use this link. After registering, a confirmation email will be sent, including dial-in details and a unique code for entry. We recommend registering a day in advance or at a minimum thirty minutes prior to the start of the call. To listen to the webcast, please use this link or visit Thryv's Investor Relations website at investor.thryv.com. A live webcast will also be available on the Investor Relations section of the Company's website at investor.thryv.com.
If you are unable to participate in the conference call, a replay will be available. To access the replay, please dial (800) 770-2030 or (647) 362-9199 and enter “44819.”
Thryv Holdings, Inc. and Subsidiaries Consolidated Statements of Operations and Comprehensive (Loss) Income |
|||||||||||||||
Three Months Ended |
Years Ended |
||||||||||||||
December 31, |
December 31, |
||||||||||||||
(in thousands, except share and per share data) |
2023 |
2022 |
2023 |
2022 |
|||||||||||
Revenue |
$ |
236,163 |
$ |
279,368 |
$ |
916,961 |
$ |
1,202,388 |
|||||||
Cost of services |
76,453 |
100,463 |
338,714 |
422,006 |
|||||||||||
Gross profit |
159,710 |
178,905 |
578,247 |
780,382 |
|||||||||||
Operating expenses: |
|||||||||||||||
Sales and marketing |
73,757 |
86,773 |
300,538 |
362,432 |
|||||||||||
General and administrative |
59,238 |
56,892 |
208,880 |
216,406 |
|||||||||||
Impairment charges |
268,846 |
102,000 |
268,846 |
102,222 |
|||||||||||
Total operating expenses |
401,841 |
245,665 |
778,264 |
681,060 |
|||||||||||
Operating (loss) income |
(242,131 |
) |
(66,760 |
) |
(200,017 |
) |
99,322 |
||||||||
Other income (expense): |
|||||||||||||||
Interest expense |
(13,817 |
) |
(16,318 |
) |
(61,728 |
) |
(56,902 |
) |
|||||||
Interest expense, related party |
— |
— |
— |
(3,505 |
) |
||||||||||
Other components of net periodic pension benefit |
6,607 |
39,317 |
2,719 |
44,612 |
|||||||||||
Other (expense) income |
(276 |
) |
(119 |
) |
(1,518 |
) |
15,448 |
||||||||
(Loss) income before income tax (expense) benefit |
(249,617 |
) |
(43,880 |
) |
(260,544 |
) |
98,975 |
||||||||
Income tax (expense) benefit |
(7,924 |
) |
(6,565 |
) |
1,249 |
(44,627 |
) |
||||||||
Net (loss) income |
$ |
(257,541 |
) |
$ |
(50,445 |
) |
$ |
(259,295 |
) |
$ |
54,348 |
||||
Other comprehensive income (loss): |
|||||||||||||||
Foreign currency translation adjustment, net of tax |
5,402 |
4,397 |
1,070 |
(8,214 |
) |
||||||||||
Comprehensive (loss) income |
$ |
(252,139 |
) |
$ |
(46,048 |
) |
$ |
(258,225 |
) |
$ |
46,134 |
||||
Net (loss) income per common share: |
|||||||||||||||
Basic |
$ |
(7.39 |
) |
$ |
(1.47 |
) |
$ |
(7.47 |
) |
$ |
1.58 |
||||
Diluted |
$ |
(7.39 |
) |
$ |
(1.47 |
) |
$ |
(7.47 |
) |
$ |
1.49 |
||||
Weighted-average shares used in computing basic and diluted net (loss) income per common share: |
|||||||||||||||
Basic |
34,858,157 |
34,270,520 |
34,723,491 |
34,336,493 |
|||||||||||
Diluted |
34,858,157 |
34,270,520 |
34,723,491 |
36,506,095 |
|||||||||||
Thryv Holdings, Inc. and Subsidiaries Consolidated Balance Sheets |
|||||||
(in thousands, except share data) |
December 31, 2023 |
December 31, 2022 |
|||||
Assets |
|||||||
Current assets |
|||||||
Cash and cash equivalents |
$ |
18,216 |
$ |
16,031 |
|||
Accounts receivable, net of allowance of $14,926 in 2023 and $14,766 in 2022 |
205,503 |
284,698 |
|||||
Contract assets, net of allowance of $35 in 2023 and $33 in 2022 |
2,909 |
2,583 |
|||||
Taxes receivable |
3,085 |
11,553 |
|||||
Prepaid expenses |
17,771 |
25,092 |
|||||
Indemnification asset |
— |
26,495 |
|||||
Deferred costs |
16,722 |
9,544 |
|||||
Other current assets |
2,662 |
2,320 |
|||||
Total current assets |
266,868 |
378,316 |
|||||
Fixed assets and capitalized software, net |
38,599 |
42,334 |
|||||
Goodwill |
302,400 |
566,004 |
|||||
Intangible assets, net |
18,788 |
34,715 |
|||||
Deferred tax assets |
128,051 |
113,859 |
|||||
Other assets |
28,464 |
42,649 |
|||||
Total assets |
$ |
783,170 |
$ |
1,177,877 |
|||
Liabilities and Stockholders' Equity |
|||||||
Current liabilities |
|||||||
Accounts payable |
$ |
10,348 |
$ |
18,972 |
|||
Accrued liabilities |
105,903 |
126,810 |
|||||
Current portion of unrecognized tax benefits |
23,979 |
31,919 |
|||||
Contract liabilities |
44,558 |
41,854 |
|||||
Current portion of long-term debt |
70,000 |
70,000 |
|||||
Other current liabilities |
8,402 |
10,937 |
|||||
Total current liabilities |
263,190 |
300,492 |
|||||
Term Loan, net |
230,052 |
345,256 |
|||||
ABL Facility |
48,845 |
54,554 |
|||||
Pension obligations, net |
69,388 |
72,590 |
|||||
Other liabilities |
18,995 |
22,718 |
|||||
Total long-term liabilities |
367,280 |
495,118 |
|||||
Commitments and contingencies |
|||||||
Stockholders' equity |
|||||||
Common stock - $0.01 par value, 250,000,000 shares authorized; 62,660,783 shares issued and 35,302,746 shares outstanding at December 31, 2023; and 61,279,379 shares issued and 34,593,837 shares outstanding at December 31, 2022 |
627 |
613 |
|||||
Additional paid-in capital |
1,151,259 |
1,105,701 |
|||||
Treasury stock - 27,358,037 shares at December 31, 2023 and 26,685,542 shares at December 31, 2022 |
(485,793 |
) |
(468,879 |
) |
|||
Accumulated other comprehensive loss |
(15,191 |
) |
(16,261 |
) |
|||
Accumulated deficit |
(498,202 |
) |
(238,907 |
) |
|||
Total stockholders' equity |
152,700 |
382,267 |
|||||
Total liabilities and stockholders' equity |
$ |
783,170 |
$ |
1,177,877 |
|||
Thryv Holdings, Inc. and Subsidiaries Consolidated Statements of Cash Flows |
|||||||
Years Ended December 31, |
|||||||
(in thousands) |
2023 |
2022 |
|||||
Cash Flows from Operating Activities |
|||||||
Net (loss) income |
$ |
(259,295 |
) |
$ |
54,348 |
||
Adjustments to reconcile net (loss) income to net cash provided by operating activities: |
|||||||
Depreciation and amortization |
63,251 |
88,392 |
|||||
Amortization of deferred commissions |
14,954 |
12,110 |
|||||
Amortization of debt issuance costs |
5,422 |
5,749 |
|||||
Deferred income taxes |
(12,904 |
) |
(15,119 |
) |
|||
Provision for credit losses and service credits |
24,516 |
25,971 |
|||||
Stock-based compensation expense |
22,201 |
14,628 |
|||||
Other components of net periodic pension (benefit) |
(2,719 |
) |
(44,612 |
) |
|||
Impairment charges |
268,846 |
102,222 |
|||||
Non-cash loss (gain) from the remeasurement of the indemnification asset |
10,734 |
(2,148 |
) |
||||
Bargain purchase gain |
— |
(10,883 |
) |
||||
Other |
603 |
(2,309 |
) |
||||
Changes in working capital items, excluding acquisitions: |
|||||||
Accounts receivable |
54,325 |
(5,242 |
) |
||||
Contract assets |
(326 |
) |
2,764 |
||||
Prepaid expenses and other assets |
7,117 |
(9,592 |
) |
||||
Accounts payable and accrued liabilities |
(37,749 |
) |
(41,105 |
) |
|||
Other liabilities |
(10,750 |
) |
(26,601 |
) |
|||
Net cash provided by operating activities |
148,226 |
148,573 |
|||||
Cash Flows from Investing Activities |
|||||||
Additions to fixed assets and capitalized software |
(33,394 |
) |
(29,233 |
) |
|||
Acquisition of a business, net of cash acquired |
(8,897 |
) |
(22,793 |
) |
|||
Other |
(225 |
) |
— |
||||
Net cash used in investing activities |
(42,516 |
) |
(52,026 |
) |
|||
Cash Flows from Financing Activities |
|||||||
Payments of Term Loan |
(120,000 |
) |
(104,165 |
) |
|||
Payments of Term Loan, related party |
— |
(8,347 |
) |
||||
Proceeds from ABL Facility |
919,975 |
976,296 |
|||||
Payments of ABL Facility |
(925,684 |
) |
(961,670 |
) |
|||
Proceeds from exercises of stock warrants |
15,898 |
64 |
|||||
Other |
6,318 |
6,725 |
|||||
Net cash used in financing activities |
(103,493 |
) |
(91,097 |
) |
|||
Effect of exchange rate changes on cash, cash equivalents and restricted cash |
133 |
(827 |
) |
||||
Increase in cash, cash equivalents and restricted cash |
2,350 |
4,623 |
|||||
Cash, cash equivalents and restricted cash, beginning of period |
18,180 |
13,557 |
|||||
Cash, cash equivalents and restricted cash, end of period |
$ |
20,530 |
$ |
18,180 |
|||
Supplemental Information |
|||||||
Cash paid for interest |
$ |
57,027 |
$ |
57,084 |
|||
Cash paid for income taxes, net |
$ |
9,313 |
$ |
58,259 |
|||
Non-cash investing and financing activities |
|||||||
Repurchase of Treasury stock as a result of the settlement of the indemnification asset |
$ |
15,760 |
$ |
— |
|||
The following tables summarize the operating results of the Company's reportable segments:
Three Months Ended December 31, |
Change |
|||||||||||||
(in thousands) |
2023 |
2022 |
Amount |
% |
||||||||||
Revenue |
||||||||||||||
Thryv U.S. |
||||||||||||||
Marketing Services |
$ |
132,665 |
$ |
187,755 |
$ |
(55,090 |
) |
(29.3 |
)% |
|||||
SaaS |
70,652 |
57,938 |
12,714 |
21.9 |
% |
|||||||||
Thryv International |
||||||||||||||
Marketing Services |
29,528 |
32,295 |
(2,767 |
) |
(8.6 |
)% |
||||||||
SaaS |
3,318 |
1,380 |
1,938 |
140.4 |
% |
|||||||||
Consolidated Revenue |
$ |
236,163 |
$ |
279,368 |
$ |
(43,205 |
) |
(15.5 |
)% |
|||||
Segment Gross Profit |
||||||||||||||
Thryv U.S. |
||||||||||||||
Marketing Services |
$ |
88,520 |
$ |
124,413 |
$ |
(35,893 |
) |
(28.8 |
)% |
|||||
SaaS |
47,183 |
34,944 |
12,239 |
35.0 |
% |
|||||||||
Thryv International |
||||||||||||||
Marketing Services |
21,232 |
18,802 |
2,430 |
12.9 |
% |
|||||||||
SaaS |
2,775 |
746 |
2,029 |
NM |
||||||||||
Consolidated Segment Gross Profit |
$ |
159,710 |
$ |
178,905 |
$ |
(19,195 |
) |
(10.7 |
)% |
|||||
Segment EBITDA |
||||||||||||||
Thryv U.S. |
||||||||||||||
Marketing Services |
$ |
38,383 |
$ |
59,758 |
$ |
(21,375 |
) |
(35.8 |
)% |
|||||
SaaS |
8,345 |
83 |
8,262 |
NM |
||||||||||
Thryv International |
||||||||||||||
Marketing Services |
7,390 |
10,657 |
(3,267 |
) |
(30.7 |
)% |
||||||||
SaaS |
(1,842 |
) |
(2,305 |
) |
463 |
20.1 |
% |
|||||||
Consolidated Adjusted EBITDA |
$ |
52,276 |
$ |
68,193 |
$ |
(15,917 |
) |
(23.3 |
)% |
|||||
Years Ended December 31, |
Change |
|||||||||||||
(in thousands) |
2023 (1 |
) |
2022 (2 |
) |
Amount |
% |
||||||||
Revenue |
||||||||||||||
Thryv U.S. |
||||||||||||||
Marketing Services |
$ |
510,533 |
$ |
820,032 |
$ |
(309,499 |
) |
(37.7 |
)% |
|||||
SaaS |
253,579 |
211,801 |
41,778 |
19.7 |
% |
|||||||||
Thryv International |
||||||||||||||
Marketing Services |
142,711 |
166,010 |
(23,299 |
) |
(14.0 |
)% |
||||||||
SaaS |
10,138 |
4,545 |
5,593 |
123.1 |
% |
|||||||||
Consolidated Revenue |
$ |
916,961 |
$ |
1,202,388 |
$ |
(285,427 |
) |
(23.7 |
)% |
|||||
Segment Gross Profit |
||||||||||||||
Thryv U.S. |
||||||||||||||
Marketing Services |
$ |
320,327 |
$ |
539,543 |
$ |
(219,216 |
) |
(40.6 |
)% |
|||||
SaaS |
161,663 |
130,272 |
31,391 |
24.1 |
% |
|||||||||
Thryv International |
||||||||||||||
Marketing Services |
88,730 |
108,496 |
(19,766 |
) |
(18.2 |
)% |
||||||||
SaaS |
7,527 |
2,071 |
5,456 |
NM |
||||||||||
Consolidated Segment Gross Profit |
$ |
578,247 |
$ |
780,382 |
$ |
(202,135 |
) |
(25.9 |
)% |
|||||
Segment EBITDA |
||||||||||||||
Thryv U.S. |
||||||||||||||
Marketing Services |
$ |
123,249 |
$ |
271,629 |
$ |
(148,380 |
) |
(54.6 |
)% |
|||||
SaaS |
18,576 |
(3,686 |
) |
22,262 |
NM |
|||||||||
Thryv International |
||||||||||||||
Marketing Services |
52,241 |
75,106 |
(22,865 |
) |
(30.4 |
)% |
||||||||
SaaS |
(6,551 |
) |
(9,707 |
) |
3,156 |
32.5 |
% |
|||||||
Consolidated Adjusted EBITDA |
$ |
187,515 |
$ |
333,342 |
$ |
(145,827 |
) |
(43.7 |
)% |
|||||
| (1) | Thryv International includes Yellow's results of operations subsequent to the Yellow acquisition. |
| (2) | Thryv U.S. includes Vivial's results of operations subsequent to the Vivial acquisition. |
Non-GAAP Measures
Our results included in this press release include Adjusted EBITDA, Adjusted EBITDA margin and Adjusted Gross Profit, which are not presented in accordance with U.S. generally accepted accounting principles (“GAAP”). These non-GAAP measures are presented for supplemental informational purposes only and are not intended to be considered in isolation or as a substitute for, or superior to, financial information prepared and presented in accordance with GAAP. Please refer to the supplemental information presented in the tables below for a reconciliation of Adjusted EBITDA to Net (loss) income and Adjusted Gross Profit to Gross profit. Both Net (loss) income and Gross profit are the most comparable GAAP financial measure to Adjusted EBITDA and Adjusted Gross Profit, respectively. Adjusted EBITDA margin is defined as Adjusted EBITDA divided by revenue.
We believe that these non-GAAP financial measures provide useful information about our financial performance, enhance the overall understanding of our past performance and allow for greater transparency with respect to important metrics used by our management for financial and operational decision-making. We believe that these measures provide additional tools for investors to use in comparing our core financial performance over multiple periods with other companies in our industry. However, it is important to note that the particular items we exclude from, or include in, our non-GAAP financial measures may differ from the items excluded from, or included in, similar non-GAAP financial measures used by other companies in the same industry.
The following is a reconciliation of Adjusted EBITDA to its most directly comparable GAAP measure, Net (loss) income:
Three Months Ended December 31, |
Years Ended December 31, |
||||||||||||||
(in thousands) |
2023 |
2022 |
2023 |
2022 |
|||||||||||
Reconciliation of Adjusted EBITDA |
|||||||||||||||
Net (loss) income |
$ |
(257,541 |
) |
$ |
(50,445 |
) |
$ |
(259,295 |
) |
$ |
54,348 |
||||
Impairment charges |
268,846 |
102,000 |
268,846 |
102,222 |
|||||||||||
Depreciation and amortization expense |
16,311 |
22,438 |
63,251 |
88,392 |
|||||||||||
Interest expense |
13,817 |
16,318 |
61,728 |
60,407 |
|||||||||||
Stock-based compensation expense (1) |
5,548 |
4,488 |
22,201 |
14,628 |
|||||||||||
Restructuring and integration expenses (2) |
1,767 |
3,365 |
14,612 |
17,804 |
|||||||||||
Non-cash (gain) loss from remeasurement of indemnification asset (3) |
— |
(676 |
) |
10,734 |
(2,148 |
) |
|||||||||
Transaction costs (4) |
— |
1,322 |
373 |
6,119 |
|||||||||||
Income tax expense (benefit) |
7,924 |
6,565 |
(1,249 |
) |
44,627 |
||||||||||
Other components of net periodic pension benefit (5) |
(6,607 |
) |
(39,317 |
) |
(2,719 |
) |
(44,612 |
) |
|||||||
Other (6) |
2,211 |
2,135 |
9,033 |
(8,445 |
) |
||||||||||
Adjusted EBITDA |
$ |
52,276 |
$ |
68,193 |
$ |
187,515 |
$ |
333,342 |
|||||||
(1) |
We record stock-based compensation expense related to the amortization of grant date fair value of the Company’s stock-based compensation awards. |
(2) |
For the years ended December 31, 2023 and 2022, expenses relate to periodic efforts to enhance efficiencies and reduce costs, and include severance benefits, and costs associated with abandoned facilities and system consolidation. |
(3) |
In connection with the YP acquisition, the seller indemnified us for future potential losses associated with certain federal and state tax positions taken in tax returns filed by the seller prior to the acquisition date. |
(4) |
Expenses related to the Yellow acquisition, Vivial acquisition and other transaction costs. |
(5) |
Other components of net periodic pension benefit is from our non-contributory defined benefit pension plans that are currently frozen and incur no additional service costs. The most significant component of Other components of net periodic pension benefit relates to periodic mark-to-market pension remeasurement. |
(6) |
During the year ended December 31, 2023, Other includes expenses related to the valuation of certain assets as a result of the acquisition of Thryv Australia and foreign exchange-related expense. During the year ended December 31, 2022, Other primarily represents the bargain purchase gain as a result of the Vivial acquisition, partially offset by foreign exchange-related expense. |
The following tables set forth reconciliations of Adjusted Gross Profit and Adjusted Gross Margin, to their most directly comparable GAAP measures, Gross profit and Gross margin:
Three Months Ended December 31, 2023 |
|||||||||||||||||||
Thryv U.S. |
Thryv International |
||||||||||||||||||
(in thousands) |
Marketing Services |
SaaS |
Marketing Services |
SaaS |
Total |
||||||||||||||
Reconciliation of Adjusted Gross Profit |
|||||||||||||||||||
Gross profit |
$ |
88,520 |
$ |
47,183 |
$ |
21,232 |
$ |
2,775 |
$ |
159,710 |
|||||||||
Plus: |
|||||||||||||||||||
Depreciation and amortization expense |
2,665 |
1,425 |
1,356 |
150 |
5,596 |
||||||||||||||
Stock-based compensation expense |
74 |
43 |
— |
— |
117 |
||||||||||||||
Adjusted Gross Profit |
$ |
91,259 |
$ |
48,651 |
$ |
22,588 |
$ |
2,925 |
$ |
165,423 |
|||||||||
Gross Margin |
66.7 |
% |
66.8 |
% |
71.9 |
% |
83.6 |
% |
67.6 |
% |
|||||||||
Adjusted Gross Margin |
68.8 |
% |
68.9 |
% |
76.5 |
% |
88.2 |
% |
70.0 |
% |
|||||||||
Three Months Ended December 31, 2022 |
|||||||||||||||||||
Thryv U.S. |
Thryv International |
||||||||||||||||||
(in thousands) |
Marketing Services |
SaaS |
Marketing Services |
SaaS |
Total |
||||||||||||||
Reconciliation of Adjusted Gross Profit |
|||||||||||||||||||
Gross profit |
$ |
124,413 |
$ |
34,944 |
$ |
18,802 |
$ |
746 |
$ |
178,905 |
|||||||||
Plus: |
|||||||||||||||||||
Depreciation and amortization expense |
4,419 |
1,379 |
3,614 |
168 |
9,580 |
||||||||||||||
Stock-based compensation expense |
81 |
26 |
— |
— |
107 |
||||||||||||||
Adjusted Gross Profit |
$ |
128,913 |
$ |
36,349 |
$ |
22,416 |
$ |
914 |
$ |
188,592 |
|||||||||
Gross Margin |
66.3 |
% |
60.3 |
% |
58.2 |
% |
54.1 |
% |
64.0 |
% |
|||||||||
Adjusted Gross Margin |
68.7 |
% |
62.7 |
% |
69.4 |
% |
66.2 |
% |
67.5 |
% |
|||||||||
Year Ended December 31, 2023 |
|||||||||||||||||||
Thryv U.S. |
Thryv International |
||||||||||||||||||
(in thousands) |
Marketing Services |
SaaS |
Marketing Services |
SaaS |
Total |
||||||||||||||
Reconciliation of Adjusted Gross Profit |
|||||||||||||||||||
Gross profit |
$ |
320,327 |
$ |
161,663 |
$ |
88,730 |
$ |
7,527 |
$ |
578,247 |
|||||||||
Plus: |
|||||||||||||||||||
Depreciation and amortization expense |
10,766 |
5,429 |
10,045 |
749 |
26,989 |
||||||||||||||
Stock-based compensation expense |
399 |
214 |
— |
— |
613 |
||||||||||||||
Adjusted Gross Profit |
$ |
331,492 |
$ |
167,306 |
$ |
98,775 |
$ |
8,276 |
$ |
605,849 |
|||||||||
Gross Margin |
62.7 |
% |
63.8 |
% |
62.2 |
% |
74.2 |
% |
63.1 |
% |
|||||||||
Adjusted Gross Margin |
64.9 |
% |
66.0 |
% |
69.2 |
% |
81.6 |
% |
66.1 |
% |
|||||||||
Year Ended December 31, 2022 |
|||||||||||||||||||
Thryv U.S. |
Thryv International |
||||||||||||||||||
(in thousands) |
Marketing Services |
SaaS |
Marketing Services |
SaaS |
Total |
||||||||||||||
Reconciliation of Adjusted Gross Profit |
|||||||||||||||||||
Gross profit |
$ |
539,543 |
$ |
130,272 |
$ |
108,496 |
$ |
2,071 |
$ |
780,382 |
|||||||||
Plus: |
|||||||||||||||||||
Depreciation and amortization expense |
17,800 |
4,657 |
15,385 |
505 |
38,347 |
||||||||||||||
Stock-based compensation expense |
332 |
89 |
— |
— |
421 |
||||||||||||||
Adjusted Gross Profit |
$ |
557,675 |
$ |
135,018 |
$ |
123,881 |
$ |
2,576 |
$ |
819,150 |
|||||||||
Gross Margin |
65.8 |
% |
61.5 |
% |
65.4 |
% |
45.6 |
% |
64.9 |
% |
|||||||||
Adjusted Gross Margin |
68.0 |
% |
63.7 |
% |
74.6 |
% |
56.7 |
% |
68.1 |
% |
|||||||||
Supplemental Financial Information
The following supplemental financial information provides Revenue, Adjusted EBITDA and Adjusted EBITDA Margin by (i) Marketing Services businesses in the U.S., International and in Total and (ii) SaaS businesses in the U.S., International and in Total. Total SaaS Adjusted EBITDA and Adjusted EBITDA margin are non-GAAP financial measures. Total Marketing Services Adjusted EBITDA and Adjusted EBITDA margin are also non-GAAP financial measures. These non-GAAP financial measures are presented for supplemental informational purposes only and are not intended to be considered in isolation or as a substitute for, or superior to, financial information prepared and presented in accordance with GAAP. Please refer to the supplemental information presented in the tables below for a reconciliation of these non-GAAP financial measures to the corresponding segment financial measures presented in accordance with GAAP.
We believe that these non-GAAP financial measures provide useful information about our global SaaS and Marketing Services financial performance, enhance the overall understanding of our global SaaS and Marketing Services past financial performance and allow for greater transparency with respect to important metrics used by our management for financial and operational decision-making. We believe that these measures provide additional tools for investors to use in comparing our core financial performance over multiple periods.
Three Months Ended December 31, 2023 |
|||||||||||||||||||||||
(in thousands) |
Marketing Services |
SaaS |
|||||||||||||||||||||
U.S. |
International |
Total |
U.S. |
International |
Total |
||||||||||||||||||
Revenue |
$ |
132,665 |
$ |
29,528 |
$ |
162,193 |
$ |
70,652 |
$ |
3,318 |
$ |
73,970 |
|||||||||||
Adjusted EBITDA |
38,383 |
7,390 |
45,773 |
8,345 |
(1,842 |
) |
6,503 |
||||||||||||||||
Adjusted EBITDA Margin |
28.9 |
% |
25.0 |
% |
28.2 |
% |
11.8 |
% |
(55.5 |
)% |
8.8 |
% |
|||||||||||
Three Months Ended December 31, 2022 |
|||||||||||||||||||||||
(in thousands) |
Marketing Services |
SaaS |
|||||||||||||||||||||
U.S. |
International |
Total |
U.S. |
International |
Total |
||||||||||||||||||
Revenue |
$ |
187,755 |
$ |
32,295 |
$ |
220,050 |
$ |
57,938 |
$ |
1,380 |
$ |
59,318 |
|||||||||||
Adjusted EBITDA |
59,758 |
10,657 |
70,415 |
83 |
(2,305 |
) |
(2,222 |
) |
|||||||||||||||
Adjusted EBITDA Margin |
31.8 |
% |
33.0 |
% |
32.0 |
% |
0.1 |
% |
(167.0 |
)% |
(3.7 |
)% |
|||||||||||
Year Ended December 31, 2023 |
|||||||||||||||||||||||
(in thousands) |
Marketing Services |
SaaS |
|||||||||||||||||||||
U.S. |
International |
Total |
U.S. |
International |
Total |
||||||||||||||||||
Revenue |
$ |
510,533 |
$ |
142,711 |
$ |
653,244 |
$ |
253,579 |
$ |
10,138 |
$ |
263,717 |
|||||||||||
Adjusted EBITDA |
123,249 |
52,241 |
175,490 |
18,576 |
(6,551 |
) |
12,025 |
||||||||||||||||
Adjusted EBITDA Margin |
24.1 |
% |
36.6 |
% |
26.9 |
% |
7.3 |
% |
(64.6 |
)% |
4.6 |
% |
|||||||||||
Year Ended December 31, 2022 |
|||||||||||||||||||||||
(in thousands) |
Marketing Services |
SaaS |
|||||||||||||||||||||
U.S. |
International |
Total |
U.S. |
International |
Total |
||||||||||||||||||
Revenue |
$ |
820,032 |
$ |
166,010 |
$ |
986,042 |
$ |
211,801 |
$ |
4,545 |
$ |
216,346 |
|||||||||||
Adjusted EBITDA |
271,629 |
75,106 |
346,735 |
(3,686 |
) |
(9,707 |
) |
(13,393 |
) |
||||||||||||||
Adjusted EBITDA Margin |
33.1 |
% |
45.2 |
% |
35.2 |
% |
(1.7 |
)% |
(213.6 |
)% |
(6.2 |
)% |
|||||||||||
Forward-Looking Statements
Certain statements contained herein are not historical facts, constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and involve a number of risks and uncertainties. Statements that include the words “may”, “will”, “could”, “should”, “would”, “believe”, “anticipate”, “forecast”, “estimate”, “expect”, “preliminary”, “intend”, “plan”, “target”, “project”, “outlook”, “future”, “forward”, “guidance” and similar statements of a future or forward-looking nature identify forward-looking statements. These statements are not guarantees of future performance. These forward-looking statements are based on our current expectations and beliefs concerning future developments and their potential effect on us. While management believes that these forward-looking statements are reasonable as and when made, there can be no assurance that future developments affecting us will be those that we anticipate. Accordingly, there are or will be important factors that could cause our actual results to differ materially from those indicated in these statements. We believe that these factors include, but are not limited to, the risks related to the following: the Company’s ability to maintain adequate liquidity to fund operations; the Company’s future operating and financial performance; the Company’s ability to consummate acquisitions, or, if consummated, to successfully integrate acquired businesses into the Company’s operations, the Company’s ability to recognize the benefits of acquisitions, or the failure of an acquired company to achieve its plans and objectives; limitations on our operating and strategic flexibility and the ability to operate our business, finance our capital needs or expand business strategies under the terms of our credit facilities; our ability to retain existing business and obtain and retain new business; general economic or business conditions affecting the markets we serve; declining use of print yellow page directories by consumers; our ability to collect trade receivables from clients to whom we extend credit; credit risk associated with our reliance on small and medium sized businesses as clients; our ability to attract and retain key managers; increased competition in our markets; our ability to obtain future financing due to changes in the lending markets or our financial position; our ability to maintain agreements with major Internet search and local media companies; reduced advertising spending and increased contract cancellations by our clients, which causes reduced revenue; and our ability to anticipate or respond effectively to changes in technology and consumer preferences as well as the risks and uncertainties set forth in the Company's most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q filed with the Securities and Exchange Commission. All subsequent written and oral forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by such cautionary statements.
If one or more events related to these or other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, actual results may differ materially from what we anticipate. For these reasons, we caution you against relying on forward-looking statements. All forward-looking statements included in this press release are expressly qualified in their entirety by the foregoing cautionary statements. These forward-looking statements speak only as of the date hereof and, other than as required by law, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
About Thryv Holdings, Inc.
Thryv Holdings, Inc. (NASDAQ:THRY) is a global software and marketing services company that empowers small- to medium-sized businesses (SMBs) to grow and modernize their operations so they can compete and win in today’s economy. Over 65,000 businesses use our award-winning SaaS platform, Thryv®, to manage their end-to-end operations, which has helped these organizations across the U.S. and overseas grow their bottom line. Of Thryv’s approximately 350,000 business customers, most also use its digital and print presence products, connecting these SMBs to local consumers via proprietary local search portals and local directories. For more information about Thryv Holdings, Inc., visit thryv.com.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240222288650/en/
Media Contact: Julie Murphy Thryv, Inc. 617.967.5426 julie.murphy@thryv.com Investor Contact: Cameron Lessard Thryv, Inc. 214.773.7022 cameron.lessard@thryv.com
Source: Thryv