– Company exceeds all guidance metrics – Fourth quarter total SaaS clients increased 13% and SaaS monthly active users increased 37% year-over-year
DALLAS--(BUSINESS WIRE)-- Thryv Holdings, Inc. (NASDAQ:THRY) (“Thryv” or the “Company”), the provider of the leading small business software platform, Thryv®, announced that it grew its SaaS revenue 25% year-over-year in the fourth quarter of 2022.
“We delivered strong fourth quarter results, closing out a record year at Thryv,” said Joe Walsh, Thryv Chairman and CEO. “We exceeded all of our guidance metrics – reporting strong SaaS revenue growth, improving SaaS Adjusted EBITDA and increasing marketing services revenue. Our key SaaS metrics, subscribers and ARPU, grew double digits year-over-year as a result of our focus on innovation and execution. Our software platform is driving time to first value for clients. We hear from clients they want to reduce friction by consolidating their multiple point solutions and logins. With our all-in-one cloud based platform, SMBs have one login and one dashboard to gain greater business efficiency.”
“As we begin 2023, we are focused on our strategic initiatives - increasing engagement and usage - because these lead to increased renewal and spend," Walsh continued. "In support of our goal of driving engagement, we recently announced the move to a multiple-center platform. By offering multiple centers, we can solve additional problems small to medium businesses (SMBs) face.”
Marketing Center, Thryv's newest center, delivers the tools an SMB needs to market and grow their business. The solution offers improved online presence, a suite of marketing tools, search, social, display and connected TV advertising. In the future, additional centers will be launching enabling SMBs to address additional problems.
“I am confident that in 2023, we will sustain durable SaaS revenue growth and will continue to generate strong EBITDA margins from a consolidated standpoint,” said Paul Rouse, Chief Financial Officer. “Given the strength of our product offering, size of our customer base and revenue diversification, market demand has remained strong.”
Fourth Quarter 2022 Financial Highlights:
Revenue
- Total SaaS1 revenue was $59.3 million, a 24.9% increase year-over-year
- Total Marketing Services2 revenue was $220.1 million, an 11.7% increase year-over-year
- Consolidated total revenue was $279.4 million, an increase of 14.3% year-over-year
- Consolidated net loss was $50.4 million, or $(1.47) per diluted share, which includes a non-cash charge of $102.0 million, or $2.98 per diluted share, related to goodwill impairment; compared to net income of $5.1 million, or $0.13 per diluted share, for the fourth quarter of 2021
- Consolidated Adjusted EBITDA was $68.2 million, representing an Adjusted EBITDA margin of 24.4%
- Total SaaS Adjusted EBITDA loss was $2.2 million
- Total Marketing Services Adjusted EBITDA was $70.4 million, representing an Adjusted EBITDA margin of 32.0%
- Consolidated Gross Profit was $178.9 million, an increase of 18.2% year-over-year
- Consolidated Adjusted Gross Profit was $188.6 million
- SaaS Gross Profit was $35.7 million, representing a Gross Profit Margin of 60.2%
- SaaS Adjusted Gross Profit was $37.3 million, representing an Adjusted Gross Profit Margin of 62.8%
Full-Year 2022 Financial Highlights
- Total SaaS revenue was $216.3 million, a 26.5% increase year-over-year
- Total Marketing Services revenue was $986.0 million, an 4.6% increase year-over-year
- Consolidated total revenue was $1,202.4 million, an increase of 8.0% year-over-year
- Consolidated net income was $54.3 million, or $1.49 per diluted share, which includes a non-cash charge of $102.0 million related to goodwill impairment; compared to net income of $101.6 million, or $2.78 per diluted share, for the same period last year
- Consolidated Adjusted EBITDA was $333.3 million, representing an Adjusted EBITDA margin of 27.7%
- Total SaaS Adjusted EBITDA loss was $13.4 million
- Total Marketing Services Adjusted EBITDA was $346.7 million, representing an Adjusted EBITDA margin of 35.2%
- Consolidated Gross Profit was $780.4 million, an increase of 11% year-over-year
- Consolidated Adjusted Gross Profit was $819.2 million
- SaaS Gross Profit was $132.3 million, representing a Gross Profit Margin of 61.2%
- SaaS Adjusted Gross Profit was $137.6 million, representing an Adjusted Gross Profit Margin of 63.6%
SaaS Metrics
- SaaS monthly Average Revenue per Unit (“ARPU”)3 increased to $387 for the fourth quarter of 2022, compared to $351 in the fourth quarter of 2021
- Total SaaS clients increased 13% year-over-year to 52 thousand for the fourth quarter of 2022
- Seasoned Net Dollar Retention4 was 91% at the end of the fourth quarter of 2022
- SaaS monthly active users5 increased 37% year-over-year to 41 thousand active users for the fourth quarter of 2022
- ThryvPay total payment volume increased 114% year-over-year
Outlook
Based on information available as of February 23, 2023, Thryv is issuing guidance6 for the full year 2023 as indicated below:
1st Quarter |
Full Year |
||||
(in millions) |
2023 |
2023 |
|||
SaaS Revenue |
$59.5 - $60.0 |
$257 to $259 |
|||
SaaS Adjusted EBITDA |
($2.0 - $3.0) |
Turns Profitable |
1st Quarter |
2nd Quarter |
3rd Quarter |
4th Quarter |
Full Year |
|||||
(in millions) |
2023 |
2023 |
2023 |
2023 |
2023 |
||||
Marketing Services Revenue |
$176 - $180 |
$182 - $186 |
$112 - $115 |
$165 - $168 |
$635 - $649 |
||||
Marketing Services Adjusted EBITDA |
$185 - $187 |
____________________________ 1 Total SaaS revenue in the U.S. and International segments was $57.9 million and $1.4 million for the three months ended December 31, 2022, respectively. 2 Total Marketing Services revenue in the U.S. and International segments was $187.8 million and $32.3 million for the three months ended December 31, 2022, respectively. 3 Defined as total client billings by month divided by the number of clients that have revenue-generating solutions during the month. 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 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.
Earnings Conference Call Information
Thryv will host a conference call on Thursday, February 23, 2023 at 8:30 a.m. (Eastern Time) to discuss the Company's fourth quarter 2022 results.
For analysts to register for this conference call, please use this link. To listen to the webcast, please use this link or visit Thryv's Investor Relations website at investor.thryv.com. 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. 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 “87769.”
Final Results
Thryv Holdings, Inc. and Subsidiaries Consolidated Statements of Operations and Comprehensive Income (Loss) |
|||||||||||||||
Three Months Ended |
Years Ended |
||||||||||||||
December 31, |
December 31, |
||||||||||||||
(in thousands, except share and per share data) |
2022 |
2021 |
2022 |
2021 |
|||||||||||
Revenue |
$ |
279,368 |
$ |
244,439 |
$ |
1,202,388 |
$ |
1,113,382 |
|||||||
Cost of services |
100,463 |
93,109 |
422,006 |
408,043 |
|||||||||||
Gross profit |
178,905 |
151,330 |
780,382 |
705,339 |
|||||||||||
Operating expenses: |
|||||||||||||||
Sales and marketing |
86,773 |
99,536 |
362,432 |
357,813 |
|||||||||||
General and administrative |
56,892 |
46,540 |
216,406 |
153,902 |
|||||||||||
Impairment charges |
102,000 |
— |
102,222 |
3,611 |
|||||||||||
Total operating expenses |
245,665 |
146,076 |
681,060 |
515,326 |
|||||||||||
Operating (loss) income |
(66,760 |
) |
5,254 |
99,322 |
190,013 |
||||||||||
Other income (expense): |
|||||||||||||||
Interest expense |
(16,318 |
) |
(10,708 |
) |
(56,902 |
) |
(48,867 |
) |
|||||||
Interest expense, related party |
— |
(4,278 |
) |
(3,505 |
) |
(17,507 |
) |
||||||||
Other components of net periodic pension benefit |
39,317 |
13,831 |
44,612 |
14,829 |
|||||||||||
Other income (expense) |
(119 |
) |
3 |
15,448 |
(4,154 |
) |
|||||||||
(Loss) income before income tax (expense) benefit |
(43,880 |
) |
4,102 |
98,975 |
134,314 |
||||||||||
Income tax (expense) benefit |
(6,565 |
) |
986 |
(44,627 |
) |
(32,737 |
) |
||||||||
Net (loss) income |
$ |
(50,445 |
) |
$ |
5,088 |
$ |
54,348 |
$ |
101,577 |
||||||
Other comprehensive income (loss): |
|||||||||||||||
Foreign currency translation adjustment, net of tax |
4,397 |
498 |
(8,214 |
) |
(8,047 |
) |
|||||||||
Comprehensive (loss) income |
$ |
(46,048 |
) |
$ |
5,586 |
$ |
46,134 |
$ |
93,530 |
||||||
Net (loss) income per common share: |
|||||||||||||||
Basic |
$ |
(1.47 |
) |
$ |
0.15 |
$ |
1.58 |
$ |
3.02 |
||||||
Diluted |
$ |
(1.47 |
) |
$ |
0.13 |
$ |
1.49 |
$ |
2.78 |
||||||
Weighted-average shares used in computing basic and diluted net (loss) income per common share: |
|||||||||||||||
Basic |
34,270,520 |
34,006,358 |
34,336,493 |
33,607,446 |
|||||||||||
Diluted |
34,270,520 |
37,983,847 |
36,506,095 |
36,495,746 |
|||||||||||
Thryv Holdings, Inc. and Subsidiaries Consolidated Balance Sheets |
|||||||
(in thousands, except share data) |
December 31, 2022 |
December 31, 2021 |
|||||
Assets |
|||||||
Current assets |
|||||||
Cash and cash equivalents |
$ |
16,031 |
$ |
11,262 |
|||
Accounts receivable, net of allowance of $14,766 in 2022 and $17,387 in 2021 |
284,698 |
279,053 |
|||||
Contract assets, net of allowance of $33 in 2022 and $88 in 2021 |
2,583 |
5,259 |
|||||
Taxes receivable |
11,553 |
14,711 |
|||||
Prepaid expenses |
25,092 |
22,418 |
|||||
Indemnification asset |
26,495 |
24,346 |
|||||
Other current assets |
11,864 |
13,596 |
|||||
Total current assets |
378,316 |
370,645 |
|||||
Fixed assets and capitalized software, net |
42,334 |
50,938 |
|||||
Goodwill |
566,004 |
671,886 |
|||||
Intangible assets, net |
34,715 |
82,577 |
|||||
Deferred tax assets |
113,859 |
90,565 |
|||||
Other assets |
42,649 |
33,891 |
|||||
Total assets |
$ |
1,177,877 |
$ |
1,300,502 |
|||
Liabilities and Stockholders' Equity |
|||||||
Current liabilities |
|||||||
Accounts payable |
$ |
18,972 |
$ |
8,610 |
|||
Accrued liabilities |
126,810 |
131,813 |
|||||
Current portion of unrecognized tax benefits |
31,919 |
29,771 |
|||||
Contract liabilities |
41,854 |
51,726 |
|||||
Current portion of long-term debt |
70,000 |
70,000 |
|||||
Other current liabilities |
10,937 |
15,214 |
|||||
Total current liabilities |
300,492 |
307,134 |
|||||
Term Loan, net |
345,256 |
309,672 |
|||||
Term Loan, related party |
— |
142,875 |
|||||
ABL Facility |
54,554 |
39,929 |
|||||
Pension obligations, net |
72,590 |
140,167 |
|||||
Deferred tax liabilities |
513 |
10,798 |
|||||
Other liabilities |
22,205 |
35,212 |
|||||
Total long-term liabilities |
495,118 |
678,653 |
|||||
Commitments and contingencies |
|||||||
Stockholders' equity |
|||||||
Common stock - $0.01 par value, 250,000,000 shares authorized; 61,279,379 shares issued and 34,593,837 shares outstanding at December 31, 2022; and 60,830,853 shares issued and 34,145,311 shares outstanding at December 31, 2021 |
613 |
608 |
|||||
Additional paid-in capital |
1,105,701 |
1,084,288 |
|||||
Treasury stock - 26,685,542 shares at December 31, 2022 and December 31, 2021 |
(468,879 |
) |
(468,879 |
) |
|||
Accumulated other comprehensive income (loss) |
(16,261 |
) |
(8,047 |
) |
|||
Accumulated deficit |
(238,907 |
) |
(293,255 |
) |
|||
Total stockholders' equity |
382,267 |
314,715 |
|||||
Total liabilities and stockholders' equity |
$ |
1,177,877 |
$ |
1,300,502 |
|||
Thryv Holdings, Inc. and Subsidiaries Consolidated Statements of Cash Flows |
|||||||
Years Ended December 31, |
|||||||
(in thousands) |
2022 |
2021 |
|||||
Cash Flows from Operating Activities |
|||||||
Net income |
$ |
54,348 |
$ |
101,577 |
|||
Adjustments to reconcile net income to net cash provided by operating activities: |
|||||||
Depreciation and amortization |
88,392 |
105,473 |
|||||
Amortization of debt issuance costs |
5,749 |
4,919 |
|||||
Deferred income taxes |
(15,119 |
) |
(20,438 |
) |
|||
Provision for credit losses and service credits |
25,971 |
19,394 |
|||||
Stock-based compensation expense |
14,628 |
8,094 |
|||||
Other components of net periodic pension (benefit) |
(44,612 |
) |
(14,829 |
) |
|||
Impairment charges |
102,222 |
3,611 |
|||||
(Gain) loss on foreign currency exchange rates |
(1,591 |
) |
745 |
||||
Bargain purchase gain |
(10,883 |
) |
— |
||||
Other |
(2,866 |
) |
(2,569 |
) |
|||
Changes in working capital items, excluding acquisitions: |
|||||||
Accounts receivable |
(5,242 |
) |
74,368 |
||||
Contract assets |
2,764 |
5,628 |
|||||
Prepaid expenses and other assets |
2,518 |
6,084 |
|||||
Accounts payable and accrued liabilities |
(41,105 |
) |
(125,883 |
) |
|||
Other liabilities |
(26,601 |
) |
4,397 |
||||
Net cash provided by operating activities |
148,573 |
170,571 |
|||||
Cash Flows from Investing Activities |
|||||||
Additions to fixed assets and capitalized software |
(29,233 |
) |
(26,849 |
) |
|||
Proceeds from the sale of fixed assets |
— |
6,836 |
|||||
Acquisition of a business, net of cash acquired |
(22,793 |
) |
(175,370 |
) |
|||
Other |
— |
(1,192 |
) |
||||
Net cash (used in) investing activities |
(52,026 |
) |
(196,575 |
) |
|||
Cash Flows from Financing Activities |
|||||||
Proceeds from Term Loan |
— |
418,070 |
|||||
Proceeds from Term Loan, related party |
— |
260,930 |
|||||
Payments of Term Loan |
(104,165 |
) |
(110,215 |
) |
|||
Payments of Term Loan, related party |
(8,347 |
) |
(47,785 |
) |
|||
Payments of Senior Term Loan |
— |
(335,821 |
) |
||||
Payments of Senior Term Loan, related party |
— |
(113,789 |
) |
||||
Proceeds from ABL Facility |
976,296 |
1,046,249 |
|||||
Payments of ABL Facility |
(961,670 |
) |
(1,085,558 |
) |
|||
Proceeds from exercises of stock options and stock warrants |
6,789 |
20,967 |
|||||
Other |
— |
(13,960 |
) |
||||
Net cash (used in) provided by financing activities |
(91,097 |
) |
39,088 |
||||
Effect of exchange rate changes on cash and cash equivalents |
(827 |
) |
(1,933 |
) |
|||
Increase in cash and cash equivalents and restricted cash |
4,623 |
11,151 |
|||||
Cash and cash equivalents and restricted cash, beginning of period |
13,557 |
2,406 |
|||||
Cash and cash equivalents and restricted cash, end of period |
$ |
18,180 |
$ |
13,557 |
|||
Supplemental Information |
|||||||
Cash paid for interest |
$ |
57,084 |
$ |
66,737 |
|||
Cash paid for income taxes, net |
$ |
58,259 |
$ |
63,893 |
|||
The following tables summarize the operating results of the Company's reportable segments:
Three Months Ended December 31, |
Change |
|||||||||||||
(in thousands of $) |
2022 |
2021 |
Amount |
% |
||||||||||
Revenue |
||||||||||||||
Thryv U.S. (1) |
||||||||||||||
Marketing Services |
$ |
187,755 |
$ |
153,555 |
$ |
34,200 |
22.3 |
% |
||||||
SaaS |
57,938 |
47,061 |
10,877 |
23.1 |
% |
|||||||||
Thryv International (2) |
||||||||||||||
Marketing Services |
32,295 |
43,409 |
(11,114 |
) |
(25.6 |
)% |
||||||||
SaaS |
1,380 |
414 |
966 |
NM |
||||||||||
Consolidated Revenue |
$ |
279,368 |
$ |
244,439 |
$ |
34,929 |
14.3 |
% |
||||||
Segment Gross Profit |
||||||||||||||
Thryv U.S. (1) |
||||||||||||||
Marketing Services |
$ |
124,413 |
$ |
97,622 |
$ |
26,791 |
27.4 |
% |
||||||
SaaS |
34,944 |
28,710 |
6,234 |
21.7 |
% |
|||||||||
Thryv International (2) |
||||||||||||||
Marketing Services |
18,802 |
25,006 |
(6,204 |
) |
(24.8 |
)% |
||||||||
SaaS |
746 |
(8 |
) |
754 |
NM |
|||||||||
Consolidated Segment Gross Profit |
$ |
178,905 |
$ |
151,330 |
$ |
27,575 |
18.2 |
% |
||||||
Segment EBITDA |
||||||||||||||
Thryv U.S. (1) |
||||||||||||||
Marketing Services |
$ |
59,758 |
$ |
40,684 |
$ |
19,074 |
46.9 |
% |
||||||
SaaS |
83 |
(6,693 |
) |
6,776 |
101.2 |
% |
||||||||
Thryv International (2) |
||||||||||||||
Marketing Services |
10,657 |
16,968 |
(6,311 |
) |
(37.2 |
)% |
||||||||
SaaS |
(2,305 |
) |
(4,481 |
) |
2,176 |
(48.6 |
)% |
|||||||
Consolidated Adjusted EBITDA |
$ |
68,193 |
$ |
46,478 |
$ |
21,715 |
46.7 |
% |
||||||
(1) |
Thryv U.S. includes Vivial results of operations subsequent to the January 21, 2022 acquisition date. |
|
(2) |
Thryv International includes Thryv Australia results of operations subsequent to the March 1, 2021 acquisition date. |
Years Ended December 31, |
Change |
|||||||||||||
(in thousands of $) |
2022 |
2021 |
Amount |
% |
||||||||||
Revenue |
||||||||||||||
Thryv U.S. (1) |
||||||||||||||
Marketing Services |
$ |
820,032 |
$ |
797,493 |
$ |
22,539 |
2.8 |
% |
||||||
SaaS |
211,801 |
170,498 |
41,303 |
24.2 |
% |
|||||||||
Thryv International (2) |
||||||||||||||
Marketing Services |
166,010 |
144,837 |
21,173 |
14.6 |
% |
|||||||||
SaaS |
4,545 |
554 |
3,991 |
NM |
||||||||||
Consolidated Revenue |
$ |
1,202,388 |
$ |
1,113,382 |
$ |
89,006 |
8.0 |
% |
||||||
Segment Gross Profit |
||||||||||||||
Thryv U.S. (1) |
||||||||||||||
Marketing Services |
$ |
539,543 |
$ |
539,866 |
$ |
(323 |
) |
(0.1 |
)% |
|||||
SaaS |
130,272 |
104,944 |
25,328 |
24.1 |
% |
|||||||||
Thryv International (2) |
||||||||||||||
Marketing Services |
108,496 |
60,761 |
47,735 |
78.6 |
% |
|||||||||
SaaS |
2,071 |
(232 |
) |
2,303 |
NM |
|||||||||
Consolidated Segment Gross Profit |
$ |
780,382 |
$ |
705,339 |
$ |
75,043 |
10.6 |
% |
||||||
Segment EBITDA |
||||||||||||||
Thryv U.S. (1) |
||||||||||||||
Marketing Services |
$ |
271,629 |
$ |
318,230 |
$ |
(46,601 |
) |
(14.6 |
)% |
|||||
SaaS |
(3,686 |
) |
(14,004 |
) |
10,318 |
73.7 |
% |
|||||||
Thryv International (2) |
||||||||||||||
Marketing Services |
75,106 |
53,150 |
21,956 |
41.3 |
% |
|||||||||
SaaS |
(9,707 |
) |
(6,853 |
) |
(2,854 |
) |
41.6 |
% |
||||||
Consolidated Adjusted EBITDA |
$ |
333,342 |
$ |
350,523 |
$ |
(17,181 |
) |
(4.9 |
)% |
|||||
(1) |
Thryv U.S. includes Vivial results subsequent to the January 21, 2022 acquisition date. |
|
(2) |
Thryv International includes Thryv Australia results subsequent to the March 1, 2021 acquisition date. |
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 income and Adjusted Gross Profit to Gross profit. Both Net 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 income:
Three Months Ended December 31, |
Years Ended December 31, |
||||||||||||||
(in thousands) |
2022 |
2021 |
2022 |
2021 |
|||||||||||
Reconciliation of Adjusted EBITDA |
|||||||||||||||
Net (loss) income |
$ |
(50,445 |
) |
$ |
5,088 |
$ |
54,348 |
$ |
101,577 |
||||||
Impairment charges |
102,000 |
— |
102,222 |
3,611 |
|||||||||||
Depreciation and amortization expense |
22,438 |
24,798 |
88,392 |
105,473 |
|||||||||||
Interest expense |
16,318 |
14,986 |
60,407 |
66,374 |
|||||||||||
Income tax expense (benefit) |
6,565 |
(986 |
) |
44,627 |
32,737 |
||||||||||
Restructuring and integration expenses (1) |
3,365 |
3,109 |
17,804 |
18,145 |
|||||||||||
Stock-based compensation expense (2) |
4,488 |
1,862 |
14,628 |
8,094 |
|||||||||||
Transaction costs (3) |
1,322 |
5,086 |
6,119 |
25,059 |
|||||||||||
Other components of net periodic pension (benefit) (4) |
(39,317 |
) |
(13,831 |
) |
(44,612 |
) |
(14,829 |
) |
|||||||
Non-cash (gain) loss from remeasurement of indemnification asset (5) |
(676 |
) |
1,247 |
(2,148 |
) |
(1 |
) |
||||||||
Other (6) |
2,135 |
5,119 |
(8,445 |
) |
4,283 |
||||||||||
Adjusted EBITDA |
$ |
68,193 |
$ |
46,478 |
$ |
333,342 |
$ |
350,523 |
|||||||
| (1) | For the years ended December 31, 2022 and 2021, expenses relate to periodic efforts to enhance efficiencies and reduce costs, and include severance benefits, loss on disposal of fixed assets and capitalized software, and costs associated with abandoned facilities and system consolidation. |
|
| (2) | We record stock-based compensation expense related to the amortization of grant date fair value of the Company’s stock-based compensation awards. |
|
| (3) | Expenses related to the Thryv Australia and Vivial acquisitions and other transaction costs. |
|
| (4) | 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 the mark-to-market pension remeasurement. |
|
| (5) | 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. |
|
| (6) | 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. During the years ended December 31, 2021 and 2020, Other primarily includes expenses related to potential non-income based tax liabilities and 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, 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 |
% |
|||||||||
Three Months Ended December 31, 2021 |
|||||||||||||||||||
Thryv U.S. |
Thryv International |
||||||||||||||||||
(in thousands) |
Marketing Services |
SaaS |
Marketing Services |
SaaS |
Total |
||||||||||||||
Reconciliation of Adjusted Gross Profit |
|||||||||||||||||||
Gross profit |
$ |
97,622 |
$ |
28,710 |
$ |
25,006 |
$ |
(8 |
) |
$ |
151,330 |
||||||||
Plus: |
|||||||||||||||||||
Depreciation and amortization expense |
3,493 |
1,102 |
5,594 |
53 |
10,242 |
||||||||||||||
Stock-based compensation expense |
44 |
16 |
— |
— |
60 |
||||||||||||||
Adjusted Gross Profit |
$ |
101,159 |
$ |
29,828 |
$ |
30,600 |
$ |
45 |
$ |
161,632 |
|||||||||
Gross Margin |
63.6 |
% |
61.0 |
% |
57.6 |
% |
(1.9 |
)% |
61.9 |
% |
|||||||||
Adjusted Gross Margin |
65.9 |
% |
63.4 |
% |
70.5 |
% |
10.9 |
% |
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 |
% |
|||||||||
Year Ended December 31, 2021 |
|||||||||||||||||||
Thryv U.S. |
Thryv International |
||||||||||||||||||
(in thousands) |
Marketing Services |
SaaS |
Marketing Services |
SaaS |
Total |
||||||||||||||
Reconciliation of Adjusted Gross Profit |
|||||||||||||||||||
Gross profit |
$ |
539,866 |
$ |
104,944 |
$ |
60,761 |
$ |
(232 |
) |
$ |
705,339 |
||||||||
Plus: |
|||||||||||||||||||
Depreciation and amortization expense |
16,978 |
3,700 |
32,463 |
92 |
53,233 |
||||||||||||||
Stock-based compensation expense |
309 |
71 |
— |
— |
380 |
||||||||||||||
Adjusted Gross Profit |
$ |
557,153 |
$ |
108,715 |
$ |
93,224 |
$ |
(140 |
) |
$ |
758,952 |
||||||||
Gross Margin |
67.7 |
% |
61.6 |
% |
42.0 |
% |
(41.9 |
)% |
63.4 |
% |
|||||||||
Adjusted Gross Margin |
69.9 |
% |
63.8 |
% |
64.4 |
% |
(25.3 |
)% |
68.2 |
% |
|||||||||
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, 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 |
)% |
|||||||||||
Three Months Ended December 31, 2021 |
|||||||||||||||||||||||
(in thousands) |
Marketing Services |
SaaS |
|||||||||||||||||||||
U.S. |
International |
Total |
U.S. |
International |
Total |
||||||||||||||||||
Revenue |
$ |
153,555 |
$ |
43,409 |
$ |
196,964 |
$ |
47,061 |
$ |
414 |
$ |
47,475 |
|||||||||||
Adjusted EBITDA |
40,684 |
16,968 |
57,652 |
(6,693 |
) |
(4,481 |
) |
(11,174 |
) |
||||||||||||||
Adjusted EBITDA Margin |
26.5 |
% |
39.1 |
% |
29.3 |
% |
(14.2 |
)% |
NM |
(23.5 |
)% |
||||||||||||
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 |
)% |
|||||||||||
Year Ended December 31, 2021 |
|||||||||||||||||||||||
(in thousands) |
Marketing Services |
SaaS |
|||||||||||||||||||||
U.S. |
International |
Total |
U.S. |
International |
Total |
||||||||||||||||||
Revenue |
$ |
797,493 |
$ |
144,837 |
$ |
942,330 |
$ |
170,498 |
$ |
554 |
$ |
171,052 |
|||||||||||
Adjusted EBITDA |
318,230 |
53,150 |
371,380 |
(14,004 |
) |
(6,853 |
) |
(20,857 |
) |
||||||||||||||
Adjusted EBITDA Margin |
39.9 |
% |
36.7 |
% |
39.4 |
% |
(8.2 |
)% |
NM |
(12.2 |
)% |
||||||||||||
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: risks related to the ongoing COVID-19 pandemic, 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 From 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 50,000 businesses use our award-winning SaaS platform, Thryv®, to manage their end-to-end operations, which has helped businesses across the U.S. and overseas grow their bottom line. Thryv also manages digital and print presence for approximately 390,000 businesses, connecting these SMBs to local consumers via proprietary local search portals and print directories. For more information about Thryv Holdings, Inc, visit thryv.com.
View source version on businesswire.com: https://www.businesswire.com/news/home/20230223005351/en/
Media Contact: Paige Blankenship Thryv, Inc. 214-392-9609 paige.blankenship@thryv.com
Investor Contact: Cameron Lessard Thryv, Inc. 214.773.7022 cameron.lessard@thryv.com
Source: Thryv