8-K
ILCAfalse0001818201 0001818201 2021-08-12 2021-08-12 0001818201 dei:FormerAddressMember 2021-08-12 2021-08-12 0001818201 us-gaap:CommonStockMember 2021-08-12 2021-08-12 0001818201 us-gaap:WarrantMember 2021-08-12 2021-08-12
 
 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
 
FORM 8-K
 
 
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported):
August 12, 2021
 
 
CCC INTELLIGENT SOLUTIONS HOLDINGS INC.
(Exact name of registrant as specified in its charter)
 
 
 
Delaware
 
001-39447
 
98-1546280
(State or other jurisdiction
of incorporation)
 
(Commission
File Number)
 
(IRS Employer
Identification No.)
222 Merchandise Mart Plaza
 
Suite 900
Chicago, IL 60654
(Address of principal executive offices, including zip code)
Registrant’s telephone number, including area code: (800) 621-8070
Dragoneer Growth Opportunities Corp.
One Letterman Drive
Building D, Suite M500
San Francisco, CA 94129
(Former name or former address, if changed since last report)
 
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
 
Title of each class
 
Trading
Symbol(s)
 
Name of each exchange
on which registered
Common stock, par value $0.0001 per share
 
CCCS
 
The New York Stock Exchange
Warrants to purchase one share of common stock at an exercise price of $11.50
 
CCCS WS
 
The New York Stock Exchange
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
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 Operations and Financial Condition.
On August 12, 2021, CCC Intelligent Solutions Holdings Inc. issued a press release announcing financial results for the quarter ended June 30, 2021. A copy of the press release is being furnished as Exhibit 99.1 to this Current Report on Form
8-K.
The information contained in this Current Report on Form
8-K
and Exhibit 99.1 attached hereto is intended to be furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such filing.
 
Item 9.01.
Financial Statements and Exhibits.
(d) Exhibits.
 
Exhibit
Number
  
Description
99.1    Press release, dated August 12, 2021.
104    Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURES
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.
 
CCC Intelligent Solutions Holdings Inc.
By:  
/s/ Brian Herb
Name:   Brian Herb
Title:   Executive Vice President, Chief Financial and Administrative Officer
Date: August 12, 2021
EX-99.1

Exhibit 99.1

CCC Intelligent Solutions Inc. Announces Second Quarter Fiscal 2021 Financial Results

August 12, 2021 — CCC Intelligent Solutions Inc. (CCC) (NYSE: CCCS), a leading SaaS platform for the Property & Casualty insurance economy, today announced its financial results for the three months ended June 30, 2021.

“We saw continued adoption of digital and AI solutions that accelerated top-line performance in the second quarter. Our continuous focus on innovation and customer success has CCC in a terrific position to support the digitization of the P&C insurance economy by delivering the differentiated solutions our customers want to improve their business,” said Githesh Ramamurthy, Chairman & CEO of CCC.

Ramamurthy continued, “We are excited by the successful completion of our business combination with Dragoneer Growth Opportunity Corp. and our return to the public markets. We have increased flexibility to expand how we invest in the business that will benefit our customers and provide additional growth opportunities for CCC to meet or exceed our long-term growth objectives.”

Second Quarter 2021 Financial Highlights

Revenue

 

   

Total revenue was $166.8 million for the second quarter of 2021, compared to $150.7 million for the second quarter of 2020. Adjusted for the impact of the divestiture of a portion of our professional services casualty solution in December 2020, total revenue grew 16% in the second quarter of 2021.

Profitability

 

   

GAAP gross profit was $121.3 million, representing a gross margin of 73%, for the second quarter of 2021, compared with GAAP gross profit of $100.7 million, representing a gross margin of 67%, for the second quarter of 2020. Adjusted gross profit was $128.0 million, representing an adjusted gross margin of 77%, for the second quarter of 2021, compared with adjusted gross profit of $107.3 million, representing an adjusted gross margin of 74%, for the second quarter of 2020

 

   

GAAP operating income was $22.0 million for the second quarter of 2021, compared with GAAP operating income of $15.6 million for the second quarter of 2020. Adjusted operating income was $54.8 million for the second quarter of 2021, compared with adjusted operating income of $42.5 million for the second quarter of 2020.

 

   

GAAP net income was $3.8 million for the second quarter of 2021, compared with GAAP net loss of $2.0 million for the second quarter of 2020. Adjusted net income was $26.3 million for the second quarter of 2021, compared with adjusted net income of $17.5 million for the second quarter of 2020.

 

   

Adjusted EBITDA was $60.1 million for the second quarter of 2021, compared with adjusted EBITDA of $46.9 million for the second quarter of 2020. Adjusted EBITDA grew 28% in the second quarter of 2021 as compared to the second quarter of 2020.

Liquidity

 

   

CCC had $58.5 million in cash and cash equivalents and $1.3 billion of total debt at June 30, 2021. The Company generated $21.6 million in cash from operating activities and had free cash flow of $13.1 million during the second quarter of 2021, compared with $14.7 million generated in cash from operating activities and had $7.6 million in free cash flow in the second quarter of 2020.

The information presented above includes non-GAAP financial measures such as “adjusted EBITDA,” “adjusted net income,” “adjusted operating income,” “adjusted gross margin,” and “free cash flow.” Refer to “Non-GAAP Financial Measures” for a discussion of these measures and reconciliations of each non-GAAP financial measure to the most directly comparable GAAP financial measure.


2nd Quarter and Recent Business Highlights

 

   

Successfully completed our business combination with Dragoneer Growth Opportunities Corp and began trading under the ticker “CCCS” on the New York Stock Exchange on August 2, 2021. CCC received net proceeds from this transaction of more than $600 million.

 

   

Announced CCC ONE® Estimating-IQ, which will enhance the AI capabilities on the CCC ONE® platform for repair facilities, will be released in the third quarter. Incorporation of advanced AI will accelerate estimating for the tens of thousands of collision repairers using the CCC ONE platform.

 

   

Announced a partnership with Buckle, an inclusive tech-enabled financial services company, to digitize auto claims for its community of rideshare and delivery drivers. This win reinforces the opportunity we see to expand our solutions to emerging parts of the auto economy ecosystem.

 

   

Announced the new corporate name CCC Intelligent Solutions Inc. The new name reflects the company’s focus on applying AI, IoT, and advanced analytics to power mission-critical workflows, commerce, and connections across the multi-trillion dollar insurance economy. The CCC Cloud platform connects insurers, collision repairers, automakers, lenders, suppliers, and more to support the industry’s digital transformation.

Business Outlook

Based on information as of today, August 12, 2021, the Company is issuing the following financial guidance:

 

     Third Quarter Fiscal 2021      Full Year Fiscal 2021  

Revenue

   $ 172.5 million to $174.5 million      $ 677 million to $682 million  

Adjusted EBITDA

   $ 61 million to $63 million      $ 244 million to $249 million  

Year-over-year revenue growth for the third quarter of 2021 is forecasted to be 9%—10%, or 15%—16% when adjusted for the impact of the divestiture of a portion of our casualty solution (specifically, First Party Clinical Services) in December 2020. Year-over-year revenue growth for the full year 2021 is forecasted to be 7%—8%, or 13%—14% on an adjusted basis. First Party Clinical Services revenue was $7.8 million and $34.7 million for our fiscal third quarter and year end 2020, respectively.

Conference Call Information

CCC will host a conference call today, August 12, 2021, at 5:00 p.m. (Eastern Time) to discuss the Company’s financial results and financial guidance. To access this call, dial 844-200-6205 (domestic) or 44-208-0682-558 (international). The conference ID number is 941788. A live webcast of this conference call will be available on the “Investor Relations” page (https://ir.cccis.com/home/default.aspx.) and a replay will be archived on the website as well.

About CCC Intelligent Solutions

CCC Intelligent Solutions Inc. (CCC) (NYSE: CCCS) is a leading SaaS platform for the multi-trillion-dollar P&C insurance economy powering operations for insurers, repairers, automakers, part suppliers, lenders, and more. CCC cloud technology connects more than 30,000 businesses digitizing mission-critical workflows, commerce, and customer experiences. A trusted leader in AI, IoT, customer experience, network and workflow management, CCC delivers innovations that keep people’s lives moving forward when it matters most. Learn more about CCC at www.cccis.com.

Forward Looking Statements

This press release contains forward-looking statements that are based on beliefs and assumptions and on information currently available. In some cases, you can identify forward-looking statements by the following words: “may,” “will,” “could,” “would,” “should,” “expect,” “intend,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “project,” “potential,” “continue,” “ongoing” or


the negative of these terms or other comparable terminology, although not all forward-looking statements contain these words. These statements involve risks, uncertainties and other factors that may cause actual results, levels of activity, performance or achievements to be materially different from the information expressed or implied by these forward-looking statements. Forward-looking statements in this press release include, but are not limited to, statements regarding future events, goals, plans and projections regarding the company’s financial position, results of operations, market position, product development and business strategy. Such differences may be material. We cannot assure you that the forward-looking statements in this press release will prove to be accurate. These forward looking statements are subject to a number of risks and uncertainties, including, among others, the general economic, political, business and competitive conditions; the ability to recognize the anticipated benefits of the business combination (the “business combination”) of CCC’s parent corporation and Dragoneer Growth Opportunities Corp. ; the impact of COVID-19 on CCC’s business and/or the ability of the parties to complete the business combination; failure to realize the anticipated benefits of the business combination, ; costs related to the business combination; the ability of the Company to grow and manage growth profitably and retain its key employees; the risk that the expansion of CCC Payments and launch of CCC Estimate are not as successful as anticipated or do not occur on the expected timing; the inability to maintain CCC’s listing of securities on the NYSE; changes in applicable laws or regulations; and other risks and uncertainties, including those included under the header “Risk Factors” in the definitive proxy statement/prospectus filed by Dragoneer Growth Opportunities Corp. with the Securities and Exchange Commission (“SEC”) on July 6, 2021, which can be obtained, without charge, at the SEC’s website (www.sec.gov). The forward-looking statements in this press release represent our views as of the date of this press release. We anticipate that subsequent events and developments will cause our views to change. However, while we may elect to update these forward-looking statements at some point in the future, we have no current intention of doing so except to the extent required by applicable law. You should, therefore, not rely on these forward-looking statements as representing our views as of any date subsequent to the date of this press release.

Non-GAAP Financial Measures

This press release includes certain financial measures not presented in accordance with generally accepted accounting principles in the U.S. (“GAAP”), including, but not limited to, “adjusted EBITDA,” “adjusted net income,” “adjusted operating income,” “adjusted gross margin,” and “free cash flow” in each case presented on a non-GAAP basis, and certain ratios and other metrics derived therefrom. These non-GAAP financial measures are not measures of financial performance in accordance with GAAP and may exclude items that are significant in understanding and assessing the Company’s financial results. Therefore, these measures should not be considered in isolation or as an alternative to other measures of profitability, liquidity or performance under GAAP. You should be aware that the Company’s calculation of these non-GAAP measures may not be comparable to similarly-titled measures used by other companies.

The Company believes these non-GAAP measures of financial results provide useful information to management and investors regarding certain financial and business trends relating to the Company’s financial condition and results of operations. The Company believes that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends in and in comparing the Company’s financial measures with other similar companies, many of which present similar non-GAAP financial measures to investors. These non-GAAP financial measures are subject to inherent limitations as they reflect the exercise of judgments by management about which expense and income are excluded or included in determining these non-GAAP financial measures, Please refer to the reconciliations of these measures below to what the Company believes are the most directly comparable measures evaluated in accordance with GAAP.

This press release also includes certain projections of non-GAAP financial measures. Due to the high variability and difficulty in making accurate forecasts and projections of some of the information excluded from these projected measures, together with some of the excluded information not being ascertainable or accessible, the Company is unable to quantify certain amounts that would be required to be included in the most directly comparable GAAP financial measures without unreasonable effort. Consequently, no disclosure of estimated comparable GAAP measures is included and no reconciliation of the forward-looking non-GAAP financial measures is included.

Investor Contact:

Brian Denyeau

ICR, LLC

646-277-1251

IR@cccis.com

Media Contact:

Michael Nothnagel

CCC Intelligent Solutions Inc.

michael.nothnagel@teamlewis.com


CYPRESS HOLDINGS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)

 

    

June 30,

2021
(Unaudited)

    December 31,
2020
(Audited)
 

ASSETS

    

CURRENT ASSETS:

    

Cash and cash equivalents

   $ 58,506     $ 162,118  

Accounts receivable—Net of allowances of $4,218 and $4,224 for June 30, 2021 and December 31, 2020, respectively

     81,817       74,107  

Income taxes receivable

     1,244       2,037  

Deferred contract costs

     12,681       11,917  

Other current assets

     33,524       31,586  
  

 

 

   

 

 

 

Total current assets

     187,772       281,765  
  

 

 

   

 

 

 

SOFTWARE, EQUIPMENT, AND PROPERTY—Net

     108,640       101,438  

OPERATING LEASE ASSETS

     41,859       —    

INTANGIBLE ASSETS—Net

     1,262,608       1,311,917  

GOODWILL

     1,466,884       1,466,884  

DEFERRED FINANCING FEES, REVOLVER—Net

     598       746  

DEFERRED CONTRACT COSTS

     15,986       14,389  

EQUITY METHOD INVESTMENT

     10,228       —    

OTHER ASSETS

     16,684       18,416  
  

 

 

   

 

 

 

TOTAL

   $  3,111,259     $  3,195,555  
  

 

 

   

 

 

 

LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS’ EQUITY

    

CURRENT LIABILITIES:

    

Accounts payable

   $ 16,826     $ 13,164  

Accrued expenses

     58,393       52,987  

Income taxes payable

     4,293       5,129  

Current portion of long-term debt

     13,846       25,381  

Current portion of long-term licensing agreement—Net

     2,620       2,540  

Operating lease liabilities

     9,546        

Deferred revenues

     28,824       26,514  

Interest rate swap derivatives

     11,993       —    
  

 

 

   

 

 

 

Total current liabilities

     146,341       125,715  
  

 

 

   

 

 

 

FIRST LIEN TERM LOAN—Net

     1,299,774       1,292,597  

DEFERRED INCOME TAXES—Net

     311,280       322,348  

LONG-TERM LICENSING AGREEMENT—Net

     35,001       36,331  

OPERATING LEASE LIABILITIES

     41,338       —    

OTHER LIABILITIES

     11,711       32,770  
  

 

 

   

 

 

 

Total liabilities

     1,845,445       1,809,761  
  

 

 

   

 

 

 

COMMITMENTS AND CONTINGENCIES (Notes 20 and 21)

    

MEZZANINE EQUITY:

    

Redeemable non-controlling interests

     14,179       14,179  

STOCKHOLDERS’ EQUITY:

    

Preferred stock, $0.001 par; 1,500,000 shares authorized; no shares issued and outstanding

     —         —    

Common stock—Series A, $0.001 par; 3,000,000 shares authorized; 1,450,978 shares issued and outstanding at June 30, 2021 and December 31, 2020

     1       1  

Common stock—Series B, $0.001 par; 500,000 shares authorized; 33,178 and 29,785 shares issued and outstanding at June 30, 2021 and December 31, 2020, respectively

     —         —    

Additional paid-in capital

     1,517,123       1,501,255  

Accumulated deficit

     (265,189     (129,370

Accumulated other comprehensive loss

     (300     (271
  

 

 

   

 

 

 

Total stockholders’ equity

     1,251,635       1,371,615  
  

 

 

   

 

 

 

TOTAL

   $ 3,111,259     $ 3,195,555  
  

 

 

   

 

 

 

See notes to condensed consolidated financial statements.


CYPRESS HOLDINGS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(In thousands, except share and per share data)

(Unaudited)

 

     For the Three Months Ended     For the Six Months Ended  
     June 30,     June 30,  
     2021     2020     2021     2020  

REVENUES

   $ 166,789     $ 150,716     $ 324,578     $ 309,924  

COST OF REVENUES

        

Cost of revenues, exclusive of amortization of acquired technologies

     38,932       43,408       76,945       91,795  

Amortization of acquired technologies

     6,580       6,574       13,160       13,149  
  

 

 

   

 

 

   

 

 

   

 

 

 

Total cost of revenues

     45,512       49,982       90,105       104,944  
  

 

 

   

 

 

   

 

 

   

 

 

 

GROSS PROFIT

     121,277       100,734       234,473       204,980  
  

 

 

   

 

 

   

 

 

   

 

 

 

OPERATING EXPENSES:

        

Research and development

     31,253       27,772       61,877       55,315  

Selling and marketing

     21,551       17,702       40,968       39,181  

General and administrative

     28,394       21,566       66,233       44,566  

Amortization of intangible assets

     18,078       18,078       36,155       36,155  
  

 

 

   

 

 

   

 

 

   

 

 

 

Total operating expenses

     99,276       85,118       205,233       175,217  
  

 

 

   

 

 

   

 

 

   

 

 

 

OPERATING INCOME

     22,001       15,616       29,240       29,763  

INTEREST EXPENSE

     (18,903     (18,643     (37,669     (37,800

GAIN (LOSS) ON CHANGE IN FAIR VALUE OF INTEREST RATE SWAPS

     3,089       620       6,366       (20,527

LOSS ON EARLY EXTINGUISHMENT OF DEBT

     —         —         —         (8,615

OTHER INCOME—Net

     4       115       91       255  
  

 

 

   

 

 

   

 

 

   

 

 

 

PRETAX INCOME (LOSS)

     6,191       (2,292     (1,972     (36,924

INCOME TAX (PROVISION) BENEFIT

     (2,375     331       704       9,711  
  

 

 

   

 

 

   

 

 

   

 

 

 

NET INCOME (LOSS) INCLUDING NON-CONTROLLING INTEREST

     3,816       (1,961     (1,268     (27,213

Less: net income (loss) attributable to non-controlling interest

     —         —         —         —    
  

 

 

   

 

 

   

 

 

   

 

 

 

NET INCOME (LOSS) ATTRIBUTABLE TO CYPRESS HOLDINGS, INC.

   $ 3,816     $ (1,961   $ (1,268   $ (27,213

Net income (loss) per share attributable to Class A and Class B common stockholders:

        

Basic

   $ 2.57     $ (1.32   $ (0.85   $ (18.39

Diluted

   $ 2.48     $ (1.32   $ (0.85   $ (18.39

Weighted-average shares used in computing net income (loss) per share attributable to Class A and Class B common stockholders:

        

Basic

     1,484,156       1,480,262       1,483,634       1,479,918  

Diluted

     1,537,767       1,480,262       1,483,634       1,479,918  

COMPREHENSIVE INCOME (LOSS):

        

Net income (loss) including non-controlling interest

     3,816       (1,961     (1,268     (27,213

Other comprehensive loss—Foreign currency translation adjustment

     (36     (1     (29     (18
  

 

 

   

 

 

   

 

 

   

 

 

 

COMPREHENSIVE INCOME (LOSS) INCLUDING NON-CONTROLLING INTEREST

     3,780       (1,962     (1,297     (27,231

Less: comprehensive income (loss) attributable to non-controlling interest

     —         —         —         —    
  

 

 

   

 

 

   

 

 

   

 

 

 

COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO CYPRESS HOLDINGS, INC.

   $ 3,780     $ (1,962   $ (1,297   $ (27,231
  

 

 

   

 

 

   

 

 

   

 

 

 

See notes to condensed consolidated financial statements.


CYPRESS HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

 

     For the Six Months Ended  
     June 30,  
     2021     2020  

CASH FLOWS FROM OPERATING ACTIVITIES:

    

Net loss

   $ (1,268   $  (27,213

Adjustments to reconcile net loss to net cash provided by operating activities:

    

Depreciation and amortization of software, equipment, and property

     10,472       8,543  

Amortization of intangible assets

     49,315       49,304  

Deferred income taxes

     (11,068     (16,685

Stock-based compensation

     15,537       5,601  

Amortization of deferred financing fees

     2,321       2,146  

Amortization of discount on debt

     392       327  

Change in fair value of interest rate swaps

     (6,366     20,527  

Loss on early extinguishment of debt

     —         8,615  

Non-cash lease expense

     3,667       —    

Other

     34       13  

Changes in:

    

Accounts receivable—Net

     (7,749     (9,834

Deferred contract costs

     (765     128  

Other current assets

     (1,937     2,757  

Deferred contract costs—Non-current

     (1,597     (941

Other assets

     1,699       (10,254

Operating lease assets

     3,410       —    

Income taxes

     (43     7,256  

Accounts payable

     3,613       (115

Accrued expenses

     4,031       (17,324

Operating lease liabilities

     (3,900     —    

Deferred revenues

     2,303       1,127  

Other liabilities

     (2,281     (202
  

 

 

   

 

 

 

Net cash provided by operating activities

     59,820       23,776  
  

 

 

   

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES:

    

Purchases of software, equipment, and property

     (13,158     (12,512

Purchase of equity method investment

     (10,189     —    

Purchase of intangible asset

     (49     (560
  

 

 

   

 

 

 

Net cash used in investing activities

     (23,396     (13,072
  

 

 

   

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES:

    

Proceeds from issuance of non-controlling interest in subsidiary

     —         14,179  

Principal payments on long-term debt

     (6,923     (381,923

Proceeds from issuance of long-term debt, net of fees paid to lender

     —         369,792  

Proceeds from borrowings on revolving lines of credit

     —         65,000  

Repayment of borrowings on revolving lines of credit

     —         (65,000

Proceeds from issuance of Series B common stock

     1,007       —    

Payment of fees associated with early extinguishment of long-term debt

     —         (29

Proceeds from exercise of stock options

     503       242  

Repurchases of Series B common stock

     —         (101

Dividend to stockholders

     (134,549     —    
  

 

 

   

 

 

 

Net cash used in financing activities

     (139,962     2,160  
  

 

 

   

 

 

 

NET EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS

     (74     (46
  

 

 

   

 

 

 

NET CHANGE IN CASH AND CASH EQUIVALENTS

     (103,612     12,818  

CASH AND CASH EQUIVALENTS:

    

Beginning of period

     162,118       93,201  
  

 

 

   

 

 

 

End of period

   $ 58,506     $ 106,019  
  

 

 

   

 

 

 

NONCASH INVESTING AND FINANCING ACTIVITIES:

    

Unpaid liability related to software, equipment, and property

   $ 5,752     $ —    
  

 

 

   

 

 

 

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:

    

Cash paid for interest

   $ 35,020     $ 35,470  
  

 

 

   

 

 

 

Cash received (paid) for income taxes—Net

   $  (10,409   $ 283  
  

 

 

   

 

 

 


CYPRESS HOLDINGS, INC. AND SUBSIDIARIES

RECONCILIATION OF GROSS PROFIT TO ADJUSTED GROSS PROFIT

(In thousands, except profit margin percentage data)

(Unaudited)

 

     Three months ended June 30,     Six months ended June 30,  

(amounts in thousands)

   2021     2020     2021     2020  

Gross Profit

   $ 121,277     $ 100,734     $ 234,473     $ 204,980  

First Party Clinical Services—Gross Profit

     —         (141     —         (2,390

Amortization of acquired technologies

     6,580       6,574       13,160       13,149  

Stock-based compensation

     176       160       394       239  
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted Gross Profit

   $ 128,033     $ 107,327     $ 248,027     $ 215,978  
  

 

 

   

 

 

   

 

 

   

 

 

 

Gross Profit Margin Percentage

     73     67     72     66

Adjusted Gross Profit Margin Percentage

     77     74     76     70


CYPRESS HOLDINGS, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP OPERATING INCOME TO ADJUSTED OPERATING INCOME

(In thousands)

(Unaudited)

 

     Three months ended June 30,     Six months ended June 30,  

(dollar amounts in thousands)

   2021      2020     2021      2020  

GAAP Operating Income

   $ 22,001      $ 15,616     $ 29,240      $ 29,763  

Stock-based compensation expense

     2,883        2,371       15,537        5,601  

Lease abandonment

     925        —         1,850        —    

Lease overlap costs

     909        —         1,817        —    

Net costs related to divestiture

     1,494        —         2,266        —    

Business combination transaction costs

     1,953        —         4,955        —    

Amortization of intangible assets

     18,078        18,078       36,155        36,155  

Amortization of acquired technologies—Cost of revenue

     6,580        6,574       13,160        13,149  

First Party Clinical Services—Revenue

     —          (6,603     —          (18,255

First Party Clinical Services—Cost of revenue

     —          6,462       —          15,865  
  

 

 

    

 

 

   

 

 

    

 

 

 

Adjusted Operating Income

   $ 54,823      $ 42,498     $ 104,980      $ 82,278  
  

 

 

    

 

 

   

 

 

    

 

 

 


CYPRESS HOLDINGS, INC. AND SUBSIDIARIES

RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA

(In thousands)

(Unaudited)

 

     Three months ended June 30,     Six months ended June 30,  

(dollar amounts in thousands)

   2021     2020     2021     2020  

Net income (loss)

   $ 3,816     $ (1,961   $ (1,268   $ (27,213

Interest expense

     18,903       18,643       37,669       37,800  

Income tax provision (benefit)

     2,375       (331     (704     (9,711

Amortization of intangible assets

     18,078       18,078       36,155       36,155  

Amortization of acquired technologies—Cost of revenue

     6,580       6,574       13,160       13,149  

Depreciation and amortization related to software, equipment and property

     5,314       4,243       10,467       8,543  
  

 

 

   

 

 

   

 

 

   

 

 

 

EBITDA

     55,066       45,246       95,479       58,723  

(Gain) loss on change in fair value of interest rate swaps

     (3,089     (620     (6,366     20,527  

Stock-based compensation expense

     2,883       2,371       15,537       5,601  

Loss on early extinguishment of debt

     —         —         —         8,615  

Business combination transaction costs

     1,953       —         4,955       —    

Lease abandonment

     925       —         1,850       —    

Lease overlap costs

     909       —         1,817       —    

Net costs related to divestiture

     1,494       —         2,266       —    

First Party Clinical Services—Revenue

     —         (6,603     —         (18,255

First Party Clinical Services—Cost of revenue

     —         6,462       —         15,865  
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted EBITDA

   $ 60,141     $ 46,856     $ 115,538     $ 91,076  
  

 

 

   

 

 

   

 

 

   

 

 

 


CYPRESS HOLDINGS, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP NET INCOME (LOSS) TO ADJUSTED NET INCOME

(In thousands)

(Unaudited)

 

     Three months ended June 30,     Six months ended June 30,  

(dollar amounts in thousands)

   2021     2020     2021     2020  

GAAP Net Income (Loss)

   $ 3,816     $  (1,961   $  (1,268   $  (27,213

Stock-based compensation expense

     2,883       2,371       15,537       5,601  

Lease abandonment

     925       —         1,850       —    

Lease overlap costs

     909       —         1,817       —    

Net costs related to divestiture

     1,494       —         2,266       —    

Business combination transaction costs

     1,953       —         4,955       —    

(Gain) loss on change in fair value of interest rate swaps

     (3,089     (620     (6,366     20,527  

Loss on early extinguishment of debt

     —         —         —         8,615  

Amortization of intangible assets

     18,078       18,078       36,155       36,155  

Amortization of acquired technologies—Cost of revenue

     6,580       6,574       13,160       13,149  

First Party Clinical Services—Revenue

     —         (6,603     —         (18,255

First Party Clinical Services—Cost of revenue

     —         6,462       —         15,865  

Tax effect of adjustments

     (7,223     (6,828     (16,774     (21,231
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted Net Income

   $  26,326     $  17,473     $ 51,332     $ 33,213  
  

 

 

   

 

 

   

 

 

   

 

 

 


CYPRESS HOLDINGS, INC. AND SUBSIDIARIES

RECONCILIATION OF NET CASH FLOW FROM OPERATING ACTIVITIES TO FREE CASH FLOW

(In thousands)

(Unaudited)

 

     Three months ended June 30,     Six months ended June 30,  

(amounts in thousands)

   2021     2020     2021     2020  

Net cash provided by operating activities

   $  21,586     $  14,675     $ 59,820     $ 23,776  

Less: Purchases of software, equipment, and property

     (8,521     (7,068     (13,158     (12,512

Less: Purchase of intangible assets

     —         —         (49     (560
  

 

 

   

 

 

   

 

 

   

 

 

 

Free Cash Flow

   $ 13,065     $ 7,607     $ 46,613     $ 10,704