UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
Emerging growth company
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ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION.
Attached hereto as Exhibit 99.1 and incorporated by reference into this Item 2.02 is a copy of the press release, date November 10, 2021, announcing the financial results of CCC Intelligent Solutions Holdings Inc. for the quarter ended September 30, 2021, including, among other things, unaudited financial results for that period.
The information in this Item 2.02, including Exhibit 99.1 attached hereto, is being furnished and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section and shall not be incorporated by reference into any registration statement or other document filed pursuant to the Securities Act of 1933, as amended, or the Exchange Act, except as otherwise expressly stated in such filing.
| ITEM 9.01 | FINANCIAL STATEMENTS AND EXHIBITS. |
(d) Exhibits
| Exhibit Number | Description | |
| 99.1 | Press release, dated November 10, 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 thereunto duly authorized.
| CCC INTELLIGENT SOLUTIONS HOLDINGS INC. | ||||||
| Date: November 10, 2021 | ||||||
| By: | /s/ Brian Herb | |||||
| Name: | Brian Herb | |||||
| Title: | Executive Vice President, Chief Financial and Administrative Officer | |||||
Exhibit 99.1
CCC Intelligent Solutions Holdings Inc. Announces Third Quarter Fiscal 2021 Financial Results
November 10, 2021 – CCC Intelligent Solutions Holdings Inc. (CCC) (NYSE: CCCS), a leading SaaS platform for the P&C insurance economy, today announced its financial results for the three months ended September 30, 2021.
“CCC continued to perform at a high level in the third quarter, highlighted by 18% adjusted revenue growth and 31% adjusted EBITDA growth. We continue to see strong adoption of our expanding product portfolio as demand for cloud-based solutions to digitize workflows increases across the P&C insurance economy,” said Githesh Ramamurthy, Chairman & CEO of CCC.
Ramamurthy continued, “Our performance demonstrates the power of our growth model and we will continue to invest in the business to benefit our customers. We are thrilled with the pace of product innovation and the quality of customer feedback, giving us great confidence in our growth potential.”
Third Quarter 2021 Financial Highlights
Revenue
| • | Total revenue was $176.6 million for the third quarter of 2021, compared to $157.8 million for the third 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 18% in the third quarter of 2021. |
Profitability
| • | GAAP gross profit was $118.8 million, representing a gross margin of 67%, for the third quarter of 2021, compared with $107.3 million, representing a gross margin of 68%, for the third quarter of 2020. Adjusted gross profit was $138.4 million, representing an adjusted gross margin of 78%, for the third quarter of 2021, compared with $113.4 million, representing an adjusted gross margin of 76%, for the third quarter of 2020. |
| • | GAAP operating loss was $189.2 million for the third quarter of 2021, compared with GAAP operating income of $23.1 million for the third quarter of 2020. Adjusted operating income was $62.5 million for the third quarter of 2021, compared with adjusted operating income of $49.1 million for the third quarter of 2020. |
| • | GAAP net loss was $189.8 million for the third quarter of 2021, compared with GAAP net income of $4.7 million for the third quarter of 2020. Adjusted net income was $29.7 million for the third quarter of 2021, compared with $21.1 million for the third quarter of 2020. |
| • | Adjusted EBITDA was $70.1 million for the third quarter of 2021, compared with adjusted EBITDA of $53.6 million for the third quarter of 2020. Adjusted EBITDA grew 31% in the third quarter of 2021 as compared to the third quarter of 2020. |
Liquidity
| • | CCC had $160.5 million in cash and cash equivalents and $800.0 million of total debt at September 30, 2021. The Company generated $36.9 million in cash from operating activities and had free cash flow of $25.0 million during the third quarter of 2021, compared with $43.0 million generated in cash from operating activities and $31.7 million in free cash flow in the third quarter of 2020. |
The information presented above includes non-GAAP financial measures such as “adjusted EBITDA,” “adjusted net income,” “adjusted operating income,” “adjusted gross profit,” “adjusted gross profit 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.
3rd Quarter and Recent Business Highlights
| • | Announced the first touchless estimating experience in the industry. The AI-powered CCC® Estimate-STP uses advanced AI and insurer-driven rules to automatically initiate and populate detailed and actionable estimates in seconds. In market with four national insurers, CCC Estimate-STP offers touchless line level estimates from photos and is part of CCC’s broader offering that is digitizing the auto claims experience. |
| • | Signed multi-year renewals with a Top 5 insurer and one of the country’s largest multi-store operators, or MSOs. As part of the multi-year agreements these customers have meaningfully expanded their annual commitment to CCC as they broadened the number of solutions they utilize from the platform. |
| • | Partnered with Toyota to deliver Collision Assistance, a just-in-time support service, which is now available to drivers within the Toyota and Lexus mobile apps. The CCC mobile technology combines guided accident documentation and access to claims and management services to assist drivers following a collision. This is an example of how CCC is delivering innovation that expands our ecosystem beyond traditional insurer and repair facility customers. |
| • | Successfully completed the refinancing of its existing secured credit facility with a new credit agreement comprised of an $800 million senior secured term loan facility (the “Term Loan”) and a $250 million senior secured revolving credit facility (the “Revolving Facility”) that lowered our effective interest rate from 4.0% to 3.0%. |
Business Outlook
Based on information as of today, November 10, 2021, the Company is issuing the following financial guidance:
| Fourth Quarter Fiscal 2021 | Full Year Fiscal 2021 | |||
| Revenue |
$182 million to $184 million | $683 million to $685 million | ||
| Adjusted EBITDA |
$69 million to $71 million | $255 million to $257 million |
Year-over-year revenue growth for the fourth quarter of 2021 is forecasted to be 10%—11%, or 16%—17% 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 8%, or 14% on an adjusted basis. First Party Clinical Services revenue was $8.6 million and $34.7 million for our fiscal fourth quarter and full year 2020, respectively.
Conference Call Information
CCC will host a conference call today, November 10, 2021, at 5:00 p.m. (Eastern Time) to discuss the Company’s financial results and financial guidance. To access this call, dial 877-407-0784 (domestic) or 201-689-8560 (international). The conference ID number is 13723556. A live webcast of this conference call will be available on the “Investor Relations” page of the Company’s website at https://ir.cccis.com, and a replay will be archived on the website as well.
About CCC Intelligent Solutions
CCC Intelligent Solutions Inc. (CCC), a subsidiary of CCC Intelligent Solutions Holdings Inc. (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 impact of COVID-19 on CCC’s business; failure to realize the anticipated benefits of the business combination of CCC’s parent corporation and Dragoneer Growth Opportunities Corp. (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 adoption of CCC® Estimate-STP does not occur on the expected timing; the risk that the Company fails to realize the
expected benefits of customer renewals and expanding the Company’s customer base; 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 profit,” “adjusted gross profit 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 for these projections.
Investor Contact:
Brian Denyeau
ICR, LLC
646-277-1251
IR@cccis.com
Media Contact:
Michelle Hellyar
Director Public Relations, CCC Intelligent Solutions Inc.
mhellyar@cccis.com
CCC INTELLIGENT SOLUTIONS HOLDINGS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
| September 30, 2021 |
December 31, 2020 |
|||||||
| (Unaudited) | ||||||||
| ASSETS |
||||||||
| CURRENT ASSETS: |
||||||||
| Cash and cash equivalents |
$ | 160,465 | $ | 162,118 | ||||
| Accounts receivable—Net of allowances of $3,972 and $4,224 for September 30, 2021 and December 31, 2020, respectively |
82,367 | 74,107 | ||||||
| Income taxes receivable |
6,915 | 2,037 | ||||||
| Deferred contract costs |
13,833 | 11,917 | ||||||
| Other current assets |
36,261 | 31,586 | ||||||
|
|
|
|
|
|||||
| Total current assets |
299,841 | 281,765 | ||||||
|
|
|
|
|
|||||
| SOFTWARE, EQUIPMENT, AND PROPERTY—Net |
121,018 | 101,438 | ||||||
| OPERATING LEASE ASSETS |
38,774 | — | ||||||
| INTANGIBLE ASSETS—Net |
1,237,950 | 1,311,917 | ||||||
| GOODWILL |
1,466,884 | 1,466,884 | ||||||
| DEFERRED FINANCING FEES, REVOLVER—Net |
3,053 | 746 | ||||||
| DEFERRED CONTRACT COSTS |
18,893 | 14,389 | ||||||
| EQUITY METHOD INVESTMENT |
10,228 | — | ||||||
| OTHER ASSETS |
21,584 | 18,416 | ||||||
|
|
|
|
|
|||||
| TOTAL |
$ | 3,218,225 | $ | 3,195,555 | ||||
|
|
|
|
|
|||||
| LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS’ EQUITY |
||||||||
| CURRENT LIABILITIES: |
||||||||
| Accounts payable |
$ | 16,083 | $ | 13,164 | ||||
| Accrued expenses |
81,771 | 52,987 | ||||||
| Income taxes payable |
7,161 | 5,129 | ||||||
| Current portion of long-term debt |
8,000 | 25,381 | ||||||
| Current portion of long-term licensing agreement—Net |
2,661 | 2,540 | ||||||
| Operating lease liabilities |
8,855 | — | ||||||
| Deferred revenues |
29,384 | 26,514 | ||||||
|
|
|
|
|
|||||
| Total current liabilities |
153,915 | 125,715 | ||||||
|
|
|
|
|
|||||
| LONG-TERM DEBT: |
||||||||
| First Lien Term Loan—Net |
— | 1,292,597 | ||||||
| Term B Loan—Net |
780,218 | — | ||||||
|
|
|
|
|
|||||
| Total long-term debt |
780,218 | 1,292,597 | ||||||
|
|
|
|
|
|||||
| DEFERRED INCOME TAXES—Net |
255,849 | 322,348 | ||||||
| LONG-TERM LICENSING AGREEMENT—Net |
34,320 | 36,331 | ||||||
| OPERATING LEASE LIABILITIES |
50,550 | — | ||||||
| WARRANT LIABILITIES |
85,348 | — | ||||||
| OTHER LIABILITIES |
6,808 | 32,770 | ||||||
|
|
|
|
|
|||||
| Total liabilities |
1,367,008 | 1,809,761 | ||||||
|
|
|
|
|
|||||
| COMMITMENTS AND CONTINGENCIES (Notes 22 and 23) |
||||||||
| MEZZANINE EQUITY: |
||||||||
| Redeemable non-controlling interest |
14,179 | 14,179 | ||||||
| STOCKHOLDERS’ EQUITY: |
||||||||
| Preferred stock, $0.0001 par; 100,000,000 shares authorized; no shares issued or outstanding |
— | — | ||||||
| Common stock—$0.0001 par; 5,000,000,000 shares authorized; 603,170,380 and 504,274,890 shares issued and outstanding at September 30, 2021 and December 31, 2020, respectively |
60 | 50 | ||||||
| Additional paid-in capital |
2,525,750 | 1,501,206 | ||||||
| Accumulated deficit |
(688,483 | ) | (129,370 | ) | ||||
| Accumulated other comprehensive loss |
(289 | ) | (271 | ) | ||||
|
|
|
|
|
|||||
| Total stockholders’ equity |
1,837,038 | 1,371,615 | ||||||
|
|
|
|
|
|||||
| TOTAL |
$ | 3,218,225 | $ | 3,195,555 | ||||
|
|
|
|
|
|||||
CCC INTELLIGENT SOLUTIONS HOLDINGS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME
(In thousands, except share and per share data)
(Unaudited)
| For the Three Months Ended September 30, |
For the Nine Months Ended September 30, |
|||||||||||||||
| 2021 | 2020 | 2021 | 2020 | |||||||||||||
| REVENUES |
$ | 176,628 | $ | 157,754 | $ | 501,205 | $ | 467,677 | ||||||||
| COST OF REVENUES |
||||||||||||||||
| Cost of revenues, exclusive of amortization of acquired technologies |
51,273 | 43,879 | 128,218 | 135,674 | ||||||||||||
| Amortization of acquired technologies |
6,580 | 6,576 | 19,740 | 19,725 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total cost of revenues |
57,853 | 50,455 | 147,958 | 155,399 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| GROSS PROFIT |
118,775 | 107,299 | 353,247 | 312,278 | ||||||||||||
|
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|
|
|
|
|
|||||||||
| OPERATING EXPENSES: |
||||||||||||||||
| Research and development |
67,016 | 26,816 | 128,894 | 82,131 | ||||||||||||
| Selling and marketing |
80,382 | 17,427 | 121,350 | 56,608 | ||||||||||||
| General and administrative |
142,511 | 21,893 | 208,745 | 66,460 | ||||||||||||
| Amortization of intangible assets |
18,078 | 18,078 | 54,232 | 54,232 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total operating expenses |
307,987 | 84,214 | 513,221 | 259,431 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| OPERATING (LOSS) INCOME |
(189,212 | ) | 23,085 | (159,974 | ) | 52,847 | ||||||||||
| INTEREST EXPENSE |
(13,878 | ) | (19,788 | ) | (51,548 | ) | (57,588 | ) | ||||||||
| GAIN (LOSS) ON CHANGE IN FAIR VALUE OF INTEREST RATE SWAPS |
2,007 | 3,894 | 8,373 | (16,633 | ) | |||||||||||
| CHANGE IN FAIR VALUE OF WARRANT LIABILITIES |
(26,889 | ) | — | (26,889 | ) | — | ||||||||||
| LOSS ON EARLY EXINGUISHMENT OF DEBT |
(15,240 | ) | — | (15,240 | ) | (8,615 | ) | |||||||||
| OTHER (EXPENSE) INCOME—Net |
(93 | ) | 49 | 1 | 304 | |||||||||||
|
|
|
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|
|
|
|
|
|||||||||
| PRETAX (LOSS) INCOME |
(243,305 | ) | 7,240 | (245,277 | ) | (29,685 | ) | |||||||||
| INCOME TAX BENEFIT (PROVISION) |
53,523 | (2,520 | ) | 54,227 | 7,191 | |||||||||||
|
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|
|
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|
|
|
|
|||||||||
| NET (LOSS) INCOME INCLUDING NON-CONTROLLING INTEREST |
(189,782 | ) | 4,720 | (191,050 | ) | (22,494 | ) | |||||||||
| Less: net (loss) income attributable to non-controlling interest |
— | — | — | — | ||||||||||||
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|
|||||||||
| NET (LOSS) INCOME ATTRIBUTABLE TO CCC INTELLIGENT SOLUTIONS |
||||||||||||||||
| HOLDINGS INC. |
$ | (189,782 | ) | $ | 4,720 | $ | (191,050 | ) | $ | (22,494 | ) | |||||
| Net (loss) income per share attributable to common stockholders: |
||||||||||||||||
| Basic |
$ | (0.34 | ) | $ | 0.01 | $ | (0.36 | ) | $ | (0.04 | ) | |||||
| Diluted |
$ | (0.34 | ) | $ | 0.01 | $ | (0.36 | ) | $ | (0.04 | ) | |||||
| Weighted-average shares used in computing net (loss) income per share attributable to common stockholders: |
||||||||||||||||
| Basic |
566,454,782 | 504,212,021 | 525,877,533 | 504,062,587 | ||||||||||||
| Diluted |
566,454,782 | 510,694,493 | 525,877,533 | 504,062,587 | ||||||||||||
| COMPREHENSIVE (LOSS) INCOME: |
||||||||||||||||
| Net (loss) income including non-controlling interest |
(189,782 | ) | 4,720 | (191,050 | ) | (22,494 | ) | |||||||||
| Other comprehensive income (loss)—Foreign currency translation adjustment |
11 | 83 | (18 | ) | 65 | |||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| COMPREHENSIVE (LOSS) INCOME INCLUDING NON-CONTROLLING INTEREST |
(189,771 | ) | 4,803 | (191,068 | ) | (22,429 | ) | |||||||||
| Less: comprehensive (loss) income attributable to non-controlling interest |
— | — | — | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| COMPREHENSIVE (LOSS) INCOME ATTRIBUTABLE TO CCC INTELLIGENT |
||||||||||||||||
| SOLUTIONS HOLDINGS INC. |
$ | (189,771 | ) | $ | 4,803 | $ | (191,068 | ) | $ | (22,429 | ) | |||||
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CCC INTELLIGENT SOLUTIONS HOLDINGS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
| For the Nine Months Ended | ||||||||
| September 30, | ||||||||
| 2021 | 2020 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: |
||||||||
| Net loss |
$ | (191,050 | ) | $ | (22,494 | ) | ||
| Adjustments to reconcile net loss to net cash provided by operating activities: |
||||||||
| Depreciation and amortization of software, equipment, and property |
18,161 | 13,039 | ||||||
| Amortization of intangible assets |
73,972 | 73,957 | ||||||
| Deferred income taxes |
(66,499 | ) | (18,018 | ) | ||||
| Stock-based compensation |
235,413 | 7,471 | ||||||
| Amortization of deferred financing fees |
3,204 | 3,475 | ||||||
| Amortization of discount on debt |
537 | 553 | ||||||
| Change in fair value of interest rate swaps |
(8,373 | ) | 16,633 | |||||
| Change in fair value of warrant liabilities |
26,889 | — | ||||||
| Loss on early extinguishment of debt |
15,240 | 8,615 | ||||||
| Non-cash lease expense |
5,029 | — | ||||||
| Other |
54 | 42 | ||||||
| Changes in: |
||||||||
| Accounts receivable—Net |
(8,332 | ) | (12,644 | ) | ||||
| Deferred contract costs |
(1,916 | ) | (507 | ) | ||||
| Other current assets |
(4,673 | ) | (755 | ) | ||||
| Deferred contract costs—Non-current |
(4,504 | ) | (1,246 | ) | ||||
| Other assets |
(3,221 | ) | (10,795 | ) | ||||
| Operating lease assets |
5,133 | — | ||||||
| Income taxes |
(2,846 | ) | 11,597 | |||||
| Accounts payable |
1,399 | 2,080 | ||||||
| Accrued expenses |
17,051 | (5,183 | ) | |||||
| Operating lease liabilities |
(5,935 | ) | — | |||||
| Deferred revenues |
2,861 | 580 | ||||||
| Extinguishment of interest rate swap liability |
(9,987 | ) | — | |||||
| Other liabilities |
(882 | ) | 389 | |||||
|
|
|
|
|
|||||
| Net cash provided by operating activities |
96,725 | 66,789 | ||||||
|
|
|
|
|
|||||
| CASH FLOWS FROM INVESTING ACTIVITIES: |
||||||||
| Purchases of software, equipment, and property |
(25,022 | ) | (23,815 | ) | ||||
| Purchase of equity method investment |
(10,228 | ) | — | |||||
| Purchase of intangible asset |
(49 | ) | (560 | ) | ||||
|
|
|
|
|
|||||
| Net cash used in investing activities |
(35,299 | ) | (24,375 | ) | ||||
|
|
|
|
|
|||||
| CASH FLOWS FROM FINANCING ACTIVITIES: |
||||||||
| Proceeds from issuance of non-controlling interest in subsidiary |
— | 14,179 | ||||||
| Deemed distribution to CCCIS option holders |
(9,006 | ) | — | |||||
| Net proceeds from equity infusion from the Business Combination |
763,300 | — | ||||||
| Principal payments on long-term debt |
(1,336,154 | ) | (385,385 | ) | ||||
| Proceeds from issuance of long-term debt, net of fees paid to lender |
789,927 | 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 common stock |
1,007 | — | ||||||
| Payment of fees associated with early extinguishment of long-term debt |
(3,320 | ) | (29 | ) | ||||
| Proceeds from exercise of stock options |
503 | 618 | ||||||
| Repurchases of common stock |
— | (123 | ) | |||||
| Dividends to CCCIS stockholders |
(269,174 | ) | — | |||||
|
|
|
|
|
|||||
| Net cash used in financing activities |
(62,917 | ) | (948 | ) | ||||
|
|
|
|
|
|||||
| NET EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS |
(162 | ) | 108 | |||||
|
|
|
|
|
|||||
| NET CHANGE IN CASH AND CASH EQUIVALENTS |
(1,653 | ) | 41,574 | |||||
| CASH AND CASH EQUIVALENTS: |
||||||||
| Beginning of period |
162,118 | 93,201 | ||||||
|
|
|
|
|
|||||
| End of period |
$ | 160,465 | $ | 134,775 | ||||
|
|
|
|
|
|||||
| NONCASH INVESTING AND FINANCING ACTIVITIES: |
||||||||
| Unpaid liability related to software, equipment, and property |
$ | 4,054 | $ | — | ||||
|
|
|
|
|
|||||
| Leasehold improvements acquired by tenant improvement allowance |
$ | 10,556 | $ | — | ||||
|
|
|
|
|
|||||
| SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: |
||||||||
| Cash paid for interest, excluding extinguishment of interest rate swap liability |
$ | 47,312 | $ | 52,217 | ||||
|
|
|
|
|
|||||
| Cash received (paid) for income taxes—Net |
$ | (15,119 | ) | $ | 770 | |||
|
|
|
|
|
|||||
CCC INTELLIGENT SOLUTIONS HOLDINGS INC. AND SUBSIDIARIES
RECONCILIATION OF GROSS PROFIT TO ADJUSTED GROSS PROFIT
(In thousands, except profit margin percentage data)
(Unaudited)
| Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
| (amounts in thousands, except percentages) |
2021 | 2020 | 2021 | 2020 | ||||||||||||
| Gross Profit |
$ | 118,775 | $ | 107,299 | $ | 353,247 | $ | 312,278 | ||||||||
| First Party Clinical Services—Gross Profit |
— | (645 | ) | — | (3,035 | ) | ||||||||||
| Amortization of acquired technologies |
6,580 | 6,576 | 19,740 | 19,725 | ||||||||||||
| Business combination transaction costs |
905 | — | 905 | — | ||||||||||||
| Stock-based compensation |
12,169 | 141 | 12,563 | 380 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Adjusted Gross Profit |
$ | 138,429 | $ | 113,371 | $ | 386,455 | $ | 329,348 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Gross Profit Margin |
67 | % | 68 | % | 70 | % | 67 | % | ||||||||
| Adjusted Gross Profit Margin |
78 | % | 76 | % | 77 | % | 75 | % | ||||||||
CCC INTELLIGENT SOLUTIONS HOLDINGS INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP OPERATING (LOSS) INCOME TO ADJUSTED OPERATING INCOME
(In thousands)
(Unaudited)
| Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
| (dollar amounts in thousands) |
2021 | 2020 | 2021 | 2020 | ||||||||||||
| Net operating (loss) income |
$ | (189,212 | ) | $ | 23,085 | $ | (159,974 | ) | $ | 52,847 | ||||||
| Stock-based compensation expense |
219,876 | 1,869 | 235,413 | 7,471 | ||||||||||||
| Lease abandonment |
438 | — | 2,256 | — | ||||||||||||
| Lease overlap costs |
924 | — | 2,773 | — | ||||||||||||
| Net costs related to divestiture |
338 | — | 2,605 | — | ||||||||||||
| Business combination transaction costs |
5,516 | 93 | 10,471 | 93 | ||||||||||||
| Amortization of intangible assets |
18,078 | 18,078 | 54,232 | 54,232 | ||||||||||||
| Amortization of acquired technologies—Cost of revenue |
6,580 | 6,576 | 19,740 | 19,725 | ||||||||||||
| First Party Clinical Services—Revenue |
— | (7,830 | ) | — | (26,083 | ) | ||||||||||
| First Party Clinical Services—Cost of revenue |
— | 7,185 | — | 23,048 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Adjusted operating income |
$ | 62,538 | $ | 49,056 | $ | 167,516 | $ | 131,333 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
CCC INTELLIGENT SOLUTIONS HOLDINGS INC. AND SUBSIDIARIES
RECONCILIATION OF NET (LOSS) INCOME TO ADJUSTED EBITDA
(In thousands)
(Unaudited)
| Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
| (dollar amounts in thousands) |
2021 | 2020 | 2021 | 2020 | ||||||||||||
| Net (loss) income |
$ | (189,782 | ) | $ | 4,720 | $ | (191,050 | ) | $ | (22,494 | ) | |||||
| Interest expense |
13,878 | 19,788 | 51,548 | 57,588 | ||||||||||||
| Income tax provision (benefit) |
(53,523 | ) | 2,520 | (54,227 | ) | (7,191 | ) | |||||||||
| Amortization of intangible assets |
18,078 | 18,078 | 54,232 | 54,232 | ||||||||||||
| Amortization of acquired technologies—Cost of revenue |
6,580 | 6,576 | 19,740 | 19,725 | ||||||||||||
| Depreciation and amortization related to software, equipment and property |
7,694 | 4,496 | 18,161 | 13,039 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| EBITDA |
(197,075 | ) | 56,178 | (101,596 | ) | 114,899 | ||||||||||
| (Gain) loss on change in fair value of interest rate swaps |
(2,007 | ) | (3,894 | ) | (8,373 | ) | 16,633 | |||||||||
| Change in fair value of warrant liabilities |
26,889 | — | 26,889 | — | ||||||||||||
| Stock-based compensation expense |
219,876 | 1,869 | 235,413 | 7,471 | ||||||||||||
| Loss on early extinguishment of debt |
15,240 | — | 15,240 | 8,615 | ||||||||||||
| Business combination transaction costs |
5,516 | 93 | 10,471 | 93 | ||||||||||||
| Lease abandonment |
438 | — | 2,256 | — | ||||||||||||
| Lease overlap costs |
924 | — | 2,773 | — | ||||||||||||
| Net costs related to divestiture |
338 | — | 2,605 | — | ||||||||||||
| First Party Clinical Services—Revenue |
— | (7,830 | ) | — | (26,083 | ) | ||||||||||
| First Party Clinical Services—Cost of revenue |
— | 7,185 | — | 23,048 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Adjusted EBITDA |
$ | 70,139 | $ | 53,601 | $ | 185,678 | $ | 144,676 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
CCC INTELLIGENT SOLUTIONS HOLDINGS INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP NET (LOSS) INCOME TO ADJUSTED NET INCOME
(In thousands)
(Unaudited)
| Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
| (dollar amounts in thousands) |
2021 | 2020 | 2021 | 2020 | ||||||||||||
| Net (loss) income |
$ | (189,782 | ) | $ | 4,720 | $ | (191,050 | ) | $ | (22,494 | ) | |||||
| Amortization of intangible assets |
18,078 | 18,078 | 54,232 | 54,232 | ||||||||||||
| Amortization of acquired technologies—Cost of revenue |
6,580 | 6,576 | 19,740 | 19,725 | ||||||||||||
| (Gain) loss on change in fair value of interest rate swaps |
(2,007 | ) | (3,894 | ) | (8,373 | ) | 16,633 | |||||||||
| Change in fair value of warrant liabilities |
26,889 | — | 26,889 | — | ||||||||||||
| Stock-based compensation expense |
219,876 | 1,869 | 235,413 | 7,471 | ||||||||||||
| Loss on early extinguishment of debt |
15,240 | — | 15,240 | 8,615 | ||||||||||||
| Business combination transaction costs |
5,516 | 93 | 10,471 | 93 | ||||||||||||
| Lease abandonment |
438 | — | 2,256 | — | ||||||||||||
| Lease overlap costs |
924 | — | 2,773 | — | ||||||||||||
| Net costs related to divestiture |
338 | — | 2,605 | — | ||||||||||||
| First Party Clinical Services—Revenue |
— | (7,830 | ) | — | (26,083 | ) | ||||||||||
| First Party Clinical Services—Cost of revenue |
— | 7,185 | — | 23,048 | ||||||||||||
| Tax effect of adjustments |
(72,360 | ) | (5,716 | ) | (89,134 | ) | (26,947 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Adjusted net income |
$ | 29,730 | $ | 21,081 | $ | 81,062 | $ | 54,293 | ||||||||
| Adjusted net income per share attributable to common stockholders |
||||||||||||||||
| Basic |
$ | 0.05 | $ | 0.04 | $ | 0.15 | $ | 0.11 | ||||||||
| Diluted |
$ | 0.05 | $ | 0.04 | $ | 0.15 | $ | 0.11 | ||||||||
| Weighted average shares outstanding |
||||||||||||||||
| Basic |
566,454,782 | 504,212,021 | 525,877,533 | 504,062,587 | ||||||||||||
| Diluted |
599,675,416 | 510,694,493 | 554,818,300 | 510,252,470 | ||||||||||||
CCC INTELLIGENT SOLUTIONS HOLDINGS INC. AND SUBSIDIARIES
RECONCILIATION OF NET CASH FLOW FROM OPERATING ACTIVITIES TO FREE CASH FLOW
(In thousands)
(Unaudited)
| Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
| (dollar amounts in thousands) |
2021 | 2020 | 2021 | 2020 | ||||||||||||
| Net cash provided by operating activities |
$ | 36,905 | $ | 43,013 | $ | 96,725 | $ | 66,789 | ||||||||
| Less: Purchases of software, equipment, and property |
(11,864 | ) | (11,303 | ) | (25,022 | ) | (23,815 | ) | ||||||||
| Less: Purchase of intangible assets |
— | — | (49 | ) | (560 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Free Cash Flow |
$ | 25,041 | $ | 31,710 | $ | 71,654 | $ | 42,414 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||