false000181820100018182012024-02-282024-02-28

 

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): February 28, 2024

 

 

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.)
167 N. Green Street, 9th Floor
Chicago, Illinois				60607
(Address of Principal Executive Offices)				(Zip Code)

 

Registrant’s Telephone Number, Including Area Code: (800) 621-8070

 

(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 Nasdaq Stock Market LLC

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. ☐

 

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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 February 28, 2024, announcing the financial results of CCC Intelligent Solutions Holdings Inc. for the quarter and year ended December 31, 2023.

 

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 February 28, 2024
104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

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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:	February 28, 2024	By:	/s/ Brian Herb
		Name: Title:	Brian Herb Executive Vice President, Chief Financial and Administrative Officer

 

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CCC Intelligent Solutions Holdings Inc. Announces Fourth Quarter and Fiscal Year 2023 Financial Results

February 28, 2024 – CCC Intelligent Solutions Holdings Inc. (“CCC” or the “Company”) (NASDAQ: CCCS), a leading SaaS platform for the P&C insurance economy, today announced its financial results for the three months and year ended December 31, 2023.

“CCC delivered another year of strong financial performance, with year-over-year revenue growth in 2023 of 11% and adjusted EBITDA margin of 41% – both above our guidance ranges. We believe our strong performance is the result of a growing interest in advanced digital solutions across the P&C insurance economy and the trust our customers place in us from years of delivering innovation and operational performance,” said Githesh Ramamurthy, Chairman & CEO of CCC.

“In 2023, we made significant investments in the business to position CCC for continued growth, including expanding our multi-sided network as well as increasing our growth capacity and capabilities,” continued Ramamurthy. “While making these critical investments to support our customers, we also delivered significant year-over-year margin expansion."

 

Fourth Quarter 2023 Financial Highlights

Revenue

Profitability

Full Year 2023 Financial Highlights

Revenue

Profitability

Liquidity

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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.

4th Quarter and Recent Business Highlights

Business Outlook

Based on information as of today, February 28, 2024, the Company is issuing the following financial guidance:

	First Quarter Fiscal 2024	Full Year Fiscal 2024

 

Revenue	$224.5 million to $226.0 million	$942.0 million to $950.0 million
Adjusted EBITDA	$90.5 million to $92.0 million	$387.0 million to $395.0 million

Conference Call Information

CCC will host a conference call today, February 28, 2024, at 5:00 p.m. (Eastern Time) to discuss the Company’s financial results and financial guidance. 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., a subsidiary of CCC Intelligent Solutions Holdings Inc. (NASDAQ: 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 35,000 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

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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, 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, our revenues, the concentration of our customers and the ability to retain our current customers; our ability to negotiate with our customers on favorable terms; our ability to maintain and grow our brand and reputation cost-effectively; the execution of our growth strategy; the impact of public health outbreaks, epidemics or pandemics on our business and results of operations; our projected financial information, growth rate and market opportunity; the health of our industry, claim volumes, and market conditions; changes in the insurance and automotive collision industries, including the adoption of new technologies; global economic conditions and geopolitical events; competition in our market and our ability to retain and grow market share; our ability to develop, introduce and market new enhanced versions of our solutions; our sales and implementation cycles; the ability of our research and development efforts to create significant new revenue streams; changes in applicable laws or regulations; changes in international economic, political, social and governmental conditions and policies, including corruption risks in China and other countries; our reliance on third-party data, technology and intellectual property; changes in our customers’ or the public’s perceptions regarding the use of artificial intelligence; our ability to protect our intellectual property; our ability to keep our data and information systems secure from data security breaches; our ability to acquire or invest in companies or pursue business partnerships; our ability to raise financing in the future and improve our capital structure; our success in retaining or recruiting, or changes required in, our officers, key employees or directors; our estimates regarding expenses, future revenue, capital requirements and needs for additional financing; our ability to expand or maintain our existing customer base; our ability to service our indebtedness; and other risks and uncertainties, including those included under the header “Risk Factors” in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the Securities and Exchange Commission (“SEC”), which can be obtained, without charge, at the SEC’s website (www.sec.gov), and in our other filings with the SEC. 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,” “adjusted operating expenses,” 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:

Bill Warmington

VP, Investor Relations, CCC Intelligent Solutions Inc.

312-229-2355

IR@cccis.com

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Media Contact:

Michelle Hellyar

Senior Director, Public Relations, CCC Intelligent Solutions Inc.

mhellyar@cccis.com

 

 

CCC INTELLIGENT SOLUTIONS HOLDINGS INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)

		December 31,				December 31,
		2023				2022
ASSETS
CURRENT ASSETS:
Cash and cash equivalents		$	195,572			$	323,788
Accounts receivable—Net of allowances of $5,574 and $5,339 as of December 31, 2023 and 2022, respectively			102,365				98,353
Income taxes receivable			1,798				4,015
Deferred contract costs			17,900				16,556
Other current assets			32,364				36,358
Total current assets			349,999				479,070
SOFTWARE, EQUIPMENT, AND PROPERTY—Net			160,416				146,443
OPERATING LEASE ASSETS			30,456				32,874
INTANGIBLE ASSETS—Net			1,015,046				1,118,819
GOODWILL			1,417,724				1,495,129
DEFERRED FINANCING FEES, REVOLVER—Net			1,672				2,286
DEFERRED CONTRACT COSTS			22,302				20,161
EQUITY METHOD INVESTMENT			10,228				10,228
OTHER ASSETS			43,197				45,911
TOTAL		$	3,051,040			$	3,350,921
LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable		$	16,324			$	27,599
Accrued expenses			71,478				71,445
Income taxes payable			3,689				922
Current portion of long-term debt			8,000				8,000
Current portion of long-term licensing agreement—Net			3,061				2,876
Operating lease liabilities			6,788				5,484
Deferred revenues			43,567				35,239
Total current liabilities			152,907				151,565
LONG-TERM DEBT—Net			767,504				774,132
DEFERRED INCOME TAXES—Net			195,365				241,698
LONG-TERM LICENSING AGREEMENT—Net			27,692				30,752
OPERATING LEASE LIABILITIES			50,796				54,245
WARRANT LIABILITIES			51,501				36,405
OTHER LIABILITIES			6,414				2,658
Total liabilities			1,252,179				1,291,455
COMMITMENTS AND CONTINGENCIES (Notes 23 and 24)
MEZZANINE EQUITY:
Redeemable non-controlling interest			16,584				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; 603,128,781 and 622,072,905 shares issued and outstanding at December 31, 2023 and 2022, respectively			60				62
Additional paid-in capital			2,909,757				2,754,055
Accumulated deficit			(1,126,467	)			(707,946	)
Accumulated other comprehensive loss			(1,073	)			(884	)
Total stockholders’ equity			1,782,277				2,045,287
TOTAL		$	3,051,040			$	3,350,921

 

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CCC INTELLIGENT SOLUTIONS HOLDINGS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(In thousands, except share and per share data)

(Unaudited)

		Three months ended December 31,								Year ended December 31,
		2023				2022				2023				2022
REVENUES		$	228,601			$	204,106			$	866,378			$	782,448
COST OF REVENUES
Cost of revenues, exclusive of amortization of acquired technologies			49,370				51,827				203,324				187,001
Amortization of acquired technologies			6,567				6,745				26,464				26,938
Impairment of acquired technologies			—				—				431				—
Total cost of revenues (1)			55,937				58,572				230,219				213,939
GROSS PROFIT			172,664				145,534				636,159				568,509
OPERATING EXPENSES:
Research and development (1)			45,215				42,246				173,106				156,957
Selling and marketing (1)			35,779				30,863				140,851				119,594
General and administrative (1)			54,367				44,665				191,844				167,758
Amortization of intangible assets			17,942				18,066				71,972				72,278
Impairment of goodwill			—				—				77,405				—
Impairment of intangible assets			—				—				4,906				—
Total operating expenses			153,303				135,840				660,084				516,587
OPERATING INCOME (LOSS)			19,361				9,694				(23,925	)			51,922
INTEREST EXPENSE			(16,652	)			(13,204	)			(63,577	)			(38,990	)
INTEREST INCOME			3,806				908				16,252				908
CHANGE IN FAIR VALUE OF WARRANT LIABILITIES			30,308				2,621				(15,096	)			26,073
GAIN ON SALE OF COST METHOD INVESTMENT			—				—				—				3,587
OTHER INCOME—Net			(3,761	)			(205	)			1,799				6,362
PRETAX INCOME (LOSS)			33,062				(186	)			(84,547	)			49,862
INCOME TAX (PROVISION) BENEFIT			(6,770	)			1,258				(5,524	)			(11,456	)
NET INCOME (LOSS) INCLUDING NON-CONTROLLING INTEREST			26,292				1,072				(90,071	)			38,406
LESS: ACCRETION OF REDEEMABLE NON-CONTROLLING INTEREST			(1,080	)			—				(2,405	)			—
NET INCOME (LOSS) ATTRIBUTABLE TO CCC INTELLIGENT SOLUTIONS HOLDINGS INC.'S COMMON STOCKHOLDERS		$	25,212			$	1,072			$	(92,476	)		$	38,406
Net income (loss) per share attributable to common stockholders:
Basic		$	0.04			$	0.00			$	(0.15	)		$	0.06
Diluted (2)		$	(0.01	)		$	0.00			$	(0.15	)		$	0.06
Weighted-average shares used in computing net income (loss) per share    attributable to common stockholders:
Basic			609,128,048				612,448,089				617,889,384				607,760,886
Diluted			609,387,346				643,941,176				617,889,384				642,841,596
COMPREHENSIVE INCOME (LOSS):
Net income (loss) including non-controlling interest			26,292				1,072				(90,071	)			38,406
Other comprehensive income (loss)—Foreign currency translation    adjustment			85				235				(189	)			(569	)
COMPREHENSIVE INCOME (LOSS) INCLUDING    NON-CONTROLLING INTEREST			26,377				1,307				(90,260	)			37,837
Less: accretion of redeemable non-controlling interest			(1,080	)			—				(2,405	)			—
COMPREHENSIVE INCOME (LOSS) INCLUDING    NON-CONTROLLING INTEREST		$	25,297			$	1,307			$	(92,665	)		$	37,837

 

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(1) Includes stock-based compensation expense as follows (in thousands):
		Three months ended December 31,								Year Ended December 31,
		2023				2022				2023				2022
Cost of revenues		$	2,207			$	1,645			$	8,802			$	5,812
Research and development			6,634				5,103				25,467				19,536
Sales and marketing			7,940				6,978				33,204				25,309
General and administrative			23,266				15,002				77,045				58,840
Total stock-based compensation expense		$	40,047			$	28,728			$	144,518			$	109,497

 

(2) The following table sets forth a reconciliation of the numerator and denominator used to compute diluted earnings per share of common stock (in thousands, except for share data):
		Three months ended December 31,								Year Ended December 31,
		2023				2022				2023				2022
Numerator
Net income (loss)		$	26,292			$	1,072			$	(90,071	)		$	38,406
Accretion of redeemable non-controlling interest			(1,080	)			—				(2,405	)			—
Change in fair value of in-the-money warrant liabilities			(30,308	)			—				—				—
Net (loss) income attributable to common stockholders		$	(5,096	)		$	1,072			$	(92,476	)		$	38,406
Denominator
Weighted average shares of common stock - basic			609,128,048				612,448,089				617,889,384				607,760,886
Dilutive effect of stock-based awards			-				31,493,087				-				35,080,710
Dilutive effect of assumed conversion of warrants			259,298				-				-				-
Weighted average shares of common stock - diluted			609,387,346				643,941,176				617,889,384				642,841,596

 

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CCC INTELLIGENT SOLUTIONS HOLDINGS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

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	Year ended December 31,
	2023				2022
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss) income	$	(90,071	)		$	38,406
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation and amortization of software, equipment, and property		36,902				27,933
Amortization of intangible assets		98,436				99,216
Impairment of goodwill and intangible assets		82,742				—
Deferred income taxes		(46,333	)			(34,401	)
Stock-based compensation		144,518				109,497
Amortization of deferred financing fees		1,753				1,878
Amortization of discount on debt		233				257
Change in fair value of derivative instruments		5,743				(5,663	)
Change in fair value of warrant liabilities		15,096				(26,073	)
Change in fair value of estimated contingent consideration		—				(100	)
Loss on early extinguishment of debt		—				—
Non-cash lease expense		1,232				3,697
Gain on divestitures		—				—
Gain on sale of cost method investment		—				(3,587	)
Loss on disposal of software, equipment and property		79				2,651
Other		620				104
Changes in:
Accounts receivable—Net		(4,001	)			(19,844	)
Deferred contract costs		(1,344	)			(1,487	)
Other current assets		4,046				9,792
Deferred contract costs—Non-current		(2,141	)			1,956
Other assets		(3,649	)			(14,501	)
Operating lease assets		1,186				3,448
Income taxes		4,984				(10,018	)
Accounts payable		(11,270	)			15,516
Accrued expenses		1,041				4,592
Operating lease liabilities		(2,145	)			(7,241	)
Deferred revenues		8,321				4,196
Extinguishment of interest rate swap liability		—				—
Other liabilities		4,055				(317	)
Net cash provided by operating activities		250,033				199,907
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of software, equipment, and property		(55,032	)			(47,951	)
Proceeds from sale of cost method investment		—				3,901
Acquisition of Safekeep, Inc., net of cash		—				(32,242	)
Purchase of equity method investment		—				—
Purchase of intangible asset		—				—
Net cash used in investing activities		(55,032	)			(76,292	)
CASH FLOWS (USED IN) PROVIDED BY FINANCING ACTIVITIES:
Proceeds from exercise of stock options		25,381				27,693
Proceeds from employee stock purchase plan		4,761				3,197
Principal payments on long-term debt		(8,000	)			(8,000	)
Payments for employee taxes withheld upon vesting of equity awards		(16,715	)			(5,015	)
Repurchase of common stock		(328,453	)			—
Proceeds from issuance of long-term debt, net of fees paid to lender		—				—
Net proceeds from equity infusion from the Business Combination		—				—
Payment of fees associated with early extinguishment of long-term debt		—				—
Dividends to CCCIS stockholders		—				—
Deemed distribution to CCCIS option holders		—				—
Proceeds from issuance of common stock		—				—
Tax effect of Business Combination transaction costs		—				—
Net cash (used in) provided by financing activities		(323,026	)			17,875
NET EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS		(191	)			(246	)
NET CHANGE IN CASH AND CASH EQUIVALENTS		(128,216	)			141,244
CASH AND CASH EQUIVALENTS:
Beginning of period		323,788				182,544
End of period	$	195,572			$	323,788
NONCASH INVESTING AND FINANCING ACTIVITIES:
Noncash purchases of software, equipment, and property	$	2,044			$	100
Leasehold improvements acquired by tenant improvement allowance	$	—			$	—
Fair value of assumed Public Warrants exercised	$	—			$	—
Contingent consideration related to business acquisition	$	—			$	200
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid for interest	$	61,367			$	36,636
Cash paid for income taxes—Net	$	42,948			$	55,697

 

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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 December 31,								Year ended December 31,
(dollar amounts in thousands)		2023				2022				2023				2022
Gross Profit		$	172,664			$	145,534			$	636,159			$	568,509
Amortization of acquired technologies			6,567				6,745				26,464				26,938
Stock-based compensation and related employer payroll tax			2,223				1,712				9,129				6,090
Impairment of acquired technologies			—				—				431				—
Contract termination costs			—				3,248				—				3,248
Business combination transaction costs			—				—				—				—
Adjusted Gross Profit		$	181,454			$	157,239			$	672,183			$	604,785
Gross Profit Margin			76	%			71	%			73	%			73	%
Adjusted Gross Profit Margin			79	%			77	%			78	%			77	%

 

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CCC INTELLIGENT SOLUTIONS HOLDINGS INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP OPERATING EXPENSES TO ADJUSTED OPERATING EXPENSES

(In thousands)

(Unaudited)

		Three months ended December 31,								Year ended December 31,
(dollar amounts in thousands)		2023				2022				2023				2022
Operating expenses		$	153,303			$	135,840			$	660,084			$	516,587
Amortization of intangible assets			(17,942	)			(18,066	)			(71,972	)			(72,278	)
Stock-based compensation expense and related    employer payroll tax			(38,001	)			(27,279	)			(138,578	)			(105,775	)
Goodwill and intangible asset impairment charges			—				—				(82,311	)			—
Plaintiff litigation costs			(1,150	)			(894	)			(5,068	)			(894	)
M&A and integration costs			(3,372	)			(11	)			(3,372	)			(1,772	)
Business combination transaction and related costs, including secondary offering costs			(2,031	)			(174	)			(2,031	)			(1,330	)
Lease abandonment			—				(4,915	)			—				(6,137	)
Lease overlap costs			—				—				—				(1,338	)
Change in fair value of contingent consideration			—				100				—				100
Income related to divestiture, net			—				459				—				877
Adjusted operating expenses		$	90,807			$	85,060			$	356,752			$	328,040

 

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CCC INTELLIGENT SOLUTIONS HOLDINGS INC. AND SUBSIDIARIES

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

(In thousands)

(Unaudited)

		Three months ended December 31,								Year ended December 31,
(dollar amounts in thousands)		2023				2022				2023				2022
Operating income (loss)		$	19,361			$	9,694			$	(23,925	)		$	51,922
Amortization of intangible assets			17,942				18,066				71,972				72,278
Amortization of acquired technologies—Cost of revenue			6,567				6,745				26,464				26,938
Stock-based compensation expense and related employer    payroll tax			40,224				28,991				147,707				111,865
Goodwill and intangible asset impairment charges			—				—				82,742				—
Plaintiff litigation costs			1,150				894				5,068				894
M&A and integration costs			3,372				11				3,372				1,772
Business combination transaction and related costs, including secondary offering costs			2,031				174				2,031				1,330
Lease abandonment			—				4,915				—				6,137
Contract termination costs			—				3,248				—				3,248
Lease overlap costs			—				—				—				1,338
Change in fair value of contingent consideration			—				(100	)			—				(100	)
Income related to divestiture, net			—				(459	)			—				(877	)
Adjusted operating income		$	90,647			$	72,179			$	315,431			$	276,745

 

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CCC INTELLIGENT SOLUTIONS HOLDINGS INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP NET INCOME (LOSS) TO ADJUSTED EBITDA

(In thousands, except for EBITDA margin percentage data)

(Unaudited)

		Three months ended December 31,								Year ended December 31,
(dollar amounts in thousands)		2023				2022				2023				2022
Net income (loss)		$	26,292			$	1,072			$	(90,071	)		$	38,406
Interest expense			16,652				13,204				63,577				38,990
Interest income			(3,806	)			(908	)			(16,252	)			(908	)
Income tax provision (benefit)			6,770				(1,258	)			5,524				11,456
Amortization of intangible assets			17,942				18,066				71,972				72,278
Amortization of acquired technologies—Cost of revenue			6,567				6,745				26,464				26,938
Depreciation and amortization related to software, equipment and property			2,046				2,327				8,577				10,161
Depreciation and amortization related to software, equipment and property—Cost of revenue			6,831				5,451				28,325				17,772
Stock-based compensation expense and related employer payroll tax			40,224				28,991				147,707				111,865
Goodwill and intangible asset impairment charges			—				—				82,742				—
Change in fair value of warrant liabilities			(30,308	)			(2,621	)			15,096				(26,073	)
Change in fair value of derivative instruments			6,306				328				5,743				(5,663	)
Income from derivative instruments			(2,016	)			—				(6,460	)			—
Plaintiff litigation costs			1,150				894				5,068				894
M&A and integration costs			3,372				11				3,372				1,772
Business combination transaction and related costs, including secondary offering costs			2,031				174				2,031				1,330
Lease abandonment			—				4,915				—				6,137
Contract termination costs			—				3,248				—				3,248
Lease overlap costs			—				—				—				1,338
Change in fair value of contingent consideration			—				(100	)			—				(100	)
Gain on sale of cost method investment			—				—				—				(3,587	)
Income related to divestiture, net			—				(459	)			—				(877	)
Adjusted EBITDA		$	100,053			$	80,080			$	353,415			$	305,377
Adjusted EBITDA Margin			44	%			39	%			41	%			39	%

 

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CCC INTELLIGENT SOLUTIONS HOLDINGS INC. AND SUBSIDIARIES

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

(In thousands, except share and per share data)

(Unaudited)

		Three months ended December 31,								Year ended December 31,
(dollar amounts in thousands)		2023				2022				2023				2022
Net income (loss)		$	26,292			$	1,072			$	(90,071	)		$	38,406
Amortization of intangible assets			17,942				18,066				71,972				72,278
Amortization of acquired technologies—Cost of revenue			6,567				6,745				26,464				26,938
Stock-based compensation expense and related employer payroll tax			40,224				28,991				147,707				111,865
Goodwill and intangible asset impairment charges			—				—				82,742				—
Change in fair value of warrant liabilities			(30,308	)			(2,621	)			15,096				(26,073	)
Change in fair value of derivative instruments			6,306				328				5,743				(5,663	)
Plaintiff litigation costs			1,150				894				5,068				894
M&A and integration costs			3,372				11				3,372				1,772
Business combination transaction and related costs, including secondary offering costs			2,031				174				2,031				1,330
Lease abandonment			—				4,915				—				6,137
Contract termination costs			—				3,248				—				3,248
Lease overlap costs			—				—				—				1,338
Change in fair value of contingent consideration			—				(100	)			—				(100	)
Income related to divestiture, net			—				(459	)			—				(877	)
Gain on sale of cost method investment			—				—				—				(3,587	)
Tax effect of adjustments			(14,584	)			(17,302	)			(59,638	)			(51,495	)
Adjusted net income		$	58,992			$	43,962			$	210,486			$	176,411
Adjusted net income per share attributable to common stockholders
Basic		$	0.10			$	0.07			$	0.34			$	0.29
Diluted		$	0.09			$	0.07			$	0.32			$	0.27
Weighted average shares outstanding
Basic			609,128,048				612,448,089				617,889,384				607,760,886
Diluted			649,260,826				643,941,176				651,587,360				642,841,596

 

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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 December 31,								Year ended December 31,
(dollar amounts in thousands)		2023				2022				2023				2022
Net cash provided by operating activities		$	86,895			$	81,469			$	250,033			$	199,907
Less: Purchases of software, equipment and property			(11,845	)			(9,107	)			(55,032	)			(47,951	)
Free Cash Flow		$	75,050			$	72,362			$	195,001			$	151,956

 

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