SaaS Revenue Grows 17%
Year-Over-Year
Strong SaaS Metrics show upward trajectory
of Thryv software business
Thryv Holdings, Inc. (NASDAQ:THRY) (“Thryv” or the “Company”),
the provider of Thryv® software, the end-to-end client experience
platform for growing small businesses, announced financial results
for the first quarter 2021. The Company has also raised its 2021
outlook for its SaaS segment.
“Our strong Q1 performance confirms we are offering the right
solution for small businesses,” said Joe Walsh, CEO and president
of Thryv. “As a result of our execution, we are raising our SaaS
revenue guidance for 2021 and remain well-positioned to capitalize
on the market opportunity.”
Today, we announced the release of our ThryvPaySM mobile app.
This easy to use mobile payment app is ideally suited to the needs
of service-based businesses and is now available at no monthly
charge. It also offers added convenience for our Thryv platform
subscribers. We are pleased to offer this app free of charge for
small businesses and provide the option for frictionless upgrades
to the full Thryv platform when the time is right.”
First Quarter 2021 Financial Highlights (1):
- U.S. SaaS revenue was $37.3 million, a 17% increase
year-over-year
- U.S. Marketing Services revenue was $227.9 million
- Thryv International Marketing Services revenue was $15.4
million
- Consolidated total revenue was $280.6 million
- Consolidated net income was $36.5 million
- Consolidated adjusted EBITDA was $104.9 million, representing
an adjusted EBITDA margin of 37.4%
- Consolidated gross profit was $182.4 million
- Consolidated adjusted gross profit was $193.8 million
(1) Consolidated results include Sensis
results subsequent to the March 1, 2021 acquisition date.
Additional US Business Highlights
- SaaS ARPU increased to $304 for the first quarter of 2021,
compared to $240 in the first quarter of 2020
- Total SaaS clients increased sequentially to 44.5 thousand for
the first quarter of 2021
- SaaS monthly churn was 2.5% for the first quarter of 2021,
compared to 3.4% in the first quarter of 2020
- Net Dollar Retention improved 16 percentage points to 89% at
end of the first quarter of 2021, when compared to the first
quarter of 2020
- SaaS active users and usage frequency reached new all-time high
as daily and weekly active users increased 44% year-over-year
- SaaS average time-in-app reaches new all-time high and
increases 103% year-over-year
- On March 1st, the Company acquired Sensis Holdings, the leading
Australian marketing services company
Outlook:
The Company is updating guidance for fiscal year 2021 as
indicated below.
- U.S. SaaS revenue guidance range raised to $151 – $153 million,
up from the previously announced $140 - $145 million
- U.S. Marketing Services revenue range maintained at $740 - $760
million
- Thryv International, which reflects the acquisition of Sensis
Holdings, expects revenue in the range of AUD $180 to $200 million
for the 10 months of 2021 ownership (Sensis Holdings acquired March
1, 2021)
Please note: All GAAP financials now include Sensis for the
month of March 2021 only.
These statements are forward-looking and actual results may
materially differ. Refer to the “Forward-Looking Statements”
section below for information on the factors that could cause our
actual results to materially differ from these forward-looking
statements.
Earnings Conference Call Information
Thryv will host a conference call on Thursday, May 13, 2021 at
8:30 a.m. (Eastern Time) to discuss the Company's first quarter
2021 results. The conference call will be available via the
Internet at www.thryv.com. There will be several slides
accompanying the webcast. Please go to the website at least 15
minutes prior to the call to register, download and install any
necessary software. The recorded webcast will also be available on
the Company's website.
If you are unable to participate in the conference call, a
replay will be available. To access the replay, please dial (800)
585-8367 or (416) 621-4642 and enter "7068595."
Final Results
Thryv Holdings, Inc. and
Subsidiaries
Condensed Consolidated
Statements of Operations
(in thousands, except share
and per share data)
(unaudited)
Three Months Ended March
31,
2021
2020
Revenue
$
280,606
$
318,570
Cost of services
98,160
117,976
Gross profit
182,446
200,594
Operating expenses:
Sales and marketing
76,540
89,292
General and administrative
41,279
49,562
Impairment charges
—
98
Total operating expenses
117,819
138,952
Operating income
64,627
61,642
Other income (expense):
Interest expense
(11,607
)
(14,780
)
Interest expense, related party
(4,065
)
(5,150
)
Other components of net periodic pension
cost
453
(201
)
Other expense
(1,093
)
—
Income before (provision) for income
taxes
48,315
41,511
(Provision) for income taxes
(11,809
)
(13,409
)
Net income
$
36,506
$
28,102
Net income per common share:
Basic
$
1.10
$
0.86
Diluted
$
1.07
$
0.80
Weighted-average shares used in
computing basic and diluted net income per common share:
Basic
33,108,422
32,578,286
Diluted
34,013,480
35,026,526
Thryv Holdings, Inc. and
Subsidiaries
Condensed Consolidated Balance
Sheets
(in thousands, except share
data)
(unaudited)
March 31, 2021
December 31, 2020
Assets
Current assets
Cash and cash equivalents
$
29,841
$
2,406
Accounts receivable, net of allowance of
$34,557 and $33,030
354,737
296,570
Contract assets, net of allowance of $244
and $338
9,285
10,975
Taxes receivable
9,154
9,229
Prepaid expenses and other current
assets
36,277
26,172
Indemnification asset
24,346
24,346
Total current assets
463,640
369,698
Fixed assets and capitalized software,
net
123,281
89,044
Goodwill
679,559
609,457
Intangible assets, net
145,647
31,777
Deferred tax assets
97,941
93,099
Other assets
34,410
21,902
Total assets
$
1,544,478
$
1,214,977
Liabilities and Stockholders'
Equity
Current liabilities
Accounts payable
$
19,981
$
8,927
Accrued liabilities
157,537
139,613
Current portion of unrecognized tax
benefits
30,417
30,022
Contract liabilities
47,909
18,942
New Term Loan, current
70,000
—
Other current liabilities
20,324
9,896
Total current liabilities
346,168
207,400
New Term Loan, net
372,454
—
New Term Loan, related party
234,098
—
Senior Term Loan, net
—
335,683
Senior Term Loan, related party
—
113,482
ABL Facility
43,682
79,238
Leaseback obligations
54,585
54,798
Pension obligations, net
184,642
190,827
Deferred tax liabilities
30,706
508
Other liabilities
48,947
36,266
Total long-term liabilities
969,114
810,802
Commitments and contingencies
Stockholders' equity
Common stock - $0.01 par value,
250,000,000 shares authorized; 59,806,077, shares issued and
33,127,667 shares outstanding at March 31, 2021; and 59,590,422
shares issued and 32,912,012 shares outstanding at December 31,
2020
598
596
Additional paid-in capital
1,058,504
1,059,624
Treasury stock - 26,678,410 shares at
March 31, 2021 and December 31, 2020
(468,613
)
(468,613
)
Accumulated other comprehensive income
(loss)
(2,967
)
—
Accumulated deficit
(358,326
)
(394,832
)
Total stockholders' equity
229,196
196,775
Total liabilities and stockholders'
equity
$
1,544,478
$
1,214,977
Thryv Holdings, Inc. and
Subsidiaries
Condensed Consolidated
Statements of Cash Flows
(in thousands)
(unaudited)
Three Months Ended March
31,
2021
2020
Cash Flows from Operating
Activities
Net income
$
36,506
$
28,102
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization
19,718
37,823
Amortization of debt issuance costs
433
267
Deferred income taxes
(13,249
)
(15,911
)
Provision for credit losses
2,018
10,588
Provision for service credits
4,528
6,736
Stock-based compensation expense
(benefit)
1,971
(6,064
)
Other components of net periodic pension
cost
(453
)
201
Loss on early extinguishment of debt
299
—
Loss on disposal/write-off of fixed assets
and capitalized software
15
2,962
Impairment charges
—
98
Non-cash loss from remeasurement of
indemnification asset
—
3,801
Gain (loss) on foreign currency exchange
rates
835
—
Other, net
6
—
Changes in working capital items,
excluding acquisitions:
Accounts receivable
26,846
(8,921
)
Contract assets
1,446
(522
)
Prepaid expenses and other assets
(10,998
)
(4,583
)
Accounts payable and accrued
liabilities
(67,458
)
(33,981
)
Accrued income taxes, net
9,597
30,351
Operating lease liability
(403
)
(2,620
)
Contract liabilities
2,547
(2,685
)
Net cash provided by operating
activities
14,204
45,642
Cash Flows from Investing
Activities
Additions to fixed assets and capitalized
software
(3,668
)
(9,122
)
Proceeds from the sale of building and
fixed assets
—
1,502
Acquisition of a business, net of cash
acquired
(174,190
)
—
Net cash (used in) investing
activities
(177,858
)
(7,620
)
Cash Flows from Financing
Activities
Proceeds from New Term Loan
418,070
—
Proceeds from New Term Loan, related
party
260,930
—
Payments of Senior Term Loan
(335,821
)
(23,445
)
Payments of Senior Term Loan, related
party
(113,789
)
(10,555
)
Proceeds from ABL Facility
249,936
329,719
Payments of ABL Facility
(285,492
)
(312,624
)
Purchase of treasury stock
—
(21,770
)
Other
(2,038
)
(56
)
Net cash provided by (used in) financing
activities
191,796
(38,731
)
Effect of exchange rate changes on cash
and cash equivalents
(707
)
—
Increase (decrease) in cash and cash
equivalents
27,435
(709
)
Cash and cash equivalents, beginning of
period
2,406
1,912
Cash and cash equivalents, end of
period
$
29,841
$
1,203
Supplemental Information
Cash paid for interest
$
17,286
$
20,802
Cash paid (received) for income taxes,
net
$
15,753
$
(1,031
)
Three Months Ended March 31,
2021
Marketing Services
SaaS
Thryv International
Total
Revenue
$
227,933
$
37,251
$
15,422
$
280,606
Segment EBITDA
98,631
316
5,986
104,933
Non-GAAP Measures
Our results included in this press release include Adjusted
EBITDA and Adjusted Gross Profit, which are not presented in
accordance with U.S. generally accepted accounting principles
(“GAAP”). These non-GAAP measures are presented for supplemental
informational purposes only and are not intended to be considered
in isolation or as a substitute for, or superior to, financial
information prepared and presented in accordance with GAAP. Please
refer to the supplemental information presented in the tables below
for a reconciliation of Adjusted EBITDA to Net income, and Adjusted
Gross Profit to gross profit. Both Net income and Gross profit are
the most comparable GAAP financial measure to Adjusted EBITDA and
Adjusted Gross Profit, respectively.
We believe that these non-GAAP financial measures provide useful
information about our financial performance, enhance the overall
understanding of our past performance and future prospects and
allow for greater transparency with respect to important metrics
used by our management for financial and operational
decision-making. We believe that these measures provide an
additional tool for investors to use in comparing our core
financial performance over multiple periods with other companies in
our industry. However, it is important to note that the particular
items we exclude from, or include in, our non-GAAP financial
measures may differ from the items excluded from, or included in,
similar non-GAAP financial measures used by other companies in the
same industry.
The following is a reconciliation of Adjusted EBITDA to its most
directly comparable GAAP measure, Net income (in thousands):
Three Months Ended March
31,
2021
2020
Reconciliation of Adjusted
EBITDA
Net income
$
36,506
$
28,102
Interest expense
15,672
19,930
Provision for income taxes
11,809
13,409
Depreciation and amortization expense
19,718
37,823
Loss on early extinguishment of debt
299
—
Restructuring and integration expenses
(1)
9,234
9,845
Transaction costs (2)
10,546
6,534
Stock-based compensation expense (benefit)
(3)
1,971
(6,064
)
Other components of net periodic pension
(benefit) cost (4)
(453
)
201
Non-cash loss from remeasurement of
indemnification asset (5)
—
3,801
Impairment charges
—
98
Other (6)
(369
)
(900
)
Adjusted EBITDA
$
104,933
$
112,779
(1)
For the three months ended March 31, 2021
and 2020, expenses relate to periodic efforts to enhance
efficiencies and reduce costs, and include severance benefits, loss
on disposal of fixed assets and capitalized software, and costs
associated with abandoned facilities and system consolidation.
(2)
Expenses related to the Company's direct
listing, Sensis acquisition and other transaction costs.
(3)
Company records stock-based compensation
expense related to the amortization of grant date fair value of the
Company’s stock-based compensation awards. Additionally,
stock-based compensation expense includes the remeasurement of
these awards at each period end.
(4)
Other components of net periodic pension
cost is from our non-contributory defined benefit pension plans
that are currently frozen and incur no additional service costs.
The most significant component of other components of net periodic
pension cost relates to the mark to market pension
remeasurement.
(5)
In connection with the YP Acquisition, the
seller provided the Company indemnity for future potential losses
associated with certain federal and state tax positions taken in
tax returns filed by the seller prior to the Acquisition Date.
(6)
Other primarily includes expenses related
to potential non income-based tax liabilities. Additionally, during
the three months ended March 31, 2021, other includes foreign
exchange related expense of $0.8 million.
The following is a reconciliation of Adjusted Gross Profit, to
its most directly comparable GAAP measure, Gross profit (in
thousands):
Three Months Ended March
31,
2021
2020
Reconciliation of Adjusted Gross
Profit
Gross profit
$
182,446
$
200,594
Plus:
Depreciation and amortization expense
11,244
18,355
Stock-based compensation expense
(benefit)
81
(316
)
Adjusted Gross Profit
$
193,771
$
218,633
Forward-Looking Statements
Some statements included in this release constitute
forward-looking statements. Statements that include the words
“may”, “will”, “could”, “should”, “would”, “believe”, “anticipate”,
“forecast”, “estimate”, “expect”, “preliminary”, “intend”, “plan”,
“project”, “outlook”, “future”, “forward”, “guidance” and similar
statements of a future or forward-looking nature identify
forward-looking statements. These statements are not guarantees of
future performance. Forward-looking statements provide current
expectations with respect to our financial performance and future
events with respect to our business and industry in general.
Forward-looking statements are based on certain assumptions and
include any statement that does not directly relate to any
historical or current fact. Accordingly, there are or will be
important factors that could cause our actual results to differ
materially from those indicated in these statements. We believe
that these factors include, but are not limited to, the risks
related to the following: risks related to the ongoing COVID-19
pandemic, the Company’s ability to maintain adequate liquidity to
fund operations; the Company’s future operating and financial
performance; the Company’s ability to consummate acquisitions, or,
if consummated, to successfully integrate acquired businesses into
the Company’s operations, the Company’s ability to recognize the
benefits of acquisitions, or the failure of an acquired company to
achieve its plans and objectives; limitations on our operating and
strategic flexibility and the ability to operate our business,
finance our capital needs or expand business strategies under the
terms of our credit facilities; our ability to retain existing
business and obtain and retain new business; general economic or
business conditions affecting the markets we serve; declining use
of print yellow page directories by consumers; our ability to
collect trade receivables from clients to whom we extend credit;
credit risk associated with our reliance on small and medium sized
businesses as clients; our ability to attract and retain key
managers; increased competition in our markets; our ability to
obtain future financing due to changes in the lending markets or
our financial position; our ability to maintain agreements with
major Internet search and local media companies; reduced
advertising spending and increased contract cancellations by our
clients, which causes reduced revenue; and our ability to
anticipate or respond effectively to changes in technology and
consumer preferences. All subsequent written and oral
forward-looking statements attributable to us or persons acting on
our behalf are expressly qualified in their entirety by such
cautionary statements.
If one or more events related to these or other risks or
uncertainties materialize, or if our underlying assumptions prove
to be incorrect, actual results may differ materially from what we
anticipate. For these reasons, we caution you against relying on
forward-looking statements. All forward-looking statements included
in this press release are expressly qualified in their entirety by
the foregoing cautionary statements. These forward-looking
statements speak only as of the date hereof and, other than as
required by law, we undertake no obligation to publicly update or
revise any forward-looking statements, whether as a result of new
information, future events or otherwise.
About Thryv Holdings, Inc.
Thryv Holdings, Inc. owns the easy-to-use Thryv® end-to-end
customer experience software built for growing small to medium
sized businesses (SMBs) that helps over 40,000 SaaS clients with
the daily demands of running a business. With Thryv®, SMBs can get
the job, manage the job and get credit. Thryv’s award-winning
platform provides modernized business functions, allowing SMBs to
reach more customers, stay organized, get paid faster and generate
reviews. These functions include building a digital customer
database, automated marketing through email and text, updating
business listings across the internet, scheduling online
appointments, sending notifications and reminders, managing ratings
and reviews, generating estimates and invoices, and processing
payments.
Thryv supports franchise operators and multi-location business
owners with Hub by Thryv™, a software console that enables
businesses managers to oversee their operations using the Thryv®
software.
Thryv also connects local businesses to consumer services
through our search, display and social media management products,
our print directories featuring The Real Yellow Pages® tagline, and
our local search portals, which operate under the DexKnows.com®,
Superpages.com® and Yellowpages.com URLs and reach some 35 million
monthly visitors. For more information about the company, visit
thryv.com.
Thryv delivers business services to more than 400,000 SMBs
worldwide that enable these SMBs to compete and win in today’s
economy.
On March 1, 2021, Thryv announced it closed the acquisition of
Sensis, Australia’s leading digital, marketing and directory
services provider, which helps Australians connect and engage
through its leading platforms, digital consumer businesses (Yellow,
White Pages, True Local and Whereis), search engine marketing and
optimization services, website products, social, data and mapping
solutions, and through its digital agency Found. Sensis is also
Australia’s largest print directory publisher including the Yellow
and White Pages.
Headquartered in Melbourne, Sensis has a sales presence in all
states and territories across Australia.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210513005308/en/
Media Contact: Paige Blankenship Thryv, Inc. 972.453.3012
paige.blankenship@thryv.com
Will Clarke Sensis +61 (0) 488 345 464
Will.clarke@sensis.com.au
Investor Contacts: Cameron Lessard Thryv, Inc.
214.773.7022 cameron.lessard@thryv.com
KJ Christopher Thryv, Inc. 972.453.7068
kj.christopher@thryv.com
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