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| EX-99.2 - TRANSCRIPT OF CONFERENCE - Fluent, Inc. | d397325dex992.htm |
| 8-K - FORM 8-K - Fluent, Inc. | d397325d8k.htm |
Exhibit 99.1
cogint Announces 2017 First Quarter Financial Results
Strong Double-Digit Revenue Growth and Doubling of Adjusted EBITDA, Driven by
Innovation and Industry-Leading Solutions
BOCA RATON, Fla. — May 9, 2017 – Cogint, Inc. (NASDAQ: COGT), a leading provider of information and data-driven, performance marketing solutions, today reported a 29% increase in revenue over prior year to $50.8 million and net loss of $12.7 million (inclusive of a one-time write-off of long-lived assets of $3.6 million). Adjusted EBITDA increased 111% over prior year to $5.0 million.
First Quarter Financial Highlights
For the three months ended March 31, 2017, as compared to the three months ended March 31, 2016:
| • | Total revenue increased 29% over prior year to $50.8 million. |
| • | Information Services revenue increased 49% over prior year to $16.4 million. |
| • | Performance Marketing revenue increased 21% over prior year to $34.4 million. |
| • | Gross profit margin increased 300 basis points over prior year to 31%. |
| • | Net loss was $12.7 million (inclusive of a one-time write-off of long-lived assets of $3.6 million and tax benefit of $0 million) compared to $6.8 million (inclusive of tax benefit of $3.5 million). |
| • | Adjusted EBITDA increased 111% over prior year to $5.0 million. |
Recent Business Highlights
Within our Information Services segment:
| • | Continued strong client demand for our data solutions across all market verticals, leveraging our platforms with a focus on machine learning, to provide intelligence essential to client decision-making and improved ROI. |
| • | Healthcare revenue increased 85% over prior year to $2.7 million. |
| • | Financial Services revenue increased 40% over prior year to $2.6 million. |
| • | Media & Entertainment revenue increased 98% over prior year to $1.8 million. |
Within our Performance Marketing segment:
| • | Strategic growth verticals continue to show increasing demand and strong profitability, with continued focus on activation of our unique, first-party database across new channels. |
| • | Mobile App revenue increased 517% over prior year to $7.5 million. |
| • | Career & Education revenue increased 74% over prior year to $2.5 million. |
| • | Market Research revenue increased 319% over prior year to $1.4 million. |
“We delivered great results and continued strong growth in the first quarter, driven by innovative product development, adoption of industry-leading solutions across segments, and our ability to deliver efficiencies to our clients’ workflow,” stated Derek Dubner, cogint’s CEO. “We generated a near 30% increase in revenue, a 300 basis point increase in gross margin, and an over 100% increase in adjusted EBITDA. Given our product roadmap over the next several quarters, we are well positioned for 2017.”
Use of Non-GAAP Financial Measures
Management evaluates the financial performance of our business on a variety of key indicators, including adjusted EBITDA. Adjusted EBITDA is a non-GAAP financial measure equal to net loss, the most directly comparable financial measure based on US GAAP, adding back interest expense, income tax benefit, depreciation and amortization, share-based payments, write-off of long-lived assets, and other adjustments.
Conference Call
Cogint, Inc. will host a conference call on Tuesday, May 9, 2017 at 4:30 PM ET to discuss its 2017 first quarter financial and operating results. To listen to the conference call on your telephone, please dial (844) 287-6625 for domestic callers or (574) 990-1020 for international callers and use passcode: 6940266. To access the live audio webcast, visit the cogint website at www.cogint.com. Please login at least 15 minutes prior to the start of the call to ensure adequate time for any downloads that may be required. Following completion of the earnings call, a recorded replay of the webcast will be available for those unable to participate. To listen to the telephone replay, please dial (855) 859-2056 or (404) 537-3406 with the replay passcode 6940266. The replay will also be available for one week on the cogint website at www.cogint.com.
About cogint™
At cogint, we believe that time is your most valuable asset. Through powerful analytics, we transform data into intelligence, in a fast and efficient manner, so that our clients can spend their time on what matters most – running their organizations with confidence. Through leading-edge, proprietary technology and a massive data repository, our data and analytical solutions harness the power of data fusion, uncovering the relevance of disparate data points and converting them into comprehensive and insightful views of people, businesses, assets and their interrelationships. We empower clients across markets and industries to better execute all aspects of their business, from managing risk, conducting investigations, identifying fraud and abuse, and collecting debts, to identifying and acquiring new customers. At cogint, we are dedicated to making the world a safer place, to reducing the cost of doing business, and to enhancing the consumer experience.
RELATED LINKS: http://www.cogint.com
FORWARD-LOOKING STATEMENTS
This press release contains “forward-looking statements,” as that term is defined under the Private Securities Litigation Reform Act of 1995 (PSLRA), which statements may be identified by words such as “expects,” “plans,” “projects,” “will,” “may,” “anticipate,” “believes,” “should,” “intends,” “estimates,” and other words of similar meaning. Such forward looking statements are subject to risks and uncertainties that are often difficult to predict, are beyond our control and which may cause results to differ materially from expectations, including whether given our roadmap over the next several quarters, we are well positioned for 2017. Readers are cautioned not to place undue reliance on these forward-looking statements, which are based on our expectations as of the date of this press release and speak only as of the date of this press release and are advised to consider the factors listed above together with the additional factors under the heading “Forward-Looking Statements” and “Risk Factors” in the Company’s Annual Report on Form 10-K, as may be supplemented or amended by the Company’s Quarterly Reports on Form 10-Q and other SEC filings. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by law.
COGINT, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands, except share data)
(unaudited)
| March 31, 2017 | December 31, 2016 | |||||||
| ASSETS: | ||||||||
| Current assets: |
||||||||
| Cash and cash equivalents |
$ | 22,014 | $ | 10,089 | ||||
| Accounts receivable, net of allowance for doubtful accounts of $680 and $790 at March 31, 2017 and December 31, 2016, respectively |
27,951 | 30,958 | ||||||
| Prepaid expenses and other current assets |
2,389 | 2,053 | ||||||
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| Total current assets |
52,354 | 43,100 | ||||||
| Property and equipment, net |
1,391 | 1,350 | ||||||
| Intangible assets, net |
94,029 | 98,531 | ||||||
| Goodwill |
166,256 | 166,256 | ||||||
| Other non-current assets |
2,543 | 2,674 | ||||||
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| Total assets |
$ | 316,573 | $ | 311,911 | ||||
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| LIABILITIES AND SHAREHOLDERS’ EQUITY: | ||||||||
| Current liabilities: |
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| Trade accounts payable |
$ | 11,499 | $ | 14,725 | ||||
| Accrued expenses and other current liabilities |
6,467 | 6,981 | ||||||
| Deferred revenue |
1,081 | 318 | ||||||
| Current portion of long-term debt |
2,750 | 4,135 | ||||||
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| Total current liabilities |
21,797 | 26,159 | ||||||
| Promissory notes payable to certain shareholders, net |
9,971 | 10,748 | ||||||
| Long-term debt, net |
50,266 | 35,130 | ||||||
| Contingent consideration payable in stock |
10,225 | 10,225 | ||||||
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| Total liabilities |
92,259 | 82,262 | ||||||
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| Shareholders’ equity: |
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| Series A preferred stock—$0.0001 par value, 10,000,000 shares authorized; 0 share issued and outstanding at March 31, 2017 and December 31, 2016 |
— | — | ||||||
| Series B preferred stock—$0.0001 par value, 10,000,000 shares authorized; 0 share issued and outstanding at March 31, 2017 and December 31, 2016 |
— | — | ||||||
| Common stock—$0.0005 par value, 200,000,000 shares authorized; 54,440,337 and 53,717,996 shares issued at March 31, 2017 and December 31, 2016, respectively; and 54,235,306 and 53,557,761 shares outstanding at March 31, 2017 and December 31, 2016, respectively |
27 | 27 | ||||||
| Treasury stock, at cost, 205,031 and 160,235 shares at March 31, 2017 and December 31, 2016, respectively |
(699 | ) | (531 | ) | ||||
| Additional paid-in capital |
351,942 | 344,384 | ||||||
| Accumulated deficit |
(126,956 | ) | (114,231 | ) | ||||
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| Total shareholders’ equity |
224,314 | 229,649 | ||||||
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| Total liabilities and shareholders’ equity |
$ | 316,573 | $ | 311,911 | ||||
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COGINT, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(Amounts in thousands, except share data)
(unaudited)
| Three Months Ended March 31, | ||||||||
| 2017 | 2016 | |||||||
| Revenue |
$ | 50,766 | $ | 39,424 | ||||
| Cost of revenues (exclusive of depreciation and amortization) |
35,198 | 28,494 | ||||||
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| Gross profit |
15,568 | 10,930 | ||||||
| Operating expenses: |
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| Sales and marketing expenses |
4,513 | 3,126 | ||||||
| General and administrative expenses |
14,506 | 13,367 | ||||||
| Depreciation and amortization |
3,421 | 2,609 | ||||||
| Write-off of long-lived assets |
3,626 | — | ||||||
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| Total operating expenses |
26,066 | 19,102 | ||||||
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| Loss from operations |
(10,498 | ) | (8,172 | ) | ||||
| Other income (expense): |
||||||||
| Interest expense, net |
(2,227 | ) | (1,825 | ) | ||||
| Other expenses, net |
— | (297 | ) | |||||
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| Total other expense |
(2,227 | ) | (2,122 | ) | ||||
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| Loss before income taxes |
(12,725 | ) | (10,294 | ) | ||||
| Income taxes |
— | (3,522 | ) | |||||
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| Net loss |
$ | (12,725 | ) | $ | (6,772 | ) | ||
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| Loss per share: |
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| Basic and diluted |
$ | (0.24 | ) | $ | (0.25 | ) | ||
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| Weighted average number of shares outstanding: |
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| Basic and diluted |
53,811,688 | 27,468,214 | ||||||
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| Comprehensive loss: |
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| Net comprehensive loss |
$ | (12,725 | ) | $ | (6,772 | ) | ||
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COGINT, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in thousands, except share data)
(unaudited)
| Three Months Ended March 31, | ||||||||
| 2017 | 2016 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: |
||||||||
| Net loss |
$ | (12,725 | ) | $ | (6,772 | ) | ||
| Adjustments to reconcile net loss to net cash provided by operating activities: |
||||||||
| Depreciation and amortization |
3,421 | 2,609 | ||||||
| Non-cash interest expenses and related amortization |
733 | 584 | ||||||
| Share-based payments |
7,312 | 7,378 | ||||||
| Non-cash loss on exchange of warrants |
— | 297 | ||||||
| Write-off of long-lived assets |
3,626 | — | ||||||
| Provision for bad debts |
(39 | ) | (90 | ) | ||||
| Deferred income tax benefit |
— | (3,536 | ) | |||||
| Changes in assets and liabilities: |
||||||||
| Accounts receivable |
3,046 | 666 | ||||||
| Prepaid expenses and other current assets |
(336 | ) | 531 | |||||
| Other non-current assets |
131 | (833 | ) | |||||
| Trade accounts payable |
(3,226 | ) | 436 | |||||
| Accrued expenses and other current liabilities |
(514 | ) | (365 | ) | ||||
| Deferred revenue |
763 | (452 | ) | |||||
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| Net cash provided by operating activities |
2,192 | 453 | ||||||
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| CASH FLOWS FROM INVESTING ACTIVITIES: |
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| Purchase of property and equipment |
(262 | ) | (177 | ) | ||||
| Capitalized costs included in intangible assets |
(2,078 | ) | (3,037 | ) | ||||
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| Net cash used in investing activities |
(2,340 | ) | (3,214 | ) | ||||
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| CASH FLOWS FROM FINANCING ACTIVITIES: |
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| Proceeds for debt obligations, net of debt costs |
14,039 | — | ||||||
| Repayments of long-term debt |
(1,798 | ) | (563 | ) | ||||
| Taxes paid related to net share settlement of vesting of restricted stock units |
(168 | ) | — | |||||
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| Net cash provided by (used in) financing activities |
12,073 | (563 | ) | |||||
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| Net increase (decrease) in cash and cash equivalents |
$ | 11,925 | $ | (3,324 | ) | |||
| Cash and cash equivalents at beginning of period |
10,089 | 13,462 | ||||||
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| Cash and cash equivalents at end of period |
$ | 22,014 | $ | 10,138 | ||||
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| SUPPLEMENTAL DISCLOSURE INFORMATION |
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| Cash paid for interest |
$ | 1,247 | $ | 1,276 | ||||
| Cash paid for income taxes |
$ | — | $ | — | ||||
| Share-based compensation expenses capitalized in intangible assets |
$ | 246 | $ | 278 | ||||
| Issuance of common stock to a vendor for services rendered |
$ | — | $ | 131 | ||||
Use and Reconciliation of Non-GAAP Financial Measures
Management evaluates the financial performance of our business on a variety of key indicators, including adjusted EBITDA. Adjusted EBITDA is a non-GAAP financial measure equal to net loss, the most directly comparable financial measure based on US GAAP, adding back interest expense, income tax benefit, depreciation and amortization, share-based payments, write-off of long-lived assets, and other adjustments, as noted in the tables below.
| Three Months Ended March 31, | ||||||||
| (In thousands) | 2017 | 2016 | ||||||
| Net loss |
$ | (12,725 | ) | $ | (6,772 | ) | ||
| Interest expense, net |
2,227 | 1,825 | ||||||
| Income tax benefit |
— | (3,522 | ) | |||||
| Depreciation and amortization |
3,421 | 2,609 | ||||||
| Share-based payments |
7,312 | 7,378 | ||||||
| Write-off of long-lived assets |
3,626 | — | ||||||
| Non-recurring legal and litigation costs |
505 | 575 | ||||||
| Restructuring costs |
668 | — | ||||||
| Non-cash loss on exchange of warrants |
— | 297 | ||||||
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| Adjusted EBITDA |
$ | 5,034 | $ | 2,390 | ||||
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We present adjusted EBITDA as a supplemental measure of our operating performance because we believe it provides useful information to our investors as it eliminates the impact of certain items that we do not consider indicative of our cash operations and ongoing operating performance. In addition, we use it as an integral part of our internal reporting to measure the performance of our reportable segments, evaluate the performance of our senior management and measure the operating strength of our business.
Adjusted EBITDA is a measure frequently used by securities analysts, investors and other interested parties in their evaluation of the operating performance of companies similar to ours and is an indicator of the operational strength of our business. Adjusted EBITDA eliminates the uneven effect across all reportable segments of considerable amounts of non-cash depreciation and amortization, share-based payments and write-off of long-lived assets.
Adjusted EBITDA is not intended to be a performance measure that should be regarded as an alternative to, or more meaningful than, either operating income or net income as indicators of operating performance or to cash flows from operating activities as a measure of liquidity. The way we measure adjusted EBITDA may not be comparable to similarly titled measures presented by other companies, and may not be identical to corresponding measures used in our various agreements.
Contact Information:
Media and Investor Relations Contact:
Cogint, Inc.
Jordyn Kopin
Director, Investor Relations
646-356-8469
JKopin@cogint.com