Q4-FY24 GAAP subscription revenue of $134.4 million above the high end of guidance
Strong cash generation in Q4-FY24 and full year FY24
E2open Parent Holdings, Inc. (NYSE: ETWO) (“e2open” or the “Company”), the connected supply chain SaaS platform with the largest multi-enterprise network, today announced financial results for its fiscal fourth quarter and full year ended February 29, 2024.
“During the fiscal fourth quarter, e2open continued to execute our plan to re-accelerate organic growth by refocusing all aspects of the company’s operations and culture around a client-centric mindset,” said Andrew Appel, e2open chief executive officer. “We are making clear progress and are very encouraged by the emerging positive momentum we see in key areas – including improved in-quarter win rates. During the fourth quarter, we closed several large, strategically important subscription software deals with new and existing clients across multiple product families. These wins highlight the strong market position of e2open’s unique software portfolio that combines best-in-class applications and supply chain expertise with the industry’s largest network of connected partners. We are honored that the world’s leading companies continue to trust e2open to lead mission-critical supply chain projects and deliver unmatched operational impact.”
“In Q4-FY24, e2open delivered subscription revenue and total revenue above the high end of our guidance,” said Marje Armstrong, chief financial officer of e2open. “During the quarter and for the full fiscal year 2024, strong performance on adjusted EBITDA margins and cash flow once again highlighted the resilience of our underlying business and the distinctive value that we provide to our many customers and partners. Moving into FY25, our entire organization is aligned around our goals of delighting our clients and repositioning e2open for robust and sustainable organic growth.”
Fiscal Fourth Quarter 2024 Financial Highlights
-
Revenue
- GAAP subscription revenue for the fourth quarter of 2024 was $134.4 million, a decrease of 1.8% from the year-ago comparable period and 84.8% of total revenue. Subscription revenue decreased 2.4% on a constant currency basis.
- Total GAAP revenue for the fourth quarter of 2024 was $158.5 million, a decrease of 4.7% from the year-ago comparable period. Total revenue decreased 5.3% on a constant currency basis.
- GAAP gross profit for the fourth quarter of 2024 was $80.5 million, a decrease of 7.5% from the year-ago comparable period. Non-GAAP gross profit was $110.9 million, down 4.9% and 5.7% on a constant currency basis.
- GAAP gross margin for the fourth quarter of 2024 was 50.8% compared to 52.3% from the year-ago comparable period. Non-GAAP gross margin was 70.0% on an organic basis and 69.9% on a constant currency basis compared to 70.2% from the comparable year-ago period.
- GAAP Net loss for the fourth quarter of 2024 was $45.5 million compared to $303.5 million from the year-ago comparable period. Adjusted EBITDA for the fourth quarter of 2024 was $55.1 million, a decrease of 10.0% and 11.3% on a constant currency basis from the year-ago comparable period. Adjusted EBITDA margin was 34.8% and 34.5% on a constant currency basis versus 36.8% from the comparable year-ago period.
- GAAP EPS for the fourth quarter of 2024 was a loss of $0.14. Adjusted EPS for the fourth quarter of 2024 was $0.05.
Fiscal Year 2024 Financial Highlights
-
Revenue
- GAAP subscription revenue for fiscal 2024 was $536.8 million, an increase of 0.7% compared to the prior fiscal year and 84.6% of total revenue. Subscription revenue increased 0.4% on a constant currency basis.
- Total GAAP revenue for fiscal 2024 was $634.6 million, a decrease of 2.7% compared to the prior fiscal year. Total revenue decreased 3.1% on a constant currency basis.
- GAAP gross profit for fiscal 2024 was $317.7 million, a decrease of 3.8% compared to the prior fiscal year. Non-GAAP gross profit was $440.5 million, down 1.7% and 2.2% on a constant currency basis.
- GAAP gross margin for fiscal 2024 was 50.1% compared to 50.6% in the prior fiscal year. Non-GAAP gross margin was 69.4% on an organic and a constant currency basis compared to 68.7% in the prior fiscal year.
- GAAP Net loss for fiscal 2024 was $1,185.1 million compared to $720.2 million in the prior fiscal year. Adjusted EBITDA for fiscal 2024 was $220.3 million, an increase of 1.5% and 0.6% on a constant currency basis compared to the prior fiscal year. Adjusted EBITDA margin was 34.7% and 34.5% on a constant currency basis versus 33.3% in the prior fiscal year.
- GAAP EPS for fiscal 2024 was a loss of $3.52. Adjusted EPS for fiscal 2024 was $0.19.
-
Cash flow
- GAAP operating cash flow for fiscal 2024 was $84.9 million compared to $68.1 million, or growth of 24.6%, from the year-ago comparable period, inclusive of non-recurring expenses.
- Adjusted operating cash flow for fiscal 2024, exclusive of non-recurring expenses, was $116.0 million. This compares to $104.8 million from the year ago comparable period and represents 52.6% of fiscal 2024 adjusted EBITDA.
Recent Business Highlights
- Named a Leader in the 2024 Gartner® Magic Quadrant™ for Transportation Management Systems for the second consecutive year. This distinction highlights the ability of e2open’s cloud-based, multi-tenant TMS solution to provide clients with a seamless interface across transportation modes and built-in access to expansive carrier networks.
- Named a Leader in the IDC MarketScape: Worldwide Multi-Enterprise Supply Chain Commerce Network 2023 Vendor Assessment for the third consecutive year. This important recognition differentiates e2open for its comprehensive partner network, accessible integration strategy, data-based architecture, and scalability.
- Closed a new project in the fourth quarter with Sonos, Inc., an American audio equipment manufacturer. This client looks to ensure supply availability, control excess liabilities, and boost productivity through several key aspects, including improving component materials availability, awareness, and collaboration for better control over component inventory, and increased productivity in materials planning.
- Selected by a large consumer goods superstore chain to provide e2open’s Transportation Management and Logistics as a Service (LaaS) solutions. By working with e2open, this new logo retail client will be able to drive efficiencies and cost savings resulting from improved supply chain visibility, optimized store service levels, and transport load consolidation.
- Closed a new project in the fourth quarter with Rawlings Sporting Goods, a leading manufacturer and marketer of sporting goods based in the United States. With this project, the client will be enabled to better control spend and improve visibility and reporting analytics.
- Launched new product, Supply Network Discovery, at annual Connect European Summit customer conference in Amsterdam. The sold-out event with double the attendance year over year included dozens of educational sessions covering e2open’s technology platform across channel, planning, global trade, logistics and supply, along with client-led sessions.
- Expanded world-class network with a 16% increase in connected enterprises and 14% increase in transactions processed versus last year, which empowers e2open clients to benefit from greater efficiency, cost-saving opportunities, optimized operations, and further digital maturity in their supply chains.
Financial Outlook for Fiscal Year 2025
As of April 29, 2024, e2open is providing guidance for fiscal year 2025, which ends February 28, 2025, as follows:
Fiscal 2025 Subscription GAAP Revenue
- GAAP subscription revenue for fiscal 2025 is expected to be in the range of $532 million to $542 million, reflecting flat growth year over year at the mid-point.
Fiscal 2025 Total GAAP Revenue
- Total GAAP revenue for fiscal 2025 is expected to be in the range of $630 million to $645 million, reflecting a 0.5% organic growth rate at the mid-point.
Fiscal First Quarter 2025 GAAP Subscription Revenue
- GAAP subscription revenue for the fiscal first quarter of 2025 is expected to be in the range of $130 million to $133 million, reflecting a negative 2.5% organic growth rate at the mid-point.
Fiscal 2025 Non-GAAP Gross Profit Margin
- Non-GAAP gross profit margin for fiscal 2025 is expected to be in the range of 68% to 70%.
Fiscal 2025 Adjusted EBITDA
- Adjusted EBITDA for fiscal 2025 is expected to be in the range of $215 million to $225 million, reflecting an implied adjusted EBITDA margin in the range of 34% to 35%.
NOTE: E2open is unable to quantify certain amounts that would be required to be included in the most directly comparable GAAP financial measures for non-GAAP gross profit margin or adjusted EBITDA without unreasonable effort, and therefore no reconciliation of certain forward-looking non-GAAP financial measures for non-GAAP gross profit margin or adjusted EBITDA is included.
Quarterly Conference Call
E2open will host a conference call today at 5:00 p.m. ET to review fiscal fourth quarter and full fiscal year 2024 financial results, in addition to discussing the Company’s outlook for the full fiscal year 2025. To access this call, dial 888-506-0062 (domestic) or 973-528-0011 (international). The conference ID is 909798. A live webcast of the conference call will be accessible in the “Investor Relations” section of e2open’s website at www.e2open.com. A replay of this conference call can also be accessed through January 23, 2024, at 877-481-4010 (domestic) or 919-882-2331 (international). The replay passcode is 50219. An archived webcast of this conference call will also be available after the completion of the call in the “Investor Relations” section of the Company’s website at www.e2open.com.
About e2open
E2open is the connected supply chain software platform that enables the world’s largest companies to transform the way they make, move, and sell goods and services. With the broadest cloud-native global platform purpose-built for modern supply chains, e2open connects more than 480,000 manufacturing, logistics, channel, and distribution partners as one multi-enterprise network tracking over 16 billion transactions annually. Our SaaS platform anticipates disruptions and opportunities to help companies improve efficiency, reduce waste, and operate sustainably. Moving as one.™ Learn More: www.e2open.com.
E2open and “Moving as one.” are the registered trademarks of E2open, LLC. All other trademarks, registered trademarks and service marks are the property of their respective owners.
Non-GAAP Financial Measures
This press release includes certain financial measures not presented in accordance with generally accepted accounting principles (“GAAP”) including non-GAAP revenue, non-GAAP subscription revenue, non-GAAP professional services and other revenue, adjusted EBITDA, adjusted EBITDA margin, non-GAAP gross profit, non-GAAP net income, non-GAAP gross margin, adjusted free cash flow and adjusted earnings per share. These non-GAAP financial measures are not a measure 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 net income, cash flows from operations or other measures of profitability, liquidity, or performance under GAAP. You should be aware that the Company’s presentation of these measures may not be comparable to similarly titled measures used by other companies.
The Company believes this non-GAAP measure of financial results provides 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 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.
Safe Harbor Statement
Certain statements in this press release are "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and are subject to the safe harbor created thereby. These statements relate to future events or the Company's future financial performance and involve known and unknown risks, uncertainties and other factors that may cause the actual results, levels of activity, performance or achievements of the Company or its industry to be materially different from those expressed or implied by any forward-looking statements. In particular, statements about the Company's expectations, beliefs, plans, objectives, assumptions, future events or future performance contained in this press release are forward-looking statements. In some cases, forward-looking statements can be identified by terminology such as "may," "will," "could," "would," "should," "expect," "plan," "anticipate," "intend," "believe," "estimate," "predict," "potential," "outlook," "guidance" or the negative of those terms or other comparable terminology.
Please see the Company's documents filed or to be filed with the Securities and Exchange Commission, including the annual report filed on Form 10-K, and any amendments thereto for a discussion of certain important risk factors that relate to forward-looking statements contained in this press release. The Company has based these forward-looking statements on its current expectations, assumptions, estimates and projections. While the Company believes these expectations, assumptions, estimates, and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond the Company's control. These and other important factors may cause actual results, performance or achievements to differ materially from those expressed or implied by these forward-looking statements. Any forward-looking statements are made only as of the date hereof, and unless otherwise required by applicable securities laws, the Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
E2OPEN PARENT HOLDINGS, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS FISCAL YEAR 2024 |
||||||||
Fiscal Year Ended |
||||||||
(In thousands, except per share amounts) |
February 29, 2024 |
February 28, 2023 |
||||||
|
|
(Unaudited) |
|
|
||||
Revenue |
||||||||
Subscriptions |
$ |
536,792 |
|
$ |
532,940 |
|
||
Professional services and other |
|
97,762 |
|
|
119,275 |
|
||
Total revenue |
|
634,554 |
|
|
652,215 |
|
||
Cost of Revenue |
||||||||
Subscriptions |
|
146,006 |
|
|
140,462 |
|
||
Professional services and other |
|
72,249 |
|
|
82,939 |
|
||
Amortization of acquired intangible assets |
|
98,608 |
|
|
98,531 |
|
||
Total cost of revenue |
|
316,863 |
|
|
321,932 |
|
||
Gross Profit |
|
317,691 |
|
|
330,283 |
|
||
Operating Expenses |
||||||||
Research and development |
|
101,420 |
|
|
97,982 |
|
||
Sales and marketing |
|
87,734 |
|
|
87,960 |
|
||
General and administrative |
|
108,048 |
|
|
88,070 |
|
||
Acquisition-related expenses |
|
2,080 |
|
|
16,297 |
|
||
Amortization of acquired intangible assets |
|
80,276 |
|
|
82,812 |
|
||
Goodwill impairment |
|
1,097,741 |
|
|
901,566 |
|
||
Intangible asset impairment |
|
34,000 |
|
|
— |
|
||
Total operating expenses |
|
1,511,299 |
|
|
1,274,687 |
|
||
Loss from operations |
|
(1,193,608 |
) |
|
(944,404 |
) |
||
Other income (expense) |
||||||||
Interest and other expense, net |
|
(102,460 |
) |
|
(76,831 |
) |
||
(Loss) gain from change in tax receivable agreement liability |
|
2,190 |
|
|
(2,886 |
) |
||
(Loss) gain from change in fair value of warrant liability |
|
14,903 |
|
|
37,523 |
|
||
(Loss) gain from change in fair value of contingent consideration |
|
11,520 |
|
|
16,020 |
|
||
Total other expense |
|
(73,847 |
) |
|
(26,174 |
) |
||
Loss before income tax provision |
|
(1,267,455 |
) |
|
(970,578 |
) |
||
Income tax benefit |
|
82,376 |
|
|
250,376 |
|
||
Net loss |
|
(1,185,079 |
) |
|
(720,202 |
) |
||
Less: Net loss attributable to noncontrolling interest |
|
(115,055 |
) |
|
(71,499 |
) |
||
Net loss attributable to E2open Parent Holdings, Inc. |
$ |
(1,070,024 |
) |
$ |
(648,703 |
) |
||
|
||||||||
Weighted-average common shares outstanding: |
||||||||
Basic |
|
303,751 |
|
|
301,946 |
|
||
Diluted |
|
303,751 |
|
|
301,946 |
|
||
Net loss attributable to E2open Parent Holdings, Inc. common shareholders per share: |
||||||||
Basic |
$ |
(3.52 |
) |
$ |
(2.15 |
) |
||
Diluted |
$ |
(3.52 |
) |
$ |
(2.15 |
) |
||
E2OPEN PARENT HOLDINGS, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS FISCAL FOURTH QUARTER 2024 (Unaudited) |
||||||||
Three Months Ended |
||||||||
(In thousands, except per share amounts) |
February 29, 2024 |
February 28, 2023 |
||||||
Revenue |
||||||||
Subscriptions |
$ |
134,355 |
|
$ |
136,888 |
|
||
Professional services and other |
|
24,094 |
|
|
29,377 |
|
||
Total revenue |
|
158,449 |
|
|
166,265 |
|
||
Cost of Revenue |
||||||||
Subscriptions |
|
35,993 |
|
|
35,095 |
|
||
Professional services and other |
|
17,235 |
|
|
19,493 |
|
||
Amortization of acquired intangible assets |
|
24,690 |
|
|
24,662 |
|
||
Total cost of revenue |
|
77,918 |
|
|
79,250 |
|
||
Gross Profit |
|
80,531 |
|
|
87,015 |
|
||
Operating Expenses |
||||||||
Research and development |
|
25,672 |
|
|
24,894 |
|
||
Sales and marketing |
|
24,042 |
|
|
20,612 |
|
||
General and administrative |
|
22,634 |
|
|
21,296 |
|
||
Acquisition-related expenses |
|
1,664 |
|
|
1,984 |
|
||
Amortization of acquired intangible assets |
|
20,141 |
|
|
20,289 |
|
||
Goodwill impairment |
|
— |
|
|
386,750 |
|
||
Intangible asset impairment |
|
— |
|
|
— |
|
||
Total operating expenses |
|
94,153 |
|
|
475,825 |
|
||
Loss from operations |
|
(13,622 |
) |
|
(388,810 |
) |
||
Other income (expense) |
||||||||
Interest and other expense, net |
|
(26,574 |
) |
|
(22,099 |
) |
||
(Loss) gain from change in tax receivable agreement liability |
|
(6,165 |
) |
|
(11,975 |
) |
||
(Loss) gain from change in fair value of warrant liability |
|
(3,883 |
) |
|
759 |
|
||
(Loss) gain from change in fair value of contingent consideration |
|
(3,840 |
) |
|
(1,740 |
) |
||
Total other expense |
|
(40,462 |
) |
|
(35,055 |
) |
||
Loss before income tax provision |
|
(54,084 |
) |
|
(423,865 |
) |
||
Income tax benefit |
|
8,549 |
|
|
120,366 |
|
||
Net loss |
|
(45,535 |
) |
|
(303,499 |
) |
||
Less: Net loss attributable to noncontrolling interest |
|
(3,334 |
) |
|
(30,035 |
) |
||
Net loss attributable to E2open Parent Holdings, Inc. |
$ |
(42,201 |
) |
$ |
(273,464 |
) |
||
|
||||||||
Weighted-average common shares outstanding: |
||||||||
Basic |
|
305,454 |
|
|
302,322 |
|
||
Diluted |
|
305,454 |
|
|
302,322 |
|
||
Net loss attributable to E2open Parent Holdings, Inc. common
|
||||||||
Basic |
$ |
(0.14 |
) |
$ |
(0.90 |
) |
||
Diluted |
$ |
(0.14 |
) |
$ |
(0.90 |
) |
||
E2OPEN PARENT HOLDINGS, INC. CONDENSED CONSOLIDATED BALANCE SHEETS |
||||||||
(In thousands) |
February 29, 2024 |
|
February 28, 2023 |
|||||
|
|
(Unaudited) |
|
|
||||
Assets |
||||||||
Cash and cash equivalents |
$ |
134,478 |
|
$ |
93,032 |
|
||
Restricted cash |
|
14,560 |
|
|
11,310 |
|
||
Accounts receivable, net |
|
161,556 |
|
|
174,809 |
|
||
Prepaid expenses and other current assets |
|
28,843 |
|
|
25,200 |
|
||
Total current assets |
|
339,437 |
|
|
304,351 |
|
||
Goodwill |
|
1,843,477 |
|
|
2,927,807 |
|
||
Intangible assets, net |
|
841,031 |
|
|
1,051,124 |
|
||
Property and equipment, net |
|
67,177 |
|
|
72,476 |
|
||
Operating lease right-of-use assets |
|
21,299 |
|
|
18,758 |
|
||
Other noncurrent assets |
|
29,234 |
|
|
25,659 |
|
||
Total assets |
$ |
3,141,655 |
|
$ |
4,400,175 |
|
||
Liabilities and Stockholders' Equity |
||||||||
Accounts payable and accrued liabilities |
$ |
90,594 |
|
$ |
97,491 |
|
||
Channel client deposits payable |
|
14,560 |
|
|
11,310 |
|
||
Deferred revenue |
|
213,138 |
|
|
203,824 |
|
||
Current portion of notes payable |
|
11,272 |
|
|
11,144 |
|
||
Current portion of operating lease obligations |
|
7,378 |
|
|
7,622 |
|
||
Current portion of financing lease obligations |
|
1,448 |
|
|
2,582 |
|
||
Income taxes payable |
|
584 |
|
|
2,190 |
|
||
Total current liabilities |
|
338,974 |
|
|
336,163 |
|
||
Long-term deferred revenue |
|
2,077 |
|
|
2,507 |
|
||
Operating lease obligations |
|
17,372 |
|
|
15,379 |
|
||
Financing lease obligations |
|
3,626 |
|
|
1,049 |
|
||
Notes payable |
|
1,037,623 |
|
|
1,043,636 |
|
||
Tax receivable agreement liability |
|
67,927 |
|
|
69,745 |
|
||
Warrant liability |
|
14,713 |
|
|
29,616 |
|
||
Contingent consideration |
|
18,028 |
|
|
29,548 |
|
||
Deferred taxes |
|
55,586 |
|
|
144,529 |
|
||
Other noncurrent liabilities |
|
602 |
|
|
1,083 |
|
||
Total liabilities |
|
1,556,528 |
|
|
1,673,255 |
|
||
Commitments and Contingencies |
||||||||
Stockholders' Equity |
||||||||
Class A common stock |
|
31 |
|
|
30 |
|
||
Class V common stock |
|
— |
|
|
— |
|
||
Series B-1 common stock |
|
— |
|
|
— |
|
||
Series B-2 common stock |
|
— |
|
|
— |
|
||
Additional paid-in capital |
|
3,407,694 |
|
|
3,378,633 |
|
||
Accumulated other comprehensive loss |
|
(46,835 |
) |
|
(68,603 |
) |
||
Accumulated deficit |
|
(1,873,703 |
) |
|
(803,679 |
) |
||
Treasury stock, at cost |
|
(2,473 |
) |
|
(2,473 |
) |
||
Total E2open Parent Holdings, Inc. equity |
|
1,484,714 |
|
|
2,503,908 |
|
||
Noncontrolling interest |
|
100,413 |
|
|
223,012 |
|
||
Total stockholders' equity |
|
1,585,127 |
|
|
2,726,920 |
|
||
Total liabilities and stockholders' equity |
$ |
3,141,655 |
|
$ |
4,400,175 |
|
||
E2OPEN PARENT HOLDINGS, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
||||||||
Fiscal Year Ended |
||||||||
(In thousands) |
February 29, 2024 |
February 28, 2023 |
||||||
|
|
(Unaudited) |
|
|
||||
Cash flows from operating activities |
||||||||
Net loss |
$ |
(1,185,079 |
) |
$ |
(720,202 |
) |
||
Adjustments to reconcile net loss to net cash from operating activities: |
||||||||
Depreciation and amortization |
|
214,727 |
|
|
213,260 |
|
||
Amortization of deferred commissions |
|
6,269 |
|
|
4,051 |
|
||
Provision for credit losses |
|
3,870 |
|
|
549 |
|
||
Amortization of debt issuance costs |
|
5,281 |
|
|
5,103 |
|
||
Amortization of operating lease right-of-use assets |
|
7,419 |
|
|
7,636 |
|
||
Share-based compensation |
|
27,171 |
|
|
17,561 |
|
||
Deferred income taxes |
|
(87,790 |
) |
|
(259,426 |
) |
||
Loss on disposition |
|
— |
|
|
1,400 |
|
||
Right-of-use assets impairment charge |
|
659 |
|
|
4,137 |
|
||
Goodwill impairment charge |
|
1,097,741 |
|
|
901,566 |
|
||
Indefinite-lived intangible asset impairment charge |
|
34,000 |
|
|
— |
|
||
(Gain) loss from change in tax receivable agreement liability |
|
(2,190 |
) |
|
2,886 |
|
||
Gain from change in fair value of warrant liability |
|
(14,903 |
) |
|
(37,523 |
) |
||
Gain from change in fair value of contingent consideration |
|
(11,520 |
) |
|
(16,020 |
) |
||
Gain on operating lease termination |
|
(187 |
) |
|
— |
|
||
Loss on disposal of property and equipment |
|
526 |
|
|
994 |
|
||
Changes in operating assets and liabilities: |
||||||||
Accounts receivable |
|
9,382 |
|
|
(15,119 |
) |
||
Prepaid expenses and other current assets |
|
(2,087 |
) |
|
5,864 |
|
||
Other noncurrent assets |
|
(9,844 |
) |
|
(6,782 |
) |
||
Accounts payable and accrued liabilities |
|
(8,816 |
) |
|
(25,687 |
) |
||
Channel client deposits payable |
|
3,249 |
|
|
(7,762 |
) |
||
Deferred revenue |
|
8,884 |
|
|
3,450 |
|
||
Changes in other liabilities |
|
(11,891 |
) |
|
(11,838 |
) |
||
Net cash provided by operating activities |
|
84,871 |
|
|
68,098 |
|
||
Cash flows from investing activities |
||||||||
Payments for acquisitions - net of cash acquired |
|
— |
|
|
(179,243 |
) |
||
Capital expenditures |
|
(29,252 |
) |
|
(48,060 |
) |
||
Minority investment in private firm |
|
— |
|
|
(3,000 |
) |
||
Proceeds from disposition |
|
— |
|
|
1,574 |
|
||
Net cash used in investing activities |
|
(29,252 |
) |
|
(228,729 |
) |
||
Cash flows from financing activities |
||||||||
Proceeds from indebtedness |
|
— |
|
|
215,000 |
|
||
Repayments of indebtedness |
|
(11,168 |
) |
|
(115,915 |
) |
||
Repayments of financing lease obligations |
|
(2,852 |
) |
|
(2,487 |
) |
||
Repurchase of common units |
|
— |
|
|
(1,397 |
) |
||
Payments of debt issuance costs |
|
— |
|
|
(4,766 |
) |
||
Net cash (used in) provided by financing activities |
|
(14,020 |
) |
|
90,435 |
|
||
Effect of exchange rate changes on cash and cash equivalents |
|
3,097 |
|
|
(16 |
) |
||
Net increase (decrease) in cash, cash equivalents and restricted cash |
|
44,696 |
|
|
(70,212 |
) |
||
Cash, cash equivalents and restricted cash at beginning of year |
|
104,342 |
|
|
174,554 |
|
||
Cash, cash equivalents and restricted cash at end of year |
$ |
149,038 |
|
$ |
104,342 |
|
||
E2OPEN PARENT HOLDINGS, INC. RECONCILIATION OF PRO FORMA INFORMATION TABLE I |
||||||||
(in millions) |
Q4 |
Q4 |
$ Var |
% Var |
FY |
FY |
$ Var |
% Var |
FY2024 |
FY2023 |
FY2024 |
FY2023 |
|||||
PRO FORMA REVENUE RECONCILIATION |
|
|
|
|
||||
Total GAAP Revenue |
158.5 |
166.3 |
(7.8) |
(4.7%) |
634.6 |
652.2 |
(17.7) |
(2.7%) |
Constant currency FX impact (1) |
(1.0) |
- |
(1.0) |
n/m |
(2.2) |
- |
(2.2) |
n/m |
Total non-GAAP revenue (constant currency basis) (2) |
$157.5 |
$166.3 |
($8.8) |
(5.3%) |
$632.3 |
$652.2 |
($19.9) |
(3.1%) |
GAAP Subscription Revenue |
134.4 |
136.9 |
(2.5) |
(1.8%) |
536.8 |
532.9 |
3.8 |
0.7% |
Constant currency FX impact (1) |
(0.8) |
- |
(0.8) |
n/m |
(2.0) |
- |
(2.0) |
n/m |
Non-GAAP subscription revenue (constant currency basis) (2) |
$133.6 |
$136.9 |
($3.3) |
(2.4%) |
$534.8 |
$532.9 |
$1.9 |
0.4% |
|
|
|
|
|
|
|
|
|
GAAP Professional Services and other revenue |
24.1 |
29.4 |
(5.3) |
(18.0%) |
97.8 |
119.3 |
(21.5) |
(18.0%) |
Constant currency FX impact (1) |
(0.2) |
- |
(0.2) |
n/m |
(0.3) |
- |
(0.3) |
n/m |
Non-GAAP professional services and other revenue (constant currency basis) (2) |
$23.9 |
$29.4 |
($5.4) |
(18.5%) |
$97.5 |
$119.3 |
($21.8) |
(18.2%) |
|
|
|
|
|
|
|
|
|
PRO FORMA GROSS PROFIT RECONCILIATION |
|
|
|
|
||||
GAAP Gross profit |
80.5 |
87.0 |
(6.5) |
(7.5%) |
317.7 |
330.3 |
(12.6) |
(3.8%) |
Depreciation and amortization |
28.8 |
28.6 |
0.2 |
0.7% |
114.9 |
114.1 |
0.9 |
0.8% |
Share-based compensation (3) |
1.2 |
0.7 |
0.6 |
86.2% |
4.3 |
1.5 |
2.8 |
180.9% |
Non-recurring/non-operating costs (4) |
0.3 |
0.4 |
(0.0) |
(5.7%) |
3.6 |
2.5 |
1.1 |
46.3% |
Non-GAAP gross profit |
$110.9 |
$116.6 |
($5.7) |
(4.9%) |
$440.5 |
$448.3 |
($7.8) |
(1.7%) |
Non-GAAP Gross Margin % |
70.0% |
70.2% |
|
|
69.4% |
68.7% |
|
|
Constant currency FX impact (1) |
(0.9) |
- |
(0.9) |
n/m |
(2.0) |
- |
(2.0) |
n/m |
Total non-GAAP gross profit (constant currency basis) (2) |
$110.0 |
$116.6 |
($6.6) |
(5.7%) |
$438.5 |
$448.3 |
($9.8) |
(2.2%) |
Non-GAAP Gross Margin % (constant currency basis) (2) |
69.9% |
70.2% |
|
|
69.4% |
68.7% |
|
|
|
|
|
|
|
|
|
|
|
PRO FORMA ADJUSTED EBITDA RECONCILIATION |
|
|
|
|
||||
Net income (loss) |
(45.5) |
(303.5) |
258.0 |
n/m |
(1,185.1) |
(720.2) |
(464.9) |
n/m |
Interest expense, net |
24.7 |
21.4 |
3.3 |
15.4% |
98.6 |
73.8 |
24.8 |
n/m |
Income tax benefit |
(8.6) |
(120.4) |
111.8 |
(92.9%) |
(82.4) |
(250.4) |
168.0 |
n/m |
Depreciation and amortization |
54.0 |
53.4 |
0.5 |
1.0% |
214.7 |
213.3 |
1.5 |
0.7% |
EBITDA |
$24.6 |
($349.1) |
$373.6 |
n/m |
($954.2) |
($683.5) |
($270.6) |
n/m |
Share-based compensation (3) |
8.4 |
4.6 |
3.8 |
83.5% |
27.2 |
17.8 |
9.4 |
53.1% |
Non-recurring/non-operating costs (4) |
6.5 |
2.6 |
3.9 |
151.7% |
23.7 |
10.2 |
13.6 |
133.5% |
Acquisition-related adjustments (5) |
1.7 |
2.0 |
(0.3) |
(16.2%) |
2.1 |
16.3 |
(14.2) |
(87.2%) |
Change in tax receivable agreement liability(6) |
6.2 |
12.0 |
(5.8) |
(48.5%) |
(2.2) |
2.9 |
(5.1) |
n/m |
Change in fair value of warrant liability (7) |
3.9 |
(0.8) |
4.6 |
n/m |
(14.9) |
(37.5) |
22.6 |
n/m |
Change in fair value of contingent consideration (8) |
3.8 |
1.7 |
2.1 |
120.7% |
(11.5) |
(16.0) |
4.5 |
(28.1%) |
Goodwill impairment (9) |
- |
386.8 |
(386.8) |
n/m |
1,097.7 |
901.6 |
196.2 |
21.8% |
Intangible asset impairment charge (10) |
- |
- |
- |
n/m |
34.0 |
- |
34.0 |
n/m |
Right-of-use assets impairment charge (11) |
- |
- |
- |
n/m |
0.7 |
4.1 |
(3.5) |
(84.1%) |
Legal settlement (12) |
- |
- |
- |
n/m |
17.8 |
0.0 |
17.8 |
n/m |
Loss on disposition |
- |
1.4 |
(1.4) |
n/m |
- |
1.4 |
(1.4) |
n/m |
Adjusted EBITDA |
$55.1 |
$61.2 |
($6.1) |
(10.0%) |
$220.3 |
$217.1 |
$3.2 |
1.5% |
Adjusted EBITDA Margin % |
34.8% |
36.8% |
|
|
34.7% |
33.3% |
|
|
Constant currency FX impact (1) |
(0.8) |
- |
(0.8) |
n/m |
(1.9) |
- |
(1.9) |
n/m |
Total adjusted EBITDA (constant currency basis) (2) |
$54.3 |
$61.2 |
($6.9) |
(11.3%) |
$218.5 |
$217.1 |
$1.3 |
0.6% |
Adjusted EBITDA Margin % (constant currency basis) (2) |
34.5% |
36.8% |
|
|
34.5% |
33.3% |
|
|
(1) Constant Currency refers to pro-forma amounts excluding the impact of translating foreign currencies into U.S. dollars. To calculate foreign currency translation on a constant currency basis, operating results for the current year period for entities reporting in currencies other than the U.S. dollar are translated into U.S. dollars at the exchange rates in effect during the comparable period of the prior year (rather than the actual exchange rates in effect during the current year period). |
||||||||
(2) Constant Currency refers to pro forma amounts excluding translation and transactional impacts from foreign currency exchange rates. |
||||||||
(3) Reflects non-cash, long-term share-based compensation expense. |
||||||||
(4) Primarily includes other non-recurring expenses such as non-acquisition related severance, foreign currency transaction gains and losses, systems integrations, legal entity rationalization, expenses related to retention of key employees from acquisitions and non-recurring consulting and advisory fees. |
||||||||
(5) Primarily includes advisory, consulting, accounting and legal expenses and severance incurred in connection with mergers and acquisitions activities, including related valuation, negotiation and integration costs and capital-raising activities, related to the Business Combination, acquisitions of BluJay and Logistyx and the strategic review. |
||||||||
(6) Represents the fair value adjustment at each balance sheet date for the Tax Receivable Agreement along with the associated interest. |
||||||||
(7) Represents the fair value adjustment at each balance sheet date of the warrant liability related to our warrants. |
||||||||
(8) Represents the fair value adjustment at each balance sheet date of the contingent consideration liability related to the restricted Series B-1 and B-2 common stock and Sponsor Side Letter and Series 1 and 2 RCUs. The Series B-1 common stock, Sponsor Side Letter and Series 1 RCUs were automatically converted into our Class A Common Stock on a one-to-one basis as of June 8, 2021. |
||||||||
(9) Represents the goodwill impairment taken in the first and third quarters of fiscal 2024 and second and fourth quarters of fiscal 2023. |
||||||||
(10) Represents the indefinite-lived trademark/ trade name impairment taken in the first and third quarter of fiscal 2024. |
||||||||
(11) Represents the impairment on our operating lease ROU assets and leasehold improvements due to vacating certain facilities. |
||||||||
(12) Represents the $17.8 million litigation settlement for the unfavorable arbitration ruling related to the Kewill customer case. |
||||||||
| E2OPEN PARENT HOLDINGS, INC.
RECONCILIATION OF NON-GAAP EXPENSES TABLE II |
||||||||
Fiscal Year Ended February 29, 2024 |
||||||||
(in millions) |
GAAP |
Non-recurring(1) |
Impairment
|
Depreciation & Amortization |
Share-Based Compensation |
Legal Settlement (3) |
Non-GAAP (Adjusted) |
% of Revenue |
COST OF GOODS |
|
|
|
|
|
|
|
|
Subscriptions |
146.0 |
(1.8) |
- |
(15.6) |
(2.4) |
- |
126.3 |
23.5% |
Professional services and other |
72.3 |
(1.8) |
- |
(0.7) |
(1.9) |
- |
67.8 |
69.4% |
Amortization of intangibles |
98.6 |
- |
- |
(98.6) |
- |
- |
- |
|
Total cost of revenue |
$316.9 |
($3.6) |
- |
($114.9) |
($4.3) |
- |
$194.1 |
30.6% |
|
|
|
|
|
|
|
|
|
Gross Profit |
$317.7 |
$3.6 |
- |
$114.9 |
$4.3 |
- |
$440.5 |
69.4% |
|
|
|
|
|
|
|
|
|
OPERATING COSTS |
|
|
|
|
|
|
|
|
Research & development |
101.4 |
(0.8) |
- |
(16.6) |
(5.7) |
- |
78.4 |
12.4% |
Sales & marketing |
87.7 |
(2.3) |
- |
(1.2) |
(5.7) |
- |
78.5 |
12.4% |
General & administrative |
108.1 |
(13.1) |
(0.7) |
(1.8) |
(11.5) |
(17.8) |
63.2 |
10.0% |
Acquisition related expenses |
2.1 |
(2.1) |
- |
- |
- |
- |
- |
|
Amortization of intangibles |
80.3 |
- |
- |
(80.3) |
- |
- |
- |
|
Intangible impairment charge |
34.0 |
- |
(34.0) |
- |
- |
- |
- |
|
Goodwill Impairment |
1,097.7 |
- |
(1,097.7) |
- |
- |
- |
- |
|
Total operating expenses |
$1,511.3 |
($18.3) |
($1,132.4) |
($99.8) |
($22.9) |
($17.8) |
$220.2 |
34.7% |
|
|
|
|
|
|
|
|
|
(1) Primarily includes other non-recurring expenses such as severance, foreign currency transaction gains and losses, systems integrations, legal entity rationalization, expenses related to retention of key employees from acquisitions and non-recurring consulting and advisory fees in connection with mergers, acquisitions and the strategic review. |
||||||||
(2) Represents the impairment on our operating lease ROU assets and leasehold improvements due to vacating certain facilities, the goodwill impairment taken in the first and third quarters of fiscal 2024 and second and fourth quarters of fiscal 2023 and the indefinite-lived trademark/ trade name impairment taken in the first and third quarter of fiscal 2024. |
||||||||
(3) Represents the $17.8 million litigation settlement for the unfavorable arbitration ruling related to the Kewill customer case. |
||||||||
E2OPEN PARENT HOLDINGS, INC. RECONCILIATION OF NON-GAAP EXPENSES TABLE II |
||||||
Fiscal Fourth Quarter 2024 |
||||||
GAAP |
Non-recurring(1) |
Depreciation & Amortization |
Share-Based Compensation |
Non-GAAP (Adjusted) |
% of Revenue |
|
| (in millions) | ||||||
COST OF GOODS |
||||||
Subscriptions |
36.0 |
(0.2) |
(3.9) |
(0.7) |
31.2 |
23.2% |
Professional services and other |
17.2 |
(0.1) |
(0.2) |
(0.6) |
16.4 |
67.9% |
Amortization of intangibles |
24.7 |
- |
(24.7) |
- |
- |
|
Total cost of revenue |
$77.9 |
($0.3) |
($28.8) |
($1.2) |
$47.5 |
30.0% |
|
|
|
|
|
|
|
Gross Profit |
$80.5 |
$0.3 |
$28.8 |
$1.2 |
$110.9 |
70.0% |
|
|
|
|
|
|
|
OPERATING COSTS |
|
|
|
|
|
|
Research & development |
25.7 |
(0.1) |
(4.5) |
(1.5) |
19.6 |
12.3% |
Sales & marketing |
24.0 |
(1.3) |
(0.3) |
(2.2) |
20.2 |
12.8% |
General & administrative |
22.6 |
(2.9) |
(0.2) |
(3.5) |
16.0 |
10.1% |
Acquisition related expenses |
1.7 |
(1.7) |
- |
- |
- |
|
Amortization of intangibles |
20.1 |
- |
(20.1) |
- |
- |
|
Intangible impairment charge |
- |
- |
- |
- |
- |
|
Goodwill Impairment |
- |
- |
- |
- |
- |
|
Total operating expenses |
$94.1 |
($6.0) |
($25.1) |
($7.2) |
$55.8 |
35.2% |
|
|
|
|
|
|
|
(1) Primarily includes other non-recurring expenses such as severance, foreign currency transaction gains and losses, systems integrations, legal entity rationalization, expenses related to retention of key employees from acquisitions and non-recurring consulting and advisory fees in connection with mergers, acquisitions and the strategic review. |
||||||
E2OPEN PARENT HOLDINGS, INC. RECONCILIATION OF ADJUSTED EARNINGS PER SHARE TABLE III |
|||||
(in millions, except per share amounts) |
Q1 24 |
Q2 24 |
Q3 24 |
Q4 24 |
FY2024 |
GAAP Net Loss |
(360.9) |
(38.6) |
(740.0) |
(45.5) |
(1,185.1) |
Interest expense, net |
24.3 |
24.7 |
24.9 |
24.7 |
98.6 |
Income taxes benefit |
(66.3) |
(2.1) |
(5.4) |
(8.6) |
(82.4) |
Depreciation & amortization |
53.3 |
53.9 |
53.6 |
54.0 |
214.7 |
EBITDA |
($349.6) |
$37.8 |
($666.9) |
$24.6 |
($954.2) |
Share-based compensation |
4.5 |
7.4 |
6.8 |
8.4 |
27.2 |
Non-recurring/non-operating costs |
5.3 |
3.6 |
8.3 |
6.5 |
23.7 |
Acquisition-related adjustments |
0.4 |
0.0 |
0.0 |
1.7 |
2.1 |
Change in tax receivable agreement liability |
2.5 |
(7.9) |
(2.9) |
6.2 |
(2.2) |
Change in fair value of warrant liability |
(14.7) |
(1.5) |
(2.6) |
3.9 |
(14.9) |
Change in fair value of contingent consideration |
(9.0) |
(1.3) |
(5.1) |
3.8 |
(11.5) |
Goodwill impairment |
410.0 |
- |
687.7 |
- |
1,097.7 |
Intangible asset impairment charge |
4.0 |
- |
30.0 |
- |
34.0 |
Right-of-use assets impairment charge |
0.4 |
0.2 |
0.1 |
0.0 |
0.7 |
Legal settlement |
- |
17.8 |
- |
- |
17.8 |
Adjusted EBITDA |
$53.8 |
$56.1 |
$55.4 |
$55.1 |
$220.3 |
Depreciation |
(8.6) |
(9.2) |
(9.0) |
(9.1) |
(35.9) |
Interest and other expense, net |
(24.3) |
(24.7) |
(24.9) |
(24.7) |
(98.6) |
Adjusted EBIT |
$20.9 |
$22.3 |
$21.4 |
$21.3 |
$85.9 |
Normalized income taxes (1) |
(5.0) |
(5.4) |
(5.1) |
(5.1) |
(20.6) |
Adjusted Net Income |
$15.9 |
$16.9 |
$16.3 |
$16.2 |
$65.3 |
Adjusted basic shares outstanding |
342.2 |
387.3 |
388.0 |
343.3 |
343.3 |
Adjusted earnings per share |
$0.05 |
$0.04 |
$0.04 |
$0.05 |
$0.19 |
(1) Income taxes calculated using 24% effective rate. |
|||||
E2OPEN PARENT HOLDINGS, INC. ADJUSTED FREE CASH FLOW TABLE IV |
|||||
(in millions) |
Q1 24 |
Q2 24 |
Q3 24 |
Q4 24 |
FY2024 |
GAAP operating cash flow |
36.5 |
14.8 |
5.4 |
28.2 |
84.9 |
|
|
|
|
|
|
Add: Non recurring cash payments (1) |
3.4 |
1.9 |
25.5 |
3.6 |
34.3 |
Add: Change in channel client deposits payable (2) |
(2.5) |
(8.9) |
3.1 |
5.1 |
(3.2) |
Adjusted operating cash flow |
$37.3 |
$7.7 |
$34.0 |
$36.9 |
$116.0 |
|
|
|
|
|
|
Capital expenditures |
(6.6) |
(9.5) |
(6.2) |
(7.0) |
(29.3) |
Adjusted free cash flow |
$30.8 |
($1.8) |
$27.7 |
$30.0 |
$86.7 |
(1) Primarily includes cash payment of a $17.8 million legal settlement for the previously disclosed unfavorable arbitration ruling related to a 2014 contract between Kewill (a predecessor of BluJay), as well as other non-recurring costs. |
|||||
(2) Channel Client Deposits Payable represents client deposits for the incentive payment program associated with the Company's channel shaping application. The Company offers services to administer incentive payments to partners on behalf of the Company’s clients. The Company’s clients deposit these funds into a restricted cash account with an offset included as a liability in incentive program payable in the Consolidated Balance Sheets. |
|||||
E2OPEN PARENT HOLDINGS, INC. CONSOLIDATED CAPITAL TABLE V |
|||
Description |
Shares (000's) |
Notes |
|
Shares outstanding as of February 29, 2024 |
306,061 |
|
Shares outstanding |
Common Units |
31,226 |
Units issued in the Business Combination that have not been converted from common units to Class A common stock (Common units are represented by Class V shares). |
|
Series B-2 Shares (unvested) |
3,372 |
|
Represents the right to acquire shares of Class A common stock when the 20-day VWAP reaches $15.00 per share. |
Restricted Common Units Series 2 (unvested) |
2,628 |
Represents the right in E2open Holdings, LLC that converts into common units when the 20-day VWAP reaches $15.00. Upon conversion to common units, the holders can elect to convert the common units to Class A common stock. |
|
Adjusted Basic Shares |
343,287 |
|
|
|
|||
Warrants |
29,080 |
|
Outstanding warrants with an exercise price of $11.50. |
Options (vested/unreleased and unvested) |
4,992 |
Options issued to management under the long-term incentive plan. |
|
Restricted Shares (vested/unreleased and unvested) |
16,726 |
|
Restricted shares issued to employees, management and directors under the long-term incentive plan. |
Fully Converted Shares |
394,085 |
||
View source version on businesswire.com: https://www.businesswire.com/news/home/20240429461989/en/
Contacts
Investor Contact
Dusty Buell
dusty.buell@e2open.com
investor.relations@e2open.com
Media Contact
5W PR for e2open
e2open@5wpr.com
718-757-6144
Corporate Contact
Kristin Seigworth
VP Communications, e2open
kristin.seigworth@e2open.com
pr@e2open.com
