Thryv Accelerates SaaS Revenue Growth and Achieves the "Rule of 401" in Third Quarter 2024
– Grows SaaS Revenue 29% in Q3 2024
– Raises Full Year 2024 SaaS guidance
– Seasoned NDR increases 900 bps year-over-year to 101%
– Closes acquisition of Infusion Software, Inc., "Keap"
Thryv Holdings, Inc. (NASDAQ:THRY) ("Thryv" or the "Company"), the provider of Thryv®, the leading small business software platform, reported SaaS revenue growth of 29% year-over-year in the third quarter of 2024.
"We had a strong third quarter - delivering SaaS revenue growth of 29% year-over-year and record SaaS margins," said Joe Walsh, Thryv Chairman and CEO. "We reported 45% year-over-year growth in SaaS clients as we are upgrading our marketing service clients to our SaaS platform and have continued to execute on our transformation strategy. In addition, we achieved a significant milestone that further validates our business model and reached the 'Rule of 40' this quarter.
"With our recent acquisition of Keap, Thryv will be offering an expanded, integrated set of marketing and sales solutions, and a strong global partner channel, to our 100,000-plus SaaS clients," said Walsh.
"In the third quarter, we beat our SaaS Revenue and Adjusted EBITDA guidance and are raising our full year SaaS guidance," stated Paul Rouse, Chief Financial Officer. "Our Seasoned NDR increased to 101%, as we continue to increase paid centers per client, which grew 12% this quarter, demonstrating the success of our land-and-expand strategy."
Third Quarter 2024 Highlights:
- Total SaaS revenue was $87.1 million, a 29% increase year-over-year
- Total Marketing Services revenue was $92.8 million, a 20% decrease year-over-year
- Consolidated total revenue was $179.9 million, a decrease of 2% year-over-year
- Consolidated net loss was $96.1 million, or $(2.65) per diluted share; which includes a non-cash charge of $83.1 million, or $(2.29) per diluted share, related to a goodwill impairment for our Marketing Services segment; compared to net loss of $27.0 million, or $(0.78) per diluted share, for the third quarter of 2023
- Consolidated Adjusted EBITDA was $19.6 million, representing an Adjusted EBITDA margin of 10.9%
- Total SaaS Adjusted EBITDA was $10.3 million, representing an Adjusted EBITDA margin of 11.8%
- Total Marketing Services Adjusted EBITDA was $9.3 million, representing an Adjusted EBITDA margin of 10.0%
- Consolidated Gross Profit was $112.0 million
- Consolidated Adjusted Gross Profit2 was $116.8 million
- SaaS Gross Profit was $60.6 million
- SaaS Adjusted Gross Profit was $62.9 million, representing an Adjusted Gross Profit Margin of 72.2%
SaaS Metrics
- Total SaaS clients increased 45% year-over-year to 96 thousand for the third quarter of 2024
- Seasoned Net Dollar Retention3 was 101% for the third quarter of 2024, an increase of 900 bps year-over-year
- SaaS monthly Average Revenue per Unit ("ARPU")4 was $307 for the third quarter of 2024
- ThryvPay total payment volume was $82 million, an increase of 30% year-over-year
Outlook
Based on information available as of November 7, 2024, Thryv is issuing guidance5 for the fourth quarter of 2024 and full year 2024 as indicated below:
|
4th Quarter |
|
Full Year |
(in millions) |
2024 |
|
2024 |
SaaS Revenue |
$90.0 - $92.0 |
|
$329.5 - $331.5 |
SaaS Adjusted EBITDA |
$9.5 - $10.5 |
|
$33.5 - $34.5 |
|
4th Quarter |
|
Full Year |
(in millions) |
2024 |
|
2024 |
Marketing Services Revenue |
$81.0 - $83.0 |
|
$479.0 - $481.0 |
Marketing Services Adjusted EBITDA |
$16.0 - $19.0 |
|
$125.0 - $128.0 |
For the fourth quarter of 2024, the Company's recent acquisition of Keap is expected to contribute SaaS revenue in the range of $11.0 to $12.0 million, which relates to November and December and is not included in the guidance issued above. Keap's SaaS Adjusted EBITDA is expected to be de minimus for the fourth quarter of 2024 and is also not included in the guidance issued above.
Earnings Conference Call Information
Thryv will host a conference call on Thursday, November 7, 2024 at 8:30 a.m. (Eastern Time) to discuss the Company's third quarter 2024 results.
For analysts to register for this conference call, please use this link. After registering, a confirmation email will be sent, including dial-in details and a unique code for entry. We recommend registering a day in advance or at a minimum thirty minutes prior to the start of the call. To listen to the webcast, please use this link or visit Thryv's Investor Relations website at investor.thryv.com. A live webcast will also be available on the Investor Relations section of the Company's website at investor.thryv.com.
If you are unable to participate in the conference call, a replay will be available at this link.
Thryv Holdings, Inc. and Subsidiaries
Consolidated Statements of Operations and Comprehensive (Loss)
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||
|
September 30, |
|
September 30, |
||||||||||||
(in thousands, except share and per share data) |
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Revenue |
$ |
179,852 |
|
|
$ |
183,822 |
|
|
$ |
637,560 |
|
|
$ |
680,798 |
|
Cost of services |
|
67,871 |
|
|
|
80,178 |
|
|
|
223,350 |
|
|
|
262,261 |
|
Gross profit |
|
111,981 |
|
|
|
103,644 |
|
|
|
414,210 |
|
|
|
418,537 |
|
|
|
|
|
|
|
|
|
||||||||
Operating expenses: |
|
|
|
|
|
|
|
||||||||
Sales and marketing |
|
66,484 |
|
|
|
74,755 |
|
|
|
201,984 |
|
|
|
226,781 |
|
General and administrative |
|
50,972 |
|
|
|
48,267 |
|
|
|
155,229 |
|
|
|
149,642 |
|
Impairment charges |
|
83,094 |
|
|
|
— |
|
|
|
83,094 |
|
|
|
— |
|
Total operating expenses |
|
200,550 |
|
|
|
123,022 |
|
|
|
440,307 |
|
|
|
376,423 |
|
|
|
|
|
|
|
|
|
||||||||
Operating (loss) income |
|
(88,569 |
) |
|
|
(19,378 |
) |
|
|
(26,097 |
) |
|
|
42,114 |
|
Other income (expense): |
|
|
|
|
|
|
|
||||||||
Interest expense |
|
(8,194 |
) |
|
|
(15,131 |
) |
|
|
(31,554 |
) |
|
|
(47,911 |
) |
Interest expense, related party |
|
(3,320 |
) |
|
|
— |
|
|
|
(5,494 |
) |
|
|
— |
|
Other components of net periodic pension cost |
|
(1,581 |
) |
|
|
(1,902 |
) |
|
|
(4,743 |
) |
|
|
(3,888 |
) |
Other income (expense) |
|
218 |
|
|
|
(876 |
) |
|
|
(7,571 |
) |
|
|
(1,242 |
) |
(Loss) before income tax benefit (expense) |
|
(101,446 |
) |
|
|
(37,287 |
) |
|
|
(75,459 |
) |
|
|
(10,927 |
) |
Income tax benefit (expense) |
|
5,375 |
|
|
|
10,241 |
|
|
|
(6,640 |
) |
|
|
9,173 |
|
Net (loss) |
$ |
(96,071 |
) |
|
$ |
(27,046 |
) |
|
$ |
(82,099 |
) |
|
$ |
(1,754 |
) |
Other comprehensive income (loss): |
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustment, net of tax |
|
1,330 |
|
|
|
(1,842 |
) |
|
|
1,132 |
|
|
|
(4,332 |
) |
Comprehensive (loss) |
$ |
(94,741 |
) |
|
$ |
(28,888 |
) |
|
$ |
(80,967 |
) |
|
$ |
(6,086 |
) |
|
|
|
|
|
|
|
|
||||||||
Net (loss) per common share: |
|
|
|
|
|
|
|
||||||||
Basic |
$ |
(2.65 |
) |
|
$ |
(0.78 |
) |
|
$ |
(2.28 |
) |
|
$ |
(0.05 |
) |
Diluted |
$ |
(2.65 |
) |
|
$ |
(0.78 |
) |
|
$ |
(2.28 |
) |
|
$ |
(0.05 |
) |
|
|
|
|
|
|
|
|
||||||||
Weighted-average shares used in computing basic and diluted net (loss) per common share: |
|
|
|
|
|
|
|
||||||||
Basic |
|
36,308,992 |
|
|
|
34,848,899 |
|
|
|
35,983,826 |
|
|
|
34,619,794 |
|
Diluted |
|
36,308,992 |
|
|
|
34,848,899 |
|
|
|
35,983,826 |
|
|
|
34,619,794 |
|
Thryv Holdings, Inc. and Subsidiaries
Consolidated Balance Sheets
(in thousands, except share data) |
September 30, 2024 |
|
December 31, 2023 |
||||
Assets |
|
|
|
||||
Current assets |
|
|
|
||||
Cash and cash equivalents |
$ |
12,453 |
|
|
$ |
18,216 |
|
Accounts receivable, net of allowance of $18,890 in 2024 and $14,926 in 2023 |
|
176,364 |
|
|
|
205,503 |
|
Contract assets, net of allowance of $33 in 2024 and $35 in 2023 |
|
9,068 |
|
|
|
2,909 |
|
Taxes receivable |
|
2,706 |
|
|
|
3,085 |
|
Prepaid expenses |
|
18,383 |
|
|
|
17,771 |
|
Deferred costs |
|
10,184 |
|
|
|
16,722 |
|
Other current assets |
|
1,780 |
|
|
|
2,662 |
|
Total current assets |
|
230,938 |
|
|
|
266,868 |
|
Fixed assets and capitalized software, net |
|
37,142 |
|
|
|
38,599 |
|
Goodwill |
|
218,884 |
|
|
|
302,400 |
|
Intangible assets, net |
|
3,453 |
|
|
|
18,788 |
|
Deferred tax assets |
|
139,769 |
|
|
|
128,051 |
|
Other assets |
|
24,567 |
|
|
|
28,464 |
|
Total assets |
$ |
654,753 |
|
|
$ |
783,170 |
|
|
|
|
|
||||
Liabilities and Stockholders' Equity |
|
|
|
||||
Current liabilities |
|
|
|
||||
Accounts payable |
$ |
6,946 |
|
|
$ |
10,348 |
|
Accrued liabilities |
|
98,439 |
|
|
|
105,903 |
|
Current portion of unrecognized tax benefits |
|
25,623 |
|
|
|
23,979 |
|
Contract liabilities |
|
32,534 |
|
|
|
44,558 |
|
Current portion of Term Loan |
|
35,783 |
|
|
|
70,000 |
|
Current portion of Term Loan, related party |
|
16,717 |
|
|
|
— |
|
Other current liabilities |
|
5,906 |
|
|
|
8,402 |
|
Total current liabilities |
|
221,948 |
|
|
|
263,190 |
|
Term Loan, net |
|
157,794 |
|
|
|
230,052 |
|
Term Loan, net, related party |
|
75,610 |
|
|
|
— |
|
ABL Facility |
|
21,900 |
|
|
|
48,845 |
|
Pension obligations, net |
|
73,723 |
|
|
|
69,388 |
|
Other liabilities |
|
9,246 |
|
|
|
18,995 |
|
Total long-term liabilities |
|
338,273 |
|
|
|
367,280 |
|
Commitments and contingencies |
|
|
|
||||
Stockholders' equity |
|
|
|
||||
Common stock - $0.01 par value, 250,000,000 shares authorized; 63,840,032 shares issued and 36,322,417 shares outstanding at September 30, 2024; and 62,660,783 shares issued and 35,302,746 shares outstanding at December 31, 2023 |
|
638 |
|
|
|
627 |
|
Additional paid-in capital |
|
1,177,078 |
|
|
|
1,151,259 |
|
Treasury stock - 27,517,615 shares at September 30, 2024 and 27,358,037 shares at December 31, 2023 |
|
(488,824 |
) |
|
|
(485,793 |
) |
Accumulated other comprehensive loss |
|
(14,059 |
) |
|
|
(15,191 |
) |
Accumulated deficit |
|
(580,301 |
) |
|
|
(498,202 |
) |
Total stockholders' equity |
|
94,532 |
|
|
|
152,700 |
|
Total liabilities and stockholders' equity |
$ |
654,753 |
|
|
$ |
783,170 |
|
Thryv Holdings, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
|
Nine Months Ended September 30, |
||||||
(in thousands) |
|
2024 |
|
|
|
2023 |
|
Cash Flows from Operating Activities |
|
|
|
||||
Net (loss) |
$ |
(82,099 |
) |
|
$ |
(1,754 |
) |
Adjustments to reconcile net (loss) to net cash provided by operating activities: |
|
|
|
||||
Depreciation and amortization |
|
41,144 |
|
|
|
46,940 |
|
Amortization of deferred commissions |
|
14,251 |
|
|
|
10,304 |
|
Amortization of debt issuance costs |
|
3,151 |
|
|
|
4,080 |
|
Deferred income taxes |
|
(11,823 |
) |
|
|
808 |
|
Provision for credit losses and service credits |
|
16,496 |
|
|
|
15,594 |
|
Stock-based compensation expense |
|
17,653 |
|
|
|
16,653 |
|
Other components of net periodic pension cost |
|
4,743 |
|
|
|
3,888 |
|
Impairment charges |
|
83,094 |
|
|
|
— |
|
Loss on foreign currency exchange rates |
|
933 |
|
|
|
164 |
|
Non-cash loss from the remeasurement of the indemnification asset |
|
— |
|
|
|
10,734 |
|
Loss on early extinguishment of debt |
|
6,638 |
|
|
|
— |
|
Other |
|
(3,167 |
) |
|
|
— |
|
Changes in working capital items, excluding acquisitions: |
|
|
|
||||
Accounts receivable |
|
18,161 |
|
|
|
59,238 |
|
Contract assets |
|
(6,160 |
) |
|
|
1,111 |
|
Prepaid expenses and other assets |
|
(7,079 |
) |
|
|
23,489 |
|
Accounts payable and accrued liabilities |
|
(14,108 |
) |
|
|
(63,469 |
) |
Other liabilities |
|
(18,188 |
) |
|
|
(24,132 |
) |
Net cash provided by operating activities |
|
63,640 |
|
|
|
103,648 |
|
|
|
|
|
||||
Cash Flows from Investing Activities |
|
|
|
||||
Additions to fixed assets and capitalized software |
|
(24,730 |
) |
|
|
(22,920 |
) |
Acquisition of a business, net of cash acquired |
|
— |
|
|
|
(8,897 |
) |
Other |
|
— |
|
|
|
(215 |
) |
Net cash used in investing activities |
|
(24,730 |
) |
|
|
(32,032 |
) |
|
|
|
|
||||
Cash Flows from Financing Activities |
|
|
|
||||
Proceeds from Term Loan |
|
234,256 |
|
|
|
— |
|
Proceeds from Term Loan, related party |
|
109,444 |
|
|
|
— |
|
Payments of Term Loan |
|
(345,151 |
) |
|
|
(95,000 |
) |
Payments of Term Loan, related party |
|
(16,717 |
) |
|
|
— |
|
Proceeds from ABL Facility |
|
247,579 |
|
|
|
697,234 |
|
Payments of ABL Facility |
|
(274,524 |
) |
|
|
(694,395 |
) |
Debt issuance costs |
|
(5,480 |
) |
|
|
— |
|
Purchase of treasury stock |
|
(499 |
) |
|
|
— |
|
Proceeds from exercises of stock warrants |
|
— |
|
|
|
15,899 |
|
Other |
|
5,646 |
|
|
|
4,124 |
|
Net cash used in financing activities |
|
(45,446 |
) |
|
|
(72,138 |
) |
|
|
|
|
||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash |
|
(120 |
) |
|
|
(707 |
) |
(Decrease) in cash, cash equivalents and restricted cash |
|
(6,656 |
) |
|
|
(1,229 |
) |
Cash, cash equivalents and restricted cash, beginning of period |
|
20,530 |
|
|
|
18,180 |
|
Cash, cash equivalents and restricted cash, end of period |
$ |
13,874 |
|
|
$ |
16,951 |
|
|
|
|
|
||||
Supplemental Information |
|
|
|
||||
Cash paid for interest |
$ |
35,299 |
|
|
$ |
44,029 |
|
Cash paid for income taxes, net |
$ |
14,960 |
|
|
$ |
7,605 |
|
|
|
|
|
||||
Non-cash investing and financing activities |
|
|
|
||||
Repurchase of Treasury stock as a result of the settlement of the indemnification asset |
$ |
— |
|
|
$ |
15,760 |
|
Segment Information
During first quarter of 2024, the Company changed the internal reporting provided to the chief operating decision maker ("CODM"). As a result, the Company reevaluated its segment reporting and determined that Thryv U.S. Marketing Services and Thryv International Marketing Services should be reflected as a single reportable segment, and that Thryv U.S. SaaS and Thryv International SaaS should be reflected as a single reportable segment. As such, beginning on January 1, 2024, the results of our Marketing Services and SaaS businesses are presented as two reportable segments. Comparative prior periods have been recast to reflect the current presentation.
The following tables summarize the operating results of the Company's reportable segments:
|
Three Months Ended September 30, |
|
Change |
||||||||||
(in thousands) |
|
2024 |
|
|
2023 |
|
|
Amount |
|
% |
|||
Revenue |
|
|
|
|
|
|
|
||||||
Marketing Services |
$ |
92,797 |
|
$ |
116,462 |
|
|
$ |
(23,665 |
) |
|
(20.3 |
)% |
SaaS |
|
87,055 |
|
|
67,360 |
|
|
|
19,695 |
|
|
29.2 |
% |
Total Revenue |
$ |
179,852 |
|
$ |
183,822 |
|
|
$ |
(3,970 |
) |
|
(2.2 |
)% |
|
|
|
|
|
|
|
|
||||||
Segment Gross Profit |
|
|
|
|
|
|
|
||||||
Marketing Services |
$ |
51,374 |
|
$ |
60,776 |
|
|
$ |
(9,402 |
) |
|
(15.5 |
)% |
SaaS |
|
60,607 |
|
|
42,868 |
|
|
|
17,739 |
|
|
41.4 |
% |
Consolidated Segment Gross Profit |
$ |
111,981 |
|
$ |
103,644 |
|
|
$ |
8,337 |
|
|
8.0 |
% |
|
|
|
|
|
|
|
|
||||||
Segment EBITDA |
|
|
|
|
|
|
|
||||||
Marketing Services |
$ |
9,309 |
|
$ |
7,835 |
|
|
$ |
1,474 |
|
|
18.8 |
% |
SaaS |
|
10,314 |
|
|
(504 |
) |
|
|
10,818 |
|
|
NM |
|
Consolidated Adjusted EBITDA |
$ |
19,623 |
|
$ |
7,331 |
|
|
$ |
12,292 |
|
|
167.7 |
% |
|
Nine Months Ended September 30, |
|
Change |
|||||||||
(in thousands) |
|
2024 |
|
|
2023 |
|
Amount |
|
% |
|||
Revenue |
|
|
|
|
|
|
|
|||||
Marketing Services |
$ |
398,389 |
|
$ |
491,051 |
|
$ |
(92,662 |
) |
|
(18.9 |
)% |
SaaS |
|
239,171 |
|
|
189,747 |
|
|
49,424 |
|
|
26.0 |
% |
Total Revenue |
$ |
637,560 |
|
$ |
680,798 |
|
$ |
(43,238 |
) |
|
(6.4 |
)% |
|
|
|
|
|
|
|
|
|||||
Segment Gross Profit |
|
|
|
|
|
|
|
|||||
Marketing Services |
$ |
252,219 |
|
$ |
299,305 |
|
$ |
(47,086 |
) |
|
(15.7 |
)% |
SaaS |
|
161,991 |
|
|
119,232 |
|
|
42,759 |
|
|
35.9 |
% |
Consolidated Segment Gross Profit |
$ |
414,210 |
|
$ |
418,537 |
|
$ |
(4,327 |
) |
|
(1.0 |
)% |
|
|
|
|
|
|
|
|
|||||
Segment EBITDA |
|
|
|
|
|
|
|
|||||
Marketing Services |
$ |
109,137 |
|
$ |
129,717 |
|
$ |
(20,580 |
) |
|
(15.9 |
)% |
SaaS |
|
23,914 |
|
|
5,522 |
|
|
18,392 |
|
|
NM |
|
Consolidated Adjusted EBITDA |
$ |
133,051 |
|
$ |
135,239 |
|
$ |
(2,188 |
) |
|
(1.6 |
)% |
Non-GAAP Measures
Our results included in this press release include Adjusted EBITDA, Adjusted EBITDA Margin 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 (loss) and Adjusted Gross Profit to Gross profit. Both Net income (loss) and Gross profit are the most comparable GAAP financial measure to Adjusted EBITDA and Adjusted Gross Profit, respectively. Adjusted EBITDA margin is defined as Adjusted EBITDA divided by revenue.
We believe that these non-GAAP financial measures provide useful information about our financial performance, enhance the overall understanding of our past performance 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 additional tools 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 (loss):
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
||||||||||||
(in thousands) |
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Reconciliation of Adjusted EBITDA |
|
|
|
|
|
|
|
||||||||
Net (loss) |
$ |
(96,071 |
) |
|
$ |
(27,046 |
) |
|
$ |
(82,099 |
) |
|
$ |
(1,754 |
) |
Interest expense |
|
11,514 |
|
|
|
15,131 |
|
|
|
37,048 |
|
|
|
47,911 |
|
Depreciation and amortization expense |
|
12,519 |
|
|
|
15,842 |
|
|
|
41,144 |
|
|
|
46,940 |
|
Stock-based compensation expense (1) |
|
6,011 |
|
|
|
5,462 |
|
|
|
17,653 |
|
|
|
16,653 |
|
Restructuring and integration expenses (2) |
|
4,861 |
|
|
|
3,584 |
|
|
|
17,679 |
|
|
|
12,845 |
|
Income tax (benefit) expense |
|
(5,375 |
) |
|
|
(10,241 |
) |
|
|
6,640 |
|
|
|
(9,173 |
) |
Transaction costs (3) |
|
1,706 |
|
|
|
— |
|
|
|
1,706 |
|
|
|
373 |
|
Other components of net periodic pension cost (4) |
|
1,581 |
|
|
|
1,902 |
|
|
|
4,743 |
|
|
|
3,888 |
|
Loss on early extinguishment of debt (5) |
|
— |
|
|
|
— |
|
|
|
6,638 |
|
|
|
— |
|
Non-cash loss from remeasurement of indemnification asset (6) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
10,734 |
|
Impairment charges |
|
83,094 |
|
|
|
— |
|
|
|
83,094 |
|
|
|
— |
|
Other (7) |
|
(217 |
) |
|
|
2,697 |
|
|
|
(1,195 |
) |
|
|
6,822 |
|
Adjusted EBITDA |
$ |
19,623 |
|
|
$ |
7,331 |
|
|
$ |
133,051 |
|
|
$ |
135,239 |
|
(1) |
We record stock-based compensation expense related to the amortization of grant date fair value of the Company's stock-based compensation awards. |
|
(2) |
For the three and nine months ended September 30, 2024 and 2023, expenses relate to periodic efforts to enhance efficiencies and reduce costs, and include severance benefits, and costs associated with abandoned facilities and system consolidation. |
|
(3) |
Expenses related to the Keap acquisition during the three and nine months ended September 30, 2024, and the Yellow acquisition during the nine months ended September 30, 2023. |
|
(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 periodic mark-to-market pension remeasurement. |
|
(5) |
In connection with the debt refinancing completed on May 1, 2024, we recorded a Loss on early extinguishment of debt related to the write-off of certain unamortized debt issuance costs on our prior Term Loan and prior ABL Facility. |
|
(6) |
In connection with the YP acquisition, the seller indemnified us 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. |
|
(7) |
Other primarily represents foreign exchange-related expense (income). |
The following tables set forth reconciliations of Adjusted Gross Profit and Adjusted Gross Margin, to their most directly comparable GAAP measures, Gross profit and Gross margin:
|
Three Months Ended September 30, 2024 |
||||||||||
(in thousands) |
Marketing Services |
|
SaaS |
|
Total |
||||||
Reconciliation of Adjusted Gross Profit |
|
|
|
|
|
||||||
Gross profit |
$ |
51,374 |
|
|
$ |
60,607 |
|
|
$ |
111,981 |
|
Plus: |
|
|
|
|
|
||||||
Depreciation and amortization expense |
|
2,508 |
|
|
|
2,189 |
|
|
|
4,697 |
|
Stock-based compensation expense |
|
69 |
|
|
|
92 |
|
|
|
161 |
|
Adjusted Gross Profit |
$ |
53,951 |
|
|
$ |
62,888 |
|
|
$ |
116,839 |
|
Gross Margin |
|
55.4 |
% |
|
|
69.6 |
% |
|
|
62.3 |
% |
Adjusted Gross Margin |
|
58.1 |
% |
|
|
72.2 |
% |
|
|
65.0 |
% |
|
Three Months Ended September 30, 2023 |
||||||||||
(in thousands) |
Marketing Services |
|
SaaS |
|
Total |
||||||
Reconciliation of Adjusted Gross Profit |
|
|
|
|
|
||||||
Gross profit |
$ |
60,776 |
|
|
$ |
42,868 |
|
|
$ |
103,644 |
|
Plus: |
|
|
|
|
|
||||||
Depreciation and amortization expense |
|
4,885 |
|
|
|
1,901 |
|
|
|
6,786 |
|
Stock-based compensation expense |
|
103 |
|
|
|
71 |
|
|
|
174 |
|
Adjusted Gross Profit |
$ |
65,764 |
|
|
$ |
44,840 |
|
|
$ |
110,604 |
|
Gross Margin |
|
52.2 |
% |
|
|
63.6 |
% |
|
|
56.4 |
% |
Adjusted Gross Margin |
|
56.5 |
% |
|
|
66.6 |
% |
|
|
60.2 |
% |
|
Nine Months Ended September 30, 2024 |
||||||||||
(in thousands) |
Marketing Services |
|
SaaS |
|
Total |
||||||
Reconciliation of Adjusted Gross Profit |
|
|
|
|
|
||||||
Gross profit |
$ |
252,219 |
|
|
$ |
161,991 |
|
|
$ |
414,210 |
|
Plus: |
|
|
|
|
|
||||||
Depreciation and amortization expense |
|
10,569 |
|
|
|
5,770 |
|
|
|
16,339 |
|
Stock-based compensation expense |
|
280 |
|
|
|
228 |
|
|
|
508 |
|
Adjusted Gross Profit |
$ |
263,068 |
|
|
$ |
167,989 |
|
|
$ |
431,057 |
|
Gross Margin |
|
63.3 |
% |
|
|
67.7 |
% |
|
|
65.0 |
% |
Adjusted Gross Margin |
|
66.0 |
% |
|
|
70.2 |
% |
|
|
67.6 |
% |
|
Nine Months Ended September 30, 2023 |
||||||||||
(in thousands) |
Marketing Services |
|
SaaS |
|
Total |
||||||
Reconciliation of Adjusted Gross Profit |
|
|
|
|
|
||||||
Gross profit |
$ |
299,305 |
|
|
$ |
119,232 |
|
|
$ |
418,537 |
|
Plus: |
|
|
|
|
|
||||||
Depreciation and amortization expense |
|
16,790 |
|
|
|
4,603 |
|
|
|
21,393 |
|
Stock-based compensation expense |
|
325 |
|
|
|
171 |
|
|
|
496 |
|
Adjusted Gross Profit |
$ |
316,420 |
|
|
$ |
124,006 |
|
|
$ |
440,426 |
|
Gross Margin |
|
61.0 |
% |
|
|
62.8 |
% |
|
|
61.5 |
% |
Adjusted Gross Margin |
|
64.4 |
% |
|
|
65.4 |
% |
|
|
64.7 |
% |
Supplemental Financial Information
The following supplemental financial information provides Revenue, Adjusted EBITDA and Adjusted EBITDA Margin by (i) Marketing Services businesses and (ii) SaaS businesses. Total SaaS Adjusted EBITDA and Adjusted EBITDA margin are non-GAAP financial measures. Total Marketing Services Adjusted EBITDA and Adjusted EBITDA margin are also non-GAAP financial measures. These non-GAAP financial 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 these non-GAAP financial measures to the corresponding segment financial measures presented in accordance with GAAP.
We believe that these non-GAAP financial measures provide useful information about our global SaaS and Marketing Services financial performance, enhance the overall understanding of our global SaaS and Marketing Services past financial performance 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 additional tools for investors to use in comparing our core financial performance over multiple periods.
|
Three Months Ended September 30, 2024 |
||||||||||
(in thousands) |
Marketing Services |
|
SaaS |
|
Total |
||||||
Revenue |
$ |
92,797 |
|
|
$ |
87,055 |
|
|
$ |
179,852 |
|
Net (Loss) |
|
|
|
|
|
(96,071 |
) |
||||
Net (Loss) Margin |
|
|
|
|
|
(53.4 |
)% |
||||
Adjusted EBITDA |
|
9,309 |
|
|
|
10,314 |
|
|
|
19,623 |
|
Adjusted EBITDA Margin |
|
10.0 |
% |
|
|
11.8 |
% |
|
|
10.9 |
% |
|
Three Months Ended September 30, 2023 |
||||||||||
(in thousands) |
Marketing Services |
|
SaaS |
|
Total |
||||||
Revenue |
$ |
116,462 |
|
|
$ |
67,360 |
|
|
$ |
183,822 |
|
Net (Loss) |
|
|
|
|
|
(27,046 |
) |
||||
Net (Loss) Margin |
|
|
|
|
|
(14.7 |
)% |
||||
Adjusted EBITDA |
|
7,835 |
|
|
|
(504 |
) |
|
|
7,331 |
|
Adjusted EBITDA Margin |
|
6.7 |
% |
|
|
(0.7 |
)% |
|
|
4.0 |
% |
|
Nine Months Ended September 30, 2024 |
||||||||||
(in thousands) |
Marketing Services |
|
SaaS |
|
Total |
||||||
Revenue |
$ |
398,389 |
|
|
$ |
239,171 |
|
|
$ |
637,560 |
|
Net (Loss) |
|
|
|
|
|
(82,099 |
) |
||||
Net (Loss) Margin |
|
|
|
|
|
(12.9 |
)% |
||||
Adjusted EBITDA |
|
109,137 |
|
|
|
23,914 |
|
|
|
133,051 |
|
Adjusted EBITDA Margin |
|
27.4 |
% |
|
|
10.0 |
% |
|
|
20.9 |
% |
|
Nine Months Ended September 30, 2023 |
||||||||||
(in thousands) |
Marketing Services |
|
SaaS |
|
Total |
||||||
Revenue |
$ |
491,051 |
|
|
$ |
189,747 |
|
|
$ |
680,798 |
|
Net (Loss) |
|
|
|
|
|
(1,754 |
) |
||||
Net (Loss) Margin |
|
|
|
|
|
(0.3 |
)% |
||||
Adjusted EBITDA |
|
129,717 |
|
|
|
5,522 |
|
|
|
135,239 |
|
Adjusted EBITDA Margin |
|
26.4 |
% |
|
|
2.9 |
% |
|
|
19.9 |
% |
Forward-Looking Statements
Certain statements contained herein are not historical facts, constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and involve a number of risks and uncertainties. Statements that include the words "may", "will", "could", "should", "would", "believe", "anticipate", "forecast", "estimate", "expect", "preliminary", "intend", "plan", "target", "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. These forward-looking statements are based on our current expectations and beliefs concerning future developments and their potential effect on us. While management believes that these forward-looking statements are reasonable as and when made, there can be no assurance that future developments affecting us will be those that we anticipate. 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: 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 as well as the risks and uncertainties set forth in the Company's most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission. 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
Thryv Holdings, Inc. (NASDAQ:THRY) is the provider of the leading do-it-all small business software platform that empowers small businesses to modernize how they work. It offers small business owners everything they need to communicate effectively, manage their day-to-day operations, and grow — all in one place — giving up to 20 hours back in their week. Thryv's customizable platform features three centers: Thryv Command Center, a freemium central communications hub, Business CenterTM and Marketing CenterTM. Approximately 300,000 businesses globally use Thryv to connect with local customers and take care of everything they do, start to finish. For more information, visit thryv.com.
1 Rule of 40 is defined as year-over-year revenue growth plus Adj. EBITDA Margin.
2 Defined as Gross profit adjusted to exclude the impact of depreciation and amortization expense and stock-based compensation expense.
3 Seasoned Net Dollar Retention is defined as net dollar retention excluding clients acquired over the previous 12 months.
4 Defined as total client billings for a particular month divided by the number of clients that have one or more revenue-generating solutions in that same month.
5 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.
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