Blackbaud Announces 2023 Fourth Quarter and Full Year Results
Full Year 2023 Financial Results Met or Exceeded Financial Guidance Ranges; Blackbaud Announces Refreshed Capital Allocation Strategy
"The fourth quarter concluded a year of substantial transformation for Blackbaud," said
Fourth Quarter 2023 Results Compared to Fourth Quarter 2022 Results:
- GAAP total revenue was
$295.0 million , up 7.4%, with$287.4 million in GAAP recurring revenue, up 8.4%. GAAP recurring revenue was 97% of total revenue. - Non-GAAP organic recurring revenue increased 8.4%.
- GAAP income from operations was
$32.3 million , inclusive of security incident-related costs of$4.8 million , with GAAP operating margin of 11.0%, an increase of 1,670 basis points. - Non-GAAP income from operations was
$83.8 million , with non-GAAP operating margin of 28.4%, an increase of 840 basis points. - GAAP net income was
$5.4 million , with GAAP diluted earnings per share of$0.10 , up$0.51 per share. - Non-GAAP net income was
$62.2 million , with non-GAAP diluted earnings per share of$1.14 , up$0.46 per share. - Non-GAAP adjusted EBITDA was
$99.3 million , up$31.3 million , with non-GAAP adjusted EBITDA margin of 33.6%, an increase of 890 basis points. - GAAP net cash used in operating activities was
$(3.3) million , inclusive of security incident-related payments of$54.9 million . GAAP net cash used in operating activities decreased$17.4 million and GAAP operating cash flow margin was (1.1)%, a decrease of 620 basis points. - Non-GAAP free cash flow was
$(18.6) million , inclusive of security incident-related payments of$54.9 million . Non-GAAP free cash flow decreased$14.9 million and non-GAAP free cash flow margin was (6.3)%, a decrease of 500 basis points. - Non-GAAP adjusted free cash flow was
$36.3 million , an increase of$28.7 million , with non-GAAP adjusted free cash flow margin of 12.3%, an increase of 950 basis points.
"The fourth quarter demonstrated continued progress on our five-point operating plan, which has transformed our financial results," said
An explanation of all non-GAAP financial measures referenced in this press release, including the Rule of 40, is included below under the heading "Non-GAAP Financial Measures." A reconciliation of the company's non-GAAP financial measures to their most directly comparable GAAP measures has been provided in the financial statement tables included below in this press release.
Recent Company Highlights
- Blackbaud released Prospect Insights Pro for Blackbaud Raiser's Edge NXT®, supporting advanced fundraising organizations with more AI-driven recommendations, including planned gift likelihood and detailed wealth and asset data.
- Blackbaud announced the newest cohort of its Social Good Startup Program, welcoming eight new startups that are bringing cutting edge technology to the social impact sector.
- In the TrustRadius 2023 "Best Of" Awards, Blackbaud Raiser's Edge NXT® and Blackbaud Financial Edge NXT® were recognized for Best Value, Best Feature Set and Best Relationship.
- Newsweek honored Blackbaud on its Excellence 1000 2024 Index, as well as its list of America's Most Responsible Companies for the third consecutive year, recognizing the company's commitment to social responsibility.
- Blackbaud was named Corporate Governance Team of the Year in the small-mid cap category at the 2023 Corporate Governance Awards, hosted by Governance Intelligence. The awards recognize outstanding achievements in governance, risk and compliance.
- Blackbaud appointed
Kristian Talvitie , executive vice president and CFO of PTC Inc., to its board of directors. Talvitie brings 30 years of experience with a diverse background ranging across corporate finance, FP&A, sales, marketing and communications. - Blackbaud announced a reauthorized, expanded and replenished
$500M stock repurchase program. about Blackbaud's recent highlights.
Visit www.blackbaud.com/newsroom for more information about Blackbaud's recent highlights.
Full-Year 2023 Results Compared to Full-Year 2022 Results:
- GAAP total revenue was
$1.1 billion , up 4.5%, with$1.1 billion in GAAP recurring revenue, up 5.9%. - Non-GAAP organic recurring revenue increased 6.3%.
- GAAP income from operations was
$44.7 million , inclusive of security incident-related costs of$53.4 million , with GAAP operating margin of 4.0%, an increase of 670 basis points. - Non-GAAP income from operations was
$294.1 million , with non-GAAP operating margin of 26.6%, an increase of 750 basis points. - GAAP net income was
$1.8 million , with GAAP diluted earnings per share of$0.03 , up$0.91 per share. - Non-GAAP net income was
$213.6 million , with non-GAAP diluted earnings per share of$3.98 , up$1.29 per share. - Non-GAAP adjusted EBITDA was
$356.5 million , up$93.9 million , with non-GAAP adjusted EBITDA margin of 32.2%, an increase of 740 basis points. - GAAP net cash provided by operating activities was
$199.6 million , inclusive of security incident-related payments of$78.0 million . GAAP net cash provided by operating activities decreased$4.3 million and GAAP operating cash flow margin was 18.1%, a decrease of 120 basis points. - Non-GAAP free cash flow was
$135.5 million , inclusive of security incident-related payments of$78.0 million . Non-GAAP free cash flow increased$2.7 million and non-GAAP free cash flow margin of 12.3%, a decrease of 30 basis points. - Non-GAAP adjusted free cash flow was
$213.5 million , an increase of$59.8 million , with non-GAAP adjusted free cash flow margin of 19.3%, an increase of 480 basis points.
Financial Outlook
Blackbaud today announced its 2024 full year financial guidance:
- Non-GAAP revenue of
$1.170 billion to$1.200 billion - Non-GAAP adjusted EBITDA margin of 32.5% to 33.5%
- Non-GAAP earnings per share of
$4.12 to$4.38 - Non-GAAP adjusted free cash flow of
$254 million to$274 million
Included in its 2024 full year financial guidance are the following assumptions:
- Non-GAAP annualized effective tax rate is expected to be approximately 24.5%
- Interest expense for the year is expected to be approximately
$34 million to$38 million - Fully diluted shares for the year are expected to be approximately 53.5 million to 54.5 million
- Capital expenditures for the year are expected to be approximately
$65 million to$75 million , including approximately$60 million to$70 million of capitalized software and content development costs
Blackbaud has not reconciled forward-looking full-year non-GAAP financial measures contained in this news release to their most directly comparable GAAP measures, as permitted by Item 10(e)(1)(i)(B) of Regulation S-K. Such reconciliations would require unreasonable efforts at this time to estimate and quantify with a reasonable degree of certainty various necessary GAAP components, including for example those related to compensation, acquisition transactions and integration, tax items or others that may arise during the year. These components and other factors could materially impact the amount of the future directly comparable GAAP measures, which may differ significantly from their non-GAAP counterparts.
In order to provide a meaningful basis for comparison, Blackbaud uses non-GAAP adjusted free cash flow in analyzing its operating performance. Non-GAAP adjusted free cash flow is defined as operating cash flow less capital expenditures, including costs required to be capitalized for software and content development, capital expenditures for property and equipment, plus cash outflows, net of insurance, related to the previously disclosed Security Incident discovered in
Stock Repurchase Program
As of
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Conference Call Details |
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What: |
Blackbaud's Fourth Quarter and Full Year 2023 Conference Call |
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When: |
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Time: |
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Live Call: |
1-877-407-3088 (US/ |
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Webcast: |
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About Blackbaud
Blackbaud (NASDAQ: BLKB) is the leading software provider exclusively dedicated to powering social impact. Serving the nonprofit and education sectors, companies committed to social responsibility and individual change makers, Blackbaud's essential software is built to accelerate impact in fundraising, nonprofit financial management, digital giving, grantmaking, corporate social responsibility and education management. With millions of users and over
Investor Contact
IR@blackbaud.com
Media Contact
media@blackbaud.com
Forward-Looking Statements
Except for historical information, all of the statements, expectations, and assumptions contained in this news release are forward-looking statements which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements regarding the predictability of our financial condition and results of operations. These statements involve a number of risks and uncertainties. Although Blackbaud attempts to be accurate in making these forward-looking statements, it is possible that future circumstances might differ from the assumptions on which such statements are based. In addition, other important factors that could cause results to differ materially include the following: management of integration of acquired companies; uncertainty regarding increased business and renewals from existing customers; a shifting revenue mix that may impact gross margin; continued success in sales growth; cybersecurity and data protection risks and related liabilities; potential litigation involving us; and the other risk factors set forth from time to time in the
Trademarks
All Blackbaud product names appearing herein are trademarks or registered trademarks of
Non-GAAP Financial Measures
Blackbaud has provided in this release financial information that has not been prepared in accordance with GAAP. Blackbaud uses non-GAAP financial measures internally in analyzing its operational performance. Accordingly, Blackbaud believes these non-GAAP measures are useful to investors, as a supplement to GAAP measures, in evaluating its ongoing operational performance and trends and in comparing its financial results from period-to-period with other companies in Blackbaud's industry, many of which present similar non-GAAP financial measures to investors. However, these non-GAAP financial measures may not be completely comparable to similarly titled measures of other companies due to potential differences in the exact method of calculation between companies.
The non-GAAP financial measures discussed above exclude the impact of certain transactions that Blackbaud believes are not directly related to its operating performance in any particular period, but are for its long-term benefit over multiple periods. Blackbaud believes these non-GAAP financial measures reflect its ongoing business in a manner that allows for meaningful period-to-period comparisons and analysis of trends in its business.
While Blackbaud believes these non-GAAP measures provide useful supplemental information, non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Investors are encouraged to review the reconciliations of these non-GAAP measures to their most directly comparable GAAP financial measures.
Beginning in 2024, we intend to update the non-GAAP tax rate we apply when calculating non-GAAP net income and non-GAAP diluted earnings per share in future periods. Since the first quarter of 2018, for the purposes of determining non-GAAP net income, we have utilized a non-GAAP tax rate of 20.0% in our calculation of the assumed non-GAAP income tax provision. We intend to adjust this rate to 24.5% to better reflect our periodic effective tax rate calculated in accordance with GAAP and our current expectations. The increase in our non-GAAP tax rate is primarily driven by increases in income tax rates in jurisdictions we operate in. Furthermore, as profitability increases, the effect of tax impacting items, including research and development credits, lessens such that our assumed non-GAAP tax rate moves closer to the statutory rate. The non-GAAP tax rate utilized in future periods will be reviewed annually to determine whether it remains appropriate in consideration of our financial results including our periodic effective tax rate calculated in accordance with GAAP, our operating environment and related tax legislation in effect and other factors deemed necessary. All fourth quarter and full year 2023 measures of the tax impact related to non-GAAP net income and non-GAAP diluted earnings per share included in this news release are calculated under Blackbaud's historical methodology.
Non-GAAP free cash flow is defined as operating cash flow less capital expenditures, including costs required to be capitalized for software and content development, and capital expenditures for property and equipment. In addition, and in order to provide a meaningful basis for comparison, Blackbaud now uses non-GAAP adjusted free cash flow in analyzing its operating performance. Non-GAAP adjusted free cash flow is defined as operating cash flow less capital expenditures, including costs required to be capitalized for software and content development, and capital expenditures for property and equipment, plus cash outflows, net of insurance, related to the Security Incident. Blackbaud believes non-GAAP free cash flow and non-GAAP adjusted free cash flow provide useful measures of the company's operating performance. Non-GAAP adjusted free cash flow is not intended to represent and should not be viewed as the amount of residual cash flow available for discretionary expenditures.
In addition, Blackbaud uses non-GAAP organic revenue growth, non-GAAP organic revenue growth on a constant currency basis, non-GAAP organic recurring revenue growth and non-GAAP organic recurring revenue growth on a constant currency basis, in analyzing its operating performance. Blackbaud believes that these non-GAAP measures are useful to investors, as a supplement to GAAP measures, for evaluating the periodic growth of its business on a consistent basis. Each of these measures excludes incremental acquisition-related revenue attributable to companies acquired in the current fiscal year. For companies acquired in the immediately preceding fiscal year, each of these measures reflects presentation of full-year incremental non-GAAP revenue derived from such companies as if they were combined throughout the prior period. In addition, each of these measures excludes prior period revenue associated with divested businesses. The exclusion of the prior period revenue is to present the results of the divested businesses within the results of the combined company for the same period of time in both the prior and current periods. Blackbaud believes this presentation provides a more comparable representation of its current business' organic revenue growth and revenue run-rate.
Rule of 40 is defined as non-GAAP organic revenue growth plus non-GAAP adjusted EBITDA margin. Non-GAAP adjusted EBITDA is defined as GAAP net income plus interest, net; income tax provision (benefit); depreciation; amortization of intangible assets from business combinations; amortization of software and content development costs; stock-based compensation; employee severance; acquisition and disposition-related costs; restructuring and other real estate activities; costs, net of insurance, related to the Security Incident; and impairment of capitalized software development costs.
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Consolidated Balance Sheets (Unaudited) |
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(dollars in thousands, except per share amounts) |
|
|
|
Assets |
||
|
Current assets: |
||
|
Cash and cash equivalents |
$ 31,251 |
$ 31,691 |
|
Restricted cash |
697,006 |
702,240 |
|
Accounts receivable, net of allowance of |
101,862 |
102,809 |
|
Customer funds receivable |
353 |
249 |
|
Prepaid expenses and other current assets |
99,285 |
81,654 |
|
Total current assets |
929,757 |
918,643 |
|
Property and equipment, net |
98,689 |
107,426 |
|
Operating lease right-of-use assets |
36,927 |
45,899 |
|
Software and content development costs, net |
160,194 |
141,023 |
|
|
1,053,738 |
1,050,272 |
|
Intangible assets, net |
581,937 |
635,136 |
|
Other assets |
51,037 |
94,304 |
|
Total assets |
$ 2,912,279 |
$ 2,992,703 |
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Liabilities and stockholders' equity |
||
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Current liabilities: |
||
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Trade accounts payable |
$ 25,184 |
$ 42,559 |
|
Accrued expenses and other current liabilities |
64,322 |
86,002 |
|
Due to customers |
695,842 |
700,860 |
|
Debt, current portion |
19,259 |
18,802 |
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Deferred revenue, current portion |
392,530 |
382,419 |
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Total current liabilities |
1,197,137 |
1,230,642 |
|
Debt, net of current portion |
760,405 |
840,241 |
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Deferred tax liability |
93,292 |
125,759 |
|
Deferred revenue, net of current portion |
2,397 |
2,817 |
|
Operating lease liabilities, net of current portion |
40,085 |
44,918 |
|
Other liabilities |
10,258 |
4,294 |
|
Total liabilities |
2,103,574 |
2,248,671 |
|
Commitments and contingencies |
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Stockholders' equity: |
||
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Preferred stock; 20,000,000 shares authorized, none outstanding |
— |
— |
|
Common stock, |
69 |
68 |
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Additional paid-in capital |
1,203,012 |
1,075,264 |
|
|
(591,557) |
(537,287) |
|
Accumulated other comprehensive (loss) income |
(1,688) |
8,938 |
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Retained earnings |
198,869 |
197,049 |
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Total stockholders' equity |
808,705 |
744,032 |
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Total liabilities and stockholders' equity |
$ 2,912,279 |
$ 2,992,703 |
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Consolidated Statements of Comprehensive Loss (Unaudited) |
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(dollars in thousands, except per share amounts) |
Three months ended |
Years ended |
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2023 |
2022 |
2023 |
2022 |
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Revenue |
|||||
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Recurring |
$ 287,381 |
$ 265,173 |
$ 1,071,520 |
$ 1,011,733 |
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One-time services and other |
7,630 |
9,584 |
33,912 |
46,372 |
|
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Total revenue |
295,011 |
274,757 |
1,105,432 |
1,058,105 |
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Cost of revenue |
|||||
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Cost of recurring |
127,897 |
125,300 |
470,455 |
463,449 |
|
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Cost of one-time services and other |
7,938 |
10,183 |
31,733 |
41,940 |
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Total cost of revenue |
135,835 |
135,483 |
502,188 |
505,389 |
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Gross profit |
159,176 |
139,274 |
603,244 |
552,716 |
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Operating expenses |
|||||
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Sales, marketing and customer success |
52,120 |
57,088 |
212,158 |
221,455 |
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Research and development |
38,602 |
38,177 |
153,304 |
156,913 |
|
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General and administrative |
35,356 |
58,895 |
189,938 |
199,908 |
|
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Amortization |
784 |
662 |
3,139 |
2,925 |
|
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Total operating expenses |
126,862 |
154,822 |
558,539 |
581,201 |
|
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Income (loss) from operations |
32,314 |
(15,548) |
44,705 |
(28,485) |
|
|
Interest expense |
(8,473) |
(9,891) |
(39,922) |
(35,803) |
|
|
Other income, net |
2,414 |
5 |
12,861 |
8,713 |
|
|
Income (loss) before provision (benefit) for income taxes |
26,255 |
(25,434) |
17,644 |
(55,575) |
|
|
Income tax provision (benefit) |
20,856 |
(4,175) |
15,824 |
(10,168) |
|
|
Net income (loss) |
$ 5,399 |
$ (21,259) |
$ 1,820 |
$ (45,407) |
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|
Earnings (loss) per share |
|||||
|
Basic |
$ 0.10 |
$ (0.41) |
$ 0.03 |
$ (0.88) |
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Diluted |
$ 0.10 |
$ (0.41) |
$ 0.03 |
$ (0.88) |
|
|
Common shares and equivalents outstanding |
|||||
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Basic weighted average shares |
52,697,294 |
51,716,948 |
52,546,406 |
51,569,148 |
|
|
Diluted weighted average shares |
54,439,689 |
51,716,948 |
53,721,342 |
51,569,148 |
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Other comprehensive (loss) income |
|||||
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Foreign currency translation adjustment |
$ 4,630 |
$ 7,906 |
$ 5,049 |
$ (16,160) |
|
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Unrealized (loss) gain on derivative instruments, net of tax |
(14,459) |
(1,684) |
(15,675) |
18,576 |
|
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Total other comprehensive (loss) income |
(9,829) |
6,222 |
(10,626) |
2,416 |
|
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Comprehensive loss |
$ (4,430) |
$ (15,037) |
$ (8,806) |
$ (42,991) |
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Consolidated Statements of Cash Flows (Unaudited) |
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Years ended |
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(dollars in thousands) |
2023 |
2022 |
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Cash flows from operating activities |
||
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Net income (loss) |
$ 1,820 |
$ (45,407) |
|
Adjustments to reconcile net income (loss) to net cash provided by operating activities: |
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Depreciation and amortization |
109,487 |
102,369 |
|
Provision for credit losses and sales returns |
4,500 |
6,066 |
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Stock-based compensation expense |
127,762 |
110,294 |
|
Deferred taxes |
(24,368) |
(26,644) |
|
Amortization of deferred financing costs and discount |
1,775 |
2,364 |
|
Other non-cash adjustments |
5,023 |
5,676 |
|
Changes in operating assets and liabilities, net of acquisition and disposal of businesses: |
||
|
Accounts receivable |
(3,237) |
(7,340) |
|
Prepaid expenses and other assets |
16,851 |
26,235 |
|
Trade accounts payable |
(18,576) |
21,607 |
|
Accrued expenses and other liabilities |
(30,275) |
(2,386) |
|
Deferred revenue |
8,872 |
11,059 |
|
Net cash provided by operating activities |
199,634 |
203,893 |
|
Cash flows from investing activities |
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Purchase of property and equipment |
(4,685) |
(12,289) |
|
Capitalized software and content development costs |
(59,443) |
(58,774) |
|
Purchase of net assets of acquired companies, net of cash and restricted cash acquired |
(13) |
(20,912) |
|
Cash received in sale of business |
— |
6,426 |
|
Other investing activities |
(250) |
— |
|
Net cash used in investing activities |
(64,391) |
(85,549) |
|
Cash flows from financing activities |
||
|
Proceeds from issuance of debt |
293,200 |
211,000 |
|
Payments on debt |
(374,595) |
(310,740) |
|
Stock issuance costs |
— |
(1,339) |
|
Employee taxes paid for withheld shares upon equity award settlement |
(35,867) |
(36,376) |
|
Change in due to customers |
(6,812) |
111,386 |
|
Change in customer funds receivable |
(60) |
380 |
|
Purchase of treasury stock |
(18,831) |
— |
|
Net cash used in financing activities |
(142,965) |
(25,689) |
|
Effect of exchange rate on cash, cash equivalents and restricted cash |
2,048 |
(10,486) |
|
Net (decrease) increase in cash, cash equivalents and restricted cash |
(5,674) |
82,169 |
|
Cash, cash equivalents and restricted cash, beginning of year |
733,931 |
651,762 |
|
Cash, cash equivalents and restricted cash, end of year |
$ 728,257 |
$ 733,931 |
The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown above in the consolidated statements of cash flows:
|
(dollars in thousands) |
|
|
|
Cash and cash equivalents |
$ 31,251 |
$ 31,691 |
|
Restricted cash |
697,006 |
702,240 |
|
Total cash, cash equivalents and restricted cash in the statement of cash flows |
$ 728,257 |
$ 733,931 |
|
Reconciliation of GAAP to Non-GAAP Financial Measures (Unaudited) |
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(dollars in thousands, except per share amounts) |
Three months ended |
Years ended |
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2023 |
2022 |
2023 |
2022 |
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GAAP Revenue |
$ 295,011 |
$ 274,757 |
|
|
|
|
GAAP gross profit |
$ 159,176 |
$ 139,274 |
$ 603,244 |
$ 552,716 |
|
|
GAAP gross margin |
54.0 % |
50.7 % |
54.6 % |
52.2 % |
|
|
Non-GAAP adjustments: |
|||||
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Add: Stock-based compensation expense |
4,416 |
3,109 |
16,658 |
14,436 |
|
|
Add: Amortization of intangibles from business combinations |
13,099 |
11,686 |
52,463 |
48,492 |
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Add: Employee severance |
— |
1,787 |
797 |
2,135 |
|
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Subtotal |
17,515 |
16,582 |
69,918 |
65,063 |
|
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Non-GAAP gross profit |
$ 176,691 |
$ 155,856 |
$ 673,162 |
$ 617,779 |
|
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Non-GAAP gross margin |
59.9 % |
56.7 % |
60.9 % |
58.4 % |
|
|
GAAP income (loss) from operations |
$ 32,314 |
$ (15,548) |
$ 44,705 |
$ (28,485) |
|
|
GAAP operating margin |
11.0 % |
(5.7) % |
4.0 % |
(2.7) % |
|
|
Non-GAAP adjustments: |
|||||
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Add: Stock-based compensation expense |
32,094 |
26,635 |
127,762 |
110,294 |
|
|
Add: Amortization of intangibles from business combinations |
13,883 |
12,348 |
55,602 |
51,417 |
|
|
Add: Employee severance |
55 |
4,470 |
5,149 |
5,164 |
|
|
Add: Acquisition and disposition-related costs(1)(2) |
657 |
430 |
7,456 |
6,135 |
|
|
Add: Restructuring and other real estate activities |
— |
— |
— |
71 |
|
|
Add: Security Incident-related costs, net of insurance(3) |
4,780 |
26,516 |
53,426 |
55,723 |
|
|
Add: Impairment of capitalized software development costs |
— |
— |
— |
2,263 |
|
|
Subtotal |
51,469 |
70,399 |
249,395 |
231,067 |
|
|
Non-GAAP income from operations |
$ 83,783 |
$ 54,851 |
$ 294,100 |
$ 202,582 |
|
|
Non-GAAP operating margin |
28.4 % |
20.0 % |
26.6 % |
19.1 % |
|
|
GAAP income (loss) before provision (benefit) for income taxes |
$ 26,255 |
$ (25,434) |
$ 17,644 |
$ (55,575) |
|
|
GAAP net income (loss) |
$ 5,399 |
$ (21,259) |
$ 1,820 |
$ (45,407) |
|
|
Shares used in computing GAAP diluted earnings (loss) per share |
54,439,689 |
51,716,948 |
53,721,342 |
51,569,148 |
|
|
GAAP diluted earnings (loss) per share |
$ 0.10 |
$ (0.41) |
$ 0.03 |
$ (0.88) |
|
|
Non-GAAP adjustments: |
|||||
|
Add: GAAP income tax provision (benefit) |
20,856 |
(4,175) |
15,824 |
(10,168) |
|
|
Add: Total non-GAAP adjustments affecting income from operations |
51,469 |
70,399 |
249,395 |
231,067 |
|
|
Non-GAAP income before provision for income taxes |
77,724 |
44,965 |
267,039 |
175,492 |
|
|
Assumed non-GAAP income tax provision(4) |
15,545 |
8,993 |
53,408 |
35,098 |
|
|
Non-GAAP net income |
$ 62,179 |
$ 35,972 |
$ 213,631 |
$ 140,394 |
|
|
Shares used in computing non-GAAP diluted earnings per share |
54,439,689 |
52,923,158 |
53,721,342 |
52,207,573 |
|
|
Non-GAAP diluted earnings per share |
$ 1.14 |
$ 0.68 |
$ 3.98 |
$ 2.69 |
|
|
(1) |
Includes a |
|
(2) |
Includes noncash impairment charges incurred during the twelve months ended |
|
(3) |
Includes Security Incident-related costs incurred during the three and twelve months ended |
|
(4) |
Blackbaud applies a non-GAAP effective tax rate of 20.0% when calculating non-GAAP net income and non-GAAP diluted earnings per share. |
|
Reconciliation of GAAP to Non-GAAP Financial Measures (continued) (Unaudited) |
|||||
|
(dollars in thousands) |
Three months ended |
Years ended |
|||
|
2023 |
2022 |
2023 |
2022 |
||
|
GAAP revenue |
$ 295,011 |
$ 274,757 |
|
$ 1,058,105 |
|
|
GAAP revenue growth |
7.4 % |
4.5 % |
|||
|
Less: Non-GAAP revenue from divested businesses(1) |
— |
(10) |
— |
(3,535) |
|
|
Non-GAAP organic revenue(2) |
$ 295,011 |
$ 274,747 |
|
$ 1,054,570 |
|
|
Non-GAAP organic revenue growth |
7.4 % |
4.8 % |
|||
|
Non-GAAP organic revenue(2) |
$ 295,011 |
$ 274,747 |
|
$ 1,054,570 |
|
|
Foreign currency impact on non-GAAP organic revenue(3) |
(1,284) |
— |
431 |
— |
|
|
Non-GAAP organic revenue on constant currency basis(3) |
$ 293,727 |
$ 274,747 |
|
$ 1,054,570 |
|
|
Non-GAAP organic revenue growth on constant currency basis |
6.9 % |
4.9 % |
|||
|
GAAP recurring revenue |
$ 287,381 |
$ 265,173 |
|
$ 1,011,733 |
|
|
GAAP recurring revenue growth |
8.4 % |
5.9 % |
|||
|
Less: Non-GAAP recurring revenue from divested businesses(1) |
— |
(1) |
— |
(3,439) |
|
|
Non-GAAP organic recurring revenue(2) |
$ 287,381 |
$ 265,172 |
|
$ 1,008,294 |
|
|
Non-GAAP organic recurring revenue growth |
8.4 % |
6.3 % |
|||
|
Non-GAAP organic recurring revenue(2) |
$ 287,381 |
$ 265,172 |
|
$ 1,008,294 |
|
|
Foreign currency impact on non-GAAP organic recurring revenue(3) |
(1,157) |
— |
482 |
— |
|
|
Non-GAAP organic recurring revenue on constant currency basis(3) |
$ 286,224 |
$ 265,172 |
|
$ 1,008,294 |
|
|
Non-GAAP organic recurring revenue growth on constant |
7.9 % |
6.3 % |
|||
|
(1) |
Non-GAAP revenue from divested businesses excludes revenue associated with divested businesses. The exclusion of the prior period revenue is to present the results of the divested business with the results of the combined company for the same period of time in both the prior and current periods. |
|
(2) |
Non-GAAP organic revenue and non-GAAP organic recurring revenue for the prior year periods presented herein may not agree to non-GAAP organic revenue and non-GAAP organic recurring revenue presented in the respective prior period quarterly financial information solely due to the manner in which non-GAAP organic revenue growth and non-GAAP organic recurring revenue growth are calculated. |
|
(3) |
To determine non-GAAP organic revenue growth and non-GAAP organic recurring revenue growth on a constant currency basis, revenues from entities reporting in foreign currencies were translated to |
|
Reconciliation of GAAP to Non-GAAP Financial Measures (continued) (Unaudited) |
|||||
|
(dollars in thousands) |
Three months ended |
Years ended |
|||
|
2023 |
2022 |
2023 |
2022 |
||
|
GAAP net income (loss) |
$ 5,399 |
$ (21,259) |
$ 1,820 |
$ (45,407) |
|
|
Non-GAAP adjustments: |
|||||
|
Add: Interest, net |
6,208 |
9,053 |
31,101 |
34,057 |
|
|
Add: GAAP income tax provision (benefit) |
20,856 |
(4,175) |
15,824 |
(10,168) |
|
|
Add: Depreciation |
3,142 |
3,444 |
13,043 |
14,086 |
|
|
Add: Amortization of intangibles from business combinations |
13,883 |
12,348 |
55,602 |
51,417 |
|
|
Add: Amortization of software and content development costs(1) |
12,183 |
10,447 |
45,296 |
38,975 |
|
|
Subtotal |
56,272 |
31,117 |
160,866 |
128,367 |
|
|
Non-GAAP EBITDA |
$ 61,671 |
$ 9,858 |
$ 162,686 |
$ 82,960 |
|
|
Non-GAAP EBITDA margin(2) |
20.9 % |
14.7 % |
|||
|
Non-GAAP adjustments: |
|||||
|
Add: Stock-based compensation expense |
32,094 |
26,635 |
127,762 |
110,294 |
|
|
Add: Employee severance |
55 |
4,470 |
5,149 |
5,164 |
|
|
Add: Acquisition and disposition-related costs(3) |
657 |
430 |
7,456 |
6,135 |
|
|
Add: Restructuring and other real estate activities |
— |
— |
— |
71 |
|
|
Add: Security Incident-related costs, net of insurance(3) |
4,780 |
26,516 |
53,426 |
55,723 |
|
|
Add: Impairment of capitalized software development costs |
— |
— |
— |
2,263 |
|
|
Subtotal |
37,586 |
58,051 |
193,793 |
179,650 |
|
|
Non-GAAP adjusted EBITDA |
$ 99,257 |
$ 67,909 |
$ 356,479 |
$ 262,610 |
|
|
Non-GAAP adjusted EBITDA margin(4) |
33.6 % |
32.2 % |
|||
|
Rule of 40(5) |
41.0 % |
37.0 % |
|||
|
Non-GAAP adjusted EBITDA |
99,257 |
67,909 |
356,479 |
262,610 |
|
|
Foreign currency impact on Non-GAAP adjusted EBITDA(6) |
(716) |
1,326 |
(7) |
6,305 |
|
|
Non-GAAP adjusted EBITDA on constant currency basis(6) |
$ 98,541 |
$ 69,235 |
$ 356,472 |
$ 268,915 |
|
|
Non-GAAP adjusted EBITDA margin on constant currency basis |
33.5 % |
32.2 % |
|||
|
Rule of 40 on constant currency basis(7) |
40.4 % |
37.1 % |
|||
|
(1) |
Includes amortization expense related to software and content development costs, and amortization expense from capitalized cloud computing implementation costs. |
|
(2) |
Measured by GAAP revenue divided by non-GAAP EBITDA. |
|
(3) |
See additional details in the reconciliation of GAAP to Non-GAAP operating income above. |
|
(4) |
Measured by non-GAAP organic revenue divided by non-GAAP adjusted EBITDA. |
|
(5) |
Measured by non-GAAP organic revenue growth plus non-GAAP adjusted EBITDA margin. See Non-GAAP organic revenue growth table above. |
|
(6) |
To determine non-GAAP adjusted EBITDA on a constant currency basis, non-GAAP adjusted EBITDA from entities reporting in foreign currencies were translated to |
|
(7) |
Measured by non-GAAP organic revenue growth on constant currency basis plus non-GAAP adjusted EBITDA margin on constant currency basis. |
|
Reconciliation of GAAP to Non-GAAP Financial Measures (continued) (Unaudited) |
||
|
(dollars in thousands) |
Years ended |
|
|
2023 |
2022 |
|
|
GAAP net cash provided by operating activities |
$ 199,634 |
$ 203,893 |
|
GAAP operating cash flow margin |
18.1 % |
19.3 % |
|
Non-GAAP adjustments: |
||
|
Less: purchase of property and equipment |
(4,685) |
(12,289) |
|
Less: capitalized software and content development costs |
(59,443) |
(58,774) |
|
Non-GAAP free cash flow |
$ 135,506 |
$ 132,830 |
|
Non-GAAP free cash flow margin |
12.3 % |
12.6 % |
|
Non-GAAP adjustments: |
||
|
Add: Security Incident-related cash flows, net of insurance |
78,010 |
20,864 |
|
Non-GAAP adjusted free cash flow |
$ 213,516 |
$ 153,694 |
|
Non-GAAP adjusted free cash flow margin |
19.3 % |
14.5 % |
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SOURCE Blackbaud