-- Reaffirms full year 2020 and 2021 outlook --
LONDON, Nov. 25, 2020 /PRNewswire/ -- Clarivate Plc
(NYSE: CCC), a global leader in providing trusted information and
insights to accelerate the pace of innovation, announced today its
2021 Adjusted diluted earnings per share ("Adjusted
EPS")1 outlook of $0.73 to
$0.79. The Company previously
provided its full year 2021 outlook at its November 10, 2020 Virtual Investor Day except for
Adjusted EPS because it was still evaluating the tax impact of the
CPA Global acquisition on Adjusted EPS.
Outlook for 2020 and 2021 (forward-looking statement)
The full year 2020 outlook presented below includes the fourth
quarter of 2020 outlook for the acquisition of CPA Global, which
was completed on October 1, 2020, and
assumes no further currency movements, acquisitions, divestitures,
or unanticipated events.
The Company has also presented below the full year 2020 outlook
including the fourth quarter acquisition of CPA Global but
excluding the full year 2020 financial results for Techstreet,
which was divested on November 6,
2020. The 2020 outlook excluding Techstreet removes the full
year 2020 projections of $58.0
million of revenue, $11
million of EBITDA and $10
million of free cash flow. Prior to its divestiture,
Techstreet's revenue for the first 10 months of 2020 was
approximately $49 million and EBITDA
of $9 million.
The below outlook includes Non-GAAP measures. Please see
"Reconciliation to Certain Non-GAAP measures" presented below for
important disclosure and reconciliations of these financial
measures to the most directly comparable GAAP measure. These terms
are defined elsewhere in this press release.
|
2020 Outlook
including
fourth quarter of CPA
Global
|
2020 Outlook
including
fourth quarter of CPA
Global but excluding the full
year of Techstreet2
|
2021
Outlook
|
Adjusted
Revenues
|
$1.28B to
$1.295B
|
$1.222B to
$1.237B
|
$1.78B to
$1.84B
|
Adjusted
EBITDA
|
$480M to
$495M
|
$469M to
$484M
|
$785M to
$825M
|
Adjusted EBITDA
margin
|
37% to 38%
|
38% to 39%
|
44% to 45%
|
Adjusted diluted
EPS
|
$0.55 to
$0.61
|
$0.55 to
$0.61
|
$0.73 to
$0.79
|
Adjusted Free Cash
Flow
|
$240M to
$260M
|
$230M to
$250M
|
$450M to
$500M
|
Adjusted diluted EPS for 2020 is calculated based on
approximately 453.3 million fully diluted weighted average shares
outstanding. In connection with the closing of the CPA Global
transaction, former CPA Global shareholders received approximately
218 million Clarivate ordinary shares on October 1. The 453.3 million fully diluted
weighted average shares outstanding includes the fourth quarter
weighted average of the approximately 218 million shares issued in
the full year share calculation.
Average diluted EPS for 2021 is calculated based on
approximately 631.0 million fully diluted weighted average shares
outstanding and includes the full year impact of the ordinary
shares issued in conjunction with the CPA Global transaction.
Use of Non-GAAP Financial Measures
Non-GAAP results are not presentations made in accordance with
U.S. generally accepted accounting principles ("GAAP") and are
presented only as a supplement to our financial statements based on
GAAP. Non-GAAP financial information is provided to enhance the
reader's understanding of our financial performance, but none of
these non-GAAP financial measures are recognized terms under
GAAP. They are not measures of financial condition or
liquidity, and should not be considered as an alternative to profit
or loss for the period determined in accordance with GAAP or
operating cash flows determined in accordance with GAAP. As a
result, you should not consider such measures in isolation from, or
as a substitute for, financial measures or results of operations
calculated or determined in accordance with GAAP.
We use non-GAAP measures in our operational and financial
decision-making. We believe that such measures allow us to focus on
what we deem to be a more reliable indicator of ongoing operating
performance and our ability to generate cash flow from operations
and we also believe that investors may find these non-GAAP
financial measures useful for the same reasons. Non-GAAP measures
are frequently used by securities analysts, investors, and other
interested parties in their evaluation of companies comparable to
us, many of which present non-GAAP measures when reporting their
results. These measures can be useful in evaluating our performance
against our peer companies because we believe the measures provide
users with valuable insight into key components of GAAP financial
disclosures. However, non-GAAP measures have limitations as
analytical tools and because not all companies use identical
calculations, our presentation of non-GAAP financial measures may
not be comparable to other similarly titled measures of other
companies.
Definitions and reconciliations of non-GAAP measures, such as
Adjusted Revenues, EBITDA, Adjusted EBITDA, Adjusted Net Income,
Adjusted Diluted EPS, Free Cash Flow, Adjusted Free Cash Flow, and
Standalone Adjusted EBITDA and net debt to the most directly
comparable GAAP measures are provided within the schedules attached
to this release. Our presentation of non-GAAP measures should
not be construed as an inference that our future results will be
unaffected by any of the adjusted items, or that any projections
and estimates will be realized in their entirety or at
all.
Forward-Looking Statements
This communication contains
"forward-looking statements" as defined in the Private Securities
Litigation Reform Act of 1995. These statements, which express
management's current views concerning future business, events,
trends, contingencies, financial performance, or financial
condition, appear at various places in this communication and may
use words like "aim," "anticipate," "assume," "believe,"
"continue," "could," "estimate," "expect," "forecast," "future,"
"goal," "intend," "likely," "may," "might," "plan," "potential,"
"predict," "project," "see," "seek," "should," "strategy,"
"strive," "target," "will," and "would" and similar expressions,
and variations or negatives of these words. Examples of
forward-looking statements include, among others, statements we
make regarding: guidance outlook and predictions relating to
expected operating results, such as revenue growth and earnings;
strategic actions such as acquisitions, joint ventures, and
dispositions, including our acquisition of CPA Global, the
anticipated benefits therefrom, and our success in integrating
acquired businesses; anticipated levels of capital expenditures in
future periods; our ability to successfully realize cost savings
initiatives and transition services expenses; our belief that we
have sufficiently liquidity to fund our ongoing business
operations; expectations of the effect on our financial condition
of claims, litigation, environmental costs, the COVID-19 pandemic
and governmental responses thereto, contingent liabilities, and
governmental and regulatory investigations and proceedings; and our
strategy for customer retention, growth, product development,
market position, financial results, and reserves. Forward-looking
statements are neither historical facts nor assurances of future
performance. Instead, they are based only on management's current
beliefs, expectations, and assumptions regarding the future of our
business, future plans and strategies, projections, anticipated
events and trends, the economy, and other future conditions.
Because forward-looking statements relate to the future, they are
difficult to predict and many of which are outside of our control.
Important factors that could cause our actual results and financial
condition to differ materially from those indicated in the
forward-looking statements are more fully discussed under the
caption "Risk Factors" in our 2019 Annual Report on Form 10-K, in
Part II, Item 1A of our quarterly reports on Form 10-Q for the
periods ended March 31, June 30 and September 30,
2020, and in our current report on Form 8-K filed on
June 19, 2020, along with our other
filings with the U.S. Securities and Exchange Commission ("SEC").
However, those factors should not be considered to be a complete
statement of all potential risks and uncertainties. Additional
risks and uncertainties not known to us or that we currently deem
immaterial may also impair our business operations. Forward-looking
statements are based only on information currently available to our
management and speak only as of the date of this communication. We
do not assume any obligation to publicly provide revisions or
updates to any forward-looking statements, whether as a result of
new information, future developments or otherwise, should
circumstances change, except as otherwise required by securities
and other applicable laws. Please consult our public filings with
the SEC or on our website at www.clarivate.com.
About Clarivate
Clarivate™ is a global leader in
providing solutions to accelerate the lifecycle of innovation. Our
bold mission is to help customers solve some of the world's most
complex problems by providing actionable information and insights
that reduce the time from new ideas to life-changing inventions in
the areas of science and intellectual property. We help customers
discover, protect and commercialize their inventions using our
trusted subscription and technology-based solutions coupled with
deep domain expertise. For more information, please visit
clarivate.com.
Category: Earnings guidance
Source: Clarivate Plc
1Non-GAAP
measure. Please see "Reconciliation to Certain Non-GAAP measures"
in this press release for important disclosures and reconciliations
of these financial measures to the most directly comparable GAAP
measure. These terms are defined elsewhere in this press
release.
|
2Excludes
the full year 2020 projected revenue of $58.0 million and projected
EBITDA of $11.0 million for Techstreet.
|
The following table presents our calculation of Adjusted
Revenues for the Outlook for 2020 and 2021 and a reconciliation of
this measure to our Revenues, net for the same period:
|
Year
Ending
December 31,
2020
(Forecasted)
|
|
Year
Ending
December 31,
2021
(Forecasted)
|
|
Low
|
|
High
|
|
Low
|
|
High
|
Revenues,
net
|
$
|
1,280.0
|
|
|
$
|
1,295.0
|
|
|
$
|
1,780.0
|
|
|
$
|
1,840.0
|
|
Adjusted revenues,
net(1)
|
$
|
1,280.0
|
|
|
$
|
1,295.0
|
|
|
$
|
1,780.0
|
|
|
$
|
1,840.0
|
|
Techstreet(2)
|
58.0
|
|
|
58.0
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Adjusted revenues,
net, excluding Techstreet
|
$
|
1,222.0
|
|
|
$
|
1,237.0
|
|
|
$
|
1,780.0
|
|
|
$
|
1,840.0
|
|
|
|
(1)
|
The Company is
evaluating the purchase accounting impact, including the deferred
revenue adjustment, related to the DRG acquisition.
|
|
|
(2)
|
Techstreet was
divested on November 6, 2020.
|
The following table presents our calculation of Adjusted EBITDA
for the Outlook for 2020 and 2021 and reconciles this measure to
our Net loss for the same period:
|
Year
Ending
December 31,
2020
(Forecasted)
|
|
Year
Ending
December 31,
2021
(Forecasted)
|
(in
millions)
|
Low
|
|
High
|
|
Low
|
|
High
|
Net income
(loss)
|
$
|
(165.1)
|
|
|
$
|
(150.1)
|
|
|
$
|
(7.5)
|
|
|
$
|
32.5
|
|
Provision for income
taxes
|
22.7
|
|
|
22.7
|
|
|
29.4
|
|
|
29.4
|
|
Depreciation and
amortization
|
312.5
|
|
|
312.5
|
|
|
545.8
|
|
|
545.8
|
|
Interest,
net
|
111.4
|
|
|
111.4
|
|
|
151.3
|
|
|
151.3
|
|
Transition,
transition services agreement, and integration
expense(1)
|
37.7
|
|
|
37.7
|
|
|
40.3
|
|
|
40.3
|
|
Transaction related
costs(2)
|
118.1
|
|
|
118.1
|
|
|
—
|
|
|
—
|
|
Share-based
compensation expense
|
37.6
|
|
|
37.6
|
|
|
26.0
|
|
|
26.0
|
|
Deferred revenue
adjustment
|
7.7
|
|
|
7.7
|
|
|
—
|
|
|
—
|
|
Other
|
(2.6)
|
|
|
(2.6)
|
|
|
(0.3)
|
|
|
(0.3)
|
|
Adjusted
EBITDA
|
$
|
480.0
|
|
|
$
|
495.0
|
|
|
$
|
785.0
|
|
|
$
|
825.0
|
|
Techstreet(3)
|
11.0
|
|
|
11.0
|
|
|
—
|
|
|
—
|
|
Adjusted EBITDA
excluding Techstreet
|
$
|
469.0
|
|
|
$
|
484.0
|
|
|
$
|
785.0
|
|
|
$
|
825.0
|
|
Adjusted EBITDA
margin
|
37
|
%
|
|
38
|
%
|
|
44
|
%
|
|
45
|
%
|
Adjusted EBITDA
margin excluding Techstreet
|
38
|
%
|
|
39
|
%
|
|
—
|
|
|
—
|
|
|
|
(1)
|
Includes
restructuring costs, other cost optimization activities, and
payments and receipts under transition service
agreements.
|
|
|
(2)
|
Includes cost
associated with merger and acquisition related
activities.
|
|
|
(3)
|
Techstreet was
divested on November 6, 2020.
|
The following table presents our calculation of Adjusted Diluted
EPS for the Outlook for 2020 and 2021 and reconciles these measures
to our Net loss for the same period:
|
Year
Ending December 31, 2020
(Forecasted)
|
|
Year
Ending December 31, 2021
(Forecasted)
|
|
Low
|
|
High
|
|
Low
|
|
High
|
|
Per
Share
|
|
Per
Share
|
|
Per
Share
|
|
Per
Share
|
Net income
(loss)
|
$
|
(0.19)
|
|
|
$
|
(0.13)
|
|
|
$
|
(0.01)
|
|
|
$
|
0.05
|
|
Transition,
transition services agreement, and integration
expense(1)
|
0.11
|
|
|
0.11
|
|
|
0.07
|
|
|
0.07
|
|
Transaction related
costs(2)
|
0.13
|
|
|
0.13
|
|
|
—
|
|
|
—
|
|
Share-based
compensation expense
|
0.07
|
|
|
0.07
|
|
|
0.04
|
|
|
0.04
|
|
Amortization related
to acquired intangible assets
|
0.48
|
|
|
0.48
|
|
|
0.68
|
|
|
0.68
|
|
Income tax impact of
related adjustments
|
(0.05)
|
|
|
(0.05)
|
|
|
(0.05)
|
|
|
(0.05)
|
|
Adjusted Diluted
EPS
|
$
|
0.55
|
|
|
$
|
0.61
|
|
|
$
|
0.73
|
|
|
$
|
0.79
|
|
Weighted average
ordinary shares (Diluted)
|
|
|
453,258,347
|
|
|
|
|
631,043,005
|
|
|
|
(1)
|
Includes
restructuring costs, other cost optimization activities, and
payments and receipts under transition service
agreements.
|
|
|
(2)
|
Includes cost
associated with merger and acquisition related
activities.
|
The following table presents our calculation of Free Cash Flow
and Adjusted Free Cash Flow for the Outlook for 2020 and 2021 and
reconciles this measure to our Net cash provided by operating
activities for the same period:
|
Year
Ending December 31, 2020
(Forecasted)
|
|
Year
Ending December 31, 2021
(Forecasted)
|
(in
millions)
|
Low
|
|
High
|
|
Low
|
|
High
|
Net cash provided
by operating activities
|
$
|
213.0
|
|
|
$
|
223.0
|
|
|
$
|
559.7
|
|
|
$
|
609.7
|
|
Capital
expenditures
|
(105.0)
|
|
|
(100.0)
|
|
|
(151.7)
|
|
|
(151.7)
|
|
Free Cash
Flow
|
108.0
|
|
|
123.0
|
|
|
408.0
|
|
|
458.0
|
|
Transition,
transition services agreement, and integration
expense(1)
|
52.0
|
|
|
55.0
|
|
|
42.0
|
|
|
42.0
|
|
Transaction related
costs(2)
|
80.0
|
|
|
82.0
|
|
|
—
|
|
|
—
|
|
Adjusted Free Cash
Flow
|
$
|
240.0
|
|
|
$
|
260.0
|
|
|
$
|
450.0
|
|
|
$
|
500.0
|
|
Techstreet
|
10.0
|
|
|
10.0
|
|
|
—
|
|
|
—
|
|
Adjusted Free Cash
Flow excluding Techstreet
|
$
|
230.0
|
|
|
$
|
250.0
|
|
|
$
|
450.0
|
|
|
$
|
500.0
|
|
|
|
(1)
|
Includes cash
payments related to restructuring and other cost optimization
activities.
|
|
|
(2)
|
Includes cash
payments related to merger and acquisition related
activities.
|
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