November 2024 - Page 325 of 327

Air Canada Reports Third Quarter 2024 Financial Results

01.11.2024 by admin

Third quarter operating revenues of $6.1 billion decreased 4% year over year.
Third quarter operating income of $1.040 billion and adjusted EBITDA* of $1.523 billion decreased $375 million and $307 million year over year, respectively.
Generated cash flows from operating activities of $737 million and free cash flow* of $282 million in the quarter, a year-over-year increase of $329 million and $147 million, respectively.
Leverage ratio* of 1.0 as at September 30, 2024, compared to 1.1 at end of 2023.
Normal course issuer bid announced.

MONTREAL, Nov. 1, 2024 /PRNewswire/ – Air Canada today reported its third quarter 2024 financial results.

“Air Canada reported solid results for the third quarter on key metrics, with operating revenues of $6.1 billion and operating income of $1 billion. Adjusted EBITDA of $1.5 billion and our adjusted earnings per share of $2.57 were both ahead of market expectations. We delivered on our ongoing operational improvement program, with quarterly on-time performance rising eight percentage points over the same period in 2023. I thank all our employees for their care and dedication in safely moving nearly 13 million customers in the quarter, including our Olympic and Paralympic athletes to the summer games in Paris,” said Michael Rousseau, President and Chief Executive of Air Canada.

“Summer is our peak season and this year our pilot contract negotiations added complexity. We proactively offered options and flexibility to customers, and I am proud that we concluded a mutually beneficial agreement without significant disruption to customers and with a contained revenue impact. I thank our customers for their loyalty and reiterate our promise to keep providing industry-leading products and services to them.

“The demand environment remains favourable. We have adjusted our full year guidance and underlying assumptions to account for the evolution of the fuel price environment and for certain contract-related adjustments. We are delivering on our commitments and are confident in our future. We are now announcing a new share buyback program, addressing some of the dilution experienced from financing decisions necessary during the pandemic, and returning value to shareholders. This additional step, after paying down our debt and funding our growth, is consistent with our capital allocation roadmap and our strategic plan, which we will detail at our Investor Day on December 17, 2024,” said Mr. Rousseau.

^*Adjusted CASM, adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization), adjusted EBITDA margin, leverage ratio, net debt, adjusted pre-tax income (loss), adjusted net income (loss), adjusted earnings (loss) per share, and free cash flow are referred to in this news release. Such measures are non-GAAP financial measures, non-GAAP ratios, or supplementary financial measures, are not recognized measures for financial statement presentation under GAAP, do not have standardized meanings, may not be comparable to similar measures presented by other entities and should not be considered a substitute for or superior to GAAP results. Refer to the “Non-GAAP Financial Measures” section of this news release for descriptions of these measures, and for a reconciliation of Air Canada non-GAAP measures used in this news release to the most comparable GAAP financial measure.

Third Quarter 2024 Financial Results

The following is an overview of Air Canada’s results of operations and financial position for the third quarter 2024 compared to the third quarter 2023.

Operating revenues of $6.106 billion decreased $238 million or 4%, resulting from lower passenger revenues.
Operated capacity increased 3%, lower than the capacity guidance of 4%-4.5% increase communicated in Air Canada’s news release dated August 7, 2024. This was primarily due to fleet constraints and to adjustments made to the operating schedule.
Operating expenses of $5.066 billion increased $137 million or 3%. The increase was largely due to higher costs in most line items due to capacity growth and was partially offset by certain contract-related adjustments recorded this quarter.
Operating income of $1.040 billion, with an operating margin of 17.0%, declined $375 million.
Adjusted EBITDA of $1.523 billion, with an adjusted EBITDA margin* of 24.9%, declined $307 million.
Net income of $2.035 billion, which included a favourable tax asset recognition of $1.154 billion, and diluted earnings per share of $5.38 compared to $1.250 billion and $3.08 per diluted share, respectively.
Adjusted net income* of $969 million and adjusted earnings per diluted share* of $2.57, compared to $1.281 billion and $3.41 per diluted share, respectively.
Adjusted CASM* of 12.15 cents decreased 0.4%, primarily due to the impact of contract-related adjustments recorded in the third quarter of 2024.
Net cash flows from operating activities of $737 million increased $329 million.
Free cash flow* of $282 million increased $147 million.
Net debt-to-adjusted EBITDA ratio* (leverage ratio) was 1.0 at September 30, 2024, compared to 1.1 at December 31, 2023.

Outlook

For the full year 2024, Air Canada is updating its guidance to account for updated expectations of jet fuel prices and the impact of contract-related cost adjustments. Full year 2024 guidance is as follows:

Metric	2024 Guidance	Prior 2024 Guidance
ASM capacity	Approximately 5% increase versus 2023	5.5% to 6.5% increase versus 2023
Adjusted CASM	Approximately 2% increase versus 2023	2.5% to 3.5% increase versus 2023
Adjusted EBITDA	Approximately $3.5 billion	$3.1 billion to $3.4 billion

Major Assumptions

Air Canada made assumptions in providing its guidance—including moderate Canadian GDP growth for 2024. Air Canada also assumes that the Canadian dollar will trade, on average, at C$1.36 per U.S. dollar for the full year 2024 and that the price of jet fuel will average C$1.00 per litre for the full year 2024.

Normal Course Issuer Bid

Air Canada is also announcing today that the Toronto Stock Exchange (“TSX”) has accepted notice of its intention to make a normal course issuer bid (“NCIB”) allowing it to purchase for cancellation up to 35,783,842 of its Class A variable voting shares and Class B voting shares (collectively the “Shares”) in accordance with the rules of the TSX.

Air Canada believes that purchases of Shares under the NCIB will allow it to address some of the shareholder dilution experienced from financing decisions necessary during the pandemic. Air Canada further believes that the market price of its Shares from time to time may not fully reflect the underlying value of its business and future business prospects. In such circumstances, the purchase of Shares under the NCIB may be an attractive and appropriate use of its available cash, consistent with Air Canada’s priority of investing in its growth, maintaining balance sheet strength and generating shareholder value through a balanced capital allocation strategy.

Air Canada is authorized by the TSX to purchase up to 35,783,842 Shares under the NCIB, being about 10% of the public float of its Shares. As at October 22, 2024, the number of outstanding Shares totalled 358,493,006, of which 357,838,424 Shares represented the public float. Purchases under the NCIB are authorized during the period from November 5, 2024 to November 4, 2025. Decisions regarding the amount and timing of purchases of Shares will be based on market conditions, share price and other factors. Air Canada may elect to modify, suspend or discontinue the NCIB at any time.

Purchases will be made through open market transactions on the TSX or Canadian alternative trading systems, if eligible, or such other means as securities regulatory authorities may allow, including block purchases, pre-arranged crosses or exempt offers, as well as private agreements under an issuer bid exemption order issued by a securities regulatory authority. Air Canada will pay the market price at the time of acquisition for any Share purchased, plus brokerage fees, or such other price as may be allowed. Any purchases made under an issuer bid exemption order would be at a discount to the prevailing market price of the Shares or otherwise in accordance with the terms of the order.

Within the past 12 months, Air Canada has not purchased any of its Shares. The average daily trading volume (“ADTV”) of the Shares on the TSX was 2,143,460 Shares for the six-month period ended September 30, 2024. Under TSX rules, Air Canada may accordingly purchase up to 535,865 Shares on the TSX on any trading day, being 25% of the ADTV. Air Canada may also, once weekly, purchase a block of Shares not directly or indirectly owned by insiders, which may exceed such daily limit, in accordance with TSX rules. All Shares purchased pursuant to the NCIB will be cancelled.

Air Canada will enter into an automatic share purchase plan (the “Plan”) with its designated broker to be effective on the commencement date of the NCIB. The Plan will allow for the purchase of Shares at times when Air Canada would ordinarily not be active in the market due to regulatory restrictions, self-imposed blackout periods or otherwise. Purchases by the designated broker made under the Plan, if any, will be based on parameters established by Air Canada in accordance with the rules of the TSX, applicable securities laws and the terms of the Plan. Shares may in Air Canada’s discretion be purchased under the NCIB outside of the self-imposed black-out or other restricted periods in compliance with the rules of the TSX and applicable securities laws.

Non-GAAP Financial Measures

Below is a description of certain non-GAAP financial measures and ratios used by Air Canada to provide readers with additional information on its financial and operating performance. Such measures are not recognized measures for financial statement presentation under GAAP, do not have standardized meanings, may not be comparable to similar measures presented by other entities and should not be considered a substitute for or superior to GAAP results. The non-GAAP financial measures or ratios described in this section typically have exclusions or adjustments that include one or more of the following characteristics, such as being highly variable, difficult to project, unusual in nature, significant to the results of a particular period or not indicative of past or future operating results. These items are excluded because the company believes these may distort the analysis of certain business trends and render comparative analysis across periods less meaningful and their exclusion generally allows for a more meaningful analysis of Air Canada’s operating expense performance and may allow for a more meaningful comparison to other airlines.

Air Canada excludes the effect of impairment of assets, if any, when calculating adjusted CASM, adjusted EBITDA, adjusted EBITDA margin, adjusted pre-tax income (loss) and adjusted net income (loss) as it may distort the analysis of certain business trends and render comparative analysis across periods or to other airlines less meaningful. Air Canada did not record charges for impairment of assets in the first nine months of 2024 or in 2023.

A charge of $34 million was recorded in the third quarter of 2024 in other operating expenses related to estimated costs associated with contractual lease obligations. Air Canada excluded this non-recurring expense in computing adjusted CASM, adjusted EBITDA, adjusted pre-tax income and adjusted net income.

Adjusted CASM

Air Canada uses adjusted CASM to assess the operating and cost performance of its ongoing airline business without the effects of aircraft fuel expense, the cost of ground packages at Air Canada Vacations and freighter costs as these items may distort the analysis of certain business trends and render comparative analysis across periods less meaningful and their exclusion generally allows for a more meaningful analysis of Air Canada’s operating expense performance and may allow for a more meaningful comparison to that of other airlines.

In calculating adjusted CASM, aircraft fuel expense is excluded from operating expense results as it fluctuates widely depending on many factors, including international market conditions, geopolitical events, jet fuel refining costs and Canada/U.S. currency exchange rates. Air Canada also incurs expenses related to ground packages at Air Canada Vacations which some airlines, without comparable tour operator businesses, may not incur. In addition, these costs do not generate ASMs and therefore excluding these costs from operating expense results provides for a more meaningful comparison across periods when such costs may vary.

Air Canada also incurs expenses related to the operation of freighter aircraft which some airlines, without comparable cargo businesses, may not incur. Air Canada had six Boeing 767 dedicated freighter aircraft in service as at September 30, 2024, and six as at September 30, 2023. These costs do not generate ASMs and therefore excluding these costs from operating expense results provides for a more meaningful comparison of the passenger airline business across periods.

Adjusted CASM is reconciled to GAAP operating expense as follows:

(Canadian dollars in millions, except where indicated)

Third Quarter

First Nine Months

2024

2023

Change

2024

2023

Change

Operating expense – GAAP

5,066

4,929

137

15,334

14,458

876

Adjusted for:

Aircraft fuel

(1,377)

(1,365)

(12)

(3,964)

(3,927)

(37)

Ground package costs

(102)

(99)

(3)

(574)

(543)

(31)

Freighter costs (excluding fuel)

(40)

(41)

(113)

(111)

(2)

Provision for contractual lease obligations

(34)

–

(34)

–

(34)

Operating expense, adjusted for the above-noted items

3,513

3,424

10,649

9,877

772

ASMs (millions)

28,892

28,060

3.0 %

79,432

74,573

6.5 %

Adjusted CASM (cents)

12.15

12.20

(0.05)

13.41

13.24

0.17

EBITDA and Adjusted EBITDA

Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) is commonly used in the airline industry and is used by Air Canada as a means to view operating results before interest, taxes, depreciation and amortization as these costs can vary significantly among airlines due to differences in the way airlines finance their aircraft and other assets.

Adjusted EBITDA margin (adjusted EBITDA as a percentage of operating revenues) is commonly used in the airline industry and is used by Air Canada as a means to measure the operating margin before interest, taxes, depreciation and amortization as these costs can vary significantly among airlines due to differences in the way airlines finance their aircraft and other assets.

Adjusted EBITDA and adjusted EBITDA margin are reconciled to GAAP operating income (loss) as follows:

Third Quarter

First Nine Months

(Canadian dollars in millions, except where indicated)

2024

2023

Change

2024

2023

Change

Operating income – GAAP

1,040

1,415

(375)

1,517

2,200

(683)

Add back:

Depreciation and amortization

449

415

1,339

1,261

EBITDA

1,489

1,830

(341)

2,856

3,461

(605)

Add back:

Provision for contractual lease obligations

–

Adjusted EBITDA

1,523

1,830

(307)

2,890

3,461

(571)

Operating revenues

6,106

6,344

(238)

16,851

16,658

193

Operating margin (%)

17.0

22.3

(5.3) pp

9.0

13.2

(4.2) pp

Adjusted EBITDA margin (%)

24.9

28.8

(3.9) pp

17.2

20.8

(3.6) pp

Adjusted Pre-tax Income (Loss)

Adjusted pre-tax income (loss) is used by Air Canada to assess the overall pre-tax financial performance of its business without the effects of foreign exchange gains or losses, net interest relating to employee benefits, gains or losses on financial instruments recorded at fair value, gains or losses on sale and leaseback of assets, gains or losses on disposal of assets, gains or losses on debt settlements and modifications, as these items may distort the analysis of certain business trends and render comparative analysis across periods or to other airlines less meaningful.

Adjusted pre-tax income (loss) is reconciled to GAAP income (loss) before income taxes as follows:

(Canadian dollars in millions)	Third Quarter						First Nine Months
(Canadian dollars in millions)	2024		2023		$ Change		2024		2023		$ Change
Income before income taxes – GAAP	$	897	$	1,317	$	(420)	$	1,236	$	2,090	$	(854)
Adjusted for:
Provision for contractual lease obligations		34		–		34		34		–		34
Foreign exchange (gain) loss		85		61		24		28		(317)		345
Net interest relating to employee benefits		(5)		(6)		1		(16)		(18)		2
Gain on financial instruments recorded at fair value		(26)		(101)		75		(66)		(24)		(42)
Loss on debt settlement		–		7		(7)		46		9		37
Adjusted pre-tax income	$	985	$	1,278	$	(293)	$	1,262	$	1,740	$	(478)

Adjusted Net Income (Loss) and Adjusted Earnings (Loss) Per Share – Diluted

Air Canada uses adjusted net income (loss) and adjusted earnings (loss) per share – diluted as a means to assess the overall financial performance of its business without the after-tax effects of foreign exchange gains or losses, net financing expense relating to employee benefits, gains or losses on financial instruments recorded at fair value, gains or losses on sale and leaseback of assets, gains or losses on debt settlements and modifications, gains or losses on disposal of assets as these items may distort the analysis of certain business trends and render comparative analysis to other airlines less meaningful.

Adjusted net income (loss) and adjusted earnings (loss) per share are reconciled to GAAP net income as follows:

(Canadian dollars in millions)	Third Quarter						First Nine Months
(Canadian dollars in millions)	2024		2023		$ Change		2024		2023		$ Change
Net income – GAAP	$	2,035	$	1,250	$	785	$	2,364	$	2,092	$	272
Adjusted for:
Provision for contractual lease obligations		34		–		34		34		–		34
Foreign exchange (gain) loss		85		61		24		28		(317)		345
Net interest relating to employee benefits		(5)		(6)		1		(16)		(18)		2
Gain on financial instruments recorded at fair value		(26)		(101)		75		(66)		(24)		(42)
Loss on debt settlement		–		7		(7)		46		9		37
Income tax, including for the above reconciling items ⁽¹⁾		(1,154)		70		(1,224)		(1,148)		15		(1,163)
Adjusted net income	$	969	$	1,281	$	(312)	$	1,242	$	1,757	$	(515)
Weighted average number of outstanding shares used in computing diluted income per share (in millions)		376		376		–		376		376		–
Adjusted earnings per share – diluted	$	2.57	$	3.41	$	(0.84)	$	3.30	$	4.67	$	(1.37)



(1)	In the third quarter of 2024, previously unrecognized deferred income tax asset was recognized which included a deferred income tax recovery of $1,154 million recorded in the consolidated statement of operations. This deferred income tax recovery of $1,154 million is removed from the adjusted net income. In 2023, the deferred income tax recovery recorded in other comprehensive income related to remeasurements on employee benefit liabilities was offset by a deferred income tax expense that was recorded through Air Canada’s consolidated statement of operations. This expense was removed from adjusted net income.

The table below reflects the share amounts used in the computation of basic and diluted earnings per share on an adjusted earnings per share basis:

(In millions)	Third Quarter		First Nine Months
(In millions)	2024	2023	2024	2023
Weighted average number of shares outstanding – basic	358	358	358	358
Effect of dilution	18	18	18	18
Weighted average number of shares outstanding – diluted	376	376	376	376

Free Cash Flow

Air Canada uses free cash flow as an indicator of the financial strength and performance of its business, indicating the amount of cash Air Canada can generate from operations and after capital expenditures. Free cash flow is calculated as net cash flows from operating activities minus additions to property, equipment, and intangible assets, and is net of proceeds from sale and leaseback transactions.

The table below reconciles free cash flow to net cash flows from (used in) operating activities for the periods indicated.

	Third Quarter						First Nine Months
(Canadian dollars in millions)	2024		2023		$ Change		2024		2023		$ Change
Net cash flows from operating activities	$	737	$	408	$	329	$	3,253	$	3,335	$	(82)
Additions to property, equipment, and intangible assets		(455)		(273)		(182)		(1,464)		(1,248)		(216)
Free cash flow	$	282	$	135	$	147	$	1,789	$	2,087	$	(298)

Net Debt

Net debt is a capital management measure and a key component of the capital managed by Air Canada and provides management with a measure of its net indebtedness.

Net Debt to Trailing 12-Month Adjusted EBITDA (Leverage Ratio)

Net debt to trailing 12-month adjusted EBITDA ratio (also referred to as “leverage ratio”) is commonly used in the airline industry and is used by Air Canada as a means to measure financial leverage. Leverage ratio is calculated by dividing net debt by trailing 12-month adjusted EBITDA.

The table below reconciles leverage ratio to Air Canada’s net debt balances as at the dates indicated.

(Canadian dollars in millions)	September 30, 2024		December 31, 2023		Change
Total long-term debt and lease liabilities	$	10,716	$	12,996	$	(2,280)
Current portion of long-term debt and lease liabilities		1,652		866		786
Total long-term debt and lease liabilities (including current portion)		12,368		13,862		(1,494)
Less cash, cash equivalents and short- and long-term investments		(8,942)		(9,295)		353
Net debt ⁽¹⁾	$	3,426	$	4,567	$	(1,141)
Adjusted EBITDA (trailing 12 months)	$	3,411		3,982		(571)
Net debt to adjusted EBITDA ratio		1.0		1.1		(0.1)

For further information on Air Canada’s public disclosure file, including Air Canada’s 2023 Annual Information Form, dated March 4, 2024, consult SEDAR at www.sedarplus.ca.

Third Quarter 2024 Conference Call

Air Canada will host its quarterly analysts’ call today, Friday, November 1, 2024, at 8:00 a.m. ET. Michael Rousseau, President and Chief Executive Officer, John Di Bert, Executive Vice President and Chief Financial Officer, and Mark Galardo, Executive Vice President, Revenue and Network Planning and President, Cargo, will present the results and be available for analysts’ questions. Immediately following the analysts’ Q&A session, Mr. Di Bert and Pierre Houle, Vice President and Treasurer, will be available to answer questions from term loan B lenders and holders of Air Canada bonds.

Media and the public may access this call on a listen-in basis. Details are as follows:

CAUTION REGARDING FORWARD-LOOKING INFORMATION

This news release includes forward-looking statements within the meaning of applicable securities laws. Forward-looking statements relate to analyses and other information that are based on forecasts of future results and estimates of amounts not yet determinable. These statements may involve, but are not limited to, comments relating to guidance, strategies, expectations, planned operations or future actions. Forward-looking statements are identified using terms and phrases such as “preliminary”, “anticipate”, “believe”, “could”, “estimate”, “expect”, “intend”, “may”, “plan”, “predict”, “project”, “will”, “would”, and similar terms and phrases, including references to assumptions.

Forward-looking statements, by their nature, are based on assumptions including those described herein and are subject to important risks and uncertainties. Forward-looking statements cannot be relied upon due to, among other things, changing external events and general uncertainties of the business of Air Canada. Actual results may differ materially from results indicated in forward-looking statements due to a number of factors, including those discussed below.

Factors that may cause results to differ materially from results indicated in forward-looking statements include economic conditions as well as geopolitical conditions such as the military conflicts in the Middle East and between Russia and Ukraine, Air Canada’s ability to successfully achieve or sustain positive net profitability, industry and market conditions and the demand environment, competition, Air Canada’s dependence on technology, cybersecurity risks, interruptions of service, climate change and environmental factors (including weather systems and other natural phenomena and factors arising from anthropogenic sources), Air Canada’s dependence on key suppliers (including government agencies and other stakeholders supporting airport and airline operations), employee and labour relations and costs, Air Canada’s ability to successfully implement appropriate strategic and other important initiatives (including Air Canada’s ability to manage operating costs), energy prices, Air Canada’s ability to pay its indebtedness and maintain or increase liquidity, Air Canada’s dependence on regional and other carriers, Air Canada’s ability to attract and retain required personnel, epidemic diseases, changes in laws, regulatory developments or proceedings, terrorist acts, war, Air Canada’s ability to successfully operate its loyalty program, casualty losses, Air Canada’s dependence on Star Alliance® and joint ventures, Air Canada’s ability to preserve and grow its brand, pending and future litigation and actions by third parties, currency exchange fluctuations, limitations due to restrictive covenants, insurance issues and costs, and pension plan obligations as well as the factors identified in Air Canada’s public disclosure file available at www.sedarplus.ca and, in particular, those identified in section 18 “Risk Factors” of Air Canada’s 2023 MD&A and in section 14 “Risk Factors” of Air Canada’s Third Quarter 2024 MD&A.

Air Canada has and continues to establish targets, make commitments and assess the impact regarding climate change, and related initiatives, plans and proposals that Air Canada and other stakeholders (including government, regulatory and other bodies) are pursuing in relation to climate change and carbon emissions. The achievement of our commitments and targets depends on many factors, including the combined actions of governments, industry, suppliers and other stakeholders and actors, as well as the development and implementation of new technologies. In particular, our 2030 carbon emission-related targets and our related 2050 aspiration are ambitious and heavily dependent on new technologies, renewable energies and the availability of a sufficient supply of sustainable aviation fuels (SAF), which continues to present serious challenges. In addition, Air Canada has incurred, and expects to continue to incur, costs to achieve its goal of net-zero carbon emissions and to comply with environmental sustainability legislation and regulation and other standards and accords. The precise nature of future binding or non-binding legislation, regulation, standards and accords, on which local and international stakeholders are increasingly focusing, cannot be predicted with any degree of certainty, nor can their financial, operational or other impact. There can be no assurance of the extent to which any of our climate goals will be achieved or that any future investments that we make in furtherance of achieving our climate goals will produce the expected results or meet increasing stakeholder environmental, social and governance expectations. Moreover, future events could lead Air Canada to prioritize other nearer-term interests over progressing toward our current climate goals based on business strategy, economic, regulatory and social factors, and potential pressure from investors, activist groups or other stakeholders. If we are unable to meet or properly report on our progress toward achieving our climate change goals and commitments, we could face adverse publicity and reactions from investors, customers, advocacy groups or other stakeholders, which could result in reputational harm or other adverse effects to Air Canada.

The forward-looking statements contained or incorporated by reference in this news release represent Air Canada’s expectations as of the date of this news release (or as of the date they are otherwise stated to be made) and are subject to change after such date. However, Air Canada disclaims any intention or obligation to update or revise any forward-looking statements whether because of new information, future events or otherwise, except as required under applicable securities regulations.

About Air Canada

Air Canada is Canada’s largest airline, the country’s flag carrier and a founding member of Star Alliance, the world’s most comprehensive air transportation network. Air Canada provides scheduled service directly to more than 180 airports in Canada, the United States and Internationally on six continents. It holds a Four-Star ranking from Skytrax. Air Canada’s Aeroplan program is Canada’s premier travel loyalty program, where members can earn or redeem points on the world’s largest airline partner network of 45 airlines, plus through an extensive range of merchandise, hotel and car rental partners. Through Air Canada Vacations, it offers more travel choices than any other Canadian tour operator to hundreds of destinations worldwide, with a wide selection of hotels, flights, cruises, day tours, and car rentals. Its freight division, Air Canada Cargo, provides air freight lift and connectivity to hundreds of destinations across six continents using Air Canada’s passenger and freighter aircraft. Air Canada aims to achieve a long-term aspirational goal of net-zero GHG emissions by 2050. Air Canada shares are publicly traded on the TSX in Canada and the OTCQX in the US.

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Selected Financial Metrics and Statistics

The financial and operating highlights for Air Canada for the periods indicated are as follows:

(Canadian dollars in millions, except per share data or where indicated)	Third Quarter			First Nine Months
Financial Performance Metrics	2024	2023	Change $	2024	2023	Change $
Operating revenues	6,106	6,344	(238)	16,851	16,658	193
Operating income	1,040	1,415	(375)	1,517	2,200	(683)
Operating margin ⁽¹⁾ (%)	17.0	22.3	(5.3) pp ⁽⁸⁾	9.0	13.2	(4.2) pp
Adjusted EBITDA ⁽²⁾	1,523	1,830	(307)	2,890	3,461	(571)
Adjusted EBITDA margin⁽²⁾ (%)	24.9	28.8	(3.9) pp	17.2	20.8	(3.6) pp
Income before income taxes	897	1,317	(420)	1,236	2,090	(854)
Net income	2,035	1,250	785	2,364	2,092	272
Adjusted pre-tax income ⁽²⁾	985	1,278	(293)	1,262	1,740	(478)
Adjusted net income ⁽²⁾	969	1,281	(312)	1,242	1,757	(515)
Total liquidity ⁽³⁾	10,261	9,949	312	10,261	9,949	312
Net cash flows from operating activities	737	408	329	3,253	3,335	(82)
Free cash flow ⁽²⁾	282	135	147	1,789	2,087	(298)
Net debt ⁽²⁾	3,426	5,438	(2,012)	3,426	5,438	(2,012)
Diluted earnings per share	5.38	3.08	2.30	6.25	5.55	0.70
Adjusted earnings per share – diluted ⁽²⁾	2.57	3.41	(0.84)	3.30	4.67	(1.37)
Operating Statistics ⁽⁴⁾	2024	2023	Change %	2024	2023	Change %
Revenue passenger miles (RPMs) (millions)	25,101	25,202	(0.4)	68,070	65,397	4.1
Available seat miles (ASMs) (millions)	28,892	28,060	3.0	79,432	74,573	6.5
Passenger load factor %	86.9 %	89.8 %	(2.9) pp	85.7 %	87.7 %	(2.0) pp
Passenger revenue per RPM (Yield) (cents)	22.3	23.3	(4.0)	22.1	22.7	(3.0)
Passenger revenue per ASM (PRASM) (cents)	19.4	20.9	(7.2)	18.9	19.9	(5.0)
Operating revenue per ASM (TRASM) (cents)	21.1	22.6	(6.5)	21.2	22.3	(5.0)
Operating expense per ASM (CASM) (cents)	17.5	17.6	(0.2)	19.3	19.4	(0.4)
Adjusted CASM (cents) ⁽²⁾	12.2	12.2	(0.4)	13.4	13.2	1.2
Average number of full-time-equivalent (FTE) employees (thousands) ⁽⁵⁾	37.2	35.9	3.7	37.1	35.4	4.7
Aircraft in operating fleet at period-end	353	354	(0.3)	353	354	(0.3)
Seats dispatched (thousands)	15,258	14,707	3.7	42,950	40,390	6.3
Aircraft frequencies (thousands)	104.5	101.0	3.5	293.4	279.7	4.9
Average stage length (miles) ⁽⁶⁾	1,894	1,908	(0.7)	1,849	1,846	0.2
Fuel cost per litre (cents)	98.2	101.9	(3.7)	102.5	109.6	(6.5)
Fuel litres (thousands)	1,399,170	1,342,967	4.2	3,857,355	3,572,766	8.0
Revenue passengers carried (thousands) ⁽⁷⁾	12,618	12,635	(0.1)	34,957	33,891	3.1


(1)	Operating margin is a supplementary financial measure and is defined as operating income (loss) as a percentage of operating revenues.
(2)	Adjusted pre-tax income (loss), adjusted net income (loss), adjusted earnings (loss) per share, adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization), adjusted EBITDA margin, free cash flow, net debt and adjusted CASM are non-GAAP financial measures, capital management measures, non-GAAP ratios or supplementary financial measures. Such measures are not recognized measures for financial statement presentation under GAAP, do not have standardized meanings, may not be comparable to similar measures presented by other entities and should not be considered a substitute for or superior to GAAP results. Refer to section “Non-GAAP Financial Measures” of this release for descriptions of Air Canada’s non-GAAP financial measures and for a quantitative reconciliation of Air Canada’s non-GAAP financial measures to the most comparable GAAP measure.
(3)	Total liquidity refers to the sum of cash, cash equivalents, short- and long-term investments, and the amounts available under Air Canada’s credit facilities. Total liquidity, as at September 30, 2024, of $10,261 million consisted of $8,942 million in cash, cash equivalents, short- and long-term investments and $1,319 million available under undrawn credit facilities. As at September 30, 2023, total liquidity of $9,949 million consisted of $8,934 million in cash, cash equivalents, short- and long-term investments and $1,015 million available under undrawn credit facilities. Total liquidity also includes funds ($243 million as at September 30, 2024, and $240 million as at September 30, 2023) held in trust by Air Canada Vacations in accordance with regulatory requirements governing advance sales for tour operators.
(4)	Except for the reference to average number of FTE employees, operating statistics in this table include third-party carriers operating under capacity purchase agreements with Air Canada.
(5)	Reflects FTE employees at Air Canada and its subsidiaries. Excludes FTE employees at third-party carriers operating under capacity purchase agreements with Air Canada.
(6)	Average stage length is calculated by dividing the total number of available seat miles by the total number of seats dispatched.
(7)	Revenue passengers are counted on a flight number basis (rather than by journey/itinerary or by leg), which is consistent with the IATA definition of revenue passengers carried.
(8)	“pp” denotes percentage points and refers to a measure of the arithmetic difference between two percentages.

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SOURCE Air Canada

Markets News

Apple, Amazon And 3 Stocks To Watch Heading Into Friday

01.11.2024 by admin

With U.S. stock futures trading mixed this morning on Friday, some of the stocks that may grab investor focus today are as follows:

Wall Street expects Chevron Corporation CVX to report quarterly earnings at $2.43 per share on revenue of $48.99 billion before the opening bell, according to data from Benzinga Pro. Chevron shares fell 0.5% to $148.04 in after-hours trading.
Apple Inc. AAPL reported better-than-expected earnings and sales results for the fourth quarter. The company reported fiscal fourth-quarter revenue of $94.9 billion, beating analyst estimates of $94.56 billion. The iPhone maker reported fourth-quarter adjusted earnings of $1.64 per share, beating analyst estimates of $1.60 per share. Apple shares fell 1.8% to $221.74 in the after-hours trading session.
Analysts are expecting Exxon Mobil Corporation XOM to post quarterly earnings at $1.88 per share on revenue of $93.94 billion. The company will release earnings before the markets open. Exxon Mobil shares fell 0.04% to $116.73 in after-hours trading.

Check out our premarket coverage here

Amazon.com Inc. AMZN posted stronger-than-expected results for the third quarter on Thursday. Amazon reported third-quarter net sales of $158.9 billion, up 11% year-over-year. The total beat a Street consensus estimate of $157.2 billion, according to data from Benzinga Pro. The company said it sees fourth-quarter net sales to come in a range of $181.5 billion to $188.5 billion, up 7% to 11% year-over-year. Amazon shares jumped 6% to $197.50 in the after-hours trading session.
Analysts expect Cardinal Health, Inc. CAH to report quarterly earnings at $1.62 per share on revenue of $50.9 billion before the opening bell. Cardinal Health shares gained 0.1% to $108.65 in after-hours trading.

Check This Out:

Photo courtesy: Shutterstock

Market News and Data brought to you by Benzinga APIs

Earnings News

Waters Corporation (NYSE: WAT) Reports Third Quarter 2024 Financial Results

01.11.2024 by admin

Highlights

Sales of $740 million exceeded guidance, grew 4% as reported and 4% in constant currency
Instruments returned to growth; recurring revenue grew high single-digits in constant currency
All reported regions returned to growth in the quarter; sales grew across all end markets, led by Pharma & Industrial
GAAP EPS of $2.71 and non-GAAP EPS of $2.93 significantly exceeded guidance, led by strong operational performance and better-than-expected market conditions
Raised full-year sales and EPS guidance, with 5% to 7% constant currency growth expected in the fourth quarter

Third Quarter 2024

MILFORD, Mass., Nov. 1, 2024 /PRNewswire/ — Waters Corporation WAT today announced its financial results for the third quarter of 2024.

Sales for the third quarter of 2024 were $740 million, an increase of 4% as reported, compared to sales of $712 million for the third quarter of 2023. Currency translation had minimal impact on sales.

On a GAAP basis, diluted earnings per share (EPS) for the third quarter of 2024 was $2.71, compared to $2.27 for the third quarter of 2023. On a non-GAAP basis, EPS was $2.93, compared to $2.84 for the third quarter of 2023. This includes a headwind of approximately 2% due to unfavorable foreign exchange.

“We delivered exceptional third quarter results, fueled by new product adoption and improved customer spending trends,” said Dr. Udit Batra, President & CEO, Waters Corporation. “Instruments returned to growth sooner than expected, as liquid chromatography sales to pharma and industrial customers turned positive.”

Dr. Batra continued, “Looking ahead, our strong commercial execution, competitive product portfolio, and excellent operational performance give us confidence in the long-term outlook for Waters.”

Other Highlights

During the third quarter of 2024, sales into the pharmaceutical market increased 2% as reported and 3% in constant currency. Sales into the industrial market increased 9% as reported and 7% in constant currency. Sales into the academic and government market increased 2% as reported and were flat in constant currency.

During the quarter, instrument system sales increased 1% as reported and in constant currency. Recurring revenues, which represent the combination of service and precision chemistries, increased 6% as reported and 7% in constant currency.

Geographically, sales in Asia during the quarter increased 5% as reported and 6% in constant currency. Sales in the Americas increased 1% as reported and in constant currency. Sales in Europe increased 6% as reported and 4% in constant currency.

Unless otherwise noted, sales growth and decline percentages are presented on an as-reported basis. A description and reconciliation of GAAP to non-GAAP results appear in the tables below and can be found on the Company’s website www.waters.com in the Investor Relations section.

Full-Year and Fourth Quarter 2024 Financial Guidance

Full-Year 2024 Financial Guidance

The Company is raising its full-year 2024 sales guidance, and now expects organic constant currency sales growth to be in the range of -0.9% to -0.3%. Currency translation is expected to decrease full-year sales growth by 1.2%. M&A contribution from the Wyatt transaction covering the first four-and-a-half months of the year has added 1.3% to full-year reported sales. The resulting full-year 2024 reported sales growth is expected in the range of -0.8% to -0.2%.

The Company is also raising its full-year 2024 non-GAAP EPS guidance to now be in the range of $11.67 to $11.87, which includes an estimated headwind of approximately 3% due to unfavorable foreign exchange.

Please refer to the tables below for a reconciliation of the projected GAAP to non-GAAP financial outlook for the full year.

Fourth Quarter 2024 Financial Guidance

The Company expects fourth quarter 2024 constant currency sales growth to be in the range of +5.0% to +7.0%. Currency translation is expected to decrease fourth quarter sales growth by 1.7%. The resulting fourth quarter 2024 reported sales growth is expected in the range of +3.3% to +5.3%.

The Company expects fourth quarter 2024 non-GAAP EPS to be in the range of $3.90 to $4.10, which includes an estimated headwind of approximately 3% due to unfavorable foreign exchange.

Please refer to the tables below for a reconciliation of the projected GAAP to non-GAAP financial outlook for the fourth quarter.

Conference Call Details

Waters Corporation will webcast its third quarter 2024 financial results conference call today, November 1, 2024, at 8:00 a.m. Eastern Time. To listen to the call and see the accompanying slide presentation, please visit www.waters.com, select “Investor Relations” under the “About Waters” section, navigate to “Events & Presentations,” and click on the “Webcast.” A replay will be available through November 29, 2024, on the same website by webcast and also by phone at (888) 282-0031.

About Waters Corporation

Waters Corporation WAT, a global leader in analytical instruments and software, has pioneered chromatography, mass spectrometry, and thermal analysis innovations serving the life, materials, food, and environmental sciences for more than 65 years. With approximately 7,500 employees worldwide, Waters operates directly in 35 countries, including 15 manufacturing facilities, and with products available in more than 100 countries. For more information, visit www.waters.com.

Non-GAAP Financial Measures

This press release contains financial measures, such as organic constant currency growth rates, adjusted operating income, adjusted net income, adjusted earnings per diluted share and free cash flow, among others, which are considered “non-GAAP” financial measures under applicable U.S. Securities and Exchange Commission rules and regulations. These non-GAAP financial measures should be considered supplemental to, and not a substitute for, financial information prepared in accordance with U.S. generally accepted accounting principles (GAAP). The Company’s definitions of these non-GAAP measures may differ from similarly titled measures used by others. The non-GAAP financial measures used in this press release adjust for specified items that can be highly variable or difficult to predict. The Company generally uses these non-GAAP financial measures to facilitate management’s financial and operational decision-making, including evaluation of the Company’s historical operating results, comparison to competitors’ operating results and determination of management incentive compensation. These non-GAAP financial measures reflect an additional way of viewing aspects of the Company’s operations that, when viewed with GAAP results and the reconciliations to corresponding GAAP financial measures, may provide a more complete understanding of factors and trends affecting the Company’s business. Because non-GAAP financial measures exclude the effect of items that will increase or decrease the Company’s reported results of operations, management strongly encourages investors to review the Company’s consolidated financial statements and publicly filed reports in their entirety. Reconciliations of the non-GAAP financial measures to the most directly comparable GAAP financial measures are included in the tables accompanying this release.

Cautionary Statement

This release contains “forward-looking” statements regarding future results and events. For this purpose, any statements that are not statements of historical fact may be deemed forward-looking statements. Without limiting the foregoing, the words “feels”, “believes”, “anticipates”, “plans”, “expects”, “intends”, “suggests”, “appears”, “estimates”, “projects” and similar expressions, whether in the negative or affirmative, are intended to identify forward-looking statements. The Company’s actual future results may differ significantly from the results discussed in the forward- looking statements within this release for a variety of reasons, including and without limitation, risks related to, and expectations or ability to realize commercial success of the Wyatt transaction; the impact of this transaction on the Company’s business, anticipated progress on Waters’ research programs, development of new analytical instruments and associated software or consumables, manufacturing development and capabilities; the increased indebtedness of the Company as a result of the Wyatt transaction, the repayment of which could impact the Company’s future results, market prospects for its products and sales and earnings guidance; foreign currency exchange rate fluctuations potentially affecting translation of the Company’s future non-U.S. operating results, particularly when a foreign currency weakens against the U.S. dollar; current global economic, sovereign and political conditions and uncertainties, including the effect of new or proposed tariff or trade regulations as well as other new or changed domestic and foreign laws, regulations and policies; changes in inflation and interest rates; the impacts and costs of war, in particular as a result of the ongoing conflicts between Russia and Ukraine and in the Middle East, and the possibility of further escalation resulting in new geopolitical and regulatory instability; the Chinese government’s ongoing tightening of restrictions on procurement by government-funded customers; the Company’s ability to access capital, maintain liquidity and service the Company’s debt in volatile market conditions; risks related to the effects of any pandemic on our business, financial condition, results of operations and prospects; changes in timing and demand for the Company’s products among the Company’s customers and various market sectors, particularly as a result of fluctuations in their expenditures or ability to obtain funding; the ability to realize the expected benefits related to the Company’s various cost-saving initiatives, including workforce reductions and organizational restructurings; the introduction of competing products by other companies and loss of market share, as well as pressures on prices from competitors and/or customers; changes in the competitive landscape as a result of changes in ownership, mergers and continued consolidation among the Company’s competitors; regulatory, economic and competitive obstacles to new product introductions; lack of acceptance of new products and inability to grow organically through innovation; rapidly changing technology and product obsolescence; risks associated with previous or future acquisitions, strategic investments, joint ventures and divestitures, including risks associated with achieving the anticipated financial results and operational synergies; contingent purchase price payments and expansion of our business into new or developing markets; risks associated with unexpected disruptions in operations; failure to adequately protect the Company’s intellectual property, infringement of intellectual property rights of third parties and inability to obtain licenses on commercially reasonable terms; the Company’s ability to acquire adequate sources of supply and its reliance on outside contractors for certain components and modules, as well as disruptions to its supply chain; risks associated with third-party sales intermediaries and resellers; the impact and costs of changes in statutory or contractual tax rates in jurisdictions in which the Company operates as well as shifts in taxable income among jurisdictions with different effective tax rates, the outcome of ongoing and future tax examinations and changes in legislation affecting the Company’s effective tax rate; the Company’s ability to attract and retain qualified employees and management personnel; risks associated with cybersecurity and technology, including attempts by third parties to defeat the security measures of the Company and its third-party partners; increased regulatory burdens as the Company’s business evolves, especially with respect to the U.S. Food and Drug Administration and U.S. Environmental Protection Agency, among others, and in connection with government contracts; regulatory, environmental and logistical obstacles affecting the distribution of the Company’s products, completion of purchase order documentation and the ability of customers to obtain letters of credit or other financing alternatives; risks associated with litigation and other legal and regulatory proceedings; and the impact and costs incurred from changes in accounting principles and practices. Such factors and others are discussed more fully in the sections entitled “Forward-Looking Statements” and “Risk Factors” of the Company’s annual report on Form 10-K for the year ended December 31, 2023, as well as in the sections entitled “Special Note Regarding Forward-Looking Statements” and “Risk Factors” of the Company’s quarterly reports on Form 10-Q for the quarterly periods ended March 30, 2024 and June 29, 2024, as filed with the Securities and Exchange Commission (“SEC”), which discussions are incorporated by reference in this release, as updated by the Company’s future filings with the SEC. The forward-looking statements included in this release represent the Company’s estimates or views as of the date of this release and should not be relied upon as representing the Company’s estimates or views as of any date subsequent to the date of this release. Except as required by law, the Company does not assume any obligation to update any forward-looking statements.

Waters Corporation and Subsidiaries
Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)


	Three Months Ended		Nine Months Ended
	September 28, 2024	September 30, 2023	September 28, 2024	September 30, 2023

Net sales	$ 740,305	$ 711,692	$ 2,085,673	$ 2,136,942

Costs and operating expenses:
Cost of sales	301,655	291,407	851,685	876,863
Selling and administrative expenses	169,097	186,748	516,880	555,657
Research and development expenses	45,336	41,995	136,113	130,559
Purchased intangibles amortization	11,759	12,116	35,337	20,410
Litigation provision	1,326	–	11,568	–

Operating income	211,132	179,426	534,090	553,453

Other (expense) income, net	(338)	328	1,619	1,364
Interest expense, net	(17,177)	(26,559)	(57,824)	(56,174)

Income from operations before income taxes	193,617	153,195	477,885	498,643

Provision for income taxes	32,114	18,643	71,449	72,614

Net income	$ 161,503	$ 134,552	$ 406,436	$ 426,029


Net income per basic common share	$ 2.72	$ 2.28	$ 6.85	$ 7.21

Weighted-average number of basic common shares	59,367	59,093	59,314	59,061


Net income per diluted common share	$ 2.71	$ 2.27	$ 6.83	$ 7.19

Weighted-average number of diluted common shares and equivalents	59,504	59,255	59,471	59,262

Waters Corporation and Subsidiaries
Reconciliation of GAAP to Adjusted Non-GAAP
Net Sales by Operating Segments, Products & Services, Geography and Markets
Three Months Ended September 28, 2024 and September 30, 2023
(In thousands)


							Constant
	Three Months Ended				Percent	Impact of	Currency
	September 28, 2024		September 30, 2023		Change	Currency	Growth Rate ^(a)

NET SALES – OPERATING SEGMENTS

Waters	$	655,652	$	629,348	4 %	0 %	4 %
TA		84,653		82,344	3 %	1 %	2 %

Total	$	740,305	$	711,692	4 %	0 %	4 %


NET SALES – PRODUCTS & SERVICES

Instruments	$	323,076	$	319,431	1 %	0 %	1 %

Service		278,294		263,611	6 %	0 %	6 %
Chemistry		138,935		128,650	8 %	0 %	8 %
Total Recurring		417,229		392,261	6 %	(1 %)	7 %

Total	$	740,305	$	711,692	4 %	0 %	4 %


NET SALES – GEOGRAPHY

Asia	$	251,329	$	238,228	5 %	(1 %)	6 %
Americas		279,136		275,479	1 %	0 %	1 %
Europe		209,840		197,985	6 %	2 %	4 %

Total	$	740,305	$	711,692	4 %	0 %	4 %


NET SALES – MARKETS

Pharmaceutical	$	430,138	$	421,535	2 %	(1 %)	3 %
Industrial		227,740		209,449	9 %	2 %	7 %
Academic & Government		82,427		80,708	2 %	2 %	0 %

Total	$	740,305	$	711,692	4 %	0 %	4 %

(a)

The Company believes that referring to comparable constant currency growth rates is a useful way to evaluate the underlying performance of Waters Corporation’s net sales. Constant currency growth, a non-GAAP financial measure, measures the change in net sales between current and prior year periods, excluding the impact of foreign currency exchange rates during the current period. See description of non-GAAP financial measures contained in this release.

Waters Corporation and Subsidiaries
Reconciliation of GAAP to Adjusted Non-GAAP
Net Sales by Operating Segments, Products & Services, Geography and Markets
Nine Months Ended September 28, 2024 and September 30, 2023
(In thousands)

								Organic
								Constant
	Nine Months Ended				Percent	Impact of	Impact of	Currency
	September 28, 2024		September 30, 2023		Change	Currency	Acquisitions	Growth Rate ^(a)

NET SALES – OPERATING SEGMENTS

Waters	$	1,840,112	$	1,884,658	(2 %)	(1 %)	2 %	(3 %)
TA		245,561		252,284	(3 %)	(1 %)	0 %	(2 %)

Total	$	2,085,673	$	2,136,942	(2 %)	(1 %)	2 %	(3 %)


NET SALES – PRODUCTS & SERVICES

Instruments	$	859,079	$	964,380	(11 %)	0 %	3 %	(14 %)

Service		812,367		774,478	5 %	(1 %)	1 %	5 %
Chemistry		414,227		398,084	4 %	(1 %)	0 %	5 %
Total Recurring		1,226,594		1,172,562	5 %	(1 %)	1 %	5 %

Total	$	2,085,673	$	2,136,942	(2 %)	(1 %)	2 %	(3 %)


NET SALES – GEOGRAPHY

Asia	$	696,319	$	745,932	(7 %)	(3 %)	1 %	(5 %)
Americas		794,775		804,827	(1 %)	0 %	3 %	(4 %)
Europe		594,579		586,183	1 %	2 %	2 %	(3 %)

Total	$	2,085,673	$	2,136,942	(2 %)	(1 %)	2 %	(3 %)


NET SALES – MARKETS

Pharmaceutical	$	1,220,092	$	1,233,177	(1 %)	(1 %)	2 %	(2 %)
Industrial		644,459		648,754	(1 %)	0 %	1 %	(2 %)
Academic & Government		221,122		255,011	(13 %)	1 %	2 %	(16 %)

Total	$	2,085,673	$	2,136,942	(2 %)	(1 %)	2 %	(3 %)

(a)

The Company believes that referring to comparable organic constant currency growth rates is a useful way to evaluate the underlying performance of Waters Corporation’s net sales. Organic constant currency growth, a non-GAAP financial measure, measures the change in net sales between current and prior year periods, excluding the impact of foreign currency exchange rates during the current period and excluding the impact of acquisitions made within twelve months of the acquisition close date. See description of non-GAAP financial measures contained in this release.

Waters Corporation and Subsidiaries
Reconciliation of GAAP to Adjusted Non-GAAP Financials
Three and Nine Months Ended September 28, 2024 and September 30, 2023
(In thousands, except per share data)

												Income from
												Operations
			Selling &		Research &			Operating		Other		before		Provision for				Diluted
			Administrative		Development		Operating	Income		(Expense)		Income		Income		Net		Earnings
			Expenses^(a)		Expenses		Income	Percentage		Income		Taxes		Taxes		Income		per Share
Three Months Ended September 28, 2024
GAAP		$	182,182	$	45,336	$	211,132	28.5 %	$	(338)	$	193,617	$	32,114	$	161,503	$	2.71
Adjustments:
	Purchased intangibles amortization ^(b)		(11,759)		–		11,759	1.6 %		–		11,759		2,814		8,945		0.15
	Litigation provision ^(c)		(1,326)		–		1,326	0.2 %		–		1,326		318		1,008		0.02
	Restructuring costs and certain other items ^(d)		(1,194)		–		1,194	0.2 %		–		1,194		282		912		0.02
	Retention bonus obligation ^(f)		(1,909)		(636)		2,545	0.3 %		–		2,545		611		1,934		0.03
Adjusted Non-GAAP		$	165,994	$	44,700	$	227,956	30.8 %	$	(338)	$	210,441	$	36,139	$	174,302	$	2.93

Three Months Ended September 30, 2023
GAAP		$	198,864	$	41,995	$	179,426	25.2 %	$	328	$	153,195	$	18,643	$	134,552	$	2.27
Adjustments:
	Purchased intangibles amortization ^(b)		(12,116)		–		12,116	1.7 %		–		12,116		2,901		9,215		0.16
	Restructuring costs and certain other items ^(d)		(24,057)		–		24,057	3.4 %		(651)		23,406		5,387		18,019		0.30
	Acquisition related costs ^(e)		(1,263)		–		1,263	0.2 %		–		1,263		303		960		0.02
	Retention bonus obligation ^(f)		(5,725)		(1,909)		7,634	1.1 %		–		7,634		1,832		5,802		0.10
Adjusted Non-GAAP		$	155,703	$	40,086	$	224,496	31.5 %	$	(323)	$	197,614	$	29,066	$	168,548	$	2.84

Nine Months Ended September 28, 2024
GAAP		$	563,785	$	136,113	$	534,090	25.6 %	$	1,619	$	477,885	$	71,449	$	406,436	$	6.83
Adjustments:
	Purchased intangibles amortization ^(b)		(35,337)		–		35,337	1.7 %		–		35,337		8,456		26,881		0.45
	Litigation provision and settlement ^(c)		(11,568)		–		11,568	0.6 %		–		11,568		2,776		8,792		0.15
	Restructuring costs and certain other items ^(d)		(10,680)		–		10,680	0.5 %		–		10,680		2,617		8,063		0.14
	Retention bonus obligation ^(f)		(11,451)		(3,817)		15,268	0.7 %		–		15,268		3,664		11,604		0.20
Adjusted Non-GAAP		$	494,749	$	132,296	$	606,943	29.1 %	$	1,619	$	550,738	$	88,962	$	461,776	$	7.76

Nine Months Ended September 30, 2023
GAAP		$	576,067	$	130,559	$	553,453	25.9 %	$	1,364	$	498,643	$	72,614	$	426,029	$	7.19
Adjustments:
	Purchased intangibles amortization ^(b)		(20,410)		–		20,410	1.0 %		–		20,410		4,852		15,558		0.26
	Restructuring costs and certain other items ^(d)		(28,881)		–		28,881	1.4 %		(651)		28,230		6,860		21,370		0.36
	Acquisition related costs ^(e)		(13,298)		–		13,298	0.6 %		–		13,298		3,191		10,107		0.17
	Retention bonus obligation ^(f)		(8,368)		(2,790)		11,158	0.5 %		–		11,158		2,678		8,480		0.14
Adjusted Non-GAAP		$	505,110	$	127,769	$	627,200	29.4 %	$	713	$	571,739	$	90,195	$	481,544	$	8.13

________________________________

(a)

Selling & administrative expenses include purchased intangibles amortization and litigation provisions and settlements.

(b)

The purchased intangibles amortization, a non-cash expense, was excluded to be consistent with how management evaluates the performance of its core business against historical operating results and the operating results of competitors over periods of time.

(c)

Litigation provisions and settlement gains were excluded as these items are isolated, unpredictable and not expected to recur regularly.

(d)

Restructuring costs and certain other items were excluded as the Company believes that the cost to consolidate operations, reduce overhead, and certain other income or expense items are not normal and do not represent future ongoing business expenses of a specific function or geographic location of the Company.

(e)

Acquisition related costs include all incremental expenses incurred, such as advisory, legal, accounting, tax, valuation, and other professional fees. The Company believes that these costs are not normal and do not represent future ongoing business expenses.

(f)

In connection with the Wyatt acquisition, the Company started to recognize a two-year retention bonus obligation that is contingent upon the employee’s providing future service and continued employment with Waters. The Company believes that these costs are not normal and do not represent future ongoing business expenses.

Waters Corporation and Subsidiaries
Preliminary Condensed Unclassified Consolidated Balance Sheets
(In thousands and unaudited)



	September 28, 2024	December 31, 2023

Cash, cash equivalents and investments	$ 331,458	$ 395,974
Accounts receivable	669,534	702,168
Inventories	518,994	516,236
Property, plant and equipment, net	642,627	639,073
Intangible assets, net	591,883	629,187
Goodwill	1,306,593	1,305,446
Other assets	450,531	438,770
Total assets	$ 4,511,620	$ 4,626,854


Notes payable and debt	$ 1,826,248	$ 2,355,513
Other liabilities	1,082,273	1,121,000
Total liabilities	2,908,521	3,476,513

Total stockholders’ equity	1,603,099	1,150,341
Total liabilities and stockholders’ equity	$ 4,511,620	$ 4,626,854

Waters Corporation and Subsidiaries
Preliminary Condensed Consolidated Statements of Cash Flows
Three and Nine Months Ended September 28, 2024 and September 30, 2023
(In thousands and unaudited)

				Three Months Ended		Nine Months Ended
				September 28, 2024	September 30, 2023	September 28, 2024	September 30, 2023

Cash flows from operating activities:
	Net income			$ 161,503	$ 134,552	$ 406,436	$ 426,029
	Adjustments to reconcile net income to net
			cash provided by operating activities:
		Stock-based compensation		10,647	8,490	32,993	32,224
		Depreciation and amortization		47,507	47,807	143,250	117,845
		Change in operating assets and liabilities and other, net		(15,077)	(33,031)	(60,695)	(203,411)
			Net cash provided by operating activities	204,580	157,818	521,984	372,687

Cash flows from investing activities:
	Additions to property, plant, equipment
			and software capitalization	(25,618)	(38,047)	(90,377)	(119,044)
	Business acquisitions, net of cash acquired			–	–	–	(1,285,907)
	(Investments in) proceeds from unaffiliated companies			(425)	651	(1,489)	651
	Net change in investments			(8)	(5)	(44)	(21)
			Net cash used in investing activities	(26,051)	(37,401)	(91,910)	(1,404,321)

Cash flows from financing activities:
	Net change in debt			(180,000)	(125,181)	(530,000)	929,601
	Proceeds from stock plans			3,237	9,464	25,073	18,092
	Purchases of treasury shares			(141)	(692)	(13,475)	(70,433)
	Other cash flow from financing activities, net			20	2,884	15,305	8,178
			Net cash used in financing activities	(176,884)	(113,525)	(503,097)	885,438

Effect of exchange rate changes on cash and cash equivalents				2,442	(171)	8,461	2,081
			Increase (decrease) in cash and cash equivalents	4,087	6,721	(64,562)	(144,115)

Cash and cash equivalents at beginning of period				326,427	329,693	395,076	480,529
			Cash and cash equivalents at end of period	$ 330,514	$ 336,414	$ 330,514	$ 336,414




Reconciliation of GAAP Cash Flows from Operating Activities to Free Cash Flow ^(a)



Net cash provided by operating activities – GAAP				$ 204,580	$ 157,818	$ 521,984	$ 372,687

	Adjustments:
		Additions to property, plant, equipment
			and software capitalization	(25,618)	(38,047)	(90,377)	(119,044)
		Tax reform payments		–	–	95,645	72,101
		Litigation settlements (received) paid, net		–	(375)	9,250	(1,125)
		Major facility renovations		–	3,291	–	12,151
		Payment of acquired Wyatt liabilities ^(b)		–	–	–	25,617
		Payment of Wyatt retention bonus obligation ^(c)		–	–	19,770	–
Free Cash Flow – Adjusted Non-GAAP				$ 178,962	$ 122,687	$ 556,272	$ 362,387


(a)		The Company defines free cash flow as net cash flow from operations accounted for under GAAP less capital expenditures and software capitalizations plus or minus any unusual and non recurring items. Free cash flow is not a GAAP measurement and may not be comparable to free cash flow reported by other companies.

(b)		In connection with the Wyatt acquisition, the Company assumed certain obligations of Wyatt and paid those obligations immediately upon closing the transaction. The Company believes that the assumed obligations do not represent future ongoing business expenses.

(c)		During the nine months ended September 28, 2024, the Company made its first retention payment under the Wyatt retention bonus program. The Company believes that these payments are not normal and do not represent future ongoing business expenses.

Waters Corporation and Subsidiaries
Reconciliation of Projected GAAP to Adjusted Non-GAAP Financial Outlook


		Twelve Months Ended			Three Months Ended
		December 31, 2024			December 31, 2024
			Range			Range
Projected Sales

Organic constant currency sales growth rate ^(a)		(0.9 %)	–	(0.3 %)	5.0 %	–	7.0 %
Impact of:
	Currency translation	(1.2 %)	–	(1.2 %)	(1.7 %)	–	(1.7 %)
	Acquisitions	1.3 %	–	1.3 %	‒	–	‒
Sales growth rate as reported		(0.8 %)	–	(0.2 %)	3.3 %	–	5.3 %


			Range			Range
Projected Earnings Per Diluted Share

GAAP earnings per diluted share		$ 10.55	–	$ 10.75	$ 3.72	–	$ 3.92
Adjustments:
	Purchased intangibles amortization	$ 0.60	–	$ 0.60	$ 0.15	–	$ 0.15
	Litigation settlement	$ 0.15	–	$ 0.15	$ –	–	$ –
	Restructuring costs and certain other items	$ 0.14	–	$ 0.14	$ –	–	$ –
	Retention bonus obligation	$ 0.23	–	$ 0.23	$ 0.03	–	$ 0.03
Adjusted non-GAAP earnings per diluted share		$ 11.67	–	$ 11.87	$ 3.90	–	$ 4.10


(a) Organic constant currency growth rates are a non-GAAP financial measure that measures the change in net sales between current and prior year periods, excluding the impact of foreign currency exchange rates during the current period and excluding the impact of acquisitions made within twelve months of the acquisition close date. These amounts are estimated at the current foreign currency exchange rates and based on the forecasted geographical sales in local currency, as well as an assessment of market conditions as of today, and may differ significantly from actual results.

These forward-looking adjustment estimates do not reflect future gains and charges that are inherently difficult to predict and estimate due to their unknown timing, effect and/or significance.

Contact: Caspar Tudor, Head of Investor Relations – (508) 482-2429

View original content:https://www.prnewswire.com/news-releases/waters-corporation-nyse-wat-reports-third-quarter-2024-financial-results-302293299.html

SOURCE Waters Corporation

Markets News

S&P 500 Records Worst Session In Over A Month, Meta And Microsoft Tumble: Greed Index Moves To 'Fear' Zone

01.11.2024 by admin

The CNN Money Fear and Greed index showed a decline in the overall market sentiment, while the index moved to the “Fear” zone on Thursday.

U.S. stocks settled lower on Thursday, with the Nasdaq Composite falling more than 500 points during the session. The S&P 500 and Nasdaq both recorded their biggest single-day declines since Sept. 3.

Shares of Meta Platforms Inc. META fell around 4% on Thursday after the company reported third-quarter financial results. Shares of Microsoft Corp. MSFT fell around 6% on Thursday after the company reported first-quarter financial results.

On the economic data front, U.S. initial jobless claims declined by 12,000 from the previous week to 216,000 in the week ending Oct. 26. The personal consumption expenditure price index rose 0.2% month-over-month in September following a 0.1% increase in August.

Most sectors on the S&P 500 closed on a negative note, with information technology, consumer discretionary, and real estate stocks recording the biggest losses on Thursday. However, utilities and energy stocks bucked the overall market trend, closing the session higher.

The Dow Jones closed lower by around 378 points to 41,763.46 on Thursday. The S&P 500 fell 1.86% to 5,705.45, while the Nasdaq Composite fell 2.76% at 18,095.15 during Thursday’s session.

Investors are awaiting earnings results from Chevron Corporation CVX, Exxon Mobil Corporation XOM, and Cardinal Health, Inc. CAH today.

What is CNN Business Fear & Greed Index?

At a current reading of 43.5, the index moved to the “Fear” zone on Thursday, versus a prior reading of 54.

The Fear & Greed Index is a measure of the current market sentiment. It is based on the premise that higher fear exerts pressure on stock prices, while higher greed has the opposite effect. The index is calculated based on seven equal-weighted indicators. The index ranges from 0 to 100, where 0 represents maximum fear and 100 signals maximum greediness.

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Market News and Data brought to you by Benzinga APIs

Earnings News

BrightSpring Health Services, Inc. Reports Third Quarter 2024 Financial Results and Increases Full Year 2024 Guidance

01.11.2024 by admin

LOUISVILLE, Ky., Nov. 01, 2024 (GLOBE NEWSWIRE) — BrightSpring Health Services, Inc. (“BrightSpring” or the “Company”) BTSG, a leading provider of home and community-based health services for complex populations, today announced financial results for the third quarter ended September 30, 2024, and increases 2024 revenue and Adjusted EBITDA¹ guidance.

Financial Highlights

Net Revenue of $2,907 million, up 28.8% compared to $2,257 million in the third quarter of 2023.
Net loss of $9.0 million, compared to net loss of $130.1 million in the third quarter of 2023.
Adjusted EBITDA¹ of $151 million, up 15.7% versus $131 million in the third quarter of 2023
Increased 2024 Revenue and Adjusted EBITDA Guidance:
- Revenue: $11,000 – $11,300 million
- Adjusted EBITDA¹: $580 – $585 million

“We are pleased with the broad-based strength in revenue and earnings growth across Pharmacy Solutions and Providers Services in the third quarter,” said Jon Rousseau, Chairman, President and Chief Executive Officer of the Company. “At BrightSpring we are focused on driving operational excellence and efficiencies while increasing scale across our organization to deliver lower-cost and high-quality care to patients. We are confident that the Company remains well positioned to execute on providing a high level of quality care to patients and continuing to grow our businesses for the remainder of 2024 and in 2025.”

Third Quarter 2024 Financial Results

Net revenue of $2,907 million, up 28.8% compared to $2,257 million in the third quarter of 2023. Net revenue growth was driven by strength across the business, with robust growth in Specialty and Infusion Pharmacy.

Gross profit of $408 million, up 13.9% compared to $358 million in the third quarter of 2023.

Net loss of $9.0 million, compared to net loss of $130.1 million in the third quarter of 2023.

Adjusted EBITDA¹ of $151 million, up 15.7% compared to $131 million in the third quarter of 2023

¹Adjusted EBITDA is a non-GAAP financial measure. Please see “Non-GAAP Financial Information” and the end of this press release for a reconciliation of Adjusted EBITDA to net loss, the most directly comparable financial measure prepared in accordance with GAAP.

Key Financials:

	Three Months Ended
	September 30, (Unaudited)
	2024		2023		%
($ in millions)
Pharmacy Solutions Revenue	$	2,266	$	1,673		35%
Provider Services Revenue		641		583		10%
Total Revenue	$	2,907	$	2,257		29%

	Three Months Ended
	September 30, (Unaudited)
	2024		2023		%
($ in millions)
Pharmacy Solutions segment EBITDA	$	99	$	86		15%
Provider Services segment EBITDA		93		81		14%
Total Segment Adjusted EBITDA	$	192	$	168		14%
Corporate Costs		(41)		(37)		–
Total Company Adjusted EBITDA	$	151	$	131		15.7%

Full Year 2024 Financial Guidance

For the full year 2024, BrightSpring is increasing guidance, which excludes the effects of any future closed acquisitions.

Net revenue of $11,000 million to $11,300 million, or 24.6% to 28.0% growth over 2023
- Pharmacy Segment Revenue of $8,500 million to $8,750 million, or 30.3% to 34.2% growth over full year 2023
- Provider Segment Revenue of $2,500 million to $2,550 million, or 8.5% to 10.7% growth over full year 2023
Adjusted EBITDA² of $580 million to $585 million, or 14.2% to 15.2% growth over full year 2023, excluding the impact from a certain Quality Incentive Payment in 2023

A copy of the Company’s third quarter earnings presentation is available on the company’s investor relations website, https://ir.brightspringhealth.com/

² A reconciliation of the foregoing guidance for the non-GAAP metric of Adjusted EBITDA to GAAP net loss cannot be provided without unreasonable effort because of the inherent difficulty of accurately forecasting the occurrence and financial impact of the various adjusting items necessary for such reconciliation that have not yet occurred, are out of our control, or cannot be reasonably predicted. For the same reasons, the Company is unable to assess the probable significance of the unavailable information, which could have a material impact on its future GAAP financial results.

Webcast and Conference Call Details

BrightSpring will host a conference call today, November 1, 2024, at 8:30 a.m. Eastern Time. Investors interested in listening to the conference call are required to register online.

A live and archived webcast of the event will be available on the “Events & Presentations” section of the BrightSpring website at https://ir.brightspringhealth.com/. The Company has posted supplemental financial information on the third quarter results that it will reference during the conference call. The supplemental information can be found under the “Events & Presentations” on the Company’s investor relations page.

About BrightSpring Health Services

BrightSpring Health Services provides complementary and integrated home- and community-based pharmacy and health solutions for complex populations in need of specialized and/or chronic care. Through the Company’s service lines, including pharmacy, home health care and primary care, and rehabilitation and behavioral health, we provide comprehensive care and clinical solutions in all 50 states to over 400,000 customers, clients and patients daily.

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect our current views with respect to, among other things, our operations and financial performance. Forward-looking statements include all statements that are not historical facts. These forward-looking statements may relate to matters which include, but are not limited to, industries, business strategy, goals and expectations concerning our market position, future operations, margins, profitability, capital expenditures, liquidity and capital resources and other financial and operating information. In some cases, we have used words such as “anticipate,” “assume,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “future,” “will,” “seek,” “foreseeable,” “target,” “guidance,” the negative version of these words, or similar terms and phrases to identify these forward-looking statements.

The forward-looking statements are based on management’s current expectations and are not historical facts or guarantees of future performance. The forward-looking statements relate to the future and are therefore subject to various risks, uncertainties, assumptions, or changes in circumstances that are difficult to predict or quantify. Our expectations, beliefs, and projections are expressed in good faith and we believe there is a reasonable basis for them. However, there can be no assurance that management’s expectations, beliefs, and projections will result or be achieved. Actual results may differ materially from these expectations due to changes in global, regional, or local economic, business, competitive, market, regulatory, and other factors, many of which are beyond our control. We believe that these factors include but are not limited to the following:

our operation in a highly competitive industry;
our inability to maintain relationships with existing patient referral sources or establish new referral sources;
changes to Medicare and Medicaid rates or methods governing Medicare and Medicaid payments for our services;
cost containment initiatives of third-party payors, including post-payment audits;
the implementation of alternative payment models and the transition of Medicaid and Medicare beneficiaries to managed care organizations may limit our market share and could adversely affect our revenues;
changes in the case mix of patients, as well as payor mix and payment methodologies, and decisions and operations of third-party organizations;
our reliance on federal and state spending, budget decisions, and continuous governmental operations which may fluctuate under different political conditions;
changes in drug utilization and/or pricing, PBM contracts, and Medicare Part D/Medicaid reimbursement, which may negatively impact our profitability;
changes in our relationships with pharmaceutical suppliers, including changes in drug availability or pricing;
reliance on the continual recruitment and retention of nurses, pharmacists, therapists, caregivers, direct support professionals, and other qualified personnel, including senior management;
compliance with or changes to federal, state, and local laws and regulations that govern our employment practices, including minimum wage, living wage, and paid time-off requirements;
fluctuation of our results of operations on a quarterly basis;
harm caused by labor relation matters;
limitations in our ability to control reimbursement rates received for our services if we are unable to maintain or reduce our costs to provide such services;
delays in collection or non-collection of our accounts receivable, particularly during the business integration process;
failure to manage our growth effectively, which may inhibit our ability to execute our business plan, maintain high levels of service and satisfaction or adequately address competitive challenges;
our ability to identify, successfully complete and manage acquisitions, joint ventures, and other strategic initiatives;
our ability to continue to provide consistently high quality of care;
maintenance of our corporate reputation or the emergence of adverse publicity, including negative information on social media or changes in public perception of our services;
contract continuance, expansion and renewal with our existing customers, including renewals at lower fee levels, customers declining to purchase additional services from us, or reduction in the services received from us pursuant to those contracts;
effective investment in, implementation of improvements to and proper maintenance of the uninterrupted operation and data integrity of our information technology and other business systems;
security breaches, loss of data, and other disruptions, which could compromise sensitive business or patient information; cause a loss of confidential patient data, employee data or personal information; or prevent access to critical information and thereby expose us to liability, litigation, and federal and state governmental inquiries and damage our reputation and brand;
risks related to credit card payments and other payment methods;
potential substantial malpractice or other similar claims;
various risks related to governmental inquiries, regulatory actions, and whistleblower and other lawsuits, which may not be entirely covered by insurance;
our current insurance program, which may expose us to unexpected costs, particularly if we incur losses not covered by our insurance or if claims or losses differ from our estimates;
factors outside of our control, including those listed, which have required and could in the future require us to record an asset impairment of goodwill;
a pandemic, epidemic, or outbreak of an infectious disease, including the ongoing effects of COVID-19;
inclement weather, natural disasters, acts of terrorism, riots, civil insurrection or social unrest, looting, protests, strikes, or street demonstrations;
our inability to adequately protect our intellectual property rights

The forward-looking statements included in this press release are made only as of the date of this press release, and we undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments, or otherwise, except as required by law. These factors should not be construed as exhaustive, and should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, our actual results may vary in material respects from those projected in these forward-looking statements. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We may not actually achieve the plans, intentions, or expectations disclosed in our forward-looking statements and you should not place undue reliance on our forward-looking statements. Our forward- looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures, investments, or other strategic transactions we may make.

For additional information on these and other factors that could cause BrightSpring’s actual results to differ materially from expected results, please see our filings with the Securities and Exchange Commission (the “SEC”), which are accessible on the SEC’s website at www.sec.gov.

Non-GAAP Financial Measures

This press release contains “non-GAAP financial measures,” including “EBITDA” and “Adjusted EBITDA,” which are financial measures that either exclude or include amounts that are not excluded or included in the most directly comparable measures calculated and presented in accordance with accounting principles generally accepted in the United States, or GAAP.

EBITDA and Adjusted EBITDA have been presented in this release as supplemental measures of financial performance that are not required by, or presented in accordance with, GAAP, because we believe they assist investors and analysts in comparing our operating performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance. Management also believes that these measures are useful to investors in highlighting trends in our operating performance, while other measures can differ significantly depending on long-term strategic decisions regarding capital structure, the tax jurisdictions in which we operate and capital investments. Management uses EBITDA and Adjusted EBITDA to supplement GAAP measures of performance in the evaluation of the effectiveness of our business strategies, to make budgeting decisions, to establish and award discretionary annual incentive compensation, and to compare our performance against that of other peer companies using similar measures.

Management supplements GAAP results with non-GAAP financial measures to provide a more complete understanding of the factors and trends affecting the business than GAAP results alone. EBITDA and Adjusted EBITDA are not GAAP measures of our financial performance and should not be considered as an alternative to net loss as a measure of financial performance or any other performance measures derived in accordance with GAAP. Additionally, these measures are not intended to be a measure of free cash flow available for management’s discretionary use as they do not consider certain cash requirements such as tax payments, debt service requirements, total capital expenditures, and certain other cash costs that may recur in the future.

Management defines EBITDA as net loss before income tax expense (benefit), interest expense, and depreciation and amortization. Management also defines Adjusted EBITDA as EBITDA, further adjusted to exclude non-cash share-based compensation, acquisition, integration and transaction-related costs, restructuring and divestiture-related and other costs, goodwill impairment, legal costs and settlements associated with certain historical matters for PharMerica, significant projects, management fees, and unreimbursed COVID-19 related costs.

The presentations of these measures have limitations as analytical tools and should not be considered in isolation, or as a substitute for analysis of our results as reported under GAAP. Because not all companies use identical calculations, the presentations of these measures may not be comparable to other similarly titled measures of other companies and can differ significantly from company to company. Please see the end of this press release for reconciliations of non-GAAP financial measures to the most directly comparable financial measure prepared in accordance with GAAP.

BrightSpring Contact:

Investor Relations:
David Deuchler, CFA
Gilmartin Group LLC
ir@brightspringhealth.com

Media Contact:
Leigh White
leigh.white@brightspringhealth.com
502.630.7412


BrightSpring Health Services, Inc. and Subsidiaries Condensed Consolidated Balance Sheets September 30, 2024 and December 31, 2023 (In thousands, except share and per share data) (Unaudited)

	September 30, 2024			December 31, 2023
Assets
Current assets:
Cash and cash equivalents	$	35,973		$	13,071
Accounts receivable, net of allowance for credit losses		1,025,711			881,627
Inventories		478,319			402,776
Prepaid expenses and other current assets		169,582			159,167
Total current assets		1,709,585			1,456,641
Property and equipment, net of accumulated depreciation of $426,484 and $368,089 at September 30, 2024 and December 31, 2023, respectively		248,548			245,908
Goodwill		2,672,791			2,608,412
Intangible assets, net of accumulated amortization		842,479			881,476
Operating lease right-of-use assets, net		259,138			267,446
Deferred income taxes, net		6,678			—
Other assets		46,748			72,838
Total assets	$	5,785,967		$	5,532,721
Liabilities, Redeemable Noncontrolling Interests, and Equity
Current liabilities:
Trade accounts payable	$	783,838		$	641,607
Accrued expenses		349,101			492,363
Current portion of obligations under operating leases		69,763			71,053
Current portion of obligations under financing leases		12,367			11,141
Current portion of long-term debt		48,853			32,273
Total current liabilities		1,263,922			1,248,437
Obligations under operating leases, net of current portion		195,921			201,655
Obligations under financing leases, net of current portion		24,988			22,528
Long-term debt, net of current portion		2,608,537			3,331,941
Deferred income taxes, net		—			23,668
Long-term liabilities		73,502			91,943
Total liabilities		4,166,870			4,920,172
Redeemable noncontrolling interests		4,125			27,139
Shareholders’ equity:
Common stock, $0.01 par value, 1,500,000,000 and 137,398,625 shares authorized, 174,078,977 and 117,857,055 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively		1,741			1,179
Preferred stock, $0.01 par value, 250,000,000 authorized, no shares issued and outstanding at September 30, 2024; no shares authorized, issued or outstanding at December 31, 2023		—			—
Additional paid-in capital		1,848,115			771,336
Accumulated deficit		(234,380	)		(200,319	)
Accumulated other comprehensive (loss) income		(705	)		12,544
Total shareholders’ equity		1,614,771			584,740
Noncontrolling interest		201			670
Total equity		1,614,972			585,410
Total liabilities, redeemable noncontrolling interests, and equity	$	5,785,967		$	5,532,721

BrightSpring Health Services, Inc. and Subsidiaries Condensed Consolidated Statements of Operations For the three and nine months ended September 30, 2024 and 2023 (In thousands, except per share amounts) (Unaudited)

	For the Three Months Ended						For the Nine Months Ended
	September 30,						September 30,
	2024			2023			2024			2023
Revenues:
Products	$	2,265,697		$	1,673,152		$	6,357,223		$	4,736,993
Services		641,126			583,377			1,856,448			1,714,638
Total revenues		2,906,823			2,256,529			8,213,671			6,451,631
Cost of goods		2,077,121			1,509,845			5,815,981			4,226,075
Cost of services		421,590			388,388			1,231,154			1,160,477
Gross profit		408,112			358,296			1,166,536			1,065,079
Selling, general, and administrative expenses		351,272			410,549			1,039,215			986,161
Operating income (loss)		56,840			(52,253	)		127,321			78,918
Loss on extinguishment of debt		—			—			12,726			—
Interest expense, net		56,061			83,678			173,520			241,539
Income (loss) before income taxes		779			(135,931	)		(58,925	)		(162,621	)
Income tax expense (benefit)		9,760			(5,807	)		(23,000	)		(12,987	)
Net loss		(8,981	)		(130,124	)		(35,925	)		(149,634	)
Net (loss) income attributable to noncontrolling interests		(751	)		548			(1,864	)		(1,568	)
Net loss attributable to BrightSpring Health Services, Inc. and subsidiaries	$	(8,230	)	$	(130,672	)	$	(34,061	)	$	(148,066	)

Net loss per common share:
Loss per share – basic	$	(0.04	)	$	(1.11	)	$	(0.18	)	$	(1.26	)
Loss per share – diluted	$	(0.04	)	$	(1.11	)	$	(0.18	)	$	(1.26	)
Weighted average shares outstanding:
Basic		198,491			117,864			190,541			117,871
Diluted		198,491			117,864			190,541			117,871

BrightSpring Health Services, Inc. and Subsidiaries Condensed Consolidated Statements of Cash Flows For the three and nine months ended September 30, 2024 and 2023 (In thousands) (Unaudited)

	For the Three Months Ended						For the Nine Months Ended
	September 30,						September 30,
	2024			2023			2024			2023
Operating activities:
Net loss	$	(8,981	)	$	(130,124	)	$	(35,925	)	$	(149,634	)
Adjustments to reconcile net loss to cash provided by (used in) operating activities:
Depreciation and amortization		50,608			50,774			149,601			151,324
Impairment of long-lived assets		2,801			2,181			4,781			8,295
Provision for credit losses		8,778			6,753			21,896			18,927
Amortization of deferred debt issuance costs		2,540			5,182			9,477			15,691
Share-based compensation		15,210			825			55,194			2,100
Deferred income taxes, net		21,479			(10,810	)		(27,781	)		(36,565	)
Loss on extinguishment of debt		—			—			12,726			—
(Gain) loss on disposition of fixed assets		(79	)		438			(55	)		957
Other		479			(582	)		(959	)		(210	)
Change in operating assets and liabilities, net of acquisitions and dispositions:
Accounts receivable		(51,474	)		(11,520	)		(163,996	)		(116,922	)
Prepaid expenses and other current assets		(24,207	)		(22,272	)		(2,470	)		(162	)
Inventories		(103,985	)		16,536			(74,265	)		53,244
Trade accounts payable		114,234			31,353			155,563			(58,313	)
Accrued expenses		3,860			89,671			(150,032	)		159,353
Other assets and liabilities		(4,017	)		5,286			(20,593	)		298
Net cash provided by (used in) operating activities	$	27,246		$	33,691		$	(66,838	)	$	48,383
Investing activities:
Purchases of property and equipment	$	(20,043	)	$	(17,899	)	$	(65,602	)	$	(56,693	)
Acquisitions of businesses, net of cash acquired		(17,225	)		(37,044	)		(59,755	)		(62,508	)
Other		360			296			900			1,790
Net cash used in investing activities	$	(36,908	)	$	(54,647	)	$	(124,457	)	$	(117,411	)
Financing activities:
Long-term debt borrowings	$	—		$	—		$	2,566,000		$	—
Long-term debt repayments		(13,663	)		(7,536	)		(3,384,633	)		(22,857	)
Proceeds from issuance of common stock on initial public offering, net		—			—			656,485			—
Proceeds from issuance of tangible equity units, net		—			—			389,000			—
Borrowings of the Revolving Credit Facility, net		41,300			31,650			46,400			98,250
Payment of debt issuance costs		—			—			(43,188	)		—
Repurchase of shares of common stock		—			(325	)		(650	)		(325	)
Shares issued under share-based compensation plan, including tax effects		127			453			531			598
Payment of acquisition earn-outs		(1,500	)		—			(4,156	)		—
Purchase of redeemable noncontrolling interest		(2,016	)		—			(2,316	)		—
Payment of financing lease obligations		(3,640	)		(2,901	)		(9,276	)		(8,625	)
Net cash provided by financing activities	$	20,608		$	21,341		$	214,197		$	67,041
Net increase (decrease) in cash and cash equivalents		10,946			385			22,902			(1,987	)
Cash and cash equivalents at beginning of year		25,027			11,256			13,071			13,628
Cash and cash equivalents at end of year	$	35,973		$	11,641		$	35,973		$	11,641

BrightSpring Health Services, Inc. and Subsidiaries
Reconciliation of EBITDA and Adjusted EBITDA
For the three and nine months ended September 30, 2024 and 2023
(Unaudited)

The following table reconciles net loss to EBITDA and Adjusted EBITDA:

($ in thousands)	For the Three Months Ended						For the Nine Months Ended
	September 30,						September 30,
	2024			2023			2024			2023
Net loss	$	(8,981	)	$	(130,124	)	$	(35,925	)	$	(149,634	)
Income tax expense (benefit)		9,760			(5,807	)		(23,000	)		(12,987	)
Interest expense, net		56,061			83,678			173,520			241,539
Depreciation and amortization		50,608			50,774			149,601			151,324
EBITDA	$	107,448		$	(1,479	)	$	264,196		$	230,242
Non-cash share-based compensation (1)		15,210			825			55,194			2,100
Acquisition, integration, and transaction-related costs (2)		11,767			6,319			25,331			13,754
Restructuring and divestiture-related and other costs (3)		6,672			4,527			28,065			16,172
Legal costs and settlements (4)		8,920			117,042			21,886			121,706
Significant projects (5)		1,000			1,935			2,604			6,899
Management fee (6)		—			1,383			23,381			4,248
Unreimbursed COVID-19 related costs		—			(48	)		—			88
Total adjustments	$	43,569		$	131,983		$	156,461		$	164,967
Adjusted EBITDA	$	151,017		$	130,504		$	420,657		$	395,209

(1)	Represents non-cash share-based compensation to certain members of our management and full-time employees. The three and nine months ended September 30, 2024 includes $14.4 million and $35.8 million of costs, respectively, related to new equity awards granted upon the completion of our IPO under the 2024 Equity Incentive Plan. The nine months ended September 30, 2024 includes $15.0 million of previously unrecognized share-based compensation expense related to performance-vesting options under the 2017 Stock Plan, a portion of which vested upon completion of the IPO.

(2)	Represents transaction costs incurred in connection with planned, completed, or terminated acquisitions, which include investment banking fees, legal diligence and related documentation costs, finance and accounting diligence and documentation; costs associated with the integration of acquisitions, including any facility consolidation, integration travel, or severance; and costs associated with other planned, completed, or terminated non-routine transactions. The three months ended September 30, 2024 includes acquisition and integration related costs of $7.5 million, earn-out adjustments from previous acquisitions of $0.9 million, and other non-routine transaction costs of $2.9 million, as compared to acquisition and integration related costs of $3.7 million and other non-routine transaction costs of $0.9 million for the three months ended September 30, 2023. These costs also included $0.5 million and $6.0 million of costs related to the IPO Offerings which were not capitalizable for the three and nine months ended September 30, 2024, respectively, compared to $1.7 million and $1.9 million for the three and nine months ended September 30, 2023, respectively.

(3)	Represents costs associated with restructuring-related activities, including closure, and related license impairment, and severance expenses associated with certain enterprise-wide or significant business line cost-savings measures. These costs included $12.7 million of unamortized debt issuance costs associated with the extinguishment of our Second Lien Facility in the nine months ended September 30, 2024. These costs also included $1.8 million and $3.7 million of intangible asset and other non-cash investment impairment for the three and nine months ended September 30, 2024, respectively, as compared to $1.4 million and $7.4 million for the three and nine months ended September 30, 2023, respectively.

(4)	Represents settlement and defense costs associated with certain historical PharMerica litigation matters, including the Silver matter, all of which are expected to be completed in 2024. See Note 10 within the unaudited condensed consolidated financial statements and related notes in this Quarterly Report on Form 10-Q for additional information.

(5)	Represents costs associated with certain transformational projects and for the periods presented primarily included general ledger system implementation and pharmacy billing system implementation, which both completed in the second fiscal quarter of 2024; and ransomware attack response costs. Ransomware attack response costs were $1.0 million for the three and nine months ended September 30, 2024, compared to $0.6 million and $3.1 million for the three and nine months ended September 30, 2023, respectively.

(6)	Represents annual management fees payable to the Managers under the Monitoring Agreement through the date of the IPO, and $22.7 million of termination fees resulting from the Monitoring Agreement being terminated upon completion of the IPO Offerings. All management fees have ceased following the completion of the IPO.

BrightSpring Health Services, Inc. and Subsidiaries
Reconciliation of Adjusted EPS
For the three and nine months ended September 30, 2024 and 2023
(Unaudited)

The following table reconciles diluted EPS to Adjusted EPS:

(shares in thousands)	For the Three Months Ended						For the Nine Months Ended
	September 30,						September 30,
	2024			2023			2024			2023
Diluted EPS	$	(0.04	)	$	(1.11	)	$	(0.18	)	$	(1.26	)
Non-cash share-based compensation (1)		0.07			0.01			0.28			0.02
Acquisition, integration, and transaction-related costs (1)		0.06			0.05			0.13			0.11
Restructuring and divestiture-related and other costs (1)		0.03			0.04			0.14			0.13
Legal costs and settlements (1)		0.04			0.93			0.11			0.96
Significant projects (1)		—			0.02			0.01			0.05
Management fee (1)		—			0.01			0.12			0.03
Unreimbursed COVID-19 related costs (1)		—			—			—			—
Income tax impact on adjustments (2)(3)		(0.05	)		(0.03	)		(0.27	)		(0.10	)
Adjusted EPS	$	0.11		$	(0.08	)	$	0.34		$	(0.06	)

Weighted average common shares outstanding used in calculating diluted U.S. GAAP net loss per share		198,491			117,864			190,541			117,871
Weighted average common shares outstanding used in calculating diluted Non-GAAP earnings (loss) per share		208,694			126,346			199,930			126,428

(1)	This adjustment reflects the per share impact of the adjustment reflected within the definition of Adjusted EBITDA.

(2)	The income tax impact of non-GAAP adjustments is calculated using the estimated tax rate for the respective non-GAAP adjustment.

(3)	For the nine months ended September 30, 2024, the income tax impact on adjustments is inclusive of a discrete tax benefit related to the Silver matter that was finalized in connection with the signing of the settlement agreement during the second fiscal quarter of 2024.

Markets News

Trump Loses $1.9B In Net Worth As DJT Stock Tumbles 2nd Time This Week

01.11.2024 by admin

Former President Donald Trump has seen a significant decline in his net worth, losing approximately $1.9 billion due to a steep drop in Trump Media & Technology Group Corp DJT stock.

What Happened: According to Benzinga Pro, DJT shares fell by 11.72%, closing at $35.34 on Thursday. This followed a 22% decline on Wednesday after the stock had reached an intraday high of $54.68 on Tuesday. The reasons for the two-day sell-off remain unclear, but the stock has attracted the attention of speculators and shortsellers.

S3 Partners, a research group, indicated that the surge in DJT shares during October might have been driven by short sellers covering their positions, resulting in a short squeeze. They noted the stock’s high squeeze risk due to limited float and significant short interest, which is closely linked to Trump’s election prospects, CBS News reported on Thursday.

Trump, the largest shareholder with around 115 million shares in Trump Media, saw his stake’s value drop from nearly $6.3 billion at Tuesday’s peak to about $4 billion based on Thursday’s closing price.

Trump Media and his company are yet to respond to Benzinga’s queries.

Why It Matters: The volatility in DJT stock is not new, as it has been highly unpredictable since going public following a SPAC merger. The stock’s movements are closely tied to Trump’s 2024 election prospects, with potential outcomes significantly impacting its value. According to a report from S3 Partners, a Trump victory could push the stock to $60, while a loss might render shares “worthless.”

Earlier this week, DJT stock experienced multiple vola tility halts as prices fluctuated significantly. The stock was halted several times on Tuesday, reflecting its unpredictable nature and the market’s sensitivity to political developments.

Read Next:

Image via Shutterstock

This story was generated using Benzinga Neuro and edited by Pooja Rajkumari

Market News and Data brought to you by Benzinga APIs

Earnings News

Biodesix Announces Third Quarter 2024 Results and Highlights

01.11.2024 by admin

Q3 2024 revenue grew 35% over Q3 2023 to $18.2 million;

Q3 2024 gross profit margin of 77.0%, up from 76.1% in Q3 2023;

Q3 2024 Net loss improved by 6% compared to Q3 2023;

Conference Call and Webcast Today at 8:30 a.m. ET

LOUISVILLE, Colo., Nov. 01, 2024 (GLOBE NEWSWIRE) — Biodesix, Inc. BDSX, a leading diagnostic solutions company, today announced its financial and operating results for the third quarter ended September 30, 2024.

“The Biodesix team is pleased to report another solid quarter focused on executing and delivering on our three main goals – driving revenue growth through the adoption of our lung diagnostic tests and biopharma services, continued implementation of operational efficiencies, and maintaining a cost-disciplined approach as we drive our business to profitability,” said Scott Hutton, CEO of Biodesix.

“We reported 40% year-over-year growth in lung diagnostics revenue, a growing book of biopharma services contracts, sustained gross margins in the high 70% range, and improved Net Loss on our path to profitability. In addition, at the annual meeting of the American College of Chest Physicians (CHEST), we presented new clinical data on our Nodify XL2® and Nodify CDT® tests, and announced a new clinical study (CLARIFY) to expand our data in diverse patient populations tested in a real-world clinical setting. Building on this momentum, we are reiterating our prior guidance of $70-$72 million for 2024 and we look forward to achieving Adjusted EBITDA profitability in the second half of 2025. At Biodesix, our tests play a vital role in treating the deadliest of all cancers. Our committed and driven team embraces the opportunity, and the responsibility, to transform the standard of care to improve outcomes for patients.”

Third Quarter Ended September 30, 2024 Business Highlights

Grew Lung Diagnostic test volume to 13,900, a 34% improvement over the third quarter of 2023.
Quarterly gross profit margin of 77.0% versus 76.1% for the third quarter of 2023.
Presented compelling new data at the CHEST Annual Meeting and announced the launch of a new clinical study, CLARIFY.
- New data was presented detailing the experience of healthcare providers using the Nodify Lung® Nodule Risk Assessment Tests (Nodify XL2 and Nodify CDT tests) in over 35,000 patients tested in a real-world clinical setting. Results shared were consistent with prior studies, highlighting the high proportion of results that up- or down-classify patients into actionable risk categories with clear, guideline-recommended, diagnostic plans.
- The new study, CLARIFY, is designed to confirm performance of the Nodify CDT and Nodify XL2 tests in diverse patient subgroups through a retrospective chart review of up to 4,000 patients that were tested in a real-world clinical setting. The study’s intent is to expand the extensive evidence characterizing the validation and utility of Nodify Lung testing.

Third Quarter Ended September 30, 2024 Financial Highlights

Total revenue of $18.2 million, an increase of 35% over the third quarter 2023:
- Lung Diagnostic revenue of $17.2 million reflected a year-over-year increase of 40% driven by the continued adoption of Nodify XL2 and Nodify CDT nodule risk assessment tests and strong reimbursement. However, test volumes were impacted at the end of the third quarter by disruption to patients, healthcare providers, and Biodesix teammates in the southeast due to Hurricane Helene;
- Biopharmaceutical Services revenue of $1.0 million decreased 17% year-over-year, driven by the timing of receipt of samples and shift of the completion of certain projects from the end of the third quarter into the beginning of the fourth;
Third quarter 2024 gross profit of $14.0 million, or 77.0% gross margin compared to 76.1% gross margin in the comparable prior year period. Our steady margin performance is primarily driven by volume growth in Lung Diagnostic testing that continues to drive down the per test costs;
Operating expenses (excluding direct costs and expenses) of $22.6 million, an increase of 29% as compared to the third quarter 2023, which includes $3.0 million of non-cash stock compensation expense and depreciation and amortization as compared to $1.7 million in third quarter of 2023. This increase is primarily attributable to an increase in sales and marketing costs to support both business lines’ sales growth to enhance product awareness and drive adoption, and an increase in depreciation expense related to the leasehold improvements in the Company’s Louisville, CO offices and laboratory which opened in January 2024;
Net loss of $10.3 million, an improvement of 6% as compared to the same period of 2023;
Adjusted EBITDA was a loss of $5.6 million, a slight increase over the loss of $5.4 million in the third quarter of 2023 and consistent with the second quarter of 2024;
Cash and cash equivalents of $31.4 million as of September 30, 2024, a decrease from $42.2 million from June 30, 2024;
- Cash and cash equivalents as of September 30, 2024 includes the final milestone payment of $6.1 million for the acquisition of Integrated Diagnostics in 2018.

2024 – 2025 Financial Outlook

The Company is reiterating the 2024 revenue forecast of between $70 million and $72 million.

Conference call and webcast information

Listeners can register for the webcast via this link. Analysts who wish to participate in the question-and-answer session should use this link. A replay of the webcast will be available via the Company’s investor relations page on the website approximately two hours after the call’s conclusion. Participants are advised to join 15 minutes prior to the start time.

For a full list of Biodesix press releases and webinars, please visit biodesix.com.

About Biodesix

Biodesix is a leading diagnostic solutions company with five Medicare-covered tests available for patients with lung diseases. The blood-based Nodify Lung® Nodule Risk Assessment, consisting of the Nodify XL2® and the Nodify CDT® tests, evaluates the risk of malignancy in pulmonary nodules, enabling physicians to better triage patients to the most appropriate course of action. The blood-based IQLung™ test portfolio for lung cancer patients integrates the GeneStrat® targeted ddPCR™ test, the GeneStrat NGS® test, and the VeriStrat® test to support treatment decisions across all stages of lung cancer and expedite personalized treatment. In addition, Biodesix collaborates with the world’s leading biopharmaceutical companies to provide biomarker discovery, diagnostic test development, and clinical trial support services. For more information about Biodesix, visit biodesix.com.

Trademarks: Biodesix, Nodify Lung, Nodify XL2, Nodify CDT, IQLung, GeneStrat, GeneStrat NGS, and VeriStrat are trademarks or registered trademarks of Biodesix, Inc. The ddPCR technology is a trademark of Bio-Rad Laboratories, Inc.

Use of Non-GAAP Financial Measure

Biodesix reported results are presented in accordance with generally accepted accounting principles in the United States (GAAP). Biodesix has provided in this press release financial information that has not been prepared in accordance with GAAP. Biodesix uses the non-GAAP financial measure, Adjusted EBITDA, internally in analyzing its financial results and believes that use of this non-GAAP financial measure is useful to investors as an additional tool to evaluate ongoing operating results and trends and in comparing Biodesix financial results with other companies in its industry, many of which present similar non-GAAP financial measures. Non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP financial measures and should be read only in conjunction with Biodesix financial statements prepared in accordance with GAAP. A reconciliation of Biodesix historical non-GAAP financial measure to the most directly comparable GAAP measure has been provided in the financial statement tables included in this press release, and investors are encouraged to review the reconciliation.

Adjusted EBITDA is a key performance measure that our management uses to assess our financial performance and is also used for internal planning and forecasting purposes. We believe that this non-GAAP financial measure is useful to investors and other interested parties in analyzing our financial performance because it provides a comparable overview of our operations across historical periods. In addition, we believe that providing Adjusted EBITDA, together with a reconciliation of Net loss to Adjusted EBITDA, helps investors make comparisons between our Company and other companies that may have different capital structures, different tax rates, and/or different forms of employee compensation.

Adjusted EBITDA is used by our management team as an additional measure of our performance for purposes of business decision-making, including managing expenditures. Period-to-period comparisons of Adjusted EBITDA help our management identify additional trends in our financial results that may not be shown solely by period- to-period comparisons of Net loss or Loss from operations. Our management recognizes that Adjusted EBITDA has inherent limitations because of the excluded items and may not be directly comparable to similarly titled metrics used by other companies.

We calculate Adjusted EBITDA as Net loss adjusted to exclude interest, income tax expense, if any, depreciation and amortization, share-based compensation expense, loss on debt extinguishments, net, COVID-19 revenue, COVID-19 direct costs and expenses, change in fair value of warrant liabilities, net, other income, net, and other non-recurring items. Non-recurring items are excluded as they are not representative of our underlying operating performance. We also exclude revenue and direct costs and expenses associated with COVID-19 because we believe that these revenues and expenses do not reflect expected future operating results as they do not represent our Lung Diagnostic and Biopharmaceutical Services business. Adjusted EBITDA should be viewed as a measure of operating performance that is a supplement to, and not a substitute for Loss from operations, Net loss, and other GAAP measures.

Note Regarding Forward-Looking Statements

This press release may contain forward-looking statements that involve substantial risks and uncertainties for purposes of the safe harbor provided by the Private Securities Litigation Reform Act of 1995. All statements contained in this press release other than statements of historical fact, are forward-looking statements. The words “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “plan,” “expect,” “predict,” “potential,” “opportunity,” “goals,” or “should,” and similar expressions are intended to identify forward-looking statements. Such statements are based on management’s current expectations and involve risks and uncertainties. Actual results and performance could differ materially from those projected in the forward-looking statements as a result of many factors. Biodesix has based these forward-looking statements largely on its current expectations and projections about future events and trends. These forward-looking statements are subject to a number of risks, uncertainties, and assumptions. Forward-looking statements may include information concerning the impact of backlog and the timing and assumptions regarding collection of revenues on projections, availability of funds and future capital including under the term loan facility, expectations regarding revenue and margin growth and its impact on profitability, and the impact of a pandemic, epidemic, or outbreak, including the COVID-19 pandemic, on Biodesix and its operations and financial performance. Forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified. The Company’s ability to continue as a going concern could cause actual results to differ materially from those contemplated in this press release and additionally, other factors that could cause actual results to differ materially from those contemplated in this press release can be found in the Risk Factors section of Biodesix most recent annual report on Form 10-K, filed March 1, 2024 or subsequent quarterly reports on Form 10-Q during 2024, if applicable. Biodesix undertakes no obligation to revise or publicly release the results of any revision to such forward-looking statements, except as required by law. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. All forward-looking statements are qualified in their entirety by this cautionary statement.

Contacts:
Media:
Natalie St. Denis
natalie.stdenis@
biodesix.com
(720) 925-9285

Investors:
Chris Brinzey
chris.brinzey@
westwicke.com
(339) 970-2843

Biodesix, Inc. Condensed Balance Sheets (unaudited) (in thousands, except share data)

	September 30, 2024			December 31, 2023
Assets
Current assets
Cash and cash equivalents	$	31,406		$	26,284
Accounts receivable, net of allowance for credit losses of $246 and $65		8,036			7,679
Other current assets		4,575			5,720
Total current assets		44,017			39,683
Non-current assets
Property and equipment, net		28,683			27,867
Intangible assets, net		6,438			7,911
Operating lease right-of-use assets		1,918			1,745
Goodwill		15,031			15,031
Other long-term assets		6,656			6,859
Total non-current assets		58,726			59,413
Total assets	$	102,743		$	99,096

Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable	$	2,537		$	2,929
Accrued liabilities		8,553			7,710
Deferred revenue		676			324
Current portion of operating lease liabilities		624			252
Current portion of contingent consideration		—			21,857
Current portion of notes payable		29			51
Other current liabilities		544			293
Total current liabilities		12,963			33,416
Non-current liabilities
Long-term notes payable, net of current portion		36,112			35,225
Long-term operating lease liabilities		25,191			25,163
Other long-term liabilities		620			712
Total non-current liabilities		61,923			61,100
Total liabilities		74,886			94,516
Commitments and contingencies
Stockholders’ equity
Preferred stock, $0.001 par value, 5,000,000 authorized; 0 (2024 and 2023) issued and outstanding		—			—
Common stock, $0.001 par value, 200,000,000 authorized; 145,465,941 (2024) and 96,235,883 (2023) shares issued and outstanding		145			96
Additional paid-in capital		481,958			424,050
Accumulated deficit		(454,246	)		(419,566	)
Total stockholders’ equity		27,857			4,580
Total liabilities and stockholders’ equity	$	102,743		$	99,096

Biodesix, Inc. Condensed Statements of Operations (unaudited) (in thousands, except per share data)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2024			2023			2024			2023
Revenues
Diagnostic Testing revenue	$	17,168		$	12,301		$	47,503		$	32,395
Biopharmaceutical Services and other revenue		983			1,190			3,391			2,024
Total revenues		18,151			13,491			50,894			34,419
Direct costs and expenses		4,179			3,229			11,231			9,636
Research and development		2,547			1,938			7,145			8,099
Sales, marketing, general and administrative		20,016			15,496			60,232			51,136
Impairment loss on intangible assets		—			—			135			20
Total operating expenses		26,742			20,663			78,743			68,891
Loss from operations		(8,591	)		(7,172	)		(27,849	)		(34,472	)
Other (expense) income:
Interest expense		(2,041	)		(2,386	)		(6,506	)		(7,207	)
Loss on extinguishment of liabilities		—			—			(248	)		—
Change in fair value of warrant liability, net		—			(1,393	)		—			(1,332	)
Other (expense) income, net		374			2			(77	)		4
Total other expense		(1,667	)		(3,777	)		(6,831	)		(8,535	)


Net loss	$	(10,258	)	$	(10,949	)	$	(34,680	)	$	(43,007	)
Net loss per share, basic and diluted	$	(0.07	)	$	(0.14	)	$	(0.28	)	$	(0.55	)
Weighted-average shares outstanding, basic and diluted		146,296			79,709			123,634			78,672

Biodesix, Inc. Reconciliation of Net Loss to Adjusted EBITDA (unaudited) (in thousands)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2024			2023			2024			2023
Net loss	$	(10,258	)	$	(10,949	)	$	(34,680	)	$	(43,007	)
Interest expense		2,041			2,386			6,506			7,207
Depreciation and amortization		1,492			782			4,324			2,351
Share-based compensation expense		1,515			954			5,373			4,292
Loss on extinguishment of liabilities		—			—			248			—
COVID-19 Revenue		—			—			—			(13	)
COVID-19 Direct costs and expenses		—			—			—			1
Change in fair value of warrant liability, net		—			1,393			—			1,332
Other expense (income), net		(374	)		(2	)		77			(4	)
Adjusted EBITDA	$	(5,584	)	$	(5,436	)	$	(18,152	)	$	(27,841	)

Markets News

Jim Cramer Warns Apple Stock Should Have 'Never Been Up That Much' After Q3 Earnings Even As This Analyst Defends iPhone 16 Launch

01.11.2024 by admin

After Apple Inc.’s AAPL forecast cuts following the company’s fourth-quarter results, “Mad Money” host Jim Cramer cautions that “the stock should never have been up that much,” while Dan Ives defends the company’s strong iPhone 16 launch.

What Happened: On Thursday, Cramer took to X, formerly Twitter, and suggested that Apple’s lowered financial forecast, indicating a slowdown, has now been “absorbed” by the market, which he thinks brings down overhyped expectations to a more “reasonable” level

Okay we are over the big bad forecast cut for Apple. Tomorrow we get price target cuts and maybe a downgrade or two but now expectations are at last reasonable.. Interesting that Europe was strong for BOTH Apple and Amazon

— Jim Cramer (@jimcramer) October 31, 2024

Cramer also implied Apple hasn’t faced as much criticism for spending on AI compared to other tech giants, possibly because investors don’t think Apple’s AI efforts are as significant or game-changing.

“Oh and, tell me, please, who was surprised by the forecast guidedown? The stock should never have been up that much…,” he stated.

Let’s noodle on this. The hyperscalers are all attacked for spending too much. Apple gets a free a.i. ride but it means nothing to the Apple bears…Oh and, tell me, please, who was surprised by the forecast guidedown? The stock should never have been up that much…

— Jim Cramer (@jimcramer) October 31, 2024

Contrarily, Wedbush analyst Ives defended Apple’s fourth-quarter performance. He lauded the successful launch of iPhone 16 and forecasted a robust December quarter for the company, propelled by the rollout of Apple Intelligence.

Ives also conveyed his conviction that the strong performance will persist throughout the rest of the fiscal year 2025, despite a lower guide delta for wearables, Mac, and iPad.

This was a solid q for Apple and the iPhone 16 launch appears be off to a very good start. The rollout of Apple Intelligence will result in a strong Dec q but will also flow into rest of FY25. We believe Dec guide delta is lower wearables/Mac/iPad..iPhone and Services solid🐂🏆🍎

— Dan Ives (@DivesTech) November 1, 2024

Why It Matters: Apple announced fiscal fourth-quarter revenue of $94.9 billion, surpassing analyst predictions of $94.56 billion. The company also reported adjusted earnings of $1.64 per share for the quarter, exceeding expectations of $1.60 per share.

This marks the seventh consecutive quarter that Apple has exceeded analyst forecasts for both revenue and earnings, according to Benzinga Pro.

During the earnings call on Thursday, Apple CEO Tim Cook said that the adoption rate of iOS 18.1 has doubled that of its predecessor, iOS 17.1, indicating a strong demand for the new iPhone 16.

However, previously it was reported that Apple had to resort to aggressive pricing strategies, including discounts on Alibaba’s Tmall, to counter the initial lukewarm response to the iPhone 16 in China.

Price Action: Apple’s stock fell 1.8% on Thursday to close at $225.91, and fell over 1.2% in premarket trading on Friday. Year-to-date, Apple’s shares are up 21.7%, according to Benzinga Pro data.

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Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.

Photo courtesy: Apple

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Boeing Sweetens Deal With 38% Wage Hike, $12K Bonus And More To End 7-Week Strike: Vote Set For Monday

01.11.2024 by admin

Striking employees at Boeing Co. BA are poised to vote on a new contract proposal on Monday. The proposal, which includes a 38% wage increase over four years and a larger signing bonus, has received backing from the workers’ union.

What Happened: The International Association of Machinists and Aerospace Workers (IAM) stated that they have negotiated the best possible terms with Boeing. Previously, union members had turned down two offers from the company.

Reuters reported on Friday that this new offer comes as Boeing attempts to stabilize its finances amid a seven-week strike involving over 33,000 factory workers on the U.S. West Coast. The strike has significantly affected Boeing’s cash flow and halted production of key aircraft models.

Acting U.S. Secretary of Labor Julie Su facilitated recent negotiations, lauding both parties for their efforts. President Joe Biden also praised the union and Boeing for reaching a new contract proposal, highlighting the sacrifices made by Boeing’s machinists.

Boeing’s latest offer includes a $12,000 ratification bonus, integrating previous bonuses into workers’ 401(k) retirement accounts. Despite the improved terms, approval remains uncertain as some workers express dissatisfaction due to the absence of a defined-benefit pension.

Why It Matters: The ongoing strike has already cost Boeing an estimated $2 billion over the last five weeks. The machinists’ rejection of previous offers has added further uncertainty to Boeing’s financial recovery efforts.

In a bid to bolster its finances, Boeing recently expanded its stock offering, aiming for a $20.7 billion windfall. The company priced its public offerings at 112.5 million shares of common stock at $143.00 each.

Price Action: Boeing saw its stock climb higher by 2.77% during the after-hours market after it closed at $149.31 on Thursday, according to Benzinga Pro.

Read Next:

Image via Shutterstock

This story was generated using Benzinga Neuro and edited by Pooja Rajkumari

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RE/MAX HOLDINGS, INC. REPORTS THIRD QUARTER 2024 RESULTS

01.11.2024 by admin

Total Revenue of $78.5 Million, Adjusted EBITDA of $27.3 Million

DENVER, Oct. 31, 2024 /PRNewswire/ —

Third Quarter 2024 Highlights
(Compared to third quarter 2023 unless otherwise noted)

Total Revenue decreased 3.4% to $78.5 million
Revenue excluding the Marketing Funds¹ decreased 3.3% to $58.4 million, driven by negative 3.0% organic growth² and 0.3% adverse foreign currency movements
Net income attributable to RE/MAX Holdings, Inc. of $1.0 million and earnings per diluted share (GAAP EPS) of $0.05
Adjusted EBITDA³ increased 2.0% to $27.3 million, Adjusted EBITDA margin³ of 34.8% and Adjusted earnings per diluted share (Adjusted EPS³) of $0.38
Total agent count increased 174 agents, or 0.1%, to 145,483 agents
U.S. and Canada combined agent count decreased 4.4% to 78,201 agents
Total open Motto Mortgage franchises decreased 3.3% to 234 offices⁴

RE/MAX Holdings, Inc. (the “Company” or “RE/MAX Holdings”) RMAX, parent company of RE/MAX, one of the world’s leading franchisors of real estate brokerage services, and Motto Mortgage (“Motto”), the first and only national mortgage brokerage franchise brand in the U.S., today announced operating results for the quarter ended September 30, 2024.

“We continue to drive operational efficiency across the enterprise, which helped generate better-than-forecasted third-quarter financial results,” said Erik Carlson, RE/MAX Holdings Chief Executive Officer. “Our team is developing new revenue opportunities while working to run our core business better each day. That effort has contributed to our strong margin performance the past two quarters, which is an encouraging trend.”

Carlson continued: “Business optimization, having a growth mindset, and delivering the absolute best customer experience possible are the cornerstones of our playbook. We are making measurable progress on each of these. With increasing optimism about the trajectory of future interest rates, our growing global agent count, and our bold new initiatives – including providing innovative and enhanced technology products to our RE/MAX affiliates, improving the agent-customer experience by cultivating leads, and starting to monetize our digital assets – we are well-positioned to finish the year with positive momentum.”

Third Quarter 2024 Operating Results

Agent Count

The following table compares agent count as of September 30, 2024 and 2023:


	As of September 30,		Change
	2024	2023	#	%
U.S.	52,808	56,494	(3,686)	(6.5)
Canada	25,393	25,288	105	0.4
Subtotal	78,201	81,782	(3,581)	(4.4)
Outside the U.S. & Canada	67,282	63,527	3,755	5.9
Total	145,483	145,309	174	0.1

Revenue

RE/MAX Holdings generated revenue of $78.5 million in the third quarter of 2024, a decrease of $2.7 million, or 3.4%, compared to $81.2 million in the third quarter of 2023. Revenue excluding the Marketing Funds was $58.4 million in the third quarter of 2024, a decrease of $2.0 million, or 3.3%, versus the same period in 2023. The decrease in Revenue excluding the Marketing Funds was attributable to negative organic revenue growth of 3.0% and adverse foreign currency movements of 0.3%. Negative organic revenue growth was principally driven by a decrease in U.S. agent count and a reduction in revenue from previous acquisitions, partially offset by an increase in Broker fee revenue.

Recurring revenue streams, which consist of continuing franchise fees and annual dues, decreased $1.5 million, or 3.8%, compared to the third quarter of 2023 and accounted for 66.4% of Revenue excluding the Marketing Funds in the third quarter of 2024 compared to 66.7% of Revenue excluding the Marketing Funds in the prior-year period.

Operating Expenses

Total operating expenses were $63.3 million for the third quarter of 2024, a decrease of $39.0 million, or 38.1%, compared to $102.2 million in the third quarter of 2023. During the third quarter of 2023, the Company agreed to pay $55.0 million to settle various industry class-action lawsuits, which was recorded in the third quarter of 2023. A $24.9 million gain on reduction in tax receivable agreement liability was also recorded in the third quarter of 2023.

Selling, operating and administrative expenses were $35.9 million in the third quarter of 2024, a decrease of $7.2 million, or 16.6%, compared to the third quarter of 2023 and represented 61.5% of Revenue excluding the Marketing Funds, compared to 71.4% in the prior-year period. Third quarter 2024 selling, operating and administrative expenses decreased primarily due to lower personnel costs and a decrease in bad debt, legal, and other technology expenses.

Net Income (Loss) and GAAP EPS

Net income attributable to RE/MAX Holdings was $1.0 million for the third quarter of 2024 compared to net loss of ($59.5) million for the third quarter of 2023. Reported basic and diluted GAAP earnings per share were $0.05 each for the third quarter of 2024 compared to basic and diluted GAAP loss per share of ($3.28) each in the third quarter of 2023.

Adjusted EBITDA and Adjusted EPS

Adjusted EBITDA was $27.3 million for the third quarter of 2024, an increase of $0.5 million, or 2.0%, compared to the third quarter of 2023. Third quarter 2024 Adjusted EBITDA increased primarily due to a decrease in bad debt, legal, personnel, and other technology expenses, partially offset by a decrease in U.S. agent count. Adjusted EBITDA margin was 34.8% in the third quarter of 2024, compared to 32.9% in the third quarter of 2023.

Adjusted basic and diluted EPS were $0.39 and $0.38, respectively, for the third quarter of 2024 compared to Adjusted basic and diluted EPS of $0.40 each for the third quarter of 2023. The ownership structure used to calculate Adjusted basic and diluted EPS for the quarter ended September 30, 2024, assumes RE/MAX Holdings owned 100% of RMCO, LLC (“RMCO”). The weighted average ownership RE/MAX Holdings had in RMCO was 60.0% for the quarter ended September 30, 2024.

Balance Sheet

As of September 30, 2024, the Company had cash and cash equivalents of $83.8 million, an increase of $1.2 million from December 31, 2023. As of September 30, 2024, the Company had $441.8 million of outstanding debt, net of an unamortized debt discount and issuance costs, compared to $444.6 million as of December 31, 2023.

Share Repurchases and Retirement

As previously disclosed, in January 2022 the Company’s Board of Directors authorized a common stock repurchase program of up to $100 million. During the three months ended September 30, 2024, the Company did not repurchase any shares. As of September 30, 2024, $62.5 million remained available under the share repurchase program.

Impact of Hurricanes Helene and Milton

Several of the Company’s affiliates were impacted by the recent hurricanes. While the extent of the hurricanes’ full impact on the Company’s networks is not entirely known at this time, the Company currently estimates that its fourth quarter revenue will be lower than previously expected as financial support is provided to affected affiliates for a limited time. As a result, the Company’s fourth quarter and full year revenue (below) was reduced by approximately $1.0 million to $1.5 million, of which approximately 40% relates to the Marketing Funds, to reflect expected foregone revenue in the form of fee waivers provided to affiliates impacted by these storms.

Outlook

The Company’s fourth quarter and full year 2024 Outlook includes the impact of the fee waivers to hurricane-impacted affiliates and assumes no further currency movements, acquisitions, or divestitures.

For the fourth quarter of 2024, RE/MAX Holdings expects:

Agent count to change 0.0% to 1.0% over fourth quarter 2023;
Revenue in a range of $71.0 million to $76.0 million (including revenue from the Marketing Funds in a range of $18.5 million to $20.5 million); and
Adjusted EBITDA in a range of $20.5 million to $23.5 million.

For the full year 2024, the Company now expects:

Agent count to change 0.0% to 1.0% over full year 2023, changed from negative 1.0% to positive 1.0%;
Revenue in a range of $306.0 million to $311.0 million (including revenue from the Marketing Funds in a range of $78.5 million to $80.5 million), changed from $305.0 million to $315.0 million (including revenue from the Marketing Funds in a range of $78.0 million to $82.0 million); and
Adjusted EBITDA in a range of $95.0 million to $98.0 million, changed from $93.0 million to $98.0 million.

Webcast and Conference Call

The Company will host a conference call for interested parties on Friday, November 1, 2024, beginning at 8:30 a.m. Eastern Time. Interested parties can register in advance for the conference call using the link below:

https://registrations.events/direct/Q4I941153

Interested parties also can access a live webcast through the Investor Relations section of the Company’s website at http://investors.remaxholdings.com. Please dial-in or join the webcast 10 minutes before the start of the conference call. An archive of the webcast will be available on the Company’s website for a limited time as well.

Basis of Presentation

Unless otherwise noted, the results presented in this press release are consolidated and exclude adjustments attributable to the non-controlling interest.

Footnotes:

¹Revenue excluding the Marketing Funds is a non-GAAP measure of financial performance that differs from U.S. Generally Accepted Accounting Principles (“U.S. GAAP”) and a reconciliation to the most directly comparable U.S. GAAP measure is as follows (in thousands):

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2024		2023		2024		2023
Revenue excluding the Marketing Funds:
Total revenue	$	78,478	$	81,223	$	235,218	$	249,071
Less: Marketing Funds fees		20,098		20,853		60,331		63,272
Revenue excluding the Marketing Funds	$	58,380	$	60,370	$	174,887	$	185,799

²The Company defines organic revenue growth as revenue growth from continuing operations excluding (i) revenue from Marketing Funds, (ii) revenue from acquisitions, and (iii) the impact of foreign currency movements. The Company defines revenue from acquisitions as the revenue generated from the date of an acquisition to its first anniversary (excluding Marketing Funds revenue related to acquisitions where applicable).

³Adjusted EBITDA, Adjusted EBITDA margin and Adjusted EPS are non-GAAP measures. These terms are defined at the end of this release. Please see Tables 5 and 6 appearing later in this release for reconciliations of these non-GAAP measures to the most directly comparable GAAP measures.

⁴Total open Motto Mortgage franchises includes only “bricks and mortar” offices with a unique physical address with rights granted by a full franchise agreement with Motto Franchising, LLC and excludes any “virtual” offices or Branchise^SM offices.

# # #

About RE/MAX Holdings, Inc.

RE/MAX Holdings, Inc. RMAX is one of the world’s leading franchisors in the real estate industry, franchising real estate brokerages globally under the RE/MAX^® brand, and mortgage brokerages within the U.S. under the Motto^® Mortgage brand. RE/MAX was founded in 1973 by Dave and Gail Liniger, with an innovative, entrepreneurial culture affording its agents and franchisees the flexibility to operate their businesses with great independence. Now with more than 140,000 agents in nearly 9,000 offices and a presence in more than 110 countries and territories, nobody in the world sells more real estate than RE/MAX, as measured by total residential transaction sides. Dedicated to innovation and change in the real estate industry, RE/MAX launched Motto Franchising, LLC, a ground-breaking mortgage brokerage franchisor, in 2016. Motto Mortgage, the first and only national mortgage brokerage franchise brand in the U.S., has grown to over 225 offices across more than 40 states.

Forward-Looking Statements

This press release includes “forward-looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements are often identified by the use of words such as “believe,” “intend,” “expect,” “estimate,” “plan,” “outlook,” “project,” “anticipate,” “may,” “will,” “would” and other similar words and expressions that predict or indicate future events or trends that are not statements of historical matters. Forward-looking statements include statements related to agent count; Motto open offices; franchise sales; revenue; operating expenses and cost management; the Company’s outlook for the fourth quarter and full year 2024; non-GAAP financial measures; housing and mortgage market conditions; interest rates; the amount of fee waivers to affiliates affected by recent hurricanes and the impact of such fee waivers on our fourth quarter and full year 2024 outlook; operational efficiencies; business optimization and delivering the absolute best customer experience; development of new revenue opportunities; our strong margin performance being an encouraging trend; increasing optimism about future interest rates; our growing global agent count and our bold new initiatives, including enhanced technology, improved customer experience with leads, and monetizing our digital assets; and being well positioned to finish the year with positive momentum. Forward-looking statements should not be read as a guarantee of future performance or results and will not necessarily accurately indicate the times at which such performance or results may be achieved. Forward-looking statements are based on information available at the time those statements are made and/or management’s good faith belief as of that time with respect to future events and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. These risks and uncertainties include, without limitation, (1) changes in the real estate market or interest rates and availability of financing, (2) changes in business and economic activity in general, (3) the Company’s ability to attract and retain quality franchisees, (4) the Company’s franchisees’ ability to recruit and retain real estate agents and mortgage loan originators, (5) changes in laws and regulations, (6) the Company’s ability to enhance, market, and protect its brands, (7) the Company’s ability to implement its technology initiatives, (8) risks related to the Company’s leadership transition, (9) fluctuations in foreign currency exchange rates, (10) the nature and amount of the exclusion of charges in future periods when determining Adjusted EBITDA is subject to uncertainty and may not be similar to such charges in prior periods, and (11) those risks and uncertainties described in the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q filed with the Securities and Exchange Commission (“SEC”) and similar disclosures in subsequent periodic and current reports filed with the SEC, which are available on the investor relations page of the Company’s website at www.remaxholdings.com and on the SEC website at www.sec.gov. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date on which they are made. Except as required by law, the Company does not intend, and undertakes no obligation, to update this information to reflect future events or circumstances.

TABLE 1
RE/MAX Holdings, Inc.
Consolidated Statements of Income (Loss)
*(In thousands, except share and per share amounts)*
*(Unaudited)*

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2024		2023		2024		2023
Revenue:
Continuing franchise fees	$	30,798	$	31,834	$	92,223	$	96,011
Annual dues		7,969		8,456		24,345		25,661
Broker fees		14,915		14,255		40,159		39,468
Marketing Funds fees		20,098		20,853		60,331		63,272
Franchise sales and other revenue		4,698		5,825		18,160		24,659
Total revenue		78,478		81,223		235,218		249,071
Operating expenses:
Selling, operating and administrative expenses		35,932		43,090		116,488		132,417
Marketing Funds expenses		20,098		20,853		60,331		63,272
Depreciation and amortization		7,237		8,195		22,489		24,236
Settlement and impairment charges		—		55,000		—		55,000
Gain on reduction in tax receivable agreement liability		—		(24,917)		—		(24,917)
Total operating expenses		63,267		102,221		199,308		250,008
Operating income (loss)		15,211		(20,998)		35,910		(937)
Other expenses, net:
Interest expense		(9,249)		(9,292)		(27,696)		(26,377)
Interest income		885		1,173		2,835		3,318
Foreign currency transaction gains (losses)		74		125		(568)		383
Total other expenses, net		(8,290)		(7,994)		(25,429)		(22,676)
Income (loss) before provision for income taxes		6,921		(28,992)		10,481		(23,613)
Provision for income taxes		(3,507)		(53,680)		(6,484)		(56,494)
Net income (loss)	$	3,414	$	(82,672)	$	3,997	$	(80,107)
Less: net income (loss) attributable to non-controlling interest		2,448		(23,218)		2,679		(21,992)
Net income (loss) attributable to RE/MAX Holdings, Inc.	$	966	$	(59,454)	$	1,318	$	(58,115)

Net income (loss) attributable to RE/MAX Holdings, Inc. per share of Class A common stock
Basic	$	0.05	$	(3.28)	$	0.07	$	(3.22)
Diluted	$	0.05	$	(3.28)	$	0.07	$	(3.22)
Weighted average shares of Class A common stock outstanding
Basic		18,863,793		18,150,557		18,733,190		18,064,009
Diluted		19,483,798		18,150,557		19,063,279		18,064,009
Cash dividends declared per share of Class A common stock	$	—	$	0.23	$	—	$	0.69

TABLE 2
RE/MAX Holdings, Inc.
Consolidated Balance Sheets
*(In thousands, except share and per share amounts)*
*(Unaudited)*

	As of
	September 30,		December 31,
	2024		2023
Assets
Current assets:
Cash and cash equivalents	$	83,779	$	82,623
Restricted cash		72,599		43,140
Accounts and notes receivable, current portion, net of allowances		30,598		33,427
Income taxes receivable		1,693		1,706
Other current assets		13,224		15,669
Total current assets		201,893		176,565
Property and equipment, net of accumulated depreciation		8,295		8,633
Operating lease right of use assets		19,209		23,013
Franchise agreements, net		87,346		101,516
Other intangible assets, net		15,297		19,176
Goodwill		240,102		241,164
Other assets, net of current portion		6,507		7,083
Total assets	$	578,649	$	577,150
Liabilities and stockholders’ equity (deficit)
Current liabilities:
Accounts payable	$	5,347	$	4,700
Accrued liabilities		105,132		107,434
Income taxes payable		1,274		766
Deferred revenue		22,625		23,077
Current portion of debt		4,600		4,600
Current portion of payable pursuant to tax receivable agreements		285		822
Operating lease liabilities		8,437		7,920
Total current liabilities		147,700		149,319
Debt, net of current portion		437,176		439,980
Deferred tax liabilities		11,281		10,797
Deferred revenue, net of current portion		15,482		17,607
Operating lease liabilities, net of current portion		25,044		31,479
Other liabilities, net of current portion		3,729		4,029
Total liabilities		640,412		653,211
Commitments and contingencies
Stockholders’ equity (deficit):
Class A common stock, par value $.0001 per share, 180,000,000 shares authorized; 18,872,052 and 18,269,284 shares issued and outstanding as of September 30, 2024 and December 31, 2023, respectively		2		2
Class B common stock, par value $.0001 per share, 1,000 shares authorized; 1 share issued and outstanding as of September 30, 2024 and December 31, 2023, respectively		—		—
Additional paid-in capital		562,594		550,637
Accumulated deficit		(139,524)		(140,217)
Accumulated other comprehensive income (deficit), net of tax		35		638
Total stockholders’ equity attributable to RE/MAX Holdings, Inc.		423,107		411,060
Non-controlling interest		(484,870)		(487,121)
Total stockholders’ equity (deficit)		(61,763)		(76,061)
Total liabilities and stockholders’ equity (deficit)	$	578,649	$	577,150

TABLE 3
RE/MAX Holdings, Inc.
Consolidated Statements of Cash Flows
*(In thousands)*
*(Unaudited)*

	Nine Months Ended
	September 30,
	2024		2023
Cash flows from operating activities:
Net income (loss)	$	3,997	$	(80,107)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization		22,489		24,236
Equity-based compensation expense		14,443		14,050
Bad debt expense		1,039		4,903
Deferred income tax expense (benefit)		434		51,799
Fair value adjustments to contingent consideration		(300)		(379)
Settlement payment, net		—		55,000
Loss (gain) on sale or disposition of assets, net		160		386
Non-cash lease benefit		(2,110)		(2,242)
Non-cash debt charges		646		644
Payment of contingent consideration in excess of acquisition date fair value		(360)		—
Gain on reduction in tax receivable agreement liability		—		(24,917)
Other, net		53		(73)
Changes in operating assets and liabilities		2,376		(23,675)
Net cash provided by operating activities		42,867		19,625
Cash flows from investing activities:
Purchases of property, equipment and capitalization of software		(5,821)		(4,249)
Other		698		679
Net cash used in investing activities		(5,123)		(3,570)
Cash flows from financing activities:
Payments on debt		(3,450)		(3,450)
Distributions paid to non-controlling unitholders		—		(8,667)
Dividends and dividend equivalents paid to Class A common stockholders		(591)		(13,492)
Payments related to tax withholding for share-based compensation		(2,548)		(4,014)
Common shares repurchased		—		(3,408)
Payment of contingent consideration		—		(360)
Other financing		(21)		—
Net cash used in financing activities		(6,610)		(33,391)
Effect of exchange rate changes on cash		(519)		21
Net increase (decrease) in cash, cash equivalents and restricted cash		30,615		(17,315)
Cash, cash equivalents and restricted cash, beginning of period		125,763		138,128
Cash, cash equivalents and restricted cash, end of period	$	156,378	$	120,813

TABLE 4

RE/MAX Holdings, Inc.

Agent Count

(Unaudited)

As of

September 30,

June 30,

March 31,

December 31,

September 30,

June 30,

March 31,

December 31,

September 30,

2024

2023

2022

Agent Count:

U.S.

Company-Owned Regions

46,283

46,780

47,302

48,401

49,576

50,011

50,340

51,491

52,804

Independent Regions

6,525

6,626

6,617

6,730

6,918

6,976

7,110

7,228

7,311

U.S. Total

52,808

53,406

53,919

55,131

56,494

56,987

57,450

58,719

60,115

Canada

Company-Owned Regions

20,515

20,347

20,151

20,270

20,389

20,354

20,172

20,228

20,174

Independent Regions

4,878

4,846

4,885

4,898

4,899

4,864

4,899

4,892

4,844

Canada Total

25,393

25,193

25,036

25,168

25,288

25,218

25,071

25,120

25,018

U.S. and Canada Total

78,201

78,599

78,955

80,299

81,782

82,205

82,521

83,839

85,133

Outside U.S. and Canada

Independent Regions

67,282

64,943

64,332

64,536

63,527

62,305

61,002

60,175

59,167

Outside U.S. and Canada Total

67,282

64,943

64,332

64,536

63,527

62,305

61,002

60,175

59,167

Total

145,483

143,542

143,287

144,835

145,309

144,510

143,523

144,014

144,300

TABLE 5
RE/MAX Holdings, Inc.
Adjusted EBITDA Reconciliation to Net Income (Loss)
*(In thousands, except percentages)*
*(Unaudited)*

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2024			2023			2024			2023
Net income (loss)	$	3,414		$	(82,672)		$	3,997		$	(80,107)
Depreciation and amortization		7,237			8,195			22,489			24,236
Interest expense		9,249			9,292			27,696			26,377
Interest income		(885)			(1,173)			(2,835)			(3,318)
Provision for income taxes		3,507			53,680			6,484			56,494
EBITDA		22,522			(12,678)			57,831			23,682
Settlement charge ⁽¹⁾		—			55,000			—			55,000
Equity-based compensation expense		4,618			4,891			14,443			14,050
Acquisition-related expense⁽²⁾		—			59			—			160
Fair value adjustments to contingent consideration⁽³⁾		(437)			(280)			(300)			(379)
Restructuring charges ⁽⁴⁾		(18)			4,278			(59)			4,245
Gain on reduction in tax receivable agreement liability ⁽⁵⁾		—			(24,917)			—			(24,917)
Other ⁽⁶⁾		605			395			2,444			1,471
Adjusted EBITDA⁽⁷⁾	$	27,290		$	26,748		$	74,359		$	73,312
Adjusted EBITDA Margin⁽⁷⁾		34.8	%		32.9	%		31.6	%		29.4	%


(1)	Represents the settlement of industry class-action lawsuits.
(2)	Acquisition-related expense includes personnel, legal, accounting, advisory and consulting fees incurred in connection with acquisition activities and integration of acquired companies.
(3)	Fair value adjustments to contingent consideration include amounts recognized for changes in the estimated fair value of the contingent consideration liabilities.
(4)	During the third quarter of 2023, the Company announced a reduction in force and reorganization intended to streamline the Company’s operations and yield cost savings over the long term.
(5)	Gain on reduction in tax receivable agreement liability is a result of a valuation allowance on deferred tax assets recorded during the third quarter of 2023.
(6)	Other is primarily made up of employee retention related expenses from the Company’s CEO transition.
(7)	Non-GAAP measure. See the end of this press release for definitions of non-GAAP measures.

TABLE 6
RE/MAX Holdings, Inc.
Adjusted Net Income (Loss) and Adjusted Earnings per Share
*(In thousands, except share and per share amounts)*
*(Unaudited)*

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2024		2023		2024		2023
Net income (loss)	$	3,414	$	(82,672)	$	3,997	$	(80,107)
Amortization of acquired intangible assets		4,672		5,768		15,085		17,299
Provision for income taxes		3,507		53,680		6,484		56,494
Add-backs:
Settlement charge ⁽¹⁾		—		55,000		—		55,000
Equity-based compensation expense		4,618		4,891		14,443		14,050
Acquisition-related expense⁽²⁾		—		59		—		160
Fair value adjustments to contingent consideration⁽³⁾		(437)		(280)		(300)		(379)
Restructuring charges ⁽⁴⁾		(18)		4,278		(59)		4,245
Gain on reduction in tax receivable agreement liability ⁽⁵⁾		—		(24,917)		—		(24,917)
Other ⁽⁶⁾		605		395		2,444		1,471
Adjusted pre-tax net income		16,361		16,202		42,094		43,316
Less: Provision for income taxes at 25% ⁽⁷⁾		(4,091)		(4,051)		(10,524)		(10,829)
Adjusted net income⁽⁸⁾	$	12,270	$	12,151	$	31,570	$	32,487

Total basic pro forma shares outstanding		31,423,393		30,710,157		31,292,790		30,623,609
Total diluted pro forma shares outstanding		32,043,398		30,710,157		31,622,879		30,623,609

Adjusted net income basic earnings per share⁽⁸⁾	$	0.39	$	0.40	$	1.01	$	1.06
Adjusted net income diluted earnings per share⁽⁸⁾	$	0.38	$	0.40	$	1.00	$	1.06


(1)	Represents the settlement of industry class-action lawsuits.
(2)	Acquisition-related expense includes personnel, legal, accounting, advisory and consulting fees incurred in connection with acquisition activities and integration of acquired companies.
(3)	Fair value adjustments to contingent consideration include amounts recognized for changes in the estimated fair value of the contingent consideration liabilities.
(4)	During the third quarter of 2023, the Company announced a reduction in force and reorganization intended to streamline the Company’s operations and yield cost savings over the long term.
(5)	Gain on reduction in tax receivable agreement liability is a result of a valuation allowance on deferred tax assets recorded during the third quarter of 2023.
(6)	Other is primarily made up of employee retention related expenses from the Company’s CEO transition.
(7)	The long-term tax rate assumes the exchange of all outstanding non-controlling interest partnership units for Class A Common Stock that (a) removes the impact of unusual, non-recurring tax matters and (b) does not estimate the residual impacts to foreign taxes of additional step-ups in tax basis from an exchange because that is dependent on stock prices at the time of such exchange and the calculation is impracticable.
(8)	Non-GAAP measure. See the end of this press release for definitions of non-GAAP measures.

TABLE 7
RE/MAX Holdings, Inc.
Pro Forma Shares Outstanding
*(Unaudited)*

	Three Months Ended		Nine Months Ended
	September 30,		September 30,
	2024	2023	2024	2023
Total basic weighted average shares outstanding:
Weighted average shares of Class A common stock outstanding	18,863,793	18,150,557	18,733,190	18,064,009
Remaining equivalent weighted average shares of stock outstanding on a pro forma basis assuming RE/MAX Holdings owned 100% of RMCO	12,559,600	12,559,600	12,559,600	12,559,600
Total basic pro forma weighted average shares outstanding	31,423,393	30,710,157	31,292,790	30,623,609

Total diluted weighted average shares outstanding:
Weighted average shares of Class A common stock outstanding	18,863,793	18,150,557	18,733,190	18,064,009
Remaining equivalent weighted average shares of stock outstanding on a pro forma basis assuming RE/MAX Holdings owned 100% of RMCO	12,559,600	12,559,600	12,559,600	12,559,600
Dilutive effect of unvested restricted stock units⁽¹⁾	620,005	—	330,089	—
Total diluted pro forma weighted average shares outstanding	32,043,398	30,710,157	31,622,879	30,623,609


(1)	In accordance with the treasury stock method.

TABLE 8
RE/MAX Holdings, Inc.
Adjusted Free Cash Flow & Unencumbered Cash
*(Unaudited)*

	Nine Months Ended
	September 30,
	2024		2023
Cash flow from operations	$	42,867	$	19,625
Less: Purchases of property, equipment and capitalization of software		(5,821)		(4,249)
(Increases) decreases in restricted cash of the Marketing Funds⁽¹⁾		(1,959)		12,222
Adjusted free cash flow⁽²⁾		35,087		27,598

Adjusted free cash flow ⁽²⁾		35,087		27,598
Less: Tax/Other non-dividend distributions to RIHI		—		—
Adjusted free cash flow after tax/non-dividend distributions to RIHI⁽²⁾		35,087		27,598

Adjusted free cash flow after tax/non-dividend distributions to RIHI ⁽²⁾		35,087		27,598
Less: Debt principal payments		(3,450)		(3,450)
Unencumbered cash generated⁽²⁾	$	31,637	$	24,148

Summary
Cash flow from operations	$	42,867	$	19,625
Adjusted free cash flow⁽²⁾	$	35,087	$	27,598
Adjusted free cash flow after tax/non-dividend distributions to RIHI ⁽²⁾	$	35,087	$	27,598
Unencumbered cash generated⁽²⁾	$	31,637	$	24,148

Adjusted EBITDA ⁽²⁾	$	74,359	$	73,312
Adjusted free cash flow as % of Adjusted EBITDA⁽²⁾		47.2 %		37.6 %
Adjusted free cash flow less distributions to RIHI as % of Adjusted EBITDA⁽²⁾		47.2 %		37.6 %
Unencumbered cash generated as % of Adjusted EBITDA⁽²⁾		42.5 %		32.9 %


(1)	This line reflects any subsequent changes in the restricted cash balance (which under GAAP reflects as either (a) an increase or decrease in cash flow from operations or (b) an incremental amount of purchases of property and equipment and capitalization of developed software) to remove the impact of changes in restricted cash in determining adjusted free cash flow.
(2)	Non-GAAP measure. See the end of this press release for definitions of non-GAAP measures.

Non-GAAP Financial Measures

The SEC has adopted rules to regulate the use in filings with the SEC and in public disclosures of financial measures that are not in accordance with U.S. GAAP, such as revenue excluding the Marketing Funds, Adjusted EBITDA and the ratios related thereto, Adjusted net income, Adjusted basic and diluted earnings per share (Adjusted EPS) and adjusted free cash flow. These measures are derived based on methodologies other than in accordance with U.S. GAAP.

Revenue excluding the Marketing Funds is calculated directly from our consolidated financial statements as Total revenue less Marketing Funds fees.

The Company defines Adjusted EBITDA as EBITDA (consolidated net income before depreciation and amortization, interest expense, interest income and the provision for income taxes, each of which is presented in the unaudited consolidated financial statements included earlier in this press release), adjusted for the impact of the following items that are either non-cash or that the Company does not consider representative of its ongoing operating performance: loss or gain on sale or disposition of assets and sublease, settlement and impairment charges, equity-based compensation expense, acquisition-related expense, gain on reduction in tax receivable agreement liability, expense or income related to changes in the estimated fair value measurement of contingent consideration, restructuring charges and other non-recurring items. Adjusted EBITDA margin represents Adjusted EBITDA as a percentage of revenue.

Because Adjusted EBITDA and Adjusted EBITDA margin omit certain non-cash items and other non-recurring cash charges or other items, the Company believes that each measure is less susceptible to variances that affect its operating performance resulting from depreciation, amortization and other non-cash and non-recurring cash charges or other items. The Company presents Adjusted EBITDA and the related Adjusted EBITDA margin because the Company believes they are useful as supplemental measures in evaluating the performance of its operating businesses and provides greater transparency into the Company’s results of operations. The Company’s management uses Adjusted EBITDA and Adjusted EBITDA margin as factors in evaluating the performance of the business.

Adjusted EBITDA and Adjusted EBITDA margin have limitations as analytical tools, and you should not consider these measures in isolation or as a substitute for analyzing the Company’s results as reported under U.S. GAAP. Some of these limitations are:

these measures do not reflect changes in, or cash requirements for, the Company’s working capital needs;
these measures do not reflect the Company’s interest expense, or the cash requirements necessary to service interest or principal payments on its debt;
these measures do not reflect the Company’s income tax expense or the cash requirements to pay its taxes;
these measures do not reflect the cash requirements to pay dividends to stockholders of the Company’s Class A common stock and tax and other cash distributions to its non-controlling unitholders;
these measures do not reflect the cash requirements pursuant to the tax receivable agreements;
these measures do not reflect the cash requirements for share repurchases;
these measures do not reflect the cash requirements for the settlement of industry class-action lawsuits and other legal settlements;
although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often require replacement in the future, and these measures do not reflect any cash requirements for such replacements;
although equity-based compensation is a non-cash charge, the issuance of equity-based awards may have a dilutive impact on earnings per share; and
other companies may calculate these measures differently so similarly named measures may not be comparable.

The Company’s Adjusted EBITDA guidance does not include certain charges and costs. The adjustments to EBITDA in future periods are generally expected to be similar to the kinds of charges and costs excluded from Adjusted EBITDA in prior quarters, such as gain or loss on sale or disposition of assets and sublease, settlement and impairment charges, equity-based compensation expense, acquisition-related expense, gains or losses from changes in the tax receivable agreement liability, expense or income related to changes in the fair value measurement of contingent consideration, restructuring charges and other non-recurring items. The exclusion of these charges and costs in future periods will have a significant impact on the Company’s Adjusted EBITDA. The Company is not able to provide a reconciliation of the Company’s non-GAAP financial guidance to the corresponding U.S. GAAP measures without unreasonable effort because of the uncertainty and variability of the nature and amount of these future charges and costs.

Adjusted net income is calculated as Net income attributable to RE/MAX Holdings, assuming the full exchange of all outstanding non-controlling interests for shares of Class A common stock as of the beginning of the period (and the related increase to the provision for income taxes after such exchange), plus primarily non-cash items and other items that management does not consider to be useful in assessing the Company’s operating performance (e.g., amortization of acquired intangible assets, gain on sale or disposition of assets and sub-lease, non-cash impairment charges, acquisition-related expense, restructuring charges and equity-based compensation expense).

Adjusted basic and diluted earnings per share (Adjusted EPS) are calculated as Adjusted net income (as defined above) divided by pro forma (assuming the full exchange of all outstanding non-controlling interests) basic and diluted weighted average shares, as applicable.

When used in conjunction with GAAP financial measures, Adjusted net income and Adjusted EPS are supplemental measures of operating performance that management believes are useful measures to evaluate the Company’s performance relative to the performance of its competitors as well as performance period over period. By assuming the full exchange of all outstanding non-controlling interests, management believes these measures:

facilitate comparisons with other companies that do not have a low effective tax rate driven by a non-controlling interest on a pass-through entity;
facilitate period over period comparisons because they eliminate the effect of changes in Net income attributable to RE/MAX Holdings, Inc. driven by increases in its ownership of RMCO, LLC, which are unrelated to the Company’s operating performance; and
eliminate primarily non-cash and other items that management does not consider to be useful in assessing the Company’s operating performance.

Adjusted free cash flow is calculated as cash flows from operations less capital expenditures and any changes in restricted cash of the Marketing Funds, all as reported under GAAP, and quantifies how much cash a company has to pursue opportunities that enhance shareholder value. The restricted cash of the Marketing Funds is limited in use for the benefit of franchisees and any impact to adjusted free cash flow is removed. The Company believes adjusted free cash flow is useful to investors as a supplemental measure as it calculates the cash flow available for working capital needs, re-investment opportunities, potential Independent Region and strategic acquisitions, dividend payments or other strategic uses of cash.

Adjusted free cash flow after tax and non-dividend distributions to RIHI is calculated as adjusted free cash flow less tax and other non-dividend distributions paid to RIHI (the non-controlling interest holder) to enable RIHI to satisfy its income tax obligations. Similar payments would be made by the Company directly to federal and state taxing authorities as a component of the Company’s consolidated provision for income taxes if a full exchange of non-controlling interests occurred in the future. As a result and given the significance of the Company’s ongoing tax and non-dividend distribution obligations to its non-controlling interest, adjusted free cash flow after tax and non-dividend distributions, when used in conjunction with GAAP financial measures, provides a meaningful view of cash flow available to the Company to pursue opportunities that enhance shareholder value.

Unencumbered cash generated is calculated as adjusted free cash flow after tax and non-dividend distributions to RIHI less quarterly debt principal payments less annual excess cash flow payment on debt, as applicable. Given the significance of the Company’s excess cash flow payment on debt, when applicable, unencumbered cash generated, when used in conjunction with GAAP financial measures, provides a meaningful view of the cash flow available to the Company to pursue opportunities that enhance shareholder value after considering its debt service obligations.

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