Cision Divests Its E-Mail Marketing Assets;
Cision Pre-Releases Select Preliminary Unaudited Fourth
Quarter and Full Year 2018 Results; Provides Initial Full Year 2019
Outlook;
- TrendKite extends Cision's leadership in communications
measurement and attribution
- Divestiture of its e-mail marketing assets and acquisition of
TrendKite increases Cision's organic revenue growth
CHICAGO, Jan. 23, 2019 /PRNewswire/ -- Cision Ltd.
(NYSE: CISN), a leading global provider of software and services to
public relations and marketing communications professionals, today
reported that it has acquired TrendKite, completed the sale of its
email marketing assets, provided select preliminary unaudited
financial results for the fourth quarter and year ended
December 31, 2018, and provided its
initial full year 2019 outlook.
TrendKite Acquisition
Kevin Akeroyd, Cision's Chief
Executive Officer, said the TrendKite acquisition represents an
exciting opportunity to acquire a fast-growing SaaS business with
highly complementary capabilities. "The addition of TrendKite's
award-winning application platform, known for its innovation and
dynamic user experience, gives our customers additional ways to
demonstrate and measure the business impact of their earned media
communications."
"TrendKite and Cision have a shared understanding of the
communications industry's need to quantify the business value of
earned media campaigns," said Erik
Huddleston, former TrendKite CEO and new Cision President.
"The combination of TrendKite's rich analytics platform and the
Cision Communications Cloud platform will powerfully impact our
joint customer base with the most robust, end-to-end Earned Media
Management solution available."
Cision acquired TrendKite for a purchase price of $225 million. The transaction consideration
consisted of approximately $94
million in cash and approximately 10.2 million shares of
Cision, which will be issued subject to the receipt of approval
from the New York Stock Exchange.
Divestiture of E-Mail Marketing Assets
On January 22, 2019 Cision sold
its e-mail marketing assets to a strategic buyer. The sale of the
assets resulted from a detailed review of Cision's long-term
business strategy and desire to focus on our industry-leading
communications cloud platform.
Cision divested the assets for approximately
$49 million of cash consideration,
with the potential for additional cash consideration based upon
meeting certain business performance measures over the next 12
months.
Preliminary Unaudited Fourth Quarter 2018 Financial
Results
|
Prior
Guidance
|
|
Preliminary
Results
|
Revenue
|
$180 -
$184
|
|
$186 -
$187
|
Revenue, excluding
the impact from Purchase Accounting
|
$180 -
$184
|
|
$186 -
$187
|
Net
income (loss)
|
$1 - $5
|
|
($11) -
($6)
|
Net income (loss) per share
|
$0.01 –
$0.04
|
|
($0.08) -
($0.05)
|
Adjusted
EBITDA
|
$63 - $66
|
|
$67 - $68
|
Adjusted net
income
|
$27 - $30
|
|
$30 - $31
|
Adjusted net income
per diluted share
|
$0.21 -
$0.23
|
|
$0.23 -
$0.24
|
Pro forma
fully-diluted weighted average shares outstanding
|
132.7
|
|
132.7
|
Full Year 2018 Preliminary Unaudited Financial
Results
|
Prior
Guidance
|
Preliminary
Results
|
Revenue
|
$724 -
$728
|
|
$730 -
$731
|
Revenue, excluding
the impact from Purchase Accounting
|
$725 -
$729
|
|
$731 -
$732
|
Net loss
|
($12) -
($8)
|
|
($23) -
($19)
|
Net loss per
share
|
($0.09) -
($0.06)
|
|
($0.18) -
($0.15)
|
Adjusted
EBITDA
|
$250 -
$253
|
|
$254 -
$255
|
Adjusted net
income
|
$106 -
$109
|
|
$110 -
$111
|
Adjusted net income
per diluted share
|
$0.83 -
$0.85
|
|
$0.85 -
$0.86
|
Pro forma
fully-diluted weighted average shares outstanding
|
128.8
|
|
128.8
|
"We are pleased to have delivered strong preliminary results for
the fourth quarter," said Kevin
Akeroyd. "We continue to focus our efforts on delivering
best-in-class products and services to our customers, executing on
our remaining synergies, and driving towards our long-term
financial goals and objectives." Cision's pro forma organic revenue
growth for the three months ended December
31, 2018 was approximately 1.6% after adjusting for
non-core revenues and the impact of currency.
The preliminary unaudited financial results shown above for both
the three months and year ended December 31,
2018 include the results of our e-mail marketing assets. As
the acquisitions of Falcon.io and TrendKite were both completed in
2019, the unaudited financial results shown above do not include
the results of either acquisition.
Cision has not yet finalized its financial statement close
process for the quarter ended December 31,
2018, nor has it finalized its assessment of the impact of
the adoption of Accounting Standards Codification Topic 606 ("ASC
606") on a modified retrospective basis, effective December 31, 2018. As a result, the
information in this statement is preliminary and based upon
information available to Cision as of the date of the statement. In
connection with the finalization process and the incorporation of
ASC 606, Cision may identify items that will require adjustments to
its preliminary financial results announced herein. Cision's
financial results could be different, and those differences could
be material.
Full Year 2019 Outlook
Our initial outlook for the
full fiscal year ending December 31,
2019 appears below (all figures in millions, except per
share amounts). These estimates are based on a number of
assumptions that management believes to be reasonable and reflect
the Company's expectations as of the date of this release. Actual
results may differ materially from these estimates as a result of
various factors, and Cision refers you to the cautionary language
regarding "Forward Looking Statements" included in this press
release when considering this information.
|
Outlook
|
Revenue
|
$775 -
$785
|
Revenue, excluding
the impact from Purchase Accounting
|
$782 -
$792
|
Net income
(loss)
|
($5) - $2
|
Net income (loss) per
share
|
($0.03) -
$0.01
|
Adjusted
EBITDA
|
$270 -
$275
|
Adjusted net
income
|
$122 -
$125
|
Adjusted net income
per diluted share
|
$0.82 -
$0.84
|
Pro forma
fully-diluted weighted average shares outstanding
|
149.8
|
The above outlook assumes the inclusion of results from our
acquisitions of Falcon.io and TrendKite from the date of their
respective acquisitions through December 31,
2019, and the inclusion of results from our e-mail marketing
assets from January 1, 2019 through
the date of its divestiture. The above outlook also assumes the
following exchange rates with respect to the British Pound, the
Euro and the Canadian Dollar for fiscal year 2019:
GBP to USD
|
1.27
|
EUR to USD
|
1.14
|
CAD to USD
|
0.75
|
Additionally, our outlook for 2019 excludes any future
acquisitions, divestitures, or other unanticipated events. The
revenue outlook for our full year 2019 outlook represents 4.5%
- 5.0% pro forma organic growth after adjusting for non-core
revenues and the impact of currency. See discussion of
non-GAAP financial measures below in this release.
Conference Call and Webcast
A conference call and webcast with Cision leadership to discuss
the acquisition of TrendKite, the divestiture of the e-mail
marketing assets, select preliminary unaudited financial results
for the fourth quarter and year ended December 31, 2018, and Cision's initial full year
2019 outlook. The call will be conducted Wednesday, January 23, 2019, at 5:00 p.m. Eastern time.
To hear the live event, visit the Cision investor website at
http://investors.cision.com, or dial 1-877-443-4809 (participant
dial in toll free) or 1-412-317-5235 (participant dial in
International). To join the webcast, visit the Cision investor
website at http://investors.cision.com and log on at least 15
minutes prior to the start of the webcast. A replay of the earnings
webcast will be available approximately two hours after the
conclusion of the live event on January
23rd. To access the webcast recording / conference replay,
visit http://investors.cision.com or you can dial 1-877-344-7529
(US), 1-412-317-0088 (International), or 1-855-669-9658
(Canada). The replay access code
for the pre-release earnings call is 10128260. The replay will be
available through January 29th. The
conference call will be simultaneously webcast on the Investor
Relations section of our website:
http://investors.cision.com. Supplemental materials regarding
the transactions will be posted to the Cision website at
http://investors.cision.com approximately one hour in advance of
the conference call and webcast.
Forward-Looking Statements
This communication contains
"forward-looking statements" within the meaning of the safe harbor
provisions of the U.S. Private Securities Litigation Reform Act of
1995, including statements regarding our future financial and
operating performance outlook for the fiscal year ending
December 31, 2019, as well as
information relating to the acquisition of TrendKite and our
divestiture of certain e-mail marketing assets and our realization
of the expected benefits therefrom. In this context,
forward-looking statements often address expected future business
and financial performance and financial condition, and often
contain words such as "anticipate," "intend," "plan," "goal,"
"seek," "aim," "strive," "believe," "see," "project," "predict,"
"estimate," "expect," "continue," "strategy," "future," "likely,"
"may," "might," "should," "will," "would," "target," similar
expressions, and variations or negatives of these words.
Forward-looking statements are neither historical facts nor
assurances of future performance. Instead, they are based only on
our current beliefs, expectations, and assumptions regarding the
future of our business, future plans and strategies, projections,
anticipated events and trends, the economy, and other future
conditions. Because forward-looking statements relate to the
future, they are subject to inherent uncertainties, risks, and
changes in circumstances that are difficult to predict and many of
which are outside of our control. Accordingly, you should not place
undue reliance on these statements, as actual results may vary
materially. A detailed discussion of some of the risks and
uncertainties that could cause our actual results and financial
condition to differ materially from the forward-looking statements
is described under the caption "Risk Factors" in our most recent
quarterly report on Form 10-Q filed on November 8, 2018 and our annual report on Form
10-K filed on March 13, 2018, along
with our other filings with the U.S. Securities and Exchange
Commission. Any forward-looking statement made by us in this
communication is based only on information currently available to
us and speaks only as of the date of this report. We do not assume
any obligation to publicly provide revisions or updates to any
forward-looking statements, whether as a result of new information,
future developments or otherwise, should circumstances change,
except as otherwise required by securities and other applicable
laws. Please consult our public filings at www.sec.gov or
www.Cision.com.
Use of Non-GAAP Financial Measures
Non-GAAP results are presented only as a supplement to our
financial statements based on US generally accepted accounting
principles (GAAP). Non-GAAP financial information is provided to
enhance the reader's understanding of our financial performance,
but none of these non-GAAP financial measures are recognized terms
under GAAP, and non-GAAP measures should not be considered in
isolation or as a substitute for financial measures calculated in
accordance with GAAP. Reconciliations of the most directly
comparable GAAP measures to non-GAAP measures, such as Adjusted
EBITDA, and Adjusted net income per share, are provided within the
schedules attached to this release. We use non-GAAP measures in our
operational and financial decision-making, believing that it is
useful to exclude certain items in order to focus on what we deem
to be a more reliable indicator of ongoing operating performance
and our ability to generate cash flow from operations. As a result,
internal management reports used during monthly operating reviews
include Adjusted EBITDA, and Adjusted net income per share.
Additionally, we believe that the presentation of non-GAAP measures
provides information that is useful to investors as it indicates,
for example, our ability to meet capital expenditures and working
capital requirements and otherwise meet our obligations as they
become due. Investors are cautioned that non-GAAP financial
measures are not a substitute for GAAP disclosures. This
communication also includes certain forward-looking non-GAAP
financial measures. We are unable to present without unreasonable
efforts a reconciliation of forward-looking non-GAAP financial
information to the corresponding GAAP financial information because
management cannot reliably predict all of the necessary
information. Forward-looking non-GAAP financial information is
based on numerous assumptions, including assumptions with respect
to general business, economic, market, regulatory and financial
conditions and various other factors, all of which are difficult to
predict and many of which are beyond our control. Accordingly,
investors are cautioned not to place undue reliance on this
information. Non-GAAP measures are frequently used by securities
analysts, investors, and other interested parties in their
evaluation of companies comparable to Cision, many of which present
non-GAAP measures when reporting their results. These measures can
be useful in evaluating our performance against our peer companies
because we believe the measures provide users with valuable insight
into key components of GAAP financial disclosures. However,
non-GAAP measures have limitations as an analytical tool. Non-GAAP
measures are not necessarily comparable to similarly titled
measures used by other companies. They are not presentations made
in accordance with GAAP, are not measures of financial condition or
liquidity, and should not be considered as an alternative to profit
or loss for the period determined in accordance with GAAP or
operating cash flows determined in accordance with GAAP. As a
result, you should not consider such performance measures in
isolation from, or as a substitute analysis for, results of
operations as determined in accordance with GAAP.
Cision Ltd. and
its Subsidiaries
|
Summary Fourth
Quarter 2018 Preliminary Unaudited Financial Results and Prior
Year
|
Summary Fourth
Quarter 2017 Financial Results
|
(in millions,
except for per share)
|
(Unaudited)
|
|
|
Three Months
Ended
December 31,
2017
|
Three Months
Ended
December 31,
2018
|
Year Ended
December 31,
2017
|
Year Ended
December 31,
2018
|
Revenue
|
$169.0
|
|
$185.9 -
$186.9
|
|
$631.6
|
|
$729.9 -
$730.9
|
|
Revenue, excluding
the impact from Purchase Accounting
|
$169.7
|
|
$185.9 -
$186.9
|
|
$633.1
|
|
$731.4 -
$732.4
|
|
Net loss
|
($34.5)
|
|
($10.5) -
($6.4)
|
|
($123.0)
|
|
($23.3) -
($19.2)
|
|
Net loss per
share
|
($0.28)
|
|
($0.08) -
($0.05)
|
|
($1.63)
|
|
($0.18) -
($0.15)
|
|
Adjusted EBITDA
(2)
|
$61.2
|
|
$67.0 -
$68.0
|
|
$225.5
|
|
$254.1 -
$255.1
|
|
Adjusted net income
(3)
|
$22.9
|
|
$30.8 -
$31.3
|
|
$58.6
|
|
$110.1 -
$110.6
|
|
Adjusted net income
per diluted share (4)
|
$0.19
|
|
$0.23 -
$0.24
|
|
$0.57
|
|
$0.85 -
$0.86
|
|
Pro forma
fully-diluted weighted average shares outstanding
|
121.9
|
|
132.7
|
|
102.0
|
|
128.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cision Ltd. and
its Subsidiaries
|
Reconciliation of
Net Loss to EBITDA and Adjusted EBITDA
|
(in
millions)
|
(Unaudited)
|
|
|
Three Months
Ended
December 31,
2017
|
Three Months
Ended
December 31,
2018
|
Year Ended
December 31,
2017
|
Year Ended
December 31,
2018
|
Net loss
|
($34.5)
|
|
($10.5) -
($6.4)
|
|
($123.0)
|
|
($23.3) -
($19.2)
|
Depreciation and
amortization
|
$36.1
|
|
$33.1 -
$33.6
|
|
$139.5
|
|
$133.2 -
$133.7
|
Interest expense and
loss on extinguishment of debt
|
$20.2
|
|
$25.0 -
$25.2
|
|
$168.3
|
|
$87.3 -
$87.5
|
Provision for
(benefit from) income taxes
|
$17.3
|
|
$2.4 -
$6.4
|
|
($10.6)
|
|
$12.4 -
$16.4
|
EBITDA (1)
|
$39.1
|
|
$54.1 -
$54.7
|
|
$174.2
|
|
$213.7 -
$214.3
|
Acquisition and
offering related costs
|
$16.7
|
|
$12.5 -
$12.7
|
|
$42.2
|
|
$45.1 -
$45.3
|
Stock-based
compensation
|
$1.2
|
|
$1.7 -
$1.9
|
|
$4.1
|
|
$5.4 -
$5.6
|
Deferred revenue
reduction from purchase accounting
|
$0.7
|
|
$0.0 -
$0.0
|
|
$1.5
|
|
$1.5 -
$1.5
|
Gain on sale of
business
|
$0.0
|
|
$0.0 -
$0.0
|
|
($1.8)
|
|
$0.0 -
$0.0
|
Sponsor fees and
expenses
|
$0.0
|
|
$0.0 -
$0.0
|
|
$0.3
|
|
$0.0 -
$0.0
|
Unrealized
translation (gain) loss
|
$3.5
|
|
($1.3) -
($1.3)
|
|
$5.0
|
|
($11.6) -
($11.6)
|
Adjusted EBITDA
(2)
|
$61.2
|
|
$67.0 -
$68.0
|
|
$225.5
|
|
$254.1 -
$255.1
|
|
|
|
|
|
|
|
|
|
Cision Ltd. and
its Subsidiaries
|
Reconciliation of
Net Loss to Adjusted Net Income and Adjusted Net Income per Diluted
Share
|
(in millions,
except for per share)
|
(Unaudited)
|
|
|
Three Months
Ended
December 31,
2017
|
Three Months
Ended
December 31,
2018
|
Year Ended
December 31,
2017
|
Year Ended
December 31,
2018
|
Net loss
|
($34.5)
|
|
($10.5) -
($6.4)
|
|
($123.0)
|
|
($23.3) -
($19.2)
|
|
Provision for
(benefit from) income taxes
|
$17.3
|
|
$2.4 -
$6.4
|
|
($10.6)
|
|
$12.4 -
$16.4
|
|
Acquisition and
offering related costs
|
$16.7
|
|
$12.5 -
$12.7
|
|
$42.2
|
|
$45.1 -
$45.3
|
|
Gain on sale of
business
|
$0.0
|
|
$0.0 -
$0.0
|
|
($1.8)
|
|
$0.0 -
$0.0
|
|
Stock-based
compensation expense
|
$1.2
|
|
$1.7 -
$1.9
|
|
$4.1
|
|
$5.4 -
$5.6
|
|
Deferred revenue
reduction from purchase accounting
|
$0.7
|
|
$0.0 -
$0.0
|
|
$1.5
|
|
$1.5 -
$1.5
|
|
Amortization related
to acquired intangible assets
|
$29.2
|
|
$25.8 -
$26.1
|
|
$113.8
|
|
$103.9 -
$104.2
|
|
Non-recurring
interest and loss on extinguishment of debt
|
$0.0
|
|
$6.9 -
$7.0
|
|
$55.9
|
|
$11.3 -
$11.4
|
|
Sponsor fees and
expenses
|
$0.0
|
|
$0.0 -
$0.0
|
|
$0.3
|
|
$0.0 -
$0.0
|
|
Unrealized
translation (gain) loss
|
$3.5
|
|
($1.3) -
($1.3)
|
|
$5.0
|
|
($11.6) -
($11.6)
|
|
Adjusted Income
before income taxes
|
$34.1
|
|
$41.6 -
$42.3
|
|
$87.4
|
|
$148.8 -
$149.5
|
|
Less: Income tax at a
26% rate for 2018, and a 33% rate for 2017
|
($11.2)
|
|
($11.0) -
($10.8)
|
|
($28.8)
|
|
($38.9) -
($38.7)
|
|
Adjusted net income
(3)
|
$22.9
|
|
$30.8 -
$31.3
|
|
$58.6
|
|
$110.1 -
$110.6
|
|
Pro forma
fully-diluted weighted average shares outstanding
|
121.9
|
|
132.7 -
132.7
|
|
102.0
|
|
128.8 -
128.8
|
|
Adjusted net income
per diluted share (4)
|
$0.19
|
|
$0.23 -
$0.24
|
|
$0.57
|
|
$0.85 -
$0.86
|
|
|
|
(1)
|
Cision defines EBITDA
as net income (loss), plus depreciation and amortization expense,
plus interest expense and loss on extinguishment of debt, plus
provision for (or minus benefit from) income taxes.
|
|
|
(2)
|
Cision defines
Adjusted EBITDA as EBITDA, further adjusted for acquisition and
offering related costs, stock-based compensation, deferred revenue
reduction from purchase accounting, (gains) losses related to
divested businesses or assets, sponsor fees and expenses, and
unrealized translation losses (gains). All of the items included in
the reconciliation from net income to Adjusted EBITDA are either
non-cash items or are items that we consider to be less useful in
assessing our operating performance. In the case of the non-cash
items, we believe that investors can better assess our operating
performance if the measures are presented without such items
because, unlike cash expenses, these adjustments do not affect our
ability to generate free cash flow or invest in our business. For
example, by excluding depreciation and amortization from EBITDA,
users can compare operating performance without regard to different
accounting determinations such as useful life. In the case of the
other items, we believe that investors can better assess operating
performance if the measures are presented without these items
because their financial impact does not reflect ongoing operating
performance.
|
|
|
(3)
|
Cision defines
Adjusted net income as net income (loss) plus provision for (or
minus benefit from) income taxes, further adjusted for acquisition
and offering related costs, (gains) losses related to divested
businesses or assets, stock-based compensation, deferred revenue
reduction from purchase accounting, amortization related to
acquired intangibles, non-recurring interest and losses on
extinguishment of debt, sponsor fees and expenses, and unrealized
translation losses (gains), which together, sum to Adjusted net
income (loss) before income taxes. Adjusted net income (loss)
before income taxes is then taxed at an assumed long term corporate
tax rate of 33% for 2017 and periods prior, and 26% for 2018 and
beyond, pursuant to our preliminary analysis with respect to recent
U.S. tax law changes, to determine Adjusted net income. The
enactment of the Tax Cuts and Jobs Act in December 2017 resulted in
a provisional net one-time tax of $11.9 million in the fourth
quarter of 2017 based on a reasonable estimate of the income tax
effects, primarily from a tax on accumulated foreign earnings, the
remeasurement of deferred tax assets and liabilities and new
limitations on the deductibility of interest. Our calculation of
Adjusted net income excludes this provisional net one-time tax. We
continue to finalize the analysis of the tax reform provisions in
2018. All of the items included in the reconciliation from net
income to Adjusted net income are either non-cash items or are
items that we consider to be less useful in assessing our operating
performance. In the case of the non-cash items, we believe that
investors can better assess our operating performance if the
measures are presented without such items because, unlike cash
expenses, these adjustments do not affect our ability to generate
free cash flow or invest in our business. For example, by excluding
the amortization related to acquired intangibles, users can compare
operating performance without regard to highly variable
amortization expenses related to our acquisitions. In the case of
the other items, we believe that investors can better assess
operating performance if the measures are presented without these
items because their financial impact does not reflect ongoing
operating performance.
|
|
|
(4)
|
Cision defines
Adjusted net income per diluted share as Adjusted net income, as
defined above, divided by the fully-diluted pro forma weighted
average shares outstanding for the period. The fully-diluted pro
forma weighted average shares outstanding for the respective period
assume that the exchange of shares pursuant to our merger with
Capitol Acquisition III had taken effect as of the beginning of
such period. Additionally, for purposes of calculating the number
of fully diluted shares outstanding, we have excluded the potential
impact of dilution from outstanding warrants to purchase shares of
our common stock prior to the dates of their conversion, and stock
options and restricted units issued and outstanding pursuant to our
2017 Omnibus Incentive Plan. During the second quarter of fiscal
2018, we issued an aggregate of 6,342,989 ordinary shares
(6,100,209 ordinary shares on May 18, 2018 and 242,780 ordinary
shares on June 4, 2018), in exchange for all of our outstanding
warrants, pursuant to the completion of our warrant exchange
transactions. During the third quarter of 2018, we issued 2,000,000
ordinary shares for the earn-out achieved during the quarter.
Commencing on these respective issuance dates, we included the
issued shares in our fully-diluted pro forma weighted average share
count.
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About Cision
Cision Ltd. (NYSE: CISN) is a leading global provider of earned
media software and services to public relations and marketing
communications professionals. Cision's software allows users to
identify key influencers, craft and distribute strategic content,
and measure meaningful impact. Cision has over 4,000 employees with
offices in 22 countries throughout the Americas, EMEA, and
APAC. For more information about its award-winning products and
services, including the Cision Communications Cloud®, visit
www.cision.com and follow Cision on Twitter @Cision.
Investor Contact:
Jack
Pearlstein
Chief Financial Officer
Jack.Pearlstein@Cision.com
Media Contact:
Nick
Bell
Vice President, Marketing Communications and Content
nick.bell@cision.com
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SOURCE Cision Ltd.