Total Net Sales increased 62% to $185
million, the highest fiscal first quarter sales result in company
history
Record Breaking Retail Segment Quarterly Net
Sales of $120 million
Operating Income of $18 million, Operating
Margin of 10%, EBITDA of $20 million
Advances JRNY® platform, including
FitOn partnership.
Nautilus, Inc. (NYSE: NLS) today reported its unaudited
operating results for the fiscal 2022 first quarter ended June 30,
2021.
Fiscal 2022 First Quarter Ended June 30, 2021 Compared to
June 30, 2020
- Net sales were $184.6 million, up 61.7% compared to $114.2
million for the same period last year, and up 74.4%, excluding
sales related to the Octane brand, which was sold in October 2020.
Sales growth was driven primarily by continued demand for connected
fitness bikes and treadmills, like the Bowflex® VeloCore® bike and
Bowflex® T22 Treadmill, and robust sales of SelectTech®
weights.
- Gross profit was $55.5 million, up 17.1% compared to $47.4
million for the same period last year. Gross margins were 30.1%
this year compared to 41.5% for the same period last year. This
margin pressure is the result of current macro events affecting not
just the Company but many others as well. The 11.4 ppt decrease in
gross margins was primarily due to: higher landed product costs
driven by inflationary price increases in commodities and
components, foreign exchange, and elevated transportation costs,
partially offset by sales price increases (-6 ppts), channel mix as
Direct segment sales were 34% versus 44% last year (-3 ppts),
outbound freight (-1 ppt), and a strategic decision to end
production of select SKUs (-1 ppt).
- Operating expenses were $37.6 million, a decrease of $16.9
million, or 30.9%, compared to the same period last year, primarily
due to the $29.0 million loss on disposal group for the same period
last year partially offset by increased selling and marketing
expenses, as the Direct business returned to more normalized levels
of advertising and the company invested in incremental brand
marketing. Total advertising expenses were $11.6 million this year
versus $2.8 million last year. General and administrative expenses
and product development expenses also increased versus last year
primarily driven by investments in JRNY®.
- Operating income was $17.9 million or 9.7% operating margin, a
$25.0 million improvement compared to a loss of $7.1 million for
the same period last year. JRNY® investments were $4.6 million this
year versus $1 million last year and brand marketing was $3.4
million this year versus $0 last year. Excluding these investments,
our Q1 2022 operating margins have been improved by 4 percentage
points.
- Income from continuing operations improved to $14.0 million, or
$0.43 per diluted share, compared to a loss of $5.0 million, or
$0.17 per diluted share, for the same period last year.
- Net income was $13.9 million, or $0.43 per diluted share,
compared to a net loss of $5.1 million, or $0.17 per diluted share,
for the same period last year.
- The effective tax rate was 19.7% this year compared to 32.0%
for the same period last year.
- The following statements exclude the impact of the loss on
disposal group last year1.
- Adjusted operating expenses were $37.6 million or 20.4% of
sales compared to $25.5 million or 22.3% of sales last year.
- Adjusted operating income was $17.9 million compared to last
year’s $21.9 million, driven by lower gross margins , the return to
normalized levels of brand marketing, and North Star
investments.
- Adjusted income from continuing operations was $14.0 million,
or $0.43 per diluted share, compared to $16.8 million, or $0.56 per
diluted share.
- Adjusted EBITDA from continuing operations was $21.0 million
compared to $25.5 million last year.
1 See "Reconciliation of Non-GAAP Financial
Measures" and "Loss on Disposal Group" for more information
JRNY® update
Nautilus Inc. continues to enhance the JRNY® platform, creating
differentiated connected fitness experiences for their members. In
the past quarter, the Company enhanced its content library, adding
200+ trainer-led videos and commissioning additional Explore the
World content. They introduced the JRNY® app for use with its
popular IC4 and C6 bikes further expanding its diverse lineup of
connected products.
Today, Nautilus also announced a strategic partnership with
digital fitness provider, FitOn. Under the agreement, JRNY® members
will have access to hundreds of off-product workouts through the
JRNY® digital fitness platform and app to keep members engaged and
reaching their fitness goals.
Management Comments
“I’m really pleased by how our team delivered in comparison to
last year, the first full quarter that benefitted from the
COVID-related tailwinds. We delivered the highest fiscal Q1 net
sales in company history, highlighting the continued demand for
at-home fitness products. Retail grew sales by 91% or 107%
excluding Octane, delivering record net sales of $120 million,
while Direct grew by 26%. We generated $18 million in operating
income and 10% operating margins even with the continued external
pressure of elevated logistics costs and supply inflation.
Importantly, we made great progress on our North Star strategy,
with improved incremental brand advertising and further
enhancements to our JRNY® digital fitness platform,” said Jim Barr,
Nautilus Inc. Chief Executive Officer.
“We have generated record results for three sequential quarters,
underscoring the momentum of our execution of North Star, our
long-term transformation plan. We believe that our planned North
Star investments, particularly in marketing and our JRNY® platform,
will result in more predictable growth and consistent and expanding
profitability. We will continue to enhance JRNY® to provide our
members with a differentiated experience and our recently announced
FitOn partnership is an example of that commitment. Our team’s
focus on executing North Star has enabled us to reach more of our
target customers, grow our member base, add new retailer partners,
reduce backlog, and improve our inventory position. These areas of
focus combined with our improving connected fitness experience have
us very well positioned to deliver sustainable long-term growth and
profitability,” continued Mr. Barr.
Fiscal 2022 First Quarter ended June 30, 2021 Segment Results
Compared to June 30, 2020
Direct Segment
- Direct segment sales were $63.4 million, up 25.7% compared to
the same period last year.
- Strength product sales grew 559.4% to a historical record, led
by the popular SelectTech® weights and Bowflex® Home Gyms. Cardio
sales declined 31.1%, primarily due to end-of-life products that
are no longer available for sale this year and a decline in sales
of the Schwinn® IC4 and Bowflex® C6 bikes that was partially offset
by VeloCore® sales.
- As of June 30, 2021, the Direct's segment's backlog totaled
$3.1 million compared to $26.5 million as of March 31, 2021. These
amounts represent unfulfilled consumer orders net of current
promotional programs and sales discounts.
- Direct’s sales results, excluding backlog, were more in line
with typical seasonality, with the quarters ending June and ending
September representing the lower sales volume quarters.
- Gross margins were 38.7% versus 54.6% last year. The 15.9 ppt
decrease in gross margin was primarily driven by: higher landed
product costs (-6 ppts), higher outbound freight costs (-6 ppts),
deleveraging of fixed costs as direct sales grew slower than
retail’s (-2 ppts), a strategic decision to end production of
select SKUs (-1 ppt), and increased investments in JRNY® (-1 ppt).
Gross profit was $24.5 million, down 10.9% versus last year.
- Segment contribution income was $6.8 million or 10.7% of sales,
compared to $17.0 million or 33.7% of sales last year. The decline
was primarily driven by lower gross profit and the return to
normalized advertising expenditures. Advertising expenses were $8.0
million compared to $2.4 million last year.
Retail Segment
- Retail segment sales were $120.5 million, the best quarterly
sales in segment history.
- Net sales were up 91.4% from the same period last year, or
120.7% excluding sales related to the Octane brand. Retail segment
sales outside the United States and Canada grew 70%, or 102%
excluding Octane.
- Strength product sales grew by 119.3%, led by our popular
SelectTech® weights and benches and Bowflex® Home Gyms. Cardio
sales increased by 83.5%, to a historical record, driven by
connected-fitness bikes and treadmills.
- As of June 30, 2021, the Retail segment's backlog totaled
$141.9 million compared to $178.6 million as of March 31, 2021.
These amounts represent customer orders for future shipments and
are net of contractual rebates and consideration payable to
applicable Retail customers.
- Gross margins were 25.1% compared to 30.3% last year. The 5.2
ppt decrease in gross margin was primarily driven by: higher landed
product costs (-6 ppts), a strategic decision to end production of
select SKUs (-1 ppt), offset by leverage on fixed costs as retail
segment sales grew faster than direct segment sales (+2 ppts).
Gross profit was $30.3 million, an increase of 59% versus last
year.
- Segment contribution income was $22.1 million or 18.3% of
sales, compared to $11.6 million or 18.4% of sales for the same
period last year, primarily driven by higher gross profit and
expense leverage.
Balance Sheet and Other Key Highlights as of June 30,
2021:
- Cash and Liquidity:
- Cash, cash equivalents, restricted cash and available-for-sale
securities were $82.8 million, compared to cash, cash equivalents,
restricted cash and available-for-sale securities of $113.2 million
as of March 31, 2021. The decrease was primarily due to the
increase in inventory.
- Debt was $13.4 million compared to $13.3 million as of March
31, 2021.
- $53.6 million was available for borrowing under the Wells Fargo
Asset Based Lending Revolving Facility compared to $54.4 million as
of March 31, 2021.
- Trade receivables were $98.2 million, compared to $88.7 million
as of March 31, 2021. The increase in trade receivables was
primarily due to the timing of customer payments on increased
sales.
- Inventory was $111.1 million, compared to $68.1 million as of
March 31, 2021. The increase in inventory is driven by the
strategic decision to increase on-hand inventory levels ahead of
the fitness season given continued disruption in global logistics.
More than 60% of inventory as of June 30, 2021 was in-transit.
- Trade payables were $114.6 million, compared to $98.9 million
as of March 31, 2021. The increase in trade payables was primarily
due to timing of payments for inventory.
- Capital expenditures totaled $1.9 million during the quarter
ended June 30, 2021.
Forward Looking Guidance
Second Quarter Fiscal 2022
- The Company’s revenue for the next few quarters will be
compared to record results due to the pandemic’s effect on net
sales last year. To gauge continued progress against the expanded
addressable market, the Company will be measuring business versus
last year and versus the same period two years ago for the next few
quarters.
- Demand curves for the Direct segment in Q1 and in the first
month of Q2 have started to revert to more typical seasonality
patterns. Now that Direct’s backlog has returned to more normal
levels, the Company expects Direct sales in Q2 to be lower than
Q1.
- The Company expects total company net sales for the 2nd quarter
of fiscal 2022 to be between $145 million and $155 million, a
2-year revenue CAGR of 53% to 59%.
- Similar to many other companies, the Company expects external
gross margin challenges to continue in Q2 and anticipates increased
price pressure due to the ongoing chip shortage.
- The Company was pleased with the results of North Star
investment in Q1 and plans to continue investing in Q2. Brand
marketing expenditures will be between $5 million and $6 million
versus $3 million last quarter and zero last year. JRNY® investment
will be between $5.5 million and $6.5 million versus $5 million
last quarter and $1 million last year. JRNY® investments will
further enhance platform functionality via improved adaptive
workouts, the addition of a member portal, and additional fresh
content, like the ones provided by their new partner FitOn. The
Company expects these investments to dilute operating margins by 7
to 8 percentage points.
- Given these investments and the external macro pressure on
gross margin, the Company expects operating margins to be in the
low single digits.
Back Half of Fiscal 2022
- The Company expects to continue investing in North Star on a
“pay as we go” basis.
- The Company assumes that the external macro factors negatively
affecting gross margins will continue in Q3 and Q4. Although it’s
unclear when the pressure will ease, the Company expects that over
time, prices will stabilize and eventually return closer to
pre-pandemic levels.
- Until the macro environment improves, the Company expects
operating margins to be in the low to mid-single digits for the
back half of the year.
- The Company continues to expect full year capital expenditures
to be between $12 million and $14 million with the majority
earmarked for JRNY® investments.
- The Company reiterates their expectation of reaching 250,000
JRNY® members by the end of FY22
Longer term view, beyond Fiscal 2022
- The Company’s conviction in their North Star strategy has never
been stronger. Growth in JRNY® members and their increased
engagement confirm the Company’s expectations that their North Star
investments will ultimately yield higher quality recurring revenue
and long-term profitable growth.
- The Company believes the near-term external gross margin
pressures are temporary and are not delaying the Company’s
expectations of achieving sustainable operating margins upwards of
15% by FYE 2026, as they realize the long-term benefits of their
transformational investments.
Conference Call
Nautilus will discuss our fiscal 2022 first quarter ended June
30, 2021 operating results during a live conference call and
webcast on Monday, August 9, 2021 at 1:30 p.m. Pacific Time. The
conference call can be accessed by calling (877) 425-9470 in North
America. International callers may dial (201) 389-0878. Please note
that there will be presentation slides accompanying the earnings
call. The slides will be displayed live on the webcast and will be
available to download via the webcast player or at
http://www.nautilusinc.com/events. The webcast will be archived
online within two hours after completion of the call and will be
available for six months. Participants from the Company will
include Jim Barr, Chief Executive Officer and Aina Konold, Chief
Financial Officer.
A telephonic playback will be available from 4:30 p.m. PT,
August 9, 2021 through 8:59 p.m. PT, August 30, 2021. Participants
can dial (844) 512-2921 in North America and international
participants can dial (412) 317-6671 to hear the playback. The
passcode for the playback is 13721447.
About Nautilus, Inc.
Nautilus, Inc. (NYSE:NLS) is a global leader in digitally
connected home fitness solutions. The company’s brand family
includes Bowflex®, Nautilus®, Schwinn®, and JRNY®, its digital
fitness platform. With a broad selection of exercise bikes, cardio
equipment, and strength training products, Nautilus, Inc. empowers
healthier living through individualized connected fitness
experiences; and in doing so, envisions building a healthier world,
one person at a time.
Headquartered in Vancouver, Washington, the company’s products
are sold direct to consumer on brand websites and through retail
partners and are available throughout the U.S. and internationally.
Nautilus, Inc. uses the investor relations page of its website
(www.nautilusinc.com/investors) to make information available to
its investors and the market.
Forward-Looking Statements
This press release includes forward-looking statements
(statements which are not historical facts) within the meaning of
the Private Securities Litigation Reform Act of 1995, including:
projected, targeted or forecasted financial, operating results and
capital expenditures, including but not limited to net sales growth
rates, gross margins, operating expenses, operating margins,
anticipated demand for the Company's new and existing products,
statements regarding the Company's prospects, resources or
capabilities; planned investments, strategic initiatives and the
anticipated or targeted results of such initiatives; the effects of
the COVID-19 pandemic on the Company’s business; and planned
operational initiatives and the anticipated cost-saving results of
such initiatives. All of these forward-looking statements are
subject to risks and uncertainties that may change at any time.
Factors that could cause Nautilus, Inc.’s actual expectations to
differ materially from these forward-looking statements also
include: weaker than expected demand for new or existing products;
our ability to timely acquire inventory that meets our quality
control standards from sole source foreign manufacturers at
acceptable costs; risks associated with current and potential
delays, work stoppages, or supply chain disruptions, including
shipping delays due to the severe shortage of shipping containers;
an inability to pass along or otherwise mitigate the impact of raw
material price increases and other cost pressures, including
unfavorable currency exchange rates and increased shipping costs;
experiencing delays and/or greater than anticipated costs in
connection with launch of new products, entry into new markets, or
strategic initiatives; our ability to hire and retain key
management personnel; changes in consumer fitness trends; changes
in the media consumption habits of our target consumers or the
effectiveness of our media advertising; a decline in consumer
spending due to unfavorable economic conditions; risks related to
the impact on our business of the COVID-19 pandemic or similar
public health crises; softness in the retail marketplace;
availability and timing of capital for financing our strategic
initiatives, including being able to raise capital on favorable
terms or at all; changes in the financial markets, including
changes in credit markets and interest rates that affect our
ability to access those markets on favorable terms and the impact
of any future impairment. Additional assumptions, risks and
uncertainties are described in detail in our registration
statements, reports and other filings with the Securities and
Exchange Commission, including the “Risk Factors” set forth in our
Annual Report on Form 10-K, as supplemented by our quarterly
reports on Form 10-Q. Such filings are available on our website or
at www.sec.gov. You are cautioned that such statements are not
guarantees of future performance and that our actual results may
differ materially from those set forth in the forward-looking
statements. We undertake no obligation to publicly update or revise
forward-looking statements to reflect subsequent developments,
events, or circumstances.
RESULTS OF OPERATIONS INFORMATION
The following summary contains information from our consolidated
statements of operations for the three-months ended June 30, 2021
and 2020 (unaudited and in thousands, except per share
amounts):
Three-Months Ended June
30,
2021
2020
Net sales
$
184,593
$
114,188
Cost of sales
129,088
66,792
Gross profit
55,505
47,396
Operating expenses:
Selling and marketing
21,300
12,446
General and administrative
11,523
9,315
Research and development
4,815
3,728
Loss on disposal group
—
29,013
Total operating expenses
37,638
54,502
Operating income (loss)
17,867
(7,106
)
Other expense, net
(413
)
(222
)
Income (loss) from continuing operations
before income taxes
17,454
(7,328
)
Income tax expense (benefit)
3,438
(2,342
)
Income (loss) from continuing
operations
14,016
(4,986
)
Loss from discontinued operations, net of
income taxes
(132
)
(124
)
Net income (loss)
$
13,884
$
(5,110
)
Basic income (loss) per share from
continuing operations
$
0.46
$
(0.17
)
Basic loss per share from discontinued
operations
(0.01
)
—
Basic net income (loss) per share
$
0.45
$
(0.17
)
Diluted income (loss) per share from
continuing operations
$
0.43
$
(0.17
)
Diluted loss per share from discontinued
operations
—
—
Diluted net income (loss) per share
$
0.43
$
(0.17
)
Shares used in per share calculations:
Basic
30,697
29,909
Diluted
32,508
29,909
Select Metrics:
Gross margin
30.1
%
41.5
%
Selling and marketing % of net sales
11.5
%
10.9
%
General and administrative % of net
sales
6.2
%
8.2
%
Research and development % of net
sales
2.6
%
3.3
%
Operating income (loss) % of net sales
9.7
%
(6.2
)%
SEGMENT INFORMATION
The following tables present certain comparative information by
segment and major product lines within each business segment for
the three-months ended June 30, 2021 and 2020 (unaudited and in
thousands):
Three-Months Ended June
30,
Change
2021
2020
$
%
Net sales:
Direct net sales:
Cardio products(1)
$
31,430
$
45,585
$
(14,155
)
(31.1
)%
Strength products(2)
31,966
4,848
27,118
559.4
%
Direct
63,396
50,433
12,963
25.7
%
Retail net sales:
Cardio products(1)
89,924
49,011
40,913
83.5
%
Strength products(2)
30,560
13,937
16,623
119.3
%
Retail
120,484
62,948
57,536
91.4
%
Royalty
713
807
(94
)
(11.6
)%
Consolidated net sales
$
184,593
$
114,188
$
70,405
61.7
%
Gross profit:
Direct
$
24,514
$
27,523
$
(3,009
)
(10.9
)%
Retail
30,278
19,066
11,212
58.8
%
Royalty
713
807
(94
)
(11.6
)%
Consolidated gross profit
$
55,505
$
47,396
$
8,109
17.1
%
Gross margin:
Direct
38.7
%
54.6
%
(1,590
)
basis points
Retail
25.1
%
30.3
%
(520
)
basis points
Contribution:
Direct
$
6,759
$
16,995
$
(10,236
)
(60.2
)%
Retail
22,090
11,613
10,477
90.2
%
Royalty
713
807
(94
)
(11.6
)%
Consolidated contribution
$
29,562
$
29,415
$
147
0.5
%
Reconciliation of consolidated
contribution to income (loss) from continuing operations:
Consolidated contribution
$
29,562
$
29,415
$
147
0.5
%
Amounts not directly related to
segments:
Operating expenses
(11,695
)
(36,521
)
24,826
68.0
%
Other expense, net
(413
)
(222
)
(191
)
(86.0
)%
Income tax (expense) benefit
(3,438
)
2,342
(5,780
)
(246.8
)%
Income (loss) from continuing
operations
$
14,016
$
(4,986
)
$
19,002
381.1
%
(1) Cardio products include:
connected-fitness bikes, the Bowflex® C6, Bowflex® VeloCore®,
Schwinn® IC4, Max Trainer®, connected-fitness treadmills, other
exercise bikes, ellipticals and subscription services.
(2) Strength products include: Bowflex®
Home Gyms, Bowflex® SelectTech® dumbbells, kettlebell and barbell
weights, and accessories.
BALANCE SHEET INFORMATION
The following summary contains information from our consolidated
balance sheets as of June 30, 2021 and March 31, 2021 (unaudited
and in thousands):
As of
June 30,
2021
March 31,
2021
Assets
Cash and cash equivalents
$
25,218
$
38,441
Restricted cash
1,339
1,339
Available-for-sale securities
56,264
73,448
Trade receivables, net of allowances
98,160
88,657
Inventories
111,132
68,085
Prepaids and other current assets
15,650
25,840
Income taxes receivable
9,500
—
Total current assets
317,263
295,810
Property, plant and equipment, net
24,718
24,496
Operating lease right-of-use assets
25,662
19,108
Other intangible assets, net
9,350
9,365
Deferred income tax assets,
non-current
3,068
2,144
Other assets
2,325
3,307
Total assets
$
382,386
$
354,230
Liabilities and Shareholders'
Equity
Trade payables
$
114,602
$
98,878
Accrued liabilities
14,515
19,627
Operating lease liabilities, current
portion
4,706
3,384
Warranty obligations, current portion
8,191
7,243
Income taxes payable, current portion
845
5,709
Debt payable, current portion, net of
unamortized debt issuance costs
3,125
3,000
Total current liabilities
145,984
137,841
Operating lease liabilities,
non-current
23,221
17,875
Warranty obligations, non-current
1,593
1,408
Income taxes payable, non-current
3,805
3,657
Other non-current liabilities
606
607
Debt payable, non-current, net of
unamortized debt issuance costs
10,296
10,297
Shareholders' equity
196,881
182,545
Total liabilities and shareholders'
equity
$
382,386
$
354,230
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
Non-GAAP Presentation
In addition to disclosing its financial results determined in
accordance with GAAP, Nautilus has presented in this release
certain non-GAAP financial measures, which exclude the impact of
certain items (as further described below) and provide supplemental
information regarding operating performance. Nautilus presents
non-GAAP financial measures as a complement to results provided in
accordance with GAAP, and the non-GAAP financial measures should
not be regarded as a substitute for GAAP. By disclosing these
non-GAAP financial measures, management intends to provide
investors with a supplemental comparison of operating results and
trends for the periods presented. Management believes these
measures are also useful to investors as such measures allow
investors to evaluate performance using the same metrics that
management uses to evaluate past performance and prospects for
future performance. Nautilus strongly encourages you to review all
its financial statements and publicly filed reports in their
entirety and to not rely on any single financial measure.
EBITDA from Continuing Operations
Nautilus defines EBITDA from continuing operations as its income
from continuing operations, adjusted to exclude interest expense
(income), income tax expense (benefit) of continuing operations,
and depreciation and amortization expense. Nautilus uses EBITDA
from continuing operations in evaluating its operating results and
for financial and operational decision-making purposes such as
budgeting and establishing operational goals. Nautilus believes
that EBITDA from continuing operations helps identify underlying
trends in its business that could otherwise be masked by the effect
of the items that are excluded from EBITDA from continuing
operations and enhances the overall understanding of the Company’s
past performance and future prospects. Management believes that
EBITDA is frequently used by investors, securities analysts, and
other interested parties in their evaluation of companies, many of
which present EBITDA when reporting their results. Other companies
may calculate EBITDA differently, and it may not be comparable.
Adjusted Results
In addition to disclosing the comparable GAAP results, Nautilus
has presented its operating expenses, operating income, and income
from continuing operations on an adjusted basis. Adjusted operating
expenses excludes the non-cash charges related to the disposal
group held-for-sale of Octane Fitness®. Adjusted operating income
excludes non-cash charges related to the disposal group
held-for-sale of Octane Fitness®. Adjusted income from continuing
operations excludes the loss as well as the associated tax benefit.
We believe that the adjustment of this charge and associated tax
benefit, which are inconsistent in amount and frequency,
supplements the GAAP information with a measure that can be used to
assess the sustainability of our operating performance. In addition
to presenting its EBITDA from continuing operations as described
above, Nautilus has also presented EBITDA from continuing
operations on an adjusted basis, excluding the aforementioned loss
for similar reasons.
Adjusted EBITDA from Continuing Operations
In addition to presenting its EBITDA from continuing operations
as described above, Nautilus has also presented EBITDA from
continuing operations on an adjusted basis, to exclude the non-cash
charge related to stock-based compensation expense. We believe that
the adjustment of this charge, which is inconsistent in amount and
frequency, supplements the EBITDA information with a measure that
can be used to assess the sustainability of our operating
performance.
The following table presents a reconciliation of operating
expenses, the most directly comparable GAAP measure, to Adjusted
operating expenses for the three-months ended June 30, 2021 and
2020 (unaudited and in thousands):
Three-Months Ended June
30,
2021
2020
Operating expenses
$
37,638
$
54,502
Loss on disposal group(1)
—
(29,013
)
Adjusted operating expenses
$
37,638
$
25,489
The following table presents a reconciliation of operating
income (loss), the most directly comparable GAAP measure, to
Adjusted operating income for the three-months ended June 30, 2021
and 2020 (unaudited and in thousands):
Three-Months Ended June
30,
2021
2020
Operating income (loss)
$
17,867
$
(7,106
)
Loss on disposal group(1)
—
29,013
Adjusted operating income
$
17,867
$
21,907
The following table presents a reconciliation of income (loss)
from continuing operations, the most directly comparable GAAP
measure, to Adjusted income from continuing operations for the
three-months ended June 30, 2021 and 2020 (unaudited and in
thousands):
Three-Months Ended June
30,
2021
2020
Income (loss) from continuing
operations
$
14,016
$
(4,986
)
Loss on disposal group(1)
—
29,013
Income tax benefit for loss on disposal
group
—
(7,216
)
Adjusted income from continuing
operations
$
14,016
$
16,811
The following table presents a reconciliation of income (loss)
from continuing operations, the most directly comparable GAAP
measure, to EBITDA from continuing operations for the three-months
ended June 30, 2021 and 2020 (unaudited and in thousands):
Three-Months Ended June
30,
2021
2020
Income (loss) from continuing
operations
$
14,016
$
(4,986
)
Interest expense, net
293
337
Income tax expense (benefit) from
continuing operations
3,438
(2,342
)
Depreciation and amortization
2,054
2,646
Earnings (loss) before interest, taxes,
depreciation, and amortization (EBITDA) from continuing
operations
$
19,801
$
(4,345
)
The following table presents a reconciliation of income (loss)
from continuing operations, the most directly comparable GAAP
measure, to Adjusted EBITDA from continuing operations for the
three-months ended June 30, 2021 and 2020 (unaudited and in
thousands):
Three-Months Ended June
30,
2021
2020
Income (loss) from continuing
operations
$
14,016
$
(4,986
)
Interest expense, net
293
337
Income tax expense (benefit) from
continuing operations
3,438
(2,342
)
Depreciation and amortization
2,054
2,646
Loss on disposal group(1)
—
29,013
Stock-based compensation expense
1,225
865
Adjusted earnings before interest, taxes,
depreciation, and amortization (Adjusted EBITDA) from continuing
operations
$
21,026
$
25,533
The following table presents a reconciliation of diluted income
(loss) per share from continuing operations, the most directly
comparable GAAP measure, to Adjusted diluted income per share from
continuing operations for the three-months ended June 30, 2021 and
2020 (unaudited and in thousands):
Three-Months Ended June
30,
2021
2020
Diluted income (loss) per share from
continuing operations
$
0.43
$
(0.17
)
Loss on disposal group, net of tax(1)
—
0.73
Adjusted diluted income per share from
continuing operations
$
0.43
$
0.56
(1) Loss on disposal group
In accordance with Accounting Standards Codification (“ASC”)
360, Property, Plant and Equipment, for a long-lived assets or
disposal group classified as held-for-sale, a loss is recognized
for the carrying amount that exceeds the fair market value of the
long-lived assets less the cost to sell. The assets and liabilities
of a disposal group classified as held-for-sale should be presented
separately in the asset and liability sections, respectively, of
the balance sheet. The disposal group was structured as a sale of
the subsidiary shares and we elected to classify the deferred taxes
associated with the individual assets and liabilities as part of
the disposal group held-for-sale.
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version on businesswire.com: https://www.businesswire.com/news/home/20210809005703/en/
Investor Relations: John Mills ICR, LLC 646-277-1254
john.mills@ICRinc.com
Media: John Fread Nautilus, Inc 360-859-5815
jfread@nautilus.com
Carey Kerns The Hoffman Agency 503-754-7975
ckerns@hoffmn.com
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