| |
• |
|
risks related to market volatility in the debt and equity capital markets; |
| |
• |
|
risks related to our published financial guidance; |
| |
• |
|
risks related to our preliminary financial estimates, which represent management’s current estimates and are subject to change; and |
| |
• |
|
the other factors identified in our reports filed or expected to be filed with the SEC, including our Annual Report on Form 10-K for the year ended December 31, 2023 and our Quarterly Reports on Form 10-Q for the quarterly periods ended March 31, 2024 and June 30, 2024. |
You are advised, however, to consult any further disclosures we make on related subjects in our periodic reports on Forms 10-K, 10-Q or 8-K filed with or furnished to the SEC.
Non-GAAP Financial Measures
In this Current Report, in addition to the financial measures prepared in accordance with generally accepted accounting principles (“GAAP”), we present “Adjusted EBITDA,” “Adjusted EBITDA Margin,” “Net Debt,” and “Free Cash Flow.” We consider Adjusted EBITDA, Adjusted EBITDA Margin, Net Debt, and Free Cash Flow as non-GAAP financial measures and important indicators of performance and useful metrics for management and investors to evaluate our business’ ongoing operating performance on a consistent basis across reporting periods. These non-GAAP financial measures, however, have limitations as analytical tools and should not be considered in isolation or as a substitute for performance measures prepared in accordance with GAAP. Estimated Adjusted EBITDA for the three and nine months ended September 30, 2024 represents estimated operating income before depreciation and amortization expenses and excluding other non-recurring adjustments. Adjusted EBITDA Margin is calculated by dividing Adjusted EBITDA by revenue. Net Debt is defined as total debt less debt issuance costs and cash and cash equivalents. Free Cash Flow represents operating cash flow less capital expenditures.
We believe that presenting non-GAAP financial measures aids in making period-to-period comparisons and is a meaningful indication of our actual and estimated operating performance. Our management utilizes and plans to utilize this non-GAAP financial information to compare our operating performance to comparable periods and to internally prepared projections. Our non-GAAP financial measures may not be the same as or comparable to similar non-GAAP measures presented by other companies, which could reduce the usefulness of our non-GAAP financial measures for comparison.
Because our actual operating results remain subject to the completion of our quarter-end closing process, our estimates of Adjusted EBITDA and Adjusted EBITDA Margin are forward-looking non-GAAP financial measures based solely on information available to us as of the date of this release. We are unable to present a quantitative reconciliation of forward-looking Adjusted EBITDA to net income in reliance on the exception provided by Item 10(e)(1)(i)(B) of Regulation S-K because certain information regarding the Company’s provision for income taxes is not available, and management cannot reliably predict all of the necessary components of net income at this time without unreasonable effort or expense. The unavailable information could have a significant impact on the Company’s future financial results. We have provided the reconciliations below based on the information that is currently available to the Company.
Reconciliation of Estimated Operating Income to Estimated Adjusted EBITDA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| In millions |
|
Three Months Ended
September 30, 2024 |
|
|
Nine Months Ended
September 30, 2024 |
|
| Estimated Operating Income |
|
~$ |
22 |
|
|
|
to |
|
|
~$ |
24 |
|
|
~$ |
52 |
|
|
|
to |
|
|
~$ |
54 |
|
| Depreciation and amortization |
|
~$ |
7 |
|
|
|
to |
|
|
~$ |
8 |
|
|
~$ |
20 |
|
|
|
to |
|
|
~$ |
21 |
|
| Other non-recurring adjustments (a) |
|
~$ |
2 |
|
|
|
to |
|
|
~$ |
3 |
|
|
~$ |
23 |
|
|
|
to |
|
|
~$ |
23 |
|
| Estimated Adjusted EBITDA (b) |
|
~$ |
31 |
|
|
|
to |
|
|
~$ |
34 |
|
|
~$ |
95 |
|
|
|
to |
|
|
~$ |
98 |
|
| (a) |
Adjustments for discrete items, including acquisition, integration and restructuring costs, severance and other non-recurring expenses. |
| (b) |
Certain line items presented in the table, when aggregated, may not visually foot due to rounding. |
