Attached files
| file | filename |
|---|---|
| 8-K - Archipelago Learning, Inc. | mm03-0210_8k.htm |
EXHIBIT
99.1
ARCHIPELAGO
LEARNING REPORTS FOURTH QUARTER RESULTS
Revenue
Increased 29% to a Record $12.0 Million
Cash
Flow from Operations Increased 66% to $8.3 Million
DALLAS, Texas – March 2, 2010
– Archipelago Learning, Inc. (NASDAQ: ARCL), a leading subscription-based
online education company, today announced financial results for the fourth
quarter and fiscal year period ended December 31, 2009.
Fourth
Quarter Highlights (4Q09 vs. 4Q08)
|
·
|
Revenue
increased 29% to $12.0 million
|
|
·
|
Cash
flow from operating activities increased 66% to $8.3
million
|
|
·
|
Invoiced
sales (non-GAAP) increased 40% to $14.3
million
|
|
·
|
Adjusted
EBITDA (non-GAAP) increased 51% to $6.9
million
|
|
·
|
Diluted
loss per share from continuing operations was
$0.01
|
|
·
|
Adjusted
diluted EPS (non-GAAP) was $0.11
|
|
·
|
Total
schools at period-end increased 25% year-over-year to approximately
21,700
|
Fiscal
Year Highlights (2009 vs. 2008)
|
·
|
Revenue
increased 36% to $42.8 million
|
|
·
|
Cash
flow from operating activities increased 60% to $21.6
million
|
|
·
|
Deferred
revenue increased 35% to $36.4
million
|
|
·
|
Invoiced
sales (non-GAAP) increased 35% to $53.9
million
|
|
·
|
Adjusted
EBITDA (non-GAAP) increased 40% to $28.4
million
|
|
·
|
Diluted
EPS from continuing operations was
$0.31
|
|
·
|
Adjusted
diluted EPS (non-GAAP) was $0.51
|
|
·
|
Practice
questions answered increased 41% to 3.2
billion
|
Tim
McEwen, chief executive officer, stated, “We are very pleased with our strong
fourth quarter results and momentum heading into the new year. Our record fourth
quarter sales in the face of well recognized budget challenges is a testament to
the affordability and ‘high impact’ efficacy of our products in
helping schools meet ever-increasing performance requirements. Study Island is
fortunate to have a passionate, dedicated staff and educator customer base that
combine talents to engage students of all abilities and help them improve
performance, build a habit of success and develop a joy of
learning. This partnership continues to lead to significant educator
’word-of-mouth‘ referrals. In January we successfully rolled all customers to
the Study Island Version 3.0 web application, which provides new and expanded
tools for assessment, instruction, parent communication, collaboration and
planning. We also continued to deepen our innovative product offering
with the release of new programs, such as Study Island
Canada
and SAT for high schools, which offers students and schools a new flexible and
affordable option for SAT preparation.”
McEwen
concluded, “While market conditions are tough, this is an exciting time to be
involved with the K-12 public education sector. With an intensifying focus on
improving student performance and holding stakeholders accountable, we believe
our high-impact low-cost proven solutions are well positioned for this
market.”
Archipelago
Learning delivered the following results for the fourth quarter and full year
2009:
Revenue: Q4 revenue
increased 29% year-over-year to $12.0 million and invoiced sales increased 40%
year-over-year to $14.3 million. Revenue and invoiced sales were
driven by continued strong execution of the company’s sales force. In
particular, we successfully targeted districts and schools receiving newly
available stimulus funds to secure customary new and renewal
business. In addition, some customers took advantage of these
one-time stimulus funds available in late 2009 to lock-in multi-year
contracts.
For the
full year 2009, revenue increased 36% year-over-year to $42.8 million and
invoiced sales increased 35% year-over-year to $53.9 million.
Cash Flow from Operating
Activities: Q4 cash flow from operating activities increased
66% year-over-year to $8.3 million as a result of the company’s continued strong
operating performance. For the full year, cash flow from operating activities
increased 60% year-over-year to $21.6 million. Excluding cash flow from
operating activities generated by TeacherWeb, which was divested in November
2009, full year cash flow from operating activities would have increased 70%
year-over-year to $20.7 million.
Deferred
Revenue: Deferred revenue on our balance sheet as of December
31, 2009 was $36.4 million, an increase of 35% year-over-year. The
increase in deferred revenue was the result of strong invoiced sales
growth.
Income from Continuing
Operations: Q4 income from continuing operations increased 22%
year-over-year to $3.2 million. Income from continuing operations benefited from
increased revenue partially offset by planned staffing increases across
departments (including the addition of Chief Operating Officer and Chief
Marketing Officer positions), planned increases in content development cost
associated with Version 3.0 and Study Island SAT, higher cash commissions (which
are expensed as incurred) resulting from increased invoiced sales, increased
depreciation expenses associated with our increased capital expenditures and
greater stock-based compensation expense related to options issued in connection
with the company’s November IPO.
For the
full year 2009, income from continuing operations increased 53% year-over-year
to $12.6 million.
Adjusted EBITDA: Q4
adjusted EBITDA increased 51% year-over-year to $6.9 million, which was 48% of
invoiced sales as compared to 45% of invoiced sales in Q4
2008. Growth in adjusted EBITDA was the result of our invoiced sales
growth
and operating leverage in the company’s software-as-a-service model partially
offset by planned staffing increases and planned increases in content
development cost to support growth as well as higher commission
expense.
For the
full year 2009, adjusted EBITDA increased 40% year-over-year to $28.4 million,
which was 53% of invoiced sales as compared to 51% of invoiced sales in fiscal
2008.
Net Income from Continuing
Operations: Q4 net income from continuing operations decreased
to a loss of $0.2 million from a gain of $0.2 million in the prior year period.
Net income from operations was impacted by increased income from operations,
reduced net interest expense and a gain in the fair value of the company’s
interest rate derivative, offset by a one-time non-cash tax charge as well as
higher ordinary income taxes related to the company’s conversion to a
C-corporation in connection with the November IPO. Excluding
stock-based compensation and certain non-recurring items, Q4 adjusted net income
increased 32% year-over-year to $2.4 million.
For the
full year 2009, net income from continuing operations increased to $6.4 million
from $1.1 million in fiscal 2008. Adjusted net income increased 149%
year-over-year to $10.3 million.
Earnings per Share from Continuing
Operations: Q4 diluted EPS from continuing operations was a
loss of $0.01 and Q4 adjusted diluted EPS was $0.11. There were 21.8
million weighted-average diluted shares outstanding for the
quarter.
For the
full year 2009, diluted EPS from continuing operations was $0.31 and adjusted
diluted EPS was $0.51. There were 20.4 million weighted-average
diluted shares outstanding for the year.
Other Balance Sheet
Highlights: At December 31, 2009, cash and cash equivalents
totaled $58.2 million as compared to $13.1 million at the end of the prior
year. Total debt outstanding was $61.6 million following the
repayment of $6.5 million upon the consummation of the TeacherWeb
sale. The market value of the company’s interest rate swap was $(1.1)
million and the company had 25,110,255 shares of common stock outstanding at
year-end.
Fiscal
2010 Outlook
As of
March 2, 2010, Archipelago Learning is initiating guidance for its full fiscal
year 2010 as follows:
|
·
|
Revenue
of $56 to $59 million
|
|
·
|
Adjusted
diluted EPS of $0.44 to $0.48
|
|
·
|
Cash
flow from operations of $23 to $25
million
|
|
·
|
Capital
expenditures of approximately $2
million
|
|
·
|
Total
schools of 24,000 to 25,000
|
TeacherWeb
Divestiture
TeacherWeb
was divested in November 2009 and has been classified as a discontinued
operation for financial reporting purposes. As a result, the income
statement related metrics discussed herein, such as revenue, invoiced sales,
income from continuing operations, adjusted EBITDA, and net income and earnings
per share from continuing operations exclude TeacherWeb in all periods.
Cash flow and balance sheet related results discussed herein include TeacherWeb
except where specifically noted.
Non-GAAP
Financial Measures
This
press release contains four non-GAAP financial measures: invoiced sales,
adjusted EBITDA, adjusted net income and adjusted diluted
EPS. Because these financial measures are not recognized under GAAP,
they should not be used as indicators of, or alternatives to, the corresponding
GAAP financial measures of operating performance.
Invoiced
sales are recognized in the period in which a customer places a purchase order
and an invoice is issued, which may be at a different time than the commencement
of the subscription. Under GAAP, revenue for invoiced sales is
deferred and recognized ratably over the subscription term beginning on the
commencement date of the applicable subscription. This difference
between non-GAAP invoiced sales and GAAP revenue in a given period is equal to
the change in the company’s deferred revenue balance over that
period.
Adjusted
EBITDA, adjusted net income and adjusted diluted EPS differ from the
corresponding GAAP measures in that they exclude stock-based compensation
expense, a one-time non-cash tax charge related to the company’s IPO and
conversion to a C-corporation, gains or losses on the company’s interest rate
swap and other one-time items. Reconciliation tables of GAAP to
non-GAAP financial measures are included at the end of this
release.
Management
believes that these non-GAAP measures provide useful information to investors
regarding certain financial and business trends relating to the company’s
financial condition and results of operations. Although management
uses these non-GAAP financial measures to assess the operating performance of
our business, they have significant limitations as an analytical tool because
they may exclude certain material costs. For example, because
adjusted EBITDA, adjusted net income and adjusted diluted EPS do not account for
certain expenses, their utility as a measure of operating performance has
material limitations. In addition, the definitions of these non-GAAP
financial measures may vary among companies and industries, and they may not be
comparable to other similarly titled measures used by other
companies.
Conference
Call Information
Archipelago
Learning will host a conference call to discuss its fourth quarter fiscal 2009
results and 2010 outlook this afternoon at 4:45 pm Eastern Standard
Time. Investors and analysts interested in participating in the call
are invited to dial (877) 407-0784 approximately ten minutes prior to the start
of the call. A replay of this call will be available starting tonight at 7:45
p.m. EST and will remain active until March 16, 2010. The replay can be accessed
by dialing (877) 660-6853 and entering account number 3055 and conference code
344088. The conference call will be also webcast and can be accessed via the
Investor Relations section of the Company’s website at http://www.archipelagolearning.com.
Please visit the website at least 15 minutes prior to
the call
to register for the webcast and download any necessary software. A replay of the
webcast will be archived on the Company’s website.
Forward
Looking Statements
This
release may contain forward-looking statements within the meaning of Section 27A
of the Securities Act of 1933, as amended, Section 21E of the Securities
Exchange Act of 1934, as amended, and the Private Securities Litigation Reform
Act of 1995. All statements other than statements of historical fact
are considered forward-looking statements and reflect current expectations and
projections relating to our financial condition, results of operations, plans,
objectives, future performance and business. The words
“anticipate,” “estimate,” “expect,” “project,” “forecast,” “plan,” “intend,”
“believe,” “may,” “should,” “likely,” “future,” and other words and terms of
similar meaning are used to identify forward-looking
statements. These forward-looking statements are based on assumptions
that we have made in light of our industry experience and on our perceptions of
historical trends, current conditions, expected future developments and other
factors we believe are appropriate under the circumstances. These
statements are not guarantees of performance or results. They are
subject to risks and uncertainties (some of which are beyond our control), which
could cause actual results to vary materially from the forward-looking
statements contained in this release. Although we believe that these
forward-looking statements are based on reasonable assumptions, many factors
could cause actual results to vary materially from those anticipated in such
forward-looking statements. Certain of these risk factors are
discussed in the Company’s filings with the Securities and Exchange Commission
and include, but are not limited to (i) our customers’ reliance on state, local
and federal funding; (ii) competitive factors, including new competitors more
easily entering our markets if national educational standards are adopted; (iii)
legislation and regulation, including changes in or the repeal of legislation
that mandates state educational standards and annual assessments; (iv)
difficulty in evaluating our current and future business prospects because of
our recent rapid growth; (v) web-based education failing to achieve widespread
acceptance by students, parents, teachers, schools and other institutions; (vi)
lower customer renewal rates or a decrease in sales for our Study Island
products; (v) decisions at district or state levels to use our competitors’
products rather than ours, (vi) seasonal fluctuations, (vii) system or network
disruptions, (viii) delays in product development or product releases, (ix)
acquisition related risks, (x) intellectual property related risks, (xi) our
ability to retain key employees, (xii) risks related to our indebtedness, and
(xiii) risks related to global and U.S. economic conditions.
Any
forward-looking statement speaks only as of the date on which it is made, and
the Company undertakes no obligation to update any forward-looking statements to
reflect new information, future developments or otherwise, except as may be
required by law.
About
Archipelago Learning
Archipelago
Learning is a leading subscription-based online education company that provides
standards-based instruction, practice, assessments and productivity tools that
improve the performance of educators and students via proprietary web-based
platforms. Study Island, the core product line, helps students in kindergarten
through 12th grade master grade-level academic standards in a fun and engaging
manner. Study Island products are utilized by over 9.5 million students in
approximately 21,700 schools in all 50 states, Washington D.C. and Canada. For
more information, please visit www.archipelagolearning.com.
Archipelago Learning is headquartered in Dallas, Texas.
Company
Contacts
|
Investors:
John
Rouleau
Integrated
Corporate Relations
203-682-8342
John.Rouleau@ircinc.com
|
Media:
Leslie
Eicher, APR
Eicher
Communications Inc.
314-965-1776
Leslie@EicherCommunications.com
|
ARCHIPELAGO
LEARNING, INC.
CONSOLIDATED
BALANCE SHEETS - UNAUDITED
|
As of December 31,
|
||||||||
|
2009
|
2008
|
|||||||
|
(In
thousands, except share data)
|
||||||||
|
Assets
|
||||||||
|
Current
assets:
|
||||||||
|
Cash
and cash equivalents
|
$ | 58,248 | $ | 13,144 | ||||
|
Accounts
receivable, net
|
7,535 | 6,093 | ||||||
|
Short-term
deferred tax assets
|
2,528 | 33 | ||||||
|
Prepaid
expenses and other current assets
|
1,809 | 324 | ||||||
|
Total
|
70,120 | 19,594 | ||||||
|
Property
and equipment,
net
|
2,620 | 1,782 | ||||||
|
Goodwill
|
94,373 | 103,267 | ||||||
|
Intangible
assets, net
|
12,327 | 16,106 | ||||||
|
Investment
|
6,446 | — | ||||||
|
Notes
receivable
|
4,931 | — | ||||||
|
Other
long-term assets
|
1,718 | 1,276 | ||||||
|
Total
assets
|
$ | 192,535 | $ | 142,025 | ||||
|
Liabilities
and Equity
|
||||||||
|
Current
liabilities:
|
||||||||
|
Accounts
payable – trade
|
$ | 1,254 | $ | 382 | ||||
|
Accrued
employee-related expenses
|
2,033 | 1,918 | ||||||
|
Other
accrued expenses
|
803 | 128 | ||||||
|
Deferred
revenue
|
31,181 | 24,632 | ||||||
|
Taxes
payable
|
625 | 64 | ||||||
|
Current
portion of long-term debt
|
700 | 700 | ||||||
|
Interest
payable
|
124 | 210 | ||||||
|
Interest
rate swap
|
1,149 | 1,988 | ||||||
|
Total
|
37,869 | 30,022 | ||||||
|
Long-term
debt, net of current
|
60,876 | 68,600 | ||||||
|
Long-term
deferred revenue
|
5,262 | 2,290 | ||||||
|
Long-term
deferred tax liability
|
5,093 | 639 | ||||||
|
Other
long-term liability
|
425 | — | ||||||
|
Total
liabilities
|
109,525 | 101,551 | ||||||
|
Commitments
and contingencies
|
||||||||
|
Members’
Equity:
|
||||||||
|
Class
A shares (no shares authorized, issued or outstanding at December 31,
2009; 109,545,064 shares authorized, issued and outstanding at December
31, 2008)
|
— | 34,792 | ||||||
|
Class
A-2 shares (no shares authorized, issued or outstanding at December 31,
2009; 286,882 shares authorized, issued and outstanding at December 31,
2008)
|
— | 750 | ||||||
|
Class
B shares (no shares authorized, issued or outstanding at December 31,
2009; 6,578,727 shares authorized, 5,355,440 shares issued and outstanding
at December 31, 2008)
|
— | 684 | ||||||
|
Class
C shares (no shares authorized, issued or outstanding at December 31,
2009; 7,126,451 shares authorized, 5,903,164 shares issued and outstanding
at December 31, 2008)
|
— | 302 | ||||||
|
Retained
earnings
|
— | 3,946 | ||||||
|
Total
members’ equity
|
— | 40,474 | ||||||
|
Stockholders’
Equity:
|
||||||||
|
Preferred
stock ($0.001 par value, 100,000,000 shares authorized, none issued and
outstanding at December 31, 2009 and 2008)
|
— | — | ||||||
|
Common
stock ($0.001 par value, 200,000,000 shares authorized,
25,110,255 shares issued and outstanding at December 31, 2009 and no
shares authorized, issued or outstanding at
December 31, 2008)
|
25 | — | ||||||
|
Additional
paid-in capital
|
76,072 | — | ||||||
|
Retained
earnings
|
6,913 | — | ||||||
|
Total
stockholders’ equity
|
83,010 | — | ||||||
|
Total
liabilities and equity
|
$ | 192,535 | $ | 142,025 | ||||
ARCHIPELAGO
LEARNING, INC.
CONSOLIDATED
STATEMENTS OF INCOME - UNAUDITED
|
Quarters Ended December 31,
|
Years Ended December 31,
|
|||||||||||||||
|
|
2009
|
2008
|
2009
|
2008
|
||||||||||||
|
(In
thousands, except share and per share data)
|
||||||||||||||||
|
Revenue
|
$ | 11,967 | $ | 9,274 | $ | 42,768 | $ | 31,415 | ||||||||
|
Cost
of revenue
|
888 | 784 | 3,074 | 1,891 | ||||||||||||
|
Gross
profit
|
11,079 | 8,490 | 39,694 | 29,524 | ||||||||||||
|
Operating
Expense:
|
||||||||||||||||
|
Sales
and marketing
|
4,366 | 3,376 | 14,048 | 12,726 | ||||||||||||
|
Content
development
|
1,187 | 666 | 3,773 | 2,162 | ||||||||||||
|
General
and administrative
|
2,352 | 1,839 | 9,243 | 6,406 | ||||||||||||
|
Total
|
7,905 | 5,881 | 27,064 | 21,294 | ||||||||||||
|
Income
from continuing operations
|
3,174 | 2,609 | 12,630 | 8,230 | ||||||||||||
|
Other
income (expense):
|
||||||||||||||||
|
Interest
expense
|
(733 | ) | (1,188 | ) | (2,803 | ) | (5,161 | ) | ||||||||
|
Interest
income
|
115 | 53 | 159 | 247 | ||||||||||||
|
Derivative
loss
|
(82 | ) | (1,262 | ) | (518 | ) | (2,119 | ) | ||||||||
|
Total
|
(700 | ) | (2,397 | ) | (3,162 | ) | (7,033 | ) | ||||||||
|
Net
income from continuing operations before tax
|
2,474 | 212 | 9,468 | 1,197 | ||||||||||||
|
Provision
for income tax
|
2,645 | 20 | 3,094 | 83 | ||||||||||||
|
Net
(loss) income from continuing operations
|
(171 | ) | 192 | 6,374 | 1,114 | |||||||||||
|
Income
(loss) from discontinued operation before tax
|
31 | (140 | ) | 261 | (339 | ) | ||||||||||
|
Benefit
from income tax on discontinued operation
|
— | (173 | ) | (101 | ) | (247 | ) | |||||||||
|
Net
income (loss) from discontinued operation
|
31 | 33 | 362 | (92 | ) | |||||||||||
|
Net
(loss) income
|
$ | (140 | ) | $ | 225 | $ | 6,736 | $ | 1,022 | |||||||
|
Earnings
(loss) per share:
|
||||||||||||||||
|
Basic:
|
||||||||||||||||
|
Continuing
operations
|
$ | (0.01 | ) | $ | 0.01 | $ | 0.31 | $ | 0.06 | |||||||
|
Discontinued
operation
|
— | — | 0.02 | (0.01 | ) | |||||||||||
|
Total
|
$ | (0.01 | ) | $ | 0.01 | $ | 0.33 | $ | 0.05 | |||||||
|
Diluted:
|
||||||||||||||||
|
Continuing
operations
|
$ | (0.01 | ) | $ | 0.01 | $ | 0.31 | $ | 0.06 | |||||||
|
Discontinued
operation
|
— | — | 0.02 | (0.01 | ) | |||||||||||
|
Total
|
$ | (0.01 | ) | $ | 0.01 | $ | 0.33 | $ | 0.05 | |||||||
|
Weighted-average
shares outstanding:
|
||||||||||||||||
|
Basic
|
21,718,734 | 19,965,866 | 20,407,685 | 19,965,866 | ||||||||||||
|
Diluted
|
21,825,066 | 19,965,866 | 20,434,486 | 19,965,866 | ||||||||||||
ARCHIPELAGO
LEARNING, INC.
CONSOLIDATED
STATEMENTS OF CASH FLOWS - UNAUDITED
|
|
Years Ended December 31,
|
|||||||
|
|
2009
|
2008
|
||||||
|
(In
thousands)
|
||||||||
|
Cash
flows from operating activities
|
||||||||
|
Net
income
|
$ | 6,736 | $ | 1,022 | ||||
|
Adjustments
to reconcile net income to net cash provided by operating
activities:
|
||||||||
|
Amortization
of debt financing costs
|
208 | 179 | ||||||
|
Depreciation
and amortization
|
2,720 | 1,970 | ||||||
|
Stock-based
compensation
|
562 | 355 | ||||||
|
Allowance
for doubtful accounts
|
25 | 11 | ||||||
|
Unrealized
(gain) loss on interest rate swap
|
(839 | ) | 1,783 | |||||
|
Deferred
income taxes
|
2,565 | — | ||||||
|
Deduction
of net (income) loss from discontinued operation
|
(362 | ) | 92 | |||||
|
Operating
cash provided by discontinued operation
|
904 | 1,353 | ||||||
|
Changes
in operating assets and liabilities, net of disposition and discontinued
operation:
|
||||||||
|
Accounts
receivable
|
(1,713 | ) | (2,183 | ) | ||||
|
Prepaid
expenses and other
|
(854 | ) | 163 | |||||
|
Accounts
payable
|
(101 | ) | 221 | |||||
|
Accrued
expenses
|
245 | 180 | ||||||
|
Deferred
revenue
|
11,106 | 8,405 | ||||||
|
Other
long-term liability
|
425 | — | ||||||
|
Net
cash provided by operating activities
|
21,627 | 13,551 | ||||||
|
Cash
flows from investing activities
|
||||||||
|
Purchase
of property and equipment
|
(1,855 | ) | (1,324 | ) | ||||
|
Purchase
of property and equipment – discontinued operation
|
(93 | ) | — | |||||
|
Investment
in Edline
|
(2,734 | ) | — | |||||
|
Funding
of note receivable from Edline
|
(2,144 | ) | — | |||||
|
Sale
of discontinued operation to Edline
|
3,701 | — | ||||||
|
Acquisition
of discontinued operation
|
— | (9,658 | ) | |||||
|
Net
cash used in investing activities
|
(3,125 | ) | (10,982 | ) | ||||
|
Cash
flows from financing activities
|
||||||||
|
Return
of Capital distributions to members
|
(8,000 | ) | — | |||||
|
Contribution
from member in Reorganization
|
693 | — | ||||||
|
Tax
distributions to members
|
(3,769 | ) | — | |||||
|
Cost
of debt financing
|
— | 215 | ||||||
|
Stock
offering
|
45,402 | — | ||||||
|
Proceeds
from revolver
|
— | 10,000 | ||||||
|
Payments
on revolver
|
— | (10,000 | ) | |||||
|
Payments
on term note
|
(7,724 | ) | (700 | ) | ||||
|
Net
cash provided by (used in) financing activities
|
26,602 | (485 | ) | |||||
|
Net
change in cash and cash equivalents
|
45,104 | 2,084 | ||||||
|
Beginning
of period
|
13,144 | 11,060 | ||||||
|
End
of period
|
$ | 58,248 | $ | 13,144 | ||||
ARCHIPELAGO
LEARNING, INC.
RECONCILIATIONS
OF NON-GAAP MEASURES - UNAUDITED
|
Quarters Ended December 31,
|
Years Ended December 31,
|
|||||||||||||||
|
|
2009
|
2008
|
2009
|
2008
|
||||||||||||
|
(In
thousands)
|
||||||||||||||||
|
Invoiced
Sales:
|
||||||||||||||||
|
New
customers
|
$ | 4,651 | $ | 3,754 | $ | 15,567 | $ | 14,099 | ||||||||
|
Existing
customers
|
9,362 | 6,197 | 37,219 | 24,708 | ||||||||||||
|
Other
sales
|
279 | 244 | 1,088 | 1,013 | ||||||||||||
|
Total
invoiced sales
|
14,292 | 10,195 | 53,874 | 39,820 | ||||||||||||
|
Change
in deferred revenue(1)
|
(2,325 | ) | (921 | ) | (11,106 | ) | (8,405 | ) | ||||||||
|
Revenue
|
$ | 11,967 | $ | 9,274 | $ | 42,768 | $ | 31,415 | ||||||||
|
Adjusted
EBITDA
|
||||||||||||||||
|
Income
from continuing operations
|
$ | 3,174 | $ | 2,609 | $ | 12,630 | $ | 8,230 | ||||||||
|
Depreciation
and amortization
|
747 | 484 | 2,720 | 1,970 | ||||||||||||
|
Change
in deferred revenue(1)
|
2,325 | 921 | 11,106 | 8,405 | ||||||||||||
|
Stock-based
compensation(2)
|
264 | 83 | 562 | 355 | ||||||||||||
|
Investments
/ permitted acquisition expense(3)
|
29 | 61 | 284 | 263 | ||||||||||||
|
Severance(4)
|
22 | 44 | 57 | 44 | ||||||||||||
|
Executive
recruitment(4)
|
172 | — | 226 | — | ||||||||||||
|
Professional
services(4)
|
— | 141 | 348 | 260 | ||||||||||||
|
Agency
/ sponsor fees(5)
|
25 | 58 | 100 | 186 | ||||||||||||
|
Unusual,
non-recurring charges(6)
|
132 | 167 | 322 | 609 | ||||||||||||
|
Adjusted
EBITDA
|
$ | 6,890 | $ | 4,568 | $ | 28,355 | $ | 20,322 | ||||||||
____________
|
(1)
|
Change
in deferred revenue is the net change in deferred revenue at the end of
such period from the deferred revenue at the end of the previous
period.
|
|
(2)
|
Stock-based
compensation includes non-cash compensation expense recorded in respect of
shares issued to our employees.
|
|
(3)
|
Investments
and permitted acquisition expense includes cash fees and expenses in
connection with investments or acquisitions permitted by our credit
facility.
|
|
(4)
|
Represents
severance costs, recruitment and relocation costs associated with the
hiring of our Chief Operating Officer and Chief Marketing Officer and
one-time contract labor fees for an international market study as well as
accounting and legal costs incurred in preparation for our
IPO.
|
|
(5)
|
Agency
fees are fees paid to the agents under our credit facility. Sponsor
payments are payments to Providence Equity Partners that are permitted
under our credit facility, and include the reimbursement of customary fees
and reasonable out-of-pocket expenses to our directors or the managers of
Archipelago Learning Holdings, LLC, such as travel and other
expenses.
|
|
(6)
|
Unusual,
non-recurring charges as defined by our credit agreement include
non-executive recruiting fees, relocation costs, retention bonuses, bank
fees and bad debt accrual in addition to those line items disclosed
separately above.
|
|
Quarters Ended December 31,
|
||||||||||||||||
|
|
2009
|
2008
|
||||||||||||||
|
Dollars
|
Diluted EPS
|
Dollars
|
Diluted EPS
|
|||||||||||||
|
Adjusted
Net Income and Diluted EPS
|
(In
thousands, except EPS)
|
|||||||||||||||
|
Net
(loss) income from continuing operations
|
$ | (171 | ) | $ | (0.01 | ) | $ | 192 | $ | 0.01 | ||||||
|
Tax
provision related to reorganization
|
1,957 | 0.09 | — | — | ||||||||||||
|
Stock-based
compensation
|
264 | 0.01 | 83 | 0.01 | ||||||||||||
|
Derivative
loss
|
82 | 0.01 | 1,262 | 0.06 | ||||||||||||
|
Investments
/ permitted acquisition expense
|
29 | — | 61 | — | ||||||||||||
|
Severance
|
22 | — | 44 | — | ||||||||||||
|
Executive
recruitment
|
172 | 0.01 | — | — | ||||||||||||
|
Professional
services
|
— | — | 141 | 0.01 | ||||||||||||
|
Adjusted
net income and diluted EPS(1)
|
$ | 2,355 | $ | 0.11 | $ | 1,783 | $ | 0.09 | ||||||||
|
Years Ended December 31,
|
||||||||||||||||
|
|
2009
|
2008
|
||||||||||||||
|
Dollars
|
Diluted EPS
|
Dollars
|
Diluted EPS
|
|||||||||||||
|
(In
thousands, except EPS)
|
||||||||||||||||
|
Net
income from continuing operations
|
$ | 6,374 | $ | 0.31 | $ | 1,114 | $ | 0.06 | ||||||||
|
Tax
provision related to reorganization
|
1,957 | 0.10 | — | — | ||||||||||||
|
Stock-based
compensation
|
562 | 0.03 | 355 | 0.02 | ||||||||||||
|
Derivative
loss
|
518 | 0.03 | 2,119 | 0.11 | ||||||||||||
|
Investments
/ permitted acquisition expense
|
284 | 0.01 | 263 | 0.01 | ||||||||||||
|
Severance
|
57 | — | 44 | — | ||||||||||||
|
Executive
recruitment
|
226 | 0.01 | — | — | ||||||||||||
|
Professional
services
|
348 | 0.02 | 260 | 0.01 | ||||||||||||
|
Adjusted
net income and diluted EPS(1)
|
$ | 10,326 | $ | 0.51 | $ | 4,155 | $ | 0.21 | ||||||||
____________
(1)The adjustments to net income above
were largely incurred prior to our reorganization to a C-corporation and thus
had minimal impact on our income tax expense. As a result no impact from taxes
is reflected above.